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ABN AMRO MORTGAGE CORPORATION
Depositor
and
ABN AMRO MORTGAGE GROUP, INC.
Seller and Servicer
and
WASHINGTON MUTUAL MORTGAGE SECURITIES CORP.
Seller and Servicer
and
JPMORGAN CHASE BANK
Trustee
POOLING AND SERVICING AGREEMENT
Dated as of May 1, 2003
$698,933,587
Mortgage Pass-Through Certificates
SERIES 2003-6
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TABLE OF CONTENTS
Page
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ARTICLE I
DEFINITIONS
ARTICLE II
CONVEYANCE OF TRUST FUND;
ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.1 Conveyance of Trust Fund......................................52
Section 2.2 Acceptance by Trustee.........................................55
Section 2.3 Representations and Warranties of the Depositor with
respect to the Loans..........................................57
Section 2.4 Authentication and Delivery of Certificates; Designation of
Certificates as REMIC Regular and Residual Interests..........61
Section 2.5 Designation of Startup Day....................................64
Section 2.6 No Contributions..............................................64
ARTICLE III
ADMINISTRATION AND SERVICING OF LOANS
Section 3.1 Servicers to Act as Servicers; Administration of the Loans....66
Section 3.2 Collection of Certain Loan Payments; Custodial Account
for P&I.......................................................69
Section 3.3 Permitted Withdrawals from the Custodial Account for P&I......72
Section 3.4 Taxes, Assessments and Similar Items; Escrow Accounts.........74
Section 3.5 Maintenance of Insurance......................................75
Section 3.6 Enforcement of Due-on-Sale Clauses; Assumption and
Substitution Agreements.......................................76
Section 3.7 Realization upon Defaulted Loans..............................77
Section 3.8 Trustee to Cooperate; Release of Mortgage Files...............80
Section 3.9 Servicing Compensation........................................80
Section 3.10 Reports to the Trustee; Custodial Account for P&I Statements..81
Section 3.11 Annual Statement as to Compliance.............................81
Section 3.12 Annual Independent Public Accountants' Servicing Report.......82
Section 3.13 Access to Certain Documentation and Information Regarding
the Loans.....................................................82
Section 3.14 [Reserved]....................................................82
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Section 3.15 Sale of Defaulted Loans and REO Properties....................82
Section 3.16 Delegation of Duties..........................................84
Section 3.17 [Reserved]....................................................84
Section 3.18 [Reserved]....................................................84
Section 3.19 Appointment of a Special Servicer.............................84
Section 3.20 Allocation of Realized Losses.................................85
ARTICLE IV
PAYMENTS TO CERTIFICATEHOLDERS; ADVANCES;
STATEMENTS AND REPORTS
Section 4.1 Distributions to Certificateholders...........................87
Section 4.2 Statements to Certificateholders; Exchange Act Reporting......88
Section 4.3 Advances by the Servicer; Distribution Reports to the
Trustee.......................................................91
Section 4.4 Nonrecoverable Advances.......................................92
Section 4.5 Foreclosure Reports...........................................92
Section 4.6 Adjustment of Servicing Fees with Respect to Payoffs..........92
Section 4.7 Prohibited Transactions Taxes and Other Taxes.................93
Section 4.8 Tax Administration............................................93
Section 4.9 Equal Status of Servicing Fee.................................94
Section 4.10 Appointment of Paying Agent and Certificate Administrator.....94
ARTICLE V
THE CERTIFICATES
Section 5.1 The Certificates..............................................96
Section 5.2 Certificates Issuable in Classes; Distributions of Principal
and Interest; Authorized Denominations.......................103
Section 5.3 Registration of Transfer and Exchange of Certificates........104
Section 5.4 Mutilated, Destroyed, Lost or Stolen Certificates............104
Section 5.5 Persons Deemed Owners........................................105
Section 5.6 Temporary Certificates.......................................105
Section 5.7 Book-Entry for Book-Entry Certificates.......................105
Section 5.8 Notices to Clearing Agency...................................107
Section 5.9 Definitive Certificates......................................107
ARTICLE VI
THE DEPOSITOR AND THE SERVICER
Section 6.1 Liability of the Depositor and the Servicers.................108
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Section 6.2 Merger or Consolidation of the Depositor or the Servicers....108
Section 6.3 Limitation on Liability of the Servicers and Others..........108
Section 6.4 Servicers Not to Resign......................................109
Section 6.5 Trustee Access...............................................109
ARTICLE VII
DEFAULT
Section 7.1 Events of Default............................................111
Section 7.2 Other Remedies of Trustee....................................113
Section 7.3 Directions by Certificateholders and Duties of Trustee
During Event of Default......................................113
Section 7.4 Action upon Certain Failures of a Servicer and upon Event
of Default...................................................113
Section 7.5 Appointment of Successor Servicer............................114
Section 7.6 Notification to Certificateholders...........................115
ARTICLE VIII
CONCERNING THE TRUSTEE
Section 8.1 Duties of Trustee............................................116
Section 8.2 Certain Matters Affecting Trustee............................118
Section 8.3 Trustee Not Required to Make Investigation...................119
Section 8.4 Trustee Not Liable for Certificates or Loans.................119
Section 8.5 Trustee May Own Certificates.................................120
Section 8.6 Servicer to Pay Trustee's Fees and Expenses..................120
Section 8.7 Eligibility Requirements for Trustee.........................120
Section 8.8 Resignation and Removal of Trustee...........................121
Section 8.9 Successor Trustee............................................121
Section 8.10 Merger or Consolidation of Trustee...........................122
Section 8.11 Appointment of Co-Trustee or Separate Trustee................122
Section 8.12 Appointment of Custodians. ..................................123
Section 8.13 Authenticating Agent.........................................124
Section 8.14 Bloomberg....................................................125
Section 8.15 Reports to Securities and Exchange Commission................125
Section 8.16 Calculation of LIBOR.........................................125
ARTICLE IX
TERMINATION
Section 9.1 Termination upon Purchase by the Servicers or Liquidation of
All Loans....................................................127
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Section 9.2 Trusts Irrevocable...........................................128
Section 9.3 Additional Termination Requirements..........................128
ARTICLE X
MISCELLANEOUS PROVISIONS
Section 10.1 Amendment....................................................130
Section 10.2 Recordation of Agreement.....................................131
Section 10.3 Limitation on Rights of Certificateholders...................131
Section 10.4 Governing Law; Jurisdiction..................................132
Section 10.5 Notices......................................................132
Section 10.6 Severability of Provisions...................................133
EXHIBITS
Exhibit A - Forms of Certificates
Exhibit B - Form of Residual Certificate
Exhibit C-1 - Form of Interim Certification
Exhibit C-2 - Form of Final Certification
Exhibit D - Schedule of Loans
Exhibit E - Fields of Loan Information
Exhibit F - Form of Transferor Certificate for Privately Offered
Certificates
Exhibit G - Form of Transferee's Certificate for Privately Offered
Certificates
Exhibit H - [Reserved]
Exhibit I - Form of Transferor Certificate
Exhibit J - Form of Transferee Affidavit and Agreement
Exhibit K - Form of Additional Matter Incorporated into the Form of the
Certificates
Exhibit L - Form of Rule 144A Investment Representation
Exhibit M - Aggregate Planned Principal Balances
Exhibit N - Targeted Principal Balances
Exhibit O - [Reserved]
Exhibit P - [Reserved]
Exhibit Q - Bloomberg Data
Exhibit R - Form of Special Servicing Agreement
Exhibit S - Form of Form 10-K Certificate
Exhibit T - Form of Back-up Certification to Form 10-K Certificate
Exhibit U - Form of WMMSC Back-up Certification to Form 10-K Certificate
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This Pooling and Servicing Agreement, dated and effective as of May 1,
2003 (this "Agreement"), is executed by and among ABN AMRO Mortgage Corporation,
as depositor (the "Depositor"), ABN AMRO Mortgage Group, Inc., as a servicer
("AAMG"), Washington Mutual Mortgage Securities Corp., as a servicer ("WMMSC"
and together with AAMG, the "Servicers"), and JPMorgan Chase Bank, as trustee
(the "Trustee"). Capitalized terms used in this Agreement and not otherwise
defined have the meanings ascribed to such terms in Article I hereof.
PRELIMINARY STATEMENT
The Depositor at the Closing Date is the owner of the Loans and the
other property being conveyed by it to the Trustee for inclusion in the Trust
Fund. On the Closing Date, the Depositor will acquire the Certificates from the
Trust Fund as consideration for its transfer to the Trust Fund of the Loans and
certain other assets and will be the owner of the Certificates. The Depositor
has duly authorized the execution and delivery of this Agreement to provide for
the conveyance to the Trustee of the Loans and the issuance to the Depositor of
the Certificates representing in the aggregate the entire beneficial ownership
of the Trust Fund. All covenants and agreements made by the Depositor, the
Servicers and the Trustee herein with respect to the Loans and the other
property constituting the Trust Fund are for the benefit of the Holders from
time to time of the Certificates. The Depositor and the Servicers are entering
into this Agreement, and the Trustee is accepting the trust created hereby, for
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged.
The Certificates issued hereunder, other than the Class B-3, Class B-4
and Class B-5 Certificates have been offered for sale pursuant to a Prospectus,
dated January 23, 2003, and a Prospectus Supplement, dated May 27, 2003 of the
Depositor (together, the "Prospectus"). The Class B-3, Class B-4 and Class B-5
Certificates have been offered for sale pursuant to a Private Placement
Memorandum dated May 28, 2003. The Trust Fund created hereunder is intended to
be the "Trust" as described in the Prospectus and the Private Placement
Memorandum and the Certificates are intended to be the "Certificates" described
therein.
As provided herein, the Trustee will elect to treat the segregated pool
of assets consisting of the Group I Loans and other related assets in the Trust
Fund subject to this Agreement as a REMIC for federal income tax purposes, and
such segregated pool of assets will be designated as "REMIC I." Component R-1 of
the Class R Certificate will represent the sole class of "residual interests" in
REMIC I for purposes of the REMIC Provisions under federal income tax law.
As provided herein, the Trustee will elect to treat the segregated pool
of assets consisting of the Group II Loans and other related assets in the Trust
Fund subject to this Agreement as a REMIC for federal income tax purposes, and
such segregated pool of assets will be designated as "REMIC II." Component R-2
of the Class R Certificate will represent the sole class of "residual interest"
in REMIC II for purposes of the REMIC Provisions under federal income tax law.
As provided herein, the Trustee will elect to treat the segregated pool
of assets consisting of the REMIC I Regular Interests and REMIC II Regular
Interests as a REMIC for federal income tax
purposes, and such segregated pool of assets will be designated as "REMIC III".
Component R-3 of the Class R Certificate will represent the sole class of
"residual interests" in REMIC III for purposes of the REMIC Provisions under
federal income tax law. The following table irrevocably sets forth the
designations, the Remittance Rate, initial Class Principal Balance and Last
Scheduled Distribution Date for each Class of Certificates which, together with
the Class R-3 Component, constitute the entire beneficial interests in REMIC
III. Determined solely for purposes of satisfying Treasury regulation section
1.860G-1(a)(4)(iii), the "latest possible maturity date" for each of the REMIC I
Regular Interests, REMIC II Regular Interests and for each Class of Certificates
shall be the first Distribution Date that is at least two years after the end of
the remaining amortization schedule of the Loan in the Mortgage Pool that has,
as of the Closing Date, the longest remaining amortization schedule,
irrespective of its scheduled maturity.
Remittance Initial Class Principal Last Scheduled
Designation Rate (1) or Notional Balance Distribution Date*
----------- ------------ ----------------------- ------------------
Class IA-1 4.00% 96,588,000.00 May 25, 2033
Class IA-2 5.50%(2) 49,382,863.00 May 25, 2033
Class IA-3 5.50% 31,103,000.00 May 25, 2033
Class IA-4 5.50%(3)(4) 43,650,000.00 May 25, 2033
Class IA-5 5.50% 47,462,000.00 May 25, 2033
Class IA-6 5.50% 5,066,000.00 May 25, 2033
Class IA-7 5.50% 16,927,000.00 May 25, 2033
Class IA-8 5.50% 29,299,000.00 May 25, 2033
Class IA-9 5.50% 10,000,000.00 May 25, 2033
Class IA-10 5.50% 8,215,000.00 May 25, 2033
Class IA-11 5.50% 5,000,000.00 May 25, 2033
Class IA-12 5.50% 8,000,000.00 May 25, 2033
Class IA-13 (5) 2,062,500.00 May 25, 2033
Class IA-14 (6) 808,594.00 May 25, 2033
Class IA-15 (7) 128,906.00 May 25, 2033
Class IA-16 (8) 1,756,944.00 May 25, 2033
Class IA-17 (9) 867,064.00 May 25, 2033
Class IA-18 (10) 250,992.00 May 25, 2033
Class IA-19 (11) 19,857,399.00 May 25, 2033
Class IA-20 (12) 5,129,631.00 May 25, 2033
Class IA-21 (13) 203,703.00 May 25, 2033
Class IA-22 (14) 2,000,000.00 May 25, 2033
Class IA-23 (15) 1,071,636.00 May 25, 2033
Class IA-24 (16) 88,631.00 May 25, 2033
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Class IA-25 4.25% 52,231,000.00 May 25, 2033
Class IA-26 5.50%(3)(4) 5,081,174.00 May 25, 2033
Class IA-27 5.50%(3)(4) 23,129,000.00 May 25, 2033
Class IA-28 5.50% 10,281,000.00 May 25, 2033
Class IA-29 3.75% 15,649,000.00 May 25, 2033
Class IA-30 4.75% 45,399,000.00 May 25, 2033
Class IA-X 5.50%(17) 82,407.00 May 25, 2033
Class IA-P 0.00%(18) 2,097,788.00 May 25, 2033
Class IIA-1 4.75% 61,047,000.00 May 25, 2018
Class IIA-2 4.50% 15,500,000.00 May 25, 2018
Class IIA-3 4.75%(19) 1,000,000.00 May 25, 2018
Class IIA-4 4.75% 13,250,000.00 May 25, 2018
Class IIA-5 (20) 14,970,028.00 May 25, 2018
Class IIA-6 (21) 14,970,028.00 May 25, 2018
Class IIA-7 2.70% 23,732,972.00 May 25, 2018
Class IIA-8 4.75% 63,807,504.00 May 25, 2018
Class IIA-X 4.75(17) 12,006,907.00 May 25, 2018
Class IIA-P 0.00%(18) 496,015.00 May 25, 2018
Class M variable(22) 7,338,803.00 May 25, 2033
Class B-1 variable(22) 3,494,668.00 May 25, 2033
Class B-2 variable(22) 2,166,694.00 May 25, 2033
Class B-3 variable(22) 978,507.00 May 25, 2033
Class B-4 variable(22) 698,934.00 May 25, 2033
Class B-5 variable(22) 1,048,399.00 May 25, 2033
Class R+ 4.729954229% $ 100.00(23) May 25, 2033
* The Distribution Date in the month of the maturity date for the latest
maturing Loan.
+ The Class R Certificate is entitled to receive the Residual
Distribution Amount and Excess Liquidation Proceeds.
(1) Interest distributed to the Certificates (other than the Principal Only
Certificates) on each Distribution Date will have accrued during the
related Interest Accrual Period at the applicable per annum Remittance
Rate.
(2) The Class IA-2 Certificates will accrue interest on the Class IA-2
Notional Amount (as defined herein).
(3) The Class IA-4 Certificates and Class IA-26 Certificates will generally
not be entitled to receive any distributions of principal, Principal
Prepayments or Liquidation Proceeds until the Distribution Date in June
2008.
(4) A certain portion of realized losses, other than excess losses,
otherwise allocable to the Class IA-4 Certificates and Class IA-27
Certificates will be allocated to the Class IA-26 certificates as set
forth herein, until the class principal balance of the Class IA-26
Certificates is reduced to zero.
(5) Interest will accrue on the Class IA-13 Certificates with respect to
any Distribution Date on or prior to November 2004 at a fixed rate
equal to 2.750% per annum, and as to any Distribution Date thereafter,
will be a per annum rate equal to LIBOR plus 0.75% (subject to a
maximum rate of 8.00% per annum and a minimum rate of 0.75% per annum).
(6) Interest will accrue on the Class IA-14 Certificates with respect to
any Distribution Date on or prior to November 2004 at a fixed rate
equal to 10.202899% per annum, and as to any Distribution Date
thereafter, will be a per annum rate equal to 15.304349% minus the
product of LIBOR and 2.550725 (subject to a maximum rate of 15.304349%
per annum and a minimum rate of 0.00% per annum).
(7) Interest will accrue on the Class IA-15 Certificates with respect to
any Distribution Date on or prior to November 2004 at a fixed rate
equal to 20.000% per annum, and as to any Distribution Date thereafter,
a per annum rate equal to 116.00% minus the product of LIBOR and 16.00
(subject to a maximum rate of 20.00% per annum and a minimum rate of
0.00% per annum).
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(8) Interest will accrue on the Class IA-16 Certificates with respect to
the initial Distribution Date at a fixed rate equal to 2.50% per annum,
and as to any Distribution Date thereafter, a per annum rate equal to
LIBOR plus 0.50% (subject to a maximum rate of 9.00% per annum and a
minimum rate of 0.50% per annum).
(9) Interest will accrue on the Class IA-17 Certificates with respect to
any Distribution Date on or prior to November 2004 at a fixed rate
equal to 11.144731% per annum, and as to any Distribution Date
thereafter, a per annum rate equal to 15.197360% minus the product of
LIBOR and 2.026315 (subject to a maximum rate of 15.197360% per annum
and a minimum rate of 0.00% per annum).
(10) Interest will accrue on the Class IA-18 Certificates with respect to
any Distribution Date on or prior to November 2004 at a fixed rate
equal to 7.00% per annum, and as to any Distribution Date thereafter, a
per annum rate equal to 59.499880% minus the product of LIBOR and
6.999984 (subject to a maximum rate of 7.00% per annum and a minimum
rate of 0.00% per annum).
(11) Interest will accrue on the Class IA-19 Certificates with respect to
the initial Distribution Date at a fixed rate equal to 2.57% per annum,
and as to any Distribution Date thereafter, a per annum rate equal to
LIBOR plus 1.25% (subject to a maximum rate of 7.50% per annum and a
minimum rate of 1.25% per annum).
(12) Interest will accrue on the Class IA-20 Certificates with respect to
the initial Distribution Date at a fixed rate equal to 13.381082% per
annum, and as to any Distribution Date thereafter, a per annum rate
equal to 17.155233% minus the product of LIBOR and 2.859205 (subject to
a maximum rate of 17.155233% per annum and a minimum rate of 0.00% per
annum).
(13) Interest will accrue on the Class IA-21 Certificates with respect to
the initial Distribution Date at a fixed rate equal to 18.00% per
annum, and as to any Distribution Date thereafter, a per annum rate
equal to 449.999405% minus the product of LIBOR and 71.999901 (subject
to a maximum rate of 18.00% per annum and a minimum rate of 0.00% per
annum).
(14) Interest will accrue on the Class IA-22 Certificates with respect to
the initial Distribution Date at a fixed rate equal to 8.43% per annum,
and as to any Distribution Date thereafter, a per annum rate equal to
9.75% minus LIBOR (subject to a maximum rate of 9.75% per annum and a
minimum rate of 3.50% per annum).
(15) Interest will accrue on the Class IA-23 Certificates with respect to
the initial Distribution Date at a fixed rate equal to 13.934429% per
annum, and as to any Distribution Date thereafter, a per annum rate
equal to 17.864653% minus the product of LIBOR and 2.977442 (subject to
a maximum rate of 17.864653% per annum and a minimum rate of 0.00% per
annum).
(16) Interest will accrue on the Class IA-24 Certificates with respect to
the initial Distribution Date at a fixed rate equal to 9.00% per annum,
and as to any Distribution Date thereafter, a per annum rate equal to
224.999318% minus the product of LIBOR and 35.999886 (subject to a
maximum rate of 9.00% per annum and a minimum rate of 0.00% per annum).
(17) The Class IA-X Certificates will accrue interest on the Class IA-X
Notional Amount (as defined herein) and the Class IIA-X Certificates
will accrue interest on the Class IIA-X Notional Amount (as defined
herein).
(18) The Class IA-P and Class IIA-P Certificates will not be entitled to
distributions of interest and will receive principal only in respect of
the Group I Loans and Group II Loans, respectively with Pass-Through
Rates that are less than 5.50% and 4.729954229% per annum,
respectively.
(19) To the extent not used to reduce the principal amounts of the Class
IIA-1 Certificates to its Targeted Principal Balance (as defined
herein) on each Distribution Date as set forth herein, interest accrued
on the Class IIA-3 Certificates will be distributed on each
Distribution Date as interest to the Class IIA-3 Certificates (to the
extent available) rather than added to its principal balance.
(20) Interest will accrue on the Class IIA-5 Certificates with respect to
the initial Distribution Date at a fixed rate equal to 1.57% per annum,
and as to any Distribution Date thereafter, a per annum rate equal to
LIBOR plus 0.25% (subject to a maximum rate of 8.00% per annum and a
minimum rate of 0.25% per annum).
(21) Interest will accrue on the Class IIA-6 Certificates with respect to
the initial Distribution Date at a fixed rate equal to 6.43% per annum,
and as to any Distribution Date thereafter, a per annum rate equal to
7.75% minus LIBOR (subject to a maximum rate of 7.75% per annum and a
minimum rate of 0.00% per annum). The Class IIA-6 Certificates will
accrue interest on the Class IIA-6 Notional Amount (as defined herein).
(22) The interest rate on these Classes of Certificates will vary from
4.729954229% to 5.50% per annum. The initial Subordinate Interest Rate
(as defined herein) on each Class of these Certificates will be
approximately 5.2815632250% per annum.
(23) The Class R Certificate will be comprised of three components,
component R-1, which represents the sole residual interest in REMIC I
(as defined herein), component R-2, which represents the sole residual
interest in REMIC II (as defined herein) and component R-3, which
represents the sole residual interest in REMIC III (as defined herein).
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W I T N E S S E T H
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In consideration of the mutual agreements herein contained, the
Depositor, each Servicer and the Trustee agree as follows:
ARTICLE I
DEFINITIONS
Whenever used herein, the following words and phrases, unless the
context otherwise requires, shall have the meanings specified in this Article:
ACCRETION DIRECTED TAC CERTIFICATES: The Class IIA-1 Certificates.
ACCRUAL CERTIFICATES: The Class IIA-3 Certificates.
ADJUSTABLE RATE CERTIFICATES: The Class IA-13, Class IA-14, Class
IA-15, Class IA-16, Class IA-17, Class IA-18, Class IA-19, Class IA-20, Class
IA-21, Class IA-22, Class IA-23, Class IA-24, Class IIA-5 and Class IIA-6
Certificates.
ADVANCE: An Advance made by a Servicer pursuant to Section 4.3.
AFFILIATE: With respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control" when used with respect to any
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise, and the terms "controlling" and
"controlled" have meanings correlative to the foregoing. The Trustee may obtain
and rely on an Officer's Certificate of each Servicer or the Depositor to
determine whether any Person is an Affiliate of such party.
AGGREGATE CERTIFICATE PRINCIPAL BALANCE: At any given time, the sum of
the then current Class Principal Balances of all Classes of Certificates.
AGGREGATE PLANNED PRINCIPAL BALANCE: For any Distribution Date, the
amount set forth in the table attached hereto as Exhibit M for such Distribution
Date, for the aggregate Class Principal Balance of the Class IA-1, Class IA-3,
Class IA-25, Class IA-27, Class IA-28, Class IA-29, Class IA-30 Certificates for
the Group I Loans and the aggregate Class Principal Balance of the Class IIA- 5
Certificates and Class IIA-7 Certificates for the Group II Loans.
AGGREGATE SUBORDINATE PERCENTAGE: As of the Closing Date, approximately
2.26% and thereafter, with respect to any Distribution Date, is equal to the
following fraction:
the aggregate of the Class Principal Balances of the Subordinate
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Certificates immediately prior to such Distribution Date
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the aggregate Scheduled Principal Balance of all of the Loans immediately prior
to such Distribution Date (exclusive of the sum of the Group I Discount Fraction
of the Group I Loans for such Distribution Date and the Group II Discount
Fraction of the Group II Loans for such Distribution Date).
AGREEMENT: This Pooling and Servicing Agreement and all amendments and
supplements hereto.
ALTA: The American Land Title Association, or any successor.
ANNIVERSARY: Each anniversary of the Cut-off Date.
APPRAISED VALUE: The amount set forth in an appraisal made by or for
the mortgage originator in connection with its origination of each Loan.
ASSIGNMENT: An assignment of the Mortgage, notice of transfer or
equivalent instrument, in recordable form, sufficient under the laws of the
jurisdiction where the related Mortgaged Property is located to reflect of
record the sale and assignment of the Loan to the Trustee, which assignment,
notice of transfer or equivalent instrument may, if permitted by law, be in the
form of one or more blanket assignments covering Mortgages secured by Mortgaged
Properties located in the same county.
AUTHENTICATING AGENT: Any authenticating agent appointed by the Trustee
pursuant to Section 8.13.
AUTHORIZED DENOMINATION: With respect to the Certificates (other than
the Retail Certificates, Class IA-2, Class IIA-6, Class IA-X and Class IIA-X
Certificates, Class R Certificate and Junior Subordinate Certificates), an
initial Certificate Principal Balance equal to $25,000 each and integral
multiples of $1 in excess thereof. With respect to the Retail Certificates, an
initial Certificate Principal Balance equal to $1,000 each and integral
multiples of $1 in excess thereof. With respect to the Class IA-2 and Class
IIA-6 Certificates, an initial Class Notional Amount equal to $500,000 each and
integral multiples of $1 in excess thereof. With respect to the Class IA-X
Certificates and Class IIA-X Certificates, an initial Class Notional Amount
equal to $100,000 each and integral multiples of $1 in excess thereof. With
respect to the Class R Certificate, one Certificate with a Percentage Interest
equal to 100%. With respect to the Junior Subordinate Certificates, an initial
Certificate Principal Balance equal to $100,000 each and integral multiples of
$1 in excess thereof, except with respect to the Class B-5 Certificates, which
may be issued in a different amount that is not a multiple of $1.
AVAILABLE DISTRIBUTION AMOUNT: As determined separately for each Loan
Group, the sum of the following amounts:
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(1) the total amount of all cash received by or on behalf of
the related Servicer with respect to such related Loans by the
Determination Date for such Distribution Date and not previously
distributed (including Liquidation Proceeds and Insurance Proceeds),
except:
(a) all Prepaid Monthly Payments;
(b) all Curtailments received after the applicable
Prepayment Period (together with any interest payment received
with such prepayments to the extent that it represents the
payment of interest accrued on a related Loan subsequent to
the applicable Prepayment Period);
(c) all Payoffs received after the applicable
Prepayment Period (together with any interest payment received
with such Payoffs to the extent that it represents the payment
of interest accrued on such Loan for the period subsequent to
the applicable Prepayment Period; and with respect to the
Group I Loans, interest that was accrued and received on
Payoffs received during the period from the 1st to the 14th
calendar day of the month of such Distribution Date which
interest will not be included in the calculation of Available
Distribution Amount for any Distribution Date), and any
prepayment penalties related to the Mortgage Loans;
(d) Insurance Proceeds and Liquidation Proceeds on
such Loans received after the applicable Prepayment Period;
(e) all amounts in the Custodial Account for P & I
which are due and reimbursable to the related Servicer
pursuant to the terms of this Agreement;
(f) the Servicing Fee for each such Loan; and
(g) Excess Liquidation Proceeds;
(2) to the extent advanced by the related Servicer and not
previously distributed, the amount of any Advance made by such Servicer
to the Trustee with respect to such Distribution Date relating to such
related Loans;
(3) to the extent advanced by the related Servicer and not
previously distributed, any amount payable as Compensating Interest by
the related Servicer on such Distribution Date relating to such related
Loans; and
(4) the total amount, to the extent not previously
distributed, of all cash received by the Distribution Date by the
Trustee or the related Servicer, in respect of a Purchase Obligation
under Section 2.2 and Section 2.3 or any permitted repurchase of a
Loan;
-7-
provided that, on any Distribution Date on or after the date on which the
aggregate Certificate Principal Balance of the Class IA Certificates or the
Class IIA Certificates and Class R Certificate has been reduced to zero, the
Available Distribution Amount, to the extent attributable to principal (in
excess of that needed to reduce such aggregate Certificate Principal Balances of
the Class IA Certificates or the Class IIA Certificates and Class R Certificate
to zero) for the Loan Group relating to such Certificates that have been paid in
full, other than the portion thereof distributable to the Class IA-P
Certificates and Class IIA-P Certificates, as applicable, shall be reduced by
the Class Principal Balance of the remaining Class IA Certificates or Class IIA
Certificates and Class R Certificate, as applicable, that have not been paid in
full and such amount shall be added to the Available Distribution Amount for the
Loan Group relating to such Certificates, provided further that on such
Distribution Date either (a) the Aggregate Subordinate Percentage for such
Distribution Date is less than 200% times the initial Aggregate Subordinate
Percentage, or (b) the average outstanding Principal Balance of the Loans in
either Loan Group delinquent 60 days or more (including for this purpose any
such Loans in foreclosure and REO Property) over the last six months, as a
percentage of the corresponding Group I or Group II Subordinate Amount, is
greater than or equal to 50%.
BANKRUPTCY COVERAGE: As of the Cut-Off Date, $50,000 and thereafter,
the initial Bankruptcy Coverage amount less (a) any scheduled or permissible
reduction in the applicable amount of Bankruptcy Coverage pursuant to this
definition and (b) Bankruptcy Losses allocated to the Certificates. The
Bankruptcy Coverage may be reduced upon written confirmation from each Rating
Agency that such reduction will not adversely affect the then current ratings
assigned to the Certificates by each Rating Agency.
BANKRUPTCY LOSS: A loss on a Loan arising out of (i) a reduction in the
scheduled Monthly Payment for such Loan by a court of competent jurisdiction in
a case under the United States Bankruptcy Code, other than any such reduction
that arises out of clause (ii) of this definition of "Bankruptcy Loss,"
including, without limitation, any such reduction that results in a permanent
forgiveness of principal, or (ii) with respect to any Loan, a valuation, by a
court of competent jurisdiction in a case under such Bankruptcy Code, of the
related Mortgaged Property in an amount less than the then outstanding Principal
Balance of such Loan.
BENEFICIAL HOLDER: A Person holding a beneficial interest in any
Book-Entry Certificate as or through a DTC Participant or an Indirect DTC
Participant or a Person holding a beneficial interest in any Definitive
Certificate.
BOOK-ENTRY CERTIFICATES: The Class IA Certificates, the Class IIA
Certificates, the Class A-P Certificates, the Class M Certificates, the Class
B-1 Certificates and the Class B-2 Certificates, the beneficial ownership and
transfers of which shall be made through book entries as described in Section
5.7.
BUSINESS DAY: Any day other than a Saturday, a Sunday, or a day on
which banking institutions in Chicago, Illinois or New York, New York, or the
state in which the office of any Servicer is located are authorized or obligated
by law or executive order to be closed.
-8-
CERTIFICATE: Any one of the Certificates issued pursuant to this
Agreement, executed by the Trustee and authenticated by or on behalf of the
Trustee hereunder in substantially one of the forms set forth in Exhibits A and
B hereto. The additional matter appearing in Exhibit K shall be deemed
incorporated into Exhibits A and B as though set forth at the end of Exhibit A
and at the end of Exhibit B, as applicable.
CERTIFICATE ACCOUNT: The separate trust account created and maintained
with the Trustee or any other bank or trust company acceptable to each Rating
Agency which is incorporated or organized under the laws of the United States or
any state thereof, which account shall bear a designation clearly indicating
that the funds deposited therein are held in trust for the benefit of the
Trustee on behalf of the Certificateholders or any other account serving a
similar function acceptable to each Rating Agency. Funds in the Certificate
Account in respect of the Group I Loans and Group II Loans and amounts withdrawn
from the Certificate Account attributable to each of such Loan Groups shall be
accounted for separately. If the Trustee has appointed a Certificate
Administrator pursuant to Section 4.10, funds on deposit in the Certificate
Account may be invested in Eligible Investments and reinvestment earnings
thereon shall be paid to the Certificate Administrator as additional
compensation for the Certificate Administrator's performance of the duties
delegated to it by the Trustee. Funds deposited in the Certificate Account
(exclusive of the Servicing Fee) shall be held in trust for the
Certificateholders and for the uses and purposes set forth in Section 3.2,
Section 3.3 and Section 4.1.
CERTIFICATE ADMINISTRATOR: As defined in Section 4.10.
CERTIFICATE ADMINISTRATOR AND TRUSTEE FEE: For each Loan in both Loan
Groups, a fee per annum equal to 0.0100%, of the outstanding Principal Balance
thereof which shall be paid by AAMG to the Certificate Administrator and the
Trustee.
CERTIFICATE DISTRIBUTION AMOUNT: (I) For any Distribution Date prior to
the Credit Support Depletion Date, the applicable Available Distribution Amount
shall be distributed to the related Certificates in the following amounts and
priority:
(A) with respect to the Class IA Certificates and the Subordinate
Certificates, to the extent of the Available Distribution
Amount for Loan Group I on such Distribution Date:
(i) first, the sum of the Group I Discount Fractional Principal
Amounts for such Distribution Date, to the Class IA-P
Certificates, until its Class Principal Balance has been
reduced to zero;
(ii) second, to the Class IA Certificates entitled to receive
interest, previously unpaid and then current Interest
Distribution Amounts, pro rata according to such amount
payable to the extent of the amounts available;
-9-
(iii) third, the Group I Senior Principal Amount to the Class IA
Certificates then entitled to principal, as follows:
(1) first, to the Lockout Certificates, pro rata, the Lockout
Principal Amount, until their Class Principal Balances have
been reduced to zero;
(2) second, to the Class IA-1, Class IA-3, Class IA-25, Class
IA-27, Class IA-28, Class IA-29 and Class IA-30 Certificates
to the extent necessary to reduce their aggregate Class
Principal Balance to their Aggregate Planned Principal Balance
for such Distribution Date, concurrently as follows:
(a) 57.0376849625% of the amount distributable under
clause (I)(A)(iii)(2) above shall be distributed to the
following Classes of Certificates in the following manner
and order of priority, until their Class Principal
Balances have been reduced to zero:
(i) first, to the Class IA-1 Certificates in an
amount up to the Class IA-1 Priority Amount I,
reduced by all distributions under this clause
(I)(A)(iii)(2)(a)(i) for all prior Distribution
Dates, until its Class Principal Balance has been
reduced to zero;
(ii) second, to the Class IA-30 Certificates, until
its Class Principal Balance has been reduced to zero;
(iii) third, concurrently as follows:
(0) 00.0000000000% of the amount distributable
under clause (I)(A)(iii)(2)(a)(iii) above to the
Class IA-27 Certificates, until its Class
Principal Balance has been reduced to zero; and
(0) 00.0000000000% of the amount distributable
under clause (I)(A)(iii)(2)(a)(iii) above to the
Class IA-28 Certificates and Class IA-27
Certificates, sequentially, in that order, in
each case until its Class Principal Balance has
been reduced to zero; and
(b) 42.9623150375% of the amount distributable under
clause (I)(A)(iii)(2) above shall be distributed to the
following Classes of Certificates in the following manner
and order of priority, until their Class Principal
Balances have been reduced to zero:
(i) first, concurrently as follows:
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(0) 00.0000000000% of the amount
distributable under clause
(I)(A)(iii)(2)(b)(i) above shall be
distributed to the Class IA- 25
Certificates, until its Class Principal
Balance has been reduced to zero;
(0) 00.0000000000% of the amount
distributable under clause
(I)(A)(iii)(2)(b)(i) above shall be
distributed to the Class IA- 29
Certificates, until its Class Principal
Balance has been reduced to zero; and
(0) 00.0000000000% of the amount
distributable under clause
(I)(A)(iii)(2)(b)(i) above shall be
distributed in the following manner and
order of priority:
(a) first, to the Class IA-1
Certificates in an amount up to
the Class IA-1 Priority Amount II,
reduced by all distributions under
this clause
(I)(A)(iii)(2)(b)(i)(3)(a) for all
prior Distribution Dates, until
its Class Principal Balance has
been reduced to zero;
(b) second, concurrently as follows:
(i) 23.0632551528% of the amount
distributable under clause
(I)(A)(iii)(2)(b)(i)(3)(b)
above shall be distributed to
the Class IA-29 Certificates,
until its Class Principal
Balance has been reduced to
zero; and
(ii)76.9367448472% of the amount
distributable under clause
(I)(A)(iii)(2)(b)(i)(3)(b)
above shall be distributed to
the Class IA-25 Certificates,
until its Class Principal
Balance has been reduced to
zero;
(ii) second, to the Class IA-3 Certificates,
until its Class Principal Balance has been
reduced to zero; and
(iii) third, to the Class IA-27 Certificates,
until its Class Principal Balance has been
reduced to zero;
(3) third, concurrently as follows:
(a) 64.6999876144% of the amount distributable under
clause (I)(A)(iii)(3) above to the Class IA-5 Certificates
and Class IA-9 Certificates, pro rata, until their Class
Principal Balances have been reduced to zero; and
-11-
(b) 35.3000123586% of the amount distributable under
clause (I)(A)(iii)(3) above to the Class IA-13, Class
IA-14, Class IA-15, Class IA-19, Class IA-20, Class IA-
21, Class IA-22, Class IA-23 and Class IA-24 Certificates,
pro rata, until their Class Principal Balances have been
reduced to zero;
(4) fourth, to the Class IA-6 Certificates and Class IA-10
Certificates, pro rata, until their Class Principal Balances
have been reduced to zero;
(5) fifth, to the Class IA-7 Certificates and Class IA-11
Certificates, pro rata, until their Class Principal Balances
have been reduced to zero;
(6) sixth, to the Class IA-8, Class IA-12, Class IA-16, Class
IA-17 and Class IA-18 Certificates, pro rata, until their
Class Principal Balances have been reduced to zero;
(7) seventh, to the Class IA-1, Class IA-3, Class IA-25, Class
IA-27, Class IA-28, Class IA-29 and Class IA-30 Certificates,
without regard to their Aggregate Planned Principal Balance
for such Distribution Date, in the manner and order or
priority set forth in clause (I)(A)(iii)(2) above, until their
Class Principal Balances have been reduced to zero; and
(8) eighth, to the Lockout Certificates, pro rata, until their
Class Principal Balances have been reduced to zero;
(iv) fourth, to the Class IA-P Certificates, up to the related
Subordinate Principal Amount (determined without regard to
the proviso of such definition) for such Distribution
Date, the Group I Discount Fractional Principal Shortfall
payable to the Class IA-P Certificates on previous
Distribution Dates pursuant to paragraph (I)(A)(v) of this
definition of "Certificate Distribution Amount" and
remaining unpaid from such previous Distribution Dates;
(v) fifth, to the Class IA-P Certificates, up to the related
Subordinate Principal Amount (determined without regard to
the proviso of such definition) for such Distribution Date
(less any amounts distributed to the Class IA-P
Certificates pursuant to paragraph (I)(A)(iv)), the Group
I Discount Fractional Principal Shortfall for such
Distribution Date; provided that any amounts distributed
in respect of the Group I Discount Fractional Principal
Shortfall pursuant to paragraph (I)(A)(iv) or this
paragraph (I)(A)(v) of this definition of "Certificate
Distribution Amount" shall not cause a further reduction
of the Class IA-P Principal Balance; and
(vi) sixth, to the Class IIA Certificates and Class R
Certificate, any amounts distributable in respect of the
Group II Undercollateralized Amount;
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(B) With respect to the Senior Certificates and Subordinate
Certificates, on any Distribution Date prior to the Credit
Support Depletion Date, to the extent of the Available
Distribution Amount for Loan Group I remaining:
(i) first, to the Class M, Class B-1, Class B-2, Class B-3, Class
B-4 and Class B-5 Certificates, in their order of seniority,
the following:
(a) their respective amounts of previously unpaid and then
current Interest Distribution Amounts;
(b) their pro rata share, according to their respective Class
Principal Balances, of the related Subordinate Principal
Amount allocable pursuant to the definition of
"Subordinate Principal Amount" herein, until their Class
Principal Balances have been reduced to zero;
(ii) second, to the Class IA Certificates (other than the Class
IA-2 Certificates and Class IA-X Certificates) and Subordinate
Certificates in their order of seniority, the amount of
unreimbursed Realized Losses previously allocated to such
Class of Certificates, if any; provided, that any amounts
distributed in respect of losses pursuant to this paragraph
(I)(B)(ii) of this definition of "Certificate Distribution
Amount" shall not cause a further reduction in the Class
Principal Balances of the Class IA Certificates or Subordinate
Certificates; and
(iii) third, to the Class R Certificate, the Residual
Distribution Amount attributable to the Available
Distribution Amount for Loan Group I;
(C) with respect to the Class IIA Certificates, Class R Certificate and
Subordinate Certificates, to the extent of the Available Distribution Amount for
Loan Group II on such Distribution Date:
(i) first, as principal to the Class IIA-P Certificates, the sum
of the Group II Discount Fractional Principal Amounts for such
Distribution Date, until its Class Principal Balance has been
reduced to zero;
(ii) second, to the Class IIA Certificates entitled to receive
interest and Class R Certificate, previously unpaid and then
current Interest Distribution Amounts for such Classes of
Certificates, pro rata according to such amount payable to the
extent of the amounts available; PROVIDED, HOWEVER, that until
the Class Principal Balance of the Class IIA-1 Certificates
has been reduced to zero, the aggregate amount of interest
accrued on the Class IIA-3 Certificates shall be payable as
principal to the Class IIA-1 Certificates, until the Class
Principal Balance of the Class IIA-1 Certificates has been
reduced to its Targeted Principal Balance for such
Distribution Date;
-13-
(iii) third, the Group II Senior Principal Amount to the Class IIA
Certificates then entitled to principal and the Class R
Certificate in the following manner and order of priority:
(1) first, to the Class R certificate, until its Class Principal
Balance has been reduced to zero; and
(2) second, concurrently as follows:
(a) 8.0183126259% of the amount distributable under clause
(II)(C)(iii)(2) above shall be distributed to the Class IIA-2
Certificates, until its Class Principal Balance has been
reduced to zero;
(b) 33.0000000000% of the amount distributable under clause
(II)(C)(iii)(2) above shall be distributed to the Class IIA-8
Certificates, until its Class Principal Balance has been
reduced to zero; and
(c) 58.9733960871% of the amount distributable under clause
(II)(C)(iii)(2) above shall be distributed in the following
manner and order of priority:
(i) first, to the Class IIA-5 Certificates and Class IIA-7
Certificates, pro rata, to the extent necessary to reduce
their aggregate Class Principal Balance to their Aggregate
Planned Principal Balance for such Distribution Date;
(ii) second, to the Class IIA-1 Certificates to the extent
necessary to reduce its Class Principal Balance to its
Targeted Principal Balance for such Distribution Date;
(iii) third, to the Class IIA-3 Certificates, until its
Class Principal Balance has been reduced to zero;
(iv) fourth, to the Class IIA-1 Certificates, without
regard to its Targeted Principal Balance for such
Distribution Date, until its Class Principal Balance has
been reduced to zero;
(v) fifth, to the Class IIA-5 Certificates and Class IIA-7
Certificates, without regard to their Aggregate Planned
Principal Balance for such Distribution Date, pro rata,
until their Class Principal Balances have been reduced to
zero; and
(vi) sixth, to the Class IIA-4 Certificates, until its
Class Principal Balance has been reduced to zero;
-14-
(iv) fourth, to the Class IIA-P Certificates, up to the related
Subordinate Principal Amount (determined without regard to the
proviso of such definition) for such Distribution Date, the
Group II Discount Fractional Principal Shortfall payable to
the Class IIA-P Certificates on previous Distribution Dates
pursuant to paragraph (II)(C)(v) of this definition of
"Certificate Distribution Amount" and remaining unpaid from
such previous Distribution Dates;
(v) fifth, to the Class IIA-P Certificates, up to the related
Subordinate Principal Amount (determined without regard to the
proviso of such definition) for such Distribution Date (less
any amounts distributed to the Class IIA-P Certificates
pursuant to paragraph (II)(C)(iv)), the Group II Discount
Fractional Principal Shortfall for such Distribution Date;
provided that any amounts distributed in respect of the Group
II Discount Fractional Principal Shortfall pursuant to
paragraph (II)(C)(iv) or this paragraph (II)(C)(v) of this
definition of "Certificate Distribution Amount" shall not
cause a further reduction of the Class IIA-P Principal
Balance; and
(vi) sixth, to the Class IA Certificates, any amounts distributable
in respect of the Group I Undercollateralized Amount;
(D) with respect to the Senior Certificates and Subordinate
Certificates, on any Distribution Date prior to the Credit Support Depletion
Date, to the extent of the Available Distribution Amount for Loan Group II
remaining:
(i) first, to the Class M, Class B-1, Class B-2, Class B-3, Class
B-4 and Class B-5 Certificates, in their order of seniority,
the following:
(a) their respective amounts of previously unpaid and then
current Interest Distribution Amounts;
(b) their pro rata share, according to their respective Class
Principal Balances, of the related Subordinate Principal
Amount allocable pursuant to the definition of "Subordinate
Principal Amount" herein, until their Class Principal Balances
have been reduced to zero;
(ii) second, to the Class IIA Certificates (other than the Class
IIA-6 Certificates and Class IIA-X Certificates), Class R
Certificate and the Subordinate Certificates in their order of
seniority, the amount of unreimbursed Realized Losses
previously allocated to such Class, if any, provided, that any
amounts distributed in respect of losses pursuant to this
paragraph (II)(D)(ii) of this definition of "Certificate
Distribution Amount" shall not cause a further reduction in
the Class Principal Balances of the Class IIA Certificates or
Subordinate Certificates; and
-15-
(iii) third, to the Class R Certificate, the Residual Distribution
Amount attributable to the Available Distribution Amount for
Loan Group II;
(II) For any Distribution Date on or after the Credit Support Depletion
Date, the applicable Available Distribution Amount remaining, shall be
distributed to the applicable Certificates in the following amounts and
priority:
(A) with respect to the Class IA Certificates, to the extent of
the Available Distribution Amount for Loan Group I on such
Distribution Date:
(i) first, to the Class IA-P Certificates the sum of the Group
I Discount Fractional Principal Amounts for such
Distribution Date, until its Class Principal Balance has
been reduced to zero;
(ii) second, to the Class IA Certificates (excluding the Class
IA-P Certificates), previously unpaid and then current
Interest Distribution Amounts, pro rata, according to such
amount payable to the extent of amounts available;
(iii) third, to the Class IA Certificates (other than the Class
IA-2, Class IA-X and Class IA-P Certificates), the Group I
Senior Principal Amount, pro rata, according to their
respective Class Principal Balances, until their
respective outstanding Class Principal Balances have been
reduced to zero;
(iv) fourth, to the Class IA Certificates (other than the Class
IA-2 Certificates and Class IA-X Certificates), pro rata,
according to their respective Class Principal Balances,
the amount of unreimbursed Realized Losses previously
allocated to such Class; and
(v) fifth, to the Class R Certificate, the remainder, if any,
of the Available Distribution Amount for Group I for such
Distribution Date.
(B) with respect to the Class IIA Certificates and Class R
Certificate, to the extent of the Available Distribution
Amount for Group II on such Distribution Date:
(i) first, to the Class IIA-P Certificates the sum of the
Group II Discount Fractional Principal Amounts for such
Distribution Date, until its Class Principal Balance has
been reduced to zero;
(ii) second, to the Class IIA Certificates (excluding the Class
IIA-P Certificates) and Class R Certificate previously
unpaid and then current Interest Distribution Amounts, pro
rata, according to such amount payable to the extent of
amounts available;
-16-
(iii) third, to the Class IIA Certificates and Class R
Certificate (other than the Class IIA-6, Class IIA-X
and Class IIA-P Certificates), the Group II Senior
Principal Amount, pro rata, according to their respective
Class Principal Balances, until their respective
outstanding Class Principal Balances have been reduced to
zero;
(iv) fourth, to the Class IIA Certificates (other than the
Class IIA-6 Certificates and Class IIA-X Certificates),
and the Class R Certificate, pro rata, according to their
respective Class Principal Balances, the amount of
unreimbursed Realized Losses previously allocated to such
Class; and
(v) fifth, to the Class R Certificate, the remainder, if any,
of the Available Distribution Amount for Loan Group II for
such Distribution Date.
CERTIFICATE PRINCIPAL BALANCE: For each Certificate of any Class, the
portion of the related Class Principal Balance, if any, represented by such
Certificate.
CERTIFICATE REGISTER AND CERTIFICATE REGISTRAR: The register maintained
and the registrar appointed, respectively, pursuant to Section 5.3. Initially,
the Certificate Registrar shall be LaSalle Bank National Association.
CERTIFICATEHOLDER OR HOLDER: The person in whose name a Certificate is
registered in the Certificate Register, except that, solely for the purposes of
giving any consent pursuant to this Agreement, any Certificate registered in the
name of the Depositor, the Certificate Administrator, a Servicer or any
Affiliate thereof shall be deemed not to be outstanding and the Percentage
Interest evidenced thereby shall not be taken into account in determining
whether the requisite percentage of Percentage Interests necessary to effect any
such consent has been obtained; provided, that the Trustee, the Certificate
Registrar and the Paying Agent may conclusively rely upon an Officer's
Certificate to determine whether any Person is an Affiliate of the Depositor,
the Certificate Administrator or a Servicer.
CERTIFICATEHOLDERS' REPORT: As defined in Section 4.2(a).
CLASS: All Certificates having the same priority and rights to payments
from the applicable Available Distribution Amount, designated as a separate
Class, as set forth in the forms of Certificates attached hereto as Exhibits A
and B.
CLASS A CERTIFICATES: The Class IA Certificates and Class IIA
Certificates, collectively.
CLASS IA CERTIFICATES: The Class IA-1, Class IA-2, Class IA-3, Class
IA-4, Class IA-5, Class IA-6, Class IA-7, Class IA-8, Class IA-9, Class IA-10,
Class IA-11, Class IA-12, Class IA-13, Class IA-14, Class IA-15, Class IA-16,
Class IA-17, Class IA-18, Class IA-19, Class IA-20, Class IA-21, Class IA-22,
Class IA-23, Class IA-24, Class IA-25, Class IA-26, Class IA-27, Class IA-28,
Class
-17-
IA-29, Class IA-30, Class IA-P and Class IA-X Certificates, collectively, and
designated as such on the face thereof in substantially the form attached hereto
as Exhibit A.
CLASS IA-1 PRIORITY AMOUNT I: With respect to any Distribution Date,
will be an amount equal to $84,968,000, reduced, as of the date of each
allocation of a Realized Loss, if any, to the IA-1 Certificates, by the product
of (a) any such Realized Loss and (b) a fraction, (x) the numerator of which is
equal to (i) $84,968,000, minus (ii) any prior allocations of Realized Losses
pursuant to this definition and (iii) the amounts previously allocated to the
Class IA-1 Certificates under clause (I)(A)(iii)(2)(a)(i) of the definition of
Certificate Distribution Amount, (y) the denominator of which is the outstanding
Class Principal Balance of the Class IA-1 Certificates as of the date of such
allocation.
CLASS IA-1 PRIORITY AMOUNT II: For any Distribution Date, will be an
amount equal to $11,620,000, reduced, as of the date of each allocation of a
Realized Loss, if any, to the IA-1 Certificates, by the product of (a) any such
Realized Loss and (b) a fraction, (x) the numerator of which is equal to (i)
$11,620,000, minus (ii) any prior allocations of Realized Losses pursuant to
this definition and (iii) the amounts previously allocated to the Class IA-1
Certificates under clause (I)(A)(iii)(2)(b)(i)(3)(a) of the definition of
Certificate Distribution Amount, (y) the denominator of which is the outstanding
Class Principal Balance of the Class IA-1 Certificates as of the date of such
allocation.
Class IA-2 Notional Amount: As of the Closing Date, $49,382,863 and
thereafter, with respect to any Distribution Date, will be equal to (a) the sum
of (i) 1.50% of the Class Principal Balance of the Class IA-1 Certificates, (ii)
1.25% of the Class Principal Balance of the Class IA-25 Certificates, (iii)
1.75% of the Class Principal Balance of the Class IA-29 Certificates and (iv)
0.75% of the Class Principal Balance of the Class IA-30 Certificates, divided by
(b) 5.50%. For federal income tax purposes, however, the Class IA-2 Notional
Amount is equal to the sum of (i) the principal balance of REMIC I Regular
Interest LTI-I-A1 (such portion of the Class IA-2 Notional Amount shall be
multiplied by a rate equal to 1.50%), (ii) the principal balance of REMIC I
Regular Interest LTI-I-A25 (such portion of the Class IA-2 Notional Amount shall
be multiplied by a rate equal to 1.25%), (iii) the principal balance of REMIC I
Regular Interest LTI-I-A29 (such portion of the Class IA-2 Notional Amount shall
be multiplied by a rate equal to 1.75%), and (iv) the principal balance of the
REMIC I Regular Interest LTI-I-A30 (such portion of the Class IA-2 Notional
Amount shall be multiplied by a rate equal to 0.75%).
CLASS IA-13 INTEREST RATE: With respect to any Distribution Date on or
prior to the Distribution Date in November 2004 is 2.750% per annum, and as to
any Distribution Date thereafter, will be a per annum rate equal to LIBOR plus
0.75% (subject to a maximum rate of 8.00% per annum and a minimum rate of 0.75%
per annum).
CLASS IA-14 INTEREST RATE: With respect to any Distribution Date on or
prior to the Distribution Date in November 2004 is 10.202899% per annum, and as
to any Distribution Date thereafter, will be a per annum rate equal to
15.304349% minus the product of LIBOR and 2.550725 (subject to a maximum rate of
15.304349% per annum and a minimum rate of 0.00% per annum).
CLASS IA-15 INTEREST RATE: With respect to any Distribution Date on or
prior to the Distribution Date in November 2004 is 20.000% per annum, and as to
any Distribution Date
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thereafter, will be a per annum rate equal to 116.00% minus the product of LIBOR
and 16.00 (subject to a maximum rate of 20.00% per annum and a minimum rate of
0.00% per annum).
CLASS IA-16 INTEREST RATE: With respect to any Distribution Date on or
prior to the Distribution Date in November 2004 is 2.50% per annum, and as to
any Distribution Date thereafter, will be a per annum rate equal to LIBOR plus
0.50% (subject to a maximum rate of 9.00% per annum and a minimum rate of 0.50%
per annum).
CLASS IA-17 INTEREST RATE: With respect to any Distribution Date on or
prior to the Distribution Date in November 2004 is 11.144731% per annum, and as
to any Distribution Date thereafter, will be a per annum rate equal to
15.197360% minus the product of LIBOR and 2.2026315 (subject to a maximum rate
of 15.197360% per annum and a minimum rate of 0.00% per annum).
CLASS IA-18 INTEREST RATE: With respect to any Distribution Date on or
prior to the Distribution Date in November 2004 is 7.00% per annum, and as to
any Distribution Date thereafter, will be a per annum rate equal to 59.499880%
minus the product of LIBOR and 6.999984 (subject to a maximum rate of 7.00% per
annum and a minimum rate of 0.00% per annum).
CLASS IA-19 INTEREST RATE: With respect to the initial Distribution
Date is 2.57% per annum, and as to any Distribution Date thereafter, will be a
per annum rate equal to LIBOR plus 1.25% (subject to a maximum rate of 7.50% per
annum and a minimum rate of 1.25% per annum).
CLASS IA-20 INTEREST RATE: With respect to the initial Distribution
Date is 13.381082% per annum, and as to any Distribution Date thereafter, will
be a per annum rate equal to 17.155233% minus the product of LIBOR and 2.859205
(subject to a maximum rate of 17.155233% per annum and a minimum rate of 0.00%
per annum).
CLASS IA-21 INTEREST RATE: With respect to the initial Distribution
Date is 18.00% per annum, and as to any Distribution Date thereafter, will be a
per annum rate equal to 449.999405% minus the product of LIBOR and 71.999901
(subject to a maximum rate of 18.00% per annum and a minimum rate of 0.00% per
annum).
CLASS IA-22 INTEREST RATE: With respect to the initial Distribution
Date is 8.43% per annum, and as to any Distribution Date thereafter, will be a
per annum rate equal to 9.75% minus LIBOR (subject to a maximum rate of 9.75%
per annum and a minimum rate of 3.50% per annum).
CLASS IA-23 INTEREST RATE: With respect to the initial Distribution
Date is 13.934429% per annum, and as to any Distribution Date thereafter, will
be a per annum rate equal to 17.864653% minus the product of LIBOR and 2.977442
(subject to a maximum rate of 17.864653% per annum and a minimum rate of 0.00%
per annum).
