STRUCTURED ASSET MORTGAGE INVESTMENTS II INC.,
DEPOSITOR
U.S. BANK, NATIONAL ASSOCIATION,
TRUSTEE
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
MASTER SERVICER AND SECURITIES ADMINISTRATOR
and
EMC MORTGAGE CORPORATION
SELLER AND COMPANY
POOLING AND SERVICING AGREEMENT
Dated as of June 1, 2005
Structured Asset Mortgage Investments II Inc.
Prime Mortgage Trust, Certificates
Series 2005-2
TABLE OF CONTENTS
ARTICLE I
Definitions
Section 1.01 Definitions
Section 1.02 Calculation of LIBOR
ARTICLE II
Conveyance of Mortgage Loans; Original Issuance of Certificates
Section 2.01 Conveyance of Mortgage Loans to Trustee
Section 2.02 Acceptance of Mortgage Loans and Underlying Certificates by
Trustee
Section 2.03 Assignment of Interest in the Mortgage Loan Purchase
Agreement
Section 2.04 Substitution of Mortgage Loans
Section 2.05 Issuance of Certificates
Section 2.06 Representations and Warranties Concerning the Depositor
ARTICLE III
Administration of the Trust Fund and Servicing of Mortgage Loans
Section 3.01 Master Servicer and Securities Administrator
Section 3.02 REMIC-Related Covenants
Section 3.03 Monitoring of Servicers
Section 3.04 Fidelity Bond
Section 3.05 Power to Act; Procedures
Section 3.06 Due-on-Sale Clauses; Assumption Agreements
Section 3.07 Release of Mortgage Files
Section 3.08 Documents, Records and Funds in Possession of Master
Servicer to Be Held for Trustee
Section 3.09 Standard Hazard Insurance and Flood Insurance Policies
Section 3.10 Presentment of Claims and Collection of Proceeds
Section 3.11 Maintenance of the Primary Mortgage Insurance Policies
Section 3.12 Trustee to Retain Possession of Certain Insurance Policies
and Documents
Section 3.13 Realization Upon Defaulted Mortgage Loans
Section 3.14 Compensation for the Master Servicer
Section 3.15 REO Property
Section 3.16 Annual Officer's Certificate as to Compliance
Section 3.17 Annual Independent Accountant's Servicing Report
Section 3.18 Reports Filed with Securities and Exchange Commission
Section 3.19 [Reserved]
Section 3.20 UCC
Section 3.21 Optional Purchase of Defaulted Mortgage Loans
ARTICLE IV
Accounts
Section 4.01 Protected Account
Section 4.02 Master Servicer Collection Account
Section 4.03 Permitted Withdrawals and Transfers from the Master Servicer
Collection Account
Section 4.04 Distribution Account
Section 4.05 Permitted Withdrawals and Transfers from the Distribution
Account
ARTICLE V
Certificates
Section 5.01 Certificates
Section 5.02 Registration of Transfer and Exchange of Certificates
Section 5.03 Mutilated, Destroyed, Lost or Stolen Certificates
Section 5.04 Persons Deemed Owners
Section 5.05 Transfer Restrictions on Residual Certificates
Section 5.06 Restrictions on Transferability of Non-Offered Certificates
Section 5.07 ERISA Restrictions
Section 5.08 Rule 144A Information
Section 5.09 Appointment of Paying Agent and Certificate Registrar
ARTICLE VI
Payments to Certificateholders
Section 6.01 Distributions on the Certificates
Section 6.02 [Reserved.]
Section 6.03 Allocation of Losses
Section 6.04 Payments
Section 6.05 Statements to Certificateholders
Section 6.06 Monthly Advances
Section 6.07 Compensating Interest Payments
ARTICLE VII
The Master Servicer-
Section 7.01 Liabilities of the Master Servicer
Section 7.02 Merger or Consolidation of the Master Servicer
Section 7.03 Indemnification of the Trustee, the Master Servicer and the
Securities Administrator
Section 7.04 Limitations on Liability of the Master Servicer and Others
Section 7.05 Master Servicer Not to Resign
Section 7.06 Successor Master Servicer
Section 7.07 Sale and Assignment of Master Servicing
ARTICLE VIII
Default
Section 8.01 Events of Default
Section 8.02 Trustee to Act; Appointment of Successor
Section 8.03 Notification to Certificateholders
Section 8.04 Waiver of Defaults
Section 8.05 List of Certificateholders
ARTICLE IX
Concerning the Trustee and the Securities Administrator
Section 9.01 Duties of Trustee and Securities Administrator
Section 9.02 Certain Matters Affecting the Trustee and the Securities
Administrator
Section 9.03 Trustee and Securities Administrator Not Liable for
Certificates or Mortgage Loans
Section 9.04 Trustee and Securities Administrator May Own Certificates
Section 9.05 Trustee's and Securities Administrator's Fees and Expenses
Section 9.06 Eligibility Requirements for Trustee and Securities
Administrator
Section 9.07 Insurance
Section 9.08 Resignation and Removal of the Trustee and Securities
Administrator
Section 9.09 Successor Trustee and Successor Securities Administrator
Section 9.10 Merger or Consolidation of Trustee or Securities
Administrator
Section 9.11 Appointment of Co-Trustee or Separate Trustee
Section 9.12 Federal Information Returns and Reports to
Certificateholders; REMIC Administration
ARTICLE X
Termination
Section 10.01 Termination Upon Repurchase by the Depositor or its Designee
or Liquidation of the Mortgage Loans
Section 10.02 [Reserved]
Section 10.03 Additional Termination Requirements with respect to the
Certificates
ARTICLE XI
Miscellaneous Provisions
Section 11.01 Intent of Parties
Section 11.02 Amendment
Section 11.03 Recordation of Agreement
Section 11.04 Limitation on Rights of Certificateholders
Section 11.05 Acts of Certificateholders
Section 11.06 Governing Law
Section 11.07 Notices
Section 11.08 Severability of Provisions
Section 11.09 Successors and Assigns
Section 11.10 Article and Section Headings
Section 11.11 Counterparts
Section 11.12 Notice to Rating Agencies
EXHIBITS
Exhibit A-1 - Form of Class [_]-A-[_] Certificates
Exhibit A-2 - Form of Class [_]-B-[_] Certificates
Exhibit A-3 - Form of Class I-PO Certificates
Exhibit A-4 - Form of Class I-R Certificates
Exhibit A-5 - Form of Class II-R Certificates
Exhibit A-6 - Form of Class I-X Certificates
Exhibit A-7 - Form of Class II-X[B] Certificates
Exhibit B - Mortgage Loan Schedule
Exhibit C - Reserved
Exhibit D - Request for Release of Documents
Exhibit E - Form of Affidavit pursuant to Section 860E(e)(4)
Exhibit F-1 - Form of Investment Letter
Exhibit F-2 - Form of Rule 144A and Related Matters Certificate
Exhibit F-3 Form of Rule 144A Global Certificate to Regulation S Global
Certificate
Exhibit F-4 Form of Regulation S Global Certificate to Rule 144A Global
Certificate
Exhibit G - Form of Custodial Agreement
Exhibit H-1 - CitiMortgage Servicing Agreement
Exhibit H-2 - EMC Servicing Agreement
Exhibit H-3 - EverHome Servicing Agreement
Exhibit H-4 - Fifth Third Servicing Agreement
Exhibit X-0 - XXXX Xxxxxxxxx Xxxxxxxxx
Xxxxxxx X-0 - XxxxxXxxxx Servicing Agreement
Exhibit H-7 - National City Servicing Agreement
Exhibit H-8 - Navy Federal Servicing Agreement
Exhibit H-9 - PHH Mortgage Servicing Agreement
Exhibit X-00 - XxxXxxxx Xxxxxxxxx Xxxxxxxxx
Xxxxxxx X-00 - XXXX Servicing Agreement
Exhibit H-12 - Xxxxx Fargo Servicing Agreement
Exhibit I - Assignment Agreements
Exhibit J - Mortgage Loan Purchase Agreement
POOLING AND SERVICING AGREEMENT
Pooling and Servicing Agreement dated as of June 1, 2005, among
Structured Asset Mortgage Investments II Inc., a Delaware corporation, as
depositor (the "Depositor"), U.S. Bank National Association, a national banking
association, (the "Trustee"), Xxxxx Fargo Bank, National Association, as master
servicer (in such capacity, the "Master Servicer") and as securities
administrator (in such capacity, the "Securities Administrator"), and EMC
Mortgage Corporation, as seller (in such capacity, the "Seller") and as company
(in such capacity, the "Company").
PRELIMINARY STATEMENT
On or prior to the Closing Date, the Depositor acquired the Mortgage
Loans from the Seller. On the Closing Date, the Depositor will sell the Mortgage
Loans and certain other property to the Trust Fund and receive in consideration
therefor the Certificates, together evidencing the entire beneficial ownership
interest in the Trust Funds.
The Trustee on behalf of the Trust shall make an election for the
assets constituting REMIC I to be treated for federal income tax purposes as a
REMIC. On the Startup Day, the REMIC I Regular Interests will be designated
"regular interests" in such REMIC, and the Class I-R-1 Certificates will be
designated the sole class of "residual interests" in such REMIC.
The Trustee on behalf of the Trust shall make an election for the
assets constituting REMIC II to be treated for federal income tax purposes as a
REMIC. On the Startup Day, the REMIC II Regular Interests will be designated
"regular interests" in such REMIC, and the Class II-R-1 Certificate will be
designated the sole class of "residual interests" in such REMIC.
The Trustee on behalf of the Trust shall make an election for the
assets constituting REMIC III to be treated for federal income tax purposes as a
REMIC. On the Startup Day, the REMIC III Regular Interests will be designated
"regular interests" in such REMIC, and the Class I-R-2 Certificates will be
designated the sole class of "residual interests" in such REMIC.
The Mortgage Loans will have an Outstanding Principal Balance as of the
Cut-off Date, after deducting all Scheduled Principal due on or before the
Cut-off Date, of $243,340,462.01. The initial principal amount of the
Certificates will not exceed such Outstanding Principal Balance.
The Mortgage Loans have been divided into two Loan Groups, designated
as Loan Group I and Loan Group II. The Group I Mortgage Loans will have an
Outstanding Principal Balance as of the Cut-off Date, after deducting all
Scheduled Principal due on or before the Cut-off Date, of $120,925,950.59. The
Group II Mortgage Loans will have an Outstanding Principal Balance as of the
Cut-off Date, after deducting all Scheduled Principal due on or before the
Cut-off Date, of $122,414,511.42. The Group I Certificates and Group II
Certificates shall receive distributions solely with respect to the Group I
Mortgage Loans and Group II Mortgage Loans, respectively.
In consideration of the mutual agreements herein contained, the
Depositor, the Master Servicer, the Securities Administrator, the Seller, the
Company and the Trustee agree as follows:
ARTICLE I
Definitions
Section 1.01 DEFINITIONS.
Whenever used in this Agreement, the following words and phrases,
unless otherwise expressly provided or unless the context otherwise requires,
shall have the meanings specified in this Article.
ACCEPTED MASTER SERVICING PRACTICES: With respect to any Mortgage Loan,
as applicable, either (x) those customary mortgage servicing practices of
prudent mortgage servicing institutions that master service mortgage loans of
the same type and quality as such Mortgage Loan in the jurisdiction where the
related Mortgaged Property is located, to the extent applicable to the Trustee
or the Master Servicer (except in its capacity as successor to a Servicer), or
(y) as provided in the applicable Servicing Agreement, to the extent applicable
to any Servicer, but in no event below the standard set forth in clause (x).
ACCOUNT: The Master Servicer Collection Account, the Distribution
Account and the Protected Account as the context may require.
ACCRUED CERTIFICATE INTEREST: For any Certificate (other than the Class
I-PO Certificates) for any Distribution Date, the interest accrued during the
related Interest Accrual Period at the applicable Pass-Through Rate on the
Current Principal Amount, or Notional Amount in the case of any Interest Only
Certificate, of such Certificate immediately prior to such Distribution Date,
less (i) in the case of a Senior Certificate (other than the Class I-PO
Certificates), such Certificate's share of any Net Interest Shortfall from the
related Mortgage Loans and, after the Cross-Over Date, the interest portion of
any Realized Losses on the related Mortgage Loans allocated thereto in
accordance with Section 6.03(f) and (ii) in the case of a Subordinate
Certificate, such Certificate's share of any Net Interest Shortfall from the
related Mortgage Loans and the interest portion of any Realized Losses on the
related Mortgage Loans allocated thereto in accordance with Section 6.02(f). All
calculations of interest on the Certificates will be made on the basis of on the
basis of a 360-day year consisting of twelve 30-day months.
ADJUSTMENT AMOUNT: Group I Adjustment Amount or Group II Adjustment
Amount.
AFFILIATE: As to any Person, any other Person controlling, controlled
by or under common control with such Person. "Control" means the power to direct
the management and policies of a Person, directly or indirectly, whether through
ownership of voting securities, by contract or otherwise. "Controlled" and
"Controlling" have meanings correlative to the foregoing. The Trustee may
conclusively presume that a Person is not an Affiliate of another Person unless
a Responsible Officer of the Trustee has actual knowledge to the contrary.
AGREEMENT: This Pooling and Servicing Agreement and all amendments
hereof and supplements hereto.
ALLOCABLE SHARE: Group I Allocable Share or Group II Allocable Share.
APPLICABLE CREDIT RATING: For any long-term deposit or security, a
credit rating of AAA in the case of each of S&P and Fitch Ratings or Aaa in the
case of Moody's. For any short-term deposit or security, or a rating of A-l+ in
the case of each of S&P and Fitch Ratings or P-1 in the case of Moody's.
APPLICABLE STATE LAW: For purposes of Section 9.12(d), the Applicable
State Law shall be (a) the law of the State of New York and (b) such other state
law whose applicability shall have been brought to the attention of the
Securities Administrator and the Trustee by either (i) an Opinion of Counsel
reasonably acceptable to the Securities Administrator and the Trustee delivered
to it by the Master Servicer or the Depositor, or (ii) written notice from the
appropriate taxing authority as to the applicability of such state law.
APPRAISED VALUE: For any Mortgaged Property related to a Mortgage Loan,
the amount set forth as the appraised value of such Mortgaged Property in an
appraisal made for the mortgage originator in connection with its origination of
the related Mortgage Loan.