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CLASS IA-24 INTEREST RATE: With respect to the initial Distribution
Date is 9.00% per annum, and as to any Distribution Date thereafter, will be a
per annum rate equal to 224.999318% minus the product of LIBOR and 35.999886
(subject to a maximum rate of 9.00% per annum and a minimum rate of 0.00% per
annum).
CLASS IA-X NOTIONAL AMOUNT: As of the Closing Date, $82,407, and
thereafter, with respect to any Distribution Date will equal the total Principal
Balance, as of the first day of the month preceding such Distribution Date
(after giving effect to all payments scheduled to be made on such Distribution
Date whether or not received), of the Group I Premium Loans multiplied by the
following fraction:
the weighted average of the Pass-Through Rates of the
Group I Premium Loans as of the first day of such month minus 5.50%
-------------------------------------------------------------------
5.50%.
CLASS IIA-3 ACCRUAL AMOUNT: The amount of accrued interest on the Class
IIA-3 Certificates for such Distribution Date to the extent distributed to the
Class IIA-1 Certificates on such Distribution Date as set forth in clause
(I)(C)(ii) of the definition of Certificate Distribution Amount.
CLASS IIA-5 INTEREST RATE: With respect to the initial Distribution
Date is 1.57% per annum, and as to any Distribution Date thereafter, will be a
per annum rate equal to LIBOR plus 0.25% (subject to a maximum rate of 8.00% per
annum and a minimum rate of 0.25% per annum).
CLASS IIA-6 INTEREST RATE: With respect to the initial Distribution
Date is 6.43% per annum, and as to any Distribution Date thereafter, will be a
per annum rate equal to 7.75% minus LIBOR (subject to a maximum rate of 7.75%
per annum and a minimum rate of 0.00% per annum).
CLASS IIA-6 NOTIONAL AMOUNT: As of the Closing Date, $14,970,028 and
thereafter, with respect to any Distribution Date, will be equal to the Class
Principal Balance of the Class IIA-5 Certificates. For federal income tax
purposes, however, the Class IIA-6 Notional Amount is equal to the principal
balance of the REMIC II Regular Interest LTII-II-A5.
CLASS IIA CERTIFICATES: The Class IIA-1, Class IIA-2, Class IIA-3,
Class IIA-4, Class IIA-5, Class IIA-6, Class IIA-7, Class IIA-8, IIA-P and IIA-X
Certificates, collectively, and designated as such on the face thereof in
substantially the form attached hereto as Exhibit A.
CLASS IIA-X NOTIONAL AMOUNT: As of the Closing Date, $12,006,907, and
thereafter, with respect to any Distribution Date will equal the total Principal
Balance, as of the first day of the month preceding such Distribution Date
(after giving effect to all payments scheduled to be made on such Distribution
Date whether or not received), of the Group II Premium Loans multiplied by the
following fraction:
the weighted average of the Pass-Through Rates of the
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Group II Premium Loans as of the first day of such month minus 4.729954229%
---------------------------------------------------------------------------
4.75%
CLASS NOTIONAL AMOUNT: With respect to the Class IA-2, Class IIA-6,
Class IA-X and Class IIA-X Certificates, the Class IA-2 Notional Amount, the
Class IIA-6 Notional Amount, the Class IA-X Notional Amount and the Class IIA-X
Notional Amount, respectively.
CLASS PRINCIPAL BALANCE: For any Class of Certificates (other than the
Interest Only Certificates), the applicable initial Class Principal Balance set
forth in the Preliminary Statement hereto, corresponding to the rights of such
Class in payments of principal due to be passed through to Certificateholders
from principal payments on the Loans, as reduced from time to time by (x)
distributions of principal to Certificateholders of such Class and (y) the
portion of Realized Losses allocated to the Class Principal Balance of such
Class pursuant to Section 3.20 with respect to a given Distribution Date. For
any Distribution Date, the reduction of the Class Principal Balance of any Class
of Certificates pursuant to Section 3.20 shall be deemed effective prior to the
determination and distribution of principal on such Class pursuant to the
definition of "Certificate Distribution Amount". Notwithstanding the foregoing,
the Class Principal Balance of the most subordinate Class of Certificates
outstanding at any time shall be equal to the aggregate Scheduled Principal
Balance of all of the Loans less the Class Principal Balance of all other
Classes of Certificates. The Class Principal Balance for the Class A-1
Certificates shall be referred to as the "Class A-1 Principal Balance", the
Class Principal Balance for the Class IA-P Certificates shall be referred to as
the "Class IA-P Principal Balance" and so on. The Class Principal Balance of the
Interest Only Certificates shall be zero.
CLASS R CERTIFICATE: The Certificate designated as "Class R" on the
face thereof in substantially the form attached hereto as Exhibit B, that is
composed of Components R-1, R-2 and R-3, each of which has been designated as
the sole class of "residual interests" in REMIC I, REMIC II and REMIC III,
respectively, pursuant to Section 2.1
CLASS R CERTIFICATEHOLDER: The registered Holder of the Class R
Certificate.
CLEARING AGENCY: An organization registered as a "clearing agency"
pursuant to Section 17A of the Securities and Exchange Act of 1934, as amended,
which initially shall be DTC.
CLOSING DATE: May 28, 2003.
CODE: The Internal Revenue Code of 1986, as amended.
COMPENSATING INTEREST: For any Distribution Date, with respect to the
Group I or Group II Loans, as determined separately for each Loan Group,
contained therein,
(A) with respect to the Group I Loans:
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the lesser of (i) the sum of (a) one-twelfth of 0.03% of the
aggregate outstanding Principal Balance of the Group I Loans as
of the related Due Date preceding such Distribution Date, (b) the
aggregate Payoff Earnings on the related Group I Loans for such
Distribution Date and (c) the aggregate Payoff Interest on the
related Group I Loans for such Distribution Date and (ii) the
aggregate Uncollected Interest on the related Group I Loans; and
(B) with respect to the Group II Loans:
the lesser of (i) the sum of (a) one-twelfth of 0.125% of the
aggregate outstanding Principal Balance of the Group II Loans as
of the related Due Date and (b) the aggregate Payoff Earnings on
the related Group II Loans for such Distribution Date and (ii)
the aggregate Uncollected Interest on the related Group II Loans
for such Distribution Date.
CORPORATE TRUST OFFICE: The corporate trust office of the Trustee in
the State of Texas, at which at any particular time its corporate trust business
with respect to this Agreement shall be administered, which office at the date
of the execution of this Agreement is located at 000 Xxxxxx Xxxxxx, 0xx Xxxxx,
Xxxxxxx, Xxxxx 00000, Attention: Xxxxx Xxxxxxx.
CORRESPONDING CLASS: With respect to REMIC I Regular Interest LTI-I-A1,
the Class IA-1 Certificates; with respect to REMIC I Regular Interest LTI-I-A3,
the Class IA-3 Certificates; with respect to REMIC I Regular Interest LTI-I-A4,
the Class IA-4 Certificates; with respect to the REMIC I Regular Interest
LTI-I-A5, the Class IA-5 Certificates; with respect to the REMIC I Regular
Interest LTI-I-A6, the Class IA-6 Certificates; with respect to the REMIC I
Regular Interest LTI-I-A7, the Class IA-7 Certificates; with respect to the
REMIC I Regular Interest LTI-I-A8, the Class IA-8 Certificates; with respect to
the REMIC I Regular Interest LTI-I- A9, the Class IA-9 Certificates; with
respect to REMIC I Regular Interest LTI-I-A10, the Class IA-10 Certificates;
with respect to REMIC I Regular Interest LTI-I-A11, the Class IA-11
Certificates; with respect to REMIC I Regular Interest LTI-I-A12, the Class
IA-12 Certificates; with respect to REMIC I Regular Interest LTI-I-A13, the
Class IA-13 Certificates; with respect to the REMIC I Regular Interest
LTI-I-A14, the Class IA-14 Certificates; with respect to the REMIC I Regular
Interest LTI-I-A15, the Class IA- 15 Certificates; with respect to the REMIC I
Regular Interest LTI-I-A16, the Class IA-16 Certificates; with respect to the
REMIC I Regular Interest LTI-I-A17, the Class IA-17 Certificates; with respect
to the REMIC I Regular Interest LTI-I- A18, the Class IA-18 Certificates; with
respect to REMIC I Regular Interest LTI-I-A19, the Class IA-19 Certificates;
with respect to REMIC I Regular Interest LTI-I-A20, the Class IA-20
Certificates; with respect to REMIC I Regular Interest LTI-I-A21, the Class
IA-21 Certificates; with respect to REMIC I Regular Interest LTI-I-A22, the
Class IA-22 Certificates; with respect to the REMIC I Regular Interest
LTI-I-A23, the Class IA-23 Certificates; with respect to the REMIC I Regular
Interest LTI-I-A24, the Class IA-24 Certificates; with respect to the REMIC I
Regular Interest LTI-I-A25, the Class IA-25 Certificates; with respect to the
REMIC I Regular Interest LTI-I-A26, the Class IA-26 Certificates; with respect
to the REMIC I Regular Interest LTI-I- A27, the Class IA-27 Certificates; with
respect to REMIC I Regular Interest
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LTI-I-A28, the Class IA-28 Certificates; with respect to the REMIC I Regular
Interest LTI-I- A29, the Class IA-29 Certificates; with respect to REMIC I
Regular Interest LTI-I-A30, the Class IA-30 Certificates; with respect to the
REMIC I Regular Interest LTI-I- PO, the Class IA-P Certificates; with respect to
REMIC I Regular Interest LTI-I-IO, the Class IA-X Certificates; with respect to
REMIC II Regular Interest LTII-II-A1, the Class IIA-1 Certificates; with respect
to REMIC II Regular Interest LTII-II-A2, the Class IIA-2 Certificates; with
respect to REMIC II Regular Interest LTII-II-A3, the Class IIA-3 Certificates;
with respect to the REMIC II Regular Interest LTII-II-A4, the Class IIA-4
Certificates; with respect to REMIC II Regular Interest LTII-II-A5, the Class
IIA-5 Certificates; with respect to REMIC II Regular Interest LTII-II-A7, the
Class IIA-7 Certificates; with respect to REMIC II Regular Interest LTII-II-A8,
the Class IIA-8 Certificates; with respect to the REMIC II Regular Interest
LTII-II-PO, the Class IIA-P Certificates; with respect to the REMIC II Regular
Interest LTII-II-IO, the Class IIA-X Certificates; with respect to REMIC I
Regular Interest LTI-I-SUB and REMIC II Regular Interest LTII-II-SUB, the Class
M, Class B-1, Class B-2, Class B-3, Class B-4 and Class B-5 Certificates.
CREDIT SUPPORT DEPLETION DATE: The first Distribution Date on which the
aggregate of the Class Principal Balances of the Subordinate Certificates has
been or will be reduced to zero as a result of principal distributions thereon
and the allocation of Realized Losses on such Distribution Date.
CURTAILMENT: Any payment of principal on a Loan, made by or on behalf
of the related Mortgagor, other than a Monthly Payment, a Prepaid Monthly
Payment or a Payoff, which is applied to reduce the outstanding Principal
Balance of the Loan.
CURTAILMENT SHORTFALL: With respect to any Curtailment applied with a
Monthly Payment, an amount equal to one month's interest on such Curtailment at
the applicable Pass-Through Rate on such Loan.
CUSTODIAL ACCOUNT FOR P&I: The custodial account for principal and
interest established and maintained by, or at the direction of, each Servicer
and caused by such Servicer to be established and maintained pursuant to Section
3.2(b) (i) with the corporate trust department of the Trustee or another
financial institution approved by a Servicer such that the rights of such
Servicer, the Trustee and the Certificateholders thereto shall be fully
protected against the claims of any creditors of such Servicer and of any
creditors or depositors of the institution in which such account is maintained,
(ii) within FDIC insured accounts (or other accounts with comparable insurance
coverage acceptable to each Rating Agency) created and maintained, by or at the
direction of a Servicer, and monitored by such Servicer or (iii) in a separate
non-trust account without FDIC or other insurance in an Eligible Institution. In
the event that a Custodial Account for P&I is established pursuant to clause
(ii) of the preceding sentence, amounts held in such Custodial Account for P&I
shall not exceed the level of deposit insurance coverage on such account;
accordingly, more than one Custodial Account for P&I may be established.
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CUSTODIAL AGREEMENT: The agreement, if any, among a Servicer, the
Trustee and a Custodian providing for the safekeeping of the Mortgage Files on
behalf of the Certificateholders.
CUSTODIAN: A custodian which is appointed pursuant to a Custodial
Agreement. Any Custodian so appointed shall act as agent on behalf of the
Trustee, and shall be compensated by the Trustee at no additional charge to the
Servicers. The Trustee shall remain at all times responsible under the terms of
this Agreement, notwithstanding the fact that certain duties have been assigned
to a Custodian.
CUT-OFF DATE: May 1, 2003.
DATA: As defined in Section 8.14.
DEFAULTED LOAN: As of any Determination Date, any Loan for which any
payment of principal of or interest on such Loan is more than 89 days past due,
determined without giving effect to any grace period permitted by the related
Mortgage or Mortgage Note or any other document in the Mortgage File.
DEFINITIVE CERTIFICATES: As defined in Section 5.7.
DENOMINATION: The amount specified on a Certificate as representing the
aggregate Principal Balance of the Loans as of the Cut-Off Date evidenced by
such Certificate.
DEPOSITOR: ABN AMRO Mortgage Corporation, a Delaware corporation, or
its successor-in-interest.
DEPOSITORY: DTC or any successor thereto.
DEPOSITORY AGREEMENT: The Letter of Representations, dated May 28, 2003
by and among DTC, the Depositor and the Trustee.
DETERMINATION DATE: A day not later than the 10th day (or, if such 10th
day is not a Business Day, the Business Day immediately succeeding such 10th
day) preceding a related Distribution Date in the month in which such
Distribution Date occurs, as determined by the related Servicer.
DISQUALIFIED ORGANIZATION: A "disqualified organization" as defined in
Section 860E(e)(5) of the Code, and, for purposes of Section 5.1 herein, as
defined in Section 5.1(b).
DISTRIBUTION DATE: With respect to distributions on the Certificates,
the 25th day (or, if such 25th day is not a Business Day, the Business Day
immediately succeeding such 25th day) of each month, with the first such date
being June 25, 2003. The "related Due Date" for any Distribution Date is the Due
Date immediately preceding such Distribution Date.
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DTC: The Depository Trust Company.
DTC PARTICIPANT: A broker, dealer, bank, other financial institution or
other Person for whom DTC effects book-entry transfers and pledges of securities
deposited with DTC.
DUE DATE: The first day of each calendar month, which is the day on
which the Monthly Payment for each Loan is due.
ELIGIBLE ACCOUNT: Any account or accounts held and established by a
Servicer or the Trustee or Certificate Administrator on behalf of the Trustee in
trust for the Certificateholders at any Eligible Institution, or any trust
account or accounts maintained with the trust department of a federal or state
chartered depository institution or trust company acting in its fiduciary
capacity.
ELIGIBLE INSTITUTION: An institution having (i) the highest short-term
debt rating, and one of the two highest long-term debt ratings of each Rating
Agency, (ii) with respect to any Custodial Account for P&I, an unsecured
long-term debt rating of at least one of the two highest unsecured long-term
debt ratings of each Rating Agency, or (iii) the approval of each Rating Agency.
Notwithstanding the foregoing, with respect to any account established and
maintained by WMMSC, Washington Mutual Bank, FA shall be an "Eligible
Institution" if the following conditions are satisfied: (i) Washington Mutual
Bank, FA is acting as Servicer, (ii) if S&P is a Rating Agency as defined
herein, the long-term unsecured debt obligations of Washington Mutual Bank, FA
are rated no lower than "A-" by S&P and the short-term unsecured debt
obligations of Washington Mutual Bank, FA are rated no lower than "A-2" by S&P,
(iii) if Fitch is the Rating Agency as defined herein, the long-term unsecured
debt obligations of Washington Mutual Bank, FA are rated no lower than "A" by
Fitch and the short-term unsecured debt obligations of Washington Mutual Bank,
FA are rated no lower than "F1" by Fitch and (iv) if Xxxxx'x is a Rating Agency
as defined herein, the long- term unsecured debt obligations of Washington
Mutual Bank, FA are rated no lower than "A2" by Moody's and the short-term
unsecured debt obligations of Washington Mutual Bank, FA are rate no lower than
"P-1" by Moody's; PROVIDED, that if the long-term or short-term unsecured debt
obligations of Washington Mutual Bank, FA are downgraded by any of the Rating
Agencies to a rating lower than the applicable rating specified in this
sentence, Washington Mutual Bank, FA shall cease to be an "Eligible Institution"
ten Business Days after notification of such downgrade.
ELIGIBLE INVESTMENTS: Any one or more of the following obligations or
securities payable on demand or having a scheduled maturity on or before the
Business Day preceding the following Distribution Date, (or with regard to the
Certificate Account maintained with the Trustee or the Certificate
Administrator, having a scheduled maturity on or before the following
Distribution Date; provided that, such Eligible Investments shall be managed by,
or be an obligation of, the institution that maintains the Certificate Account
if such Eligible Investments mature on the Distribution Date) regardless of
whether issued by the Depositor, a Servicer, the Trustee or any of their
respective Affiliates and having at the time of purchase, or at such other time
as may be specified, the required ratings, if any, provided for in this
definition:
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(a) direct obligations of, or guaranteed as to full and timely
payment of principal and interest by, the United States or any agency
or instrumentality thereof, provided, that such obligations are backed
by the full faith and credit of the United States of America;
(b) direct obligations of, or guaranteed as to timely payment
of principal and interest by, FHLMC, FNMA or the Federal Farm Credit
System, provided, that any such obligation, at the time of purchase or
contractual commitment providing for the purchase thereof, is qualified
by each Rating Agency as an investment of funds backing securities
rated "AAA" in the case of Fitch and "Aaa" in the case of Moody's (the
initial rating of the Class A Certificates);
(c) demand and time deposits in or certificates of deposit of,
or bankers' acceptances issued by, any bank or trust company, savings
and loan association or savings bank, provided, that the short-term
deposit ratings and/or long-term unsecured debt obligations of such
depository institution or trust company (or in the case of the
principal depository institutions in a holding company system, the
commercial paper or long-term unsecured debt obligations of such
holding company) have, in the case of commercial paper, the highest
rating available for such securities by each Rating Agency and, in the
case of long-term unsecured debt obligations, one of the two highest
ratings available for such securities by each Rating Agency, or in each
case such lower rating as will not result in the downgrading or
withdrawal of the rating or ratings then assigned to any Class of
Certificates by any Rating Agency but in no event less than the initial
rating of the Senior Certificates;
(d) general obligations of or obligations guaranteed by any
state of the United States or the District of Columbia receiving one of
the two highest long-term debt ratings available for such securities by
each Rating Agency, or such lower rating as will not result in the
downgrading or withdrawal of the rating or ratings then assigned to any
Class of Certificates by any Rating Agency;
(e) commercial or finance company paper (including both
non-interest-bearing discount obligations and interest-bearing
obligations payable on demand or on a specified date not more than one
year after the date of issuance thereof) that is rated by each Rating
Agency in its highest short-term unsecured rating category at the time
of such investment or contractual commitment providing for such
investment, and is issued by a corporation the outstanding senior
long-term debt obligations of which are then rated by each Rating
Agency in one of its two highest long-term unsecured rating categories,
or such lower rating as will not result in the downgrading or
withdrawal of the rating or ratings then assigned to any Class of
Certificates by any Rating Agency but in no event less than the initial
rating of the Senior Certificates;
(f) guaranteed reinvestment agreements issued by any bank,
insurance company or other corporation rated in one of the two highest
rating levels available to such issuers by each Rating Agency at the
time of such investment, provided, that any such agreement must
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by its terms provide that it is terminable by the purchaser without
penalty in the event any such rating is at any time lower than such
level;
(g) repurchase obligations with respect to any security
described in clause (a) or (b) above entered into with a depository
institution or trust company (acting as principal) meeting the rating
standards described in (c) above;
(h) 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 rated by each Rating Agency
in one of its two highest long-term unsecured rating categories at the
time of such investment or contractual commitment providing for such
investment; provided, however, that securities issued by any such
corporation will not be Eligible Investments to the extent that
investment therein would cause the outstanding principal amount of
securities issued by such corporation that are then held as part of the
Certificate Account to exceed 20% of the aggregate principal amount of
all Eligible Investments then held in the Certificate Account;
(i) units of taxable money market funds (including those for
which the Trustee or any affiliate thereof receives compensation with
respect to such investment) which funds have been rated by each Rating
Agency in its highest rating category or which have been designated in
writing by each Rating Agency as Eligible Investments with respect to
this definition;
(j) if previously confirmed in writing to the Trustee, any
other demand, money market or time deposit, or any other obligation,
security or investment, as may be acceptable to each Rating Agency as a
permitted investment of funds backing securities having ratings
equivalent to the initial rating of the Class A Certificates; and
(k) such other obligations as are acceptable as Eligible
Investments to each Rating Agency;
provided, however, that such instrument continues to qualify as a "cash flow
investment" pursuant to Code Section 860G(a)(6) and that no instrument or
security shall be an Eligible Investment if (i) such instrument or security
evidences a right to receive only interest payments or (ii) the right to receive
principal and interest payments derived from the underlying investment provides
a yield to maturity in excess of 120% of the yield to maturity at par of such
underlying investment.
ERISA: The Employee Retirement Income Security Act of 1974, as amended.
ESCROW ACCOUNT: As defined in Section 3.4.
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ESCROW PAYMENT: Any payment received by a Servicer for the account of
any Mortgagor for application toward the payment of taxes, insurance premiums,
assessments and similar items in respect of the related Mortgaged Property.
EVENT OF DEFAULT: Any event of default as specified in Section 7.1.
EXCESS LIQUIDATION PROCEEDS: With respect to any Distribution Date, the
excess, if any, of aggregate Liquidation Proceeds in the applicable Prepayment
Period over the amount that would have been received if a Payoff had been made
on the last day of such applicable Prepayment Period with respect to each Loan
which became a Liquidated Loan during such applicable Prepayment Period.
EXCESS LOSS: A Special Hazard Loss incurred on a Loan in excess of the
Special Hazard Coverage, a Fraud Loss incurred on a Loan in excess of the Fraud
Coverage and a Bankruptcy Loss incurred on a Loan in excess of the Bankruptcy
Coverage.
EXCHANGE ACT: The Securities Exchange Act of 1934, as amended.
FDIC: Federal Deposit Insurance Corporation, or any successor thereto.
FEDERAL FUNDS RATE: means, for any day, the rate set forth in the
weekly statistical release designated as H.15(519), or any successor
publication, published by the Federal Reserve Bank of New York on the preceding
Business Day opposite the caption "Federal Funds (Effective)"; or, if for any
relevant day such rate is not so published on any such preceding Business Day,
the rate for such day will be the arithmetic mean as determined by the Trustee
of the rates for the last transaction in overnight Federal funds arranged before
9:00 a.m. (New York City time) on that day by each of three leading brokers of
Federal funds transactions in New York City selected by the Trustee.
FHA: Federal Housing Administration, or any successor thereto.
FHLMC: Federal Home Loan Mortgage Corporation, or any successor
thereto.
FINAL CERTIFICATION: The certification substantially in the form of
Exhibit C-2 attached hereto.
FITCH: Fitch, Inc., provided, that at any time it is a Rating Agency.
FNMA: Federal National Mortgage Association, or any successor thereto.
FRAUD COVERAGE: As of the Cut-Off Date approximately $6,989,335 and
thereafter, the Fraud Coverage will generally be equal to (1) prior to the third
Anniversary, an amount equal to (a) 1.00% of the aggregate Principal Balance of
all Loans, as of the Cut-Off Date minus (b) the aggregate amounts allocated to
the Certificates with respect to Fraud Losses on such Loans up to such date of
determination and (2) from the third to the fifth Anniversary, an amount equal
to (a) 0.50% of the
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aggregate Principal Balance of all of the Loans, as of the Due Date of the
calendar month preceding the most recent Anniversary minus (b) the aggregate
amounts allocated to the Certificates with respect to Fraud Losses on the Loans
since the most recent Anniversary up to such date of determination. On and after
the fifth Anniversary, the Fraud Coverage will be zero. The Fraud Coverage may
be reduced upon written confirmation from each Rating Agency that such reduction
will not adversely affect the then current ratings assigned to the Certificates
by each Rating Agency.
FRAUD LOSS: The occurrence of a loss on a Loan arising from any action,
event or state of facts with respect to such Loan which, because it involved or
arose out of any dishonest, fraudulent, criminal, negligent or knowingly
wrongful act, error or omission by the Mortgagor, originator (or assignee
thereof) of such Loan, Lender, or a Servicer, would result in an exclusion from,
denial of, or defense to coverage which otherwise would be provided by an
insurance policy previously issued with respect to such Loan.
GROUP OF LOANS: means the Group I Loans or the Group II Loans, as the
context requires.
GROUP I DISCOUNT FRACTION: For any Group I Discount Loan, the following
fraction:
5.50% - the Pass-Through Rate on such Group I Discount Loan
-----------------------------------------------------------
5.50%
GROUP I DISCOUNT FRACTIONAL PRINCIPAL AMOUNT: On each Distribution
Date, an amount equal to the product of the Group I Discount Fraction multiplied
by the sum of (i) scheduled payments of principal on each Group I Discount Loan
due on or before the related Due Date in respect of which no distribution has
been made on any previous Distribution Date and which were received by the
Determination Date, or which have been advanced as part of an Advance with
respect to such Distribution Date, (ii) the principal portion received in
respect of each Group I Discount Loan during the Prepayment Period of (a)
Curtailments, (b) Insurance Proceeds, (c) the amount, if any, of the principal
portion of the Purchase Price pursuant to a Purchase Obligation or any
repurchase of a Group I Discount Loan permitted hereunder and (d) Liquidation
Proceeds and (iii) the principal portion of Payoffs received in respect of each
Group I Discount Loan during the applicable Prepayment Period.
GROUP I DISCOUNT FRACTIONAL PRINCIPAL SHORTFALL: For any Distribution
Date, an amount equal to the Group I Discount Fraction of any Realized Loss on a
Group I Discount Loan, other than a Special Hazard Loss, Fraud Loss or
Bankruptcy Loss in excess of the Special Hazard Coverage, Fraud Coverage or
Bankruptcy Coverage.
GROUP I DISCOUNT LOAN: The Group I Loans having Pass-Through Rates of
less than 5.50%.
GROUP I LOAN: The Loans designated on the Loan Schedule as Group I
Loans.
GROUP I PREMIUM LOANS: All Group I Loans having Pass-Through Rates in
excess of 5.50%.
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GROUP I SENIOR LIQUIDATION AMOUNT: The aggregate, for each Group I Loan
which became a Liquidated Loan during the applicable Prepayment Period, of the
lesser of: (i) the Group I Senior Percentage of the Principal Balance of such
Group I Loan (exclusive of the Group I Discount Fraction thereof, if
applicable), and (ii) the Group I Senior Prepayment Percentage of the
Liquidation Principal with respect to such Group I Loan.
GROUP I SENIOR PERCENTAGE: As of the Closing Date, approximately
97.74%, and thereafter, with respect to any Distribution Date, the Class
Principal Balances of the Class IA Certificates (other than the Class IA-P
Certificates) divided by the aggregate Scheduled Principal Balance of all of the
Group I Loans, in each case immediately prior to such Distribution Date
(exclusive of the Group I Discount Fraction of the Group I Discount Loans).
GROUP I SENIOR PREPAYMENT PERCENTAGE: (i) On any Distribution Date
occurring before the Distribution Date in the month of June 2008, 100%; (ii) on
any other Distribution Date on which (x) the Group I Senior Percentage for such
Distribution Date exceeds the initial Group I Senior Percentage or (y) the Group
II Senior Percentage for such Distribution Date exceeds the initial Group II
Senior Percentage, 100%; and (iii) on any other Distribution Date in the month
of June 2008 and thereafter, 100%, unless:
(a) the mean aggregate Principal Balance of the Group I Loans
which are 60 or more days delinquent (including loans in foreclosure
and property held by the Trust Fund) for each of the immediately
preceding six calendar months is less than or equal to 50% of the Group
I Subordinate Amount as of such Distribution Date, and
(b) cumulative Realized Losses on the Group I Loans allocated
to the Subordinate Certificates are less than or equal to the following
amounts:
Percentage of the Group I Subordinate
Distribution Date Occurring In Amount as of the Cut-Off Date
---------------------------------- -------------------------------------
June 2008 through May 2009........ 30%
June 2009 through May 2010........ 35%
June 2010 through May 2011........ 40%
June 2011 through May 2012........ 45%
June 2012 and thereafter.......... 50%
(iv) upon the occurrence of both of the events described in
clauses (iii)(a) and (b) of the definition of "Group II Senior
Prepayment Percentage", the Group I Senior Prepayment Percentage shall
be as follows:
Distribution Date Occurring In Group I Senior Prepayment Percentage
--------------------------------- -----------------------------------------------------------------
June 2003 through May 2008....... 100%
June 2008 through May 2009....... Group I Senior Percentage + 70% of related Subordinate Percentage
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June 2009 through May 2010....... Group I Senior Percentage + 60% of related Subordinate Percentage
June 2010 through May 2011....... Group I Senior Percentage + 40% of related Subordinate Percentage
June 2011 through May 2012....... Group I Senior Percentage + 20% of related Subordinate Percentage
June 2012 and thereafter......... Group I Senior Percentage
If on any Distribution Date the allocation to the Class IA Certificates
of Principal Prepayments in the percentage required would reduce the sum of the
Class Principal Balances of the Class IA Certificates and the Subordinate
Certificates below zero, the Group I Senior Prepayment Percentage for such
Distribution Date shall be limited to the percentage necessary to reduce such
sum to zero. Notwithstanding the foregoing, however, on each Distribution Date,
the Class IA-P Certificates will receive the Group I Discount Fraction of all
principal payments, including, without limitation, Principal Prepayments,
received in respect of each Group I Discount Loan.
GROUP I SENIOR PRINCIPAL AMOUNT: For any Distribution Date, an amount
equal to the sum of (a) the Group I Senior Percentage of the Principal Payment
Amount for the Group I Loans (exclusive of the sum of the Group I Discount
Fractional Principal Amounts for such Distribution Date), (b) the Group I Senior
Prepayment Percentage of the Principal Prepayment Amount for the Group I Loans
(exclusive of the sum of the Group I Discount Fractional Principal Amounts for
such Distribution Date) and (c) the Group I Senior Liquidation Amount.
GROUP I SUBORDINATE AMOUNT: The excess of the aggregate Scheduled
Principal Balance of the Group I Loans (exclusive of the Group I Discount
Fractional Principal Amount) over the sum of the Certificate Principal Balances
of the Class IA Certificates (exclusive of the Certificate Principal Balance of
the Class IA-P Certificates).
GROUP I UNDERCOLLATERALIZED AMOUNT: For any Distribution Date is equal
to the sum of (i) the sum of (A) the amount, if any, by which the aggregate
Certificate Principal Balance of the Class IA Certificates (other than the Class
IA-P Certificates) exceeds the aggregate Scheduled Principal Balance of the
Group I Loans (exclusive of the Group I Discount Fraction of the Group I
Discount Loans), after giving effect to distributions to be made on such
Distribution Date and (B) 1/12 of the amount calculated in clause (i)(A) above
multiplied by 5.50% and (ii) any amounts payable but remaining unpaid to such
Class IA Certificates pursuant to clause (i) above of this definition of "Group
I Undercollateralized Amount" on any prior Distribution Dates, plus accrued
interest thereon at 5.50% per annum.
GROUP II DISCOUNT FRACTION: For any Group II Discount Loan, the
following fraction:
4.729954229% - the Pass-Through Rate on such Group II Discount Loan
-------------------------------------------------------------------
4.729954229%
GROUP II DISCOUNT FRACTIONAL PRINCIPAL AMOUNT: On each Distribution
Date, an amount equal to the product of the Group II Discount Fraction
multiplied by the sum of (i) scheduled payments of principal on each Group II
Discount Loan due on or before the related Due Date in respect of which no
distribution has been made on any previous Distribution Date and which were
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received by the Determination Date, or which have been advanced as part of an
Advance with respect to such Distribution Date, (ii) the principal portion
received in respect of each Group II Discount Loan during the Prepayment Period
of (a) Curtailments, (b) Insurance Proceeds, (c) the amount, if any, of the
principal portion of the Purchase Price pursuant to a Purchase Obligation or any
repurchase of a Group II Discount Loan permitted hereunder and (d) Liquidation
Proceeds and (iii) the principal portion of Payoffs received in respect of each
Group II Discount Loan during the applicable Prepayment Period.
GROUP II DISCOUNT FRACTIONAL PRINCIPAL SHORTFALL: For any Distribution
Date, an amount equal to the Group II Discount Fraction of any Realized Loss on
a Group II Discount Loan, other than a Special Hazard Loss, Fraud Loss or
Bankruptcy Loss in excess of the Special Hazard Coverage, Fraud Coverage or
Bankruptcy Coverage.
GROUP II DISCOUNT LOAN: The Group II Loans having Pass-Through Rates of
less than 4.729954229%.
GROUP II LOAN: The Loans designated on the Loan Schedule as Group II
Loans.
GROUP II PREMIUM LOANS: All Group II Loans having Pass-Through Rates in
excess of 4.729954229%.
GROUP II SENIOR LIQUIDATION AMOUNT: The aggregate, for each Group II
Loan which became a Liquidated Loan during the applicable Prepayment Period, of
the lesser of: (i) the Group II Senior Percentage of the Principal Balance of
such Group II Loan (exclusive of the Group II Discount Fraction thereof, if
applicable), and (ii) the Group II Senior Prepayment Percentage of the
Liquidation Principal with respect to such Group II Loan.
GROUP II SENIOR PERCENTAGE: As of the Closing Date, approximately
97.74%, and thereafter, with respect to any Distribution Date, the sum of the
Class Principal Balances of the Class IIA Certificates (other than the Class
IIA-P Certificates) and Class R Certificate divided by the aggregate Scheduled
Principal Balance of all of the Group II Loans, in each case immediately prior
to such Distribution Date (exclusive of the Group II Discount Fraction of the
Group II Discount Loans).
GROUP II SENIOR PREPAYMENT PERCENTAGE: (i) On any Distribution Date
occurring before the Distribution Date in the month of June, 2008, 100%; (ii) on
any other Distribution Date on which (x) the Group II Senior Percentage for such
Distribution Date exceeds the initial Group II Senior Percentage or (y) the
Group I Senior Percentage for such Distribution Date exceeds the initial Group I
Senior Percentage, 100%; (iii) on any other Distribution Date in the month of
June, 2008 and thereafter, 100%, unless:
(a) the mean aggregate Principal Balance of the Group II Loans
which are 60 or more days delinquent (including loans in foreclosure
and property held by the Trust Fund)
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for each of the immediately preceding six calendar months is less than
or equal to 50% of the Group II Subordinate Amount as of such
Distribution Date, and
(b) cumulative Realized Losses on the Group II Loans allocated
to the Group II Subordinate Certificates are less than or equal to the
following amounts:
Percentage of the Group II Subordinate
Distribution Date Occurring In Amount as of the Cut-Off Date
--------------------------------------- -------------------------------------
June 2008 through May 2009............. 30%
June 2009 through May 2010............. 35%
June 2010 through May 2011............. 40%
June 2011 through May 2012............. 45%
June 2012 and thereafter............... 50%
(iv) upon the occurrence of both of the events described in
clauses (iii)(a) and (b) of the definition of "Group II Senior
Prepayment Percentage", the Group II Senior Prepayment Percentage shall
be as follows:
Distribution Date Occurring In Group II Senior Prepayment Percentage
------------------------------------------ ------------------------------------------------------------------
June 2003 through May 2008................ 100%
June 2008 through May 2009................ Group II Senior Percentage + 70% of related Subordinate Percentage
June 2009 through May 2010................ Group II Senior Percentage + 60% of related Subordinate Percentage
June 2010 through May 2011................ Group II Senior Percentage + 40% of related Subordinate Percentage
June 2011 through May 2012................ Group II Senior Percentage + 20% of related Subordinate Percentage
June 2012 and thereafter.................. Group II Senior Percentage
If on any Distribution Date the allocation to the Class IIA
Certificates and Class R Certificate of Principal Prepayments in the percentage
required would reduce the sum of the Class Principal Balances of the Class IIA
Certificates and Class R Certificate below zero, the Group II Senior Prepayment
Percentage for such Distribution Date shall be limited to the percentage
necessary to reduce such sum to zero. Notwithstanding the foregoing, however, on
each Distribution Date, the Class IIA-P Certificates will receive the Group II
Discount Fraction of all Principal Prepayments, including, without limitation,
Principal Prepayments, received in respect of each Group II Discount Loan.
GROUP II SENIOR PRINCIPAL AMOUNT: For any Distribution Date, an amount
equal to the sum of (a) the Group II Senior Percentage of the Principal Payment
Amount for the Group II Loans (exclusive of the sum of the Group II Discount
Fractional Principal Amounts for such Distribution Date), (b) the Group II
Senior Prepayment Percentage of the Principal Prepayment Amount for the Group II
Loans (exclusive of the sum of the Group II Discount Fractional Principal
Amounts for such Distribution Date), and (c) the Group II Senior Liquidation
Amount.
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GROUP II SUBORDINATE AMOUNT: The excess of the aggregate Scheduled
Principal Balance of the Group II Loans (exclusive of the Group II Discount
Fractional Principal Amount) over the sum of Certificate Principal Balances of
the Class IIA Certificates (exclusive of the Certificate Principal Balance of
the Class IIA-P Certificates) and the Class R Certificate.
GROUP II UNDERCOLLATERALIZED AMOUNT: For any Distribution Date is equal
to the sum of (i) the sum of (A) the amount, if any, by which the aggregate
Certificate Principal Balance of the Class IIA Certificates (other than the
Class IIA-P Certificates) and Class R Certificate exceeds the aggregate
Scheduled Principal Balance of the Group II Loans (exclusive of the Group II
Discount Fraction of the Group II Discount Loans), after giving effect to
distributions to be made on such Distribution Date and (B) 1/12 of the amount
calculated in clause (i)(A) above multiplied by 4.729954229% and (ii) any
amounts payable but remaining unpaid to such Class IIA Certificates pursuant to
clause (i) above of this definition of "Group II Undercollateralized Amount" on
any prior Distribution Dates, plus accrued interest thereon at 4.729954229% per
annum.
INDEPENDENT: When used with respect to any specified Person, any such
Person who (i) is in fact independent of the Depositor and each Servicer, (ii)
does not have any direct financial interest or any material indirect financial
interest in the Depositor or either Servicer or any Affiliate of either and
(iii) is not connected with the Depositor or either Servicer as an officer,
employee, promoter, underwriter, trustee, partner, director or person performing
similar functions.
INDIRECT DTC PARTICIPANTS: Entities such as banks, brokers, dealers or
trust companies that clear through or maintain a custodial relationship with a
DTC Participant, either directly or indirectly.
INSURANCE PROCEEDS: Amounts paid or payable by the insurer under any
insurance policy (including any replacement policy permitted under this
Agreement), covering any Loan or Mortgaged Property, including, without
limitation, any flood insurance policy, primary mortgage insurance policy or
hazard insurance policy required pursuant to Section 3.5, any title insurance
policy required pursuant to Section 2.3, and any FHA insurance policy or VA
guaranty.
INTEREST ACCRUAL PERIOD: For all Classes of Certificates (other than
the Class IIA-5 Certificates and Class IIA-6 Certificates), the calendar month
preceding the month in which the Distribution Date occurs. The Interest Accrual
Period for the Class IIA-5 Certificates and Class IIA-6 Certificates for each
Distribution Date is the period from the 25th day of the month before the month
in which a Distribution Date occurs (or the Closing Date, in the case of the
first Distribution Date) through the 24th day of the month in which that
Distribution Date occurs.
INTEREST DISTRIBUTION AMOUNT: On any Distribution Date, for any Class
of Certificates (other than the Principal Only Certificates), the amount of
interest accrued on the respective Class Principal Balance or Class Notional
Amount, as applicable, at 1/12th of the related Remittance Rate for such Class
during the applicable Interest Accrual Period (computed on the basis of a
360-day year of twelve 30-day months), before giving effect to allocations of
Realized Losses with respect to the
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applicable Loan Group, for the applicable Prepayment Period or distributions to
be made on such Distribution Date, reduced by Uncompensated Interest Shortfall,
with respect to the applicable Loan Group, and the interest portion of Realized
Losses, with respect to the applicable Loan Group, allocated to such Class
pursuant to the definition of "Uncompensated Interest Shortfall" and Section
3.20.
INTEREST ONLY CERTIFICATES: The Class IA-2, Class IIA-6, Class IA-X and
Class IIA-X Certificates.
INTERESTED PERSON: The Depositor, the Servicers, any Holder of a
Certificate, or any Affiliate of any such Person.
INTERIM CERTIFICATION: The certification substantially in the form of
Exhibit C-1 attached hereto.
JUNIOR SUBORDINATE CERTIFICATES: The Class B-3, Class B-4 and Class B-5
Certificates, collectively.
LIBOR: The per annum rate established by the Trustee or the Certificate
Administrator, if any, in accordance with Section 8.15.
LIBOR BUSINESS DAY: Any day on which dealings in United States dollars
are transacted in the London interbank market.
LIBOR DETERMINATION DATE: The second LIBOR Business Day before the
first day of the related Interest Accrual Period.
LIQUIDATED LOAN: A Loan as to which a Servicer has determined in
accordance with its customary servicing practices that all amounts which it
expects to recover from or on account of such Loan, whether from Insurance
Proceeds, Liquidation Proceeds or otherwise, have been recovered. For purposes
of this definition, acquisition of a Mortgaged Property by the Trust Fund shall
not constitute final liquidation of the related Loan.
LIQUIDATION EXPENSES: Reasonable out of pocket expenses incurred by a
Servicer in connection with the liquidation of any Defaulted Loan or property
acquired in respect thereof, including, without limitation, legal fees and
expenses, any unreimbursed amount expended by such Servicer pursuant to Section
3.7 respecting the related Loan and any unreimbursed expenditures for real
property taxes or for property restoration or preservation relating to the
Mortgaged Property that secured such Loan.
LIQUIDATION PRINCIPAL: The principal portion of Liquidation Proceeds
received with respect to each Loan which became a Liquidated Loan (but not in
excess of the Principal Balance thereof) during the applicable Prepayment
Period, exclusive of the Group I Discount Fraction of Liquidation
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Proceeds received with respect to each Group I Discount Loan, if any, and
exclusive of the Group II Discount Fraction of Liquidation Proceeds received
with respect to each Group II Discount Loan, if any.
LIQUIDATION PROCEEDS: Amounts after deduction of amounts reimbursable
under Section 3.7 received and retained in connection with the liquidation of
Defaulted Loans (including the disposition of REO Property), whether through
foreclosure or otherwise, other than Insurance Proceeds.
LOAN GROUP: Loan Group I and Loan Group II, as applicable.
LOAN GROUP I: The group of Loans comprised of Group I Loans.
LOAN GROUP II: The group of Loans comprised of Group II Loans.
LOANS: The Mortgages and the related Mortgage Notes, each transferred
and assigned to the Trustee pursuant to the provisions hereof as from time to
time are held as part of the Trust Fund, as so identified in the Loan Schedule.
Each of the Loans is referred to individually in this Agreement as a "Loan".
LOAN SCHEDULE: The schedule, as amended from time to time, of Loans
attached hereto as Exhibit D, which shall set forth as to each Loan the
following, among other things:
(i) the loan number of the Loan and name of the related Mortgagor;
(ii) the city, state and zip code of the Mortgaged Property;
(iii) the Mortgage Interest Rate as of the Cut-Off Date;
(iv) the original term and maturity date of the related Mortgage
Note;
(v) the original Principal Balance;
(vi) the first payment date;
(vii) the Monthly Payment in effect as of the Cut-Off Date;
(viii) the date of the last paid installment of interest;
(ix) the unpaid Principal Balance as of the close of business on
the Cut-Off Date;
(x) the Loan-to-Value ratio at origination;
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(xi) the type of property and the Original Value of the
Mortgaged Property;
(xii) whether a primary mortgage insurance policy is in effect as of
the Cut-Off Date;
(xiii) the nature of occupancy at origination;
(xiv) the servicing fee; (which, in the case of the Group I Loans, may
be disclosed in two parts identified as the servicing fee and master servicing
fee or the "Lender Fee" and "Management Fee");
(xv) the county in which Mortgaged Property is located, if
available;
(xvi) the Loan Group; and
(xvii) the closing date.
LOAN-TO-VALUE RATIO: The original principal amount of a Loan divided by
the Original Value; however, references to "current Loan-to-Value Ratio" shall
mean the then current Principal Balance of a Loan divided by the Original Value.
LOCKOUT PERCENTAGE: For any Distribution Date, will equal (i) the sum
of (x) the Class IA-4 Principal Balance and (y) the Class IA-26 Principal
Balance; divided by (ii) the aggregate Scheduled Principal Balance of all Group
I Loans immediately preceding such Distribution Date (exclusive of the Group I
Discount Fraction of the Group I Discount Loans).
LOCKOUT PRINCIPAL AMOUNT: For any Distribution Date will equal the sum
of (i) the product of (a) 0% for any Distribution Date prior to the Distribution
Date in June 2008, and thereafter, the Lockout Percentage and (b) the Principal
Payment Amount for the Group I Loans (exclusive of the portion thereof
attributable to the Group I Discount Fractional Principal Amount); and (ii) the
product of: (a) the Lockout Percentage; (b) the Step Down Percentage; and (c)
the sum of the following amounts with respect to the Group I Loans: (1) the
Principal Prepayment Amount (exclusive of the portion thereof attributable to
the Group I Discount Fractional Principal Amount); and (2) the Liquidation
Principal.
MONTHLY PAYMENT: The scheduled payment of principal and interest on a
Loan which is due on the related Due Date for such Loan after giving effect to
any reduction in the amount of interest collectible from any Mortgagor pursuant
to the Relief Act.
MOODY'S: Xxxxx'x Investors Service, Inc. provided that at any time it
is a Rating Agency.
MORTGAGE: The mortgage, deed of trust or other instrument securing a
Mortgage Note.
MORTGAGE FILE: As defined in Section 2.1.
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MORTGAGE INTEREST RATE: For any Loan, the per annum rate at which
interest accrues on such Loan pursuant to the terms of the related Mortgage Note
without regard to any reduction thereof as a result of the Relief Act.
MORTGAGE NOTE: The note or other evidence of indebtedness evidencing
the indebtedness of a Mortgagor under a Loan.
MORTGAGE POOL: All of the Loans.
MORTGAGED PROPERTY: With respect to any Loan, the real property,
together with improvements thereto, securing the indebtedness of the Mortgagor
under the related Loan.
MORTGAGOR: The obligor on a Mortgage Note.
NONRECOVERABLE ADVANCE: With respect to any Loan, any Advance which a
Servicer shall have determined to be a Nonrecoverable Advance pursuant to
Section 4.4 and which was, or is proposed to be, made by such Servicer.
NON-U.S. PERSON: A Person that is not a U.S. Person.
OFFICER'S CERTIFICATE: With respect to any Person, a certificate signed
by the Chairman of the Board, the President or a Vice-President of such Person
(or, in the case of a Person which is not a corporation, signed by the person or
persons having like responsibilities), and delivered to the Trustee.
OPINION OF COUNSEL: A written opinion of counsel, who may be outside or
salaried counsel for the Depositor or a Servicer, or any Affiliate of the
Depositor or a Servicer, acceptable to the Trustee; provided, that with respect
to REMIC matters, matters relating to the determination of Eligible Accounts or
matters relating to transfers of Certificates, such counsel shall be
Independent.
ORIGINAL VALUE: With respect to any Loan other than a Loan originated
for the purpose of refinancing an existing mortgage debt, the lesser of (a) the
Appraised Value (if any) of the Mortgaged Property at the time the Loan was
originated or (b) the purchase price paid for the Mortgaged Property by the
Mortgagor. With respect to a Loan originated for the purpose of refinancing
existing mortgage debt, the Original Value shall be equal to the Appraised Value
of the Mortgaged Property at the time the Loan was originated or the appraised
value at the time the refinanced mortgage debt was incurred.
OTS: The Office of Thrift Supervision, or any successor thereto.
OWNERSHIP INTEREST: As defined in Section 5.1(b)
PASS-THROUGH ENTITY: As defined in Section 5.1(b)
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PASS-THROUGH RATE: For each Loan and for any date of determination, a
per annum rate equal to the Mortgage Interest Rate for such Loan less the
applicable per annum percentage rate of the Servicing Fee. For each Loan, any
calculation of monthly interest at such rate shall be based upon annual interest
at such rate (computed on the basis of a 360-day year of twelve 30-day months)
on the unpaid Principal Balance of the related Loan divided by twelve, and any
calculation of interest at such rate by reason of a Payoff shall be based upon
annual interest at such rate on the outstanding Principal Balance of the related
Loan multiplied by a fraction, the numerator of which is the number of days
elapsed from the Due Date of the last scheduled payment of principal and
interest to, but not including, the date of such Payoff, and the denominator of
which is (a) for Payoffs received on a Due Date, 360, and (b) for all other
Payoffs, 365.
PAYING AGENT: As defined in Section 4.10.
PAYOFF: Any Mortgagor payment of principal on a Loan equal to the
entire outstanding Principal Balance of such Loan, if received in advance of the
last scheduled Due Date for such Loan and accompanied by an amount of interest
equal to accrued unpaid interest on the Loan to the date of such
payment-in-full.
PAYOFF EARNINGS: For any Distribution Date with respect to any Loan for
which a Payoff was received during the applicable Prepayment Period, the
aggregate of the interest earned by the related Servicer from investment of each
such Payoff from the date of receipt of such Payoff until the last day of such
Prepayment Period (net of investment losses).
PAYOFF INTEREST: For any Distribution Date with respect to a Group I
Loan for which a Payoff was received on or after the first calendar day of the
month of such Distribution Date and before the 15th calendar day of such month,
an amount of interest thereon at the applicable Pass-Through Rate from the first
day of the month of distribution through the day of receipt thereof; to the
extent (together with Payoff Earnings and the portion of the related Servicing
Fee described in clause (A)(i)(a) of the definition of Compensating Interest)
not required to be distributed as Compensating Interest on such Distribution
Date, Payoff Interest shall be payable to the related Servicer as additional
servicing compensation. For any Distribution Date with respect to each Group II
Loan on which a Payoff was received by the related Servicer during the
Prepayment Period, an amount of interest thereon at the applicable Pass-Through
Rate from the first day of such Prepayment Period to the date of receipt
thereof.
PERCENTAGE INTEREST: (a) With respect to the right of each Certificate
of a particular Class in the distributions allocated to such Class, "Percentage
Interest" shall mean the percentage undivided beneficial ownership interest
evidenced by such Certificate of such Class, which percentage shall equal:
(i) with respect to any Regular Interest Certificate (other
than the Interest Only Certificates), its Certificate Principal Balance
divided by the applicable Class Principal Balance;
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(ii) with respect to the Interest Only Certificates, the
portion of the respective Class Notional Amount evidenced by such
Certificate divided by the respective Class Notional Balance; and
(iii) with respect to the Class R Certificate, the percentage
set forth on the face of such Certificate.
(b) With respect to the rights of each Certificate in connection with
Sections 5.9, 7.1, 7.3, 8.3 and 10.1, "Percentage Interest" shall mean the
percentage undivided beneficial interest evidenced by such Certificate in the
Trust Fund, which for purposes of such rights only shall equal:
(i) with respect to any Certificate (other than the Interest
Only Certificates), the product of (x) 96.00% and (y) the percentage
calculated by dividing its Certificate Principal Balance by the
Aggregate Certificate Principal Balance; provided, however, that the
product in (x) above shall be increased by one percent (1%) upon each
retirement of an Interest Only Certificate;
(ii) with respect to each Interest Only Certificate, one
percent (1%) of such Certificate Percentage Interest as calculated by
paragraph (a)(ii) of this definition; and
(iii) with respect to the Class R Certificate, zero.
PERMITTED TRANSFEREE: With respect to the holding or ownership of any
Residual Certificate, any Person other than (i) the United States, a State or
any political subdivision thereof, or any agency or instrumentality of any of
the foregoing, (ii) a foreign government or International Organization, or any
agency or instrumentality of either of the foregoing, (iii) an organization
(except certain farmers' cooperatives described in Code Section 521) which is
exempt from the taxes imposed by Chapter 1 of the Code (unless such organization
is subject to the tax imposed by Section 511 of the Code on unrelated business
taxable income), (iv) rural electric and telephone cooperatives described in
Code Section 1381(a)(2)(C), (v) any electing large partnership under Section 775
of the Code, (vi) any Person from whom the Trustee or the Certificate Registrar
has not received an affidavit to the effect that it is not a "disqualified
organization" within the meaning of Section 860E(e)(5) of the Code, and (vii)
any other Person so designated by the Depositor based upon an Opinion of Counsel
that the transfer of an Ownership Interest in a Residual Certificate to such
Person may cause the Trust Fund to fail to qualify as a REMIC at any time that
the Certificates are outstanding. The terms "United States," "State" and
"International Organization" shall have the meanings set forth in Code Section
7701 or successor provisions. A corporation shall not be treated as an
instrumentality of the United States or of any State or political subdivision
thereof if all of its activities are subject to tax, and, with the exception of
the FHLMC, a majority of its board of directors is not selected by such
governmental unit.
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PERSON: Any individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
PLAN: As defined in Section 5.1(d).
PREPAID MONTHLY PAYMENT: Any Monthly Payment received prior to its
scheduled Due Date, which is intended to be applied to a Loan on its scheduled
Due Date and held in the related Custodial Account for P&I until the Withdrawal
Date following its scheduled Due Date.
PREPAYMENT INTEREST SHORTFALL: For any Distribution Date, an amount
equal to the sum of all interest shortfalls resulting from (i) Payoffs during
the related Prepayment Period, to the extent not covered by Compensating
Interest; and (ii) Curtailments during the related Prepayment Period.
PREPAYMENT PERIOD: (a)(i) With respect to the first Distribution Date
and any Payoffs in respect of a Group I Loan, the period from the Cut-Off Date
through May 14, 2003, inclusive; and for any Distribution Date thereafter, the
period from the 15th day of the applicable calendar month preceding such
Distribution Date through the 14th day of the month of such Distribution Date,
inclusive and (ii) with respect to Curtailments in respect of a Group I Loan,
the calendar month immediately preceding any Distribution Date, and (b) with
respect to any Group II Loan and any Distribution Date, the calendar month
immediately preceding any Distribution Date.
PRINCIPAL BALANCE: At the time of any determination, the principal
balance of a Loan remaining to be paid at the close of business on the Cut-Off
Date, after deduction of all principal payments due on or before the Cut-Off
Date whether or not paid, reduced by all amounts distributed or to be
distributed to Certificateholders through the Distribution Date in the month of
determination that are reported as allocable to principal of such Loan.
In the case of a Substitute Loan, "Principal Balance" shall mean, at
the time of any determination, the principal balance of such Substitute Loan
transferred to the Trust Fund on the date of substitution, reduced by all
amounts distributed or to be distributed to Certificateholders through the
Distribution Date in the month of determination that are reported as allocable
to principal of such Substitute Loan.
The Principal Balance of a Loan (including a Substitute Loan) shall not
be adjusted solely by reason of any bankruptcy or similar proceeding or any
moratorium or similar waiver or grace period. Whenever a Realized Loss has been
incurred with respect to a Loan during a calendar month, the Principal Balance
of such Loan shall be reduced by the amount of such Realized Loss as of the
Distribution Date next following the end of such calendar month after giving
effect to the allocation of Realized Losses and distributions of principal to
the Certificates.
PRINCIPAL ONLY CERTIFICATES: The Class IA-P Certificates and Class
IIA-P Certificates.
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PRINCIPAL PAYMENT: Any payment of principal on a Loan other than a
Principal Prepayment.
PRINCIPAL PAYMENT AMOUNT: On any Distribution Date, the sum, determined
separately for each Loan Group, of (i) the scheduled principal payments on the
related Loans due on the related Due Date, (ii) the principal portion of
repurchase proceeds received with respect to any related Loan which was
repurchased by the Depositor pursuant to a Purchase Obligation or as permitted
by this Agreement during the applicable Prepayment Period, and (iii) any other
unscheduled payments of principal which were received with respect to any
related Loan during the applicable Prepayment Period, other than Payoffs,
Curtailments and Liquidation Principal.
PRINCIPAL PREPAYMENT: Any payment of principal on a Loan which
constitutes a Payoff or a Curtailment.
PRINCIPAL PREPAYMENT AMOUNT: On any Distribution Date, the sum,
determined separately for each Loan Group, of (i) Curtailments received during
the applicable Prepayment Period from such related Loans and (ii) Payoffs
received during the applicable Prepayment Period from the related Loans.
PRO RATA ALLOCATION: The allocation of the principal portion of certain
losses relating to a Loan in a Loan Group to the Senior Certificates related to
that Loan Group (other than the Principal Only Certificates and Interest Only
Certificates) and/or to the Subordinate Certificates, as applicable, pro rata
according to their respective Certificate Principal Balances or, in the case of
the Accrual Certificates, the Certificate Principal Balance of those Accrual
Certificates on the Closing Date, if lower, (except (1) if the loss is
recognized with respect to a Group I Discount Loan or a Group II Discount Loan,
in which event the applicable Group I Discount Fraction or Group II Discount
Fraction of such loss will be allocated to the Class IA-P Certificates or Class
IIA-P Certificates, respectively, and the remainder of such loss will be
allocated as described above in this definition without regard to this
parenthetical, (2) all Realized Losses allocable to the Class IA-1 Certificates
will be allocated in accordance with the definitions of Class IA-1 Priority
Amount I and Class IA-1 Priority Amount II, and (3) all Realized Losses, except
Excess Losses, allocable to the Class IA-4 Certificates and Class IA-27
Certificates will be allocated to the Class IA-26 Certificates (i) with respect
to the Class IA-4 Certificates, up to an amount equal to 95.70% of the Class
Principal Balance of the Class IA-26 Certificates for such Distribution Date and
(ii) with respect to the Class IA-27 Certificates, up to an amount equal to
4.30% of the Class Principal Balance of the Class IA-26 Certificates for such
Distribution Date, in each case until the Class Principal Balance of the Class
IA-26 Certificates has been reduced to zero) in reduction thereof, and the
allocation of the interest portion of such losses to such Certificates pro rata
according to the amount of interest accrued but unpaid on each such Class in
reduction thereof and then pro rata according to their outstanding Certificate
Principal Balances or, in the case of the Accrual Certificates, the Certificate
Principal Balance of those Accrual Certificates on the Closing Date, if lower,
in reduction thereof. For purposes of Pro Rata Allocation in part to the
Subordinate Certificates, each Class of Subordinate Certificates will be deemed
to have a Class Principal Balance equal to the following:
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Class Principal Balance x Group I Subordinate Amount (for a loss on a Group I Loan) or
of that certificate Group II Subordinate Amount (for a loss on a Group II Loan)
-----------------------------------------------------------
Group I Subordinate Amount + Group II Subordinate Amount
PURCHASE OBLIGATION: An obligation of the Depositor to repurchase Loans
under the circumstances and in the manner provided in Section 2.2 or Section
2.3.
PURCHASE PRICE: With respect to any Loan to be purchased pursuant to a
Purchase Obligation, or any Loan to be purchased or repurchased relating to an
REO Property, an amount equal to the sum of the Principal Balance thereof, plus
accrued and unpaid interest thereon, if any, to the last day of the calendar
month in which the date of repurchase occurs at a rate equal to the applicable
Mortgage Interest Rate; provided, however, that no Loan shall be purchased or
required to be purchased pursuant to Section 2.3, or more than two years after
the Closing Date under Section 2.2, unless (a) the Loan to be purchased is in
default, or default is in the judgment of the Depositor reasonably imminent, or
(b) the Depositor, at its expense, delivers to the Trustee an Opinion of Counsel
to the effect that the purchase of such Loan will not give rise to a tax on a
prohibited transaction, as defined in Section 860F(a) of the Code; provided,
further, that in the case of clause (b) above, the Depositor will use its
reasonable efforts to obtain such Opinion of Counsel if such opinion is
obtainable.
RATING AGENCY: Initially, each of Fitch and Xxxxx'x; thereafter, each
nationally recognized statistical rating organization that has rated the
Certificates at the request of the Depositor, or their respective successors in
interest.
RATINGS: As of any date of determination, the ratings, if any, of the
Certificates as assigned by each Rating Agency.
REALIZED LOSS: For any Distribution Date, with respect to any Loan
which became a Liquidated Loan during the related applicable Prepayment Period,
the sum of (i) the principal balance of such Loan remaining outstanding and the
principal portion of Nonrecoverable Advances actually reimbursed with respect to
such Loan (the principal portion of such Realized Loss), and (ii) the accrued
interest on such Loan remaining unpaid and the interest portion of
Nonrecoverable Advances actually reimbursed with respect to such Loan (the
interest portion of such Realized Loss). For any Distribution Date, with respect
to any Loan which is not a Liquidated Loan, the amount of the Bankruptcy Loss
incurred with respect to such Loan as of the related Due Date will be treated as
a Realized Loss.
RECORD DATE: With respect to each Distribution Date and each Class of
Certificates (other than the Class IIA-5 Certificates and Class IIA-6
Certificates that are Book-Entry Certificates), the close of business on the
last Business Day of the month immediately preceding the month of the related
Distribution Date. With respect to each Distribution Date and the Class IIA-5
Certificates and Class IIA-6 Certificates so long as such Certificates are
Book-Entry Certificates, the Business Day immediately preceding such
Distribution Date.
REGULAR INTEREST CERTIFICATES: The Certificates, other than the Class R
Certificate.
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RELIEF ACT: The Soldiers' and Sailors' Civil Relief Act of 1940, as
amended.
RELIEF ACT INTEREST SHORTFALL: With respect to any Distribution Date
and Loan, any reduction in the amount of interest collectible on such Loan for
the most recently ended calendar month immediately preceding such Distribution
Date as a result of the application of the Relief Act or similar state law.
REMIC: A real estate mortgage investment conduit, as such term is
defined in the Code.
REMIC I: The pool of assets (other than any Escrow Account or Accounts)
consisting of the portion of Trust Fund representing the Group I Loans.
REMIC I REGULAR INTERESTS: The regular interests in REMIC I as
described in Section 2.4 of this Agreement.
REMIC I SUBORDINATED BALANCE RATIO: The ratio between the principal
balances of each of the REMIC I Regular Interests ending with the designation
"A," equal to the ratio of: (1) the Group I Subordinate Amount, to the (2) Group
II Subordinate Amount.
REMIC II: The pool of assets (other than any Escrow Account or
Accounts) consisting of the portion of the Trust Fund representing the Group II
Loans.
REMIC II REGULAR INTERESTS: The regular interests in REMIC II as
described in Section 2.4 of this Agreement.
REMIC III: The pool of assets consisting of the REMIC I Regular
Interests and the REMIC II Regular Interests and all payments of principal or
interest on or with respect to the REMIC I Regular Interests and the REMIC II
Regular Interests after the Cut-Off Date.
REMIC III REGULAR INTERESTS: The Certificates, other than the Class R
Certificate.
REMIC PROVISIONS: Sections 860A through 860G of the Code, related Code
provisions and regulations promulgated thereunder, as the foregoing may be in
effect from time to time.
REMITTANCE RATE: For each Class of interest bearing Certificates, the
per annum rate set forth as the Remittance Rate for such Class in the
Preliminary Statement hereto.
REO PROPERTY: A Mortgaged Property, title to which has been acquired by
the related Servicer on behalf of the Trust Fund through foreclosure, deed in
lieu of foreclosure or otherwise.
RESIDUAL CERTIFICATE: The Class R Certificate, which is being issued in
a single class. Components R-1, R-2 and R-3 of the Class R Certificate are
hereby each designated the sole Class
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of "residual interests" in REMIC I, REMIC II and REMIC III, respectively, for
purposes of Section 860G(a)(2) of the Code.
RESIDUAL DISTRIBUTION AMOUNT: On any Distribution Date, any portion of
the Group I and Group II Available Distribution remaining after all
distributions to the Certificates pursuant to the definition of Certificate
Distribution Amount (including the Class R Certificate only to the extent of any
distributions to the Class R Certificate pursuant to clauses (I)(B)(iii) and
(I)(D)(iii) of such definition). Upon termination of the obligations created by
this Agreement and the Trust Fund created hereby, the amounts which remain on
deposit in the Certificate Account after payment to the Certificateholders of
the amounts set forth in Section 9.1 of this Agreement, and subject to the
conditions set forth therein.
RESPONSIBLE OFFICER: When used with respect to the Trustee or any
Seller, the Chairman or Vice-Chairman of the Board of Directors or Trustees, the
Chairman or Vice-Chairman of the Executive or Standing Committee of the Board of
Directors or Trustees, the President, the Chairman of the Committee on Trust
Matters, any Vice-President, any Assistant Vice-President, the Secretary, any
Assistant Secretary, the Treasurer, any Assistant Treasurer, the Cashier, any
Assistant Cashier, any Trust Officer or Assistant Trust Officer, the Controller,
any Assistant Controller or any other officer of the Trustee 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, and also, with respect to a particular matter, any other officer
to whom such matter is referred because of such officer's knowledge of and
familiarity with the particular subject. When used with respect to any Servicer,
the Chairman or Vice-Chairman of the Board of Directors or Trustees, the
Chairman or Vice-Chairman of the Executive or Standing Committee of the Board of
Directors or Trustees, the President, any Vice-President, the Secretary, any
Assistant Secretary, the Treasurer, any Assistant Treasurer, the Controller and
any Assistant Controller or any other officer of any Servicer customarily
performing functions similar to those performed by any of the above-designated
officers and also, with respect to a particular matter, any other officer to
whom such matter is referred because of such officer's knowledge of and
familiarity with the particular subject. When used with respect to the Depositor
or any other Person, the Chairman or Vice-Chairman of the Board of Directors,
the Chairman or Vice-Chairman of any executive committee of the Board of
Directors, the President, any Vice-President, the Secretary, any Assistant
Secretary, the Treasurer, any Assistant Treasurer, or any other officer of the
Depositor customarily performing functions similar to those performed by any of
the above-designated officers and also, with respect to a particular matter, any
other officer to whom such matter is referred because of such officer's
knowledge of and familiarity with the particular subject.
RETAIL CERTIFICATES: The Class IA-3, Class IA-4, Class IA-5, Class
IA-6, Class IA-7, Class IA-8, Class IA-9, Class IA-10, Class IA-11, Class IA-12,
Class IA-13, Class IA-14, Class IA-15, Class IA-16, Class IA-17, Class IA-18,
Class IA-19, Class IA-20, Class IA-21, Class IA-22, Class IA-23, Class IA-24,
Class A-27, Class A-28, Class IA-30 and Class IIA-4 Certificates.
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S&P: Standard & Poor's, a division of The XxXxxx-Xxxx Companies, Inc.,
provided, that at any time it is a Rating Agency.
SCHEDULED PRINCIPAL BALANCE: With respect to any Loan as of any
Distribution Date, the unpaid principal balance of such Loan as specified in the
amortization schedule at the time relating thereto (before any adjustment to
such schedule by reason of bankruptcy or similar proceeding or any moratorium or
similar waiver or grace period) as of the first day of the month preceding the
month of such Distribution Date, after giving effect to any previously applied
Curtailments, the payment of principal due on such first day of the month and
any reduction of the principal balance of such Loan by a bankruptcy court,
irrespective of any delinquency in payment by the related Mortgagor.
SECURITIES ACT: The Securities Act of 1933, as amended.
SELLER: ABN AMRO Mortgage Group, Inc. or Washington Mutual Mortgage
Securities Corp., as applicable.
SENIOR CERTIFICATES: The Class A Certificates and the Class R
Certificate, collectively.
SENIOR SUBORDINATE CERTIFICATES: The Class M, Class B-1 and Class B-2
Certificates, collectively.
SERVICER: With respect to: (1) the Group I Loans, Washington Mutual
Mortgage Securities Corp., a Delaware corporation, or (2) the Group II Loans,
ABN AMRO Mortgage Group, Inc., a Delaware corporation, or any successors thereto
appointed as provided pursuant to Section 7.5, acting to service and administer
such Loans pursuant to Section 3.1.
SERVICER'S SECTION 3.10 REPORT: A report delivered by the related
Servicer to the Trustee or the Certificate Administrator pursuant to Section
3.10.
SERVICING FEE: For each Group I Loan in the Loan Schedule, the fee paid
to the related Servicer to perform primary servicing functions with respect to
such Loan as specified on the Loan Schedule. For each Group II Loan, the fee
paid to the related Servicer to perform primary servicing functions with respect
to such Loan, equal to the per annum rate of 0.2500% for each Loan in the Loan
Schedule on the outstanding Principal Balance of such Loan.
SERVICING OFFICER: Any individual involved in, or responsible for, the
administration and servicing of the Loans whose name and specimen signature
appear on a list of servicing officers furnished to the Trustee on the Closing
Date by the related Servicer in the form of an Officer's Certificate, as such
list may from time to time be amended.
SPECIAL HAZARD COVERAGE: As of the Cut-Off Date, approximately
$3,494,667 and thereafter on each Anniversary, the Special Hazard Coverage shall
be reduced, but not increased, to an amount
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equal to the lesser of (1) the greatest of (a) the aggregate Principal Balance
of the Loans located in the single California zip code area containing the
largest aggregate Principal Balance of the Loans, (b) 1% of the aggregate unpaid
Principal Balance of the Loans and (c) twice the unpaid Principal Balance of the
largest single Loan in each case calculated as of the Due Date in the
immediately preceding month, and (2) the initial Special Hazard Coverage as of
the Cut-Off Date as reduced by the Special Hazard Losses allocated to the
Certificates since the Cut-Off Date. Special Hazard Coverage may be reduced upon
written confirmation from each Rating Agency that such reduction will not
adversely affect the then current ratings assigned to the Certificates by each
Rating Agency.
SPECIAL HAZARD LOSS: The occurrence of any direct physical loss or
damage to a Mortgaged Property not covered by a standard hazard maintenance
policy with extended coverage which is caused by or results from any cause
except: (i) fire, lightning, windstorm, hail, explosion, riot, riot attending a
strike, civil commotion, vandalism, aircraft, vehicles, smoke, sprinkler
leakage, except to the extent of that portion of the loss which was uninsured
because of the application of a co-insurance clause of any insurance policy
covering these perils; (ii) normal wear and tear, gradual deterioration,
inherent vice or inadequate maintenance of all or part thereof; (iii) errors in
design, faulty workmanship or materials, unless the collapse of the property or
a part thereof ensues and then only for the ensuing loss; (iv) nuclear reaction
or nuclear radiation or radioactive contamination, all whether controlled or
uncontrolled and whether such loss be direct or indirect, proximate or remote or
be in whole or in part caused by, contributed to or aggravated by a peril
covered by this definition of Special Hazard Loss; (v) hostile or warlike action
in time of peace or war, including action in hindering, combating or defending
against an actual, impending or expected attack (a) by any government or
sovereign power (dejure or defacto), or by an authority maintaining or using
military, naval or air forces, (b) by military, naval or air forces, or (c) by
an agent of any such government, power, authority or forces; (vi) any weapon of
war employing atomic fission or radioactive force whether in time of peace or
war; (vii) insurrection, rebellion, revolution, civil war, usurped power or
action taken by governmental authority in hindering, combating or defending
against such occurrence; or (viii) seizure or destruction under quarantine or
customs regulations, or confiscation by order of any government or public
authority.
STEP DOWN PERCENTAGE: For any Distribution Date will be the percentage
indicated below:
DISTRIBUTION DATE OCCURRING IN STEP DOWN PERCENTAGE
------------------------------ --------------------
June 2003 through May 2008.................. 0%
June 2008 through May 2009.................. 30%
June 2009 through May 2010.................. 40%
June 2010 through May 2011.................. 60%
June 2011 through May 2012.................. 80%
June 2012 and thereafter.................... 100%
SUBORDINATE AMOUNT: means the Group I Subordinate Amount or the Group
II Subordinate Amount, as the context requires.
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SUBORDINATE CERTIFICATES: The Class M, Class B-1, Class B-2, Class B-3,
Class B-4 and Class B-5 Certificates, collectively, and designated as such on
the face thereof in substantially the form attached hereto as Exhibits A-1 and
A-2 and for purposes of this Agreement, the "order of seniority" from highest to
lowest of such certificates shall be the order designated in the beginning of
this definition.
SUBORDINATE INTEREST RATE: For any Distribution Date will equal the
interest rate as determined by the following formula:
5.50% multiplied by the Group I Subordinate Amount
+
4.729954229% multiplied by the Group II Subordinate Amount
----------------------------------------------------------
Group I Subordinate Amount + Group II Subordinate Amount
SUBORDINATE LIQUIDATION AMOUNT: For each Loan Group, the excess, if
any, of the aggregate of Liquidation Principal for all Loans which became
Liquidated Loans during the Prepayment Period, over the related Senior
Liquidation Amount for such Distribution Date.
SUBORDINATE PERCENTAGE: As of the Closing Date, as determined
separately for each Loan Group, approximately 2.26% for Loan Group I and 2.26%
for Loan Group II, and thereafter, with respect to any Distribution Date, the
excess of 100% over the applicable Senior Percentage for such date.
SUBORDINATE PREPAYMENT PERCENTAGE: As of the Closing Date, determined
separately for each Loan Group, 0% for both Loan Group I and Loan Group II, and
thereafter, with respect to any Distribution Date, the excess of 100% over the
applicable Senior Prepayment Percentage.
SUBORDINATE PRINCIPAL AMOUNT: For each Loan Group on any Distribution
Date, will be equal to the sum of:
(1) the applicable Subordinate Percentage of the related Principal
Payment Amount (exclusive of the portion thereof attributable
to the sum of the Group I Discount Fractional Principal
Amounts for Group I Loans or the Group II Discount Fractional
Principal Amounts for Group II Loans, as applicable for such
Distribution Date);
(2) the applicable Subordinate Principal Prepayment Amount; and
(3) the applicable Subordinate Liquidation Amount;
PROVIDED, HOWEVER, that the Subordinate Principal Amount applicable to
Group I Loans shall be reduced by the amounts required to be
distributed to the Class IA-P Certificates with respect to Group I
Discount Fractional Principal Shortfall on such Distribution Date and
the Subordinate Principal Amount applicable to Group II Loans shall be
reduced by the amounts required to be distributed to the Class IIA-P
Certificates with respect to the Group II Discount Fractional Principal
Shortfall on such Distribution Date; PROVIDED, FURTHER, that the
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Subordinate Principal Amount for any Distribution Date for either Loan
Group shall be reduced to the extent of any amounts required to be
distributed to the Senior Certificates relating to the other Loan Group
pursuant to the provisions described in the definition of "Certificate
Distribution Amount" herein.
Any reduction in the applicable Subordinate Principal Amount pursuant to the
proviso above shall offset the amount calculated pursuant to clause (1), clause
(3) and clause (2), in such order of priority. On any Distribution Date, the
applicable Subordinate Principal Amount shall be allocated pro rata, by Class
Principal Balance, among the Classes of Subordinate Certificates and paid in the
order of distribution to such Classes pursuant to clauses (I)(B)(i)(b) and
(I)(D)(i)(b) of the definition of "Certificate Distribution Amount" herein,
except as otherwise stated in such definition. Notwithstanding the foregoing, on
any Distribution Date prior to distributions on such date, if the applicable
Subordination Level for any Class of Subordinate Certificates is less than such
percentage as of the Closing Date, the pro rata portion of the applicable
Subordinate Principal Prepayment Amount otherwise allocable to the Class or
Classes junior to such Class will be distributed to the most senior Class of the
Subordinate Certificates for which the Subordination Level is less than such
percentage as of the Closing Date, and to the Classes of Subordinate
Certificates senior thereto, pro rata according to the Class Principal Balances
of such Classes.
SUBORDINATE PRINCIPAL PREPAYMENT AMOUNT: For each Loan Group on any
Distribution Date, the applicable Subordinate Prepayment Percentage of the
related Principal Prepayment Amount (exclusive, with respect to the Group I
Loans, of the portion thereof attributable to the sum of the Group I Discount
Fractional Principal Amounts and with respect to the Group II Loans, of the
portion thereof attributable to the sum of the Group II Discount Fractional
Principal Amounts as applicable for such Distribution Date).
SUBORDINATION LEVEL: On any specified date, with respect to any Class
of Subordinate Certificates, the percentage obtained by dividing: (1) the sum of
the Class Principal Balances of all Classes of Certificates which are
subordinate in right of payment to such Class as of such date before giving
effect to distributions or allocations of Realized Losses on the Loans on such
date; by (2) the sum of the Class Principal Balances of all Classes of
Certificates as of such date before giving effect to distributions or
allocations of Realized Losses on the Loans on such date.
SUBSTITUTE LOAN: As defined in Section 2.2.
TARGETED PRINCIPAL BALANCE: For any Distribution Date, the amount set
forth in the table attached hereto as Exhibit N for such Distribution Date, for
the Class IA-1 Certificates.
TAX MATTERS PERSON: The Holder of the Class R Certificate issued
hereunder or any Permitted Transferee of such Class R Certificateholder shall be
the initial "tax matters person" for REMIC I, REMIC II and REMIC III within the
meaning of Section 6231(a)(7) of the Code. For tax years commencing after any
transfer of the Class R Certificate, the holder of the greatest Percentage
Interest in the Class R Certificate at year end shall be designated as the Tax
Matters Person with
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respect to that year. If the Tax Matters Person becomes a Disqualified
Organization, the last preceding Holder of such Authorized Denomination of the
Class R Certificate that is not a Disqualified Organization shall be Tax Matters
Person pursuant to Section 5.1(c). If any Person is appointed as tax matters
person by the Internal Revenue Service pursuant to the Code, such Person shall
be Tax Matters Person.
TRANSFER: As defined in Section 5.1(b).
TRANSFEREE: As defined in Section 5.1(b).
TRANSFEREE AFFIDAVIT AND AGREEMENT: As defined in Section 5.1(c)(i)(B).
TRUST FUND: The corpus of the trust created pursuant to Section 2.1 of
this Agreement. The Trust Fund consists of (i) the Loans and all rights
pertaining thereto; (ii) such assets as from time to time may be held by the
Trustee (except amounts representing the applicable Servicing Fee and amounts on
deposit in Escrow Accounts); including the Certificate Account and all amounts
deposited therein pursuant to the applicable provisions of this Agreement; (iii)
such assets as from time to time may be held by the Servicers in a Custodial
Account for P&I related to the Loans (except amounts representing the applicable
Servicing Fee); (iv) property which secured a Loan and which has been acquired
by foreclosure or deed in lieu of foreclosure after the Cut-Off Date; (v)
amounts paid or payable by the insurer under any FHA insurance policy and
proceeds of any VA guaranty and any other insurance policy related to any Loan
or the Mortgage Pool; and (vi) the rights and remedies of the Depositor
contained in Section 8 of the Mortgage Loan Purchase Agreements, each dated as
of the Closing Date, between the applicable Seller and the Depositor.
TRUSTEE: JPMorgan Chase Bank, a New York state banking corporation, or
its successor-in-interest as provided in Section 8.9, or any successor trustee
appointed as herein provided.
UNCERTIFICATED REMIC I PASS-THROUGH RATE: With respect to REMIC I
Regular Interests LTI- I-A1, LTI-I-A3, LTI-I-A4, LTI-I-A5, LTI-I-A6, LTI-I-A7,
XXX-X-X0, XXX-X-X0, XXX-X-X00, XXX-X- X00, XXX-X-X00, LTI-I-A13, LTI-I-A14,
LTI-I-A15, LTI-I-A16, LTI-I-A17, LTI-I-A18, LTI-I-A19, LTI-I-A20, LTI-I-A21,
LTI-I-A22, LTI-I-A23, LTI-I-A24, LTI-I-A25, XXX-X-X00, XXX-X-X00, XXX-X- X00,
XXX-X-X00, LTI-I-A30 and LTI-I-SUB, a per annum rate of 5.50%. LTI-I-IO will not
have an Uncertificated Pass-Through Rate, but will accrue interest at a per
annum rate equal to the excess of the Pass-Through Rate on each Group I Premium
Loan less 5.50%.
UNCERTIFICATED REMIC II PASS-THROUGH RATE: With respect to REMIC II
Regular Interests LTII-II-A1, LTII-II-A3, LTII-II-A4 and LTII-II-A8, a per annum
rate of 4.75%. With respect to REMIC II Regular Interests LTII-II-A2, a per
annum rate of 4.50%. With respect to REMIC II Regular Interests LTII-II-A5, a
per annum rate of 8.00%. With respect to REMIC II Regular Interests LTII-II-A7,
a per annum rate of rate of 2.70%. With respect to REMIC II Regular Interest
LTII-II-Sub, a per annum rate of 4.729954229%. REMIC II Regular Interest
LTII-II-IO will not have
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an Uncertificated Pass-Through Rate, but will accrue interest at a per annum
rate equal to the excess of the Pass-Through Rate on each Group II Premium Loan
less 4.729954229%.
UNCOLLECTED INTEREST: With respect to any Distribution Date for any
Loan on which a Payoff was made by a Mortgagor during the related Prepayment
Period, except for Payoffs with respect to a Group I Loan received during the
period from the first through the 14th day of the month of such Distribution
Date, an amount equal to one month's interest at the applicable Pass-Through
Rate on such Loan less the amount of interest actually paid by the Mortgagor
with respect to such Payoff.
UNCOMPENSATED INTEREST SHORTFALL: With respect to a Loan Group or any
Distribution Date, the excess, if any, of (i) the sum of (a) aggregate
Uncollected Interest with respect to the Loans in the related Loan Group and (b)
aggregate Curtailment Shortfall with respect to the Loans in the related Loan
Group and (c) any shortfall in interest collections in the calendar month
immediately preceding such Distribution Date resulting from a Relief Act
Interest Shortfall with respect to the Loans in the related Loan Group over (ii)
Compensating Interest, which excess shall be allocated to each Class of
Certificates pro rata according to the amount of interest accrued thereon in
reduction thereof.
UNDERWRITERS: Credit Suisse First Boston LLC and ABN AMRO Financial
Services, Inc.
U.S. PERSON: A citizen or resident of the United States, a corporation
or partnership (including an entity treated as a corporation or partnership for
federal income tax purposes) created or organized in, or under the laws of, the
United States or any state thereof or the District of Columbia (except, in the
case of a partnership, to the extent provided in regulations) or an estate whose
income is subject to United States federal income tax regardless of its source,
or a trust if a court within the United States is able to exercise primary
supervision over the administration of the trust and one or more such U.S.
Persons have the authority to control all substantial decisions of the trust. To
the extent prescribed in regulations by the Secretary of the Treasury, which
have not yet been issued, a trust which was in existence on August 20, 1996
(other than a trust treated as owned by the grantor under subpart E of part 1 of
subchapter J of chapter 1 of the Code), and which was treated as a U.S. Person
on August 20, 1996 may elect to continue to be treated as a U.S. Person
notwithstanding the previous sentence.
VA: The Department of Veterans Affairs, formerly known as the Veterans
Administration, or any successor thereto.
WITHDRAWAL DATE: The Business Day immediately preceding the related
Distribution Date.
All references to the origination date or original date in the Loan
Schedule with respect to a Loan shall refer to the date upon which the related
Mortgage Note was originated or modified, whichever is later.
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ARTICLE II
CONVEYANCE OF TRUST FUND;
ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.1 CONVEYANCE OF TRUST FUND.
The Depositor, concurrently with the execution and delivery hereof,
does hereby irrevocably sell, convey and assign to the Trustee and REMIC I
without recourse all the right, title and interest of the Depositor in and to
the portion of the Trust Fund representing the Group I Loans, to REMIC II
without recourse all the right, title and interest of the Depositor in and to
the portion of the Trust Fund representing the Group II Loans and to REMIC III
without recourse all the right, title and interest of the Depositor in and to
the REMIC I Regular Interests and the REMIC II Regular Interests, for the
benefit respectively of REMIC III and the Certificateholders, including all
interest and principal received by the Depositor with respect to the Loans after
the Cut-Off Date (and including without limitation scheduled payments of
principal and interest due after the Cut-Off Date but received by the Depositor
on or before the Cut-Off Date, but not including payments of principal and
interest due on the Loans on or before the Cut-Off Date). The Depositor, at its
own expense, shall file or cause to be filed protective Form UCC-1 financing
statements with respect to the Loans in the State of Illinois or other
applicable jurisdiction, listing itself as "Debtor" under such financing
statement and listing the Trustee, for the benefit of the Certificateholders, as
"Secured Party" under such financing statement.
In connection with such assignment, the Depositor does hereby deliver
to, and deposit with, the Trustee for the benefit of the Certificateholders the
following documents or instruments with respect to each Loan so assigned:
(i) The original Mortgage Note (or, if the original Mortgage
Note has been lost or destroyed, a lost note affidavit and indemnity)
bearing all intervening endorsements endorsed, "Pay to the order of
JPMorgan Chase Bank, as Trustee, for the benefit of the
Certificateholders of ABN AMRO Mortgage Corporation Series 2003-6 Attn:
Institutional Services, 000 Xxxxxx Xxxxxx, 00xx Xxxxx, Xxxxxxx, Xxxxx
00000, without recourse" and signed in the name of the Seller by an
Authorized Officer showing an unbroken chain of title from the
originator thereof to the person endorsing;
(ii) (a) The original Mortgage with evidence of recording
thereon, and if the Mortgage was executed pursuant to a power of
attorney, a certified true copy of the power of attorney certified by
the recorder's office, with evidence of recording thereon, or certified
by a title insurance company or escrow company to be a true copy
thereof; provided, that if such original Mortgage or power of attorney
cannot be delivered with evidence of recording thereon on or prior to
the Closing Date because of a delay caused by the public recording
office where such original Mortgage has been delivered for recordation
or because such original Mortgage has been lost, the Depositor shall
deliver or cause to be delivered to the Trustee a true and correct copy
of such Mortgage, together with (1) in the case of a delay
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caused by the public recording office, an Officer's Certificate signed
by a Responsible Officer of the Seller stating that such original
Mortgage has been dispatched to the appropriate public recording
official for recordation or (2) in the case of an original Mortgage
that has been lost, a certificate by the appropriate county recording
office where such Mortgage is recorded or from a title insurance
company or escrow company indicating that such original was lost and
the copy of the original mortgage is a true and correct copy;
(b) The original Assignment to "JPMorgan Chase Bank, as
Trustee for the benefit of the Certificateholders," which assignment
shall be in form and substance acceptable for recording, or a copy
certified by the Seller or the originator of the related Loan as a true
and correct copy of the original Assignment which has been sent for
recordation. Subject to the foregoing, such assignments may, if
permitted by law, be by blanket assignments for Loans covering
Mortgaged Properties situated within the same county. If the Assignment
is in blanket form, a copy of the Assignment shall be included in the
related individual Mortgage File.
(iii) The originals of any and all instruments that modify the
terms and conditions of the Mortgage Note, including but not limited to
modification, consolidation, extension and assumption agreements
including any adjustable rate mortgage (ARM) rider, if any,
(iv) The originals of all required intervening assignments, if
any, with evidence of recording thereon, and if such assignment was
executed pursuant to a power of attorney, a certified true copy of the
power of attorney certified by the recorder's office, with evidence of
recording thereon, or certified by a title insurance company or escrow
company to be a true copy thereof; provided, that if such original
assignment or power of attorney cannot be delivered with evidence of
recording thereon on or prior to the Closing Date because of a delay
caused by the public recording office where such original assignment
has been delivered for recordation or because such original Assignment
has been lost, the Depositor shall deliver or cause to be delivered to
the Trustee a true and correct copy of such Assignment, together with
(a) in the case of a delay caused by the public recording office, an
Officer's Certificate signed by a Responsible Officer of the Seller
stating that such original assignment has been dispatched to the
appropriate public recording official for recordation or (b) in the
case of an original assignment that has been lost, a certificate by the
appropriate county recording office where such assignment is recorded
or from a title insurance company or escrow company indicating that
such original was lost and the copy of the original assignment is a
true and correct copy; and
(v) The original mortgagee policy of title insurance
(including, if applicable, the endorsement relating to the negative
amortization of the Loans) or in the event such original title policy
is unavailable, any one of an original title binder, an original
preliminary title report or an original title commitment or a copy
thereof certified by the title company with the original policy of
title insurance to follow within 180 days of the Closing Date.
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The documents and instruments set forth in clauses (i) - (v) above shall be
called, collectively, the "Mortgage File".
If the Depositor cannot deliver the original Mortgage with evidence of
recording thereon concurrently with the execution and delivery of this Agreement
because of a delay caused by the public recording office where such original
Mortgage has been delivered for recordation, the Depositor shall deliver to the
Trustee an Officer's Certificate, with a photocopy of such Mortgage attached
thereto, stating that such original Mortgage has been delivered to the
appropriate public recording official for recordation. The Depositor shall
promptly deliver to the Trustee such original Mortgage with evidence of
recording indicated thereon upon receipt thereof from the public recording
official.
The Depositor shall, at its own expense, promptly record or cause to be
recorded in the appropriate public real property or other records each
Assignment referred to in Section 2.1(ii), unless the Depositor delivers to the
Trustee an Independent opinion of counsel to the effect that such recordation is
not necessary to protect the Trustee's and the Certificateholders' interest in
the related Mortgage Loans, in which case such Assignments shall be delivered to
the Trustee for the benefit of the Certificateholders in recordable form. If the
Depositor cannot deliver the original Assignment concurrently with the execution
and delivery of this Agreement solely because it is in the process of being
prepared and recorded or because of a delay caused by the public recording
office where such original Assignment has been delivered for recordation, the
Depositor shall deliver a blanket Officer's Certificate covering all such
Assignments stating that such original Assignment is in the process of being
prepared and recorded or it has been delivered to the appropriate public
recording official for recordation. Any such original recorded Assignment shall
be delivered to the Trustee within 180 days following the execution of this
Agreement.
If the Depositor cannot deliver the original title insurance policy
concurrently with the execution and delivery of this Agreement, the Depositor
shall promptly deliver each such original title insurance policy as soon as such
policy becomes available but in no event later than 120 days following the
execution of this Agreement.
All rights arising out of Loans including, without limitation, all
funds received on or in connection with a Loan shall be held by the Depositor in
trust for the benefit of the Certificateholders. The Depositor shall maintain a
complete set of books and records for each Loan which shall be clearly marked to
reflect the ownership of each Loan by the Certificateholders.
It is the express intent of this Agreement that the conveyance of the
Loans by the Depositor to the Trustee as provided in this Section 2.1 be, and be
construed as, a sale of the Loans by the Depositor to the Trustee and that the
sale of the Certificates to the Certificateholders, if they are sold, be, and be
construed as, a sale of a 100% interest in the Loans and the Trust Fund to such
Certificateholders. It is, further, not the intention of this Agreement that
such conveyance be deemed a pledge of the Loans by the Depositor to the Trustee
to secure a debt or other obligation of the Depositor. However, in the event
that, notwithstanding the intent of this Agreement, the Loans are
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held to be property of the Depositor, or if for any other reason this Agreement
is held or deemed to create a security interest in the Loans, then (a) this
Agreement shall also be deemed to be a security agreement within the meaning of
Articles 8 and 9 of the New York Uniform Commercial Code; (b) the conveyance
provided for in this Section 2.1 shall be deemed to be a grant by the Depositor
to the Trustee for the benefit of the Certificateholders of a security interest
in all of the Depositor's right, title and interest in and to the Loans and all
amounts payable to the holders of the Loans in accordance with the terms thereof
and all proceeds of the conversion, voluntary or involuntary, of the foregoing
into cash, instruments, securities or other property, including without
limitation all amounts, other than investment earnings, from time to time held
or invested in the Certificate Account, whether in the form of cash,
instruments, securities or other property; (c) the possession by the Trustee or
any Custodian of Mortgage Notes and such other items of property as constitute
instruments, money, negotiable documents or chattel paper shall be deemed to be
"in possession by the secured party" for purposes of perfecting the security
interest pursuant to Section 9-313 of the New York Uniform Commercial Code; and
(d) notifications to persons holding such property, and acknowledgments,
receipts or confirmations from persons holding such property, shall be deemed
notifications to, or acknowledgments, receipts or confirmations from, financial
intermediaries, bailees or agents (as applicable) of the Trustee for the benefit
of the Certificateholders for the purpose of perfecting such security interest
under applicable law (except that nothing in this clause (d) shall cause any
person to be deemed to be an agent of the Trustee for any purpose other than for
perfection of such security interest unless, and then only to the extent,
expressly appointed and authorized by the Trustee in writing). The Depositor and
the Trustee, upon directions from the Depositor, shall, to the extent consistent
with this Agreement, take such actions as may be necessary to ensure that, if
this Agreement were deemed to create a perfected security interest in Loans,
such security interest would be deemed to be a perfected security interest of
first priority under applicable law and will be maintained as such throughout
the term of this Agreement.
The Trustee is authorized to appoint LaSalle Bank National Association,
Standard Federal Bank, N.A. or any bank or trust company approved by the
Depositor as Custodian of the documents or instruments referred to under (i)
through (v) above, and to enter into a Custodial Agreement for such purpose and
any documents delivered thereunder shall be delivered to the Custodian and any
Officer's Certificates delivered with respect thereto shall be delivered to the
Trustee and the Custodian.
Section 2.2 ACCEPTANCE BY TRUSTEE.
(a) The Trustee acknowledges, subject to the provisions of Section 2.1
and to any document exceptions reported pursuant to the Trustee's reviews as
described below, receipt of the Mortgage Notes (or lost note affidavits and
indemnities), the Mortgages, the assignments of the Mortgages and the Officer's
Certificates referred to in Section 2.1 above, and declares that it holds and
will hold such documents and the other documents constituting a part of the
Mortgage Files delivered to it as Trustee in trust, upon the trusts herein set
forth, for the use and benefit of all present and future Certificateholders. The
Trustee acknowledges that, as of the date of the execution of this Agreement,
the Mortgage Files have been delivered to the Trustee and the Trustee has
conducted a
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preliminary review of the Mortgage Files. The Trustee further acknowledges that
such review included a review of the Mortgage Notes (or lost note affidavits and
indemnities) to determine that the appropriate Mortgage Notes (or lost note
affidavits and indemnities) have been delivered and endorsed in the manner set
forth in Section 2.1(i). In connection with such review, the Trustee shall have
delivered an exceptions report indicating any discrepancies relating to such
review.
(b) No later than 90 days after the Closing Date, the Trustee agrees,
for the benefit of the Certificateholders, to review each Mortgage File
delivered to it and to execute and deliver, or cause to be executed and
delivered, to the Depositor and the Trustee an Interim Certification
substantially in the form attached hereto as Exhibit C-1. In conducting such
review, the Trustee agrees to ascertain that all required documents set forth in
items (i), (ii) and (v) and, to the extent delivered to the Trustee, items (iii)
and (iv) of Section 2.1 have been executed and received, and that such documents
relate to the Loans identified in Exhibit D annexed hereto, and in so doing the
Trustee may rely on the purported due execution and genuineness of any such
document and on the purported genuineness of any signature thereon. The Trustee
shall have no duty to verify or determine whether any Mortgage File should
contain documents described in Sections 2.1(iii) and (iv). Neither the Trustee
nor the Custodian shall be responsible for determining whether any assignment or
mortgage delivered pursuant to Section 2.1(ii) is in recordable form or, if
recorded, has been properly recorded. The Trustee shall be under no duty or
obligation to inspect, review or make any independent examination of any
documents contained in each Mortgage File beyond the review specifically
required herein. The Trustee makes no representations as to (i) the validity,
legality, sufficiency, enforceability or genuineness of any of the documents
contained in each Mortgage File or any of the Loans identified on the Loan
Schedule, or (ii) the collectability, insurability, effectiveness or suitability
of any such Loan. If at the conclusion of such 90-day period the Trustee finds
any document constituting part of the Mortgage File not to have been executed or
received, or to be unrelated to the Loans identified in Exhibit D (each such
finding, a "material defect"), the Trustee shall promptly notify the Depositor,
which shall have a period of 90 days after the REMIC has received such notice to
correct or cure any such material defect; provided, however, that if the Trustee
shall not have received a document by reason of the fact that such document
shall not have been returned by the appropriate recording office then the
Depositor shall have until a date one year later from the Cut-Off Date to
correct or cure such defect. The Depositor hereby covenants and agrees that, if
any such material defect as defined above is not corrected or cured, the
Depositor will, within 90 days of the REMIC having received notice, either (i)
repurchase the related Loan at a price equal to 100% of the Principal Balance of
such Loan (or any property acquired in respect thereof) plus accrued interest on
such Principal Balance at the applicable Mortgage Interest Rate to the next
scheduled Due Date of such Loan or (ii) substitute for any Loan to which such
material defect relates a different mortgage loan (a "Substitute Loan") maturing
no later than and not more than two years earlier than the Loan being
substituted for; and having a principal balance equal to or less than the Loan
being substituted for and a Mortgage Interest Rate equal to or greater than the
Mortgage Interest Rate of the Loan being substituted for, a Loan-to-Value Ratio
equal to or less than the Loan-to-Value Ratio of the Loan being substituted for
and otherwise having such characteristics so that the representations and
warranties of the Depositor set forth in Section 2.3 hereof would not have been
incorrect had such Substitute Loan originally been a Loan; provided, however,
that if the
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Principal Balance of the original Loan exceeds the principal balance of the
Substitute Loan, an amount equal to that difference shall be deposited by the
Depositor in the Certificate Account; provided, further, that if the defect
would cause the Loan to be other than a "qualified mortgage" as defined in
Section 860(G)(a)(3) of the Code such cure, repurchase or substitution must
occur within 90 days from the date such material defect was discovered, unless
the Trustee shall have received from the Depositor an Opinion of Counsel to the
effect that such cure, repurchase or substitution will not adversely affect the
REMIC status of REMIC I, REMIC II or REMIC III or constitute a prohibited
transaction or substitution under the REMIC provisions of the Code, and, if
applicable, within the meaning of the REMIC Provisions of the particular State,
if any, which would impose a tax on the Trust Fund.
(c) In addition, the Trustee agrees, for the benefit of
Certificateholders, to review each Mortgage File delivered to it within 180 days
after the Closing Date, or with respect to assignments which must be recorded,
within 180 days, after execution of this Agreement and to execute and deliver,
or cause to be executed and delivered, to the Depositor and the Trustee a Final
Certification substantially in the form attached hereto as Exhibit C-2. In
conducting such review, the Trustee agrees that if at the conclusion of such
180-day period the Trustee finds a material defect, the Trustee shall promptly
notify the Depositor, which shall have a period of 90 days after the REMIC has
received such notice to correct or cure any such material defect. The Depositor
hereby covenants and agrees that, if any such material defect as defined above
is not corrected or cured, the Depositor will, within 90 days of the REMIC
having received such notice, either repurchase the related Loan or substitute
for any Loan to which such material defect relates in accordance with this
Agreement.
Monthly Payments due with respect to Substitute Loans in the month of
substitution are not a part of the Trust Fund and will be retained by the
related Servicer. The Depositor shall notify each Rating Agency of any such
substitution. For the month of substitution, distributions to Certificateholders
will include the Monthly Payment due on the Loan being substituted for in such
month. The purchase price for the repurchased Loan or property shall be
deposited by the Depositor in the Certificate Account and in the case of a
Substitute Loan, the Mortgage File relating thereto shall be delivered to the
Trustee or the Custodian. Upon receipt by the Trustee of written notification of
such deposit signed by a Servicing Officer or the new Mortgage File, as the case
may be, and an Officer's Certificate that such repurchase or substitution is in
accordance with this Agreement, the Trustee shall release or cause to be
released to the Depositor the related Mortgage File for the Loan being
repurchased or substituted for, as the case may be, and shall execute and
deliver or cause to be executed and delivered such instrument of transfer or
assignment presented to it by the Depositor, in each case without recourse, as
shall be necessary to transfer to the Depositor the Trustee's interest in such
original or repurchased Loan or property and the Trustee shall have no further
responsibility with regard to such Loan. It is understood and agreed that the
obligation of the Depositor to substitute a new Loan for or repurchase any Loan
or property as to which such a material defect in a constituent document exists
shall constitute the sole remedy respecting such defect available to
Certificateholders or the Trustee on behalf of Certificateholders, but such
obligation shall survive termination of this Agreement.
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Section 2.3 REPRESENTATIONS AND WARRANTIES OF THE DEPOSITOR WITH
RESPECT TO THE LOANS. The Depositor hereby represents and warrants to the
Trustee as of the Closing Date with respect to the Loans:
(i) that the information set forth in the Loan Schedule
appearing as an exhibit to this Agreement is true and correct in all
material respects at the date or dates respecting which such
information is furnished as specified therein;
(ii) that as of the date of the transfer of the Loans to the
Trustee, the Depositor is the sole owner and holder of each Loan free
and clear of all liens, pledges, charges or security interests of any
nature and has full right and authority, subject to no interest or
participation of, or agreement with, any other party, to sell and
assign the same;
(iii) that as of the date of initial issuance of the
Certificates, no payment of principal of or interest on or in respect
of any Loan is 30 days or more past due from the Due Date of such Loan;
(iv) that to the best of the Depositor's knowledge, as of the
date of the transfer of the Loans to the Trustee, there is no valid
offset, defense or counterclaim to any Mortgage Note or Mortgage;
(v) that as of the date of the initial issuance of the
Certificates, there is no proceeding pending, or to the best of the
Depositor's knowledge, threatened for the total or partial condemnation
of any of the Mortgaged Property and, to the best of the Depositor's
knowledge the Mortgaged Property is free of material damage and is in
good repair and neither the Mortgaged Property nor any improvement
located on or being part of the Mortgaged Property is in violation of
any applicable zoning law or regulation;
(vi) that each Loan complies in all material respects with
applicable state or federal laws, regulations and other requirements,
pertaining to usury, equal credit opportunity and disclosure laws, and
each Loan was not usurious at the time of origination;
(vii) that to the best of the Depositor's knowledge, as of the
date of the initial issuance of the Certificates, all insurance
premiums previously due and owing with respect to the Mortgaged
Property have been paid and all taxes and governmental assessments
previously due and owing, and which may become a lien against the
Mortgaged Property, with respect to the Mortgaged Property have been
paid;
(viii) that each Mortgage Note and the related Mortgage 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
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equity or at law); 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 have been duly and properly executed by
the Mortgagor;
(ix) that each Mortgage is a valid and enforceable first lien
on the property securing the related Mortgage Note, and that each Loan
is covered by an ALTA mortgagee title insurance policy or other form of
policy or insurance generally acceptable to FNMA or FHLMC, issued by,
and is a valid and binding obligation of, a title insurer acceptable to
FNMA or FHLMC insuring the originator, its successor and assigns, as to
the lien of the Mortgage in the original principal amount of the Loan
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 Loan and
(c) 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;
(x) that as of the initial issuance of the Certificates,
neither the Depositor nor any prior holder of any Mortgage has, except
as the Mortgage File may reflect, modified the Mortgage in any material
respect; satisfied, canceled or subordinated such Mortgage in whole or
part; released such Mortgaged Property in whole or in part from the
lien of the Mortgage; or executed any instrument of release,
cancellation, modification or satisfaction;
(xi) that each Mortgaged Property consists of a fee simple
estate or a condominium form of ownership in real property;
(xii) no foreclosure action is threatened or has been
commenced (except for the filing of any notice of default) with respect
to the Loan; and except for payment delinquencies not in excess of 30
days, 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;
and the Depositor has not waived any default, breach, violation or
event of acceleration;
(xiii) that each Loan was originated on FNMA or FHLMC uniform
instruments for the state in which the Mortgaged Property is located;
(xiv) that based upon a representation by each Mortgagor at
the time of origination or assumption of the applicable Loan, 95.63% of
the Group I Loans and 95.52% of the Group II Loans, measured by
Principal Balance, were to be secured by primary residences and no
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more than 4.37% of the Group I Loans and 4.48% of the Group II Loans,
measured by Principal Balance, were to be secured by second homes;
(xv) that an appraisal of each Mortgaged Property was
conducted at the time of origination of the related Loan, and that each
such appraisal was conducted in accordance with FNMA or FHLMC criteria,
on FNMA or FHLMC forms and comparables on at least three properties
were obtained;
(xvi) that no Loan had a Loan-to-Value Ratio at origination
in excess of 95%;
(xvii) the Loans were not selected in manner to adversely
affect the interests of the Certificateholders and the Depositor knows
of no conditions which reasonably would cause it to expect any Loan to
become delinquent or otherwise lose value;
(xviii) each Loan was either (A) originated directly by or
closed in the name of either: (i) a savings and loan association,
savings bank, commercial bank, credit union, insurance company, or
similar institution which is supervised and examined by a federal or
state authority or (ii) a mortgagee approved by the Secretary of
Housing and Urban Development pursuant to Sections 203 and 211 of the
National Housing Act or (B) originated or underwritten by an entity
employing underwriting standards consistent with the underwriting
standards of an institution as described in subclause (A)(i) or (A)(ii)
above;
(xix) each Loan is a "qualified mortgage" within the meaning
of Section 860G of the Code without regard to ss. 1.860G-2(f) of the
REMIC Provisions or any similar rule;
(xx) each Loan that has a Loan-to-Value Ratio in excess of
80% is covered by a primary mortgage insurance policy;
(xxi) that no Loan permits negative amortization or the
deferral of accrued interest, and
(xxii) No Loan is a "high-cost home loan" as defined in the
Georgia Fair Lending Act, as amended, or in the New York Predatory
Lending Law, codified as N.Y. Banking Law ss. 6-l, N.Y. Gen. Bus.
Lawss.771-a, and N.Y. Real Prop. Acts Lawss.1302.
It is understood and agreed that the representations and warranties set
forth in this Section 2.3 shall survive delivery of the respective Mortgage
Files to the Trustee, or to a Custodian, as the case may be. Upon discovery by
the Depositor, any Servicer, the Trustee or any Custodian of a breach of any of
the foregoing representations and warranties (referred to herein as a "breach"),
without regard to any limitation set forth in such representation or warranty
concerning the knowledge of the Depositor as to the facts stated therein, which
breach materially and adversely affects the interests of the Certificateholders
in the related Loan, the party discovering such breach shall give prompt written
notice to the others and to each Rating Agency.
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Within 90 days of its discovery or its receipt or any Seller's receipt
of notice of breach, the Depositor shall or shall cause such Seller to cure such
breach in all material respects or shall repurchase the Loan or any property
acquired in respect thereof from the Trustee at a repurchase price equal to 100%
of the Principal Balance of such Loan plus accrued interest on such Principal
Balance at the Mortgage Interest Rate to the next scheduled Due Date of such
Loan or remove such Loan from the Trust Fund and substitute in its place a
Substitute Loan or Loans with the characteristics set forth in Section 2.2 above
for Substitute Loans; provided, however, that if such breach would cause the
Loan to be other than a "qualified mortgage" as defined in Section 860G(a)(3) of
the Code, any such cure, repurchase or substitution must occur within 90 days
from the date such breach was discovered; provided, further, that no
substitution (or cure which would constitute a loan modification for federal
income tax purposes) may be effected any later than two years after the Closing
Date; provided, further, that as a pre-condition to any substitution (or cure
which would constitute a loan modification for federal income tax purposes) to
be effected later than 90 days after the Closing Date (and within two years of
the Closing Date), the Trustee shall receive from the Depositor an Opinion of
Counsel to the effect that such substitution (or cure which would constitute a
loan modification for federal income tax purposes) will not adversely affect the
REMIC status of REMIC I, REMIC II or REMIC III or constitute a prohibited
transaction under the REMIC Provisions of the Code and, if applicable, the REMIC
provisions of the relevant State. Except as expressly set forth herein, neither
the Trustee nor the Servicers are under any obligation to discover any breach of
the above mentioned representations and warranties. It is understood and agreed
that the obligation of the Depositor or the related Seller to repurchase or
substitute any Loan or property as to which a breach has occurred and is
continuing shall constitute the sole remedy respecting such breach available to
Certificateholders or the Trustee on behalf of Certificateholders, and such
obligation shall survive as the obligation of the Depositor, the related Seller
or their respective successors.
Section 2.4 AUTHENTICATION AND DELIVERY OF CERTIFICATES; DESIGNATION OF
CERTIFICATES AS REMIC REGULAR AND RESIDUAL INTERESTS.
(a) The Trustee acknowledges the transfer to the extent provided herein
and assignment to it of the Trust Fund and, concurrently with such transfer and
assignment, has caused to be authenticated and delivered to or upon the order of
the Depositor, in exchange for the Trust Fund, Certificates evidencing the
entire ownership of the Trust Fund.
(b) This Agreement shall be construed so as to carry out the intention
of the parties that each of REMIC I, REMIC II and REMIC III be treated as a
REMIC at all times prior to the date on which the Trust Fund is terminated. The
"regular interests" (within the meaning of Section 860G(a)(1) of the Code) in
REMIC III shall consist of the Class A Certificates and the Subordinate
Certificates. The "residual interest" (within the meaning of Section 860G(a)(2)
of the Code) in REMIC III shall consist of Component R-3 of the Class R
Certificate, which component shall have $100 principal balance. The following
table irrevocably sets forth the designation, the Uncertificated REMIC I
Pass-Through Rate and the initial Uncertificated Principal Balances for each
REMIC I Regular Interest, each of which is hereby designated as a "regular
interest" (within the meaning of
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Section 860G(a)(1) of the Code) in REMIC I. Solely for purposes of satisfying
Treasury regulation Section 1.860G-1(a)(4)(iii) the "latest possible maturity
date" for each of the REMIC I Regular Interests shall be the first Distribution
Date that is at least two years after the end of the remaining amortization
schedule of the Loan in the Mortgage Pool that has, as of the Closing Date, the
longest remaining amortization schedule, irrespective of its scheduled maturity.
None of the REMIC I Regular Interests will be certificated.
Uncertificated
Initial Uncertificated REMIC II Pass- Assumed Final
Designation Principal Balance Through Rate Maturity Date
----------- ---------------------- --------------- --------------
LTI-I-A1 $96,588,000 5.50% May 25, 2033
LTI-I-A3 $31,103,000 5.50% May 25, 2033
LTI-I-A4 $43,650,000 5.50% May 25, 2033
LTI-I-A5 $47,462,000 5.50% May 25, 2033
LTI-I-A6 $ 5,066,000 5.50% May 25, 2033
LTI-I-A7 $16,927,000 5.50% May 25, 2033
LTI-I-A8 $29,299,000 5.50% May 25, 2033
LTI-I-A9 $10,000,000 5.50% May 25, 2033
LTI-I-A10 $ 8,215,000 5.50% May 25, 2033
LTI-I-A11 $ 5,000,000 5.50% May 25, 2033
LTI-I-A12 $ 8,000,000 5.50% May 25, 2033
LTI-I-A13 $ 2,062,500 5.50% May 25, 2033
LTI-I-A14 $ 808,594 5.50% May 25, 2033
LTI-I-A15 $ 128,906 5.50% May 25, 2033
LTI-I-A16 $ 1,756,944 5.50% May 25, 2033
LTI-I-A17 $ 867,064 5.50% May 25, 2033
LTI-I-A18 $ 250,992 5.50% May 25, 2033
LTI-I-A19 $19,857,399 5.50% May 25, 2033
LTI-I-A20 $ 5,129,631 5.50% May 25, 2033
LTI-I-A21 $ 203,703 5.50% May 25, 2033
LTI-I-A22 $ 2,000,000 5.50% May 25, 2033
LTI-I-A23 $ 1,071,636 5.50% May 25, 2033
LTI-I-A24 $ 88,631 5.50% May 25, 2033
LTI-I-A25 $52,231,000 5.50% May 25, 2033
LTI-I-A26 $ 5,081,174 5.50% May 25, 2033
LTI-I-A27 $23,129,000 5.50% May 25, 2033
LTI-I-A28 $10,281,000 5.50% May 25, 2033
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LTI-I-A29 $15,649,000 5.50% May 25, 2033
LTI-I-A30 $45,399,000 5.50% May 25, 2033
LTI-I-IO (1) (2) May 25, 2033
LTI-I-PO $ 2,097,788 (3) May 25, 2033
LTI-I-SUB $11,265,054 5.50% May 25, 2033
___________________
(1) REMIC I Regular Interest LTI-I-IO will not have an Uncertificated
Principal Balance and is not entitled to receive distributions of
principal. Instead, interest will accrue on an Uncertificated Notional
Balance equal to the aggregate Stated Principal Balance of the Premium
Mortgage Loans in Loan Group I.
(2) REMIC I Regular Interests LTI-I-IO will accrue interest at a per annum
rate equal to the excess of the Pass-Through Rate on each Group
I Premium Loan less 5.50%.
(3) REMIC I Regular Interests LTI-I-PO is a principal only interest and
will not be entitled to distributions of interest.