ASSIGNMENT AGREEMENT: The agreements attached hereto as Exhibit I,
whereby the related Servicing Agreements were assigned to the Trustee for the
benefit of the Holders of the Certificateholders.
ASSIGNMENT OF PROPRIETARY LEASE: With respect to a Cooperative Loan,
the assignment of the related Cooperative Lease from the Mortgagor to the
originator of the Cooperative Loan.
ASSUMED FINAL DISTRIBUTION DATE: With respect to the Group I
Certificates, July 20, 2020, and, with respect to the Group II Certificates,
October 25, 2032.
AVAILABLE FUNDS: Group I Available Funds or Group II Available Funds.
AVERAGE LOSS SEVERITY PERCENTAGE: With respect to any Distribution
Date, the percentage equivalent of a fraction, the numerator of which is the sum
of the Loss Severity Percentages for each Mortgage Loan which had a Realized
Loss and the denominator of which is the number of Mortgage Loans which had
Realized Losses.
BANKRUPTCY CODE: The United States Bankruptcy Code, as amended as
codified in 11 U.S.C. xx.xx. 101-1330.
BANKRUPTCY COVERAGE TERMINATION DATE: Group I Bankruptcy Coverage
Termination Date or Group II Bankruptcy Coverage Termination Date.
BANKRUPTCY LOSS AMOUNT: Group I Bankruptcy Loss Amount or Group II
Bankruptcy Loss Amount.
BANKRUPTCY LOSS: With respect to any Mortgage Loan, any Deficient
Valuation or Debt Service Reduction related to such Mortgage Loan as reported by
the applicable Servicer to the Master Servicer.
BOOK-ENTRY CERTIFICATES: Initially, all Classes of the Senior
Certificates (other than the Residual Certificates) and the Offered Subordinate
Certificates.
BUSINESS DAY: Any day other than (i) a Saturday or a Sunday, or (ii) a
day on which the New York Stock Exchange or Federal Reserve is closed or on
which banking institutions in the jurisdiction in which the Trustee, the Master
Servicer, any Servicer or the Securities Administrator is located are authorized
or obligated by law or executive order to be closed.
CERTIFICATE: Any one of the Certificates executed and countersigned by
the Certificate Registrar substantially in the form of Exhibits A-1 through A-7
attached hereto.
CERTIFICATES DISTRIBUTION REPORT: The report prepared by the Securities
Administrator with respect to the Certificates and the Mortgage Loans pursuant
to Section 6.05(a).
CERTIFICATEHOLDER: A Holder of a Certificate.
CERTIFICATE OWNER: Any Person who is the beneficial owner of a
Certificate registered in the name of the Depository or its nominee.
CERTIFICATE REGISTER: The register maintained pursuant to Section 5.02.
CERTIFICATE REGISTRAR: The Securities Administrator or any successor
certificate registrar appointed hereunder.
CITIMORTGAGE: CitiMortgage, Inc., or its successor in interest.
CITIMORTGAGE SERVICING AGREEMENT: The Mortgage Loan Purchase and
Servicing Agreement, dated as of August 1, 2003, between the Seller and
CitiMortgage, attached hereto as Exhibit H-1, and as modified by the related
Assignment Agreement.
CLASS: With respect to the Certificates, I-A-1, X-X-0, X-X-0, X-XX,
X-X, X-X-0, X-X-0, X-X-0, I-B-2, I-B-3, I-B-4, X-X-0, X-X-0, XX-X-0, XX-X,
XX-X-0, XX-X-0, XX-X-0, II-B-3, II-XB, II-B-4, II-B-5 and II-B-6.
CLASS I-A CERTIFICATES: Any of the Class I-A-1, Class I-A-2 and Class
I-A-3 Certificates.
CLASS I-R CERTIFICATES: The Class I-R-1 Certificates and Class I-R-2
Certificates.
CLASS I-PO CERTIFICATE CASH SHORTFALL: For any Distribution Date, the
difference between (i) principal distributable to the Class I-PO Certificates in
accordance with priority FOURTH of clause (i) under subsection 6.01(a), and (ii)
principal actually distributed to the Class I-PO Certificates after giving
effect to clause (iii) under subsection 6.01(a).
CLASS I-PO CERTIFICATE DEFERRED AMOUNT: As to each Distribution Date
through the Group I Cross-Over Date, the aggregate of all amounts allocable on
such dates to the Class I-PO Certificates in respect of the principal portion of
Realized Losses in respect of Discount Mortgage Loans in Subgroup I-1 and the
Class I-PO Certificate Cash Shortfall and all amounts previously allocated in
respect of such losses and such shortfalls to the Class I-PO Certificates, and
not distributed on prior Distribution Dates.
CLASS I-PO CERTIFICATE PRINCIPAL DISTRIBUTION AMOUNT: The Class I-PO
Certificates shall be entitled to distributions from Subgroup I-1. For each
Class of Class I-PO Certificates with respect to each Distribution Date will be
an amount equal to the sum of:
(i) the PO Percentage of all scheduled payments of principal
due on each Discount Mortgage Loan in Subgroup I-1 on the related Due
Date as specified in the amortization schedule at the time applicable
thereto (after adjustment for previous principal prepayments but before
any adjustment to such amortization schedule by reason of any
bankruptcy or similar proceeding or any moratorium or similar waiver or
grace period);
(ii) the PO Percentage of the Scheduled Principal Balance of
each Discount Mortgage Loan in Subgroup I-1 which was the subject of a
prepayment in full received by the Master Servicer during the
applicable Prepayment Period;
(iii) the PO Percentage of all partial prepayments of
principal of each Discount Mortgage Loan in the related Subgroup
received during the applicable Prepayment Period;
(iv) the lesser of (a) the PO Percentage of the sum of (A) all
Net Liquidation Proceeds and Subsequent Recoveries allocable to
principal on each Discount Mortgage Loan in Subgroup I-1 which became a
Liquidated Mortgage Loan during the related Prepayment Period (other
than a Discount Mortgage Loan described in clause (B)) and (B) the
Scheduled Principal Balance of each such Discount Mortgage Loan in
Subgroup I-1 purchased by an insurer from the Trustee during the
related Prepayment Period pursuant to the related Primary Mortgage
Insurance Policy, if any, or otherwise; and (b) the PO Percentage of
the sum of (A) the Scheduled Principal Balance of each Discount
Mortgage Loan in Subgroup I-1 which became a Liquidated Mortgage Loan
during the related Prepayment Period (other than a Discount Mortgage
Loan described in clause (B)) and (B) the Scheduled Principal Balance
of each such Mortgage Loan in Subgroup I-1 that was purchased by an
insurer from the Trustee during the related Prepayment Period pursuant
to the related Primary Mortgage Insurance Policy, if any, or otherwise;
and
(v) the PO Percentage of the sum of (a) the Scheduled
Principal Balance of each Discount Mortgage Loan in Subgroup I-1 which
was repurchased by the Seller in connection with such Distribution Date
and (b) the difference, if any, between the Scheduled Principal Balance
of a Discount Mortgage Loan in Subgroup I-1 that has been replaced by
the Seller with a substitute Discount Mortgage Loan pursuant to the
Agreement in connection with such Distribution Date and the Scheduled
Principal Balance of such substitute Discount Mortgage Loan.
CLASS PREPAYMENT DISTRIBUTION TRIGGER: For a Class of related
Subordinate Certificates for any Distribution Date, the Class Prepayment
Distribution Trigger is satisfied if the fraction (expressed as a percentage),
the numerator of which is the aggregate Current Principal Amount of such Class
and each Class of the related Subordinate Certificates subordinate thereto, if
any, and the denominator of which is the Scheduled Principal Balance of all of
the related Mortgage Loans as of the related Due Date, equals or exceeds such
percentage calculated as of the Closing Date.
CLASS R CERTIFICATES: The Class I-R-1, Class I-R-2 and Class I-R-3
Certificates.
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, Clearstream, Luxembourg and Euroclear.
CLEARSTREAM, LUXEMBOURG: Clearstream Banking, a societe anonyme, a
limited liability company organized under the laws of Luxembourg.
CLOSING DATE: June 30, 2005.
CODE: The Internal Revenue Code of 1986, as amended.
COMPENSATING INTEREST PAYMENT: As defined in Section 6.06.
COOPERATIVE: A private, cooperative housing corporation which owns or
leases land and all or part of a building or buildings, including apartments,
spaces used for commercial purposes and common areas therein and whose board of
directors authorizes, among other things, the sale of Cooperative Stock.
COOPERATIVE APARTMENT: A dwelling unit in a multi-dwelling building
owned or leased by a Cooperative, which unit the Mortgagor has an exclusive
right to occupy pursuant to the terms of a proprietary lease or occupancy
agreement.
COOPERATIVE LEASE: With respect to a Cooperative Loan, the proprietary
lease or occupancy agreement with respect to the Cooperative Apartment occupied
by the Mortgagor and relating to the related Cooperative Stock, which lease or
agreement confers an exclusive right to the holder of such Cooperative Stock to
occupy such apartment.
COOPERATIVE LOAN: Any of the Mortgage Loans made in respect of a
Cooperative Apartment, evidenced by a Mortgage Note and secured by (i) a
Security Agreement, (ii) the related Cooperative Stock Certificate, (iii) an
assignment of the Cooperative Lease, (iv) financing statements and (v) a stock
power (or other similar instrument), and ancillary thereto, a recognition
agreement between the Cooperative and the originator of the Cooperative Loan,
each of which was transferred and assigned to the Trustee pursuant to Section
2.01 and are from time to time held as part of the Trust Fund.
COOPERATIVE STOCK: With respect to a Cooperative Loan, the single
outstanding class of stock, partnership interest or other ownership instrument
in the related Cooperative.
COOPERATIVE STOCK CERTIFICATE: With respect to a Cooperative Loan, the
stock certificate or other instrument evidencing the related Cooperative Stock.
CORPORATE TRUST OFFICE: The office of the Trustee at which at any
particular time its corporate trust business is administered, which office, at
the date of the execution of this Agreement, is located at US Bank Corporate
Trust Services, Xxx Xxxxxxx Xxxxxx, 0xx Xxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000,
Attention: Corporate Trust Services/PRIME 2005-2, or such other address as the
Trustee may designate from time to time. With respect to the Certificate
Registrar and the presentment of Certificates for registration of transfer,
exchange or final payment, Xxxxx Fargo Bank, National Association, its offices
located at Xxxxx Xxxxxx xxx Xxxxxxxxx Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx 00000,
Attention: Corporate Trust/PRIME 2005-2, and for all other purposes, its offices
located at X.X. Xxx 00, Xxxxxxxx, Xxxxxxxx 00000 (or, for overnight deliveries,
0000 Xxx Xxxxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxx 00000), Attention: Corporate
Trust/Prime 2005-2.
CORRESPONDING CERTIFICATES: With respect to each REMIC II Regular
Interest, the Class with the same designation.
CROSS-OVER DATE: Group I Cross-Over Date or Group II Cross-Over Date.
CURRENT PRINCIPAL AMOUNT: With respect to any Certificate (other than
an Interest Only Certificate) as of any Distribution Date, the initial principal
amount of such Certificate plus any Subsequent Recoveries added to the Current
Principal Amount of such Certificate pursuant to Section 6.01(h), and reduced by
(i) all amounts distributed on previous Distribution Dates on such Certificate
with respect to principal, (ii) the principal portion of all Realized Losses
allocated prior to such Distribution Date to such Certificates, taking account
of the Loss Allocation Limitation and (iii) in the case of a Subordinate
Certificate, such Certificate's pro rata share, if any, of the related
applicable Subordinate Certificate Writedown Amount for previous Distribution
Dates. With respect to any Class of Certificates (other than an Interest Only
Certificate), the Current Principal Amount thereof will equal the sum of the
Current Principal Amounts of all Certificates in such Class. Notwithstanding the
foregoing, solely for purposes of giving consents, directions, waivers,
approvals, requests and notices, each of the Residual Certificates after the
Distribution Date on which they each receive the distribution of the last dollar
of their respective original principal amount shall be deemed to have Current
Principal Amounts equal to their respective Current Principal Amounts on the day
immediately preceding such Distribution Date.
CUSTODIAL AGREEMENT: An agreement, dated as of the Closing Date among
the Depositor, the Master Servicer, the Trustee and the Custodian in
substantially the form of Exhibit G hereto.
CUSTODIAN: Xxxxx Fargo Bank, National Association, or any successor
custodian appointed pursuant to the provisions hereof and of the Custodial
Agreement.
CUT-OFF DATE: June 1, 2005.
CUT-OFF DATE BALANCE: An amount equal to $120,925,950.59 with respect
to Loan Group I and $122,414,511.42 with respect to Loan Group II.
DEBT SERVICE REDUCTION: Any reduction of the Scheduled Payments which a
Mortgagor is obligated to pay with respect to a Mortgage Loan as a result of any
proceeding under the Bankruptcy Code or any other similar state law or other
proceeding.
DEFICIENT VALUATION: With respect to any Mortgage Loan, a valuation of
the Mortgaged Property by a court of competent jurisdiction in an amount less
than the then outstanding indebtedness under the Mortgage Loan, which valuation
results from a proceeding initiated under the Bankruptcy Code or any other
similar state law or other proceeding.
DEPOSITOR: Structured Asset Mortgage Investments II Inc., a Delaware
corporation, or its successors in interest.
DEPOSITORY: The Depository Trust Company, the nominee of which is Cede
& Co., or any successor thereto.
DEPOSITORY AGREEMENT: The meaning specified in Subsection 5.01(a)
hereof.
DEPOSITORY PARTICIPANT: A broker, dealer, bank or other financial
institution or other Person for whom from time to time the Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
DESIGNATED DEPOSITORY INSTITUTION: A depository institution (commercial
bank, federal savings bank, mutual savings bank or savings and loan association)
or trust company (which may include the Trustee), the deposits of which are
fully insured by the FDIC to the extent provided by law.
DETERMINATION DATE: With respect to each Mortgage Loan, the
Determination Date as defined in the related Servicing Agreement.
DISCOUNT MORTGAGE LOAN: Any Mortgage Loan with a Net Mortgage Rate less
than 4.7500% per annum.