(c) Distributions on REMIC I Regular Interests LTI-I-IO shall be made
from the Group I Premium Loans so that such REMIC I Regular Interest receives
interest in excess of 5.50% of such Loans. REMIC I Regular Interest LTI-I-PO
shall receive a portion of the principal received on the Group I Discount Loans
equal to the Group I Discount Fraction multiplied by the principal balance of
each such Loan. With respect to each remaining REMIC I Regular Interest, on each
Distribution Date the Trustee shall be deemed to distribute in respect of each
such REMIC I Regular Interest: (i) Uncertificated Accrued Interest for such
REMIC I Regular Interest for such Distribution Date, plus any Uncertificated
Accrued Interest thereon remaining unpaid from any previous Distribution Date,
and (ii) principal in an amount equal to that distributed in respect of the
Corresponding Class. Realized Losses allocated to the Group I Certificates shall
be allocated to each REMIC I Regular Interest in amounts equal to the amounts
allocated to the Corresponding Class.
(d) The following table irrevocably sets forth the designation, the
Uncertificated REMIC II Pass-Through Rate and the initial Uncertificated
Principal Balance for each REMIC II Regular Interest, each of which is hereby
designated as a "regular interest" (within the meaning of Section 860G(a)(1) of
the Code) in REMIC II. Solely for purposes of satisfying Treasury regulation
Section 1.860G-1(a)(4)(iii) the "latest possible maturity date" for each of the
REMIC II Regular Interests shall be the first Distribution Date that is at least
two years after the end of the remaining amortization schedule of the Loan in
the Mortgage Pool that has, as of the Closing Date, the longest remaining
amortization schedule, irrespective of its scheduled maturity. None of the REMIC
II Regular Interests will be certificated.
Uncertificated
Initial Uncertificated REMIC II Pass- Assumed Final
Designation Principal Balance Through Rate Maturity Date
----------- ---------------------- --------------- -------------
LTII-II-A1 $61,047,000 4.75% May 25, 2033
LTII-II-A2 $15,500,000 4.50% May 25, 2033
LTII-II-A3 $ 1,000,000 4.75% May 25, 2033
LTII-II-A4 $13,250,000 4.75% May 25, 2033
LTII-II-A5 $14,970,028 8.00% May 25, 2033
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LTII-II-A7 $23,732,972 2.70% May 25, 2033
LTII-II-A8 $63,807,504 4.75% May 25, 2033
LTII-II-IO (1) (2) May 25, 2033
LTII-II-PO $ 496,015 (3) May 25, 2033
LTII-II-SUB $ 4,460,953 4.729954229% May 25, 2033
LTII-R $ 100 4.729954229% May 25, 2033
____________________
(1) REMIC II Regular Interest LTII-II-IO will not have an Uncertificated
Principal Balance and is not entitled to distributions of principal.
Instead, interest will accrue on an Uncertificated Notional Balance
equal to the aggregate Stated Principal Balance of the Premium Mortgage
Loans in Loan Group II.
(2) REMIC II Regular Interests LTII-II-IO will accrue interest at a per
annum rate equal to the excess of the Pass-Through Rate on each Group
II Premium Loan less 4.729954229%.
(3) REMIC II Regular Interest LTII-II-PO is a principal only interest and
will not be entitled to distributions of interest.
(e) Distributions on REMIC II Regular Interests LTI-II-IO shall be made
from the Group II Premium Loans so that such REMIC II Regular Interest receives
interest in excess of 4.729954229% of such Loans. REMIC II Regular Interest
LTII-II-PO shall receive a portion of the principal received on the Group II
Discount Loans equal to the Group II Discount Fraction multiplied by the
principal balance of each such Loan. With respect to each remaining REMIC II
Regular Interest, on each Distribution Date the Trustee shall be deemed to
distribute in respect of each such REMIC II Regular Interest: (i) Uncertificated
Accrued Interest for such REMIC II Regular Interest for such Distribution Date,
plus any Uncertificated Accrued Interest thereon remaining unpaid from any
previous Distribution Date, and (ii) principal in an amount equal to that
distributed in respect of the Corresponding Class. Realized Losses allocated to
the Group II Certificates shall be allocated to each REMIC II Regular Interest
in amounts equal to the amounts allocated to the Corresponding Class.
Section 2.5 DESIGNATION OF STARTUP DAY. The Closing Date is hereby
designated as the "startup day" of each of REMIC I, REMIC II and REMIC III
within the meaning of Section 860G(a)(9) of the Code.
Section 2.6 NO CONTRIBUTIONS. The Trustee shall not accept or make any
contribution of cash to the Trust Fund after 90 days of the Closing Date, and
shall not accept or make any contribution of other assets to the Trust Fund
unless, in either case, it shall have received an Opinion of Counsel to the
effect that the inclusion of such assets in the Trust Fund will not cause any of
REMIC I, REMIC II or REMIC III to fail to qualify as a REMIC at any time that
any Class A or Subordinate Certificates are outstanding or subject the Trust
Fund to any tax on contributions to the REMIC under Section 860G(d) of the Code.
Section 2.7 REPRESENTATIONS AND WARRANTIES OF THE SERVICERS. Each
Servicer hereby represents, warrants and covenants to the Trustee for the
benefit of Certificateholders that, as of the date of execution of this
Agreement, solely as to itself:
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(a) such Servicer is a corporation duly formed and validly existing
under the laws of the State of Delaware;
(b) the execution and delivery of this Agreement by such Servicer and
its performance of and compliance with the terms of this Agreement will not
violate such Servicer's corporate charter or by-laws or constitute a default (or
an event which, with notice or lapse of time, or both, would constitute a
default) under, or result in the breach of, any material contract, agreement or
other instrument to which such Servicer is a party or which may be applicable to
such Servicer or any of its assets;
(c) this Agreement, assuming due authorization, execution and delivery
by the Trustee and the Depositor, constitutes a valid, legal and binding
obligation of such Servicer, enforceable against it in accordance with the terms
hereof subject to applicable bankruptcy, insolvency, reorganization, moratorium
and other laws affecting the enforcement of creditors' rights generally and to
general principles of equity, regardless of whether such enforcement is
considered in a proceeding in equity or at law;
(d) such Servicer is not in default with respect to any order or decree
of any court or any order, regulation or demand of any federal, state, municipal
or governmental agency, which default might have consequences that would
materially and adversely affect the condition (financial or other) or operations
of such Servicer or its properties or might have consequences that would affect
its performance hereunder; and
(e) no litigation is pending or, to the best of such Servicer's
knowledge, threatened against such Servicer which would prohibit its entering
into this Agreement or performing its obligations under this Agreement.
It is understood and agreed that the representations and warranties set
forth in this Section 2.7 shall survive delivery of the respective Mortgage
Files to the Trustee, or to a Custodian, as the case may be.
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ARTICLE III
ADMINISTRATION AND SERVICING OF LOANS
Section 3.1 SERVICERS TO ACT AS SERVICERS; ADMINISTRATION OF THE LOANS.
(a) Each Servicer shall service and administer the related Loans on
behalf of the Trust Fund solely in the best interests of and for the benefit of
the Certificateholders (as determined by each Servicer in its reasonable
judgment) and the Trustee (as trustee for Certificateholders) in accordance with
the terms of this Agreement and the respective Loans and, to the extent
consistent with such terms, in the same manner in which, and with the same care,
skill, prudence and diligence with which, it services and administers similar
mortgage loans for other portfolios, giving due consideration to customary and
usual standards of practice of prudent institutional residential mortgage
lenders and loan servicers, and taking into account its other obligations
hereunder, but without regard to:
(i) any relationship that a related Servicer, any
sub-servicer, any special servicer or any Affiliate of such Servicer,
any sub-servicer or any special servicer may have with the related
Mortgagor;
(ii) the ownership of any Certificate by a related Servicer,
any special servicer or any Affiliate of such Servicer, any
sub-servicer or any special servicer;
(iii) a Servicer's, any sub-servicer's or any special
servicer's right to receive compensation for its services hereunder or
with respect to any particular transaction; or
(iv) the ownership, or servicing or management for others, by
a related Servicer, any sub-servicer or any special servicer, of any
other mortgage loans or property.
In addition, each Servicer shall have full power and authority to do or
cause to be done any and all things in connection with such servicing and
administration which it may deem necessary or desirable, including, without
limitation, the power and authority to bring actions and defend the Trust Fund
on behalf of the Trustee in order to enforce the terms of the Mortgage Notes.
Each Servicer may perform its servicing responsibilities through agents or
independent contractors, but shall not thereby be released from any of its
responsibilities hereunder and each such Servicer shall diligently pursue all of
its rights against such agents or independent contractors.
To the extent consistent with the foregoing and subject to any express
limitations set forth in this Agreement, each Servicer shall seek to maximize
the timely and complete recovery of principal and interest on the Mortgage
Notes; provided, however, that nothing herein contained shall be construed as an
express or implied guarantee by the related Servicer of the collectability of
the Loans. Subject only to the above-described servicing standards and the terms
of this Agreement and of the respective Loans, each Servicer, as an independent
contractor, shall service and administer the
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Loans and shall have full power and authority, acting alone or through one or
more subservicers, special servicers or agents (subject to paragraph (c) of this
Section 3.1), to do any and all things in connection with such servicing and
administration which it may deem necessary or desirable for the purpose of
conserving the assets of the Trust Fund. Without limiting the generality of the
foregoing, each Servicer shall and is hereby authorized and empowered by the
Trustee to continue to execute and deliver, on behalf of itself, the
Certificateholders and the Trustee or any of them, any and all financing
statements, continuation statements and other documents or instruments necessary
to maintain the lien on each Mortgaged Property and related collateral; and
modifications, waivers, consents or amendments to or with respect to any
documents contained in the related Mortgage File; and any and all instruments of
satisfaction or cancellation, or of partial or full release or discharge;
assignments of Mortgages and endorsements of Mortgage Notes in connection with
refinancings (in jurisdictions where such assignments are customary and usual
standard of practice of mortgage lenders) and all other comparable instruments,
with respect to the Loans and with respect to the related Mortgaged Properties.
Notwithstanding the foregoing, a Servicer (whether acting alone or through one
or more subservicers, special servicers or agents) shall not modify, amend,
waive or otherwise consent to the change of the terms of any of the Loans
(including without limitation extending the stated maturity date of any Loan or
forgiving principal of or interest on any Loan), except as permitted by Section
3.2 hereof. Each Servicer shall service and administer the Loans in accordance
with applicable law and shall provide to the Mortgagors any reports required to
be provided to them thereby. To enable a Servicer to carry out its servicing and
administrative duties hereunder, upon a Servicer's written request accompanied
by the forms of any documents requested, the Trustee shall execute and deliver
to the related Servicer any powers of attorney and other documents necessary or
appropriate and the Trustee shall not be responsible for releasing such powers
of attorney. The Trustee shall not be responsible for, and the related Servicer
shall indemnify the Trustee for, any action taken by such Servicer pursuant to
the application of any such power of attorney. The relationship of each Servicer
(and of any successor thereto) to the Trustee under this Agreement is intended
by the parties to be that of an independent contractor and not that of a joint
venturer, partner or agent.
In connection with the servicing and administration of each Loan, each
Servicer and any affiliate of a Servicer (i) may with respect to defaulted
mortgage loans perform services such as appraisals, default management and
brokerage services that are not customarily provided by servicers of mortgage
loans, and shall be entitled to reasonable compensation therefore not in excess
of market rates for such services and (ii) may, at its own discretion and on
behalf of the Trustee, obtain credit information in the form of a "credit score"
from a credit repository.
(b) Each Servicer, Trustee and Depositor intend that REMIC I, REMIC II
and REMIC III formed hereunder shall constitute, and that each Servicer shall
perform its duties and obligation hereunder so as to qualify each of them as, a
"real estate mortgage investment conduit" as defined in and in accordance with
the REMIC Provisions. The Tax Matters Person, or the Person acting as
attorney-in-fact and agent therefor, shall: (a) prepare and file, or cause to be
prepared and filed, federal tax returns (as well as any other federal and state
information and other returns) using a calendar year as the taxable year when
and as required by the REMIC Provisions; (b) make (or cause
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to be made) an election, on behalf of each of REMIC I, REMIC II and REMIC III,
to be treated as a REMIC on the Federal tax return and any applicable state or
local returns for the first taxable year, in accordance with the REMIC
Provisions; (c) prepare and forward, or cause to be prepared and forwarded, to
the Certificateholders all information reports (including, without limitation,
the information required in connection with the computation of the present value
of anticipated excess inclusions as required by ss. 1.860E-2(a)(5) of the REMIC
Provisions) as and when required to be provided to them in accordance with the
REMIC Provisions; (d) conduct the affairs of the Trust Fund at all times that
REMIC I Regular Interests, REMIC II Regular Interests, or REMIC III Certificates
are outstanding so as to maintain the status of each of REMIC I, REMIC II and
REMIC III as a REMIC under the REMIC Provisions; and (e) not knowingly or
intentionally take any action or omit to take any action that would cause the
termination of the REMIC status of any of REMIC I, REMIC II or REMIC III.
(c) Each Servicer may enter into sub-servicing agreements with third
parties with respect to any of its respective rights and obligations hereunder,
provided, that any such agreement shall be consistent with the provisions of
this Agreement. Any such sub-servicing agreement may permit the sub-servicer to
delegate its rights and duties to agents or subcontractors so long as the
related agreements or arrangements with such agents or subcontractors are
consistent with the provisions of this Section 3.1(c). As long as the related
Servicer has any obligations to service the Loans hereunder (and it has not
assigned such obligations pursuant to Section 3.1(c)), the Loans shall be
serviced by a FNMA approved lender or a FHLMC seller/servicer in good standing.
Any sub-servicing agreement entered into by AAMG with a Person other
than the Depositor shall provide that it may be assumed or terminated by the
Trustee if the Trustee has assumed the duties of AAMG as Servicer, without cost
or obligation to the assuming or terminating party or the Trust Fund, upon the
assumption by such party of the obligations of such Servicer pursuant to Section
7.5. The Trustee shall not be obligated to assume any sub-servicing agreement
entered into by WMMSC and a third party.
Any sub-servicing agreement, and any other transactions or services
relating to the Loans involving a sub-servicer, including (if applicable) the
Depositor in its capacity as sub-servicer under a sub-servicing agreement and
not in its capacity as a party to this Agreement, shall be deemed to be between
the applicable Servicer and such sub-servicer (including the Depositor) alone,
and the Trustee and the Certificateholders shall not be deemed parties thereto
and shall have no claims, rights, obligations, duties or liabilities with
respect to the sub-servicer, except as set forth in Section 3.1(d).
In the event that the Trustee assumes the servicing obligations of a
Servicer (including by reason of an Event of Default which is not cured by the
related Servicer within the time permitted hereunder), upon request of the
Trustee, such Servicer shall at its own expense deliver to the Trustee all
documents and records relating to any sub-servicing agreement and the Loans then
being serviced thereunder and an accounting of amounts collected and held by it,
if any, and will otherwise use its best efforts to effect the orderly and
efficient transfer of any sub-servicing agreement to the Trustee.
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(d) Costs incurred by a Servicer in effectuating the timely payment of
taxes and assessments on the Mortgaged Property securing a Mortgage Note shall
be recoverable by the related Servicer pursuant to Section 3.3. Each Servicer
shall ensure all such taxes and assessments are timely paid.
Each Servicer, as an initial servicer, shall pay all of its costs and
proven damages incurred with respect to or arising out of any allegation of
impropriety in its servicing of the Loans. Further, such Servicer shall not be
entitled to reimbursement or indemnification from either the Trust Fund or the
Certificateholders with respect to any such costs, claims and damages.
(e) Notwithstanding any sub-servicing agreement, any of the provisions
of this Agreement relating to agreements or arrangements between a Servicer and
any Person (including the Depositor) acting as sub-servicer (or its agents or
subcontractors) or any reference to actions taken through any Person (including
the Depositor) acting as sub-servicer or otherwise, such Servicer shall remain
obligated and primarily liable to the Trustee and Certificateholders for the
servicing and administering of the Loans in accordance with the provisions of
this Agreement without diminution of such obligation or liability by virtue of
such sub-servicing agreements or arrangements or by virtue of indemnification
from the Depositor or any other Person acting as sub-servicer (or its agents or
subcontractors) to the same extent and under the same terms and conditions as if
such Servicer alone were servicing and administering the Loans. Each Servicer
shall be entitled to enter into an agreement with any sub-servicer providing for
indemnification of such Servicer by such sub-servicer (including the Depositor
and the Trustee), and nothing contained in this Agreement shall be deemed to
limit or modify such indemnification, but no such agreement for indemnification
shall be deemed to limit or modify this Agreement.
(f) Notwithstanding anything in this Agreement to the contrary, the
purchase of any of WMMSC-serviced Mortgage Loan by any Person shall be subject
to the rights of WMMSC to continue servicing such Mortgage Loan for the same
servicing fee substantially in accordance with the terms of this Agreement.
Section 3.2 COLLECTION OF CERTAIN LOAN PAYMENTS; CUSTODIAL ACCOUNT FOR
P&I.
(a) Each Servicer shall make reasonable efforts to collect all payments
called for under the terms and provisions of the Loans, and shall, to the extent
such procedures shall be consistent with this Agreement, follow such collection
procedures as it follows with respect to conventional mortgage loans it services
for itself and any of its Affiliates; provided, however, that the Servicers
agree not to permit any modification with respect to any Loan that would change
the manner in which the Mortgage Interest Rate is computed, forgive any
principal or interest or change the term of such Loan. Consistent with the
foregoing, each Servicer may in its discretion (i) waive any assumption fee,
late payment charge or other charge in connection with a Loan, and (ii) arrange
a schedule, running for no more than 180 days after the scheduled Due Date, for
payment of any installment on any Mortgage Note or after the due date of any
other payment due under the related Mortgage Note for the liquidation of
delinquent items, provided, that such Servicer shall continue
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to be obligated to make Advances in accordance with Section 4.3 during the
continuance of such period. With respect to any Loans which provide for the
right of the holder thereof to call for early repayment thereof at times
specified therein, neither the Trustee nor a Servicer shall exercise any such
right, except that the Trustee shall exercise such right at the written
direction of a Servicer set forth in an Officer's Certificate in connection with
a default under the related Note. Notwithstanding anything herein to the
contrary, neither the Servicers nor any other party may take any action that
would cause a "significant modification" of any Loan within the meaning of the
REMIC Provisions that would cause REMIC I, REMIC II or REMIC III to fail to
qualify as a REMIC at any time or cause a tax to be imposed on the Trust Fund
under the REMIC Provisions.
(b) Each Servicer shall establish and maintain one or more separate
accounts as set forth in Article I (collectively, the "Custodial Account for
P&I"), and shall on the Closing Date credit any amounts representing scheduled
payments of principal and interest due after the Cut-off Date but received by
the related Servicer on or before the Closing Date, and thereafter on a daily
basis the following payments and collections received or made by it (other than
in respect of principal of and interest on the Loans due on or before the
Cut-off Date):
(i) All Mortgagor payments on account of principal, including
Principal Prepayments on the Loans;
(ii) All Mortgagor payments on account of interest on the
Loans, which may be net of that portion thereof which the related
Servicer is entitled to retain as Servicing Fees (adjusted for any
amounts related to Compensating Interest) or other servicing
compensation (including any prepayment penalties) pursuant to Section
3.9, as adjusted pursuant to Section 4.6;
(iii) All net Liquidation Proceeds;
(iv) All Insurance Proceeds received by a Servicer, other than
proceeds to be applied to the restoration or repair of the property
subject to the related Mortgage or released to the Mortgagor in
accordance with the related Servicer's normal servicing procedures, and
all amounts deposited by a Servicer with respect to the failure to
maintain flood or fire and hazard insurance policies, pursuant to
Section 3.5;
(v) All repurchase proceeds from the repurchase of a Loan
pursuant to a Purchase Obligation;
(vi) any amounts required to be deposited pursuant to Section
3.2(c) in connection with net losses realized on Eligible Investments
with respect to funds held in the Custodial Account for P&I;
(vii) all income and gain realized from any investment of the
funds in the Custodial Account for P&I in Eligible Investments;
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(viii) all net income from the renting of REO Property
pursuant to Section 3.7(c); and
(ix) All other amounts required to be deposited in the
Custodial Account for P&I pursuant to this Agreement.
(c) Each Servicer may invest the funds in the Custodial Account for P&I
in Eligible Investments which shall mature not later than the Business Day
preceding the next Distribution Date. The Eligible Investments may not be sold
or disposed of prior to their maturity. All such Eligible Investments shall be
made in the name of such Servicer (in its capacity as such) or its nominee. All
income and gain realized from any such investment shall be for the benefit of
the related Servicer, and shall be payable to such Servicer. The amount of any
losses incurred in respect of any such investments shall be deposited in the
Custodial Account for P&I by such Servicer, out of its own funds immediately as
realized without right to reimbursement therefor.
(d) The foregoing requirements for deposit in the Custodial Account for
P&I shall be exclusive, it being understood and agreed that, without limiting
the generality of the foregoing, payments in the nature of those described in
the last paragraph of this Section 3.2 and payments in the nature of late
payment charges or assumption fees need not be deposited by a Servicer in the
Custodial Account for P&I. All funds deposited by a Servicer in the Custodial
Account for P&I shall be held by it in trust in the Custodial Account for P&I
until disbursed in accordance with Section 4.1 or withdrawn in accordance with
Section 3.3; provided, however, that the Servicers shall withdraw such funds and
deposit them in such manner as to not result in a downgrading or withdrawal of
the rating then assigned to the Certificates by each Rating Agency. If the
related Servicer deposits in the Custodial Account for P&I any amount not
required to be deposited therein, it may at any time withdraw such amount from
the Custodial Account for P&I pursuant to Section 3.3(i) of this Agreement.
Certain of the Loans may provide for payment by the Mortgagor of
amounts to be used for payment of taxes, assessments, hazard or other insurance
premiums or comparable items for the account of the Mortgagor. Each Servicer may
deal with these amounts in accordance with its normal servicing procedures.
Section 3.3 PERMITTED WITHDRAWALS FROM THE CUSTODIAL ACCOUNT FOR P&I.
Each Servicer may, from time to time, make withdrawals from the Custodial
Account for P&I for the following purposes:
(a) to reimburse itself for Advances made by or on behalf of it
pursuant to Section 3.4 or 4.3, each Servicer's right to reimburse itself
pursuant to this subclause (a) being limited to (i) amounts received on or in
respect of particular Loans (including, for this purpose, Liquidation Proceeds
and Insurance Proceeds which represent late recoveries of payments of principal
and/or interest respecting which any such Advance was made and any net income
received from the renting
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of REO Property pursuant to Section 3.7(c)) and (ii) amounts in the Custodial
Account for P&I held for future distribution or withdrawal, such amounts
referred to in clause (ii) of this subclause (a) to be replaced by a Servicer to
the extent that funds in the Custodial Account for P&I on a future Withdrawal
Date are less than the payment required to be made to the Certificate Account
therefrom as of such future Distribution Date;
(b) (i) to reimburse itself from Liquidation Proceeds for Liquidation
Expenses, (ii) for amounts expended by it pursuant to Section 3.7 in good faith
in connection with the restoration of damaged property and (iii) to the extent
that Liquidation Proceeds after such reimbursement are in excess of the
Principal Balance of the related Loan together with accrued and unpaid interest
thereon at the applicable Pass-Through Rate to the date of such liquidation, net
of any related Advances which were unreimbursed prior to the receipt of such
Liquidation Proceeds, to pay to itself any unpaid Servicing Fees, and any
assumption fees, late payment charges or other Mortgage charges on the related
Loan;
(c) to pay to itself from any Mortgagor payment as to interest or other
recovery with respect to a particular Loan, to the extent permitted by this
Agreement, that portion of any payment as to interest in excess of interest at
the applicable Pass-Through Rate which a Servicer is entitled to retain as
Servicing Fees pursuant to Section 3.9 or otherwise;
(d) to reimburse itself for expenses incurred by and recoverable by or
reimbursable to it pursuant to Section 3.1 or 3.5 after the related Mortgagor
has reimbursed the Trust Fund for such expenses or following liquidation of the
related Loan, or pursuant to Section 6.3;
(e) to pay to itself with respect to each Loan or property acquired in
respect thereof that has been repurchased pursuant to Section 2.2 or 2.3 or
purchased by a Servicer pursuant to Section 9.1 all amounts received thereon and
not distributed as of the date on which the related Principal Balance is
determined;
(f) to reimburse itself for any Nonrecoverable Advances;
(g) to disburse to the Trustee or its designee in order that the
Trustee or its designee may make payments to Certificateholders in the amounts
and in the manner provided for in Section 4.1;
(h) to pay itself any net interest or other income earned and received
on or investment income received with respect to funds in the Custodial Account
for P&I; and
(i) to make payments to itself or others pursuant to any provision of
this Agreement and to remove any amounts not required to be deposited therein
and to clear and terminate the Custodial Account for P&I pursuant to Section
9.1.
Since in connection with withdrawals pursuant to subclauses (a), (b),
(c) and (e) each Servicer's entitlement thereto is limited to collections or
other recoveries on the related Loan, the
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Servicers shall keep and maintain a separate accounting for each Loan for the
purpose of justifying any withdrawal from the Custodial Account for P&I pursuant
to such subclauses.
Each Servicer shall make the withdrawal referred to in subclause (g)
above and shall deposit the amount so withdrawn into the Certificate Account
prior to 4:00 P.M. New York City time on each related Withdrawal Date.
Each Servicer may establish, or cause to be established, two or more
Custodial Accounts for P&I into which funds collected by such Servicer or its
subservicers in connection with the related Loans may be deposited. Funds
collected in connection with mortgage loans other than the related Loans may
also be deposited in the Custodial Accounts for P&I and co-mingled with
collections on the related Loans. Each Servicer may, in its discretion, withdraw
funds from one Custodial Account for P&I and deposit such funds into another
Custodial Account for P&I prior to the date such funds must be deposited in the
Certificate Account.
Section 3.4 TAXES, ASSESSMENTS AND SIMILAR ITEMS; ESCROW ACCOUNTS.
(a) Each Servicer shall establish and maintain one or more accounts
(each, an "Escrow Account") into which all Escrow Payments shall be promptly
deposited and in which all Escrow Payments shall be retained. Escrow Accounts
shall be Eligible Accounts, and funds in the Escrow Account may be invested in
Eligible Investments. Each Servicer shall notify the Trustee in writing of the
location and account number of each Escrow Account it establishes and shall
notify the Trustee prior to any subsequent change thereof. Withdrawals of
amounts from an Escrow Account may be made only to: (i) effect payment of taxes,
assessments, insurance premiums and comparable items; (ii) refund to Mortgagors
any sums that are determined to be overages; (iii) reimbursement to the related
Servicer for any cost incurred in paying taxes, insurance premiums and
assessments or comparable items; (iv) pay interest, if required and as described
below, to Mortgagors on balances in the Escrow Account; (v) withdraw interest or
other income which may lawfully be retained by the Trust Fund, for deposit into
the Certificate Account; or (vi) clear and terminate the Escrow Account at the
termination of this Agreement in accordance with Section 9.1. Unless otherwise
required by applicable law, any interest earned on funds in Escrow Accounts
shall be remitted to the related Mortgagors if required by the related Mortgage
Note or otherwise to the related Servicer as additional servicing compensation.
(b) With respect to each Loan, the related Servicer shall maintain, or
cause to be maintained, accurate records with respect to each related Mortgaged
Property reflecting the status of taxes, assessments and other similar items
that are or may become a lien on the related Mortgaged Property and the status
of insurance premiums payable with respect thereto. Each Servicer shall require
that payments for taxes, assessments, insurance premiums and other similar items
be made by the Mortgagor at the time they first become due. If a Mortgagor fails
to make any such payment on a timely basis, the related Servicer shall advance,
or cause to be advanced, the amount of any shortfall unless such Servicer
determines in its good faith judgment that such advance would not be ultimately
recoverable from future payments and collections on the related Loan (including
without
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limitation Insurance Proceeds and Liquidation Proceeds), or otherwise. Each
Servicer shall be entitled to reimbursement of advances made pursuant to the
preceding sentence, together with interest thereon at the Federal Funds Rate,
from amounts received on or in respect of the related Loan respecting which such
advance was made or if such advance has become nonrecoverable, in either case to
the extent permitted by Section 3.3 of this Agreement. No costs incurred by a
Servicer in effecting the payment of taxes and assessments on the Mortgaged
Properties shall, for the purpose of calculating distributions to
Certificateholders, be added to the amount owing under the related Loans,
notwithstanding that the terms of such Loans so permit.
Each Servicer may establish, or cause to be established, two or more
Escrow Accounts into which funds collected by such Servicer or its subservicers
in connection with the Loans may be deposited. Funds collected in connection
with mortgage loans other than the Loans may also be deposited in the Escrow
Accounts and co-mingled with collections on the Loans. Each Servicer may, in its
discretion, withdraw funds from one Escrow Account and deposit such funds into
another Escrow Account prior to the date such funds must be used to make Escrow
Payments.
Section 3.5 MAINTENANCE OF INSURANCE. Each Servicer shall also cause to
be maintained for each 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 Principal Balance of such Loan
or (ii) the replacement value costs of improvements securing such Loan. Each
Servicer shall cause to be maintained fire and hazard insurance with extended
coverage on each REO Property in an amount which is at least equal to the
greater of (i) an amount not less than is necessary to avoid the application of
any co-insurance clause contained in the related fire and hazard insurance
policy or (ii) the replacement cost of the improvements which are a part of such
property. Each Servicer shall also cause to be maintained for each Loan with a
Loan-to-Value Ratio greater than 80% a primary mortgage insurance policy which
will cover at least 75% of the original fair market value of the related
Mortgaged Property until such time as the principal balance of such Loan is
reduced to 80% of the current fair market value or otherwise in accordance with
applicable law. Each Servicer on behalf of the Trustee as Mortgagee shall
maintain or cause the related Mortgagor to maintain for each Loan such other
insurance on the related Mortgaged Property as may be required by the terms of
the related Mortgage Note. If the Mortgaged Property is in an area identified in
the Federal Register by the Flood Emergency Management Agency as having special
flood hazards each 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 full insurable value,
(ii) the maximum amount of insurance which is available under the Flood Disaster
Protection Act of 1973, and (iii) the Principal Balance of the related Loan.
Each Servicer shall also maintain fire and hazard insurance with extended
coverage and, if applicable, flood insurance on property acquired upon
foreclosure, or by deed in lieu of foreclosure, of any Loan in an amount that is
at least equal to the lesser of (i) the maximum insurable value of the
improvements which are a part of such property and (ii) the principal balance
owing on such Loan at the time of such foreclosure or grant of deed in lieu of
foreclosure plus accrued interest and related Liquidation Expenses. If an REO
Property was located at the time of origination of the related Loan in a
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federally designated special flood hazard area, the related Servicer will obtain
flood insurance in respect thereof providing substantially the same coverage as
described in the preceding sentence. If at any time during the term of this
Agreement a recovery under a flood or fire and hazard insurance policy in
respect of an REO Property is not available but would have been available if
such insurance were maintained thereon in accordance with the standards applied
to Mortgaged Properties described herein, the related Servicer shall either (i)
immediately deposit into the Custodial Account for P&I from its own funds the
amount that would have been recovered or (ii) apply to the restoration and
repair of the property from its own funds the amount that would have been
recovered, if such application would be consistent with the servicing standard
set forth in Section 3.1. It is understood and agreed that such insurance shall
be with insurers approved by the related Servicer and that no earthquake or
other additional insurance is to be required of any Mortgagor, other than
pursuant to such applicable laws and regulations or policies of the related
Servicer as shall at any time be in force and as shall require such additional
insurance. Pursuant to Section 3.2, any amounts collected by a Servicer under
any insurance policies maintained pursuant to this Section 3.5 (other than
amounts to be applied to the restoration or repair of the property subject to
the related Mortgage or released to the Mortgagor in accordance with the related
Servicer's normal servicing procedures) shall be deposited into the Custodial
Account for P&I, subject to withdrawal pursuant to Section 3.3. Any cost
incurred by a Servicer in maintaining any such insurance shall be recoverable by
such Servicer pursuant to Section 3.3. In the event that a Servicer shall obtain
and maintain a blanket policy issued by an insurer that qualifies under the
guidelines set forth for such Servicer by FNMA or FHLMC, insuring against hazard
losses on all of the Loans, then, to the extent such policy provides coverage in
an amount equal to the unpaid principal balance on the Loans without
co-insurance and otherwise complies with all other requirements set forth in the
first paragraph of this Section 3.5, it shall conclusively be deemed to have
satisfied its obligation as set forth in such first paragraph, it being
understood and agreed that such policy may contain a deductible clause, in which
case such Servicer shall, in the event that there shall not have been maintained
on the related mortgaged or acquired property an insurance policy complying with
the first paragraph of this Section 3.5 and there shall have been a loss which
would have been covered by such a policy had it been maintained, be required to
deposit from its own funds into the Custodial Account for P&I or apply to the
restoration of the property the amount not otherwise payable under the blanket
policy because of such deductible clause.
Each Servicer shall obtain and maintain at its own expense throughout
the term of this Agreement a blanket fidelity bond and an errors and omissions
insurance policy with broad coverage with responsible companies covering such
Servicer's officers and employees and other persons acting on behalf of such
Servicer in connection with its activities under this Agreement. Any such
fidelity bond and errors and omissions insurance shall provide an amount of
coverage and will maintain such coverage at a level which will permit the
related Servicer to continue to be a FNMA or a FHLMC-qualified Servicer and
shall protect and insure such Servicer against losses, including forgery, theft,
embezzlement, fraud, errors and omissions and negligent acts of such persons. No
provision of this Section 3.5 requiring such fidelity bond and errors and
omissions insurance shall diminish or relieve a Servicer from its duties and
obligations as set forth in this Agreement.
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Section 3.6 ENFORCEMENT OF DUE-ON-SALE CLAUSES; ASSUMPTION AND
SUBSTITUTION AGREEMENTS.
In any case in which property subject to a Mortgage is conveyed by the
Mortgagor, the related Servicer will enforce any due-on-sale clause contained in
the related Mortgage Note or Mortgage, to the extent permitted under applicable
law and governmental regulations, but only to the extent that such enforcement
will not adversely affect or jeopardize coverage under any related insurance
policy or result in legal action by the Mortgagor. Subject to the foregoing,
each Servicer is authorized to take or enter into an assumption or substitution
agreement from or with the Person to whom such property has been or is about to
be conveyed. Each Servicer is also authorized to release the original Mortgagor
from liability upon the Loan and substitute the new Mortgagor as obligor
thereon. In connection with such assumption or substitution, the related
Servicer shall apply such underwriting standards and follow such practices and
procedures as shall be normal and usual and as it applies to mortgage loans
owned solely by it or any of its Affiliates. The related Servicer shall notify
the Trustee that any such assumption or substitution agreement has been
completed by forwarding to the Trustee the original copy of such assumption or
substitution agreement, which copy shall be added by the Trustee to the related
Mortgage File and 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. In connection with any such assumption or substitution agreement,
the interest rate of the related Mortgage Note shall not be changed. Any fee
collected by the related Servicer for entering into an assumption or
substitution of liability agreement will be retained by such Servicer as
servicing compensation.
Notwithstanding the foregoing paragraph or any other provision of this
Agreement, a Servicer shall not be deemed to be in default, breach or any other
violation of its obligations hereunder by reason of any conveyance by the
Mortgagor of the Mortgaged Property or any assumption of a Loan by operation of
law which a Servicer in good faith determines it may be restricted by law from
preventing, for any reason whatsoever.
Section 3.7 REALIZATION UPON DEFAULTED LOANS.
(a) Consistent with the servicing standard set forth in Section 3.1 and
with a view to the best economic interest of the Trust Fund, the related
Servicer shall foreclose upon or otherwise comparably convert (which may include
acquisition of an REO Property) the Mortgaged Properties securing such of the
Loans as come into and continue in default and as to which no satisfactory
arrangements can be made for collection of delinquent payments pursuant to
Section 3.2. In connection with such foreclosure or other conversion, such
Servicer shall follow such practices and procedures as it shall deem necessary
or advisable and as shall be normal and usual in its general mortgage servicing
activities. The foregoing is subject to the proviso that a Servicer shall not be
required to expend its own funds in connection with any foreclosure or to
restore any damaged property unless it shall determine (i) that such foreclosure
and/or restoration expenses will increase the Liquidation Proceeds to
Certificateholders after reimbursement to itself for such expenses and (ii) that
such expenses will be recoverable to it through Liquidation Proceeds (respecting
which it
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shall have priority for purposes of withdrawal from the Custodial Account for
P&I pursuant to Section 3.3). Any gain on foreclosure or other conversion of a
Liquidated Loan shall be distributed to the Class R Certificateholder, but only
to the extent that such gain is not necessary to make distributions to the
Certificateholders of the other Classes of Certificates. Each Servicer shall be
responsible for all other costs and expenses incurred by it in any such
proceedings; provided, however, that it shall be entitled to reimbursement
thereof (as well as any Servicing Fees and other amounts due it, if any), to the
extent, but only to the extent, that withdrawals from the Custodial Account for
P&I with respect thereto are permitted under Section 3.3. Within 30 days after
receipt of Liquidation Proceeds in respect of a Liquidated Loan, the related
Servicer shall provide to the Trustee a statement of accounting for the related
Liquidated Loan, including without limitation (i) the Loan number, (ii) the date
the Loan was acquired in foreclosure or deed in lieu, and the date the Loan
became a Liquidated Loan, (iii) the gross sales price and the related selling
and other expenses, (iv) accrued interest calculated from the foreclosure date
to the liquidation date, and (v) such other information as the Trustee may
reasonably specify.
(b) Prior to any such foreclosure, with respect to (a) any Group I
Loan, WMMSC may, at its option, repurchase any Group I Loan which is 90 days or
more delinquent and which WMMSC determines in good faith would otherwise become
subject to foreclosure proceedings or any Group I Loan as to which the Mortgagor
tenders a deed in lieu of foreclosure at a price equal to the outstanding
Principal Balance of the Loan plus accrued interest at the applicable
Pass-Through Rate to the next Due Date; and (b) any Group II Loan, AAMG may, at
its option, repurchase any Group II Loan which is 30 days or more delinquent;
provided that any such repurchase shall only be made if (i) the related Servicer
has a contractual right to require the third party seller of such delinquent
Loan to repurchase such Loan, (ii) such repurchase is made to facilitate a
repurchase by such third party seller and (iii) such repurchase is made at a
price equal to the Purchase Price. Any such repurchase shall be deemed a
Principal Prepayment for purposes of this Agreement and all amounts in respect
thereof shall be deposited into the Custodial Account for P&I pursuant to
Section 3.2(b).
(c) The Trust Fund shall not acquire any real property (or personal
property incident to such real property) except in connection with a default or
imminent default of a Loan. Based on a report prepared by an Independent Person
who regularly conducts environmental audits that the Mortgaged Property for
which foreclosure proceedings are contemplated is not in compliance with
applicable environmental laws, or there are circumstances present at such
Mortgaged Property relating to the use, management or disposal of any hazardous
materials, 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 that it would be in the best economic
interest of the Trust Fund to acquire title to such Mortgaged Property and
further to take such actions as would not be necessary and appropriate to effect
such compliance and/or respond to such circumstances, the related Servicer will
not conduct such foreclosure proceedings. If a Servicer otherwise becomes aware,
under its customary servicing procedures, of an environmental hazard with
respect to a Loan for which foreclosure proceedings are contemplated, such
Servicer will not conduct such foreclosure proceedings unless it determines in
good faith that the liability associated with the environmental hazard will be
less than the Liquidation Proceeds to be realized from the sale of the related
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Mortgaged Property. In the event that the Trust Fund acquires any real property
(or personal property incident to such real property) in connection with a
default or imminent default of a Loan, such REO Property shall be disposed of by
the Trust Fund within three years after its acquisition by the Trust Fund unless
the Trustee shall have received from the related Servicer an Opinion of Counsel
to the effect that the holding by the Trust Fund of such REO Property subsequent
to three years after its acquisition will not cause any of REMIC I, REMIC II or
REMIC III to fail to qualify as a REMIC under the REMIC Provisions at any time
that any REMIC I Regular Interests or Certificates are outstanding, in which
case such REO Property shall be disposed of as soon as possible by the Trust
Fund but in no event shall be held longer than the maximum period of time during
which the Trust Fund is then permitted to hold such REO Property and allow REMIC
I, REMIC II and REMIC III to remain qualified as REMICs under the REMIC
Provisions. The related Servicer shall manage, conserve, protect and operate
each such REO Property for the Certificateholders 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. Pursuant to its efforts to sell such REO Property, the
related Servicer shall either itself or through an agent selected by such
Servicer protect and conserve such REO Property in the same manner and to such
extent as is customary in the locality where such property is located and may,
incident to its conservation and protection of the interests of the
Certificateholders, rent the same, or any part thereof, as such Servicer deems
to be in the best interest of such Servicer and the Certificateholders for the
period prior to the sale of such REO Property. All proceeds from the renting of
such REO Property shall, net of any costs or expenses of the related Servicer in
connection therewith, be deposited into the Custodial Account for P&I pursuant
to Section 3.3(b)(viii).
(d) In the event that title to any Mortgaged Property is acquired in
foreclosure or by deed in lieu of foreclosure, the deed or certificate of sale
shall be issued to the Trustee, or to its nominee on behalf of
Certificateholders. Notwithstanding any such acquisition of title and
cancellation of the related Loan, such Loan shall (except for purposes of
Section 9.1) be considered to be a Loan held in the Trust Fund until such time
as the related REO Property shall be sold by the Trust Fund and shall be reduced
only by collections net of expenses. Consistent with the foregoing, for purposes
of all calculations hereunder, so long as such Loan shall be considered to be an
outstanding Loan, it shall be assumed that, notwithstanding that the
indebtedness evidenced by the related Mortgage Note shall have been discharged,
such Mortgage Note and, for purposes of determining the Scheduled Principal
Balance thereof, the related amortization schedule in effect at the time of any
such acquisition of title remain in effect.
(e) The Servicers shall not acquire for the benefit of the Trust Fund
any personal property pursuant to this Section 3.7 unless either:
(i) such personal property is incident to real property
(within the meaning of Section 856(e)(1) of the Code) so acquired by a
Servicer for the benefit of the Trust Fund; or
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(ii) the related Servicer shall have requested and received an
Opinion of Counsel (which opinion shall be an expense of the Trust
Fund) to the effect that the holding of such personal property by the
Trust Fund will not cause the imposition of a tax on the Trust Fund
under the REMIC Provisions or cause any of REMIC I, REMIC II or REMIC
III of the Trust Fund to fail to qualify as a REMIC at any time that
any Certificate is outstanding.
Section 3.8 TRUSTEE TO COOPERATE; RELEASE OF MORTGAGE FILES.
Upon the payment in full of any Loan, or the receipt by the related
Servicer of a notification that the payment in full will be escrowed in a manner
customary for such purposes, such Servicer will immediately notify the Trustee
by an Officer's Certificate (which Officer's Certificate shall include a
statement to the effect that all amounts received in connection with such
payment which are required to be deposited in the Custodial Account for P&I
pursuant to Section 3.2 have been or will be so deposited) and shall by such
Officer's Certificate request delivery to it of the Mortgage File. Upon receipt
of such Officer's Certificate and request, the Trustee, the Custodian or any
such sub-custodian, as applicable, shall not later than the 5th Business Day
release or cause to be released the related Mortgage File to the related
Servicer. Upon the Trustee's receipt of any release or reconveyance documents or
instruments relating to the Loan paid in full, the Trustee shall, not later than
the 5th succeeding Business Day, execute and return such documents and
instruments to such Servicer. From time to time and as appropriate for the
servicing or foreclosure of any Loan, the Trustee shall, upon written request of
the related Servicer and delivery to the Trustee of a trust receipt signed by a
Servicing Officer, release or cause to be released , not later than the 5th
succeeding Business Day, the related Mortgage File to the related Servicer and
shall execute such documents furnished to it as shall be necessary to the
prosecution of any such proceedings. Such trust receipt shall obligate the
related Servicer to return each and every document previously requested from the
Mortgage File to the Trustee when the need therefor by such Servicer no longer
exists unless the Loan shall be liquidated, in which case, upon receipt of a
certificate of a Servicing Officer similar to that hereinabove specified, the
trust receipt shall be released by the Trustee to the related Servicer by
delivery to a Servicing Officer and the Trustee shall have no further
responsibility with respect to such Mortgage Files.
Section 3.9 SERVICING COMPENSATION.
Each Servicer shall be entitled to retain or, if not retained, to
withdraw from the Certificate Account or the Custodial Account for P & I as
servicing compensation its Servicing Fee out of each payment on account of
interest on each Loan, subject to adjustment as provided in Section 4.6. Each
Servicer shall also be entitled to payment of unpaid Servicing Fees with respect
to a delinquent Loan out of Liquidation Proceeds with respect to such Loan, to
the extent permitted by Section 3.3(b). Servicing compensation in the form of
assumption fees, late payment charges or otherwise shall be retained by the
related Servicer and need not be deposited in the Custodial Account for P&I.
Each Servicer shall also be entitled to additional servicing compensation out of
Liquidation Proceeds to the extent provided in Section 3.3(b). Each Servicer
shall be required to pay all expenses incurred by it in connection with its
servicing activities hereunder (including maintenance of the blanket
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hazard insurance policy and the blanket fidelity bond and errors and omissions
policy required by Section 3.5) and shall not be entitled to reimbursement
therefor except as specifically provided in Sections 3.1, 3.3, 3.5 and 3.7.
On each Distribution Date, AAMG shall pay to the Certificate
Administrator and the Trustee the Certificate Administration and Trustee Fee out
of the Servicing Fee retained by AAMG on such Distribution Date. Such amounts
shall be compensation for the activities of the Certificate Administrator and
the Trustee hereunder in respect of both Loan Groups. The Certificate
Administrator and the Trustee shall be required to pay all expenses incurred by
it in connection with its activities hereunder and shall not be entitled to
reimbursement therefor, except as specifically provided herein.
Section 3.10 REPORTS TO THE TRUSTEE; CUSTODIAL ACCOUNT FOR P&I
STATEMENTS
With respect to WMMSC, on or before 12:00 noon (New York City time) on
the second Business Day following the 18th day of the month in which each
Distribution Date occurs, and with respect to AAMG, on or before each
Determination Date, such Servicer shall deliver or cause to be delivered to the
Trustee or its designee a statement in electronic or written form as may be
agreed upon by such Servicers and the Trustee containing the information
described in Section 4.2 and such other information as may be necessary for the
Trustee to distribute the amounts to be distributed to the Certificateholders by
the Trustee (the "Servicer's Section 3.10 Report"). Not later than 25 days after
each Distribution Date, each Servicer shall forward or cause to be forwarded to
the Trustee a statement, certified by a Servicing Officer, setting forth the
status of the Custodial Account for P&I as of the close of business on the
related Distribution Date, stating that all distributions from the Custodial
Account for P&I required to be made by this Agreement have been made for the
period covered by such statement (or if any required distribution has not been
made, specifying the nature and status thereof) and showing, for the period
covered by such statement, the aggregate of deposits into the Certificate
Account and withdrawals from the Custodial Account for P&I for each category of
deposit specified in Section 3.2 and each category of withdrawal specified in
Section 3.3. Such statement shall also include information as to the aggregate
Principal Balance of all of the Loans as of the last day of the calendar month
immediately preceding such Distribution Date. Copies of such statement shall be
provided to any Certificateholder upon request by the related Servicer, or by
the Trustee so long as the Trustee has received the report as stipulated above
at such Servicer's expense if such Servicer shall fail to provide such copies.
Section 3.11 ANNUAL STATEMENT AS TO COMPLIANCE.
Not later than the earlier of (a) March 15 of each calendar year (other
than the calendar year during which the Closing Date occurs) or (b) with respect
to any calendar year during 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, 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, in
each case, if such day is not a Business Day,
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the immediately preceding Business Day), each Servicer will deliver to the
Trustee an Officer's Certificate stating as to each signer thereof, that (i) a
review of the activities of the related Servicer during the preceding calendar
year and of performance under this Agreement has been made under such officer's
supervision, and (ii) to the best of such officer's knowledge, based on such
review, the related Servicer has fulfilled all of its obligations under this
Agreement throughout such year, or if there has been a default in the
fulfillment of any such obligation, specifying each such default known to such
officer and the nature and status thereof. Copies of such statement shall be
provided to each Rating Agency and to any Certificateholder upon request by the
related Servicer, or by the Trustee at the related Servicer's expense.
Section 3.12 ANNUAL INDEPENDENT PUBLIC ACCOUNTANTS' SERVICING REPORT.
Not later than the earlier of (a) March 15 of each calendar year (other than the
calendar year during which the Closing Date occurs) or (b) with respect to any
calendar year during 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, 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, in
each case, if such day is not a Business Day, the immediately preceding Business
Day), WMMSC, at its expense, shall furnish to the Trustee a copy of a report
delivered to WMMSC by a firm of independent public accountants (who may also
render other services to such Servicer, any Seller or any affiliate thereof) who
are members of the American Institute of Certified Public Accountants to furnish
a statement to the Trustee, the Certificate Administrator and each Rating Agency
to the effect that, (i) it has obtained a letter of representation regarding
certain matters from the management of such Servicer which includes an assertion
that such Servicer has complied with certain minimum residential mortgage loan
servicing standards, in its role as master servicer, 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. In connection with such letter of representation, such Servicer
shall disclose to such firm of independent public accountants all significant
deficiencies relating to such Servicer's compliance with the minimum servicing
standards set forth in this Agreement. In rendering its report such firm may
rely, as to matters relating to the direct servicing of residential mortgage
loans by subservicers, upon comparable reports of firms of independent certified
public accountants rendered on the basis of examinations conducted in accordance
with the same standards (rendered within one year of such report) with respect
to those subervicers.
Not later than the earlier of (a) March 15 of each calendar year (other
than the calendar year during which the Closing Date occurs) or (b) with respect
to any calendar year during 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, 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, in
each case, if such day is not a Business Day, the immediately preceding Business
Day), AAMG, at its expense, shall cause a firm of independent
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public accountants who are members of the American Institute of Certified Public
Accountants to furnish a statement to the Trustee, the Certificate Administrator
and each Rating Agency to the effect that such firm has examined certain
documents and records relating to the servicing of the Group II Loans and that,
either (a) on the basis of such examination conducted substantially in
compliance with the audit program for mortgages serviced for FHLMC, such firm is
of the opinion that such servicing has been conducted in compliance with the
manner of servicing set forth in agreements substantially similar to this
Agreement except for (i) such exceptions as such firm shall believe to be
immaterial and (ii) such other exceptions as shall be set forth in such
statement or, (b) that their examination conducted substantially in compliance
with the uniform single audit program for mortgage bankers disclosed no
exceptions or errors in records relating to mortgage loans serviced for others
that in their opinion are material and that Paragraph 4 of that program requires
them to report. Copies of the statements required above shall be provided to
Certificateholders upon request by the related Servicer, or by the Trustee at
the related Servicer's expense.
Section 3.13 ACCESS TO CERTAIN DOCUMENTATION AND INFORMATION REGARDING
THE LOANS. Each Servicer shall provide access to the Trustee or to its designees
at its request, and to Certificateholders which are savings and loan
associations, banks or insurance companies, the OTS, the FDIC and the
supervisory agents and examiners of the OTS and the FDIC or examiners of any
other federal or state banking or insurance regulatory authority to the
documentation regarding the Loans if so required by applicable regulations of
the OTS or other regulatory authority, such access to be afforded without charge
but only upon reasonable request and during normal business hours at the offices
of the related Servicer designated by it. The Trustee or its designee may
without charge copy any document or electronic record maintained by each
Servicer hereunder.
Section 3.14 [RESERVED].
Section 3.15 SALE OF DEFAULTED LOANS AND REO PROPERTIES.
(a) With respect to any Defaulted Loan or REO Property which a Servicer
has determined to sell in accordance with the standards set forth in Section
3.7, such Servicer shall deliver to the Trustee an Officer's Certificate to the
effect that no satisfactory arrangements can be made for collection of
delinquent payments thereon pursuant to Section 3.2, and, consistent with the
servicing standard set forth in Section 3.1 and with a view to the best economic
interest of the Trust Fund, such Servicer has determined to sell such Defaulted
Loan or REO Property in accordance with this Section 3.15. The related Servicer
may then offer to sell to any Person any Defaulted Loan or any REO Property or,
subject to the following sentence, purchase any such Defaulted Loan or REO
Property (in each case at the Purchase Price therefor), but shall in any event,
so offer to sell any REO Property no later than the time determined by such
Servicer to be sufficient to result in the sale of such REO Property within the
period specified in Section 3.7(c). The related Servicer shall accept the
highest bid received from any Person for any Defaulted Loan or any REO Property
in an amount at least equal to the Purchase Price therefor or, at its option, if
it has received no bid at least equal to the Purchase Price therefor, purchase
the Defaulted Loan or REO Property at the Purchase Price.
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In the absence of any such bid or purchase by the related Servicer,
such Servicer shall accept the highest bid received from any Person that is
determined by such Servicer to be a fair price for such Defaulted Loan or REO
Property, if the highest bidder is a Person other than an Interested Person, or
is determined to be such a price by the Trustee, if the highest bidder is an
Interested Person. Notwithstanding anything to the contrary herein, neither the
Trustee, in its individual capacity, nor any of its Affiliates may bid for or
purchase any Defaulted Loan or any REO Property pursuant hereto.
The related Servicer shall not be obligated by either of the foregoing
paragraphs or otherwise to accept the highest bid if such Servicer determines,
in accordance with the servicing standard stated in Section 3.1, that rejection
of such bid would be in the best interests of the Certificateholders. In
addition, the related Servicer may accept a lower bid if it determines, in
accordance with the servicing standard stated in Section 3.1, that acceptance of
such bid would be in the best interests of the Certificateholders (for example,
if the prospective buyer making the lower bid is more likely to perform its
obligations, or the terms offered by the prospective buyer making the lower bid
are more favorable). In the event that the related Servicer determines with
respect to any REO Property that the bids being made with respect thereto are
not in the best interests of the Certificateholders and that the end of the
period referred to in Section 3.7(c) with respect to such REO Property is
approaching, the related Servicer shall seek an extension of such period in the
manner described in Section 3.7(c).
(b) In determining whether any bid received from an Interested Person
represents a fair price for any Defaulted Loan or any REO Property, the Trustee
may conclusively rely on the opinion of an Independent appraiser or other expert
in real estate matters retained by the related Servicer the expense of which
shall be an expense of the Trust Fund. In determining whether any bid
constitutes a fair price for any Defaulted Loan or any REO Property, the related
Servicer or the Trustee (or, if applicable, such appraiser) shall take into
account, and any appraiser or other expert in real estate matters shall be
instructed to take into account, as applicable, among other factors, the period
and amount of any delinquency on the affected Defaulted Loan, the physical
condition of the related Mortgaged Property or such REO Property, the state of
the local economy and the Trust Fund's obligation to dispose of any REO Property
within the time period specified in Section 3.7(c).
(c) Each Servicer shall act on behalf of the Trust Fund in negotiating
and taking any other action reasonably necessary or appropriate in connection
with the sale of any Defaulted Loan or REO Property, including the collection of
all amounts payable in connection therewith. Any sale of a Defaulted Loan or any
REO Property shall be without recourse to, or representation or warranty by, the
Trustee, the Depositor, the related Servicer or the Trust Fund (except that any
contract of sale and assignment and conveyance documents may contain customary
warranties of title, so long as the only recourse for breach thereof is to the
Trust Fund), and, if consummated in accordance with the terms of this Agreement,
neither the related Servicer, the Depositor nor the Trustee shall have any
liability to the Trust Fund or any Certificateholder with respect to the
purchase price therefor accepted by the related Servicer or the Trustee.
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(d) The proceeds of any sale after deduction of the expenses of such
sale incurred in connection therewith shall be promptly deposited in the
Custodial Account for P&I in accordance with Section 3.2(b).
Section 3.16 DELEGATION OF DUTIES. In the ordinary course of business,
the related Servicer or the Trustee may at any time delegate any duties
hereunder to any Person who agrees to conduct such duties in accordance with the
applicable terms of this Agreement. In case of such delegation, the related
Servicer or the Trustee shall supervise, administer, monitor and oversee the
activities of such Person hereunder to insure that such Person performs such
duties in accordance herewith and shall be responsible for the acts and
omissions of such Person to the same extent as it is responsible for its own
actions or omissions hereunder. Any such delegations shall not relieve the
related Servicer or the Trustee of its liability and responsibility with respect
to such duties, and shall not constitute a resignation within the meaning of
Section 6.4 hereof and shall be revocable by any successor Servicer or the
Trustee.
Section 3.17 [RESERVED].
Section 3.18 [RESERVED].
Section 3.19 APPOINTMENT OF A SPECIAL SERVICER. Each Servicer may enter
into a special servicing agreement with an unaffiliated holder of Subordinate
Certificates or a holder of a class of securities representing interests in such
Class of Subordinate Certificates, such agreement to be (i) substantially in the
form of Exhibit R hereto or (ii) subject to each Rating Agency's acknowledgment
that the ratings of the Certificates in effect immediately prior to the entering
into of such agreement would not be qualified, downgraded or withdrawn and the
Certificates would not be placed on credit review status (except for possible
upgrading) as a result of such agreement. Any such agreement may contain
provisions whereby such holder may instruct the related Servicer to commence or
delay foreclosure proceedings with respect to delinquent Loans and may contain
provisions for the deposit of cash by the holder that would be available for
distribution to Certificateholders if Liquidation Proceeds are less than they
otherwise may have been had the related Servicer acted in accordance with its
normal procedures.
Section 3.20 ALLOCATION OF REALIZED LOSSES.
Prior to each Distribution Date, the related Servicer shall determine
the amount of Realized Losses, if any, with respect to each Loan.
The amount of Realized Losses shall be evidenced by an Officer's
Certificate signed by a Responsible Officer of the related Servicer. All
Realized Losses, except for Excess Losses, will be allocated as follows: (i) for
losses allocable to principal (a) first, to the Subordinate Certificates in
reverse order of seniority until each of their Class Principal Balances have
been reduced to zero and (b) second, for losses on Group I Loans, to the Class
IA Certificates (other than the Class IA-2 Certificates and Class IA-X
Certificates), by Pro Rata Allocation, and for losses on Group II Loans,
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to the Class IIA Certificates (other than the Class IIA-6 Certificates and Class
IIA-X Certificates) and the Class R Certificate, by Pro Rata Allocation, until
the Certificate Principal Balances thereof have been reduced to zero; PROVIDED,
HOWEVER, that prior to the Credit Support Depletion Date if the loss is
recognized (a) with respect to a Group I Discount Loan, the Group I Discount
Fraction of such loss shall be allocated to the Class IA-P Certificates and the
remainder of such loss will be allocated as described in clause (i) above, and
(b) with respect to a Group II Discount Loan, the Group II Discount Fraction of
such loss shall be allocated to the Class IIA-P Certificates and the remainder
of such loss will be allocated as described in clause (i) above and (ii) for
losses allocable to interest (a) first, to the Subordinate Certificates in
reverse order of seniority, in reduction of accrued but unpaid interest thereon
and then in reduction of the Class Principal Balance of such Certificates and
(b) second, for losses on Group I Loans, to the Class IA Certificates (other
than the Class IA-P Certificates), by Pro Rata Allocation, and for losses on
Group II Loans to the Class IIA Certificates and the Class R Certificate (other
than the Class IIA-P Certificates), by Pro Rata Allocation, until the
Certificate Principal Balances thereof have been reduced to zero.
Excess Losses shall be allocated among the Senior Certificates and the
Subordinate Certificates by Pro Rata Allocation.
On each Distribution Date, after giving effect to the principal
distributions and allocations of losses as provided in this Agreement (without
regard to this paragraph), if the Aggregate Certificate Principal Balance of all
outstanding Classes of Certificates exceeds the aggregate principal balance of
the Loans in both Loan Groups, after deduction of (i) all principal payments due
on or before the Cut-Off Date in respect of each such Loan whether or not paid
and (ii) all amounts of principal in respect of each such Loan that have been
received or advanced and included in the related Available Distribution Amount,
and all losses in respect of such Loans that have been allocated to the
Certificates, on such Distribution Date or prior Distribution Dates, then such
excess will be deemed a principal loss and will be allocated (i) first, to the
Subordinate Certificates in reverse order of seniority until each of their Class
Principal Balances has been reduced to zero, and (ii) second, to the Senior
Certificates, other than the Interest Only Certificates, pro rata according to
their Certificate Principal Balances or, in the case of the Accrual
Certificates, the Certificate Principal Balance of such Accrual Certificate on
the Closing Date, if lower in reduction thereof.
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ARTICLE IV
PAYMENTS TO CERTIFICATEHOLDERS; ADVANCES;
STATEMENTS AND REPORTS
Section 4.1 DISTRIBUTIONS TO CERTIFICATEHOLDERS. (a) The Trustee shall
establish and maintain a separate account as set forth in Article I (the
"Certificate Account"), the purpose of which is to accept deposits from the
related Servicer and to make distributions to the Certificateholders of the
amounts set forth in this Section 4.1.
(b) On each Distribution Date, the Trustee or the Paying Agent, if any,
shall (i) withdraw from the Certificate Account the Available Distribution
Amount for such Distribution Date and shall distribute to each
Certificateholder, from the amount so withdrawn and to the extent of the
Available Distribution Amount, such Certificateholder's share (based on the
aggregate Percentage Interests represented by the Certificates of the applicable
Class held by such Certificateholder) of the amounts and in the order of
priority as set forth in the definition of "Certificate Distribution Amount",
and (ii) distribute Excess Liquidation Proceeds to the Class R Certificateholder
by wire transfer in immediately available funds for the account of the
Certificateholder, or by any other means of payment acceptable to each
Certificateholder of record on the immediately preceding Record Date (other than
as provided in Section 9.1 respecting the final distribution), as specified by
each such Certificateholder and at the address of such Holder appearing in the
Certificate Register; provided, that if the Trustee has appointed a Certificate
Administrator, such distributions in (i) and (ii) above shall be made in
accordance with written statements received from the Certificate Administrator
pursuant to Section 4.2.
(c) All reductions in the Certificate Principal Balance of a
Certificate effected by distributions of principal or allocations of Realized
Losses with respect to Loans made on any Distribution Date shall be binding upon
all Holders of such Certificate and of any Certificate issued upon the
registration of transfer or exchange therefor or in lieu thereof, whether or not
such distribution is noted on such Certificate. The final distribution of
principal of each Certificate (and the final distribution with respect to the
Class R Certificate upon termination of the Trust Fund) shall be payable in the
manner provided above only upon presentation and surrender thereof on or after
the Distribution Date therefor at the office or agency of the Trustee or
Certificate Administrator, if any, specified in the notice delivered pursuant to
Section 4.1(d) or Section 9.1.
(d) Whenever, on the basis of Curtailments, Payoffs and Monthly
Payments on the Loans and Insurance Proceeds and Liquidation Proceeds received
and expected to be received during the applicable Prepayment Period, the Trustee
believes, or the Certificate Administrator, if any, has notified the Trustee
that it believes, that the entire remaining unpaid Class Principal Balance of
any Class of Certificates will become distributable on the next Distribution
Date, the Trustee or the Certificate Administrator, if any, shall, no later than
the Determination Date of the month of such Distribution Date, mail or cause to
be mailed to each Person in whose name a Certificate to be so
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retired is registered at the close of business on the Record Date, to the
Underwriters and to each Rating Agency a notice to the effect that:
(i) it is expected that funds sufficient to make such final
distribution will be available in the Certificate Account on such
Distribution Date, and
(ii) if such funds are available, (A) such final distribution
will be payable on such Distribution Date, but only upon presentation
and surrender of such Certificate at the office or agency of the
Certificate Registrar maintained for such purpose (the address of which
shall be set forth in such notice), and (B) no interest shall accrue on
such Certificate after such Distribution Date.
Section 4.2 STATEMENTS TO CERTIFICATEHOLDERS; EXCHANGE ACT REPORTING.
(a) Not later than each Determination Date, each Servicer shall forward to the
Trustee or the Certificate Administrator, if any, the related Servicer's Section
3.10 Report setting forth certain information with respect to the Loans. With
each distribution from the Certificate Account on a Distribution Date, the
Trustee or the Certificate Administrator, if any, shall, based on the
information set forth in the related Servicer's Section 3.10 Report, prepare and
forward or make available through the Trustee's or the Certificate
Administrator's, as the case may be, internet website (which initially will be
the Certificate Administrator's internet website located at xxx.xxxxxxxx.xxx) to
each Certificateholder, a statement (each a "Certificateholders' Report")
setting forth, to the extent applicable, the amount of the distribution payable
to the applicable Class that represents principal, separately identifying the
aggregate amount of any Principal Prepayments included in such distribution. and
the amount that represents interest, and the applicable Class Principal Balances
after giving effect to such distribution.
In addition, not later than each Distribution Date, the Certificate
Administrator or Trustee, as applicable, shall forward or make available to such
Certificateholder, the Trustee (if the Trustee has appointed a Certificate
Administrator), the Depositor an additional report which sets forth with respect
to the Loans in each Loan Group:
(i) The number and aggregate Principal Balance of the Loans
delinquent one, two and three months or more;
(ii) The (A) number and aggregate Principal Balance of Loans
with respect to which foreclosure proceedings have been initiated, and
(B) the number and aggregate book value of Mortgaged Properties
acquired through foreclosure, deed in lieu of foreclosure or other
exercise of rights respecting the Trustee's security interest in the
Loans;
(iii) The aggregate Principal Balance of the Loans as of the
close of business on the last day of the related Prepayment Period;
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(iv) The amount of the Servicing Fee retained or withdrawn by
the related Servicer from the Certificate Account and the amount of any
Excess Liquidation Proceeds received by such Servicer during the
related Prepayment Period;
(v) The amount of Special Hazard Coverage available to the
Senior Certificates remaining as of the close of business on the
applicable Determination Date;
(vi) The amount of Bankruptcy Coverage available to the Senior
Certificates remaining as of the close of business on the applicable
Determination Date;
(vii) The amount of Fraud Coverage available to the Senior
Certificates remaining as of the close of business on the applicable
Determination Date;
(viii) The amount of Realized Losses incurred in respect of
each Loan Group allocable to the related Certificates on the related
Distribution Date and the cumulative amount of Realized Losses incurred
in respect of each Loan Group allocated to such Certificates since the
Cut-Off Date;
(ix) The amount of interest accrued but not paid on the each
Class of Certificates entitled to interest since (a) the prior
Distribution Date and (b) the Closing Date;
(x) The amount of funds advanced by the related Servicer on
the related Withdrawal Date;
(xi) The total amount of Payoffs and Curtailments received
during the related Prepayment Period; and
(xii) The weighted average Pass-Through Rate as of the first
day of the month immediately preceding the month of the Distribution
Date.
Upon written request by any Certificateholder, the Trustee or the
Certificate Administrator (if so appointed by the Trustee), as soon as
reasonably practicable, shall provide the requesting Certificateholder with such
information as is necessary and appropriate, in Trustee's or the Certificate
Administrator's sole discretion, for purposes of satisfying applicable reporting
requirements under Rule 144A of the Securities Act.
WMMSC may make available any reports, statements or other information
to Certificateholders, regarding the Group I Loans through the WMMSC's home page
on the world wide web. Such web page is located at "xxx.xxxxxxx.xxx" and
information is available by clicking on "Investor Information."
(b) Upon written request to the Trustee or Certificate Administrator
(if so appointed by the Trustee) by any Certificateholder who is a Holder
thereof at the time of making such request (an
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"Eligible Certificateholder"), the Trustee or the Certificate Administrator, if
applicable, shall provide in electronic format loan by loan data with respect to
the payment experience of the Loans containing at least the fields of
information listed on Exhibit E hereto (based on information provided by the
related Servicer). In addition, upon the written request of any Eligible
Certificateholder, the Trustee or the Certificate Administrator shall provide
similar loan by loan data with respect to any prior monthly remittance report to
the Certificateholders pursuant to this Agreement (as and when such information
becomes available). The expense of providing any tape or disk pursuant to this
subsection shall be an expense of the Eligible Certificateholder.
(c) The Certificate Administrator or the Trustee, as applicable, shall,
on behalf of the Depositor and in respect of the Trust Fund, prepare, sign and
cause to be filed with the Commission any periodic reports required to be filed
under the provisions of the Exchange Act, and the rules and regulations of the
Commission thereunder; provided, however, that any annual report of the
Depositor on Form 10-K shall be signed by AAMG on behalf of the Depositor and in
respect of the Trust Fund. In connection with the preparation and filing of such
periodic reports, the Depositor and the Servicers shall timely provide to the
Trustee or the Certificate Administrator, as the case may be, all material
information that is in the possession of the Depositor and the Servicers and is
not, to the best of the Depositor's or the related Servicer's knowledge, in the
possession of the Trustee or the Certificate Administrator and which is required
to be included in such reports. Neither the Trustee or the Certificate
Administrator, as applicable, nor the Servicers shall have any liability with
respect to the Trustee's or the Certificate Administrator's failure to properly
prepare or file such periodic reports resulting from or relating to the
Trustee's or the Certificate Administrator's inability or failure to obtain any
information not resulting from the Trustee's or the Certificate Administrator's
own negligence or willful misconduct. Prior to January 30 of the first year in
which the Certificate Administrator or the Trustee, as applicable, is able to do
so under applicable law, the Certificate Administrator or the Trustee shall file
a Form 15 Suspension Notification with respect to the Trust Fund. Any Form 10-K
that is filed with the Commission in connection with this clause (c) shall
include a certification, signed by the senior officer in charge of the servicing
functions of AAMG, in the form attached as Exhibit S hereto or such other form
as may be required or permitted by the Commission (the "Form 10-K
Certification"), in compliance with Rule 13a-14 and 15d-14 under the Exchange
Act and any additional directives of the Commission. In connection with the Form
10-K Certification, the Certificate Administrator or the Trustee, as applicable,
and WMMSC shall each provide AAMG with a back-up certification substantially in
the form attached hereto as Exhibit T in the case of the Certificate
Administrator or the Trustee and Exhibit U in the case of WMMSC (each, a
"Back-up Certification"). This Section 4.2(c) may be amended in accordance with
this Agreement without the consent of the Certificateholders.
WMMSC agrees to indemnify and hold harmless each of AAMG, the
Depositor, the Certificate Administrator and the Trustee and each Person, if
any, who "controls" AAMG, the Depositor, the Certificate Administrator or the
Trustee within the meaning of the 1933 Act and their respective officers and
directors against any and all losses, penalties, fines, forfeitures, legal fees
and related costs, judgments and any other costs, fees and expenses that such
Person may sustain arising out of third party claims based on (i) the failure of
WMMSC to deliver or cause to be delivered when
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required any related Back-up Certification required pursuant to this Section
4.2(c) or (ii) any material misstatement or omission contained in any related
Back-up Certification provided pursuant to this Section 4.2(c). If an event
occurs that would otherwise result in an indemnification obligation under
clauses (i) or (ii) above, but the indemnification provided for in this Section
4.2(c) by WMMSC is unavailable or insufficient to hold harmless such Persons,
then WMMSC 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 AAMG, the
Depositor, Certificate Administrator or Trustee on the one hand and WMMSC on the
other. WMMSC acknowledges that AAMG, the Depositor, the Certificate
Administrator and the Trustee are relying on WMMSC's performance of its
obligations under this Agreement in order to perform their respective
obligations under this Section 4.2(c).
The Certificate Administrator agrees to indemnify and hold harmless
each of the Depositor, the Trustee and the Servicers and each Person, if any,
who "controls" the Depositor, the Trustee and the Servicers within the meaning
of the 1933 Act and their respective officers and directors against any and all
losses, penalties, fines, forfeitures, legal fees and related costs, judgments
and any other costs, fees and expenses that such Person may sustain arising out
of third party claims based on (i) the failure of the Certificate Administrator
to deliver or cause to be delivered when required any related Back-up
Certification required pursuant to this Section 4.2(c) or (ii) any material
misstatement or omission contained in any related Back-up Certification provided
pursuant to this Section 4.2(c). If an event occurs that would otherwise result
in an indemnification obligation under clauses (i) or (ii) above, but the
indemnification provided for in this Section 4.2(c) by the Certificate
Administrator is unavailable or insufficient to hold harmless such Persons, then
the Certificate 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, Servicers or Trustee on the one hand and the Certificate
Administrator on the other. The Certificate Administrator acknowledges that the
Depositor, the Servicers and the Trustee are relying on the Certificate
Administrator's performance of its obligations under this Agreement in order to
perform their respective obligations under this Section 4.2(c).
Section 4.3 ADVANCES BY THE SERVICER; DISTRIBUTION REPORTS TO THE
TRUSTEE. To the extent described below, each Servicer is obligated to advance
its own funds to the Certificate Account to cover any shortfall between (i)
payments scheduled to be received in respect of Loans serviced by such Servicer,
and (ii) the amounts actually deposited in the Certificate Account on account of
such payments. Each Servicer's obligation to make any Advance or Advances
described in this Section 4.3 is effective only to the extent that such Advance
is, in the good faith judgment of the related Servicer, reimbursable from
Insurance Proceeds or Liquidation Proceeds of the related Loans or recoverable
as late Monthly Payments with respect to the related Loans or otherwise.
With respect to WMMSC, prior to the close of business on the second
Business Day following the 18th day of the month in which each Distribution Date
occurs, and with respect to AAMG, prior to the close of business on or before
each Determination Date, such Servicer shall determine whether or not it will
make an Advance on the next Withdrawal Date and shall furnish
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a statement to the Certificate Administrator, if any, the Trustee, the Paying
Agent, if any, and to any Certificateholder requesting the same, setting forth
the aggregate amount to be distributed on the next succeeding Distribution Date
on account of principal and interest in respect of the Loans, stated separately.
In the event that full scheduled amounts of principal and interest in respect of
the related Loans shall not have been received by or on behalf of the related
Servicer prior to the Withdrawal Date preceding such Distribution Date and the
related Servicer shall have determined that an Advance shall be made in
accordance with this Section 4.3, the related Servicer shall so specify and
shall specify the aggregate amount of such Advance.
In the event that a Servicer shall be required to make an Advance, it
shall on the Withdrawal Date either (i) deposit in the Certificate Account an
amount equal to such Advance, (ii) direct the Trustee or the Certificate
Administrator (if so appointed by the Trustee) to make an appropriate entry in
the records of the Certificate Account or such Servicer shall make an
appropriate entry in the records for the Custodial Account for P&I that funds in
such account being held for future distribution or withdrawal have been, as
permitted by this Section 4.3, used by such Servicer to make such Advance, or
(iii) make advances in the form of any combination of (i) and (ii) aggregating
the amount of such Advance. Any funds being held for future distribution to
Certificateholders and so used shall be replaced by the related Servicer by
deposit in the Certificate Account on any future Withdrawal Date to the extent
that funds in the Certificate Account on the related Distribution Date with
respect to the related Loans shall be less than payments to Certificateholders
required to be made on such date with respect to such Loans.
Each Servicer shall be entitled to reimbursement for any Advance as
provided in Section 3.3 of this Agreement.
In the event that the Trustee has appointed a Certificate
Administrator, prior to 5:00 P.M. New York City time on the Withdrawal Date, the
Certificate Administrator shall provide the Trustee with a statement regarding
the amount of principal and interest, the Residual Distribution Amount and the
Excess Liquidation Proceeds to be distributed to each Class of Certificates on
such Distribution Date (such amounts to be determined in accordance with the
definition of "Certificate Distribution Amount", Section 4.1 hereof and other
related definitions set forth in Article I hereof).
Section 4.4 NONRECOVERABLE ADVANCES. Any Advance previously made by or
on behalf of a Servicer with respect to a Loan that such Servicer shall
determine in its good faith judgment not to be ultimately recoverable from
Insurance Proceeds or Liquidation Proceeds or otherwise with respect to such
Loan or recoverable as late Monthly Payments with respect to such Loan shall be
a Nonrecoverable Advance. The determination by a Servicer that it has made a
Nonrecoverable Advance or that any advance would constitute a Nonrecoverable
Advance, shall be evidenced by an Officer's Certificate of such Servicer
delivered to the Trustee on the Determination Date and detailing the reasons for
such determination. Notwithstanding any other provision of this Agreement, any
insurance policy relating to the Loans, or any other agreement relating to the
Loans to which the Depositor or the related Servicer is a party, (a) the related
Servicer shall not be obligated to, and shall not, make any advance that, after
reasonable inquiry and in its sole discretion, it
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determines would be a Nonrecoverable Advance, and (b) the related Servicer shall
be entitled to reimbursement for any Nonrecoverable Advance as provided in
Section 3.3 of this Agreement.
Section 4.5 FORECLOSURE REPORTS. Each year beginning in 2004 each
Servicer shall make any reports of foreclosures and abandonments of any
Mortgaged Property required by Section 6050J of the Code. In order to facilitate
this reporting process, each Servicer, on or before February 28th of each year,
commencing with 2004, shall provide to the Internal Revenue Service, the Trustee
and the Certificate Administrator, if any, reports relating to each instance
occurring during the previous calendar year in which each Servicer (i) on behalf
of the Trustee acquires an interest in a Mortgaged Property through foreclosure
or other comparable conversion in full or partial satisfaction of a Loan, or
(ii) knows or has reason to know that a Mortgaged Property has been abandoned.
The reports from each Servicer shall be in form and substance sufficient to meet
the reporting requirements imposed by such Section 6050J.
Section 4.6 ADJUSTMENT OF SERVICING FEES WITH RESPECT TO PAYOFFS. The
aggregate amount of the Servicing Fee subject to retention from deposit into or
withdrawal from the Certificate Account by the related Servicer, in any month of
distribution shall be decreased by any Compensating Interest due and owing with
respect to any Loan with respect to which a Payoff has occurred in the related
Prepayment Period. The related Servicer shall include the amount of any such
Compensating Interest with the deposits into the Certificate Account on the
related Withdrawal Date. Notwithstanding the foregoing, the amount by which the
Servicing Fee may be reduced with respect to the related Prepayment Period
pursuant to this Section 4.6 shall not exceed an amount greater than the amount
described in clause (i) of the definition of Compensating Interest for all Loans
as to which Payoffs have occurred and the rights of the Certificateholders to
such portion of the Servicing Fee shall not be cumulative.
Section 4.7 PROHIBITED TRANSACTIONS TAXES AND OTHER TAXES.
(a) In the event that any tax (including a tax on "prohibited
transactions" as defined in Section 860F(a)(2) of the Code and including any and
all interest, penalties, fines and additions to tax, as well as any and all
reasonable counsel fees and out-of-pocket expenses incurred in contesting the
imposition of such tax) is imposed on the Trust Fund, and the primary cause of
such tax was a breach of such Servicer's duties under (x) Section 3.2 of this
Agreement to not make any modification, waiver or amendment of any Mortgage Loan
which would cause any REMIC created hereunder to fail to qualify as a REMIC or
result in the imposition of any tax under Section 860F(a) or Section 860G(d) of
the Code or (y) Section 3.7(c) of this Agreement to not cause any REO Property
to fail to qualify as "foreclosure property" within the meaning of Section
860G(a)(8) of the Code or to subject any REMIC created hereunder to the
imposition of any federal, state or local income taxes on the income earned from
such Mortgaged Property under Section 860G(c) of the Code or otherwise, then
such Servicer shall (A) pay such taxes when and as the same shall be due and
payable (but such obligation shall not prevent the related Servicer, the
Trustee, the Certificate Administrator, if any, or any other appropriate Person
from contesting any such tax in appropriate proceedings and shall not prevent
the related Servicer from withholding payment of such tax, if
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permitted by law, pending the outcome of such proceedings), and (B) indemnify
and hold harmless the Trust Fund from and against, such taxes imposed on the
Trust Fund to the extent not paid under clause (A).
(b) In the event that any tax is imposed on the Trust Fund and neither
Servicer is obligated to pay or indemnify the Trust Fund for such tax under
Section 4.7 (a), then the Trustee or Certificate Administrator shall pay such
tax, and the amount of such tax shall be first charged against amounts otherwise
distributable to the Holders of Component R-1 of the Class R Certificate (or, if
the tax relates to REMIC II, Component R-2 of the Class R Certificate or, if the
tax relates to REMIC III, Component R-3 of the Class R Certificate) on a pro
rata basis, then against amounts otherwise distributable with respect to the
REMIC I Regular Interests (or, if the tax relates to REMIC II, to the Holders of
the REMIC II Regular Interests) on a pro rata basis. The Trustee or the
Certificate Administrator is hereby authorized to retain from amounts otherwise
distributable to the Certificateholders sufficient funds for the payment of such
tax pursuant to this Section 4.7(b).
Section 4.8 TAX ADMINISTRATION.
(a) The Trustee is hereby appointed as attorney-in-fact and agent for
the initial Tax Matters Person; provided, that the Trustee may appoint, and
hereby does so appoint, the Certificate Administrator as attorney-in-fact and
agent for the Tax Matters Person. The Trustee may, by written notice delivered
to the Certificate Administrator, revoke the appointment of the Certificate
Administrator as attorney-in-fact and agent for the Tax Matters Person, in which
case the Trustee shall act in such capacity.
(b) In order to enable the Trustee or the Certificate Administrator, as
applicable, to perform its duties as set forth in this Section 4.8 and Section
3.1(b), AAMG agrees to provide any tax forms, instruments or other documents
related thereto, as the Trustee or the Certificate Administrator, as applicable,
may reasonably request, including, without limitation, any tax forms,
instruments or other documents prepared by AAMG pursuant to this Section 4.8. In
order to enable the Trustee or the Certificate Administrator, as applicable, to
perform its duties as set forth in this Section 4.8 and Section 3.1(b), each
Servicer shall use its best efforts to cause to be delivered to the Trustee or
the Certificate Administrator, as applicable, within ten (10) days after the
Closing Date all loan level information or data that the Trustee or the
Certificate Administrator, as applicable, determines to be relevant for tax
purposes to the valuations and offering prices of the Certificates, including,
without limitation, the price, yield, prepayment assumption and projected cash
flows. Thereafter, each Servicer shall use its best efforts to provide to the
Trustee or the Certificate Administrator, as applicable, promptly upon request
therefor, any such additional loan level information or data that the Trustee or
the Certificate Administrator, as applicable, may, from time to time, request in
order to enable the Trustee or the Certificate Administrator, as applicable, to
perform its duties as set forth in this Section 4.8 and Section 3.1(b).
Section 4.9 EQUAL STATUS OF SERVICING FEE. The right of the related
Servicer to receive its applicable Servicing Fee will be equal and not
subordinate to the right of the Certificateholders to
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receive principal and interest payments based on their interests as provided
herein. Each Servicer's Servicing Fee may be collected from Monthly Payments as
received pursuant to Section 3.2 without deposit into the Certificate Account,
whereas the Certificateholders' distributions shall be made on a delayed basis
as set forth in the terms of the Certificates.
Section 4.10 APPOINTMENT OF PAYING AGENT AND CERTIFICATE ADMINISTRATOR.
The Trustee may appoint an Eligible Institution to act as a paying agent (the
"Paying Agent") or a certificate administrator (the "Certificate
Administrator"), as the case may be, in order to delegate to such Eligible
Institution any of its duties under this Agreement to administer the issuance,
transfer and exchange of the Certificates, administer payments to
Certificateholders or prepare information related to the Certificates; provided,
that the Trustee shall remain primarily responsible for any duties so delegated;
provided, further, that the Trustee shall receive no additional compensation in
connection with such appointment and delegation.
Initially, LaSalle Bank National Association will be the Certificate
Administrator and Paying Agent. If LaSalle Bank National Association ceases to
serve as Certificate Administrator or Paying Agent, the Trustee shall send
written notice to all Certificateholders (i) indicating that LaSalle Bank
National Association is no longer in such capacity and (ii) setting forth its
replacement, if any, appointed pursuant to this Section 4.10.
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ARTICLE V
THE CERTIFICATES
Section 5.1 THE CERTIFICATES.
(a) The Certificates shall be substantially in the forms set forth in
Exhibits A and B attached hereto, and shall be executed by the Trustee,
authenticated by the Trustee (or any duly appointed Authenticating Agent) and
delivered to or upon the order of the Depositor upon receipt by the Trustee of
the documents specified in Section 2.1. The Certificates shall be issuable in
Authorized Denominations evidencing Percentage Interests. Certificates shall be
executed by manual or facsimile signature on behalf of the Trust Fund by
authorized officers of the Trustee. Certificates bearing the manual or facsimile
signatures of individuals who were at the time of execution the proper officers
of the Trustee shall bind the Trust Fund, notwithstanding that such individuals
or any of them have ceased to hold such offices prior to the authentication and
delivery of such Certificates or did not hold such offices at the date of such
Certificates. No Certificate shall be entitled to any benefit under this
Agreement, or be valid for any purpose, unless there appears on such Certificate
a certificate of authentication substantially in the form provided for herein
executed by the Trustee or any Authenticating Agent by manual signature, and
such certificate 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.
(b) The following definitions apply for purposes of this Section 5.1:
"Disqualified Organization" means any Person which is not a Permitted
Transferee, but does not include any "Pass-Through Entity" which owns or holds a
Residual Certificate and of which a Disqualified Organization, directly or
indirectly, may be a stockholder, partner or beneficiary; "Pass-Through Entity"
means any regulated investment company, real estate investment trust, common
trust fund, partnership, trust or estate, and any organization to which Section
1381 of the Code applies; "Ownership Interest" means, with respect to any
Residual Certificate, any ownership or security interest in such Residual
Certificate, including any interest in a Residual Certificate as the Holder
thereof and any other interest therein whether direct or indirect, legal or
beneficial, as owner or as pledgee; "Transfer" means any direct or indirect
transfer or sale of, or directly or indirectly transferring or selling, any
Ownership Interest in a Residual Certificate; and "Transferee" means any Person
who is acquiring by Transfer any Ownership Interest in a Residual Certificate.
(c) Restrictions on Transfers of the Residual Certificate to
Disqualified Organizations are set forth in this Section 5.1(c).
(i) Each Person who has or who acquires any Ownership Interest
in a Residual 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 authorized the
Trustee, the Certificate Administrator or the Paying Agent under clause
(iii)(A) below to deliver payments to a Person other than such Person
and to negotiate the terms of any
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mandatory sale under clause (iii)(B) below and to execute all
instruments of transfer and to do all other things necessary in
connection with any such sale. The rights of each Person acquiring any
Ownership Interest in a Residual Certificate are expressly subject to
the following provisions:
(1) Each Person holding or acquiring any Ownership
Interest in a Residual Certificate shall be a
Permitted Transferee and shall promptly notify the
Trustee or the Certificate Registrar if not the same
Person as the Trustee of any change or impending
change in its status as a Permitted Transferee.
(2) In connection with any proposed Transfer of any
Ownership Interest in a Residual Certificate to a
U.S. Person, the Trustee or the Certificate Registrar
if not the same Person as the Trustee shall require
delivery to it, and shall not register the Transfer
of any Residual Certificate until its receipt of (1)
an affidavit and agreement (a "Transferee Affidavit
and Agreement") attached hereto as Exhibit J from the
proposed Transferee, in form and substance
satisfactory to the Depositor, representing and
warranting, among other things, that it is not a
Non-U.S. Person, that such transferee is a Permitted
Transferee, that it is not acquiring its Ownership
Interest in the Residual Certificate that is the
subject of the proposed Transfer as a nominee,
trustee or agent for any Person who is not a
Permitted Transferee, that for so long as it retains
its Ownership Interest in a Residual Certificate, it
will endeavor to remain a Permitted Transferee, and
that it has reviewed the provisions of this Section
5.1(c) and agrees to be bound by them, and (2) a
certificate, attached hereto as Exhibit I, from the
Holder wishing to transfer the Residual Certificate,
in form and substance satisfactory to the Depositor,
representing and warranting, among other things, that
no purpose of the proposed Transfer is to allow such
Holder to impede the assessment or collection of tax.
(3) Notwithstanding the delivery of a Transferee
Affidavit and Agreement by a proposed Transferee
under clause (B) above, if the Trustee or the
Certificate Registrar if not the same Person as the
Trustee has actual knowledge that the proposed
Transferee is not a Permitted Transferee, no Transfer
of an Ownership Interest in a Residual Certificate to
such proposed Transferee shall be effected.
(4) Each Person holding or acquiring any Ownership
Interest in a Residual Certificate agrees by holding
or acquiring such Ownership Interest (i) to require a
Transferee Affidavit and Agreement from any other
Person to whom such Person attempts to transfer its
Ownership Interest and to provide a certificate to
the Trustee or the Certificate Registrar if not the
same Person as the Trustee in the form attached
hereto as Exhibit J; (ii) to obtain the express
written consent of the Depositor prior to any
transfer of such
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Ownership Interest, which consent may be withheld in
the Depositor's sole discretion; and (iii) to provide
a certificate to the Trustee or the Certificate
Registrar if not the same Person as the Trustee in
the form attached hereto as Exhibit I.
(ii) The Trustee or the Certificate Registrar if not the same
Person as the Trustee shall register the Transfer of any Residual
Certificate only if it shall have received the Transferee Affidavit and
Agreement, a certificate of the Holder requesting such transfer in the
form attached hereto as Exhibit J and all of such other documents as
shall have been reasonably required by the Trustee or the Certificate
Registrar if not the same Person as the Trustee as a condition to such
registration.
(iii) (A) If any Disqualified Organization shall become a
Holder of a Residual Certificate, then the last preceding Permitted
Transferee shall be restored, to the extent permitted by law, to all
rights and obligations as Holder thereof retroactive to the date of
registration of such Transfer of such Residual Certificate. If any
Non-U.S. Person shall become a Holder of a Residual Certificate, then
the last preceding Holder which is a U.S. Person shall be restored, to
the extent permitted by law, to all rights and obligations as Holder
thereof retroactive to the date of registration of the Transfer to such
Non-U.S. Person of such Residual Certificate. If a transfer of a
Residual Certificate is disregarded pursuant to the provisions of
Treasury Regulations Section 1.860E-1 or Section 1.860G-3, then the
last preceding Permitted Transferee shall be restored, to the extent
permitted by law, to all rights and obligations as Holder thereof
retroactive to the date of registration of such Transfer of such
Residual Certificate. The Trustee, any Servicer, the Certificate
Administrator, the Certificate Registrar and the Paying Agent shall be
under no liability to any Person for any registration of Transfer of a
Residual Certificate that is in fact not permitted by this Section
5.1(c) or for making any payments due on such Certificate to the Holder
thereof or for taking any other action with respect to such Holder
under the provisions of this Agreement.
(B) If any purported Transferee shall become a Holder
of the Residual Certificate in violation of the restrictions
in this Section 5.1(c) and to the extent that the retroactive
restoration of the rights of the Holder of such Residual
Certificate as described in clause (iii)(A) above shall be
invalid, illegal or unenforceable, then the Depositor shall
have the right, without notice to the Holder or any prior
Holder of such Residual Certificate, to sell such Residual
Certificate to a purchaser selected by the Depositor on such
terms as the Depositor may choose. Such purported Transferee
shall promptly endorse and deliver the Residual Certificate in
accordance with the instructions of the Depositor. Such
purchaser may be the Depositor itself or any affiliate of the
Depositor. The proceeds of such sale, net of the commissions
(which may include commissions payable to the Depositor or its
affiliates), expenses and taxes due, if any, shall be remitted
by the Depositor to such purported Transferee. The terms and
conditions of any sale under this clause (iii)(B) shall be
determined in the sole discretion of the Depositor, and the
Depositor shall not be liable to any
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Person having an Ownership Interest in the Residual
Certificate as a result of its exercise of such discretion.
(iv) The Depositor, on behalf of the Trustee, shall make
available, upon written request from the Trustee, or the Certificate
Administrator all information necessary to compute any tax imposed (A)
as a result of the Transfer of an Ownership Interest in the Residual
Certificate to any Person who is not a Permitted Transferee, including
the information regarding "excess inclusions" of such Residual
Certificate required to be provided to the Internal Revenue Service and
certain Persons as described in Treasury Regulation Section
1.860D-1(b)(5), and (B) as a result of any regulated investment
company, real estate investment trust, common trust fund, partnership,
trust, estate or organizations described in Section 1381 of the Code
having as among its record holders at any time any Person who is not a
Permitted Transferee. Reasonable compensation for providing such
information may be required by the Depositor from such Person.
(v) The provisions of this Section 5.1 set forth prior to this
Section 5.1(c)(v) may be modified, added to or eliminated, provided,
that there shall have been delivered to the Trustee and the Certificate
Administrator the following:
(1) written notification from each Rating Agency to the
effect that the modification, addition to or
elimination of such provisions will not cause such
Rating Agency to downgrade its then-current Ratings
of the Certificates; and
(2) an Opinion of Counsel, in form and substance
satisfactory to the Depositor (as evidenced by a
certificate of the Depositor), to the effect that
such modification, addition to or absence of such
provisions will not cause the Trust Fund to cease to
qualify as a REMIC and will not create a risk that
(1) the Trust Fund may be subject to an entity-level
tax caused by the Transfer of any Residual
Certificate to a Person which is not a Permitted
Transferee or (2) a Certificateholder or another
Person will be subject to a REMIC-related tax caused
by the Transfer of a Residual Certificate to a Person
which is not a Permitted Transferee.
(vi) The following legend shall appear on all Residual
Certificates:
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS
CERTIFICATE MAY BE MADE ONLY IF THE PROPOSED
TRANSFEREE PROVIDES A TRANSFEREE AFFIDAVIT AND
AGREEMENT TO THE DEPOSITOR, THE TRUSTEE AND THE
CERTIFICATE REGISTRAR THAT (1) SUCH TRANSFEREE IS
NOT EITHER (A) THE UNITED STATES, ANY STATE OR
POLITICAL SUBDIVISION THEREOF, ANY FOREIGN
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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 ENABLE THE TRANSFEROR
TO IMPEDE THE ASSESSMENT OR COLLECTION OF TAX. SUCH
AFFIDAVIT SHALL INCLUDE CERTAIN REPRESENTATIONS AS
TO THE FINANCIAL CONDITION OF THE PROPOSED
TRANSFEREE. NOTWITHSTANDING THE REGISTRATION IN THE
CERTIFICATE REGISTER OF 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.
(vii) The Holder of the Class R Certificate issued hereunder,
while not a Disqualified Organization, is the Tax Matters Person.
(d) (i) No purchase or transfer of a Senior Certificate or a Senior
Subordinate Certificate or any interest therein shall be made by or to any
"employee benefit plan" subject to ERISA or any "plan" described by Section
4975(e)(1) of the Code, or any entity deemed to hold plan assets of any of the
foregoing by reason of a plan's investment in such entity (each, a "Plan")
unless (A) in the case of any such Class of Certificates (other than the Class R
Certificate), such Plan qualifies as an accredited investor as defined in Rule
501(a)(1) of Regulation D under the Securities Act and either (1) at the time of
such transfer, the Certificates are rated in one of the top four rating
categories by at least one Rating Agency, or (2) the purchaser is an insurance
company general account that is eligible for, and satisfies all of the
requirements of, Sections I and III of Prohibited Transaction Class
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Exemption 95-60 ("PTCE 95-60") and (B) in the case of a Class R Certificate, the
Trustee receives an Opinion of Counsel acceptable to and in form and substance
satisfactory to and on which the Trustee, the Depositor, the Certificate
Registrar, the Certificate Administrator, if any, and the Servicers may rely, to
the effect that the purchase or holding of such Class R Certificate is
permissible under applicable law, will not constitute or result in any
non-exempt prohibited transaction under Section 406 of ERISA, or Section 4975 of
the Code (or comparable provisions of any subsequent enactments), and will not
subject the Trustee, the Certificate Registrar, the Certificate Administrator,
if any, the Depositor or the Servicers to any obligation or liability (including
obligations or liabilities under ERISA or Section 4975 of the Code) in addition
to those undertaken in this Agreement, which Opinion of Counsel shall not be an
expense of the Trustee, the Certificate Registrar, the Certificate
Administrator, if any, the Depositor or the Servicers. Each Person who acquires
a Senior Certificate or a Senior Subordinate Certificate shall be deemed to
certify that it meets the foregoing conditions, and that it will not transfer
such Certificate in violation of the foregoing.
(ii) No purchase or transfer of a Junior Subordinate Certificate shall
be made by or to a Plan unless such purchaser or transferee is an "insurance
company general account" (within the meaning of PTCE 95-60) and is eligible for,
and satisfies all of the requirements for exemptive relief under Sections I and
III of PTCE 95-60. Each Person who acquires a Junior Subordinate Certificate or
any interest therein shall be deemed to certify and shall be required by the
Certificate Registrar to provide an Officer's Certificate (substantially in the
form of Exhibit L attached hereto) signed by a Responsible Officer of such
Person, which Officer's Certificate shall not be an expense of any Servicer, the
Trustee, the Certificate Administrator, if any, the Certificate Registrar or the
Depositor) that it meets the foregoing conditions, and that it will not transfer
such Certificate in violation of the foregoing.
(e) No transfer, sale, pledge or other disposition of a Junior
Subordinate Certificate shall be made unless such transfer, sale, pledge or
other disposition is made in accordance with this Section 5.1(e) or Section
5.1(f). Each Person who, at any time, acquires any ownership interest in any
Junior Subordinate Certificate shall be deemed by the acceptance or acquisition
of such ownership interest to have agreed to be bound by the following
provisions of this Section 5.1(e) and Section 5.1(f), as applicable. No transfer
of a Junior Subordinate Certificate shall be deemed to be made in accordance
with this Section 5.1(e) unless such transfer is made pursuant to an effective
registration statement under the Securities Act or unless the Trustee or the
Certificate Registrar, if not the same Person as the Trustee, is provided with
the certificates and an Opinion of Counsel, if required, on which the Trustee
and the Certificate Registrar may conclusively rely, which establishes or
establish to the Trustee's or the Certificate Registrar's, as applicable,
satisfaction that such transfer is exempt from the registration requirements
under the Securities Act, as follows: In the event that a transfer is to be made
in reliance upon an exemption from the Securities Act, the Trustee or the
Certificate Registrar, if not the same Person as the Trustee, shall require, in
order to assure compliance with the Securities Act, that the Certificateholder
desiring to effect such transfer certify to the Trustee and the Certificate
Registrar in writing, in substantially the form attached hereto as Exhibit F,
the facts surrounding the transfer, with such modifications to such Exhibit F as
may be
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appropriate to reflect the actual facts of the proposed transfer, and that the
Certificateholder's proposed transferee certify to the Trustee and the
Certificate Registrar in writing, in substantially the form attached hereto as
Exhibit G, the facts surrounding the transfer, with such modifications to such
Exhibit G as may be appropriate to reflect the actual facts of the proposed
transfer. If such certificate of the proposed transferee does not contain
substantially the substance of Exhibit G, the Trustee or the Certificate
Registrar, if not the same Person as the Trustee, shall require an Opinion of
Counsel satisfactory to it that such transfer may be made without registration,
which Opinion of Counsel shall not be obtained at the expense of the Trustee,
any Servicer, the Certificate Administrator, the Certificate Registrar, the
Trust Fund or the Depositor. Such Opinion of Counsel shall allow for the
forwarding, and the Trustee shall forward, a copy thereof to each Rating Agency.
Notwithstanding the foregoing, any Class of Junior Subordinate Certificates may
be transferred, sold, pledged or otherwise disposed of in accordance with the
requirements set forth in Section 5.1(f).
(f) Transfers of the Junior Subordinate Certificates may be made in
accordance with this Section 5.1(f). To effectuate a Certificate transfer in
accordance with this Section 5.1(f), the proposed transferee of such Certificate
must provide the Trustee, the Certificate Registrar and the Depositor with an
investment letter substantially in the form of Exhibit L attached hereto, which
investment letter shall not be an expense of the Trustee, any Servicer, the
Certificate Administrator, the Certificate Registrar or the Depositor, and which
investment letter states that, among other things, such transferee (i) is a
"qualified institutional buyer" as defined under Rule 144A, acting for its own
account or the accounts of other "qualified institutional buyers" as defined
under Rule 144A, and (ii) is aware that the proposed transferor intends to rely
on the exemption from registration requirements under the Securities Act
provided by Rule 144A. Notwithstanding the foregoing, the proposed transferee of
such Certificate shall not be required to provide the Trustee, the Certificate
Registrar or the Depositor with Annex 1 or Annex 2 to the form of Exhibit L
attached hereto if the Depositor so consents prior to each such transfer. Such
transfers shall be deemed to have complied with the requirements of this Section
5.1(f). The Holder of a Certificate desiring to effect such transfer does hereby
agree to indemnify the Trustee, any Servicer, the Certificate Administrator, if
any, the Depositor, and the Certificate Registrar against any liability that may
result if transfer is not made in accordance with this Agreement.
(g) None of the Trustee, any Servicer, the Certificate Administrator,
the Certificate Registrar or the Paying Agent shall have any liability to the
Trust Fund arising from a registration or transfer of a Certificate in reliance
upon a certification, Officer's Certificate, affidavit, ruling or Opinion of
Counsel described in this Section 5.1.
Section 5.2 CERTIFICATES ISSUABLE IN CLASSES; DISTRIBUTIONS OF
PRINCIPAL AND INTEREST; AUTHORIZED DENOMINATIONS. The aggregate principal amount
of Certificates that may be authenticated and delivered under this Agreement is
limited to the aggregate Principal Balance of the Loans as of the Cut-Off Date,
as specified in the Preliminary Statement to this Agreement, except for
Certificates authenticated and delivered upon registration of transfer of, or in
exchange for, or in lieu of, other Certificates pursuant to Section 5.3. Such
aggregate principal amount shall be allocated among one or more Classes having
designations, types of interests, initial per annum
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Remittance Rates, initial Class Principal Balances and last scheduled
Distribution Dates as specified in the Preliminary Statement to this Agreement.
The aggregate Percentage Interest of each Class of Certificates of which the
Class Principal Balance equals zero as of the Cut-Off Date that may be
authenticated and delivered under this Agreement is limited to 100%.
Certificates shall be issued in Authorized Denominations.
Section 5.3 REGISTRATION OF TRANSFER AND EXCHANGE OF CERTIFICATES. The
Trustee shall cause to be maintained at one of its offices or at its designated
Certificate Registrar, a Certificate Register in which there shall be recorded
the name and address of each Certificateholder. Subject to such reasonable rules
and regulations as the Trustee may prescribe, the Certificate Register shall be
amended from time to time by the Trustee or its agent to reflect notice of any
changes received by the Trustee or its agent pursuant to Section 10.5. The
Trustee may appoint an Eligible Institution to act as its agent in order to
delegate to such Eligible Institution its duties as Certificate Registrar under
this Agreement. The Trustee hereby appoints LaSalle Bank National Association as
the initial Certificate Registrar.
Upon surrender for registration of transfer of any Certificate to the
Trustee at the office of First Trust of New York, National Association, 000 Xxxx
Xxxxxx, Xxxxx 0000, Xxx Xxxx, Xxx Xxxx 00000, or such other address or agency as
may hereafter be provided to the Certificate Administrator, if any, and the
related Servicer in writing by the Trustee, the Trustee shall execute, and the
Trustee (or any Authenticating Agent) shall authenticate and deliver, in the
name of the designated transferee or transferees, one or more new Certificates
of Authorized Denominations of like Percentage Interest. At the option of the
Certificateholders, Certificates may be exchanged for other Certificates in
Authorized Denominations of like Percentage Interest, upon surrender of the
Certificates to be exchanged at any such office or agency. Whenever any
Certificates are so surrendered for exchange, the Trustee shall execute, and the
Trustee, or any Authenticating Agent, shall authenticate and deliver, the
Certificates which the Certificateholder making the exchange is entitled to
receive. Every Certificate presented or surrendered for transfer shall (if so
required by the Trustee or any Authenticating Agent) be duly endorsed by, or be
accompanied by a written instrument of transfer in form satisfactory to the
Trustee or any Authenticating Agent and duly executed by, the Holder thereof or
such Holder's attorney duly authorized in writing.
A reasonable service charge may be made for any such exchange or
transfer of Certificates, and the Trustee or an Authenticating Agent may require
payment of a sum sufficient to cover any tax or governmental charge that may be
imposed in connection with any exchange or transfer of Certificates.
All Certificates surrendered for exchange or transfer shall be canceled
by the Trustee or any Authenticating Agent.
Section 5.4 MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES. If (i)
any mutilated Certificate is surrendered to the Trustee or any Authenticating
Agent, or (ii) the Trustee or any Authenticating Agent receives evidence to
their satisfaction of the destruction, loss or theft of any
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Certificate, and there is delivered to the Trustee or any Authenticating Agent
such security or indemnity as may be required by them to save each of them
harmless, then, in the absence of notice to the Trustee or any Authenticating
Agent that such Certificate has been acquired by a bona fide purchaser, the
Trustee shall execute and the Trustee or any Authenticating Agent shall
authenticate and deliver, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Certificate, a new Certificate of like Percentage
Interest. Upon the issuance of any new Certificate under this Section 5.4, the
Trustee or any Authenticating Agent may require the payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in relation
thereto and any other expenses (including the fees and expenses of the Trustee
or any Authenticating Agent) connected therewith. Any replacement Certificate
issued pursuant to this Section 5.4 shall constitute complete and indefeasible
evidence of ownership in the Trust Fund, as if originally issued, whether or not
the lost or stolen Certificate shall be found at any time.
Section 5.5 PERSONS DEEMED OWNERS. The Depositor, the Certificate
Administrator, the Servicers, the Trustee, and any agent of any of them may
treat the Person in whose name any Certificate is registered as the owner of
such Certificate for the purpose of receiving distributions pursuant to Section
4.1 and for all other purposes whatsoever, and neither the Depositor, the
Certificate Administrator, if any, the Servicers, the Trustee, the Certificate
Registrar, nor any agent of the Depositor, the Certificate Administrator, if
any, the Servicers or the Trustee shall be affected by notice to the contrary.
Section 5.6 TEMPORARY CERTIFICATES. Upon the initial issuance of the
Certificates, the Trustee may execute, and the Trustee or any Authenticating
Agent shall authenticate and deliver, temporary Certificates which are printed,
lithographed, typewritten or otherwise produced, in any Authorized Denomination,
of the tenor of the definitive Certificates in lieu of which they are issued and
with such variations in form from the forms of the Certificates set forth as
Exhibits A and B hereto as the Trustee's or Authenticating Agent's officers
executing such Certificates may determine, as evidenced by their execution of
the Certificates. Notwithstanding the foregoing, the Certificates may remain in
the form set forth in this Section.
If temporary Certificates are issued, the Trustee shall cause
definitive Certificates to be prepared within ten Business Days of the Closing
Date or as soon as practicable thereafter. After preparation of definitive
Certificates, the temporary Certificates shall be exchangeable for definitive
Certificates upon surrender of the temporary Certificates at the office or
agency of the Trustee to be maintained as provided in Section 5.10 hereof,
without charge to the Holder. Any tax or governmental charge that may be imposed
in connection with any such exchange shall be borne by the Depositor. Upon
surrender for cancellation of any one or more temporary Certificates, the
Trustee shall execute and the Trustee or any Authenticating Agent shall
authenticate and deliver in exchange therefor a like principal amount of
definitive Certificates of Authorized Denominations. Until so exchanged, the
temporary Certificates shall in all respects be entitled to the same benefits
under this Agreement as definitive Certificates.
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Section 5.7 BOOK-ENTRY FOR BOOK-ENTRY CERTIFICATES. Notwithstanding the
foregoing, the Book-Entry Certificates, upon original issuance, shall be issued
in the form of one or more typewritten Certificates of Authorized Denomination
representing the Book-Entry Certificates, to be delivered to DTC, the initial
Clearing Agency, by, or on behalf of, the Depositor. The Book-Entry Certificates
shall initially be registered on the Certificate Register in the name of Cede &
Co., the nominee of DTC, as the initial Clearing Agency, and no Beneficial
Holder shall receive a definitive certificate representing such Beneficial
Holder's interest in any Class of Book-Entry Certificate, except as provided
above and in Section 5.9. Each Book-Entry Certificate shall bear the following
legend:
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
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.
Unless and until definitive, fully registered Book-Entry Certificates (the
"Definitive Certificates") have been issued to the Beneficial Holders pursuant
to Section 5.9:
(a) the provisions of this Section 5.7 shall be in full force and
effect with respect to the Book-Entry Certificates;
(b) the Certificate Administrator, if any, and the Trustee may deal
with the Clearing Agency for all purposes with respect to the Book-Entry
Certificates (including the making of distributions on the Book-Entry
Certificates) as the sole Certificateholder;
(c) to the extent that the provisions of this Section 5.7 conflict with
any other provisions of this Agreement, the provisions of this Section 5.7 shall
control; and
(d) the rights of the Beneficial Holders shall be exercised only
through the Clearing Agency and the DTC Participants and shall be limited to
those established by law and agreements between such Beneficial Holders and the
Clearing Agency and/or the DTC Participants. Pursuant to the Depositary
Agreement, unless and until Definitive Certificates are issued pursuant to
Section 5.9, the initial Clearing Agency will make book-entry transfers among
the DTC Participants and receive and transmit distributions of principal and
interest on the related Class of Book-Entry Certificates to such DTC
Participants.
For purposes of any provision of this Agreement requiring or permitting
actions with the consent of, or at the direction of, Holders of Book-Entry
Certificates evidencing a specified
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Percentage Interest, such direction or consent may be given by the Clearing
Agency at the direction of Beneficial Holders owning Book-Entry Certificates
evidencing the requisite Percentage Interest represented by the Book-Entry
Certificates. The Clearing Agency may take conflicting actions with respect to
the Book-Entry Certificates to the extent that such actions are taken on behalf
of the Beneficial Holders.
Section 5.8 NOTICES TO CLEARING AGENCY. Whenever notice or other
communication to the Certificateholders is required under this Agreement, unless
and until Definitive Certificates shall have been issued to the related
Certificateholders pursuant to Section 5.9, the Trustee shall give all such
notices and communications specified herein to be given to Holders of the
Book-Entry Certificates to the Clearing Agency which shall give such notices and
communications to the related DTC Participants in accordance with its applicable
rules, regulations and procedures.
Section 5.9 DEFINITIVE CERTIFICATES. If (a) the Clearing Agency
notifies the Certificate Administrator, if any, or the Trustee that it is no
longer willing or able to discharge properly its responsibilities under the
Depositary Agreement with respect to the Book-Entry Certificates and the Trustee
or the Certificate Administrator is unable to locate a qualified successor, (b)
the Depositor, at its option, advises the Certificate Administrator, if any, or
the Trustee in writing that it elects to terminate the book-entry system with
respect to the Book-Entry Certificates through the Clearing Agency or (c) after
the occurrence of an Event of Default, Certificateholders holding Book-Entry
Certificates evidencing Percentage Interests aggregating not less than 66% of
the aggregate Class Principal Balance of such Certificates advise the
Certificate Administrator, if any, or the Trustee and the Clearing Agency
through DTC Participants in writing that the continuation of a book-entry system
with respect to the Book-Entry Certificates through the Clearing Agency is no
longer in the best interests of the Certificateholders with respect to such
Certificates, the Trustee shall notify or cause to be notified all
Certificateholders of Book-Entry Certificates of the occurrence of any such
event and of the availability of Definitive Certificates. Upon surrender to the
Trustee of the Book-Entry Certificates by the Clearing Agency, accompanied by
registration instructions from the Clearing Agency for registration, the Trustee
shall execute and the Trustee or any Authenticating Agent shall authenticate and
deliver the Definitive Certificates. Neither the Depositor, the Certificate
Administrator, if any, the Authenticating Agent nor the Trustee shall be liable
for any delay in delivery of such instructions and may conclusively rely on, and
shall be protected in relying on, such instructions. Upon the issuance of
Definitive Certificates for all of the Certificates all references herein to
obligations imposed upon or to be performed by the Clearing Agency shall be
deemed to be imposed upon and performed by the Trustee, the Certificate
Administrator, if any, and the Trustee, the Certificate Administrator, the
Certificate Registrar and the Paying Agent shall recognize the Holders of
Definitive Certificates as Certificateholders hereunder.
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ARTICLE VI
THE DEPOSITOR AND THE SERVICERS
Section 6.1 LIABILITY OF THE DEPOSITOR AND THE SERVICERS. The Depositor
and the Servicers shall each be liable in accordance herewith only to the extent
of the obligations specifically imposed by this Agreement and undertaken
hereunder by the Depositor and the related Servicer herein.
Section 6.2 MERGER OR CONSOLIDATION OF THE DEPOSITOR OR THE SERVICERS.
Subject to the following paragraph, the Depositor and the Servicers each will
keep in full effect its existence, rights and franchises as corporations, each
under the laws of the jurisdiction of its incorporation, and will obtain and
preserve its qualification to do business as a foreign corporation in each
jurisdiction in which such qualification is or shall be necessary to protect the
validity and enforceability of this Agreement, the Certificates or any of the
Loans and to perform its respective duties under this Agreement.
The Depositor or each Servicer may be merged or consolidated with or
into any Person, or transfer all or substantially all of its assets to any
Person, in which case any Person resulting from any merger or consolidation to
which the Depositor or the related Servicer shall be a party, or any Person
succeeding to the business of the Depositor or the related Servicer, shall be
the successor of the Depositor or the related Servicer hereunder, without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, anything herein to the contrary notwithstanding; provided,
however, that the successor or surviving Person to the related Servicer to the
extent the related Servicer has any obligations to service the Loans hereunder
(and it has not assigned such obligations pursuant to Section 3.1(c)), the Loans
shall be serviced by a FNMA approved lender or a FHLMC seller/servicer in good
standing; and provided further that the then-current rating of the Class A
Certificates will not be reduced as a result of such merger or consolidation.