DISQUALIFIED ORGANIZATION: Any of the following: (i) the United States,
any State or political subdivision thereof, any possession of the United States,
or any agency or instrumentality of any of the foregoing (other than an
instrumentality which is a corporation if all of its activities are subject to
tax and, except for the Xxxxxxx Mac or any successor thereto, a majority of its
board of directors is not selected by such governmental unit), (ii) any foreign
government, any international organization, or any agency or instrumentality of
any of the foregoing, (iii) any organization (other than certain farmers'
cooperatives described in Section 521 of the Code) which is exempt from the tax
imposed by Chapter 1 of the Code (including the tax imposed by Section 511 of
the Code on unrelated business taxable income), (iv) rural electric and
telephone cooperatives described in Section 1381(a)(2)(C) of the Code or (v) any
other Person so designated by the Trustee and the Certificate Registrar based
upon an Opinion of Counsel that the holding of an ownership interest in a
Residual Certificate by such Person may cause any REMIC contained in the Trust
or any Person having an Ownership Interest in the Residual Certificate (other
than such Person) to incur a liability for any federal tax imposed under the
Code that would not otherwise be imposed but for the transfer of an Ownership
Interest in a Residual Certificate to such Person. The terms "United States,"
"State" and "international organization" shall have the meanings set forth in
Section 7701 of the Code or successor provisions.
DISTRIBUTION ACCOUNT: The trust account or accounts created and
maintained pursuant to Section 4.04, which shall be denominated "Xxxxx Fargo
Bank, National Association, as Paying Agent, f/b/o holders of Structured Asset
Mortgage Investments II Inc., Prime Mortgage Trust, Certificates, Series 2005-2
- Distribution Account." The Distribution Account shall be an Eligible Account.
DISTRIBUTION ACCOUNT DEPOSIT DATE: The Business Day prior to each
Distribution Date.
DISTRIBUTION DATE: The 25th day of any month, beginning in July 2005,
or, if such 25th day is not a Business Day, the immediately following Business
Day.
DTC CUSTODIAN: Xxxxx Fargo, National Association, or its successors in
interest as custodian for the Depository.
DUE DATE: With respect to each Mortgage Loan, the date in each month on
which its Scheduled Payment is due if such due date is the first day of a month
and otherwise is deemed to be the first day of the following month or such other
date specified in the related Servicing Agreement.
DUE PERIOD: With respect to any Distribution Date and each Mortgage
Loan, the period commencing on the second day of the month preceding the month
in which the Distribution Date occurs and ending at the close of business on the
first day of the month in which the Distribution Date occurs.
ELIGIBLE ACCOUNT: Any of (i) a segregated account maintained with a
federal or state chartered depository institution (A) the short-term obligations
of which are rated A-1 or better by Standard & Poor's, F-1 by Fitch Ratings and
P-1 by Moody's at the time of any deposit therein or (B) insured by the FDIC (to
the limits established by such Corporation), the uninsured deposits in which
account are otherwise secured such that, as evidenced by an Opinion of Counsel
(obtained by the Person requesting that the account be held pursuant to this
clause (i)) delivered to the Trustee prior to the establishment of such account,
the Certificateholders will have a claim with respect to the funds in such
account and a perfected first priority security interest against any collateral
(which shall be limited to Permitted Investments, each of which shall mature not
later than the Business Day immediately preceding the Distribution Date next
following the date of investment in such collateral or the Distribution Date if
such Permitted Investment is an obligation of the institution that maintains the
Distribution Account) securing such funds that is superior to claims of any
other depositors or general creditors of the depository institution with which
such account is maintained, (ii) a segregated trust account or accounts
maintained with a federal or state chartered depository institution or trust
company with trust powers acting in its fiduciary capacity or (iii) a segregated
account or accounts of a depository institution acceptable to the Rating
Agencies (as evidenced in writing by the Rating Agencies that use of any such
account as the Distribution Account will not have an adverse effect on the
then-current ratings assigned to the Classes of Certificates then rated by the
Rating Agencies determined without regard to the Policy). Eligible Accounts may
bear interest.
EMC: EMC Mortgage Corporation.
EMC SERVICING AGREEMENT: With respect to Mortgage Loans serviced by
EMC, the Servicing Agreement dated as of June 1, 2005, between the Depositor and
EMC, as attached hereto as Exhibit H-2 and as modified by the related Assignment
Agreement.
ERISA: The Employee Retirement Income Security Act of 1974, as amended.
EUROCLEAR: Euroclear Clearance System, Societe Cooperative, a Belgium
cooperative cooperation.
EUROCLEAR OPERATOR: Euroclear Bank S.A./N.V., as operator of the
Euroclear system.
EVENT OF DEFAULT: An event of default described in Section 8.01.
EVERHOME: EverHome Mortgage Company, or its successor in interest.
EVERHOME SERVICING AGREEMENT: The Subservicing Agreement, dated as of
August 1, 2002, between the Seller and EverHome, attached hereto as Exhibit H-3,
and as modified by the related Assignment Agreement.
EXCESS BANKRUPTCY LOSS: Any Bankruptcy Loss, or portion thereof (i)
occurring after the related Bankruptcy Coverage Termination Date or (ii) if on
or prior to such date, in excess of the then-applicable Bankruptcy Loss Amount.
EXCESS FRAUD LOSS: Any Fraud Loss or portion thereof (i) occurring
after the related Fraud Coverage Termination Date with respect thereto or (ii)
if on or prior to such date, in excess of the then-applicable Fraud Loss Amount.
EXCESS LOSS: Any Excess Fraud Loss, Excess Bankruptcy Loss, Excess
Special Hazard Loss or Extraordinary Loss.
EXCESS LIQUIDATION PROCEEDS: To the extent that such amount is not
required by law to be paid to the related Mortgagor, the amount, if any, by
which Liquidation Proceeds with respect to a Liquidated Mortgage Loan exceed the
sum of (i) the Outstanding Principal Balance of such Mortgage Loan and accrued
but unpaid interest at the related Mortgage Interest Rate through the last day
of the month in which the related Liquidation Date occurs, plus (ii) related
Liquidation Expenses.
EXCESS SPECIAL HAZARD LOSS: Any Special Hazard Loss occurring after the
related Special Hazard Termination Date.
EXTRAORDINARY LOSS: Any Realized Loss resulting from damage to a
Mortgaged Property that was occasioned by war, civil insurrection, certain
governmental actions, nuclear reaction and certain other risks.
XXXXXX XXX: Federal National Mortgage Association or any successor
thereto.
FDIC: Federal Deposit Insurance Corporation or any successor thereto.
FIFTH THIRD: Fifth Third Mortgage Company, or its successor in
interest.
FIFTH THIRD SERVICING AGREEMENT: The Purchase, Warranties and Servicing
Agreement, dated as of September 1, 2002, between the Seller and Fifth Third,
attached hereto as Exhibit H-4, and as modified by the related Assignment
Agreement
FINAL CERTIFICATION: The certification substantially in the form of
Exhibit Three to the Custodial Agreement.
FISCAL QUARTER: December 1 to February 29 (or the last day in such
month), March 1 to May 31, June 1 to August 31, or September 1 to November 30,
as applicable.
FITCH RATINGS: Fitch, Inc.
FRACTIONAL UNDIVIDED INTEREST: With respect to any Class of
Certificates, the fractional undivided interest evidenced by any Certificate of
such Class, the numerator of which is the Current Principal Amount, or Notional
Amount in the case of the Interest Only Certificates, of such Certificate and
the denominator of which is the Current Principal Amount, or Notional Amount in
the case of the Interest Only Certificates, of such Class. With respect to the
Certificates in the aggregate, the fractional undivided interest evidenced by
(i) the Residual Certificates will be deemed to equal 0.25%, (ii) each Class of
Interest Only Certificates will be deemed to equal 1.0% multiplied by a
fraction, the numerator of which is the Notional Amount of such Certificate and
the denominator of which is the aggregate Notional Amount of its respective
Class and (iii) a Certificate of any other Class will be deemed to equal 96.75%
multiplied by a fraction, the numerator of which is the Current Principal Amount
of such Certificate and the denominator of which is the aggregate Current
Principal Amount of all the Certificates; provided, however, the percentage in
clause (iii) above shall be increased by 1.0% upon the retirement of each Class
of Interest Only Certificates.
FRAUD COVERAGE TERMINATION DATE: Group I Fraud Coverage Termination
Date or Group II Fraud Coverage Termination Date.
FRAUD LOSS: With respect to any Mortgage Loan, any Realized Loss
attributable to fraud in the origination of such Mortgage Loan, as reported by
the applicable Servicer to the Master Servicer.
FRAUD LOSS AMOUNT: Group I Fraud Loss Amount or Group II Fraud Loss
Amount.
XXXXXXX MAC: Xxxxxxx Mac, formerly the Federal Home Loan Mortgage
Corporation, or any successor thereto.
GLOBAL CERTIFICATE: Any Non-Offered Certificate registered in the name
of the Depository or its nominee, beneficial interests in which are reflected on
the books of the Depository or on the books of a Person maintaining an account
with such Depository (directly or as an indirect participant in accordance with
the rules of such depository).
GMAC: GMAC Mortgage Corporation, or its successor in interest.
GMACM SERVICING AGREEMENT: The Servicing Agreement, dated as of
November 1, 2004, between the Depositor and GMAC, attached hereto as Exhibit
H-5, and as modified by the related Assignment Agreement.
GREENPOINT: GreenPoint Mortgage Funding, Inc., or its successor in
interest.
GREENPOINT SERVICING AGREEMENT: The Mortgage Loan Purchase and
Servicing Agreement, dated as of September 1, 2003, between the Seller and
GreenPoint, attached hereto as Exhibit H-6, and as modified by the related
Assignment Agreement.
GROUP I ADJUSTMENT AMOUNT: For each anniversary of the Cut-off Date,
the amount, if any, by which the Group I Special Hazard Loss Amount (without
giving effect to the deduction of the Group I Adjustment Amount for such
anniversary) exceeds the lesser of (A) an amount calculated by the Seller and
approved by the related Rating Agencies, which amount shall not be less than
$500,000, and (B) the greater of (x) 1.0% (or if greater than 1.0%, the highest
percentage of Group I Mortgage Loans by principal balance secured by Mortgaged
Properties in any California zip code) of the outstanding principal balance of
all Group I Mortgage Loans on the Distribution Date immediately preceding such
anniversary and (y) twice the outstanding principal balance of the Group I
Mortgage Loan which has the largest outstanding principal balance on the
Distribution Date immediately preceding such anniversary.
GROUP I ALLOCABLE SHARE: With respect to any Class of Group I
Subordinate Certificates on any Distribution Date will generally equal such
Class's pro rata share (based on the Current Principal Amount of each Class
entitled thereto) of the sum of each of the components of the definition of
Group I Subordinate Optimal Principal Amount for each Subgroup; provided, that
except as described in the succeeding sentence, no Class of Group I Subordinate
Certificates (other than the Class of Group I Subordinate Certificates
outstanding with the lowest numerical designation) shall be entitled on any
Distribution Date to receive distributions pursuant to clauses (2), (3) and (5)
of the definition of Group I Subordinate Optimal Principal Amount unless the
Class Prepayment Distribution Trigger for the related Class is satisfied for
such Distribution Date. If on any Distribution Date the Current Principal Amount
of any Class of Group I Subordinate Certificates for which the related Class
Prepayment Distribution Trigger was satisfied on such Distribution Date is
reduced to zero, any amounts distributable to such Class pursuant to clauses
(2), (3) and (5) of the definition of Group I Subordinate Optimal Principal
Amount, to the extent of such Class's remaining Group I Allocable Share, shall
be distributed to the remaining Classes of Group I Subordinate Certificates in
reduction of their respective Current Principal Amounts, sequentially, in the
order of their numerical Class designations.
GROUP I AVAILABLE FUNDS: For any Distribution Date and Loan Group I, an
amount which generally includes, (1) all previously undistributed payments on
account of principal (including the principal portion of Monthly Payments,
Principal Prepayments and the principal amount of Net Liquidation Proceeds) and
all previously undistributed payments on account of interest received after the
Cut-Off Date and on or prior to the related Determination Date, (2) any Monthly
Advances and Compensating Interest made by the Master Servicer or a Servicer for
such Distribution Date in respect of the Group I Mortgage Loans and (3) any
amounts reimbursed by the Master Servicer in connection with losses on certain
eligible investments, net of Loan Group I's pro rata share (based on the
aggregate Scheduled Principal Balance) of all fees payable to, and amounts
reimbursable to, the Servicers, the Master Servicer, the Securities
Administrator, the Trustee and the Custodian as provided in this Agreement and
the Custodial Agreement and investment earnings on amounts on deposit in the
Master Servicer Collection Account and the Distribution Account.
GROUP I BANKRUPTCY COVERAGE TERMINATION DATE: The Distribution Date
upon which the Group I Bankruptcy Loss Amount has been reduced to zero or a
negative number (or the Group I Cross-Over Date, if earlier).
GROUP I BANKRUPTCY LOSS AMOUNT: On each Distribution Date, $150,000,
subject to reduction as described in this Agreement, minus the aggregate amount
of previous Bankruptcy Losses with respect to the Group I Mortgage Loans.
GROUP I CERTIFICATES: The Group I Offered Certificates and Group I
Non-Offered Certificates.
GROUP I CROSS-OVER DATE: The Distribution Date on which the Current
Principal Amounts of the Group I Subordinate Certificates are reduced to zero.
GROUP I FRAUD COVERAGE TERMINATION DATE: The Distribution Date upon
which the Group I Fraud Loss Amount has been reduced to zero or a negative
number (or the Group I Cross-Over Date, if earlier).
GROUP I FRAUD LOSS AMOUNT: Upon the initial issuance of the Group I
Certificates and as of any Distribution Date prior to the first anniversary of
the Cut-Off Date, 3% of the aggregate Scheduled Principal Balances of the Group
I Mortgage Loans. As of any Distribution Date from the first and through the
second anniversary of the Cut-off Date, (1) the lesser of (a) the Group I Fraud
Loss Amount as of the most recent anniversary of the Cut-off Date and (b) 2% of
the aggregate outstanding principal balance of all Group I Mortgage Loans as of
the most recent anniversary of the Cut-off Date minus (2) the Fraud Losses that
would have been allocated to the Group I Subordinate Certificates in the absence
of the Group I Loss Allocation Limit since the most recent anniversary of the
Cut-off Date. As of any Distribution Date from the second and through the fifth
anniversary of the Cut-off Date, (1) the lesser of (a) the Group I Fraud Loss
Amount as of the most recent anniversary of the Cut-off Date and (b) 1% of the
aggregate outstanding principal balance of all Group I Mortgage Loans as of the
most recent anniversary of the Cut-off Date minus (2) the Fraud Losses that
would have been allocated to the Group I Subordinate Certificates in the absence
of the Group I Loss Allocation Limit since the most recent anniversary of the
Cut-off Date. After the fifth anniversary of the Cut-off Date, the Group I Fraud
Loss Amount shall be zero.
GROUP I LOSS ALLOCATION LIMIT: The meaning specified in Subsection
6.03(a)(iv) hereof.
GROUP I MORTGAGE LOANS: The Mortgage Loans included as part of Loan
Group I on the Mortgage Loan Schedule.
GROUP I NON-OFFERED CERTIFICATES: The Class I-B-4, Class I-B-5 and
Class I-B-6 Certificates.
GROUP I OFFERED CERTIFICATES: The Group I Senior Certificates and Group
I Offered Subordinate Certificates.
GROUP I OFFERED SUBORDINATE CERTIFICATES: The Class I-B-1, Class I-B-2
and Class I-B-3 Certificates.
GROUP I ORIGINAL SUBORDINATE PRINCIPAL BALANCE: The aggregate Current
Principal Amount of the Group I Subordinate Certificates as of the Closing Date.
GROUP I SENIOR CERTIFICATES: The Class I-A-1, Class I-A-2, Class I-A-3,
Class I-PO, Class I-X, Class I-R-1 and Class I-R-2 Certificates.
GROUP I SPECIAL HAZARD LOSS AMOUNT: Upon the initial issuance of the
Group I Certificates, approximately $2,690,310. As of any Distribution Date, the
Group I Special Hazard Loss Amount will equal the initial Group I Special Hazard
Loss Amount, minus the sum of (i) the aggregate amount of Special Hazard Losses
that would have been previously allocated to the Group I Subordinate
Certificates in the absence of the Group I Loss Allocation Limit and (ii) the
Group I Adjustment Amount.
GROUP I SPECIAL HAZARD TERMINATION DATE: The Distribution Date upon
which the Group I Special Hazard Loss Amount has been reduced to zero or a
negative number (or the Group I Cross-Over Date, if earlier).
GROUP I SUBORDINATE CERTIFICATE WRITEDOWN AMOUNT: With respect to the
Group I Subordinate Certificates, the amount by which (x) the sum of the Current
Principal Amounts of the Group I Certificates (after giving effect to the
distribution of principal and the allocation of Realized Losses in reduction of
the Current Principal Amounts of the Group I Certificates on such Distribution
Date) exceeds (y) the Scheduled Principal Balances of the Group I Mortgage Loans
on the Due Date related to such Distribution Date.
GROUP I SUBORDINATE CERTIFICATES: The Group I Offered Subordinate
Certificates and Group I Non-Offered Certificates.
GROUP I SUBORDINATE OPTIMAL PRINCIPAL AMOUNT: With respect to the Group
I Subordinate Certificates and each Distribution Date, an amount equal to the
sum of the following from each Subgroup (but in no event greater than the
aggregate Current Principal Amount of the Group I Subordinate Certificates
immediately prior to such Distribution Date):
(i) the Group I Subordinate Percentage of the Non-PO
Percentage of the principal portion of all Monthly Payments due on each Group I
Mortgage Loan in the related Subgroup on the related Due Date, as specified in
the amortization schedule at the time applicable thereto (after adjustment for
previous principal prepayments but before any adjustment to such amortization
schedule by reason of any bankruptcy or similar proceeding or any moratorium or
similar waiver or grace period);
(ii) the Group I Subordinate Prepayment Percentage of the
Non-PO Percentage of the Scheduled Principal Balance of each Group I Mortgage
Loan in the related Subgroup which was the subject of a prepayment in full
received by the Master Servicer during the applicable Prepayment Period;
(iii) the Group I Subordinate Prepayment Percentage of the
Non-PO Percentage of all partial prepayments of principal received during the
applicable Prepayment Period for each Group I Mortgage Loan in the related
Subgroup;
(iv) the excess, if any, of (a) the Net Liquidation Proceeds
allocable to principal received during the related Prepayment Period in respect
of each Liquidated Mortgage Loan in the related Subgroup over (b) the sum of the
amounts distributable to the holders of the Group I Senior Certificates pursuant
to clause (4) of the definition of "Subgroup Principal Distribution Amount" and
"Class I-PO Certificate Principal Distribution Amount" on such Distribution
Date;
(v) the Group I Subordinate Prepayment Percentage of the
Non-PO Percentage of the sum of (a) the Scheduled Principal Balance of each
Group I Mortgage Loan in the related Subgroup which was repurchased by the
Seller in connection with such Distribution Date and (b) the difference, if any,
between the Scheduled Principal Balance of a Group I Mortgage Loan in the
related Subgroup that has been replaced by the Seller with a substitute Group I
Mortgage Loan pursuant to the Mortgage Loan Purchase Agreement in connection
with such Distribution Date and the Scheduled Principal Balance of such
substitute Mortgage Loan; and
(vi) on the Distribution Date on which the Current Principal
Amounts of the Group I Senior Certificates (other than the Class I-X
Certificates and Class I-PO Certificates) have all been reduced to zero, 100% of
any Subgroup Principal Distribution Amount.
GROUP I SUBORDINATE PERCENTAGE: As of any Distribution Date and with
respect to any Subgroup, 100% minus the related Subgroup Senior Percentage for
the Group I Senior Certificates related to such Subgroup. The initial Group I
Subordinate Percentage for each Subgroup will be equal to approximately 1.61%.
GROUP I SUBORDINATE PREPAYMENT PERCENTAGE: As of any Distribution Date
and with respect to any Subgroup, 100% minus the related Subgroup Senior
Prepayment Percentage for such Subgroup, except that on any Distribution Date
after the Current Principal Amount of each Class of Group I Senior Certificates
have each been reduced to zero, the Group I Subordinate Prepayment Percentage
for the Group I Subordinate Certificates with respect to such Subgroup will
equal 100%.
GROUP II ADJUSTMENT AMOUNT: For each anniversary of the Cut-off Date,
the amount, if any, by which the Group II Special Hazard Loss Amount (without
giving effect to the deduction of the Group II Adjustment Amount for such
anniversary) exceeds the lesser of (A) an amount calculated by the Seller and
approved by the related Rating Agencies, which amount shall not be less than
$500,000, and (B) the greater of (x) 1.0% (or if greater than 1.0%, the highest
percentage of Group II Mortgage Loans by principal balance secured by Mortgaged
Properties in any California zip code) of the outstanding principal balance of
all Group II Mortgage Loans on the Distribution Date immediately preceding such
anniversary and (y) twice the outstanding principal balance of the Group II
Mortgage Loan which has the largest outstanding principal balance on the
Distribution Date immediately preceding such anniversary.
GROUP II ALLOCABLE SHARE: With respect to any Class of Group II
Subordinate Certificates (other than the Class II-XB Certificates) on any
Distribution Date will generally equal such Class's pro rata share (based on the
Current Principal Amount of each Class entitled thereto) of the sum of each of
the components of the definition of Group II Subordinate Optimal Principal
Amount; provided, that except as described in the succeeding sentence, no Class
of Group II Subordinate Certificates (other than the Class II-XB Certificates
and the Class of Group II Subordinate Certificates outstanding with the lowest
numerical designation) shall be entitled on any Distribution Date to receive
distributions pursuant to clauses (2), (3) and (5) of the definition of Group II
Subordinate Optimal Principal Amount unless the Class Prepayment Distribution
Trigger for the related Class is satisfied for such Distribution Date. If on any
Distribution Date the Current Principal Amount of any Class of Group II
Subordinate Certificates (other than the Class II-XB Certificates) for which the
related Class Prepayment Distribution Trigger was satisfied on such Distribution
Date is reduced to zero, any amounts distributable to such Class pursuant to
clauses (2), (3) and (5) of the definition of Group II Subordinate Optimal
Principal Amount, to the extent of such Class's remaining Group II Allocable
Share, shall be distributed to the remaining Classes of Group II Subordinate
Certificates (other than the Class II-XB Certificates) in reduction of their
respective Current Principal Amounts, sequentially, in the order of their
numerical Class designations.
GROUP II AVAILABLE FUNDS: For any Distribution Date and Loan Group II,
an amount which generally includes, (1) all previously undistributed payments on
account of principal (including the principal portion of Monthly Payments,
Principal Prepayments and the principal amount of Net Liquidation Proceeds) and
all previously undistributed payments on account of interest received after the
Cut-Off Date and on or prior to the related Determination Date, (2) any Monthly
Advances and Compensating Interest made by the Master Servicer or a Servicer for
such Distribution Date in respect of the Group II Mortgage Loans and (3) any
amounts reimbursed by the Master Servicer in connection with losses on certain
eligible investments, net of Loan Group II's pro rata share (based on the
aggregate Scheduled Principal Balance) of all fees payable to, and amounts
reimbursable to, the Servicers, the Master Servicer, the Securities
Administrator, the Trustee and the Custodian as provided in this Agreement and
the Custodial Agreement and investment earnings on amounts on deposit in the
Master Servicer Collection Account and the Distribution Account.
GROUP II BANKRUPTCY COVERAGE TERMINATION DATE: The Distribution Date
upon which the Group II Bankruptcy Loss Amount has been reduced to zero or a
negative number (or the Group II Cross-Over Date, if earlier).
GROUP II BANKRUPTCY LOSS AMOUNT: On each Distribution Date, $150,000,
subject to reduction as described in the Agreement, minus the aggregate amount
of previous Bankruptcy Losses with respect to the Group II Mortgage Loans.
GROUP II CERTIFICATES: The Group II Offered Certificates and Group II
Non-Offered Certificates.
GROUP II CROSS-OVER DATE: The Distribution Date on which the Current
Principal Amounts of the Group II Subordinate Certificates are reduced to zero.
GROUP II FRAUD COVERAGE TERMINATION DATE: The Distribution Date upon
which the Group II Fraud Loss Amount has been reduced to zero or a negative
number (or the Group II Cross-Over Date, if earlier).
GROUP II FRAUD LOSS AMOUNT: Upon the initial issuance of the Group II
Certificates and as of any Distribution Date prior to the first anniversary of
the Cut-Off Date, 3% of the aggregate Scheduled Principal Balances of the Group
II Mortgage Loans. As of any Distribution Date from the first and through the
second anniversary of the Cut-off Date, (1) the lesser of (a) the Group II Fraud
Loss Amount as of the most recent anniversary of the Cut-off Date and (b) 2% of
the aggregate outstanding principal balance of all Group II Mortgage Loans as of
the most recent anniversary of the Cut-off Date minus (2) the Fraud Losses that
would have been allocated to the Group II Subordinate Certificates in the
absence of the Group II Loss Allocation Limit since the most recent anniversary
of the Cut-off Date. As of any Distribution Date from the second and through the
fifth anniversary of the Cut-off Date, (1) the lesser of (a) the Group II Fraud
Loss Amount as of the most recent anniversary of the Cut-off Date and (b) 1% of
the aggregate outstanding principal balance of all Group II Mortgage Loans as of
the most recent anniversary of the Cut-off Date minus (2) the Fraud Losses that
would have been allocated to the Group II Subordinate Certificates in the
absence of the Group II Loss Allocation Limit since the most recent anniversary
of the Cut-off Date. After the fifth anniversary of the Cut-off Date, the Group
II Fraud Loss Amount shall be zero.
GROUP II LOSS ALLOCATION LIMIT: The meaning specified in Subsection
6.03(b)(ii) hereof.
GROUP II MORTGAGE LOANS: The Mortgage Loans included as part of Loan
Group II on the Mortgage Loan Schedule.
GROUP II NON-OFFERED CERTIFICATES: The Class II-B-4, Class II-B-5 and
Class II-B-6 Certificates.
GROUP II OFFERED CERTIFICATES: The Group II Senior Certificates and
Group II Offered Subordinate Certificates.
GROUP II OFFERED SUBORDINATE CERTIFICATES: The Class II-B-1, Class
II-B-2, Class II-B-3 and Class II-XB Certificates.
GROUP II ORIGINAL SUBORDINATE PRINCIPAL BALANCE: The aggregate Current
Principal Amount of the Group II Subordinate Certificates as of the Closing
Date.
GROUP II SENIOR CERTIFICATES: The Class II-A-1, Class II-X and Class
II-R-1 Certificates.
GROUP II SENIOR OPTIMAL PRINCIPAL AMOUNT: With respect to the Group II
Senior Certificates and each Distribution Date, an amount equal to the sum of
the following (but in no event greater than the aggregate Current Principal
Amounts of the Group II Senior Certificates immediately prior to such
Distribution Date):
(1) the Group II Senior Percentage of the principal portion of
all Monthly Payments due on the Group II Mortgage Loans on the related
Due Date, as specified in the amortization schedule at the time
applicable thereto (after adjustment for previous principal
prepayments but before any adjustment to such amortization schedule by
reason of any bankruptcy or similar proceeding or any moratorium or
similar waiver or grace period);
(2) the Group II Senior Prepayment Percentage of the Scheduled
Principal Balance of each Group II Mortgage Loan which was the subject
of a prepayment in full received by the Master Servicer during the
applicable Prepayment Period;
(3) the Group II Senior Prepayment Percentage of all partial
prepayments allocated to principal received during the applicable
Prepayment Period;
(4) the lesser of (a) the Group II Senior Prepayment
Percentage of the sum of (i) all Net Liquidation Proceeds allocable to
principal received in respect of each Group II Mortgage Loan which
became a Liquidated Mortgage Loan during the related Prepayment Period
(other than Group II Mortgage Loans described in the immediately
following clause (ii)) and all Subsequent Recoveries received in
respect of each Liquidated Mortgage Loan during the related Due Period
and (ii) the Scheduled Principal Balance of each such Group II
Mortgage Loan purchased by an insurer from the Trustee during the
related Prepayment Period pursuant to the related primary mortgage
insurance policy, if any, or otherwise; and (b) the Group II Senior
Percentage of the sum of (i) the Scheduled Principal Balance of each
Group II Mortgage Loan which became a Liquidated Mortgage Loan during
the related Prepayment Period (other than the Group II Mortgage Loans
described in the immediately following clause (ii)) and all Subsequent
Recoveries received in respect of each Liquidated Mortgage Loan during
the related Due Period and (ii) the Scheduled Principal Balance of
each such Group II Mortgage Loan that was purchased by an insurer from
the Trustee during the related Prepayment Period pursuant to the
related primary mortgage insurance policy, if any or otherwise; and
(5) the Group II Senior Prepayment Percentage of the sum of
(a) the Scheduled Principal Balance of each Group II Mortgage Loan
which was repurchased by the Seller in connection with such
Distribution Date and (b) the excess, if any, of the Scheduled
Principal Balance of each Group II Mortgage Loan that has been
replaced by the Seller with a substitute Group II Mortgage Loan
pursuant to the Mortgage Loan Purchase Agreement in connection with
such Distribution Date over the Scheduled Principal Balance of each
such substitute Group II Mortgage Loan.