Section 6.3 LIMITATION ON LIABILITY OF THE SERVICERS AND OTHERS.
Neither the Servicers nor any of the directors, officers, employees or agents of
the Servicers 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 any director, officer,
employee or agent of the related Servicer against any liability which would
otherwise be imposed by reason of willful misfeasance, bad faith or gross
negligence in the performance of duties or by reason of reckless disregard of
obligations and duties hereunder. Each Servicer and any director, officer,
employee or agent of such 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. Each Servicer and any director, officer, employee or
agent of such Servicer shall be indemnified by the Trust Fund 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, in the case of the related Servicer and any director,
officer, employee or agent of the related Servicer, incurred by reason of
willful misfeasance, bad faith or gross negligence in the performance of duties
hereunder or by reason of reckless disregard of
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obligations and duties hereunder. Each Servicer shall not be under any
obligation to appear in, prosecute or defend any legal action which is not
incidental to its duties to service the Loans in accordance with this Agreement
and which in its opinion may involve it in any expense or liability; provided,
however, that the related Servicer may in its discretion 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 legal expenses and costs of
such action and any liability resulting therefrom shall be expenses, costs and
liabilities of the Trust Fund, and the related Servicer shall be entitled to be
reimbursed therefor out of the Custodial Account for P&I as provided by Section
3.3.
Section 6.4 SERVICERS NOT TO RESIGN. Each Servicer agrees not to resign
from the obligations and duties hereby imposed on it, except upon determination
that its 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, the other activities of the related Servicer so causing such a
conflict being of a type and nature carried on by the related Servicer at the
date of this Agreement. Any such determination permitting the resignation of a
Servicer shall be evidenced by an Opinion of Counsel to such effect delivered to
the Trustee. The related Servicer shall notify each Rating Agency of any such
resignation. No such resignation shall become effective until a successor
servicer shall have assumed the related Servicer's responsibilities and
obligations in accordance with Section 7.5 hereof.
Notwithstanding the limitations stated above, each Servicer may
transfer its obligations, duties and rights hereunder without the consent of the
Certificateholders, provided, that (i) the related Servicer obtains the prior
written consent of each Rating Agency, (ii) the transferee is a FNMA or
FHLMC-approved servicer having a net worth of not less than $15,000,000, (iii)
the successor servicer assumes all of the related Servicer's responsibilities
and obligations in accordance with Section 7.5 hereof, (iv) the then-current
rating of the Class A Certificates will not be reduced as a result of such
transfer, and (v) the successor servicer has, in the reasonable opinion of the
Trustee, the qualifications, resources and experience to properly carry out,
observe and perform the duties, obligations and responsibilities of the related
Servicer hereunder; provided, that the foregoing clause (v) is intended solely
for the benefit of (and may be exercised or waived at the sole discretion of)
the Trustee, to enable the Trustee to assure itself that any successor Servicer
has such acceptable qualifications, resources and experience, and such clause
(v) is not intended to be for the benefit of, and shall not be relied upon or
enforced by, any Certificateholder, and provided, further, that any consent to
such transfer will not be unreasonably withheld by the Trustee. The foregoing
shall not limit the ability of each Servicer to enter into sub-servicing
agreements with third parties.
Section 6.5 TRUSTEE ACCESS.
Each Servicer shall afford the Depositor and the Trustee, upon
reasonable notice, during normal business hours access to all records maintained
by the related Servicer, in respect of its rights and obligations hereunder and
access to such of its officers as are responsible for such obligations. Upon
reasonable request, the related Servicer, shall furnish the Depositor and the
Trustee with its
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most recent financial statements (or, for so long as WMMSC is a Servicer
hereunder, the most recent consolidated financial statements of Washington
Mutual, Inc., or the entity with whose financial statements the financial
statements of WMMSC are consolidated) and such other information as it
possesses, and which it is not prohibited by law or, to the extent applicable,
binding obligations to third parties with respect to confidentiality from
disclosing, regarding its business, affairs, property and condition, financial
or otherwise.
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ARTICLE VII
DEFAULT
Section 7.1 EVENTS OF DEFAULT. In case one or more of the following
Events of Default by the related Servicer shall occur and be continuing, that is
to say:
(i) any failure by such Servicer to distribute or cause to be
distributed to the Trustee or its delegate on the Withdrawal Date any
payment required to be made to the Trustee under the terms of this
Agreement which continues unremedied for a period of five days after
the date upon which written notice of such failure, requiring the same
to be remedied, shall have been given to such Servicer by the Trustee
or to such Servicer and the Trustee by the Holders of Certificates
evidencing Percentage Interests aggregating not less than 25% of the
Trust Fund or 51% of the aggregate Percentage Interests of any Class of
Certificates;
(ii) any failure on the part of such Servicer duly to observe
or perform in any material respect any other of the covenants or
agreements on the part of such Servicer in the Certificates or in this
Agreement which continues unremedied for a period of 60 days after the
date on which written notice of such failure, requiring the same to be
remedied, shall have been given to such Servicer by the Trustee, or to
such Servicer and the Trustee by the Holders of Certificates
evidencing, in aggregate, not less than 25% of the Trust Fund or 51% of
the aggregate Percentage Interests of any Class of Certificates;
(iii) a decree or order of a court or agency or supervisory
authority having jurisdiction in the premises for the appointment of a
conservator or receiver or liquidator in any insolvency, readjustment
of debt, marshaling of assets and liabilities or similar proceedings,
or for the winding-up or liquidation of its affairs, shall have been
entered against the related Servicer and such decree or order shall
have remained in force undischarged or unstayed for a period of 60
days;
(iv) such Servicer shall consent to the appointment of a
conservator or receiver or liquidator or liquidating committee in any
insolvency, readjustment of debt marshaling of assets and liabilities,
voluntary liquidation or similar proceedings of or relating to such
Servicer or of or relating to all or substantially all of its property;
(v) such 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
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(vi) any failure of such Servicer to make any Advance required
to be made from its own funds pursuant to Section 4.3 which continues
unremedied for a period of one Business Day after the date upon which
such Advance was to have been made;
then, if an Event of Default described in clauses (i)-(v) of this Section 7.1
shall occur, and in each and every such case, subject to applicable law, so long
as an Event of Default shall not have been remedied, either the Trustee or the
Holders of Certificates evidencing, in aggregate, not less than 25% of the Trust
Fund or 51% of the aggregate Percentage Interests of any Class of Certificates
by notice in writing to the related Servicer (and to the Trustee if given by the
Certificateholders) may terminate all of the rights and obligations of such
Servicer under this Agreement, but without prejudice to any rights it may have
to reimbursement of expenses, Advances and other advances of its own funds as a
Servicer to the extent permitted by this Agreement, other than the Depositor's
(or its successors') obligation to repurchase any Loans pursuant to Section 2.2
or 2.3 which shall survive any such termination. If an Event of Default
described in clause (vi) hereof shall occur, the Trustee shall, by notice in
writing to the related Servicer, which shall be telecopied to such Servicer,
immediately terminate all of the rights and obligations of such Servicer, under
this Agreement and in and to the Loans and the proceeds thereof. On or after the
receipt by such Servicer of such written notice, all authority and power of such
Servicer under this Agreement, whether with respect to the Certificates or the
Loans or otherwise, shall pass to and be vested in the Trustee pursuant to and
under this Section 7.1 (subject to the provisions of Section 7.5); and, without
limitation, the Trustee is hereby authorized and empowered to execute and
deliver, on behalf of such Servicer, as attorney-in-fact or otherwise, any and
all documents and other instruments, and to do or accomplish all other acts or
things necessary or appropriate to effect the purposes of such notice of
termination, whether to complete the transfer and endorsement or assignment of
the Loans and related documents or otherwise at the expense of such Servicer.
Each Servicer agrees to cooperate with the Trustee in effecting the termination
of such Servicer's responsibilities and rights hereunder and shall promptly
provide the Trustee all documents and records whether in written or electronic
form reasonably requested by it to enable it to assume the Servicer's functions
hereunder and shall promptly also transfer to the Trustee all amounts which then
have been or should have been deposited in the Custodial Account for P&I by the
related Servicer or which are thereafter received with respect to the Loans as
well as any escrowed funds held by it or in connection with its servicing
activities hereunder. The related Servicer and the Trustee shall give each
Rating Agency notice of any Event of Default. If a Servicer shall within two
Business Days following such suspension remit to the Trustee the amount of any
Advance the nonpayment of which by such Servicer was an Event of Default
described in clause (vi) of this Section 7.1, the Trustee, subject to the last
sentence of this paragraph, shall permit the related Servicer to resume its
rights and obligations as a Servicer hereunder. Each Servicer agrees that it
will reimburse the Trustee for actual, necessary and reasonable costs incurred
by the Trustee because of action taken pursuant to clause (vi) of this Section
7.1. Each Servicer agrees that if an Event of Default as described in clause
(vi) of this Section 7.1 shall occur more than two times in any twelve month
period, the Trustee shall be under no obligation to permit the related Servicer
to resume its rights and obligations as a Servicer hereunder.
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Section 7.2 OTHER REMEDIES OF TRUSTEE. During the continuance of any
Event of Default, so long as such Event of Default shall not have been remedied,
the Trustee, in addition to the rights specified in Section 7.1, shall have the
right, in its own name as trustee of an express trust, to take all actions now
or hereafter existing at law, in equity or by statute to enforce its rights and
remedies, and to protect the interests, and enforce the rights and remedies, of
the Certificateholders (including the institution and prosecution of all
judicial, administrative and other proceedings and the filing of proofs of claim
and debt in connection therewith). Except as otherwise expressly provided in
this Agreement, no remedy provided for by this Agreement shall be exclusive of
any other remedy, and each and every remedy shall be cumulative and in addition
to any other remedy and no delay or omission to exercise any right or remedy
shall impair any such right or remedy or shall be deemed to be a waiver of any
Event of Default.
Section 7.3 DIRECTIONS BY CERTIFICATEHOLDERS AND DUTIES OF TRUSTEE
DURING EVENT OF DEFAULT. During the continuance of any Event of Default, Holders
of Certificates evidencing, in aggregate, not less than 25% of the Trust Fund or
51% of the aggregate Percentage Interests of any Class of Certificates may
direct the time, method and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or power conferred upon the
Trustee under this Agreement; provided, however, that the Trustee shall be under
no obligation to pursue any such remedy, or to exercise any of the trusts or
powers vested in it by this Agreement (including, without limitation, (i) the
conducting or defending of any administrative action or litigation hereunder or
in relation hereto and (ii) the terminating of the related Servicer or any
successor servicer from its rights and duties as servicer hereunder) at the
request, order or direction of any of the Certificateholders, unless such
Certificateholders shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities which may be incurred
therein or thereby; and, provided, further, that, subject to the provisions of
Section 8.1, the Trustee shall have the right to decline to follow any such
direction if the Trustee, in accordance with an Opinion of Counsel, determines
that the action or proceeding so directed may not lawfully be taken or if the
Trustee in good faith determines that the action or proceeding so directed would
involve it in personal liability or be unjustly prejudicial to the non-assenting
Certificateholders or if the Trustee has received contrary directions pursuant
to this Section 7.3.
Section 7.4 ACTION UPON CERTAIN FAILURES OF A SERVICER AND UPON EVENT
OF DEFAULT. In the event that the Trustee shall have knowledge of any failure of
a Servicer specified in Section 7.1(i) or (ii) which would become an Event of
Default upon the related Servicer's failure to remedy the same after notice, the
Trustee shall give notice thereof to such Servicer. In the event that the
Trustee shall have knowledge of an Event of Default, the Trustee shall give
prompt written notice thereof to the Certificateholders and to each Rating
Agency. For all purposes of this Agreement, in the absence of actual knowledge
by a Responsible Officer of the Trustee, the Trustee shall not be deemed to have
knowledge of any failure of the related Servicer as specified in Section 7.1(i)
and (ii) or any Event of Default unless notified thereof in writing by the
related Servicer or by a Certificateholder.
Section 7.5 APPOINTMENT OF SUCCESSOR SERVICER.
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(a) When a Servicer receives a notice of termination pursuant to
Section 7.1 or the Trustee receives the resignation of a Servicer evidenced by
an Opinion of Counsel pursuant to Section 6.4, the Trustee shall become the
successor in all respects to the related Servicer in its capacity as a Servicer
under this Agreement and the transactions set forth or provided for herein,
provided, however, that the Trustee's obligation to make any Advances shall be
no greater than set forth in Section 4.3 of this Agreement, and the Trustee
shall have all the rights and powers and be subject to all the responsibilities,
duties and liabilities relating thereto placed on the related Servicer by the
terms and provisions hereof and in its capacity as such successor shall have the
same limitation of liability herein granted to such Servicer and provided,
further, that the Trustee shall not be required to make an Advance from its own
funds if such Advance would be prohibited by law. As compensation therefor, the
Trustee shall be entitled to receive monthly an amount not to exceed the
applicable Servicing Fee as agreed by the Trustee and the related Servicer,
together with such other servicing compensation in the form of assumption fees,
late charges, prepayment fees or otherwise provided in Section 3.9. If the
agreed amount is less than the applicable Servicing Fee, the excess shall be
paid to the Class R Certificateholder. If the Trustee and the related Servicer
shall not agree on the amount of such compensation, the Trustee shall solicit
bids for a successor servicer as described in Section 7.5(b), provided, however,
if no successor servicer is obtained through the bidding process, the Trustee
may act as such, or may pursuant to Section 7.5(b) appoint a successor servicer
to act as such, for the applicable Servicing Fee together with such other
servicing compensation as provided in Section 3.9. In no event shall the
Trustee's assumption of or succession to the obligations of the related Servicer
make the Trustee liable for any actions or omissions of such Servicer in its
capacity as a Servicer.
(b) Notwithstanding the above, the Trustee may and shall, if it is
unable (or unwilling due to disagreement on compensation as provided in Section
7.5 (a)) to act as a Servicer, appoint, or petition a court of competent
jurisdiction to appoint, any established housing and home finance institution,
bank or mortgage servicing institution which is an approved FNMA or FHLMC
servicer having a net worth of not less than $15,000,000 and meeting such other
standards as are set forth in Section 6.4 hereof for a successor to the
applicable Servicer hereunder in the assumption of all or any part of the
responsibilities, duties or liabilities of the related Servicer hereunder
(except the repurchase obligations set forth in Sections 2.2 and 2.3 hereof,
which shall remain obligations of the Depositor); provided, however, that until
such appointment and assumption, the Trustee will continue to perform the
servicing obligations pursuant to this Agreement (and until such time shall be
entitled to receive the Servicing Fees pursuant to Section 3.9); provided,
further, that prior to the appointment of any successor servicer, the Rating
Agencies confirm that the appointment of such successor servicer would not
result in the downgrade of the Rating assigned to any Class of Certificates. The
compensation of any successor servicer so appointed shall be equal to the
applicable Servicing Fee specified in Section 3.9 together with such other
compensation as is provided in said Section 3.9. In the event the Trustee is
required to solicit bids as provided above, the Trustee shall solicit, by public
announcement, bids from housing and home finance institutions, banks and
mortgage servicing institutions acceptable to the Trustee and meeting the
qualifications set forth above in this Section 7.5(b) for the purchase of the
servicing functions. Such public
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announcement shall specify that the successor servicer shall be entitled to the
full amount of the applicable Servicing Fee on the aggregate unpaid principal
balance of the Loans as servicing compensation for servicing the Loans, together
with the other servicing compensation in the form of assumption fees, late
payment charges, prepayment fees or otherwise as provided in Section 3.9. Within
45 days after any such public announcement, the Trustee shall negotiate and
effect the sale, transfer and assignment of the servicing rights and
responsibilities hereunder (except the repurchase obligations set forth in
Sections 2.2 and 2.3 hereof, which shall remain obligations of the Depositor) to
the qualified party submitting the highest qualifying bid. The Trustee shall
deduct all costs and expenses of any public announcement and of any sale,
transfer and assignment of the servicing rights and responsibilities hereunder
from any sum received by the Trustee from the successor to the related Servicer
in respect of such sale, transfer and assignment. After such deductions, the
remainder of such sum shall be paid by the Trustee to the Class R
Certificateholder at the time of such sale, transfer and assignment to the
related Servicer's successor.
(c) In the event that a Servicer resigns or is terminated in accordance
with the terms of this Agreement, such Servicer agrees to cooperate with the
Trustee and any successor servicer in effecting the termination of such
Servicer's servicing responsibilities and rights hereunder and shall promptly
provide the Trustee or such successor servicer, as applicable, all documents and
records reasonably requested by it to enable it to assume such Servicer's
functions hereunder and shall promptly also transfer to the Trustee or such
successor servicer, as applicable, all amounts which then have been or should
have been deposited in the Custodial Account for P&I by such Servicer or which
are thereafter received with respect to the Loans. Neither the Trustee nor any
other successor servicer shall be deemed to be in default hereunder by reason of
any failure to make, or any delay in making, any distribution hereunder or any
portion thereof caused by the failure of the related Servicer to deliver, or any
delay in delivering, cash, documents or records to it.
Section 7.6 NOTIFICATION TO CERTIFICATEHOLDERS. Upon any termination of
a Servicer or appointment of a successor to such Servicer, in each case as
provided herein, the Trustee shall as soon as practicable give written notice
thereof to Certificateholders at their respective addresses appearing in the
Certificate Register and each Rating Agency.
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ARTICLE VIII
CONCERNING THE TRUSTEE
Section 8.1 DUTIES OF TRUSTEE. The Trustee, prior to the occurrence of
an Event of Default and after the curing of all Events of Default which may have
occurred, undertakes to perform such duties and only such duties as are
specifically set forth in this Agreement. In case an Event of Default has
occurred (which has not been cured), the Trustee, subject to the provisions of
Sections 7.1, 7.3, 7.4 and 7.5, 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. Any permissive right of the Trustee
enumerated in this Agreement shall not be construed as a duty.
Subject to Sections 8.2(i), 8.3 and 8.4, the Trustee, upon receipt of
all resolutions, certificates, statements, opinions, reports, documents, orders
or other instruments furnished to the Trustee which are specifically required to
be furnished pursuant to any provision of this Agreement, shall examine them to
determine whether they are in the form required by this Agreement; provided,
however, that the Trustee shall not be responsible for the accuracy or content
of any resolution, certificate, statement, opinion, report, document, order or
other instrument furnished by any party hereunder. If any such instrument is
found not to conform to the requirements of this Agreement in a material manner,
the Trustee shall take action as it deems appropriate to have the instrument
corrected, and if the instrument is not corrected to the Trustee's reasonable
satisfaction, the Trustee will provide notice thereof to the Certificateholders
and each Rating Agency.
No provision of this Agreement shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own willful misconduct or in the event the Trustee is acting as
successor servicer pursuant to Section 7.5, to the standard imposed on the
related Servicer pursuant to Section 6.3 of this Agreement; provided, however,
that:
(i) Prior to the occurrence of an Event of Default and after
the curing of all such Events of Default which may have occurred, the
duties and obligations of the Trustee shall be determined solely by the
express provisions of this Agreement, the Trustee shall not 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,
in the absence of bad faith on the part of the Trustee, the Trustee 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 and conforming to the requirements of
this Agreement;
(ii) The Trustee shall not be personally liable with respect
to any action taken, suffered or omitted to be taken by it in good
faith in accordance with this Agreement or at the direction of
Certificateholders holding Certificates which have an aggregate
Certificate Principal Balance aggregating not less than 25% of the
aggregate Certificate Principal
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Balance of all Certificates or 51% of the aggregate Certificate
Principal Balance of any Class of Certificates relating to the time,
method and place of conducting any proceeding for any remedy available
to the Trustee, or exercising or omitting to exercise any trust or
power conferred upon the Trustee, under this Agreement;
(iii) The Trustee shall not be liable in its individual
capacity for any error of judgment made in good faith by any
Responsible Officer, unless it shall be proved that the Trustee or such
Responsible Officer was negligent in ascertaining the pertinent facts;
(iv) The Trustee shall not be liable for any act or omission
of the Depositor or either Servicer (except for its own acts or
omissions as successor servicer hereunder) or for any but its own acts
or omissions;
(v) The Trustee shall not be deemed to take notice or be
deemed to have knowledge of any matter, including without limitation
any default or Event of Default, unless written notice thereof,
referring to the Certificates, the Depositor, the Trust Fund or this
Agreement is received by a Responsible Officer of the Trustee at its
Corporate Trust Office; and
(vi) Subject to the other provisions of this Agreement and
without limiting the generality of this Section 8.1, the Trustee shall
have no duty (A) to see to any recording, filing, or depositing of this
Agreement or any agreement referred to herein or any financing
statement or continuation statement evidencing a security interest, or
to see to the maintenance of any such recording or filing or depositing
or to any rerecording, refiling or redepositing of any thereof, (B) to
see any insurance, (C) to see to the payment or discharge of any tax,
assessment, or other governmental charge or any lien or encumbrance of
any kind owing with respect to, assessed or levied against, any part of
the Trust Fund other than from funds available in the Certificate
Account, and (D) to confirm or verify the contents of any reports or
certificates of a Servicer delivered to the Trustee pursuant to this
Agreement believed by the Trustee to be genuine and to have been signed
or presented by the proper party or parties.
None of the provisions contained in this Agreement shall require the
Trustee to expend or risk its own funds or otherwise incur financial liability
in the performance of any of its duties as Trustee hereunder or in the exercise
of any of its rights or powers if there is reasonable ground for believing that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it, and none of the provisions contained in this
Agreement shall in any event require the Trustee to perform, or be responsible
for the manner of performance of, any of the obligations of a Servicer under
this Agreement except during such time, if any, as the Trustee shall be the
successor to, and be vested with the rights, duties, powers and privileges of, a
Servicer in accordance with the terms of this Agreement.
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Section 8.2 CERTAIN MATTERS AFFECTING TRUSTEE. Except as otherwise
provided in Section 8.1:
(i) Before acting or refraining from acting the Trustee may
request or require an Officer's Certificate; the Trustee may rely and
shall be protected in acting or refraining from acting upon any
resolution, Officer's Certificate, opinion of counsel, certificate of
auditors or any other certificate, statement, instrument, opinion,
report, notice, request, consent, order, appraisal, bond or other paper
or document believed by it to be genuine and to have been signed or
presented by the proper party or parties;
(ii) The Trustee 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) The Trustee shall not 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;
(iv) The right of the Trustee to perform any discretionary act
enumerated in this Agreement shall not be construed as a duty, and the
Trustee shall not be answerable for other than its negligence or
willful misconduct in the performance or non-performance of such act;
(v) The Trustee shall not be required to give any bond or
surety in respect of the execution of the Trust Fund created hereby or
the powers granted hereunder; and
(vi) The Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents, attorneys or custodians, and the Trustee shall not be
responsible for any misconduct or negligence on the part of any such
agent, attorney or custodian appointed by the Trustee with care. Any
such agents, attorneys or custodians shall be entitled to all
indemnities and protection afforded to the Trustee. Any designee of the
Trustee shall be considered its "agent" hereunder whether performing it
as an independent contractor or otherwise.
Section 8.3 TRUSTEE NOT REQUIRED TO MAKE INVESTIGATION. Prior to the
occurrence of an Event of Default hereunder and after the curing of all Events
of Default which may have occurred, the Trustee shall not be bound to ascertain
or inquire as to the performance or observance of any of the terms, conditions,
covenants or agreements herein or to make any investigation into the facts or
matters stated in any resolution, certificate, statement, instrument, opinion,
report, notice, request, consent, order, approval, bond, Mortgage, Mortgage Note
or other paper or document, unless requested in writing so to do by Holders of
Certificates having a Percentage Interest not less than 51% of the Trust Fund;
provided, however, that if the payment within a reasonable time to the Trustee
of the costs, expenses or liabilities likely to be incurred by it in the making
of such
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investigation is, in the opinion of the Trustee, not reasonably assured to the
Trustee by the security afforded to it by the terms of this Agreement, the
Trustee may require reasonable indemnity against such expense or liability as a
condition to such proceeding. The reasonable expense of every such examination
shall be paid by the Depositor or, if paid by the Trustee, shall be repaid by
the Depositor upon demand.
Section 8.4 TRUSTEE NOT LIABLE FOR CERTIFICATES OR LOANS. The recitals
contained herein and in the Certificates (other than the certificate of
authentication on the Certificates) shall be taken as the statements of the
Depositor, and the Trustee assumes no responsibility for the correctness of the
same. The Trustee makes no representations or warranties as to the validity or
sufficiency of this Agreement or of the Certificates or of any Loan or related
document. The Trustee shall not be accountable for the use or application by the
Depositor of any of the Certificates or of the proceeds of such Certificates or
for the use or application of any funds paid to the related Servicer in respect
of the Loans or deposited in or withdrawn from the Custodial Account for P&I by
the related Servicer or for investment of any such amounts. The Trustee shall
not be responsible for the legality or validity of this Agreement or the
validity, priority, perfection or sufficiency of the security for the
Certificates issued or intended to be issued hereunder. The Trustee shall have
no responsibility for filing any financing or continuation statement in any
public office at any time or to otherwise perfect or maintain the perfection of
any security interest or lien granted to it hereunder or to record this
Agreement.
Neither the Trustee nor any of the directors, officers, employees or
agents of the Trustee 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 while
an Event of Default exists; provided, however, that this provision shall not
protect the Trustee or any such person against any liability which would
otherwise be imposed by reason of willful misfeasance, bad faith or negligence
in the performance of duties. The Trustee and any director, officer, employee or
agent of the Trustee shall be indemnified by the Depositor and held harmless
against any loss, liability or expense, including reasonable attorneys' fees,
incurred in connection with or related to the Trustee's performance of its
powers and duties under this Agreement (including, without limitation,
performance under Section 8.1 hereof), or any action relating to this Agreement
or the Certificates, or the performance of the Trustee's duties hereunder, other
than any loss, liability or expense incurred by any such Person by reason of
willful misfeasance, bad faith or negligence in the performance of duties. Any
such losses, liabilities and expenses resulting therefrom shall be losses,
liabilities and expenses of the Depositor. The indemnification provided
hereunder shall survive termination of this Agreement.
Section 8.5 TRUSTEE MAY OWN CERTIFICATES. The Trustee and any Affiliate
or agent of the Trustee in its individual or any other capacity may become the
owner of or a pledgee of the Certificates with the same rights it would have if
it were not Trustee or such agent, and may otherwise deal with the parties
hereto.
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Section 8.6 SERVICER TO PAY TRUSTEE'S FEES AND EXPENSES. Each Servicer
covenants and agrees to pay to the Trustee monthly (or as otherwise agreed), and
the Trustee shall be entitled to receive, reasonable compensation (which shall
not be limited by any provision of law in regard to the compensation of a
trustee of an express trust) for all services rendered by it in the execution of
the trusts hereby created and in the exercise and performance of any of the
powers and duties hereunder of the Trustee, and the related Servicer shall pay
or reimburse the Trustee upon its request for all reasonable expenses,
disbursements and advances, including reasonable attorneys' fees, incurred or
made by the Trustee 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 negligence or bad faith. The Tax
Matters Person (or Person acting as its attorney-in-fact or agent) shall
indemnify the Trustee for any liability of or assessment against the Trustee
resulting from any error in any tax or tax information returns prepared or
caused to be prepared by such Person. In the event that (i) the related Servicer
does not pay to the Trustee any compensation owed to the Trustee pursuant to
this Agreement or (ii) the Trustee is not reimbursed for any expense,
disbursement or advance incurred or made by the Trustee pursuant to this
Agreement, the Trustee shall be entitled to withdraw and retain such amount from
the Certificate Account. In the event the Trustee incurs expenses or renders
services in any proceedings which result from an Event of Default under Section
7.1, subsections (iii), (iv) or (v) of this Agreement, or from any default
which, with the passage of time, would become an Event of Default, the expenses
so incurred and compensation for services so rendered are intended to constitute
expenses of administration under the United States Bankruptcy Code or equivalent
law.
Section 8.7 ELIGIBILITY REQUIREMENTS FOR TRUSTEE. The Trustee hereunder
shall at all times be a corporation or association organized and doing business
under the laws of any state of the United States of America, authorized under
such laws to exercise corporate trust powers, having a combined capital and
surplus of at least $50,000,000 and subject to supervision or examination by
federal or state authority. The Trustee shall not control the Servicers nor be a
parent of or a subsidiary of a Servicer. If such corporation or association
publishes reports of condition at least annually, pursuant to law or to the
requirements of the aforesaid supervising or examining authority, then for the
purposes of this Section 8.7 the combined capital and surplus of such
corporation or association shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. In
case at any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section 8.7, the Trustee shall resign immediately in the
manner and with the effect specified in Section 8.8.
Section 8.8 RESIGNATION AND REMOVAL OF TRUSTEE. The Trustee may at any
time resign and be discharged from the trusts hereby created by giving written
notice of resignation to a Servicer. Such notice shall also be furnished to each
Rating Agency. Upon receiving such notice of resignation, a Servicer shall
promptly appoint a successor trustee by written instrument, in duplicate, one
copy of which instrument shall be delivered to the resigning Trustee and one
copy to the successor trustee. If no successor trustee shall have been so
appointed and have accepted appointment within 30 days after the giving of such
notice of resignation, the resigning Trustee may
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petition any court of competent jurisdiction for the appointment of a successor
trustee at the expense of the related Servicer.
If at any time the Trustee shall cease to be eligible in accordance
with the provisions of Section 8.7 and shall fail to resign after written
request for the Trustee's resignation by a Servicer, or if at any time the
Trustee shall become incapable of acting, or shall be adjudged bankrupt or
insolvent, or a receiver of the Trustee or of its property shall be appointed,
or any public officer shall take charge or control of the Trustee or of its
property or affairs for the purpose of rehabilitation, conservation or
liquidation, then, with or without cause, a Servicer may remove the Trustee and
appoint a successor trustee by written instrument, in duplicate, one copy of
which instrument shall be delivered to the Trustee so removed and one copy to
the successor trustee.
The Holders of Certificates having a Percentage Interest aggregating
not less than 51% of the aggregate Denomination of all Certificates may at any
time remove the Trustee and appoint a successor trustee by written instrument or
instruments, in triplicate, signed by such holders or their attorneys-in-fact
duly authorized, one complete set of which instrument or instruments shall be
delivered to the related Servicer, one complete set to the Trustee so removed
and one complete set to the successor trustee so appointed.
Any resignation or removal of the Trustee and appointment of successor
trustee pursuant to any of the provisions of this Section 8.8 shall become
effective only upon acceptance of appointment by the successor trustee as
provided in Section 8.9.
Section 8.9 SUCCESSOR TRUSTEE. Any successor trustee appointed as
provided in Section 8.8 shall execute, acknowledge and deliver to each Servicer
and to its predecessor trustee an instrument accepting such appointment
hereunder, and thereupon the resignation or removal of the predecessor trustee
shall become effective, and such successor trustee, without any further act,
deed or conveyance, shall become fully vested with all the rights, powers,
duties and obligations of its predecessor hereunder, with like effect as if
originally named as trustee herein. The predecessor trustee shall deliver or
cause to be delivered to the successor trustee all Mortgage Files and related
documents and statements held by it hereunder (other than any Mortgage Files at
the time held by the Custodian, if it shall agree to become the agent of any
successor trustee hereunder), and each Servicer and the predecessor trustee
shall execute and deliver such instruments and do such other things as may
reasonably be required for more fully and certainly vesting and confirming in
the successor trustee all such rights, powers, duties and obligations.
No successor trustee shall accept appointment as provided in this
Section 8.9 unless at the time of such acceptance such successor trustee shall
be eligible under the provisions of Section 8.7.
Upon acceptance of appointment by a successor trustee as provided in
this Section 8.9, each Servicer shall mail notice of the succession of such
trustee hereunder to all holders of Certificates at their addresses as shown in
the Certificate Register and to each Rating Agency. If a Servicer fails
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to mail such notice within ten days after acceptance of appointment by the
successor trustee, the successor trustee shall cause such notice to be mailed at
the expense of the related Servicer.
Section 8.10 MERGER OR CONSOLIDATION OF TRUSTEE. Any Person into which
the Trustee may be merged or converted or with which it may be consolidated, or
any Person resulting from any merger, conversion or consolidation to which the
Trustee shall be a party, or any Person succeeding to all or substantially all
of the corporate trust business of the Trustee, shall be the successor of the
Trustee hereunder, provided, that such Person shall be eligible under the
provisions of Section 8.7, 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 8.11 APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE.
Notwithstanding any other provisions hereof, at any time, for the purpose of
meeting any legal requirements of any jurisdiction in which any part of the
Trust Fund or property securing the same may at the time be located, each
Servicer 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 Fund, and
to vest in such Person or Persons, in such capacity, such title to the Trust
Fund, or any part thereof, and, subject to the other provisions of this Section
8.11, such powers, duties, obligations, rights and trusts as the related
Servicer and the Trustee may consider necessary or desirable. If the related
Servicer shall not have joined in such appointment within 15 days after the
receipt by it of a request so to do, or in case an Event of Default shall have
occurred and be continuing, the Trustee alone shall have the power to make such
appointment. Each co-trustee and separate trustee hereunder shall not be
required to meet the terms of eligibility as a successor trustee under Section
8.7 hereunder and no notice to holders of Certificates of the appointment of
co-trustee(s) or separate trustee(s) shall be required under Section 8.9 hereof.
In the case of any appointment of a co-trustee or separate trustee
pursuant to this Section 8.11, 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, except to the extent that under any law of any jurisdiction in which
any particular act or acts are to be performed (whether as Trustee hereunder or
as successor to any Servicer hereunder), the Trustee shall be incompetent or
unqualified to perform such act or acts, in which event such rights, powers,
duties and obligations (including the holding of title to the Trust Fund or a
portion thereof in any such jurisdiction) shall be exercised and performed by
such separate trustee or co-trustee at the direction of the 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
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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.
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. The Trustee shall not be responsible
for any action or inaction of any such separate trustee or co-trustee. 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.
The Trustee may appoint one or more Eligible Institutions to act as its
agent or agents to perform any or all of its duties and obligations under this
Agreement. Each such agent shall be subject to all of 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.
Section 8.12 APPOINTMENT OF CUSTODIANS. The Trustee may, with the
consent of the related Servicer, appoint one or more Custodians, not affiliated
with the Depositor, to review, pursuant to Section 2.2 hereof, and hold all or a
portion of the Mortgage Files as agent for the Trustee PROVIDED, HOWEVER, that
such appointed Custodian may be LaSalle Bank National Association or Standard
Federal Bank, N.A. Any Custodian appointed shall be (i) LaSalle Bank National
Association or (ii) Standard Federal Bank, N.A., or (iii) (a) an institution
subject to supervision by federal or state authority, (b) shall have combined
capital and surplus of at least $50,000,000 and (c) shall be qualified to do
business in the jurisdiction in which it holds any Mortgage File.
Section 8.13 AUTHENTICATING AGENT.
(a) The Trustee may appoint from time to time an authenticating agent
(the "Authenticating Agent") which shall be authorized to act on behalf of the
Trustee in authenticating Certificates. Wherever reference is made in this
Agreement to the authentication of Certificates by the Trustee or the Trustee's
certificate of authentication, such reference shall be deemed to include
authentication on behalf of the Trustee by the Authenticating Agent and a
certificate of authentication executed on behalf of the Trustee by the
Authenticating Agent. Any successor Authenticating Agent must be acceptable to
each Servicer and have a principal office and place of business in New York, New
York or Chicago, Illinois, have a combined capital and surplus of at least
$50,000,000, and be authorized to do a trust business and subject to supervision
or examination by federal or state authorities.
(b) Any corporation into which the Authenticating Agent may be merged
or converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Authenticating Agent
shall be a party, or any corporation succeeding to all or substantially all of
the corporate agency business of the Authenticating Agent, shall continue
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to be the Authenticating Agent without the execution or filing of any paper or
any further act on the part of the Trustee or the Authenticating Agent.
(c) The Authenticating Agent may at any time resign by giving at least
30 days' advance written notice of resignation to the Trustee and to the
Servicers. The Trustee may at any time terminate the agency of the
Authenticating Agent by giving written notice of termination to the
Authenticating Agent and to the Servicers. Upon receiving a notice of
resignation or upon such a termination, or in case at any time the
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section 8.13, the Trustee promptly shall appoint a successor
Authenticating Agent, shall give written notice of such appointment to the
Servicers and shall mail notice of such appointment to all Certificateholders.
Any successor Authenticating Agent upon acceptance of its appointment hereunder
shall become vested with all the rights, powers, duties and responsibilities of
its predecessor hereunder, with like effect as if originally named as
Authenticating Agent herein. No successor Authenticating Agent shall be
appointed unless eligible under the provisions of this Section 8.13.
(d) The Authenticating Agent shall have no responsibility or liability
for any action taken by it as such at the direction of the Trustee. Any
reasonable compensation paid to the Authenticating Agent shall be a reimbursable
expense under Section 8.6.
Section 8.14 BLOOMBERG. As soon as practicable after the Closing Date,
the Trustee or the Certificate Administrator, if any, will arrange with
Bloomberg to have the Depositor set up on Bloomberg to provide the information
set forth on Exhibit Q (the "Data") with respect to the Loans on a monthly basis
in a format acceptable to Bloomberg and acceptable to the Underwriters. During
the term of this Agreement, the Trustee will provide updated Data to Bloomberg
on or before each Distribution Date.
Section 8.15 CALCULATION OF LIBOR. Until the Certificate Principal
Balance of each of the Adjustable Rate Certificates has been reduced to zero,
LIBOR for the initial Interest Accrual Period shall be 1.32%, and for any
Interest Accrual Period thereafter, the Trustee, if any, shall establish LIBOR
on each LIBOR Determination Date as follows:
(a) If on such LIBOR Determination Date a rate for United States dollar
deposits for one month appears on the Dow Xxxxx Telerate System, page 3750,
LIBOR for the next Interest Accrual Period shall be equal to such rate as of
11:00 a.m., London time;
(b) If such rate does not appear on such page (or such other page as
may replace that page on that service, or if such service is no longer offered,
such other service for displaying LIBOR or comparable rates as may be selected
by the Trustee, if any, after consultation with the Servicers), the rate shall
be determined as follows:
(i) The Trustee on the LIBOR Determination Date will request
the principal London offices of each of four major reference banks in
the London interbank market, as
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selected by the Trustee, to provide the Trustee with its offered
quotation for deposits in United States dollars for the upcoming
one-month period, commencing on the second LIBOR Business Day
immediately following such LIBOR Determination Date, to prime banks in
the London interbank market at approximately 11:00 a.m. London time on
such LIBOR Determination Date and in a principal amount that is
representative for a single transaction in United States dollars in
such market at such time. If at least two such quotations are provided,
LIBOR determined on such LIBOR Determination Date will be the
arithmetic mean of such quotations.
(ii) If fewer than two quotations are provided, LIBOR
determined on such LIBOR Determination Date will be the arithmetic mean
of the rates quoted at approximately 11:00 a.m. in New York City on
such LIBOR Determination Date by three major banks in New York City
selected by the Trustee for one-month United States dollar loans to
leading European banks, in a principal amount that is representative
for a single transaction in United States dollars in such market at
such time; PROVIDED, HOWEVER, that if the banks so selected by the
Trustee are not quoting as mentioned in this sentence, LIBOR determined
on such LIBOR Determination Date will continue to be LIBOR as then
currently in effect on such LIBOR Determination Date.
(c) The establishment of LIBOR on each LIBOR Determination Date by the
Trustee, if any, and the Trustee's calculation of the rate of interest
applicable to the Adjustable Rate Certificates for the related Interest Accrual
Period shall (in the absence of manifest error) be final and binding.
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ARTICLE IX
TERMINATION
Section 9.1 TERMINATION UPON PURCHASE BY THE SERVICERS OR LIQUIDATION
OF ALL LOANS. The respective obligations and responsibilities of the Servicers
and the Trustee created hereby (other than the obligation to make payments to
Certificateholders as hereafter set forth in this Section 9.1 and obligations to
the Trustee in Sections 8.4 and 8.6) shall terminate upon the earlier of (i) the
later of the final payment or other liquidation (or any Advance with respect
thereto) of the last Loan remaining in the Trust Fund and the disposition of all
property acquired in respect of any Loan or (ii) the purchase by the related
Servicer of all related Loans at a price equal to the sum of (a) the principal
balance of each Loan plus accrued interest thereon at the applicable Mortgage
Interest Rate to, but not including, the next scheduled Due Date, and (b) the
fair market value of all acquired property in respect of Loans, such fair market
value to be determined by an appraiser selected by the Trustee; PROVIDED,
HOWEVER, that 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; and provided, further, that a "plan of
liquidation" of each of REMIC I, REMIC II and REMIC III in accordance with
Section 860F of the Code must be adopted in conjunction with any termination
effected pursuant to subclauses (i) or (ii) of this Section 9.1.
WMMSC and AAMG are hereby granted the right to purchase the Group I
Loans and Group II Loans, respectively, pursuant to clause (ii) above, PROVIDED,
HOWEVER, that such right shall be conditioned upon (a) the Principal Balances of
such Group I Loans or Group II Loans, as applicable, at the time of any such
purchase, aggregating an amount less than 5% of the aggregate Principal Balance
of the Group I Loans and Group II Loans, respectively, on the Cut-off Date,
after deduction of payments due on or before such date, and (b) the aggregate
price in clause (ii) above must be not greater than the aggregate fair market
value of the related Loans and all such acquired property.
Notice of any termination pursuant to clause (i) or (ii) above,
specifying the Distribution Date upon which all Certificateholders may surrender
their Certificates to the Trustee or its agent for payment and cancellation,
shall be given promptly by the Trustee or its agent (upon direction by the
related Servicer no less than 10 days prior to the date such notice is to be
mailed) by letter to Certificateholders and each Rating Agency mailed by first
class mail no later than the 25th day of the month preceding the month of such
final distribution specifying (i) the Distribution Date upon which final payment
on the Certificates will be made upon presentation and surrender of Certificates
at the office or agency of the Trustee or the Certificate Registrar therein
designated, (ii) the amount of any such final payment and (iii) that the Record
Date otherwise applicable to such Distribution Date is not applicable, payments
being made only upon presentation and surrender of the Certificates at the
office or agency of the Trustee or the Certificate Registrar therein specified.
The Trustee or its agent shall give such notice to the Certificate Registrar and
each Rating Agency at the time such notice is given to the Certificateholders.
Upon any such termination, the duties of the Certificate Registrar shall also
terminate. In the event such notice is given in connection with the related
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Servicer's election to purchase, such Servicer shall deposit in the Certificate
Account on the related Withdrawal Date an amount equal to the above-described
purchase price and upon such deposit Certificateholders will be entitled to the
amount of such purchase price but not amounts in excess thereof, all as provided
herein. With respect to the Certificates, upon presentation and surrender of the
Certificates pursuant to any termination under this Section 9.1, the Trustee or
Paying Agent shall cause to be distributed to Certificateholders an amount equal
to (a) the amount otherwise distributable on such Distribution Date, if not in
connection with a purchase; or (b) if the related Servicer elected to so
purchase, the purchase price calculated as above provided. Upon any termination
pursuant to clause (iii) above, or upon certification to the Trustee by a
Servicing Officer following such final deposit, the Trustee and any Custodian
shall promptly release to the related Servicer the Mortgage Files for the
remaining Loans, and the Trustee shall execute all assignments, endorsements and
other instruments necessary to effectuate such transfer.
In the event that all of the Certificateholders shall not surrender
their Certificates for cancellation within three months after the time specified
in the above-mentioned written notice, the Trustee or its agent 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 three months after the second notice all the Certificates
shall not have been surrendered for cancellation, the Trustee or its agent shall
take appropriate and reasonable steps as directed by the related Servicer, to
contact the remaining Certificateholders concerning surrender of their
Certificates, and the cost thereof shall be paid out of the funds and other
assets which remain in trust hereunder.
Section 9.2 TRUSTS IRREVOCABLE. Except as expressly provided herein,
all trusts created hereby are irrevocable.
Section 9.3 ADDITIONAL TERMINATION REQUIREMENTS.
(a) In the event a related Servicer or both Servicers, as applicable,
exercises its purchase option as provided in Section 9.1 to repurchase all of
the Loans in a related Loan Group, REMIC I, REMIC II or the Trust Fund and each
of REMIC I, REMIC II and REMIC III, as applicable, shall be terminated in
accordance with the following additional requirements, unless the Trustee and
the Certificate Administrator have received an Opinion of Counsel to the effect
that the failure of the Trust Fund to comply with the requirements of this
Section 9.3 will not (i) result in the imposition of taxes on "prohibited
transactions" of REMIC I, REMIC II or REMIC III of the Trust Fund as described
in Section 860F(a)(2) of the Code, or (ii) cause any of REMIC I, REMIC II or
REMIC III of the Trust Fund to fail to qualify as a REMIC at any time that any
Certificates are outstanding:
(i) Within 90 days prior to the final Distribution Date set
forth in the notice given by the Depositor under Section 9.1, the Tax
Matters Person shall prepare the documents associated with and shall
adopt a plan of complete liquidation of each of REMIC I, REMIC II and
REMIC III in the case of a repurchase of all of the Loans, or shall
adopt a plan of complete liquidation of REMIC I in the case of a
repurchase of all of the Group I Loans, or
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shall adopt a plan of complete liquidation of REMIC II in the case of a
repurchase of all the Group II Loans (a plan of complete liquidation of
REMIC III shall be adopted at the time of the repurchase of the second
of the Loan Groups to be repurchased); and
(ii) At or after the time of adoption of such a plan of
complete liquidation and at or prior to the final Distribution Date,
the related Servicer as agent of the Trustee shall sell all of the
assets of REMIC I, REMIC II or the Trust Fund, as applicable, to the
Depositor for cash in accordance with such plan of liquidation;
provided, however, that in the event that a calendar quarter ends after
the time of adoption of such a plan of complete liquidation but prior
to the final Distribution Date, such Servicer shall not sell any of the
assets of the Trust Fund prior to the close of that calendar quarter.
(b) The Tax Matters Person hereby agrees to adopt such plans of
complete liquidation and to take such other action in connection therewith as
may be reasonably requested by the related Servicer.
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ARTICLE X
MISCELLANEOUS PROVISIONS
Section 10.1 AMENDMENT. This Agreement may be amended from time to time
by the Depositor, any Servicer and the Trustee, without the consent of any of
the Certificateholders, (a) to cure any ambiguity, to correct or supplement any
provision herein which may be inconsistent with any other provision herein, or
to make any other provisions with respect to matters or questions arising under
this Agreement, (b) to modify, eliminate or add to any provisions to such extent
as shall be necessary to maintain the qualification of the Trust Fund as three
REMICs at all times that any Class A or Subordinate Certificates are
outstanding, provided, that the Trustee has received an Opinion of Counsel to
the effect that such action is necessary or desirable to maintain such
qualification, provided, that such action under clauses (a) and (b) above shall
not adversely affect in any material respect the interests of any
Certificateholder or (c) such amendment is made to conform the terms of this
Agreement to the terms described in the Prospectus dated January 23, 2003,
together with the Prospectus Supplement dated May 27, 2003.
This Agreement may also be amended from time to time by the Depositor,
any Servicer and the Trustee with the consent of the Holders of Certificates
evidencing, in aggregate, not less than 66- 2/3% of each Class of Certificates
affected thereby for the purpose of adding any provisions 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 of such Class; provided,
however, that no such amendment shall (a) reduce in any manner the amount of, or
delay the timing of, payments received on Loans which are required to be
distributed in respect of any Certificate without the consent of the Holder of
such Certificate; (b) adversely affect in any material respect the interest of
the Holders of the Class A Certificates in a manner other than as described in
(a) above without the consent of the Holders of Class A Certificates aggregating
not less than 66-2/3% of the aggregate Percentage Interest evidenced by all
Class A Certificates; (c) adversely affect in any material respect the interest
of the Holders of the Subordinate Certificates in a manner other than as
described in clause (a) above without the consent of the Holders of Subordinate
Certificates aggregating not less than 66-2/3% of the aggregate Percentage
Interest evidenced by all Subordinate Certificates; (d) adversely affect in any
material respect the interest of the Class R Certificateholder without the
consent of the Holder of the Class R Certificate; (e) change in any material
respect the rights and obligations of any Servicer or successor Servicer under
this Agreement without the prior written consent of such party; or (f) reduce
the aforesaid percentage of the Certificates the Holders of which are required
to consent to any such amendments without the consent of the Holders of all
Certificates then outstanding; provided, that for the purposes of this
Agreement, the Holder of the Class R Certificate shall have no right to vote at
all times that any Class A Certificates or Subordinate Certificates are
outstanding if such amendment relates to the modification, elimination or
addition of any provision necessary to maintain the qualification of the Trust
Fund as three REMICs.
Notwithstanding any contrary provision of this Agreement, the Trustee
shall not consent to any amendment to this Agreement unless it shall have first
received an Opinion of Counsel to the
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effect that such amendment will not cause any of REMIC I, REMIC II or REMIC III
of the Trust Fund to fail to qualify as a REMIC at any time that any REMIC I
Regular Interests or REMIC II Regular Interests or REMIC III Certificates are
outstanding.
As soon as practicable after the execution of any such amendment, the
Trustee shall furnish written notification of the substance of such amendment to
each Certificateholder and each Rating Agency.
It shall not be necessary for the consent of the Certificateholders
under this Section 10.1 to approve the particular form of any proposed
amendment, but it shall be sufficient if such consent shall approve the
substance thereof. The manner of obtaining such consents and of evidencing the
authorization of the execution thereof by Certificateholders shall be subject to
such reasonable regulations as the Trustee may prescribe.
Prior to the execution of any amendment to this Agreement, the Trustee
shall be entitled to receive and rely upon an Opinion of Counsel stating that
the execution of such amendment is authorized or permitted by this Agreement.
The Trustee may, but shall not be obligated to, enter into any such amendment
which affects the Trustee's own rights, duties or immunities under this
Agreement.
Section 10.2 RECORDATION OF AGREEMENT. This Agreement (or an abstract
hereof, if acceptable by the applicable recording office) 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 a
Servicer at its expense, but only after the Depositor has delivered to the
Trustee 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 constitute but one and
the same instrument.
Section 10.3 LIMITATION ON RIGHTS OF CERTIFICATEHOLDERS. The death or
incapacity of any Certificateholder shall not operate to terminate this
Agreement or the Trust Fund, nor entitle such Certificateholder's legal
representatives or heirs to claim an accounting or take any action or proceeding
in any court for a partition or winding up of the Trust Fund, nor otherwise
affect the rights, obligations and liabilities of the parties hereto or any of
them.
Except as otherwise expressly provided herein no Certificateholder,
solely by virtue of its status as Certificateholder, shall have any right to
vote or in any manner otherwise control the operation and management of the
Trust Fund, or the obligations of the parties hereto, nor shall anything herein
set forth, or contained in the terms of the Certificates, be construed so as to
-128-
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, solely by virtue of its status as
Certificateholder, shall have any right by virtue or by availing of any
provision of this Agreement to institute any suit, action or proceeding in
equity or at law upon or under or with respect to this Agreement, unless such
holder previously shall have given to the Trustee a written notice of default
and of the continuance thereof, as hereinbefore provided, and unless all of the
Holders of Certificates evidencing, in aggregate, not less than 25% of the Trust
Fund shall have made written request upon the Trustee to institute such action,
suit or proceeding in its own name as Trustee hereunder and shall have offered
to the Trustee such reasonable indemnity as it may require against the costs,
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
being understood and intended, and being expressly covenanted by each
Certificateholder with every other Certificateholder and the Trustee, that no
one or more holders of Certificates shall have any right in any manner whatever
by virtue or by availing of any provision of this Agreement to affect, disturb
or prejudice the rights of the Holders of any other of such Certificates, or to
obtain or seek to obtain priority over or preference to any other such Holder,
or to enforce any right under this Agreement, except in the manner herein
provided and for the benefit of all Certificateholders. For the protection and
enforcement of the provisions of this Section 10.3, each and every
Certificateholder and the Trustee shall be entitled to such relief as can be
given either at law or in equity.
Section 10.4 GOVERNING LAW; JURISDICTION. THIS AGREEMENT SHALL BE
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK (WITHOUT REGARD
TO CONFLICTS OF LAWS PRINCIPLES), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF
THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 10.5 NOTICES. All demands, notices and communications hereunder
shall be in writing and shall be deemed to have been duly given if personally
delivered at or mailed by certified or registered mail, return receipt requested
(a) in the case of the Depositor, to ABN AMRO Mortgage Corporation, 000 Xxxxx
XxXxxxx Xxxxxx, Xxxxx 000, Xxxxxxx, Xxxxxxxx 00000, Attention: Xxxxx Xxxxxxx -
Director - ABN AMRO Mortgage Operations, or such other address as may hereafter
be furnished to each Servicer and the Trustee in writing by the Depositor, (b)
in the case of the AAMG, to InterFirst, 000 Xxxx Xxxxxxxxxx Xxxxxxx, Xxx Xxxxx,
Xxxxxxxx 00000, Attention: Xxxxx Xxxx - Vice President with a copy to ABN AMRO
Mortgage Group, Inc., 0000 Xxxx Xxx Xxxxxx Xxxx, Xxxx, Xxxxxxxx 00000,
Attention: Xxxxxx X. Xxxxx, or such other address as may hereafter be furnished
to the Depositor and the Trustee in writing by AAMG, (c) in the case of WMMSC,
to Washington Mutual Mortgage Securities Corp., 0000 Xxxxx Xxxxxx, XXX00,
Xxxxxxx, Xxxxxxxxxx 00000, Attention: Legal Department, or such other address as
may hereafter be furnished to the Depositor and the Trustee in writing by the
WMMSC, (d) in the case of the Trustee, to the Corporate Trust Office, or such
other address as may hereafter be furnished to the Depositor and each Servicer
in
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writing by the Trustee, in each case Attention: Corporate Trust Department, (e)
in the case of Fitch, to Fitch Ratings, Xxx Xxxxx Xxxxxx Xxxxx, 00xx Xxxxx, Xxx
Xxxx, Xxx Xxxx, 00000, Attention: Xxxx Xxxxxxx, Residential Mortgage, or such
other address as may hereinafter be furnished to the Depositor in writing by
Fitch, and (f) in the case of Moody's, to Xxxxx'x investors Service, Inc., 00
Xxxxxx Xxxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx, 00000, Attention: Asset Backed
Monitoring, or such other address as may hereinafter be furnished to the
Depositor in writing by S&P. 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. Any notice mailed
or transmitted within the time prescribed in this Agreement shall be
conclusively presumed to have been duly given, whether or not the addressee
receives such notice; provided, that any demand, notice or communication to or
upon the Depositor, any Servicer or the Trustee shall not be effective until
received.
Section 10.6 SEVERABILITY OF PROVISIONS. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be for any
reason whatsoever held invalid, then such covenants, agreements, provisions or
terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement or of the Certificates
or the rights of the holders thereof.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the Depositor, the Servicers 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.
ABN AMRO MORTGAGE CORPORATION,
as Depositor
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------
Name: Xxxxxx X. Xxxxxxx
Its: Vice President
JPMORGAN CHASE BANK, as Trustee
By: /s/ Xxxxx Xxxxxxx
------------------------------
Name: Xxxxx Xxxxxxx
Its: Trust Officer
ABN AMRO MORTGAGE GROUP, INC.,
as Servicer
By: /s/ Xxxxxxx Xxxxx
------------------------------
Name: Xxxxxxx Xxxxx
Its: Group Senior Vice President
WASHINGTON MUTUAL MORTGAGE
SECURITIES CORP., as Servicer
By: /s/ Xxxxxxx Xxxxxx
------------------------------
Name: Xxxxxxx Xxxxxx
Its: President
STATE OF FLORIDA )
) ss.:
COUNTY OF PALM BEACH )
On the 28th day of May, 2003, before me, _________________________,
personally appeared Xxxxxx X. Xxxxxxx, a Vice President of ABN AMRO Mortgage
Corporation, personally known to me (or proved to me on the basis of
satisfactory evidence) to be the person whose name is subscribed to the within
instrument, and acknowledged to me that he executed the same in his authorized
capacity, and that by his signature on the instrument the person, or the entity
upon behalf of which the person acted, executed the instrument.
WITNESS my hand and official seal:
Signature _____________________________
(SEAL)
STATE OF TEXAS )
) ss.:
COUNTY OF XXXXXX )
On the 28th day of May 2003, before me, _________________________,
personally appeared Xxxxx Xxxxxxx, known to me to be a Trust Officer of JPMorgan
Chase Bank, one of the institutions that executed the within instrument and also
known to me to be the person who executed it on behalf of said institution, and
acknowledged to me that such institution 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
[NOTARIAL SEAL]
STATE OF MICHIGAN )
) ss.:
COUNTY OF OAKLAND )
On the 28th day of May, 2003, before me, ______________________,
personally appeared Xxxxxxx Xxxxx, known to me to be a Group Senior Vice
President of ABN AMRO Mortgage Group, Inc., one of the corporations 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
[NOTARIAL SEAL]
STATE OF )
) ss.