GROUP II SENIOR PERCENTAGE: The lesser of (a) 100% and (b) the
percentage (carried to six places rounded up) obtained by dividing the Current
Principal Amount of the Group II Senior Certificates, immediately prior to such
Distribution Date, by the aggregate Scheduled Principal Balance of the Group II
Mortgage Loans as of the beginning of the related Due Period. The initial Group
II Senior Percentage will be approximately 94.75%.
GROUP II SENIOR PREPAYMENT PERCENTAGE: On any Distribution Date
occurring during the periods set forth below will be as follows:
PERIOD (DATES INCLUSIVE) GROUP II SENIOR PREPAYMENT PERCENTAGE
------------------------ -------------------------------------
July 25, 2005 - June 25, 2010 100%
July 25, 2010 - June 25, 2011 Group II Senior Percentage plus 70% of the Group II
Subordinate Percentage.
July 25, 2011 - June 25, 2012 Group II Senior Percentage plus 60% of the Group II
Subordinate Percentage.
July 25, 2012 - June 25, 2013 Group II Senior Percentage plus 40% of the Group II
Subordinate Percentage
July 25, 2013 - June 25, 2014 Group II Senior Percentage plus 20% of the Group II
Subordinate Percentage.
July 25, 2014 and thereafter Group II Senior Percentage.
Any scheduled reduction to the Group II Senior Prepayment Percentage
shall not be made as of any Distribution Date unless, as of the last day of the
month preceding such Distribution Date (1) the aggregate Scheduled Principal
Balance of the Group II Mortgage Loans delinquent 60 days or more (including for
this purpose any such Group II Mortgage Loans in foreclosure and such Group II
Mortgage Loans with respect to which the related Mortgaged Property has been
acquired by the trust) averaged over the last six months, as a percentage of the
aggregate Current Principal Amount of the Group II Subordinate Certificates does
not exceed 50% and (2) cumulative Realized Losses on the Group II Mortgage Loans
do not exceed (a) 30% of the aggregate Current Principal Amount of the Group II
Original Subordinate Principal Balance if such Distribution Date occurs between
and including July 2010 and June 2011, (b) 35% of the Group II Original
Subordinate Principal Balance if such Distribution Date occurs between and
including July 2011 and June 2012, (c) 40% of the Group II Original Subordinate
Principal Balance if such Distribution Date occurs between and including July
2012 and June 2013, (d) 45% of the Group II Original Subordinate Principal
Balance if such Distribution Date occurs between and including July 2013 and
June 2014, and (e) 50% of the Group II Original Subordinate Principal Balance if
such Distribution Date occurs during or after July 2014.
Notwithstanding the foregoing, if on any Distribution Date, the
percentage the numerator of which is the aggregate Current Principal Amount of
the Group II Senior Certificates (other than the Class II-X Certificates)
immediately preceding such Distribution Date, and the denominator of which is
the Scheduled Principal Balance of the Group II Mortgage Loans as of the
beginning of the related Due Period, exceeds such percentage as of the Cut-off
Date, then the Group II Senior Prepayment Percentage with respect to the Group
II Senior Certificates for such Distribution Date will equal 100%.
GROUP II SPECIAL HAZARD LOSS AMOUNT: Upon the initial issuance of the
Group II Certificates, approximately $1,953,350. As of any Distribution Date,
the Group II Special Hazard Loss Amount will equal the initial Group II Special
Hazard Loss Amount, minus the sum of (i) the aggregate amount of Special Hazard
Losses that would have been previously allocated to the Group II Subordinate
Certificates in the absence of the Group II Loss Allocation Limit and (ii) the
Group II Adjustment Amount.
GROUP II SPECIAL HAZARD TERMINATION DATE: The Distribution Date upon
which the Group II Special Hazard Loss Amount has been reduced to zero or a
negative number (or the Group II Cross-Over Date, if earlier).
GROUP II SUBORDINATE CERTIFICATE WRITEDOWN AMOUNT: With respect to the
Group II Subordinate Certificates, the amount by which (x) the sum of the
Current Principal Amounts of the Group II Certificates (after giving effect to
the distribution of principal and the allocation of Realized Losses in reduction
of the Current Principal Amounts of the Group II Certificates, other than the
Class II-XB Certificates, on such Distribution Date) exceeds (y) the Scheduled
Principal Balances of the Group II Mortgage Loans on the Due Date related to
such Distribution Date.
GROUP II SUBORDINATE CERTIFICATES: The Group II Offered Subordinate
Certificates and Group II Non-Offered Certificates.
GROUP II SUBORDINATE OPTIMAL PRINCIPAL AMOUNT: With respect to the
Group II Subordinate Certificates (other than the Class II-XB Certificates) and
each Distribution Date will be an amount equal to the sum of the following (but
in no event greater than the aggregate Current Principal Amount of the Group II
Subordinate Certificates (other than the Class II-XB Certificates) immediately
prior to such Distribution Date):
(i) the Group II Subordinate Percentage of the principal
portion of all Monthly Payments due on each Group II Mortgage Loan on the
related Due Date, as specified in the amortization schedule at the time
applicable thereto (after adjustment for previous principal prepayments but
before any adjustment to such amortization schedule by reason of any bankruptcy
or similar proceeding or any moratorium or similar waiver or grace period);
(ii) the Group II Subordinate Prepayment Percentage of the
Scheduled Principal Balance of each Group II Mortgage Loan which was the subject
of a prepayment in full received by the Master Servicer during the applicable
Prepayment Period;
(iii) the Group II Subordinate Prepayment Percentage of all
partial prepayments of principal received during the applicable Prepayment
Period for each Group II Mortgage Loan;
(iv) the excess, if any, of (a) the Net Liquidation Proceeds
allocable to principal received during the related Prepayment Period in respect
of each Liquidated Mortgage Loan in Loan Group II over (b) the sum of the
amounts distributable to the holders of the Group II Senior Certificates
pursuant to clause (4) of the definition of "Group II Senior Optimal Principal
Amount" on such Distribution Date;
(v) the Group II Subordinate Prepayment Percentage of (a) the
Scheduled Principal Balance of each Group II Mortgage Loan which was repurchased
by the Seller in connection with such Distribution Date and (b) the difference,
if any, between the Scheduled Principal Balance of a Group II Mortgage Loan that
has been replaced by the Seller with a substitute Group II Mortgage Loan
pursuant to the Mortgage Loan Purchase Agreement in connection with such
Distribution Date and the Scheduled Principal Balance of such substitute
Mortgage Loan; and
(vi) on the Distribution Date on which the Current Principal
Amounts of the Group II Senior Certificates have all been reduced to zero, 100%
of any Group II Senior Optimal Principal Amount.
GROUP II SUBORDINATE PERCENTAGE: As of any Distribution Date and with
respect to Group II Certificates, 100% minus the Group II Senior Percentage for
the Group II Senior Certificates. The initial Group II Subordinate Percentage
will be equal to approximately 5.25%.
GROUP II SUBORDINATE PREPAYMENT PERCENTAGE: As of any Distribution Date
and with respect to Group II Certificates, 100% minus the Group II Senior
Prepayment Percentage, except that on any Distribution Date after the Current
Principal Amount of each Class of Group II Senior Certificates have each been
reduced to zero, the Group II Subordinate Prepayment Percentage for the Group II
Subordinate Certificates will equal 100%.
HOLDER: The Person in whose name a Certificate is registered in the
related Certificate Register, except that, subject to Subsections 11.02(b) and
11.05(e), solely for the purpose of giving any consent pursuant to this
Agreement, any Certificate registered in the name of the Depositor, the Master
Servicer or the Trustee or any Affiliate thereof shall be deemed not to be
outstanding and the Fractional Undivided Interest evidenced thereby shall not be
taken into account in determining whether the requisite percentage of Fractional
Undivided Interests necessary to effect any such consent has been obtained.
INDEMNIFIED PERSONS: The Trustee, the Master Servicer, the Custodian
and the Securities Administrator and their officers, directors, agents and
employees and, with respect to the Trustee, any separate co-trustee and its
officers, directors, agents and employees.
INDEPENDENT: When used with respect to any specified Person, this term
means that such Person (a) is in fact independent of the Depositor or the Master
Servicer and of any Affiliate of the Depositor or the Master Servicer, (b) does
not have any direct financial interest or any material indirect financial
interest in the Depositor or the Master Servicer or any Affiliate of the
Depositor or the Master Servicer and (c) is not connected with the Depositor or
the Master Servicer or any Affiliate as an officer, employee, promoter,
underwriter, trustee, partner, director or person performing similar functions.
INDIVIDUAL CERTIFICATE: Any Non-Offered Certificate registered in the
name of the Holder other than the Depository or its nominee.
INITIAL CERTIFICATION: The certification substantially in the form of
Exhibit One to the Custodial Agreement.
INSTITUTIONAL ACCREDITED INVESTOR: Any Person meeting the requirements
of Rule 501(a)(l), (2), (3) or (7) of Regulation D under the Securities Act or
any entity all of the equity holders in which come within such paragraphs.
INSURANCE POLICY: With respect to any Mortgage Loan, any standard
hazard insurance policy, flood insurance policy or title insurance policy.
INSURANCE PROCEEDS: Amounts paid by the insurer under any Insurance
Policy covering any Mortgage Loan or Mortgaged Property other than amounts
required to be paid over to the Mortgagor pursuant to law or the related
Mortgage Note or Security Instrument and other than amounts used to repair or
restore the Mortgaged Property or to reimburse insured expenses.
INTEREST ACCRUAL PERIOD: For each Class of Certificates and for any
Distribution Date, the calendar month preceding the month in which such
Distribution Date occurs.
INTEREST DETERMINATION DATE: With respect to each Distribution Date,
the second LIBOR Business Day immediately preceding the commencement of the
related Interest Accrual Period.
INTEREST ONLY CERTIFICATES: The Class I-X, Class II-X and Class II-XB
Certificates.
INTEREST SHORTFALL: With respect to any Distribution Date and each
Mortgage Loan that during the related Prepayment Period was the subject of a
Principal Prepayment or constitutes a Relief Act Mortgage Loan, an amount
determined as follows:
(A) Partial principal prepayments received during the relevant
Prepayment Period: The difference between (i) one month's interest at the
applicable Net Mortgage Rate on the amount of such prepayment and (ii) the
amount of interest for the calendar month of such prepayment (adjusted to the
applicable Net Mortgage Rate) received at the time of such prepayment;
(B) Principal prepayments in full received during the relevant
Prepayment Period: The difference between (i) one month's interest at the
applicable Net Mortgage Rate on the Scheduled Principal Balance of such Mortgage
Loan immediately prior to such prepayment and (ii) the amount of interest for
the calendar month of such prepayment (adjusted to the applicable Net Mortgage
Rate) received at the time of such prepayment; and
(C) As to any Relief Act Mortgage Loan, the excess of (i) 30 days'
interest (or, in the case of a principal prepayment in full, interest to the
date of prepayment) on the Scheduled Principal Balance thereof (or, in the case
of a principal prepayment in part, on the amount so prepaid) at the related Net
Mortgage Rate over (ii) 30 days' interest (or, in the case of a principal
prepayment in full, interest to the date of prepayment) on such Scheduled
Principal Balance (or, in the case of a Principal Prepayment in part, on the
amount so prepaid) at the Net Mortgage Rate required to be paid by the Mortgagor
as limited by application of the Relief Act.
INTERIM CERTIFICATION: The certification substantially in the form of
Exhibit Two to the Custodial Agreement.
INVESTMENT LETTER: The letter to be furnished by each Institutional
Accredited Investor which purchases any of the Class I-B-4, Class I-B-5 or Class
I-B-6 Certificates in connection with such purchase, substantially in the form
set forth as Exhibit F-1 hereto.
ISSUER: Prime Mortgage Trust 2005-2.
LENDER-PAID PMI RATE: With respect to each Mortgage Loan covered by a
lender-paid primary mortgage insurance policy, the amount payable to the related
insurer, as stated in the Mortgage Loan Schedule.
LIBOR: With respect to any Distribution Date, the arithmetic mean of
the London interbank offered rate quotations for one-month U.S. Dollar deposits,
expressed on a per annum basis, determined in accordance with Section 1.02.
LIBOR BUSINESS DAY: Any day other than (i) a Saturday or Sunday or (ii)
a day on which banking institutions in London, England and New York City are
required or authorized to by law to be closed.
LIQUIDATED MORTGAGE LOAN: Any defaulted Mortgage Loan as to which the
related Servicer or the Master Servicer has determined that all amounts it
expects to recover from or on account of such Mortgage Loan have been recovered.
LIQUIDATION DATE: With respect to any Liquidated Mortgage Loan, the
date on which the Master Servicer or the related Servicer has certified that
such Mortgage Loan has become a Liquidated Mortgage Loan.
LIQUIDATION EXPENSES: With respect to a Mortgage Loan in liquidation,
unreimbursed expenses paid or incurred by or for the account of the Master
Servicer or the related Servicer in connection with the liquidation of such
Mortgage Loan and the related Mortgage Property, such expenses including (a)
property protection expenses, (b) property sales expenses, (c) foreclosure and
sale costs, including court costs and reasonable attorneys' fees, and (d)
similar expenses reasonably paid or incurred in connection with liquidation.
LIQUIDATION PROCEEDS: Cash received in connection with the liquidation
of a defaulted Mortgage Loan, whether through trustee's sale, foreclosure sale,
Insurance Proceeds, condemnation proceeds or otherwise and any Subsequent
Recoveries.