COUNTY OF )
On the 28th day of May, 2003, before me, _________________, personally
appeared _________________, known to me to be a _________________ of Washington
Mutual Mortgage Securities Corp., one of the corporations 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
[NOTARIAL SEAL]
EXHIBIT A
---------
FORMS OF CERTIFICATES
EXHIBIT A-1
-----------
CUSIP ________
FORM OF SENIOR AND SENIOR SUBORDINATE CERTIFICATE
MORTGAGE PASS-THROUGH CERTIFICATE
Class [[__]A-[__], M, B-[__]]
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four-family mortgage loans formed and administered by
ABN AMRO MORTGAGE CORPORATION
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended. The issue
date (the "Issue Date") of this Certificate is May __, 2003. [The rate at which
interest is payable as of the Issue Date with respect to this Certificate is
[___]% per annum.][Interest is not payable with respect to this 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 such other name as is
requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.]
[The Class [M, B-[__]] Certificates will be subordinate in right of payment to
and provide credit support to certain Classes of Certificates, as described in
the Pooling Agreement.
Series 2003-6 Portion of the Class [[__]A-[__],
M, B-[__]] [Principal Balance]
[Notional Amount] as of the Cut-Off
Date evidenced by this Certificate:
$________________
Class [[__]A-[__], M, B-[__]] Remittance Rate: [___]%
Cut-Off Date: [__________]
First Distribution Date: [__________]
Last Scheduled Distribution Date: [__________]
Class [[__]A-[__], M, B-[__]] [Principal Balance][Notional Amount] as of the
Cut-Off Date:
$______________
--------------------
Registered Owner Certificate No.___
EXHIBIT A-2
-----------
CUSIP_______
FORM OF JUNIOR SUBORDINATE CERTIFICATE
MORTGAGE PASS-THROUGH CERTIFICATE
Class B-[__]
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to four-family mortgage loans formed and administered by
ABN AMRO MORTGAGE CORPORATION
This Certificate represents ownership of a "regular interest" in a "real estate
mortgage investment conduit," as those terms are defined in Sections 860G and
860D, respectively, of the Internal Revenue Code of 1986, as amended (the
"Code"). The issue date (the "Issue Date") of this Certificate is May __, 2003.
The rate at which interest is payable as of the Issue Date with respect to this
Certificate is [___]% per annum.
IN THE CASE OF ANY CLASS B-[__] CERTIFICATE PRESENTED FOR REGISTRATION IN THE
NAME OF AN EMPLOYEE BENEFIT OR OTHER PLAN SUBJECT TO THE PROHIBITED TRANSACTION
PROVISIONS OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED
("ERISA"), OR SECTION 4975 OF THE CODE (OR COMPARABLE PROVISIONS OF ANY
SUBSEQUENT ENACTMENTS) (A "PLAN"), A TRUSTEE OF ANY SUCH PLAN, OR ANY OTHER
PERSON WHO IS USING "PLAN ASSETS" OF ANY SUCH PLAN TO EFFECT SUCH ACQUISITION,
THE TRUSTEE OR CERTIFICATE REGISTRAR SHALL REQUIRE SUCH TRANSFEREE TO PROVIDE AN
OFFICER'S CERTIFICATE SIGNED BY A RESPONSIBLE OFFICER OF SUCH TRANSFEREE STATING
THAT THE TRANSFEREE IS AN INSURANCE COMPANY USING ASSETS OF AN "INSURANCE
COMPANY GENERAL ACCOUNT" (WITHIN THE MEANING OF DEPARTMENT OF LABOR PROHIBITED
TRANSACTION CLASS EXEMPTION ("PTCE") 95-60) TO EFFECT SUCH PURCHASE AND
SATISFIES ALL OF THE REQUIREMENTS FOR EXEMPTIVE RELIEF UNDER SECTIONS I AND III
OF PTCE 95-60, WHICH OFFICER'S CERTIFICATE SHALL NOT BE AN EXPENSE OF THE
TRUSTEE, THE CERTIFICATE ADMINISTRATOR, THE CERTIFICATE REGISTRAR, THE SERVICERS
OR THE DEPOSITOR.
The Class B-[__] Certificates will be subordinate in right of payment to and
provide credit support to certain Classes of Certificates, as described in the
Pooling Agreement.
Series 2003-6 Portion of the Class B-[__]
Principal Balance as of the Cut-Off
Date evidenced by this Certificate:
$_________________
Class B-[__] Remittance Rate: [____]%
Cut-Off Date: [___________]
First Distribution Date: [____________]
Last Scheduled Distribution Date: [____________]
Class B-[__] Principal Balance as of the Cut-Off Date: $________________
--------------------
Registered Owner Certificate No.___
EXHIBIT B
---------
FORM OF RESIDUAL CERTIFICATE
CUSIP ______
MORTGAGE PASS-THROUGH CERTIFICATE
Class R
Evidencing a Percentage Interest in certain distributions with respect to a pool
of conventional one- to-four family mortgage loans formed and administered by
ABN AMRO MORTGAGE CORPORATION
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE MADE ONLY
IF THE PROPOSED TRANSFEREE PROVIDES A TRANSFER AFFIDAVIT AND AGREEMENT, TO THE
DEPOSITOR, THE TRUSTEE AND THE CERTIFICATE REGISTRAR THAT (1) SUCH TRANSFEREE IS
NOT EITHER (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 ENABLE THE TRANSFER OR TO IMPEDE THE ASSESSMENT
OR COLLECTION OF TAX. SUCH AFFIDAVIT SHALL INCLUDE CERTAIN REPRESENTATIONS AS TO
THE FINANCIAL CONDITION OF THE PROPOSED TRANSFEREE. NOTWITHSTANDING THE
REGISTRATION IN THE CERTIFICATE REGISTER OF 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.
IN THE CASE OF ANY CLASS R CERTIFICATE PRESENTED FOR REGISTRATION IN THE NAME OF
AN EMPLOYEE BENEFIT OR OTHER PLAN SUBJECT TO THE PROHIBITED TRANSACTION
PROVISIONS OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED
("ERISA"), OR SECTION 4975 OF THE CODE (OR COMPARABLE PROVISIONS OF ANY
SUBSEQUENT ENACTMENTS) (A "PLAN"), OR A TRUSTEE OF ANY SUCH PLAN, OR ANY OTHER
PERSON WHO IS USING "PLAN ASSETS" OF ANY
SUCH PLAN TO EFFECT SUCH ACQUISITION, THE TRUSTEE OR CERTIFICATE REGISTRAR SHALL
REQUIRE SUCH TRANSFEREE TO PROVIDE AN OPINION OF COUNSEL AS SPECIFIED IN SECTION
5.1(d)(i) OF THE AGREEMENT.
Solely for U.S. federal income tax purposes, this Certificate represents
"residual interests" in "real estate mortgage investment conduits," as those
terms are defined in Sections 860G and 860D, respectively, of the Internal
Revenue Code of 1986, as amended.
Series 2003-6 Percentage Interest evidenced
by this Class R Certificate
in the distributions to be
made with respect to the
Class R Certificate: 100%
Class R Remittance Rate: Additionally the Class R
Certificates are entitled to
Excess Liquidation Proceeds
and the Residual Distribution
Amount as defined in the
Pooling Agreement.
Cut-Off Date: [________ 1, 20__]
First Distribution Date: [________ 1, 20__]
Last Scheduled Distribution Date: [________ 1, 20__]
Class R Principal Balance as of the Cut-Off Date: $_______________
_________________ Certificate No.
Registered Owner
EXHIBIT C-1
-----------
FORM OF INTERIM CERTIFICATION
[Date]
JPMorgan Chase Bank ABN AMRO Mortgage Corporation
000 Xxxxxx Xxxxxx, 10th Floor 000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxx 00000 Xxxxx 000
Xxxxxxx, Xxxxxxxx 00000
LaSalle Bank National Association, as
Certificate Registrar
000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: ABN AMRO Mortgage Corporation, Multi-Class Mortgage Pass-Through
Certificates, Series 2003-6
Re: Pooling and Servicing Agreement, dated as of May 1,
2003, by and among ABN AMRO Mortgage Corporation, ABN
AMRO Mortgage Group, Inc., Washington Mutual Mortgage
Securities Corp. and JPMorgan Chase Bank relating to
ABN AMRO Mortgage Corporation, Multi-Class Mortgage
Pass-Through Certificates, Series 2003-6
------------------------------------------------------
Ladies and Gentlemen:
In accordance with Section 2.2(b) of the above-captioned Pooling and
Servicing Agreement, the undersigned, as Custodian, hereby certifies that it has
received a Mortgage File to the extent required pursuant to Section 2.1 of the
Pooling and Servicing Agreement with respect to each Loan listed in the Mortgage
Loan Schedule, and it has reviewed the Mortgage File and the Mortgage Loan
Schedule and has determined that: all required documents have been executed and
received and that such documents relate to the Mortgage Loans identified on the
Mortgage Loan Schedule, with any exceptions listed on Schedule A attached
hereto.
Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the above-captioned Pooling and Servicing
Agreement.
LASALLE BANK NATIONAL ASSOCIATION
By: ______________________________
Name: _____________________________
Title: ____________________________
EXHIBIT C-2
-----------
FORM OF FINAL CERTIFICATION
[Date]
JPMorgan Chase Bank ABN AMRO Mortgage Corporation
000 Xxxxxx Xxxxxx, 10th Floor 000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxx 00000 Xxxxx 000
Xxxxxxx, Xxxxxxxx 00000
LaSalle Bank National Association, as
Certificate Registrar
000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: ABN AMRO Mortgage Corporation, Multi-Class Mortgage Pass-Through
Certificates, Series 2003-6
Re: Pooling and Servicing Agreement, dated as of May 1,
2003, by and among ABN AMRO Mortgage Corporation, ABN
AMRO Mortgage Group, Inc., Washington Mutual Mortgage
Securities Corp. and JPMorgan Chase Bank relating to
ABN AMRO Mortgage Corporation, Multi-Class Mortgage
Pass- Through Certificates, Series 2003-6
------------------------------------------------------
Ladies and Gentlemen:
In accordance with Section 2.2(c) of the above-captioned
Pooling and Servicing Agreement, the undersigned, as Custodian, hereby certifies
that it has received a Mortgage File with respect to each Loan listed in the
Mortgage Loan Schedule containing with respect to each such Loan:
(1) The original Mortgage Note, endorsed without recourse to
the order of the Trustee and showing an unbroken chain of endorsements
from the originator thereof to the Person endorsing it to the Trustee
or an original lost note affidavit from the related Depositor stating
that the original Mortgage Note was lost, misplaced or destroyed,
together with a copy of the related Mortgage Note;
(2) The original Mortgage with evidence of recording indicated
thereon or a copy of the Mortgage certified by the public recording
office in which such mortgage has been recorded;
(3) An original Assignment of the Mortgage to the Trustee with
evidence of recording indicated thereon or a copy of such assignment
certified by the public recording office in which such assignment has
been recorded;
(4) With respect to each Mortgage Loan, to the extent
available, the original recorded assignment or assignments of the
Mortgage showing an unbroken chain of title from the originator thereof
to the Person assigning it to the Trustee or a copy of such assignment
or assignments of the Mortgage certified by the public recording office
in which such assignment or assignments have been recorded; and
(5) The original of each modification, assumption, extension
or guaranty agreement, if any, relating to such Loan or a copy of each
modification, assumption, extension or guaranty agreement certified by the
public recording office in which such document has been recorded.
Capitalized words and phrases used herein shall have the
respective meanings assigned to them in the above-captioned Pooling and
Servicing Agreement.
LASALLE BANK NATIONAL ASSOCIATION
By: ______________________________
Name: ____________________________
Title: ___________________________
EXHIBIT D
---------
SCHEDULE OF LOANS
See Schedule I to the Mortgage Loan Purchase Agreements, each dated as
of May 28, 2003, between the applicable Seller and the Purchaser
EXHIBIT E
---------
FIELDS OF LOAN INFORMATION
Deal Name
Distribution Date
Loan Number
Loan Group
City
State
Zip Code
Property Type (SFR, CONDO, etc.)
Occupancy Status (Owner, Investor, etc.)
Loan Purpose (Purchase, Refi, etc.)
Loan Type Loan Status (Current, Foreclosure, REO, Bankruptcy)
Original Term of Loan
Amortization Term
First Payment of Loan
Maturity Date
Appraisal Value
Original LTV
Original Principal Balance
Previous Month's Balance
Current Principal Balance
Prepay Date
Prepay Status (Loan has been prepaid, liquidated or repurchased by the related
Servicer)
Original Scheduled P&I
Current Scheduled P&I
Scheduled Interest Amount
Scheduled Principal Amount
Curtailment Note
Rate Paid to Date
Payment Date
EXHIBIT F
---------
FORM OF TRANSFEROR CERTIFICATE FOR
PRIVATELY OFFERED CERTIFICATES
[Date]
JPMorgan Chase Bank, as Trustee
000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxx 00000
Attn: Institutional Trust Services
LaSalle Bank National Association, as Certificate Registrar
000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attn: Asset Backed Securities Trust Services - ABN AMRO Series 2003-6
Re: Purchase of ABN AMRO Mortgage Corporation Mortgage Pass-Through
Certificates Series 2003-6, Class [B-3] [B-4] [B-5] (the "Certificates")
Ladies and Gentlemen:
In connection with our disposition of the above Certificates we certify that (a)
we understand 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, and (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, or taken any other action which would result in a
violation of Section 5 of the Act.
Very truly yours,
[Name of Transferor]
By:________________________________
Authorized Officer
EXHIBIT G
---------
FORM OF TRANSFEREE'S CERTIFICATE FOR
PRIVATELY OFFERED CERTIFICATES
[Date]
JPMorgan Chase Bank
000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxx 00000
Attn: Institutional Trust Services
ABN AMRO Mortgage Corporation
000 Xxxxx XxXxxxx Xxxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxxx 00000
LaSalle Bank National Association, as Certificate Registrar
000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attn: Asset Backed Securities Trust Services - ABN AMRO Series 2003-6
The undersigned (the "Purchaser") proposes to purchase [Class B-3] [Class B-4]
[Class B-5] Certificates evidencing an undivided interest in ABN AMRO Mortgage
Corporation Mortgage Pass-Through Certificates, Series 2003-6 (the "Purchased
Certificates") in the principal amount of $__________. In doing so, the
Purchaser hereby acknowledges and agrees as follows:
Section 1. Definitions. Each capitalized term used herein and not
otherwise defined herein shall have the meaning ascribed to it in the Pooling
and Servicing Agreement, dated as of May 1, 2003, between ABN AMRO Mortgage
Corporation ("AAMC"), ABN AMRO Mortgage Group, Inc., as a servicer ("AAMG"),
Washington Mutual Mortgage Securities Corp. as a servicer ("WMMSC" and together
with AAMG, the "Servicers") and JPMorgan Chase Bank, as trustee (the "Trustee"),
of the ABN AMRO Mortgage Corporation Mortgage Pass-Through Certificates, Series
2003-6.
Section 2. Representations and Warranties of the Purchaser. In
connection with the proposed transfer, the Purchaser represents and warrants to
AAMC, the Servicers, the Certificate Registrar and the Trustee that:
(a) The Purchaser is duly organized, validly existing and in good
standing under the laws of the jurisdiction in which the Purchaser is organized,
is authorized to invest in the Purchased Certificates, and to enter into this
Agreement, and duly executed and delivered this Agreement;
(b) The Purchaser is acquiring the Purchased Certificates for its own
account as principal and not with a view the distribution thereof, in whole or
in part;
(c) The Purchaser is an "accredited investor" as such term is defined
in paragraph (a)(1), (a)(2), (a)(3), (a)(7) or (a)(8) of Section 501 of
Regulation D under the Securities Act of 1933, as amended (the "Act"), has
knowledge of financial and business matters and is capable of evaluating the
merits and risks of an investment in the Purchased Certificates; the Purchaser
has sought such accounting, legal and tax advice as it has considered necessary
to make an informed investment decision; and the Purchaser is able to bear the
economic risk of an investment in the Purchased Certificates and can afford a
complete loss of such investment;
(d) The Purchaser is not affiliated with the Trustee;
(e) The Purchaser confirms that AAMC has made available to the
Purchaser the opportunity to ask questions of, and receive answers from AAMC
concerning the Trust, the purchase by the Purchaser of the Purchased
Certificates and all matters relating thereto that AAMC possesses or can acquire
without unreasonable effort or expense;
(f) If applicable, the Purchaser has complied, and will continue to
comply, with the guidelines established by Thrift Bulletin 12 issued December
13, 1988, by the Office of Regulatory Activities of the Federal Home Loan Bank
System; and
(g) The Purchaser will provide the Trustee and the related Servicer
with affidavits substantially in the form of Exhibit A attached hereto.
Section 3. Transfer of Purchased Certificates.
(a) The Purchaser understands that the Purchased Certificates have not
been registered under the Act, or any state securities laws and that no transfer
may be made unless the Purchased Certificates are registered under the Act and
under applicable state law or unless an exemption from registration is
available. The Purchaser further understands that neither AAMC nor the Trust is
under any obligation to register the Purchased Certificates or make an exemption
available. In the event that such a transfer is to be made within two years from
the Closing Date without registration under the Act or applicable state
securities laws, (i) the Trustee or the Certificate Registrar shall require, in
order to assure compliance with such laws, that the Certificateholder's
prospective transferees each certify to AAMC, the Certificate Registrar and the
Trustee as to the factual basis for the registration or qualification exemption
relied upon, and (ii) the Trustee, the Certificate Registrar or AAMC may require
an Opinion of Counsel that such transfer may be made pursuant to an exemption
from the Act and state securities laws, which Opinion of Counsel shall not be an
expense of the Trustee, the Certificate Registrar or AAMC. Any such
Certificateholder desiring to effect such transfer shall, and does hereby agree
to, indemnify the Trustee and AAMC 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.
(b) No transfer of a Purchased Certificate shall be made unless the
transferee provides AAMC, the Certificate Registrar and the Trustee with (i) a
Transferee's Agreement, substantially in the form of this Agreement, and (ii) an
affidavit substantially in the form of Exhibit A hereto that the proposed
transferee (x) is not an employee benefit plan or other plan or arrangement
subject to the prohibited transaction provisions of ERISA or Section 4975 of the
Internal Revenue Code of
1986, as amended, or comparable provisions of any subsequent enactments (a
"Plan"), a trustee of any Plan, or any other Person who is using the "plan
assets" of any Plan to effect such acquisition or (y) is an insurance company,
the source of funds to be used by it to purchase the Purchased Certificates is
an "insurance company general account" (within the meaning of Department of
Labor Prohibited Transaction Class Exemption ("PTCE") 95-60), and is eligible
for, and satisfies all the requirements for, exemptive relief under Sections I
and III of XXXX 00 00.
(c) The Purchaser acknowledges that its Purchased Certificates bear a
legend setting forth the applicable restrictions on transfer.
IN WITNESS WHEREOF, the undersigned has caused this Agreement to be
validly executed by its duly authorized representative as of the day and the
year first above written.
[Purchaser]
By: _______________________________
Its:
Exhibit A to Form of Transferee Agreement (Exhibit G)
BENEFIT PLAN AFFIDAVIT
RE: ABN AMRO Mortgage Corporation Mortgage Pass-through Certificates,
Series 2003-6 (The "Trust") [Class B-3] [Class B-4] [Class B-5]
Certificates (The "Purchased Certificates")
Under penalties of perjury, I, __________________, declare that, to the
best of my knowledge and belief, the following representations are true, correct
and complete; and
1. That I am the _________________________ of ________________________
(the "Purchaser"), whose taxpayer identification number is ___________________,
and on behalf of which I have the authority to make this affidavit.
2. That the Purchaser is acquiring a Purchased Certificate representing
an interest in Trust.
3. That the Purchaser (i) is not an employee benefit plan or other plan
or arrangement subject to the prohibited transaction provisions 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 comparable
provisions of any subsequent enactments (a "Plan"), a trustee of any Plan, or
any other Person who is using the "plan assets" of any Plan to effect such
acquisition, or (ii) has provided an Officer's Certificate signed by a
Responsible Officer of the Purchaser satisfactory to ABN AMRO Mortgage
Corporation (the "Depositor"), the Certificate Registrar, and the Trustee of the
Trust stating that the Purchaser is an insurance company using assets of an
"insurance company general account" (within the meaning of Department of Labor
Prohibited Transaction Class Exemption ("PTCE") 95-60) to effect such purchase
and is eligible for, and satisfies all of the requirements for exemptive relief
under Sections I and III of PTCE 95-60, which Officer's Certificate shall not be
an expense of the Depositor, the Certificate Administrator, the Certificate
Registrar, the Servicers or the Trustee.
IN WITNESS WHEREOF, the Purchaser has caused this instrument to be duly
executed on its behalf, by its duly authorized officer this ____ day of _____,
20__.
[Purchaser]
By:______________________________
Its:
Personally appeared before me __________________, known or proved to me
to be the same person who executed the foregoing instrument and to be a of the
Purchaser, and acknowledged to me that (s)he executed the same as his/her free
act and deed and as the free act and deed of the Purchaser.
SUBSCRIBED and SWORN to before me this __day of ______________, 20___.
___________________________________
Notary Public
EXHIBIT H
---------
[RESERVED]
EXHIBIT I
---------
FORM OF TRANSFEROR CERTIFICATE
[Date]
JPMorgan Chase Bank, as Trustee
000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxx 00000
Attn: Institutional Trust Services
LaSalle Bank National Association, as Certificate Registrar
000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attn: Asset Backed Securities Trust Services - ABN AMRO Series 2003-6__________
Re: ABN AMRO Mortgage Corporation Mortgage Pass-Through Certificates,
Series 2003-6 Class R
This letter is delivered to you in connection with the sale by
_______________________ (the "Seller") to _______________________ (the
"Purchaser") of $_______________________ initial Certificate Principal Balance
of Mortgage Pass-Through Certificates, Series 2003-6, Class R (the
"Certificate"), pursuant to Section 5.1 of the Pooling and Servicing Agreement
(the "Pooling and Servicing Agreement"), dated as of May 1, 2003 among ABN AMRO
Mortgage Corporation, as depositor (the "Company"), ABN AMRO Mortgage Group,
Inc., as a servicer ("AAMG"), Washington Mutual Mortgage Securities Corp. as a
servicer ("WMMSC" and together with AAMG, the "Servicers"), and JPMorgan Chase
Bank, as trustee (the "Trustee"). All terms used herein and not otherwise
defined shall have the meanings set forth in the Pooling and Servicing
Agreement. The Seller hereby certifies, represents and warrants to, and
covenants with the Depositor, the Servicers, the Certificate Registrar and the
Trustee that:
1. No purpose of the Seller relating to the sale of the Certificate by
the Seller to the Purchaser is or will be to enable the Seller to impede the
assessment or collection of tax.
2. The Seller understands that the Purchaser has delivered to the
Trustee, the Servicers, the Certificate Registrar and the Depositor a transferee
affidavit and agreement in the form attached to the Pooling and Servicing
Agreement as Exhibit J. The Seller does not know or believe that any
representation contained therein is false.
3. The Seller has no actual knowledge that the Proposed Transferee is
not a Permitted Transferee.
4. The Seller has no actual knowledge that the Purchaser would be
unwilling or unable to pay taxes due on its share of the taxable income
attributable to the Certificates.
5. At the time of this transfer (i) the Seller has conducted a
reasonable investigation of the financial condition of the Purchaser and, as a
result of the investigation, found that the Purchaser has historically paid its
debts as they came due, and found no significant evidence to indicate that the
Purchaser will not continue to pay its debts as they come due in the future and
(ii) either (A) the Seller both (1) has determined all of the following (I) at
the time of the transfer, and at the close of each of the Purchaser's two fiscal
years preceding the year of transfer, the Purchaser's gross assets for financial
reporting purposes exceed $100 million and its net assets for such purposes
exceed $10 million (disregarding, for purposes of determining gross or net
assets, the obligation of any person related to the Purchaser within the meaning
of section 860L(g) of the Code or any other asset if a principal purpose for
holding or acquiring that asset is to permit the Purchaser to satisfy this
minimum gross asset or net asset requirement), (II) the Purchaser is a domestic
C corporation for United States federal income tax purposes that is not for such
purposes an exempt corporation, a regulated investment company, a real estate
investment trust, a REMIC, or a cooperative organization to which part I of
subchapter T of the Code applies, (III) there are no facts or circumstances on
or before the date of transfer (or anticipated) which would reasonably indicate
that the taxes associated with the Certificates will not be paid, (IV) the
Purchaser is not a foreign branch of a domestic corporation, and (V) the
transfer does not involve a transfer or assignment to a foreign branch of a
domestic corporation (or any other arrangement by which any Certificate is at
any time subject to net tax by a foreign country or U.S. possession) and the
Purchaser will not hereafter engage in any such transfer or assignment (or any
such arrangement), and (2) does not know or have reason to know that the
Purchaser will not honor the restrictions on subsequent transfers of any Class R
Certificate described in paragraph 12 and 13 of the Transferee's Transfer
Affidavit, or (B) the Seller has determined that the present value of the
anticipated tax liabilities associated with the holding of the Certificates do
not exceed the sum of (1) the present value of any consideration given to the
Purchaser to acquire the Certificates, (2) the present value of the expected
future distributions on the Certificates, and (3) the present value of the
anticipated tax savings associated with holding the Certificates as the REMIC
generates losses (having made such determination by (I) assuming that the
Purchaser pays tax at a rate equal to the highest rate of tax specified in
Section 11(b)(1) of the Code, and (II) utilizing a discount rate for present
valuation purposes equal to the applicable Federal rate prescribed by Section
1274(d) of the Code compounded semi-annually (or a lower discount rate based on
the Purchaser having demonstrated that it regularly borrows, in the course of
its trade or business, substantial funds at such lower rate from unrelated third
parties)).
6. The Purchaser has represented to the Seller that, if the
Certificates constitute a noneconomic residual interest, it (i) understands that
as holder of a noneconomic residual interest it may incur tax liabilities in
excess of any cash flows generated by the interest, and (ii) intends to pay
taxes associated with its holding of the Certificates as they become due.
7. The Seller understands that the transfer of the Certificates may not
be respected for United States income tax purposes (and the Seller may continue
to be liable for United States income taxes associated therewith) unless there
is compliance with the standards of paragraph 5. above as to any transfer.
Very truly yours,
[Seller]
By:________________________________
Name:
Title:
EXHIBIT J
---------
FORM OF TRANSFEREE AFFIDAVIT AND AGREEMENT
STATE OF )
) ss:
COUNTY OF )
[NAME OF OFFICER], being first duly sworn, deposes and says:
1. That he is [Title of Officer] of [Name of Owner] (record or
beneficial owner of the Class R Certificate (the "Owner")), a [savings
institution] [corporation] duly organized and existing under the laws of [the
State of ] [the United States], on behalf of which he makes this affidavit and
agreement.
2. That the Owner (i) is not and will not be a "disqualified
organization" as of the [date of transfer] within the meaning of Section
860E(e)(5) of the Internal Revenue Code of 1986, as amended (the "Code") and
will endeavor to remain other than a disqualified organization for so long as it
retains its ownership interest in the Class R Certificate, and (ii) is acquiring
the Class R Certificate for its own account or for the account of another Owner
from which it has received an affidavit and agreement in substantially the same
form as this affidavit and agreement. (For this purpose, a "disqualified
organization" means the United States, any state or political subdivision
thereof, or any agency or instrumentality of any of the foregoing (other than an
instrumentality all of the activities of which are subject to tax and, except
for the Federal Home Loan Mortgage Corporation, a majority of whose board of
directors is not selected by any such governmental entity, or any foreign
government or international organization, or any agency or instrumentality of
such foreign government or organization, any rural electric or telephone
cooperative, or any organization (other than certain farmers' cooperatives) that
is generally exempt from federal income tax unless such organization is subject
to the tax on unrelated business taxable income).
3. That the Owner is aware (i) of the tax that would be imposed on
transfers of the Class R Certificate; (ii) that such tax would be on the
transferor, or, if such transfer is through an agent (which person includes a
broker, nominee or middleman) for a disqualified organization, on the agent;
(iii) that the person otherwise liable for the tax shall be relieved of
liability for the tax if the transferee furnished to such person an affidavit
that the transferee is not a disqualified organization and, at the time of
transfer, such person does not have actual knowledge that the affidavit is
false; and (iv) that the Class R Certificate may represent "noneconomic residual
interests" 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,
if a significant purpose of the transfer was to enable the transferor to impede
the assessment or collection of tax.
4. That the Owner is aware of the tax imposed on a "pass-through
entity" holding the Class R Certificate if at any time during the taxable year
of the pass-through entity a disqualified organization is the record holder of
an interest in such entity. (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.)
5. That the Owner is aware that the Trustee and the Certificate
Registrar will not register the transfer of the Class R Certificate unless the
transferee, or other transferee's agent, delivers to each of them an affidavit
and agreement, among other things, in substantially the same form as this
affidavit and agreement. The Owner expressly agrees that it will not consummate
any such transfer if it knows or believes that any of the representations
contained in such affidavit and agreement are false.
6. That the Owner has reviewed the restrictions set forth on the face
of the Class R Certificate and the provisions of Section 5.1 of the Pooling and
Servicing Agreement under which the Class R Certificate was issued. The Owner
expressly agrees to be bound by and to comply with such restrictions and
provisions.
7. That the Owner consents to any additional restrictions or
arrangements that shall be deemed necessary upon advice of counsel to constitute
a reasonable arrangement to ensure that the Class R Certificate will only be
owned, directly or indirectly, by an Owner that is not a disqualified
organization.
8. The Owner's Taxpayer Identification Number is _____________.
9. That no purpose of the Owner relating to the purchase of the Class R
Certificate by the Owner is or will be to enable the transferor to impede the
assessment or collection of tax.
10. That the Owner has no present knowledge or expectation that it will
be unable to pay any United States taxes owed by it so long as any of the
Certificates remain outstanding.
11. That the Owner has no present knowledge or expectation that it will
become insolvent or subject to a bankruptcy proceeding for so long as any of the
Certificates remain outstanding.
12. The Owner will, in connection with any transfer that it makes of
the Class R Certificate deliver to the Certificate Registrar a representation
letter substantially in the form of Exhibit I to the Pooling and Servicing
Agreement. [The Owner hereby agrees that it will not make any transfer of any
Class R Certificate unless (i) the transfer is to an entity which is a domestic
C corporation (other than an exempt corporation, a regulated investment company,
a real estate investment trust, a REMIC, or a cooperative organization to which
part I of Subchapter T of the Code applies) for federal income tax purposes, and
(ii) the transfer is in compliance with the conditions set forth in paragraph 5
of Exhibit I of the Pooling and Servicing Agreement.]1/
---------------------
1/Bracketed text to be included if the Owner is relying on the transferee's
compliance with the "Asset Test Safe Harbor" (which is generally described as
the second "safe harbor" in the Prospectus Supplement) rather than the "Formula
Test Safe Harbor" (which is generally described as the first "safe harbor" in
the Prospectus Supplement). See "Federal Income Tax Consequences--Special Tax
Considerations Applicable to the Residual Certificate" in the
13. The Owner (i) is a citizen or resident of the United States, a
corporation or partnership (including an entity treated as a corporation or
partnership for federal income tax purposes) created or organized in, or under
the laws of, the United States or any state thereof or the District of Columbia
(except, in the case of a partnership, to the extent provided in regulations) or
an estate whose income is subject to United States federal income tax regardless
of its source, or a trust if a court within the United States is able to
exercise primary supervision over the administration of the trust and one or
more such U.S. Persons have the authority to control all substantial decisions
of the trust and (ii) if the Owner is a partnership for U.S. federal income tax
purposes, each person or entity which holds an interest (directly or indirectly,
through a pass-through entity) is a person or entity described in (i). To the
extent prescribed in regulations by the Secretary of the Treasury, which have
not yet been issued, a trust which was in existence on August 20, 1996 (other
than a trust treated as owned by the grantor under subpart E of part 1 of
subchapter J of chapter 1 of the Code), and which was treated as a U.S. Person
on August 20, 1996 may elect to continue to be treated as a U.S. Person
notwithstanding the previous sentence.
14. The Owner hereby agrees to cooperate with the Depositor and to take
any action required of it by the Code or Treasury regulations thereunder
(whether now or hereafter promulgated) in order to create or maintain the REMIC
status of the REMIC I, REMIC II or the REMIC III.
15. The Owner hereby agrees that it will not take any action that could
endanger the REMIC status of the REMIC I, REMIC II or the REMIC III, as
applicable, or result in the imposition of tax on the REMIC I, REMIC II or the
REMIC III unless counsel for, or acceptable to, the Depositor has provided an
opinion that such action will not result in the loss of such REMIC status or the
imposition of such tax, as applicable.
16. The Owner as transferee of the Class R Certificate has represented
to their transferor that, if the Class R Certificate represents noneconomic
residual interests, the Owner (i) understands that as holder of a noneconomic
residual interest it may incur tax liabilities in excess of any cash flows
generated by the interest, and (ii) intends to pay taxes associated with its
holding of the Class R Certificate as they become due.
[17. The Owner hereby represents to and for the benefit of the
transferor that (i) at the time of the transfer, and at the close of each of the
Owners's two fiscal years preceding the year of transfer, the Owners's gross
assets for financial reporting purposes exceed $100 million and its net assets
for such purposes exceed $10 million (disregarding, for purposes of determining
gross or net assets, the obligation of any person related to the Owner within
the meaning of section 860L(g) of the Code or any other asset if a principal
purpose for holding or acquiring that asset is to permit the Owner to satisfy
this minimum gross asset or net asset requirement), (ii) the Owner is a domestic
C corporation for United States federal income tax purposes that is not for such
purposes an exempt corporation, a regulated investment company, a real estate
investment trust, a REMIC, or a cooperative organization to which part I of
subchapter T of the Code applies, (iii) there are no facts or circumstances on
or before the date of transfer (or anticipated) which would reasonably indicate
------------------------
Prospectus Supplement.
that the taxes associated with the Class R Certificate will not be paid, and
(iv) the Owner is not a foreign branch of a domestic corporation, the transfer
does not involve a transfer or assignment to a foreign branch of a domestic
corporation (or any other arrangement by which any Class R Certificate is at any
time subject to net tax by a foreign country or U.S. possession), and the Owner
will not hereafter engage in any such transfer or assignment (or any such
arrangement).]2/
IN WITNESS WHEREOF, the Owner has caused this instrument to be executed
on its behalf, pursuant to the authority of its Board of Directors, by its
[Title of Officer] and its corporate seal to be hereunto attached, attested by
its [Assistant] Secretary, this day of , 20 .
[Name of Owner]
By: ________________________________
[Name of Officer]
[Title of Officer]
[Corporate Seal]
ATTEST:
[Assistant] Secretary
-------------------------
2/ text to be included if the Owner is relying on the transferee's compliance
with the "Asset Test Safe Harbor" (which is generally described as the second
"safe harbor" in the Prospectus Supplement) rather than the "Formula Test Safe
Harbor" (which is generally described as the first "safe harbor" in the
Prospectus Supplement). See "Federal Income Tax Consequences--Special Tax
Considerations Applicable to the Residual Certificate" in the Prospectus
Supplement.
Personally appeared before me the above-named [Name of Officer], known
or proved to me to be the same person who executed the foregoing instrument and
to be the [Title of Officer] of the Owner, and Acknowledged to me that he
executed the same as his free act and deed and free act and deed of the Owner.
Subscribed and sworn before me this _____ day of ___________, 20___.
NOTARY PUBLIC
COUNTY OF
STATE OF
My Commission expires the day
of , 20
EXHIBIT K
---------
FORM OF ADDITIONAL MATTER INCORPORATED
INTO THE FORM OF THE CERTIFICATES
This Certificate does not represent an obligation of or interest in ABN
AMRO Mortgage Corporation or any of its affiliates. Neither this Certificate nor
the underlying Loans are guaranteed by any agency or instrumentality of the
United States.
This certifies that the above-mentioned Registered Owner is the
registered owner of certain interests in a trust fund (the "Certificate Trust
Fund") whose assets consist of, among other things, a pool (the "Mortgage Pool")
of conventional one- to four-family mortgage loans (the "Loans"), formed by ABN
AMRO Mortgage Corporation (the "Depositor"). The Loans were originated or
acquired by various financial institutions and subsequently acquired by the
Depositor. The Mortgage Pool was created pursuant to a Pooling and Servicing
Agreement, dated as of the Cut-Off Date stated above (the "Pooling Agreement"),
between the Depositor, ABN AMRO Mortgage Group, Inc., as a servicer ("AAMG"),
Washington Mutual Mortgage Securities Corp. as a servicer ("WMMSC" and together
with AAMG, the "Servicers"), and JPMorgan Chase Bank, as Trustee (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 Pooling Agreement. Nothing herein shall
be deemed inconsistent with such meanings, and in the event of any conflict
between the Pooling Agreement and the terms of this Certificate, the Pooling
Agreement shall control. This Certificate is issued under and is subject to the
terms, provisions and conditions of the Pooling Agreement, to which Pooling
Agreement the Holder of this Certificate, by virtue of the acceptance hereof,
assents and by which such Holder is bound.
Distributions will be made, pursuant to the Pooling Agreement, on the
25th day of each month or, if such 25th day is not a Business Day, the Business
Day immediately following (the "Distribution Date"), commencing on the first
Distribution Date specified above, to the Person in whose name this Certificate
is registered at the close of business on the last Business Day of the month
immediately preceding the month of such distribution (the "Record Date"), to the
extent of such Certificateholder's Percentage Interest represented by this
Certificate in the portion of the Certificate Distribution Amount for such
Distribution Date then distributable on the Certificates of this Class, as
specified in Section 4.1 of the Pooling Agreement.
Distributions on this Certificate will be made by the Trustee or its
Paying Agent by wire transfer or by other means of payment acceptable to each
Certificateholder of record on the immediately preceding Record Date.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee or its Paying Agent of the pendency of such
distribution and only upon presentation and surrender of this Certificate to the
Certificate Registrar.
Reference is hereby made to the further provisions of this Certificate
set forth below, which further provisions shall for all purposes have the same
effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by or
on behalf of the Trustee, by manual signature, this Certificate shall not be
entitled to any benefit under the Pooling Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
JPMORGAN CHASE BANK, as Trustee
By: _______________________________
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Pooling Agreement.
JPMORGAN CHASE BANK, as Trustee
By: ____________________________
Dated:
ABN AMRO MORTGAGE CORPORATION
MORTGAGE PASS-THROUGH CERTIFICATE
This Certificate is one of a duly authorized issue of Certificates
designated as Mortgage Pass-Through Certificates of the Series and Class
specified hereon (herein called the "Certificates") and representing certain
interests in the Certificate Trust Fund.
The Certificates do not represent an obligation of, or an interest in,
the Depositor or any of its affiliates and are not insured or guaranteed by any
governmental agency. The Certificates are limited in right of payment to certain
collections and recoveries respecting the Loans, all as more specifically set
forth herein and in the Pooling Agreement. To the extent described in the
Pooling Agreement, the related Servicer is obligated to advance its own funds to
cover certain shortfalls with respect to payments on the related Loans. In the
event Servicer funds are advanced with respect to any Loan, such advance is
reimbursable to the related Servicer from the related recoveries on such Loan or
from other cash deposited in the Custodial Account for P&I to the extent that
such advance is not otherwise recoverable.
As provided in the Pooling Agreement, withdrawals from the Custodial
Account for P&I may be made by the related Servicer from time to time for
purposes other than distributions to Certificateholders, such purposes including
reimbursement to such Servicer of advances made, or certain expenses incurred,
by it.
The Pooling Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor and the applicable Servicer, and the rights of the
Certificateholders under the Pooling Agreement at any time by the Depositor and
the Trustee, with the consent of the Holders of the Certificates aggregating not
less than 66-2/3% of the aggregate Percentage Interest evidenced by all of the
Certificates of the Trust Fund. For the purposes of such provision and except as
provided below, voting rights related to 100% of the Aggregate Certificate
Principal Balance of any Class will be allocated pro rata (by Certificate
Principal Balance) among the Certificates of such Class. 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 hereof or in lieu hereof whether or not
notation of such consent is made upon this Certificate. The Pooling 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 Pooling 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 of the Certificate Registrar or the office maintained by
the Trustee in the City and State of New York, duly endorsed by, or accompanied
by an assignment in the form below or other written instrument of transfer in
form satisfactory to the Trustee or any Authenticating Agent duly executed by,
the Holder hereof or such Holder's attorney duly authorized in writing, and
thereupon one or more new Certificates of Authorized Denominations evidencing
the same Percentage Interest set forth hereinabove will be issued to the
designated transferee or transferees.
No transfer of a Certificate will be made unless such transfer is
exempt from or is made in accordance with the registration requirements of the
Securities Act of 1933, as amended (the "Securities Act") and any applicable
state securities laws. No transfer, sale, pledge or other disposition of a
Junior Subordinate Certificate shall be made unless such transfer, sale, pledge
or other disposition is made in accordance with Section 5.1(e) or Section 5.1(f)
of the Pooling Agreement. Each Person who, at any time, acquires any ownership
interest in any Junior Subordinate Certificate shall be deemed by the acceptance
or acquisition of such ownership interest to have agreed to be bound by the
provisions of such Section 5.1(e) and Section 5.1(f), as applicable. No transfer
of a Junior Subordinate Certificate shall be deemed to be made in accordance
with such Section 5.1(e) unless such transfer is made pursuant to an effective
registration statement under the Securities Act or unless the Trustee and the
Certificate Registrar are provided with the certificates and an Opinion of
Counsel, if required, on which the Trustee and the Certificate Registrar may
conclusively rely, which establishes or establish to the Trustee's and the
Certificate Registrar's satisfaction that such transfer is exempt from the
registration requirements under the Securities Act, as follows: In the event
that a transfer is to be made in reliance upon an exemption from the Securities
Act, the Trustee and the Certificate Registrar shall require, in order to assure
compliance with the Securities Act, that the Certificateholder desiring to
effect such transfer certify to the Trustee and the Certificate Registrar in
writing, in substantially the form attached as Exhibit F to the Pooling
Agreement, the facts surrounding the transfer, with such modifications to such
Exhibit F as may be appropriate to reflect the actual facts of the proposed
transfer, and that the Certificateholder's proposed transferee certify to the
Trustee and the Certificate Registrar in writing, in substantially the form
attached as Exhibit G to the Pooling Agreement, the facts surrounding the
transfer, with such modifications to such Exhibit G as may be appropriate to
reflect the actual facts of the proposed transfer. If such certificate of the
proposed transferee does not contain substantially the substance of Exhibit G,
the Trustee and the Certificate Registrar shall require an Opinion of Counsel
satisfactory to it that such transfer may be made without registration, which
Opinion of Counsel shall not be obtained at the expense of the Trustee, the
Certificate Registrar, the Trust Fund or the Depositor.
Transfers of the Junior Subordinate Certificates may also be made in
accordance with Section 5.1(f) of the Pooling Agreement. To effectuate a
Certificate transfer in accordance with such Section 5.1(f), the proposed
transferee of such Certificate must provide the Trustee, the Certificate
Registrar and the Depositor with an investment letter substantially in the form
of Exhibit L attached to the Pooling Agreement, which investment letter shall
not be an expense of the Trustee, the Certificate Registrar or the Depositor,
and which investment letter states that, among other things, such transferee (i)
is a "qualified institutional buyer" as defined under Rule 144A, acting for its
own account or the accounts of other "qualified institutional buyers" as defined
under Rule 144A, and (ii) is aware that the proposed transferor intends to rely
on the exemption from registration requirements under the Securities Act
provided by Rule 144A. Notwithstanding the foregoing, the proposed transferee of
such Certificate shall not be required to provide the Trustee, the Certificate
Registrar or the Depositor with Annex 1 or Annex 2 to the form of such Exhibit L
if the Depositor so consents prior to each such transfer. Such transfers shall
be deemed to have complied with the requirements of Section 5.1(f) of the
Pooling Agreement. The Holder of a Certificate desiring to effect such transfer
does hereby agree to indemnify the Trustee, and the Certificate Registrar, the
Depositor, and the Certificate Registrar against any liability that may result
if transfer is not made in accordance with the Pooling Agreement.
The Certificates are issuable only as registered Certificates without
coupons in Authorized Denominations specified in the Pooling Agreement. As
provided in the Pooling Agreement and subject to certain limitations therein set
forth, Certificates are exchangeable for new Certificates of Authorized
Denominations evidencing the same aggregate interest in the portion of the
Available Distribution Amount distributable on this Class of Certificate, as
requested by the Holder surrendering the same.
A reasonable service charge may be made for any such registration of
transfer or exchange, and the Trustee or the Certificate Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith.
The Depositor, the Certificate Registrar, the Certificate
Administrator, the Servicers, the Trustee and any agent of any of them may treat
the Person in whose name this Certificate is registered as the owner hereof for
all purposes, and neither the Depositor, the Certificate Registrar, the
Certificate Administrator, the Servicers, the Trustee nor any such agent shall
be affected by notice to the contrary.
The respective obligations and responsibilities of the Servicers and
the Trustee created under the Pooling Agreement (other than the obligation to
make payments to Certificateholders as set forth therein) shall terminate upon
the earlier of (i) the later of the final payment or other liquidation (or any
Advance with respect thereto) of the last Loan remaining in the Trust Fund and
the disposition of all property acquired in respect of any Loan or (ii) the
purchase by a Servicer of all related Loans at a price established pursuant to
the Pooling Agreement; provided, however, that in no event shall the trust
created hereby continue beyond 21 years from the death of the survivor of
certain persons identified in the Pooling Agreement.
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sell(s) and assign(s) and
transfer(s) unto
(Please print or typewrite name and address, including postal zip code
of assignee. Please insert social security or other identifying number of
assignee.) _____________________________________________________________________
________________________________________________________________________________
the within Mortgage Pass-Through Certificate and hereby irrevocably constitutes
and appoints ___________________________ Attorney to transfer said Certificate
on the Certificate Register, with full power of substitution in the premises.
Dated:___________________ ___________________________________________
Signature Guaranteed
NOTICE:
The signature to this assignment must correspond with the name as
written upon the face of the within instrument in every particular, without
alteration or enlargement or any change whatever.
EXHIBIT L
---------
FORM OF RULE 144A INVESTMENT REPRESENTATION
Description of Rule 144A Securities, including numbers:
___________________________
___________________________
___________________________
The undersigned seller, as registered holder (the "Seller"), intends to transfer
the Rule 144A Securities described above to the undersigned buyer (the "Buyer").
1. In connection with such transfer and in accordance with the
agreements pursuant to which the Rule 144A Securities were issued, the Seller
hereby certifies the following facts: Neither the Seller nor anyone acting on
its behalf has offered, transferred, pledged, sold or otherwise disposed of the
Rule 144A Securities, any interest in the Rule 144A Securities or any other
similar security to, or solicited any offer to buy or accept a transfer, pledge
or any disposition of the Rule 144A Securities, any interest in the Rule 144A
Securities or any other similar security from, or otherwise approached or
negotiated with respect to the Rule 144A Securities, any interest in the Rule
144A Securities 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
Rule 144A Securities under the Securities Act of 1933, as amended (the "1933
Act"), or that would render the disposition of the Rule 144A Securities in
violation of Section 5 of the 1933 Act or require registration pursuant thereto,
and that the Seller has not offered the Rule 144A Securities to any person other
than the Buyer or another "qualified institutional buyer" as defined in Rule
144A under the 0000 Xxx.
2. The Buyer warrants and represents to, and covenants with, the
Seller, the Trustee, the Certificate Registrar and the Servicers (as defined in
the Pooling and Servicing Agreement (the "Agreement") dated as of May 1, 2003
between ABN AMRO Mortgage Corporation, as Depositor, ABN AMRO Mortgage Group,
Inc., as a servicer ("AAMG"), Washington Mutual Mortgage Securities Corp. as a
servicer ("WMMSC" and together with AAMG, the "Servicers"), and JPMorgan Chase
Bank, as Trustee) pursuant to Section 5.1(f) of the Agreement, as follows:
(a) The Buyer understands that the Rule 144A Securities have not been
registered under the 1933 Act or the securities laws of any state.
(b) The Buyer considers itself a substantial, sophisticated
institutional investor having such knowledge and experience in financial and
business matters that it is capable of evaluating the merits and risks of
investment in the Rule 144A Securities.
(c) The Buyer has received and reviewed the Private Placement
Memorandum dated as of May 28, 2003 relating to the Rule 144A Securities and has
been furnished with all information regarding the Rule 144A Securities that it
has requested from the Seller, the Trustee, the Depositor or the Servicers.
(d) Neither the Buyer nor anyone acting on its behalf has offered,
transferred, pledged, sold or otherwise disposed of the Rule 144A Securities,
any interest in the Rule 144A Securities or any other similar security to, or
solicited any offer to buy or accept a transfer, pledge or other disposition of
the Rule 144A Securities, any interest in the Rule 144A Securities or any other
similar security from, or otherwise approached or negotiated with respect to the
Rule 144A Securities, any interest in the Rule 144A Securities 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 Rule 144A
Securities under the 1933 Act or that would render the disposition of the Rule
144A Securities a violation of Section 5 of the 1933 Act or require registration
pursuant thereto, nor will it act, nor has it authorized or will it authorize
any person to act, in such manner with respect to the Rule 144A Securities.
(e) The Buyer is a "qualified institutional buyer" as that term is
defined in Rule 144A under the 1933 Act and has (1) completed either of the
forms of certification to that effect attached hereto as Annex 1 or Annex 2, or
(2) obtained the waiver of the Depositor with respect to Annex 1 and Annex 2
pursuant to Section 5.1(f) of the Agreement. The Buyer is aware that the sale to
it is being made in reliance on Rule 144A. The Buyer is acquiring the Rule 144A
Securities for its own account or the accounts of other qualified institutional
buyers, understands that such Rule 144A Securities 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 1933 Act.
(f) The Buyer is not affiliated with (i) the Trustee or (ii) any Rating
Agency that rated the Rule 144A Securities.
(g) If applicable, the Buyer has complied, and will continue to comply,
with the guidelines established by Thrift Bulletin 12 issued December 13, 1988,
by the Office of Regulatory Activities of the Federal Home Loan Bank System.
[Required only in the case of a transfer of a Class B-3, Class B-4 and
Class B-5 Certificate][3. The Buyer warrants and represents to, and covenants
with, the Seller, the Servicers, the Certificate Registrar and the Depositor
that (1) the Buyer is not an employee benefit plan (within the meaning of
Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA")), subject to the prohibited transaction provisions of ERISA ("Plan"),
or a plan (within the meaning of Section 4975(e)(1) of the Internal Revenue Code
of 1986 ("Code")) subject to Section 4975 of the Code (also a "Plan"), and the
Buyer is not directly or indirectly purchasing the Rule 144A Securities on
behalf of, as investment manager of, as named fiduciary of, as trustee of, or
with "plan assets" of any Plan, or (2) the Buyer has provided the Seller, the
Servicers, the Certificate Registrar and the Depositor with an Officer's
Certificate signed by a Responsible Officer of the Buyer stating that the Buyer
is an insurance company using assets of an "insurance company general account"
(within the meaning of Department of Labor Prohibited Transaction Class
Exemption ("PTCE") 95-60) to effect such purchase and is eligible for, and
satisfies all of the requirements for exemptive relief under Sections I and III
of PTCE 95-60, which Officer's Certificate shall not be an expense of the
Trustee, Certificate Administrator, Certificate Registrar, Servicers or
Depositor.]
3. This document may be executed in one or more counterparts and by the
different parties hereto on separate counterparts, each of which, when so
executed, shall be deemed to be an original; such counterparts, together, shall
constitute one and the same document.
IN WITNESS WHEREOF, each of the parties has executed this document as
of the date set forth below.
_______________________________ _______________________________
Print Name of Seller Print Name of Seller
By:____________________________ By: ___________________________
Name: Name:
Title: Title:
Taxpayer Identification Taxpayer Identification
No.: No.:
Date: Date:
Annex 1 to Exhibit L
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Buyers Other Than Registered Investment Companies]
The undersigned hereby certifies as follows in connection with the Rule
144A Investment Representation to which this Certification is attached:
1. As indicated below, the undersigned is the President, Chief
Financial Officer, Senior Vice-President or other executive officer of the
Buyer.
2. 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 ("Rule 144A") because (i) the Buyer owned and/or invested on a
discretionary basis $_________________3/ 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.
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.
Broker-Dealer. The Buyer is a dealer registered pursuant to Section 15
of the Securities Exchange Act of 1934.
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
-------------------
3/Buyer must own and/or invest on a discretionary basis at least $100,000,000 in
securities unless Buyer is a dealer, and, in that case, Buyer must own and/or
invest on a discretionary basis at least $10,000,000 in securities.
companies and which is subject to supervision by the insurance commissioner or a
similar official or agency of a State or 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
Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA") and is subject to the fiduciary responsibility provisions of ERISA.
Investment Adviser. The Buyer is an investment adviser registered under
the Investment Advisers Act of 1940.
SBIC. The 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. The Buyer is a business development
company as defined in Section 202(a)(22) of the Investment Advisers Act of 1940.
Trust Fund. The Buyer is a trust fund whose trustee is a bank or trust
company and whose participants are exclusively (a) plans established and
maintained by a State, its political subdivision, or any agency or
instrumentality of the State or its political subdivision, for the benefit of
its employees, or (b) employee benefit plans within the meaning of Title I of
the Employee Retirement Income Security Act of 1974, but is not a trust fund
that includes as participants individual retirement accounts or H.R. 10 plans.
3. 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) 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.
4. 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. 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.
5. 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.
_____ _____ Will the Buyer be purchasing the Rule 144A
Yes No Securities only for the Buyer's own account?
6. If the answer to the foregoing question is "no", the Buyer agrees
that, in connection with any purchase of securities sold to the Buyer for the
account of a third party (including any separate account) in reliance on Rule
144A, the Buyer will only purchase for the account of a third party that at the
time is a "qualified institutional buyer" within the meaning of Rule 144A. In
addition, the Buyer agrees that the Buyer will not purchase securities for a
third party unless the Buyer has obtained a current representation letter from
such third party or taken other appropriate steps contemplated by Rule 144A to
conclude that such third party independently meets the definition of "qualified
institutional buyer" set forth in Rule 144A.
7. 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 Rule 144A Securities will
constitute a reaffirmation of this certification as of the date of such
purchase.
Print Name of Buyer
By: ______________________________
Name:
Title:
Date:
Annex 2 to Exhibit L
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Buyers That Are Registered Investment Companies]
The undersigned hereby certifies as follows in connection with the Rule
144A Investment Representation to which this Certification is attached:
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 ("Rule 144A") because Buyer is a part of a Family of
Investment Companies (as defined below), is such an officer 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, 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.
____ 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 in 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) bank deposit notes and certificates of deposit,
(iii) loan participations, (iv) repurchase agreements, (v) securities owned but
subject to a repurchase agreement and (vi) currency, interest rate and commodity
swaps.
5. The Buyer is familiar with Rule 144A and understands that each of
the parties to which this certification is made are relying and will continue to
rely on the statements made herein because one or more sales to the Buyer will
be reliance on Rule 144A. In addition, the Buyer will only purchase for the
Buyer's own account.
6. The undersigned will notify each of the parties to which this
certification is made of any changes in the information and conclusions herein.
Until such notice, the Buyer's purchase of Rule 144A Securities will constitute
a reaffirmation of this certification by the undersigned as of the date of such
purchase.
Print Name of Buyer
By: ____________________________________
Name:
Title:
Date:
IF AN ADVISER
Print Name of Buyer
By: ____________________________________
Name:
Title:
Date:
(SEAL)
EXHIBIT M
---------
AGGREGATE PLANNED PRINCIPAL BALANCES
EXHIBIT N
---------
TARGETED PRINCIPAL BALANCES
EXHIBIT O
---------
[RESERVED]
EXHIBIT P
---------
[RESERVED]
EXHIBIT Q
---------
BLOOMBERG DATA
Loan Number
Property Type
Owner Occupied
Loan Purpose
Loan Type
Loan Group
Current Interest Rate
Original Balance
Current Balance
First Payment Date
Maturity Date
Current PNI
Servicing Fee
Loan Term
Foreclosure/REO
Loan to Value Ratio
State Code
Interest Paid to Date
Zip Code
PIF Data
Amortized Remaining Term
EXHIBIT R
---------
FORM OF SPECIAL SERVICING AGREEMENT
This SPECIAL SERVICING AGREEMENT (the "Agreement") is made and entered
into as of ____________ 1, 20__, between _______________, as seller and master
servicer (the "Company"), _______________, as holder of the Class B Certificates
identified on Schedule I (the "Class B Holder") and _______________, [an
affiliate of the Class B Holder,] as special servicer (the "Special Servicer").