LOAN GROUP: Any of Loan Group I or Loan Group II.
LOAN GROUP I: The Mortgage Loans identified as part of Loan Group I on
the Mortgage Loan Schedule.
LOAN GROUP II: The Mortgage Loans identified as part of Loan Group II
on the Mortgage Loan Schedule.
LOAN-TO-VALUE RATIO: With respect to any Mortgage Loan, the fraction,
expressed as a percentage, the numerator of which is the original principal
balance of the related Mortgage Loan and the denominator of which is the
Original Value of the related Mortgaged Property.
LOSS ALLOCATION LIMIT: Group I Loss Allocation Limit or Group II Loss
Allocation Limit.
LOSS SEVERITY PERCENTAGE: With respect to any Distribution Date, the
percentage equivalent of a fraction, the numerator of which is the amount of
Realized Losses incurred on a Mortgage Loan and the denominator of which is the
Scheduled Principal Balance of such Mortgage Loan immediately prior to the
liquidation of such Mortgage Loan.
LOST NOTES: The original Mortgage Notes that have been lost, as
indicated on the Mortgage Loan Schedule.
MASTER SERVICER: As of the Closing Date, Xxxxx Fargo Bank, N.A. and,
thereafter, its respective successors in interest who meet the qualifications of
the Servicing Agreements and this Agreement.
MASTER SERVICER CERTIFICATION: A written certification covering
servicing of the Mortgage Loans by the Servicers and signed by an officer of the
Master Servicer that complies with (i) the Xxxxxxxx-Xxxxx Act of 2002, as
amended from time to time, and (ii) the February 21, 2003 Statement by the Staff
of the Division of Corporation Finance of the Securities and Exchange Commission
Regarding Compliance by Asset-Backed Issuers with Exchange Act Rules 13a-14 and
15d-14, as in effect from time to time; provided that if, after the Closing Date
(a) the Xxxxxxxx-Xxxxx Act of 2002 is amended, (b) the Statement referred to in
clause (ii) is modified or superceded by any subsequent statement, rule or
regulation of the Securities and Exchange Commission or any statement of a
division thereof, or (c) any future releases, rules and regulations are
published by the Securities and Exchange Commission from time to time pursuant
to the Xxxxxxxx-Xxxxx Act of 2002, which in any such case affects the form or
substance of the required certification and results in the required
certification being, in the reasonable judgment of the Master Servicer,
materially more onerous than the form of the required certification as of the
Closing Date, the Master Servicer Certification shall be as agreed to by the
Master Servicer and the Depositor following a negotiation in good faith to
determine how to comply with any such new requirements.
MASTER SERVICER COLLECTION ACCOUNT: The trust account or accounts
created and maintained pursuant to Section 4.02, which shall be denominated
"U.S. Bank National Association, as Trustee f/b/o holders of Structured Asset
Mortgage Investments II Inc., Prime Mortgage Trust, Certificates, Series 2005-2
- Master Servicer Collection Account." The Master Servicer Collection Account
shall be an Eligible Account.
MASTER SERVICING COMPENSATION: The meaning specified in Section 3.14.
MASTER SERVICING FEE: As to each Mortgage Loan and any Distribution
Date, an amount payable out of each full payment of interest received on such
Mortgage Loan and equal to the sum of (i) one-twelfth of the Master Servicing
Fee Rate multiplied by the Scheduled Principal Balance of such Mortgage Loan as
of the first day of the related Due Period, subject to reduction as provided in
Section 3.14.
MASTER SERVICING FEE RATE: With respect to each Mortgage Loan, 0.0175%
per annum.
MATERIAL DEFECT: The meaning specified in Section 2.02(a).
MERS: Mortgage Electronic Registration Systems, Inc., a corporation
organized and existing under the laws of the State of Delaware, or any successor
thereto.
MERS(R) SYSTEM: The system of recording transfers of Mortgages
electronically maintained by MERS.
MIN: The Mortgage Identification Number for Mortgage Loans registered
with MERS on the MERS(R) System.
MOM LOAN: With respect to any Mortgage Loan, MERS acting as the
mortgagee of such Mortgage Loan, solely as nominee for the originator of such
Mortgage Loan and its successors and assigns, at the origination thereof, or as
nominee for any subsequent assignee of the originator pursuant to an assignment
of mortgage to MERS.
MONTHLY ADVANCE: An advance of principal or interest required to be
made by the applicable Servicer pursuant to the related Servicing Agreement or
the Master Servicer pursuant to Section 6.06.
MOODY'S: Xxxxx'x Investors Service, Inc. or its successor in interest.
MORTGAGE FILE: The mortgage documents listed in Section 2.01(b)
pertaining to a particular Mortgage Loan and any additional documents required
to be added to the Mortgage File pursuant to this Agreement.
MORTGAGE INTEREST RATE: The annual rate at which interest accrues from
time to time on any Mortgage Loan pursuant to the related Mortgage Note, which
rate is initially equal to the "Mortgage Interest Rate" set forth with respect
thereto on the Mortgage Loan Schedule.
MORTGAGE LOAN: A mortgage loan transferred and assigned to the Trustee
pursuant to Section 2.01 or Section 2.04 and held as a part of the Trust Fund,
as identified in the Mortgage Loan Schedule (which shall include, without
limitation, (i) with respect to each Cooperative Loan, the related Mortgage
Note, Security Agreement, Assignment of Proprietary Lease, Cooperative Stock
Certificate, Cooperative Lease and Mortgage File and all rights appertaining
thereto, and (ii) with respect to each Mortgage Loan other than a Cooperative
Loan, each related Mortgage Note, Mortgage and Mortgage File and all rights
appertaining thereto), including a mortgage loan the property securing which has
become an REO Property. Notwithstanding any provision in this Agreement to the
contrary, in no event shall the term "Mortgage Loan" include any Underlying
Mortgage Loan.
MORTGAGE LOAN PURCHASE AGREEMENT: The Mortgage Loan Purchase Agreement
dated as of June 30, 2005, between EMC Mortgage Corporation, as seller, and
Structured Asset Mortgage Investments II Inc., as purchaser, and all amendments
thereof and supplements thereto, attached as Exhibit J.
MORTGAGE LOAN SCHEDULE: The schedule, attached hereto as Exhibit B with
respect to the Mortgage Loans and as amended from time to time to reflect the
repurchase or substitution of Mortgage Loans pursuant to this Agreement.
MORTGAGE NOTE: The originally executed note or other evidence of the
indebtedness of a Mortgagor under the related Mortgage Loan.
MORTGAGED PROPERTY: Land and improvements securing the indebtedness of
a Mortgagor under the related Mortgage Loan or, in the case of REO Property,
such REO Property, or, in the case of a Cooperative Loan, the related
Cooperative Lease and Cooperative Stock. In no event, however, shall the term
"Mortgaged Property" include any mortgaged property or real estate owned
property relating to an Underlying Mortgage Loan.
MORTGAGOR: The obligor on a Mortgage Note.
NATIONAL CITY: National City Mortgage Co., or its successor in
interest.
NATIONAL CITY SERVICING AGREEMENT: The Purchase, Warranties and
Servicing Agreement, dated as of October 1, 2001, between the Seller and
National City, attached hereto as Exhibit H-7, and as modified by the related
Assignment Agreement.
NAVY FEDERAL: Navy Federal Credit Union, or its successor in interest.
NAVY FEDERAL SERVICING AGREEMENT: The Purchase, Warranties and
Servicing Agreement, dated as of June 1, 2002, between the Seller and U.S.
Central Credit Union, attached hereto as Exhibit H-8, and as modified by the
related Assignment Agreement.
NET INTEREST SHORTFALL: With respect to any Distribution Date, the
Interest Shortfall, if any, for such Distribution Date net of Compensating
Interest Payments made with respect to such Distribution Date.
NET LIQUIDATION PROCEEDS: As to any Liquidated Mortgage Loan,
Liquidation Proceeds net of (i) Liquidation Expenses which are payable therefrom
to the related Servicer or the Master Servicer in accordance with the related
Servicing Agreement or this Agreement and (ii) unreimbursed advances by the
related Servicer or the Master Servicer and Monthly Advances.
NET MORTGAGE RATE: With respect to each Mortgage Loan, the Mortgage
Interest Rate in effect from time to time less the Servicing Fee (expressed as a
per annum rate).
NON-OFFERED CERTIFICATES: Group I Non-Offered Certificates and Group II
Non-Offered Certificates.
NON-PO PERCENTAGE: With respect to any Mortgage Loan with a Net
Mortgage Rate less than 4.7500% per annum, a fraction, expressed as a
percentage, (x) the numerator of which is equal to the related Net Mortgage
Rate, and (y) the denominator of which is equal to 4.7500% per annum. With
respect to all other loans, 100%.
NONRECOVERABLE ADVANCE: With respect to any Mortgage Loan, any advance
or Monthly Advance (i) which was previously made or is proposed to be made by
the Master Servicer, the Trustee (as successor Master Servicer) or the
applicable Servicer and (ii) which, in the good faith judgment of the Master
Servicer, the Trustee or the applicable Servicer, will not or, in the case of a
proposed advance or Monthly Advance, would not, be ultimately recoverable by the
Master Servicer, the Trustee (as successor Master Servicer) or the applicable
Servicer from Liquidation Proceeds, Insurance Proceeds or future payments on the
Mortgage Loan for which such advance or Monthly Advance was made or is proposed
to be made.
NOTIONAL AMOUNT: The Notional Amount of the Class I-X Certificates, as
of any date of determination, is equal to the aggregate Scheduled Principal
Balance of the Group I Mortgage Loans with a Net Mortgage Rate greater than
5.2500% per annum. For federal income tax purposes, however, the Notional Amount
of the Class I-X Certificates is an amount equal to the Uncertificated Notional
Amount of REMIC I Regular Interest X. The Notional Amount of the Class II-X
Certificates, as of any date of determination, is equal to the aggregate
Scheduled Principal Balance of the Group II Mortgage Loans. For federal income
tax purposes, however, the Notional Amount of the Class II-X Certificates is an
amount equal to the Uncertificated Notional Amount of REMIC II Regular Interest
II-X. The Notional Amount of the Class II-XB Certificates, as of any date of
determination, is equal to the aggregate Current Principal Amount of the Class
II-B-1, Class II-B-2 and Class II-B-3 Certificates. For federal income tax
purposes, however, the Notional Amount of the Class II-XB Certificates is the
aggregate Uncertificated Principal Balance of REMIC II Regular Interest II-B-1,
REMIC II Regular Interest II-B-2 and REMIC II Regular Interest II-B-3.
OFFICER'S CERTIFICATE: A certificate signed by the Chairman of the
Board, the Vice Chairman of the Board, the President or a Vice President or
Assistant Vice President or other authorized officer of the Master Servicer or
the Depositor, as applicable, and delivered to the Trustee, as required by this
Agreement.
OPINION OF COUNSEL: A written opinion of counsel who is or are
acceptable to the Trustee or the Master Servicer, as applicable, and who, unless
required to be Independent (an "Opinion of Independent Counsel"), may be
internal counsel for the Company, the Master Servicer or the Depositor.
ORIGINAL SUBORDINATE PRINCIPAL BALANCE: The Group I Original
Subordinate Principal Balance or Group II Original Subordinate Principal
Balance.
ORIGINAL VALUE: The lesser of (i) the Appraised Value or (ii) the sales
price of a Mortgaged Property at the time of origination of a Mortgage Loan,
except in instances where either clauses (i) or (ii) is unavailable, the other
may be used to determine the Original Value, or if both clauses (i) and (ii) are
unavailable, Original Value may be determined from other sources reasonably
acceptable to the Depositor.
OUTSTANDING MORTGAGE LOAN: With respect to any Due Date, a Mortgage
Loan which, prior to such Due Date, was not the subject of a Principal
Prepayment in full, did not become a Liquidated Mortgage Loan and was not
purchased or replaced.
OUTSTANDING PRINCIPAL BALANCE: As of the time of any determination, the
principal balance of a Mortgage Loan remaining to be paid by the Mortgagor, or,
in the case of an REO Property, the principal balance of the related Mortgage
Loan remaining to be paid by the Mortgagor at the time such property was
acquired by the Trust Fund less any Net Liquidation Proceeds with respect
thereto to the extent applied to principal.
PASS-THROUGH RATE: As to each Class of Certificates, the REMIC I
Regular Interests and the REMIC II Regular Interests, the rate of interest
determined as provided with respect thereto in Section 5.01(c). Any monthly
calculation of interest at a stated rate shall be based upon annual interest at
such rate divided by twelve.
PAYING AGENT: The Securities Administrator or any successor paying
agent appointed hereunder.
PERMITTED INVESTMENTS: Any one or more of the following obligations or
securities held in the name of the Trustee for the benefit of the related
Certificateholders:
(i) direct obligations of, and obligations the timely payment
of which are fully guaranteed by the United States of America or any agency or
instrumentality of the United States of America the obligations of which are
backed by the full faith and credit of the United States of America;
(ii) (a) demand or time deposits, federal funds or bankers'
acceptances issued by any depository institution or trust company incorporated
under the laws of the United States of America or any state thereof (including
the Trustee, the Securities Administrator or the Master Servicer or its
Affiliates acting in its commercial banking capacity) and subject to supervision
and examination by federal and/or state banking authorities, provided that the
commercial paper and/or the short-term debt rating and/or the long-term
unsecured debt obligations of such depository institution or trust company at
the time of such investment or contractual commitment providing for such
investment have the Applicable Credit Rating or better from each Rating Agency
and (b) any other demand or time deposit or certificate of deposit that is fully
insured by the Federal Deposit Insurance Corporation;
(iii) repurchase obligations with respect to (a) any security
described in clause (i) above or (b) any other security issued or guaranteed by
an agency or instrumentality of the United States of America, the obligations of
which are backed by the full faith and credit of the United States of America,
in either case entered into with a depository institution or trust company
(acting as principal) described in clause (ii)(a) above where the Trustee holds
the security therefor;
(iv) securities bearing interest or sold at a discount issued
by any corporation (including the Trustee, the Securities Administrator or the
Master Servicer or its Affiliates) incorporated under the laws of the United
States of America or any state thereof that have the Applicable Credit Rating or
better from each Rating Agency at the time of such investment or contractual
commitment providing for such investment; provided, however, that securities
issued by any particular corporation will not be Permitted Investments to the
extent that investments therein will cause the then outstanding principal amount
of securities issued by such corporation and held as part of the Trust to exceed
10% of the aggregate Outstanding Principal Balances of all the Mortgage Loans
and Permitted Investments held as part of the Trust;
(v) commercial paper (including both non-interest-bearing
discount obligations and interest-bearing obligations payable on demand or on a
specified date not more than one year after the date of issuance thereof) having
the Applicable Credit Rating or better from each Rating Agency at the time of
such investment;
(vi) a Reinvestment Agreement issued by any bank, insurance
company or other corporation or entity;
(vii) any other demand, money market or time deposit,
obligation, security or investment as may be acceptable to each Rating Agency as
evidenced in writing by each Rating Agency to the Trustee; and
(viii) any money market or common trust fund having the
Applicable Credit Rating or better from each Rating Agency, including any such
fund for which the Trustee, the Securities Administrator or Master Servicer or
any affiliate of the Trustee, the Securities Administrator or Master Servicer
acts as a manager or an advisor; provided, however, that no instrument or
security shall be a Permitted Investment if such instrument or security
evidences a right to receive only interest payments with respect to the
obligations underlying such instrument or if such security provides for payment
of both principal and interest with a yield to maturity in excess of 120% of the
yield to maturity at par or if such instrument or security is purchased at a
price greater than par.
PERMITTED TRANSFEREE: Any Person other than a Disqualified Organization
or an "electing large partnership" (as defined by Section 775 of the Code).
PERSON: Any individual, corporation, partnership, joint venture,
association, limited liability company, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
PHH MORTGAGE: PHH Mortgage Corporation, or its successor in interest.
PHH MORTGAGE SERVICING AGREEMENT: The Mortgage Loan Flow Purchase, Sale
and Servicing Agreement, dated as of April 26, 2001, among the Seller, PHH
Mortgage and Xxxxxx'x Gate Residential Mortgage Trust, attached hereto as
Exhibit H-9, and as modified by the related Assignment Agreement.
PHYSICAL CERTIFICATES: The Residual Certificates and the Non-Offered
Certificates.
PO PERCENTAGE: With respect to any Discount Mortgage Loan, a fraction
expressed as a percentage, (x) the numerator of which is equal to 4.7500% minus
the related Net Mortgage Rate, and (y) the denominator of which is equal to
4.7500% per annum.
PREPAYMENT CHARGE: With respect to any Mortgage Loan, the charges or
premiums, if any, due in connection with a full or partial prepayment of such
Mortgage Loan in accordance with the terms thereof.
PREPAYMENT INTEREST SHORTFALL: With respect to any Distribution Date,
the aggregate shortfall, if any, in collections of interest (adjusted to the
related Net Mortgage Rates) on Mortgage Loans resulting from (a) prepayments in
full received during the related Prepayment Period and (b) the partial
prepayments received during the related Prepayment Period to the extent applied
prior to the Due Date in the month of the Distribution Date.
PREPAYMENT PERIOD: With respect to any Distribution Date and the
related Servicer, such period as is provided in the related Servicing Agreement.
PRIMARY MORTGAGE INSURANCE POLICY: Any primary mortgage guaranty
insurance policy issued in connection with a Mortgage Loan which provides
compensation to a Mortgage Note holder in the event of default by the obligor
under such Mortgage Note or the related Security Instrument, if any or any
replacement policy therefor through the related Interest Accrual Period for such
Class relating to a Distribution Date.
PRINCIPAL PREPAYMENT: Any payment (whether partial or full) or other
recovery of principal on a Mortgage Loan which is received in advance of its
scheduled Due Date to the extent that it is not accompanied by an amount as to
interest representing scheduled interest due on any date or dates in any month
or months subsequent to the month of prepayment, including Insurance Proceeds
and Repurchase Proceeds, but excluding the principal portion of Net Liquidation
Proceeds received at the time a Mortgage Loan becomes a Liquidated Mortgage
Loan.
PROTECTED ACCOUNT: An account established and maintained for the
benefit of Holders of the Certificates by each Servicer with respect to the
related Mortgage Loans and with respect to REO Property pursuant to the
applicable Servicing Agreement.
QIB: A Qualified Institutional Buyer as defined in Rule 144A
promulgated under the Securities Act.
QUALIFIED INSURER: Any insurance company duly qualified as such under
the laws of the state or states in which the related Mortgaged Property or
Mortgaged Properties is or are located, duly authorized and licensed in such
state or states to transact the type of insurance business in which it is
engaged and approved as an insurer by the Master Servicer, so long as the claims
paying ability of which is acceptable to the Rating Agencies for pass-through
certificates having the same rating as the related Certificates rated by the
Rating Agencies as of the Closing Date.
RATING AGENCIES: With respect to the Group I Certificates, Fitch and
Xxxxx'x and with respect to the Group II Certificates, S&P and Xxxxx'x.
REALIZED LOSS: Any (i) Bankruptcy Loss or (ii) as to any Liquidated
Mortgage Loan, (x) the Outstanding Principal Balance of such Liquidated Mortgage
Loan plus accrued and unpaid interest thereon at the Mortgage Interest Rate
through the last day of the month of such liquidation, less (y) the related Net
Liquidation Proceeds with respect to such Mortgage Loan and the related Mortgage
Property. In addition, to the extent the Paying Agent receives Subsequent
Recoveries with respect to any Mortgage Loan, the amount of the Realized Loss
with respect to that Mortgage Loan will be reduced to the extent such recoveries
are applied to reduce the Current Principal Amount of any Class of Certificates
on any Distribution Date.
RECORD DATE: With respect to any Distribution Date and any Class of
Certificates, the close of business on the last Business Day of the month
immediately preceding the month of such Distribution Date.
REGULATION S: Regulation S promulgated under the Securities Act.
REGULATION S GLOBAL CERTIFICATES: The Regulation S Temporary Global
Certificates and the Regulation S Permanent Global Certificates.
REGULATION S PERMANENT GLOBAL CERTIFICATES: As defined in Section 5.09
(b) hereof.
REGULATION S TEMPORARY GLOBAL CERTIFICATES: As defined in Section
5.09(c) hereof.
RELIEF ACT: The Servicemembers Civil Relief Act, formerly known as the
Soldiers' and Sailors' Civil Relief Act of 1940, as amended, or similar state
law.
RELIEF ACT MORTGAGE LOAN: Any Mortgage Loan as to which the Scheduled
Payment thereof has been reduced due to the application of the Relief Act.
REMIC: A real estate mortgage investment conduit, as defined in the
Code.
REMIC I: That group of assets contained in the Trust Fund designated as
a REMIC consisting of (i) the Group I Mortgage Loans, (ii) the portion of the
Master Servicer Collection Account relating to the Group I Mortgage Loans, (iii)
any REO Property relating to the Group I Mortgage Loans, (iv) the rights with
respect to the related Servicing Agreement, (v) the rights with respect to any
related Assignment Agreement and (vi) any proceeds of the foregoing.
REMIC I INTERESTS: The REMIC I Regular Interests and the Class I-R-1
Certificates.
REMIC I REGULAR INTERESTS: REMIC I Regular Interests 1-Sub, 2-Sub,
3-Sub, PO, 1-ZZZ, 2-ZZZ, 3-ZZZ and X.
REMIC I SUBORDINATED BALANCE RATIO: The ratio among the Uncertificated
Principal Balances of each of the REMIC I Regular Interests ending with the
designation "Sub," equal to the ratio among, with respect to each such REMIC I
Regular Interest, the excess of (x) the aggregate Scheduled Principal Balance of
the Group I Mortgage Loans in the related Subgroup (other than the PO Percentage
of the Scheduled Principal Balance of any such Group I Mortgage Loans) over (y)
the aggregate Current Principal Amount of the Group I Senior Certificates (other
than the Class I-PO Certificates) in the related Subgroup.
REMIC II: That group of assets contained in the Trust Fund designated
as a REMIC consisting of (i) the Group II Mortgage Loans, (ii) the portion of
the Master Servicer Collection Account relating to the Group II Mortgage Loans,
(iii) any REO Property relating to the Mortgage Loans, (iv) the rights with
respect to the related Servicing Agreement, (v) the rights with respect to any
related Assignment Agreement and (vi) any proceeds of the foregoing.
REMIC II INTERESTS: The REMIC II Regular Interests and the Class II-R-1
Certificates.
REMIC II REGULAR INTERESTS: REMIC II Regular Interests II-A-1, II-X,
XX-X-0, XX-X-0, XX-X-0, XX-X-0, XX-X-0 and II-B-6.
REMIC III: That group of assets contained in the Trust Fund designated
as a REMIC consisting of the REMIC I Regular Interests and the REMIC II Regular
Interests.
REMIC III INTERESTS: The REMIC III Regular Certificates and the Class
I-R-2 Certificates.
REMIC III REGULAR CERTIFICATES: Each Class of Certificates other than
the Class R Certificates.
REMIC OPINION: An Opinion of Independent Counsel to the effect that the
proposed action described therein would not, under the REMIC Provisions, (i)
cause any REMIC to fail to qualify as a REMIC while any regular interest in such
REMIC is outstanding, (ii) result in a tax on prohibited transactions with
respect to any REMIC or (iii) constitute a taxable contribution to any REMIC
after the Startup Day.
REMIC PROVISIONS: The provisions of the federal income tax law relating
to REMICs, which appear at Sections 860A through 860G of the Code, and related
provisions and regulations promulgated thereunder, as the foregoing may be in
effect from time to time.
REO PROPERTY: A Mortgaged Property acquired in the name of the Trustee,
for the benefit of Certificateholders, by foreclosure or deed-in-lieu of
foreclosure in connection with a defaulted Mortgage Loan.
REPURCHASE PRICE: With respect to any Mortgage Loan (or any property
acquired with respect thereto) required to be repurchased by the Seller pursuant
to the Mortgage Loan Purchase Agreement or Article II of this Agreement, an
amount equal to the sum of (i)(a) 100% of the Outstanding Principal Balance of
such Mortgage Loan as of the date of repurchase (or if the related Mortgaged
Property was acquired with respect thereto, 100% of the Outstanding Principal
Balance at the date of the acquisition), plus (b) accrued but unpaid interest on
the Outstanding Principal Balance at the related Mortgage Interest Rate, through
and including the last day of the month of repurchase, plus (c) any unreimbursed
Monthly Advances and servicing advances payable to the Servicer of the Mortgage
Loan or to the Master Servicer and (ii) any costs and damages (if any) incurred
by the Trust in connection with any violation of such Mortgage Loan of any
predatory lending laws.
REPURCHASE PROCEEDS: The Repurchase Price in connection with any
repurchase of a Mortgage Loan by the Seller and any cash deposit in connection
with the substitution of a Mortgage Loan.
REQUEST FOR RELEASE: A request for release in the form attached hereto
as Exhibit D.
REQUIRED INSURANCE POLICY: With respect to any Mortgage Loan, any
insurance policy which is required to be maintained from time to time under this
Agreement with respect to such Mortgage Loan.
RESIDUAL CERTIFICATES: Any of the Class I-R-1, Class I-R-2 and Class
II-R-1 Certificates.
RESPONSIBLE OFFICER: Any officer assigned to the Corporate Trust Office
(or any successor thereto), including any Vice President, Assistant Vice
President, Trust Officer, any Assistant Secretary, any trust officer or any
other officer of the Trustee customarily performing functions similar to those
performed by any of the above designated officers and having direct
responsibility for the administration of this Agreement, and any other officer
of the Trustee to whom a matter arising hereunder may be referred.
RULE 144A CERTIFICATE: The certificate to be furnished by each
purchaser of a Non-Offered Certificate (which is also a Physical Certificate)
which is a Qualified Institutional Buyer as defined under Rule 144A promulgated
under the Securities Act, substantially in the form set forth as Exhibit F-2
hereto.
S&P: Standard & Poor's, a division of The XxXxxx-Xxxx Companies, Inc.,
and its successors in interest.
SCHEDULED PAYMENT: With respect to any Mortgage Loan and any month, the
scheduled payment or payments of principal and interest due during such month on
such Mortgage Loan which either is payable by a Mortgagor in such month under
the related Mortgage Note or, in the case of REO Property, would otherwise have
been payable under the related Mortgage Note.
SCHEDULED PRINCIPAL: The principal portion of any Scheduled Payment.
SCHEDULED PRINCIPAL BALANCE: With respect to any Mortgage Loan on any
Distribution Date, (i) the unpaid principal balance of such Mortgage Loan as of
the close of business on the related Due Date (i.e., taking account of the
principal payment to be made on such Due Date and irrespective of any
delinquency in its payment), as specified in the amortization schedule at the
time relating thereto (before any adjustment to such amortization schedule by
reason of any bankruptcy or similar proceeding occurring after the Cut-off Date
(other than a Deficient Valuation) or any moratorium or similar waiver or grace
period) and less (ii) any Principal Prepayments (including the principal portion
of Net Liquidation Proceeds) received during or prior to the related Prepayment
Period; provided that the Scheduled Principal Balance of a Liquidated Mortgage
Loan is zero.
SECURITIES ACT: The Securities Act of 1933, as amended.
SECURITIES ADMINISTRATOR: Xxxxx Fargo Bank, N.A., or its successor in
interest, or any successor securities administrator appointed as herein
provided.