PRELIMINARY STATEMENT
---------------------
WHEREAS, the Class B Holder is the holder of at least 75% of each the
classes of Mortgage Pass-Through Certificates (each a "Class B Certificate") of
the series of issuances (each a "Series") issued by the Company identified on
Schedule I attached hereto (such Schedule I, as may be modified or amended to
reflect (i) the purchase from time to time by the Class B Holder of interests in
any class of Class B Certificates of a Series such that the Class B Holder owns
not less than 75% of the then outstanding Certificate Principal Balance of such
Class B Certificates and (ii) the sale from time to time of the Class B Holder
of interests in any class of Class B Certificates of a Series such that the
Class B Holder owns less than 75% of the then outstanding Certificate Principal
Balance of such Class B Certificates, the "Schedule I").
WHEREAS, each of the Class B Certificates was issued by the Company
pursuant to the Pooling and Servicing Agreement or Agreements (each a "Pooling
and Servicing Agreement") identified on Schedule I and evidences an ownership
interest in a pool of Mortgage Loans.
WHEREAS, the Company is the Master Servicer of the Mortgage Loans
related to each Series and the Mortgage Loans are serviced in accordance with
the applicable Pooling and Servicing Agreement [and the Company's [Servicer
Guide] (the "Servicer Guide")].
WHEREAS, in connection with the purchase by Class B Holder of a Series
of Class B Certificates (whether owned by the Class B Holder on the date hereof
or purchased by the Class B Holder at any time in the future), the Class B
Holder and the Company have agreed that (i) the Class B Holder, if it owns 75%
of the most subordinate outstanding class of Class B Certificates of a Series
(calculated by dividing the then outstanding Certificate Principal Balance of
such Class B Certificates by the then outstanding Certificate Principal Balance
of all certificates of the same class) may elect to have certain Mortgage Loans
with respect to the related Series that become 90 or more days delinquent (each
such Mortgage Loan, a "Delinquent Mortgage Loan") serviced by the Special
Servicer (each such Delinquent Mortgage Loan, a "Specially Serviced Mortgage
Loan"), and (ii) with respect to Delinquent Mortgage Loans other than Specially
Serviced Mortgage Loans, the Company will provide to the Class B Holder such
information as is generated [pursuant to the terms of the Servicer Guide] by the
Company or a subservicer with respect to such Delinquent Loan.
NOW THEREFORE, in consideration of the premises and mutual agreements
hereinafter set forth, the Company, the Class B Holder and the Special Servicer
hereby agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01 Definitions Incorporated by Reference.
Capitalized terms used but not otherwise defined in this Agreement
shall have the respective meaning ascribed thereto as set forth in the related
Pooling and Servicing Agreement [or the Servicer Guide, as the context may
require].
ARTICLE II
DESIGNATION OF SPECIALLY SERVICED MORTGAGE LOANS AND SPECIAL
SERVICING PROCEDURES
Section 2.01 [Approval of _______________ as an Approved Servicer under
the Servicer Guide.
The Company hereby approves _______________ as an approved servicer for
all purposes under the terms of the Servicer Guide.]
Section 2.02 Specially Serviced Mortgage Loans.
To the extent and for so long as the Class B Certificates of a Series
are outstanding and the Class B Holder owns at least 75% of the most subordinate
outstanding class of the Class B Certificates of such Series (calculated by
dividing the then outstanding Certificate Principal Balance of such Class B
Certificates by the then outstanding Certificate Principal Balance of all
certificates of the same class), Delinquent Mortgage Loans of the related Series
may, at the option of the Class B Holder, be designated in writing by the Class
B Holder as Specially Serviced Mortgage Loans and transferred to the Special
Servicer for servicing. The Special Servicer shall service the Specially
Serviced Mortgage Loans in accordance with the terms of the related Pooling and
Servicing Agreement [and the Servicer Guide].
Following the designation of a Delinquent Mortgage Loan as a Specially
Serviced Loan, the Company shall transfer servicing of such Delinquent Mortgage
Loan to the Special Servicer substantially in the manner set forth herein and in
Schedule II hereto. [The parties hereto agree that any fees resulting from the
transfer of the servicing of a Delinquent Mortgage Loan from the Company or a
subservicer to the Special Servicer (or any successor thereto) shall be the
obligation of the Company.]
As of the Effective Date (as defined below) of each Specially Serviced
Mortgage Loan, the Special Servicer shall succeed to and undertake all rights,
duties and obligations of the prior servicer (including, without limitation, the
making of advances, any right to purchase such Specially Serviced Mortgage Loan
at the purchase price set forth in the related Pooling and Servicing Agreement
and the right to receive the servicing fee with respect to such Specially
Serviced Mortgage Loan)
pursuant to and in accordance with the terms of the related Pooling and
Servicing Agreement [and the terms and conditions of the Servicer Guide].
With respect to each Specially Serviced Mortgage Loan, the effective
date (the "Effective Date") shall be the first day of the month immediately
following the month of designation of such Specially Serviced Mortgage Loan as
such, provided that such written designation is received by the Company on or
prior to the 15th calendar day of such month.
Once a Delinquent Mortgage Loan becomes a Specially Serviced Mortgage
Loan, such Delinquent Mortgage Loan shall remain a Specially Serviced Mortgage
Loan, and shall continue to be serviced by the Special Servicer, until the
earlier of the liquidation or other disposition of such Specially Serviced
Mortgage Loan or the termination of this Agreement, regardless of delinquency
status, whether the related Mortgaged Property becomes an REO Property or
otherwise; provided, however, that if the Company exercises its right as Master
Servicer to purchase all of the Mortgage Loans in a Trust Fund pursuant to an
optional termination provision under the related Pooling and Servicing
Agreement, the servicing of any related Specially Serviced Mortgage Loans with
respect to which foreclosure proceedings have not been commenced shall be
transferred promptly by the Special Servicer in accordance with written
instructions from the Company.
If the Class B Holder (i) transfers such percentage interest in any
Class B Certificates of a Series such that the Class B Holder owns less than 75%
of the then outstanding Certificate Principal Balance of such class, or (ii)
purchases such percentage interest in any Class B Certificates of a Series such
that the Class B Holder owns 75% or more of the then outstanding Certificate
Principal Balance of such class, the Class B Holder shall promptly notify the
Company and the Special Servicer in writing of any such transfer or acquisition.
Upon receipt of written notice from the Class B Holder, the Company or the Class
B Holder shall revise Schedule I hereto to reflect any such transfer or
acquisition and shall forward promptly a copy of such revised schedule to the
Company or the Class B Holder, as applicable, and the Special Servicer. With
respect to the purchase of at least 75% of the Class B Certificates of any
Series by the Class B Holder after the date hereof, this Agreement shall be
effective as of the date such written notice of acquisition is received by the
Company.
If and to the extent the Company is permitted to purchase Delinquent
Mortgage Loans under the related Pooling and Servicing Agreement, the Class B
Holder may direct the Company to purchase any Specially Serviced Mortgage Loan
and to promptly resell such Mortgage Loan to the Class B Holder at the price and
on the terms set forth in such Pooling and Servicing Agreement. In the event the
Class B Holder directs the Company to purchase a Specially Serviced Mortgage
Loan as permitted under this Section, the Company shall promptly take all action
necessary under the terms of the related Pooling and Servicing Agreement in
order to accomplish such purchase (i.e. provide notification to the Trustee
and/or Custodian) and to resell such Specially Serviced Mortgage Loan to the
Class B Holder. The Class B Holder, and not the Company, shall be required to
remit the purchase price for such Specially Serviced Mortgage Loan to the
related Trustee. The Company will inform the Trustee in writing of the purchase
of such Specially Serviced Mortgage Loan by the Class B Holder and further shall
promptly take all actions necessary or desirable to effect the conveyance of
such Mortgage Loan and the related servicing rights to the Class B Holder or its
designee, time being of the essence.
Notwithstanding any provision herein to the contrary, the Special
Servicer shall (i) in no event be obligated to effect any cure or remedy in
connection with a deficiency in the documentation for any Specially Serviced
Mortgage Loan to the extent such deficiency existed at the time such Mortgage
Loan became a Specially Serviced Mortgage Loan or (ii) have any responsibility
for any obligations, duties, or liabilities of the Company with respect to the
servicing of a Specially Serviced Mortgage Loan that arose prior to the related
Effective Date for such Specially Serviced Mortgage Loan, other than those which
would customarily be assumed after the Effective Date.
Section 2.03 Termination of Special Servicer for Default.
The Company shall have the right, immediately upon written notice, to
terminate the Special Servicer's right and obligation to subservice all of the
Specially Serviced Mortgage Loans hereunder in the event (each such event, an
"Event of Default") of:
(i) any failure by the Special Servicer to remit to the Company for
distribution to the Certificateholders of a Series any payment (including
without limitation, any failure to make any required Advance) required to be
made under the terms of this Agreement or the related Pooling and Servicing
Agreement which continues unremedied for a period of one day after the date upon
which written notice of such failure, requiring the same to be remedied, shall
have been given to the Special Servicer by the Company; or
(ii) any failure on the part of the Special Servicer duly to observe or
perform in any material respect any other of the covenants or agreements on the
part of the Special Sub-Servicer contained in this Agreement (including any
breach of the Special Servicer's representations and warranties contained in
Section 4.03 hereof, which materially and adversely affects the interests of the
Certificateholders of a Series) which continues unremedied for a period of 30
days after the date on which written notice of such failure, requiring the same
to be remedied, shall have been given to the Special Servicer by the Company; or
(iii) a decree or order of a court or agency or supervisory authority
having jurisdiction in an involuntary case under any present or future federal
or state bankruptcy, insolvency or similar law or the appointment of a
conservator or receiver or liquidator in any insolvency, readjustment of debt,
marshalling of assets and liabilities or similar proceedings, or for the
winding-up or liquidation of its affairs, shall have been entered against the
Special Servicer and such decree or order shall have remained in force
undischarged or unstayed for a period of 60 consecutive days; or
(iv) the Special Servicer shall consent to the appointment of a
conservator or receiver or liquidator in any insolvency, readjustment of debt,
marshalling of assets and liabilities or similar proceedings of or relating to
the Special Servicer or of or relating to all or substantially all of its
property; or
(v) the Special Servicer shall admit in writing its inability to pay
its debts generally as they become due, file a petition to take advantage of or
otherwise voluntarily commence a case or proceeding under any applicable
bankruptcy, insolvency, reorganization or other similar statute, make an
assignment for the benefit of its creditors, or voluntarily suspend payment of
its obligations.
If an Event of Default shall occur, then, and in each and every such
case, upon receipt of written notice from the Company, the Special Servicer
shall immediately remit to the Company all amounts in the Collection Accounts
and the Escrow Accounts and all rights of the Special Servicer to service the
Specially Serviced Mortgage Loans shall terminate. Following the receipt of
written notice from the Company as provided above, all authority and power of
the Special Sub-Servicer to subservice all the Specially Serviced Mortgage Loans
shall pass to and be vested in the Company pursuant to and under this Section
2.03, and the Special Servicer shall do all things necessary to effect a
transfer of the servicing rights back to the Company. In this regard, the
Company is hereby authorized and empowered to execute and deliver, on behalf of
the Special Servicer, as attorney-in-fact or otherwise, any and all documents
and other instruments, and to do or accomplish all other acts or things
necessary or appropriate to effect the purposes of such notice of termination,
whether to complete the transfer and endorsement or assignment of the affected
Specially Serviced Mortgage Loans and related documents, or otherwise. The
Special Servicer agrees to cooperate with the Company in implementing the
termination of the Special Servicer's responsibilities and rights hereunder,
including, without limitation, the transfer to the Company or its appointed
agent for administration by it of all amounts in the possession of the Special
Servicer or thereafter be received with respect to the Specially Serviced
Mortgage Loans and the transfer of the] servicing rights back to the Company.
Section 2.04 Appointment of Successor Special Servicer.
The Class B Holder shall have the right, upon 90 days prior written
notice to the Company and the Special Servicer appoint a successor special
servicer having the characteristics set forth in clauses (i), (ii) and (iii)
below, and which shall succeed to all rights and assume all of the
responsibilities, duties and liabilities of the Special Servicer under this
Agreement simultaneously with the termination of the Special Servicer's
responsibilities, duties and liabilities under this Agreement. In the event that
the Special Servicer's duties, responsibilities and liabilities under this
Agreement should be terminated pursuant to the foregoing, the Special Servicer
shall discharge such duties and responsibilities during the period from the date
it acquires knowledge of such termination until the effective date thereof with
the same degree of diligence and prudence which it is obligated to exercise
under this Agreement, and shall take no action whatsoever that might impair or
prejudice the rights or financial condition of its successor. The removal of the
Special Servicer shall not become effective until a successor shall be appointed
pursuant to this Section and shall in no event relieve the Special Servicer of
the representations and warranties made pursuant to Section 4.03 and the
remedies available to the Class B Holder and/or the Company under Sections 4.04
and 5.01, it being understood and agreed that the provisions of such Sections
4.04 and 5.01 shall be applicable to the Special Servicer notwithstanding any
such termination of it, or the termination of this Agreement.
Any successor special servicer shall (i) [be an institution having a
net worth of not less than $1,000,000][meet the eligibility requirements of an
approved servicer under the Company's Servicer Guide], (ii) the appointment of
such successor servicer will not result in the downgrading in any rating by any
applicable rating agency of any security issued in connection with the
applicable Pooling and Servicing Agreements, and (iii) have and keep in full
effect its existence, rights and franchises as a corporation (or such other
corporate form), and shall obtain its qualification to do business as a foreign
corporation (or such other corporate form) in each jurisdiction in which such
qualification is or shall be necessary to protect the validity and
enforceability of this Agreement or any of the Specially Serviced Mortgage Loans
and to perform its duties under this Agreement. Any successor appointed as
provided herein shall execute, acknowledge and deliver to the Class B Holder and
the Company an instrument accepting such appointment, wherein the successor
shall make the representations and warranties set forth in Section 4.03,
whereupon such successor shall become fully vested with all the rights, powers,
duties, responsibilities, obligations and liabilities of the Special Servicer,
with like effect as if originally named as a party to this Agreement.
Within 30 days of the appointment of a successor special servicer by
the Class B Holder, the Special Servicer shall prepare, execute and deliver to
the successor entity any and all documents and other instruments, place in such
successor's possession all servicing files related to the Specially Serviced
Mortgage Loans, and do or cause to be done all other acts or things necessary or
appropriate to effect the purposes of such notice of termination [, including
but not limited to the transfer and endorsement of the related Mortgage Notes
and other documents, and the Class B Holder shall do or cause to be done the
preparation and recordation of Assignments of Mortgage and Deeds at the Class B
Holder's sole expense].
The Special Servicer shall cooperate with the Class B Holder and such
successor in effecting the termination of the Special Servicer's
responsibilities and rights hereunder and the transfer of servicing
responsibilities to the successor special servicer, including without
limitation, the transfer to such successor of all amounts received by it with
respect to the Specially Serviced Mortgage Loans. Further, the Special Servicer
shall execute and deliver such instruments and do such other things as may
reasonably be required to more fully and definitively vest in the successor all
such rights, powers, duties, responsibilities, obligations and liabilities of
the Special Servicer.
ARTICLE III
DELINQUENT MORTGAGE LOANS OTHER THAN SPECIALLY SERVICED
MORTGAGE LOANS
Section 3.01 Reporting of Delinquent Mortgage Loans.
(a) To the extent and for so long as the Class B Certificates of a
Series are outstanding and any interest in such Class B Certificates is held by
the Class B Holder, the Company, as Master Servicer of the Mortgage Loans
related to each Series, hereby agrees to provide to the Class B Holder the
following notices and reports:
Within three (3) Business Days after each Distribution Date (or
included in or with the monthly statements to Certificateholders pursuant to the
related Pooling and Servicing Agreement), the Company shall provide to the Class
B Holder a report, in tape format, containing the following information:
(1) With respect to each Series, the number and aggregate Principal
Balance of the Mortgage Loans delinquent one, two and three months or more,
together with the Principal Balance of each Mortgage Loan delinquent, one, two
and three months or more;
(2) With respect to each Series, the (i) number and aggregate Principal
Balance of Mortgage Loans with respect to which foreclosure proceedings have
been initiated, and (ii) the number and aggregate book value of Mortgaged
Properties acquired through foreclosure, deed in lieu of foreclosure or other
exercise of rights respecting the Trustee's security interest in the Mortgage
Loans, and with respect to each Mortgage Loan, the (i) Principal Balance of each
such Mortgage Loan with respect to which foreclosure proceedings have been
initiated, and (ii) the book value of each Mortgaged Property acquired through
foreclosure, deed in lieu of foreclosure or other exercise of rights respecting
the Trustee's security interest in the related Mortgage Loan; and
(3) With respect to each Series, the amount of Realized Losses
allocable to the Certificates on the related Distribution Date and the
cumulative amount of Realized Losses allocated to such Certificates since the
Cut-off Date, and with respect to each Mortgage Loan, the amount of Realized
Losses attributable to such Mortgage Loan on the related Distribution Date and
the cumulative amount of Realized Losses attributable to such Mortgage Loan
since the Cut-off Date.
In addition, the Company, as Master Servicer of the Mortgage Loans,
shall send, or shall cause the related servicer to send, to the Class B Holder
all other written reports, documentation, instruments, certificates and
correspondences provided by a servicer under the terms of the Servicer Guide
with respect to any Mortgage Loan that becomes sixty (60) days or more
delinquent.
(b) If requested by the Class B Holder, the Company shall make its
servicing personnel available to respond to reasonable inquiries, by phone or in
writing by facsimile, electronic, or overnight mail transmission, in connection
with any Mortgage Loan identified in any report or document provided pursuant to
clause (a) above; provided, that the Company shall only be required to provide
information that is reasonably accessible to its servicing personnel (or its
subservicers).
(c) In addition to the information described above, the Company shall
provide to the Class B Holder such information as the Class B Holder may
reasonably request; provided, however, that the Mortgage Loans are Delinquent
Mortgage Loans or the Mortgaged Property has been foreclosed upon. The Class B
Holder will reimburse the Company for any reasonable out-of-pocket expenses
incurred by it in providing such information.
Section 3.02 Servicing of Delinquent Mortgage Loans.
(a) Prior to the Commencement of Foreclosure of any Mortgage Loan, the
Company shall provide, or cause the related servicer to provide, the Class B
Holder with a notice (sent by telecopier) of such proposed and imminent
foreclosure, stating the loan number and the aggregate amount due under the
Mortgage Note.
For purposes of this Agreement, "Commencement of Foreclosure" shall
mean the first official action required under local law in order to commence
foreclosure proceedings or to schedule a trustee's sale under a deed of trust,
including (i) in the case of a mortgage, any filing or service of process
necessary to commence an action to foreclosure, or (ii) in the case of a deed of
trust, posting, the publishing, filing or delivery of a notice of sale, but not
including in either case (x) any notice of default, notice of intent to
foreclose or sell or any other action prerequisite to the actions specified
in (i) or (ii) above, (y) the acceptance of a deed-in-lieu of foreclosure
(whether in connection with a sale of the related property or otherwise) or (z)
initiation and completion of a short pay-off.
(b) In connection with any Delinquent Mortgage Loan with respect to
which a notice under clause (a) above has been delivered to the Class B Holder,
the Class B Holder shall provide the Company with written direction as to the
action to be taken with respect to such Delinquent Mortgage Loan, including,
without limitation, to proceed with foreclosure, to accept a deed-in-lieu of
foreclosure, to consent to a pre-foreclosure sale of Mortgaged Property at a
loss, or, if permitted under the terms of the related Pooling and Servicing
Agreement, to purchase Delinquent Mortgage Loans. Such written direction must be
received by the Company within two (2) Business Days of transmission of the
notice provided by the Company under clause (a) above. Such two (2) Business Day
period shall be extended for no longer than an additional three (3) Business
Days after the receipt of additional information requested if the Class B Holder
requests additional information related to such Delinquent Mortgage Loan;
provided, however that the Class B Holder will have at least one Business Day to
provide written direction after receipt of any requested additional information.
Any such additional information shall be provided only to the extent it is
obtainable by the Company from existing reports, certificates or statements or
otherwise be reasonably accessible to its servicing personnel (or subservicing
personnel). The Company shall as promptly as practicable carry out, or cause the
relevant servicer to carry out, the instruction of the Class B Holder in the
manner prescribed in such written direction. The Class B Holder agrees that it
has no right to negotiate directly with the Mortgagor during such period.
In the event the Class B Holder fails to provide any written direction
as provided above, the Company may take any such action as would be consistent
with customary servicing practices of prudent mortgage loan servicers and the
Company's normal policies and practice.
(c) With respect to any Delinquent Mortgage Loan for which the Company
has not provided a notice as contemplated in clause (a) above, the Class B
Holder may, at any time, provide the Company with written direction as to the
action to be taken with respect to such Delinquent Mortgage Loan, including,
without limitation, to commence foreclosure proceedings, to accept a
deed-in-lieu of foreclosure, to consent to a sale of Mortgaged Property at a
loss, or, if permitted under the terms of the related Pooling and Servicing
Agreement, to purchase Delinquent Mortgage Loans. To the extent such action is
not inconsistent with the terms of the related Pooling and Servicing Agreement
or the Company's duties thereunder as master servicer, the Company shall as
promptly as practicable carry out, or cause the relevant servicer to carry out,
the instruction of the Class B Holder in the manner prescribed in such written
direction.
(d) Any foreclosure of a Delinquent Mortgage Loan that has been
initiated in accordance with clauses (b) or (c) above may be discontinued if (i)
the Mortgage Loan has been brought current or if a refinancing or prepayment
occurs with respect to the Mortgage Loan (including by means of a short payoff
approved by the Class B Holder), (ii) the Company has agreed to the terms of a
forbearance agreement with the Mortgagor and such forbearance agreement has been
approved by the Class B Holder, or (iii) if and to the extent permitted under
the related Pooling and Servicing Agreement, Class B Holder directs the Company
to purchase such Delinquent Mortgage Loan at the price and on the terms set
forth in the related Pooling and Servicing Agreement.
(e) In the event the Class B Holder directs the Company to purchase a
Delinquent Mortgage Loan as permitted under Sections 2.02 and 3.02 (b), (c) and
(d), the Class B Holder may direct the Company to purchase any Delinquent
Mortgage Loan and to promptly resell such Mortgage Loan to the Class B Holder at
the price and on the terms set forth in the applicable Pooling and Servicing
Agreement. In the event the Class B Holder directs the Company to purchase a
Delinquent Mortgage Loan as permitted under this Section, the Company shall
promptly take all action necessary under the terms of the related Pooling and
Servicing Agreement in order to accomplish such purchase (i.e. provide
notification to the Trustee and/or Custodian) and to resell such Delinquent
Mortgage Loan to the Class B Holder. The Class B Holder, and not the Company,
shall be required to remit the purchase price for such Delinquent Mortgage Loan
to the related Trustee. The Company will inform the Trustee in writing of the
purchase of such Delinquent Mortgage Loan by the Class B Holder and further
shall promptly take all actions necessary or desirable to effect the conveyance
of such Mortgage Loan and the related servicing rights to the Class B Holder or
its designee, time being of the essence. [The parties hereto agree that, in
connection with a purchase of a Delinquent Mortgage Loan as provided above, any
fees resulting from the transfer of the servicing of such purchased Delinquent
Mortgage Loan from the Company or a subservicer to a servicer designated by the
Class B Holder shall be the obligation of the Company.]
Section 3.03 Review of the Company's Procedures.
The Company and the Class B Holder hereby agree that the Class B Holder
shall have the right, at its own expense and during normal business hours, to
review any and all of the books, records, or other information of the Company
which may be relevant to the Company's direct collection, loss mitigation
foreclosure and REO management procedures currently in place in order to confirm
that the procedures used by the Company and its subservicers are in accordance
with the customary servicing practices of prudent mortgage loan servicers. In
order to discuss such books, records or other information, the Company shall
make personnel available who are knowledgeable about such matters.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Section 4.01 Organizational and Other Related Warranties of the Class B
Holder. The Class B Holder hereby makes the following representations and
warranties to the Company and the Special Servicer:
(i) Organization and Good Standing. The Class B Holder is an entity
duly organized, validly existing, and in good standing under the laws of its
state of incorporation or formation or the laws of the United States.
(ii) No Violation. Neither the execution and delivery by the Class B
Holder of this Agreement, nor the consummation by the Class B Holder of the
transactions contemplated hereby, nor the performance of and compliance by the
Class B Holder with the provisions of this Agreement, will conflict with or
result in a breach or violation of, or constitute a default (or an event which,
with
notice or the lapse of time, or both, would constitute a default) under, the
organizational documents (its articles of incorporation or charter or by-laws)
of the Class B Holder, or any of the provisions of any law, rule, regulation,
judgment, decree, demand, or order (of any federal, state, or local governmental
or regulatory authority or court) binding on the Class B Holder, or any of its
respective properties, or any of the provisions of any indenture, mortgage,
contract, instrument, or other document to which the Class B Holder is a party
or by which it is bound, or result in the creation or imposition of any lien,
charge, or encumbrance upon any of their respective properties pursuant to the
terms of any indenture, mortgage, contract, instrument, or other document. The
Class B Holder is not otherwise in violation of any law, rule, regulation,
judgment, decree, demand, or order (of any federal, state or local governmental
or regulatory authority or court), which violation, in the Class B Holder's,
good faith and reasonable judgment, is likely to affect materially and adversely
its ability to perform its obligations hereunder.
(iii) Authorization and Enforceability. The execution and delivery by
the Class B Holder of this Agreement, the consummation of the transactions
contemplated hereby, and the performance and compliance by the Class B Holder
with the terms hereof are within the powers of the Class B Holder, and have been
duly authorized by all necessary action on the part of the Class B Holder. All
organizational resolutions and consents necessary for the Class B Holder to
enter into and consummate all transactions contemplated hereby have been
obtained. This Agreement has been duly executed and delivered by the Class B
Holder and constitutes the legal, valid and binding obligation of the Class B
Holder, enforceable against it in accordance with its terms, subject to
applicable bankruptcy, insolvency, reorganization, moratorium, and other similar
laws affecting creditors' rights generally, and to general principles of equity,
regardless of whether such enforcement is considered in a proceeding in equity
or at law. The Class B Holder has not failed to obtain any consent, approval,
authorization, or order of, or failed to cause any registration or qualification
with, any court or regulatory authority or other governmental body having
jurisdiction over it, which consent, approval, authorization, order,
registration, or qualification is required for, and the absence of which would
materially adversely affect, the legal and valid execution, delivery, and
performance of this Agreement by the Class B Holder.
(iv) No Litigation or Adverse Conditions. No litigation is pending or,
to the best of the Class B Holder's knowledge, threatened against it, which, if
determined adversely to the Class B Holder would prohibit the Class B Holder
from entering into this Agreement or, in the good faith and reasonable judgment
of the Class B Holder, is likely to materially and adversely affect either the
ability of the Class B Holder to perform its obligations hereunder.
Section 4.02 Organizational and Other Related Warranties of the
Company. The Company hereby makes the following representations and warranties
to the Class B Holder and the Special Servicer:
(i) Organization and Good Standing. The Company is an entity duly
organized, validly existing, and in good standing under the laws of its state of
incorporation or formation or the laws of the United States, and is in
compliance with the laws of each state in which any property is located to the
extent necessary to ensure the enforceability of each Mortgage Loan and to
perform its obligations hereunder and the Pooling and Servicing Agreement.
(ii) No Violation. Neither the execution and delivery by Company of
this Agreement, nor the consummation by it of the transactions contemplated
hereby, nor the performance of and compliance by the Company with the provisions
hereof or of the Pooling and Servicing Agreement, will conflict with or result
in a breach or violation of, or constitute a default (or an event which, with
notice or the lapse of time, or both, would constitute a default) under, the
organizational documents (its articles of incorporation or charter or by-laws)
of the Company, or any of the provisions of any law, rule, regulation, judgment,
decree, demand, or order (of any federal, state, or local governmental or
regulatory authority or court) binding on the Company, or any of its properties,
or any of the provisions of any indenture, mortgage, contract, instrument, or
other document (including, without limitation, any Pooling and Servicing
Agreement) to which the Company is a party or by which it is bound, or result in
the creation or imposition of any lien, charge, or encumbrance upon any of their
respective properties pursuant to the terms of any indenture, mortgage,
contract, instrument, or other document. The Company is not otherwise in
violation of any law, rule, regulation, judgment, decree, demand, or order (of
any federal, state or local governmental or regulatory authority or court),
which violation, in the Company's good faith and reasonable judgment, is likely
to affect materially and adversely either its ability to perform its obligations
hereunder or under the Pooling and Servicing Agreements, or the financial
condition of the Company.
(iii) Authorization and Enforceability. The execution and delivery by
the Company of this Agreement, the consummation of the transactions contemplated
hereby, and the performance and compliance by the Company with the terms hereof
and of the Pooling and Servicing Agreements are within the powers of the
Company, and have been duly authorized by all necessary action on the part of
the Company. All organizational resolutions and consents necessary for the
Company to enter into and consummate all transactions contemplated hereby have
been obtained. This Agreement has been duly executed and delivered by the
Company and constitutes the legal, valid and binding obligation of the Company,
enforceable against it in accordance with its terms, subject to applicable
bankruptcy, insolvency, reorganization, moratorium, and other similar laws
affecting creditors' rights generally, and to general principles of equity,
regardless of whether such enforcement is considered in a proceeding in equity
or at law. The Company has not failed to obtain any consent, approval,
authorization, or order of, or failed to cause any registration or qualification
with, any court or regulatory authority or other governmental body having
jurisdiction over the Company, which consent, approval, authorization, order,
registration, or qualification is required for, and the absence of which would
materially adversely affect, the legal and valid execution, delivery, and
performance of this Agreement by the Company.
(iv) Approvals and Permits. The Company possesses such certificates,
authorizations, licenses, and permits issued by the appropriate state, federal,
and foreign regulatory agencies or bodies necessary to conduct the business now
operated by it, and the Company has not received any notice of proceedings
relating to the revocation or modification of any such certificate,
authorization, or permit which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling, or finding, would materially and adversely affect
the conduct of the business, operations, financial condition, or income of the
Company.
(v) No Litigation or Adverse Conditions. No litigation is pending or,
to the best of the Company's knowledge, threatened against it, which, if
determined adversely to the Company would prohibit the Company from entering
into this Agreement or, in the good faith and reasonable
judgment of the Company, is likely to materially and adversely affect either its
ability to perform its obligations hereunder or under the Pooling and Servicing
Agreements or the financial condition of the Company. The Company has no
knowledge of any recent adverse financial condition or event with respect to
itself that, in its good faith and reasonable judgment, is likely to materially
and adversely affect its ability to perform its obligations hereunder or under
the Pooling and Servicing Agreements.
(vi) Fidelity Bond: Errors and Omission Insurance. Each officer,
director, employee, consultant and advisor of the Company with responsibilities
concerning the servicing and administration of the Mortgage Loans is covered by
errors and omissions insurance and fidelity bond insurance in the amounts and
with the coverage required under the related Pooling and Servicing Agreement for
it to maintain. Neither the Company nor any of its officers, directors,
employees, consultants, or advisors involved in the servicing or administration
of the Mortgage Loans has been refused such coverage or insurance.
Section 4.03 Organizational and Other Related Warranties of the Special
Servicer. The Special Servicer hereby makes the following representations and
warranties to the Company and the Class B Holder:
(i) Organization and Good Standing. The Special Servicer is an entity
duly organized, validly existing, and in good standing under the laws of its
state of incorporation or formation or the laws of the United States, and is in
compliance with the laws of each state in which any property is located to the
extent necessary to ensure the enforceability of each Mortgage Loan and to
perform its obligations hereunder.
(ii) No Violation. Neither the execution and delivery by Special
Servicer of this Agreement, nor the consummation by it of the transactions
contemplated hereby, nor the performance of and compliance by the Special
Servicer with the provisions hereof , will conflict with or result in a breach
or violation of, or constitute a default (or an event which, with notice or the
lapse of time, or both, would constitute a default) under, the organizational
documents (its articles of incorporation or charter or by-laws) of the Special
Servicer, or any of the provisions of any law, rule, regulation, judgment,
decree, demand, or order (of any federal, state, or local governmental or
regulatory authority or court) binding on the Special Servicer, or any of its
properties, or any of the provisions of any indenture, mortgage, contract,
instrument, or other document to which the Special Servicer is a party or by
which it is bound, or result in the creation or imposition of any lien, charge,
or encumbrance upon any of their respective properties pursuant to the terms of
any indenture, mortgage, contract, instrument, or other document. The Special
Servicer is not otherwise in violation of any law, rule, regulation, judgment,
decree, demand, or order (of any federal, state or local governmental or
regulatory authority or court), which violation, in the Special Servicer's good
faith and reasonable judgment, is likely to affect materially and adversely
either its ability to perform its obligations hereunder, or the financial
condition of the Special Servicer.
(iii) Authorization and Enforceability. The execution and delivery by
the Special Servicer of this Agreement, the consummation of the transactions
contemplated hereby, and the performance and compliance by the Special Servicer
with the terms hereof are within the powers of the Special Servicer, and have
been duly authorized by all necessary action on the part of the Special
Servicer.
All organizational resolutions and consents necessary for the Special Servicer
to enter into and consummate all transactions contemplated hereby have been
obtained. This Agreement has been duly executed and delivered by the Special
Servicer and constitutes the legal, valid and binding obligation of the Special
Servicer, enforceable against it in accordance with its terms, subject to
applicable bankruptcy, insolvency, reorganization, moratorium, and other similar
laws affecting creditors' rights generally, and to general principles of equity,
regardless of whether such enforcement is considered in a proceeding in equity
or at law. The Special Servicer has not failed to obtain any consent, approval,
authorization, or order of, or failed to cause any registration or qualification
with, any court or regulatory authority or other governmental body having
jurisdiction over the Special Servicer, which consent, approval, authorization,
order, registration, or qualification is required for, and the absence of which
would materially adversely affect, the legal and valid execution, delivery, and
performance of this Agreement by the Special Servicer.
(iv) Approvals and Permits. The Special Servicer possesses such
certificates, authorizations, licenses, and permits issued by the appropriate
state, federal, and foreign regulatory agencies or bodies necessary to conduct
the business now operated by it, and its has not received any notice of
proceedings relating to the revocation or modification of any such certificate,
authorization, or permit which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling, or finding, would materially and adversely affect
the conduct of the business, operations, financial condition, or income of the
Special Servicer.
(v) No Litigation or Adverse Conditions. No litigation is pending or,
to the best of the Special Servicer's knowledge, threatened against it, which,
if determined adversely to the Special Servicer would prohibit the Special
Servicer from entering into this Agreement or, in the good faith and reasonable
judgment of the Special Servicer, is likely to materially and adversely affect
either its ability to perform its obligations hereunder or the financial
condition of the Special Servicer. The Special Servicer has no knowledge of any
recent adverse financial condition or event with respect to itself that, in its
good faith and reasonable judgment, is likely to materially and adversely affect
its ability to perform its obligations hereunder.
(vi) Fidelity Bond, Errors and Omission Insurance. Each officer,
director, employee, consultant and advisor of the Special Servicer with
responsibilities concerning the servicing and administration of the Mortgage
Loans is covered by errors and omissions insurance and fidelity bond insurance
in the amounts and with the coverage required under the related Pooling and
Servicing Agreement to be maintained by the Company as master servicer. Neither
the Special Servicer nor any of its officers, directors, employees, consultants,
or advisors involved in the servicing or administration of the Mortgage Loans
has been refused such coverage or insurance.
(vii) Approved Seller/Servicer. The Special Servicer is approved as a
seller/servicer of single-family mortgage loans by the Department of Housing and
Urban Development.
Section 4.04 Remedies for Breach of Representation and Warranty.
Upon discovery by any of the Company, the Class B Holder or the Special
Servicer of a breach of any of the representations and warranties contained in
Article IV which materially and
adversely affects the value of the Specially Serviced Mortgage Loans or
Delinquent Mortgage Loans, the party discovering such breach shall give prompt
written notice to the others.
Each of the parties hereto shall indemnify the others and hold each of
them harmless against any losses, damages, penalties, fines, forfeitures,
reasonable and necessary legal fees and related costs, judgments, and other
costs and expenses resulting from any claim, demand, defense or assertion based
on or grounded upon, or resulting from, a breach of such party's representations
and warranties contained in Article IV. It is understood and agreed that the
obligations to indemnify as provided in this Section 4.04 constitute the sole
remedies of each of the Company, Class B Holder and Special Servicer respecting
a breach of any other party's representations and warranties.
ARTICLE V
MISCELLANEOUS PROVISIONS
Section 5.01 Indemnification.
Each of the Company, the Class B Holder and the Special Servicer (each
as such, an "Indemnifying Party") shall indemnify the other parties hereto (each
as such, an "Indemnified Party") and hold them harmless against any and all
claims, losses, damages, penalties, fines, forfeitures, reasonable and necessary
legal fees and related costs, judgments, and any other costs, fees and expenses
(individually and collectively, the "Claims") that such Indemnified Party may
sustain in any way related to the failure of the Indemnifying Party to perform
its duties in compliance with the terms of this Agreement; provided, that none
of the Company, the Class B Holder or the Special Servicer or any of the
directors, officers, employees or agents of the Depositor or the Servicer shall
be liable 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 Company, the Class B Holder
or the Special Servicer against any material breach of warranties,
representations or covenants made herein, or against any specific liability
imposed on such party pursuant hereto, or against any liability which would
otherwise be imposed by reason of willful misfeasance, bad faith or gross
negligence in the performance of duties or by reason of reckless disregard of
obligations and duties hereunder.
Section 5.02 Amendment.
This Agreement may be amended from time to time by written agreement
signed by each of the parties hereto.
Section 5.03 Counterparts.
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 constitute but one and the same instrument.
Section 5.04 Governing Law.
This Agreement shall be construed in accordance with the laws of the
State of New York and the obligations, rights and remedies of the parties
hereunder shall be determined in accordance with such laws.
Section 5.05 Notices.
All demands, notices and direction hereunder shall be in writing or by
telecopy and shall be deemed effective upon receipt to:
(i) in the case of the Company,
Company
Address:_____________________
Attention:___________________
Telephone:___________________
Facsimile:___________________
or such other address as may hereafter be furnished to the Class B
Holder and the Special Servicer in writing.
(ii) in the case of the Class B Holder,
Address:_____________________
Attention:___________________
Telephone:___________________
Facsimile:___________________
or such other address as may hereafter be furnished to the Company in
writing.
(iii) in the case of the Special Servicer,
Address:_____________________
Attention:___________________
Telephone:___________________
Facsimile:___________________
or such other address as may hereafter be furnished to the Company in
writing.
Section 5.06 Termination.
This Agreement shall terminate (i) at such time as the Principal
Balance of the Class B Certificates has been reduced to zero or (ii) if mutually
agreed to by the parties hereto.
Section 5.07 Severability of Provisions.
If any one or more of the covenants, agreements, provisions or terms of
this Agreement shall be held invalid for any reason whatsoever, 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. If the invalidity of any part, provision, representation or warranty
of this Agreement shall deprive any party of the economic benefit intended to be
conferred by this Agreement, the parties shall negotiate in good faith to
develop a structure the economic effect of which is nearly as possible the same
as the economic effect of this Agreement without regard to such invalidity.
Section 5.08 Successors and Assigns.
This Agreement may not be assigned by any party hereto without the
prior written consent of each of the other parties hereto. The provisions of
this Agreement shall be binding upon and inure to the benefit of the respective
successors and assigns of the parties hereto.
Section 5.09 Article and Section Headings.
The article and section headings herein are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
Section 5.10 Confidentiality.
The Class B Holder agrees that all information supplied by or on behalf
of the Company pursuant to Sections 2.02 or 3.01, including individual account
information, is the property of the Company and the Class B Holder agrees to use
such information only for the purposes contemplated by this Agreement and
otherwise hold such information confidential and not to disclose such
information, except to the extent such information is made publicly available by
or on behalf of the Company or the relevant Trustee.
Section 5.11 Publicly Registered Certificates.
The Class B Holder agrees, that without the prior written consent of
the Company, so long as Class B Holder is a party to this Agreement and a holder
of any Class B Certificates of a Series, it will not purchase, sell or trade any
publicly registered Certificates of the same Series.
Section 5.12 No Partnership.
Nothing herein shall be deemed or construed to create a partnership or
joint venture between the parties hereto and the services of the Company shall
be rendered as an independent contractor and not as an agent for the Company.
Section 5.13 Rights of the Class B Holder. Notwithstanding anything
herein to the contrary, it is agreed by the parties hereto that the rights of
the Class B Holder set forth under Article II and Section 3.02(e) of this
Agreement shall relate to, and be exercisable with respect to, the related
Mortgage Loans of any Series to the extent that and for so long as, the Class B
Holder owns at least 75% of the most subordinate outstanding class of Class B
Certificates of the related Series (calculated by dividing the then outstanding
Certificate Principal Balance of such Class B Certificates by the then
outstanding Certificate Principal Balance of all certificates of the same
class).
IN WITNESS WHEREOF, each of the parties hereto have caused its name to
be signed hereto by its respective officer thereunto duly authorized, all as of
the day and year first above written.
COMPANY
By: _____________________________
Name: ___________________________
Title: __________________________
By: _____________________________
Name: ___________________________
Title: __________________________
By: _____________________________
Name: ___________________________
Title: __________________________
SCHEDULE I
Describe each Series of Class B Certificates and the related Pooling and
Servicing Agreement
SCHEDULE II
SPECIAL SERVICING TRANSFER PROCEDURES
Any transfer of servicing with respect to a Specially Serviced Mortgage
Loan shall be effected substantially in accordance with the following example.
All dates set forth below are for illustrative purposes only. Capitalized terms
used in this Exhibit shall have the meanings ascribed thereto in the Agreement.
Timeline
Last Business Day of Month One
Mortgagor is 89 Days Delinquent.
3rd Business Day of Month Two
The Company receives an electronic file from its Collections Department
on all 90+delinquent loans.
4th Business Day of Month Two
The Company sends the electronic file to Class B Holder/Special
Servicer of all 90+ delinquent loans with information designating those loans
where a forbearance plan or workout is in progress and those loans where there
is no plan in place. The Company and the Special Servicer have a discussion. The
loans to be transferred are determined by the Class B Holder/Special Servicer.
6th Business Day of Month Two
The Special Servicer informs the Company of the loans designated as
Specially Serviced Mortgage Loans. The Company and the Special Servicer
coordinate the transfer of servicing of the Specially Serviced Mortgage Loans.
The Company prepares and mails the mortgagor notification no later than the 13th
calendar day of the month. If a loan reinstates to a current or less than 90
days delinquent status before the mortgagor notification (i.e., the "goodbye
letter") is sent, such loan will be removed from the transfer, and the Company
will notify the Special Servicer thereof. The borrower will be instructed to
send the payment due on the effective date of transfer and any past due payments
to the Special Servicer.
7th Business Day of Month Two
Relevant Trustee receives monthly electronic data file from the
Company. The subject loan is included in the Company's report as an active loan
serviced by the Company. The Company reports scheduled P&I on the subject loan.
On or prior to 15th Calendar Day of Month Two
The Company sends a foreclosure referral letter to the Special
Servicer's foreclosure counsel with a corresponding foreclosure package.
18th Calendar Day (or Business day immediately preceding the 18th) of
Month Two
The Company makes its monthly remittance, including advancing scheduled
P&I payment due for current month for the subject loan.
Last business Day of Month Two
Month-end cut-off.
1st Business Day of Month Three
Effective Date.
On or Before 3rd Business Day of Month Three
In accordance with the Servicing Transfer Instructions:
Company sends Special Servicer final transfer data (e.g., trial
balance, loan files, current
and previous 2 years' history records (if applicable), all
default-related correspondence, and all collection, foreclosure and bankruptcy
files);
Company provides Special Servicer with detailed reimbursement request
relating to advances; and
Company sends Special Servicer a check or wire for the net escrow and
unapplied funds.
On or before the 6th Business Day of Month Three
In accordance with the Servicing Transfer Instructions, Special Service
reimburses Company for all outstanding advances, and the scheduled mortgage
payment due on the Effective Date.
___________________
Note:
1. If the loan has been transferred to Special Servicer and it cures,
Special Servicer continues to service the loan and report it to Company as
herein provided.
2. If the Class B Certificates of the related Series are reduced to
zero, Special Servicer will continue to service the mortgage loans until they
payoff or are liquidated. No other Delinquent Mortgage Loans of a Series will be
transferred to Special Servicer after the Class B Certificates of such Series
are reduced to zero.
Servicing Transfer Instructions
I. NOTIFICATION OF LOANS TO TRANSFER
A. Company will coordinate and provide a listing of all loans past 90
days delinquent. The list will be provided to Special Servicer for review and
discussion on the 4th Business day of each month.
B. Class B Holder and Special Servicer to agree upon the loans to be
transferred at month-end. The list must be provided via Facsimile or E-mail by
the 6th business day of the month to:
[COMPANY]
[Address and contact]
II. CONVERSION DATA
Dependent upon the volume of loans transferring each month, the loans
will be transferred effective the first of each month based on the prior
month-end cut off by one of the following mutually agreed upon conversion
methods.
A. Manual conversion
1. Company to provide a "master file data record" (COMPANY reference
for master file data record?) for each loan (accompanied by a listing of all
code definitions).
2. Company to provide a trial balance containing all the loans.
B. Electronic conversion
1. Information will be provided in a Microsoft Excel spreadsheet (or
such other mutually agreeable format) containing mutually agreed upon fields.
2. Company to provide a trial balance containing all the loans.
Preliminary information for either a manual or electronic conversion
will be provided within 3 business days of receipt of the List of Loans to
Transfer to provide time for Special Servicer to verify and load the
information, with the exception of the specific data that is determined at the
transfer date.
III. HOMEOWNER NOTIFICATION
A. Company will mail the mortgagor notification (good-bye letter)
fifteen days prior to the transfer date. Company will forward a copy of its
good-bye letter to Special Servicer c/o [Dept.] (fax number ___-___-____) for
approval prior to mailing.
B. Copies of Company's mortgagor notification letters will be provided
to Special Servicer.
C. Company to receive a sample of Special Servicer's mortgagor
notification (welcome letter) for approval prior to mailing.
IV. HAZARD/FLOOD INSURANCE
A. Company to prepare a change to the mortgagee clause as follows:
Address: ___________________
Attention: ___________________
Telephone: ___________________
Facsimile: ___________________
B. Copies of the mortgagee clause change requests will be provided to
Special Servicer.
C. Any unpaid policies, expiration notices, cancellation notices, loans
with expired policies will be properly identified, sorted and marked for special
handling.
D. Company to provide a list of loans under "force place coverage"
program. Force place hazard insurance policies with ASG will be canceled upon
transfer of the loans. WNC force place flood policy coverage will stay in place
after transfer until the expiration date.
V. FHA LOANS
A. Company to provide screen prints to include the following items on
FHA Loans with a monthly premium.
1. Loan number
2. FHA case number
3. Anniversary date
4. Annual premium
5. Monthly amount
6. Total MIP paid to date
7. Next month the premium is due
B. Company to provide screen prints to include the following items on
FHA loans that the full premium was paid up front.
1. Loan number
2. FHA case number
3. Insuring date
4. Amount of prepaid premium
C. Company to prepare HUD Form 92080 with Special Servicer's HUD
mortgagee number (72313) and forward to HUD electronically. Proof of submission
will be forwarded to Special Servicer.
VI. CONVENTIONAL LOANS
A. Individual loan PMI certificates will be retained in the Servicing
File
B. Company to prepare notifications to the PMI companies requesting a
change of servicer to Special Servicer. Copies will be forwarded to Special
Servicer.
C. Company to provide screen prints of all loans with PMI to include:
1. Loan number
2. PMI company
3. PMI certificate number
4. Next due date
5. Last amount paid
VII. REAL ESTATE TAXES
A. Company to forward individual loan tax records showing payee, due
dates, frequency of payment, next due date, last paid date and last paid amount.
B Company to provide copies of the notifications to the individual tax
authorities and the Tax Service requests for a change of servicer to Special
Servicer under the following contract numbers (Transamerica-2489 Pinnacle - 119)
C. All property taxes due and payable will be paid prior to the
transfer date.
D. All tax bills received after the transfer date will be forwarded to
Special Servicer for
payment.
E. Company to provide a listing of any loans with delinquent taxes
containing the pertinent information as of the transfer date.
VIII. OPTIONAL INSURANCE
A. Company to provide a list of loans with A&H, life insurance,
accidental death insurance, etc., which will include the following information.
1. Loan number
2. Insurance company
3. Type of coverage
4. Amount of monthly premium
5. Last monthly premium paid
B. Company to provide copies of the master and/or individual policies
for the insurance coverage.
C. Company to provide copies of the notification sent to the insurance
companies.
IX. INVESTOR REPORTS
A. Company to provide a copy of the final remittance report to the
investor including a trial balance as of cutoff date.
B. Company to provide ending loan scheduled balance at transfer date.
C. Company to provide a report detailing advanced delinquent net
interest monthly by due date.
D. Company to provide a report detailing advanced delinquent principal
monthly by due date.
X. OTHER
A. Company to provide hardcopies of the last 24 months history for each
loan accompanied by an explanation of transaction codes.
B. Company to provide copies of the last escrow analysis for each loan
with an explanation of analysis method (cushion, etc.).
C. Company to provide the loan servicing file in hardcopy or microfiche
format.
D. Company to provide the currently active collection records and
pertinent information on delinquent loans.
E. Net escrow and unapplied funds as of the transfer date will be sent
to Special Servicer via check or wire within three business days of the
transfer, accompanied by an explanation of
Unapplied Funds codes.
F. The advances (exclusive of escrow advances, which will be handled in
Section X (E) above) incurred by Company will be billed to Special Servicer
accompanied by appropriate documentation. Special Servicer to reimburse Company
via check or wire for all advances (exclusive of escrow advances, which will be
handled in Section X (E) above) on the subject loans within three business days
of receipt of billing.
G. Company to provide a listing containing the mortgagor name,
co-mortgagor name, property address and mailing address for preparation of
Special Servicer's Notification Letters.
H. Company to provide the following items, sorted and clearly marked
for special handling.
1. Active foreclosure and bankruptcy files should have the status shown
on the front of each file.
2. Insurance loss drafts should provide all documentation on the
current status.
3. Unprocessed payoff funds should be accompanied by a copy of the
payoff quotation.
4. Information should be furnished on any pending payoff or assumption.
5. Information on any incomplete partial releases should be provided.
I. Loan payments received after the cutoff will be endorsed to
__________ and forwarded by overnight service to the following address within
twenty-four hours, properly identified with Company's loan number.
[Address]
Returned Items received after the transfer date will be forwarded to
Special Servicer for reimbursement. Special Servicer to reimburse
Company within 10 business days of receipt.
J. Company to ship all loan files and documentation related to the
individual transfers by the 3rd business day after the cut-off. Any information,
such as preliminary trial balances, master file data records, delinquency
information, etc. will be furnished as early as possible prior to the transfer
date.
All shipments to be sent to:
[Address]
K. Company to furnish all required IRS reporting statements for the
current year up to the transfer date, both to the mortgagors and to the
appropriate government agencies. Special Servicer to furnish all required
year-end reporting commencing on the effective date of transfer through the
year-end.
EXHIBIT A to Schedule II
LOAN INFORMATION TO BE PROVIDED TO COMPANY
EXHIBIT S
FORM OF FORM 10-K CERTIFICATE
I, [identify the certifying individual], certify that:
1. I have reviewed the annual report on Form 10-K for the fiscal year
[___], and all reports on Form 8-K containing distribution or servicing reports
filed in respect of periods included in the year covered by that annual report,
of the trust (the "Trust") created pursuant to the Pooling and Servicing
Agreement dated May 1, 2003 (the "P&S Agreement") among ABN AMRO Mortgage
Corporation (the "Depositor"), ABN AMRO Mortgage Group, Inc. as a servicer
("AAMG"), Washington Mutual Mortgage Securities Corp. as a servicer ("WMMSC,"
and together with AAMG, the "Servicers") and JPMorgan Chase Bank (the
"Trustee");
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 servicing information required to be
provided to the Trustee by each Servicer under the P&S Agreement for inclusion
in these reports is included in these reports;
4. I am responsible for reviewing the activities performed by AAMG
under the P&S Agreement and based upon my knowledge and the annual compliance
reviews required under the P&S Agreement in respect of AAMG, and except as
disclosed in the reports, AAMG has fulfilled its obligations under the P&S
Agreement;
Based on my knowledge and upon the annual compliance statement
included in the report and required to be delivered to the Trustee in respect of
WMMSC in accordance with the terms of the P&S Agreement, and except as disclosed
in the reports, WMMSC has fulfilled its obligations under the P&S Agreement; and
5. The reports disclose all significant deficiencies relating to each
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 P&S Agreement, that is included in these
reports.
In giving the certifications above, I have reasonably relied on the
information provided to me by the following unaffiliated parties: WMMSC [and the
Trustee] .
Date:____________
_________________________________*
[Signature]
Name:
Title:
* - to be signed by the senior officer in charge of the servicing functions of
AAMG
EXHIBIT T
FORM OF BACK-UP CERTIFICATION TO FORM 10-K CERTIFICATE
I, [identify the certifying individual], on behalf of [LaSalle Bank
National Association, as certificate administrator (the "Certificate
Administrator")] [JPMorgan Chase Bank, as trustee (the "Trustee")] certify that:
1. I have reviewed the annual report on Form 10-K for the fiscal year
[___], and all reports on Form 8-K containing distribution or servicing reports
filed in respect of periods included in the year covered by that annual report,
of the trust (the "Trust") created pursuant to the Pooling and Servicing
Agreement dated May 1, 2003 (the "P&S Agreement") among ABN AMRO Mortgage
Corporation (the "Depositor"), ABN AMRO Mortgage Group, Inc. as a servicer
("AAMG"), Washington Mutual Mortgage Securities Corp. as a servicer ("WMMSC" and
together with AAMG, the "Servicers") and JPMorgan Chase Bank (the "Trustee");
and
2. Based on my knowledge, the distribution information in these reports
and any other information provided by the [Trustee] [Certificate Administrator],
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 the statements were made, not misleading as of the
last day of the period covered by that annual report.
Date:____________
_________________________________
[Signature]
Name:
Title:
EXHIBIT U
FORM OF WMMSC BACK-UP CERTIFICATION TO FORM 10-K CERTIFICATE
I, [name of certifying individual], a duly elected and acting officer
of Washington Mutual Mortgage Securities Corp. (the "Servicer"), pursuant to
Section 3.12 of the Pooling and Servicing Agreement dated as of May 1, 2003 (as
from time to time amended or replaced by a reconstituted servicing or other
successor servicing agreement, the "Servicing Agreement") between the Servicer,
ABN AMRO Mortgage Corporation, as Depositor, ABN AMRO Mortgage Group, Inc., as
Seller and Servicer, and JPMorgan Chase Bank, as Trustee, certify to AAMG, the
Depositor, the Trustee, the Certificate Administrator and each other Person
entitled to receive servicing reports provided pursuant to Section 3.10 of the
Servicing Agreement (the "Servicing Reports"), each Person, if any, who
"controls" such Person within the meaning of the Securities Act of 1933, as
amended, and their respective officers and directors, with respect to the
calendar year immediately preceding the date of this certificate (the "Relevant
Year"), as follows:
1. For purposes of this certificate, "Relevant Information" means the
information in the certificate provided pursuant to Section 3.11 of the
Servicing Agreement (the "Annual Compliance Certificate") for the Relevant Year
and the information in all Servicer's Section 3.10 Reports, and any other final
servicing reports or officer's certificates, provided by the Servicer during the
Relevant Year. Based on my knowledge, the Relevant Information, taken as a
whole, does not contain any untrue statement of a material fact or omit to state
a material fact required to be stated therein which is necessary to make the
statements made therein, in light of the circumstances under which such
statements were made, not misleading as of the last day of the Relevant Year.
2. The Relevant Information required to be provided by the Servicer has
been provided to those Persons entitled to receive it.
3. I am responsible for reviewing the activities performed by the
Servicer under the Servicing Agreement during the Relevant Year. Based upon the
review required by the Servicing Agreement and except as disclosed in the Annual
Compliance Certificate or the accountants' statement provided pursuant to
Section 3.12, to the best of my knowledge, the Servicer has fulfilled its
obligations under the Servicing Agreement throughout the Relevant Year.
DATED as of __________, 200_.
_____________________________________
Name: _______________________________
Title: ______________________________