SECURITIES LEGEND: "THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR UNDER ANY STATE SECURITIES LAWS. THE HOLDER HEREOF, BY PURCHASING THIS
CERTIFICATE, AGREES THAT THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR
OTHERWISE TRANSFERRED ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER
APPLICABLE LAWS AND ONLY (1) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT
("RULE 144A") TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A (A "QIB"), PURCHASING FOR
ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER
HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER
IS BEING MADE IN RELIANCE ON RULE 144A, (2) PURSUANT TO AN EXEMPTION FROM
REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE) OR (3)
IN CERTIFICATED FORM TO AN "INSTITUTIONAL ACCREDITED INVESTOR" WITHIN THE
MEANING THEREOF IN RULE 501(a)(1), (2), (3) or (7) OF REGULATION D UNDER THE ACT
OR ANY ENTITY IN WHICH ALL OF THE EQUITY OWNERS COME WITHIN SUCH PARAGRAPHS
PURCHASING NOT FOR DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, SUBJECT TO
(A) THE RECEIPT BY THE TRUSTEE AND THE CERTIFICATE REGISTRAR OF A LETTER
SUBSTANTIALLY IN THE FORM PROVIDED IN THE AGREEMENT AND (B) THE RECEIPT BY THE
TRUSTEE AND THE CERTIFICATE REGISTRAR OF SUCH OTHER EVIDENCE ACCEPTABLE TO THE
TRUSTEE AND THE CERTIFICATE REGISTRAR THAT SUCH REOFFER, RESALE, PLEDGE OR
TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS OR
IN EACH CASE IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED
STATES AND ANY OTHER APPLICABLE JURISDICTION. THIS CERTIFICATE MAY NOT BE
ACQUIRED DIRECTLY OR INDIRECTLY BY, OR ON BEHALF OF, AN EMPLOYEE BENEFIT PLAN OR
OTHER RETIREMENT ARRANGEMENT WHICH IS SUBJECT TO TITLE I OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED, OR SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED [in the case of a Residual Certificate
or a Class I-B-4, Class I-B-5, Class I-B-6, Class II-B-4, Class II-B-5 and Class
II-B-6 Certificate] UNLESS THE OPINION OF COUNSEL REQUIRED BY SECTION 5.07 OF
THE POOLING AND SERVICING AGREEMENT IS PROVIDED [in the case of the Class I-B-4,
Class I-B-5, Class I-B-6, Class II-B-4, Class II-B-5 and Class II-B-6
Certificate] UNLESS THE TRANSFEREE CERTIFIES OR REPRESENTS THAT THE PROPOSED
TRANSFER AND HOLDING OF A CERTIFICATE AND THE SERVICING, MANAGEMENT AND
OPERATION OF THE TRUST AND ITS ASSETS: (I) WILL NOT RESULT IN ANY PROHIBITED
TRANSACTION WHICH IS NOT COVERED UNDER AN INDIVIDUAL OR CLASS PROHIBITED
TRANSACTION EXEMPTION, INCLUDING, BUT NOT LIMITED TO, PROHIBITED TRANSACTION
EXEMPTION ("PTE") 84-14, XXX 00-00, XXX 00-0, XXX 95-60 OR PTE 96-23 AND (II)
WILL NOT GIVE RISE TO ANY ADDITIONAL FIDUCIARY DUTIES ON THE PART OF THE
DEPOSITOR, THE SECURITIES ADMINISTRATOR, THE MASTER SERVICER, ANY SERVICER OR
THE TRUSTEE, WHICH WILL BE DEEMED REPRESENTED BY AN OWNER OF A BOOK-ENTRY
CERTIFICATE OR A GLOBAL CERTIFICATE AND WILL BE EVIDENCED BY A REPRESENTATION OR
AN OPINION OF COUNSEL TO SUCH EFFECT BY OR ON BEHALF OF AN INSTITUTIONAL
ACCREDITED INVESTOR."
SECURITY AGREEMENT: With respect to a Cooperative Loan, the agreement
creating a security interest in favor of the originator in the related
Cooperative Stock.
SECURITY INSTRUMENT: A written instrument creating a valid first lien
on a Mortgaged Property securing a Mortgage Note, which may be any applicable
form of mortgage, deed of trust, deed to secure debt or security deed, including
any riders or addenda thereto.
SELLER: EMC Mortgage Corporation, as mortgage loan seller under the
Mortgage Loan Purchase Agreement.
SENIOR CERTIFICATES: The Group I Senior Certificates and Group II
Senior Certificates.
SERVICER: With respect to each Mortgage Loan, CitiMortgage, EMC,
EverHome, Fifth Third, GMAC, GreenPoint, National City, Navy Federal, PHH
Mortgage, SunTrust, WAMU and Xxxxx Fargo.
SERVICER REMITTANCE DATE: With respect to each Mortgage Loan, the date
set forth in the Servicing Agreement.
SERVICING AGREEMENTS: The CitiMortgage Servicing Agreement, EMC
Servicing Agreement, EverHome Servicing Agreement, Fifth Third Servicing
Agreement, GMAC Servicing Agreement, GreenPoint Servicing Agreement, National
City Servicing Agreement, Navy Federal Servicing Agreement, PHH Mortgage
Servicing Agreement, SunTrust Servicing Agreement, WAMU Servicing Agreement and
Xxxxx Fargo Servicing Agreement.
SERVICING FEE: As to any Mortgage Loan and Distribution Date, an amount
equal to the product of (i) the Scheduled Principal Balance of such Mortgage
Loan as of the Due Date in the preceding calendar month and (ii) the applicable
Servicing Fee Rate.
SERVICING FEE RATE: As to any Mortgage Loan, a per annum rate as set
forth in the Mortgage Loan Schedule.
SERVICING OFFICER: Any officer of the related Servicer or Master
Servicer involved in or responsible for the administration and servicing or
master servicing, as applicable, of the Mortgage Loans as to which officer
evidence, reasonably acceptable to the Trustee, of due authorization of such
officer, by such Servicer or Master Servicer has been furnished from time to
time to the Trustee.
SPECIAL HAZARD LOSS: With respect to any Mortgage Loan, a Realized Loss
attributable to damage or a direct physical loss suffered by a Mortgaged
Property (including any Realized Loss due to the presence or suspected presence
of hazardous wastes or substances on a Mortgaged Property) other than any such
damage or loss covered by a hazard policy or a flood insurance policy required
to be maintained in respect of such Mortgaged Property under this Agreement or
any loss due to normal wear and tear or certain other causes.
SPECIAL HAZARD LOSS AMOUNT: Group I Special Hazard Loss Amount or Group
II Special Hazard Loss Amount.
SPECIAL HAZARD TERMINATION DATE: Group I Special Hazard Termination
Date or Group II Special Hazard Termination Date.
STARTUP DAY: June 30, 2005.
SUBGROUP: Any of Subgroup I-1, Subgroup I-2 and Subgroup I-3.
SUBGROUP I-1: All of the Group I Mortgage Loans with a Net Mortgage
Rate of less than or equal to 4.7500% per annum plus the Subgroup I-1 Fraction
of the principal balance of any Group I Mortgage Loan with a Net Mortgage Rate
of greater than 4.7500% per annum and less than 5.0000% per annum.
SUBGROUP I-1 CERTIFICATES: The Class I-A-1, Class I-R-1, Class I-R-2
and Class I-PO Certificates.
SUBGROUP I-1 FRACTION: With respect to any Group I Mortgage Loan with a
Net Mortgage Rate of greater than 4.7500% per annum and less than 5.0000% per
annum, a fraction, (x) the numerator of which is equal to 5.0000% minus the Net
Mortgage Rate of such Group I Mortgage Loan, and (y) the denominator of which is
equal to 0.2500%.
SUBGROUP I-2: All of the Group I Mortgage Loans with a Net Mortgage
Rate of 5.0000% per annum plus the Subgroup I-2A Fraction of the principal
balance of any Group I Mortgage Loan with a Net Mortgage Rate of greater than
4.7500% per annum and less than 5.0000% per annum and the Subgroup I-2B Fraction
of the principal balance of any Group I Mortgage Loan with a Net Mortgage Rate
greater than 5.0000% per annum and less than 5.2500% per annum.
SUBGROUP I-2 CERTIFICATES: The Class I-A-2 Certificates.
SUBGROUP I-2A FRACTION: With respect to any Group I Mortgage Loan with
a Net Mortgage Rate of greater than 4.7500% per annum and less than 5.0000% per
annum, a fraction, (x) the numerator of which is equal to Net Mortgage Rate
minus 4.7500% of such Group I Mortgage Loan, and (y) the denominator of which is
equal to 0.250%.
SUBGROUP I-2B FRACTION: With respect to any Group I Mortgage Loan with
a Net Mortgage Rate of greater than 5.0000% per annum and less than 5.2500% per
annum, a fraction, (x) the numerator of which is equal to 5.2500% minus the Net
Mortgage Rate of such Group I Mortgage Loan, and (y) the denominator of which is
equal to 0.250%.
SUBGROUP I-3: All of the Group I Mortgage Loans with a Net Mortgage
Rate of greater than or equal to 5.2500% per annum.
SUBGROUP I-3 CERTIFICATES: The Class I-A-3 Certificates.
SUBGROUP I-3 FRACTION: With respect to any Group I Mortgage Loan with a
Net Mortgage Rate of greater than 5.0000% per annum and less than 5.2500% per
annum, a fraction, (x) the numerator of which is equal to the Net Mortgage Rate
of such Group I Mortgage Loans minus 5.0000%, and (y) the denominator of which
is equal to 0.2500%.
SUBGROUP PRINCIPAL DISTRIBUTION AMOUNT: With respect to each of
Subgroup I-1, Subgroup I-2 and Subgroup I-3 Certificates and each Distribution
Date will be an amount equal to the sum of the following (but in no event
greater than the aggregate Current Principal Amounts of each of the Subgroup
I-1, Subgroup I-2 and Subgroup I-3 Certificates, as applicable, immediately
prior to such Distribution Date):
(1) the applicable Subgroup Senior Percentage of the Non-PO
Percentage of the principal portion of all Scheduled Payments due on
the Group I Mortgage Loans in the related Subgroup on the related Due
Date, as specified in the amortization schedule at the time applicable
thereto (after adjustment for previous Principal Prepayments but before
any adjustments to such amortization schedule by reason of any
bankruptcy or similar proceeding or any moratorium or similar waiver or
grace period);
(2) the applicable Subgroup Senior Prepayment Percentage of
the Non-PO Percentage of the Scheduled Principal Balance of each Group
I Mortgage Loan in the related Subgroup which was the subject of a
Principal Prepayment in full received by the Master Servicer during the
applicable Prepayment Period;
(3) the applicable Subgroup Senior Prepayment Percentage of
the Non-PO Percentage of all Principal Prepayments in part received by
the Master Servicer prepayments during the applicable Prepayment Period
with respect to each Group I Mortgage Loan in the related Subgroup;
(4) the lesser of (a) the applicable Subgroup Senior
Prepayment Percentage of the Non-PO Percentage of the sum of (i) all
Net Liquidation Proceeds allocable to principal received in respect of
each Group I Mortgage Loan in the related Subgroup which became a
Liquidated Mortgage Loan during the related Prepayment Period (other
than Group I Mortgage Loans described in the immediately following
clause (ii)) and all Subsequent Recoveries received in respect of each
Liquidated Mortgage Loan in the related Subgroup during the related Due
Period and (ii) the Scheduled Principal Balance of each such Group I
Mortgage Loan in the related Subgroup purchased by an insurer from the
Trustee during the related Prepayment Period pursuant to the related
Primary Mortgage Insurance Policy, if any, or otherwise; and (b) the
applicable Subgroup Senior Percentage of the Non-PO Percentage of the
sum of (i) the Scheduled Principal Balance of each Group I Mortgage
Loan in the related Subgroup which became a Liquidated Mortgage Loan
during the related Prepayment Period (other than the Group I Mortgage
Loans described in the immediately following clause (ii)) and all
Subsequent Recoveries received in respect of each Liquidated Mortgage
Loan in the related Subgroup during the related Due Period and (ii) the
Scheduled Principal Balance of each such Group I Mortgage Loan in the
related Subgroup that was purchased by an insurer from the Trustee
during the related Prepayment Period pursuant to the related Primary
Mortgage Insurance Policy, if any or otherwise; and
(5) the applicable Subgroup Senior Prepayment Percentage of
the Non-PO Percentage of the sum of (a) the Scheduled Principal Balance
of each Group I Mortgage Loan in the related Subgroup which was
repurchased by the Issuer in connection with such Distribution Date and
(b) the excess, if any, of the Scheduled Principal Balance of each
Group I Mortgage Loan in the related Subgroup that has been replaced by
the Issuer with a substitute Group I Mortgage Loan pursuant to the
Mortgage Loan Purchase Agreement in connection with such Distribution
Date over the Scheduled Principal Balance of each such substitute Group
I Mortgage Loan.
SUBGROUP SENIOR PERCENTAGE: With respect to each Subgroup, the lesser
of (a) 100% and (b) the percentage (carried to six places rounded up) obtained
by dividing the Current Principal Amount of the Group I Senior Certificates of
such Subgroup (other than any Class I-PO Certificates), immediately prior to
such Distribution Date, by the aggregate Scheduled Principal Balance of the
Group I Mortgage Loans in the related Subgroup (other than the I-PO Percentage
thereof with respect to the related Discount Mortgage Loans) as of the beginning
of the related Due Period. The initial Subgroup Senior Percentage for the Group
I Senior Certificates will be approximately 98.39%.
SUBGROUP SENIOR PREPAYMENT PERCENTAGE: The Subgroup Senior Prepayment
Percentage for the Subgroup I-1, Subgroup I-2 and Subgroup I-3 Certificates, on
any Distribution Date occurring during the periods set forth below will be as
follows:
PERIOD (DATES INCLUSIVE) SUBGROUP SENIOR PREPAYMENT PERCENTAGE
------------------------ -------------------------------------
July 25, 2005 - June 25, 2010 100%
July 25, 2010 - June 25, 2011 Subgroup Senior Percentage for the related Subgroup
Certificates plus
70% of the related
Group I Subordinate
Percentage
July 25, 2011 - June 25, 2012 Subgroup Senior Percentage for the related Subgroup
Certificates plus 60% of the related Group I
Subordinate Percentage
July 25, 2012 - June 25, 2013 Subgroup Senior Percentage for the related Subgroup
Certificates plus 40% of the related Group I
Subordinate Percentage
July 25, 2013 - June 25, 2014 Subgroup Senior Percentage for the related Subgroup
Certificates plus 20% of the related Group I
Subordinate Percentage
July 25, 2014 and thereafter Subgroup Senior Percentage for the related Group I
Subgroup Certificates
Any scheduled reduction to the Subgroup Senior Prepayment Percentage
for the Subgroup I-1, Subgroup I-2 and Subgroup I-3 Certificates shall not be
made as of any Distribution Date unless, as of the last day of the month
preceding such Distribution Date (1) the aggregate Scheduled Principal Balance
of the Group I Mortgage Loans delinquent 60 days or more (including for this
purpose any such Group I Mortgage Loans in foreclosure and such Group I Mortgage
Loans with respect to which the related Mortgaged Property has been acquired by
the Trust) averaged over the last six months, as a percentage of the aggregate
Current Principal Amount of the Group I Subordinate Certificates does not exceed
50% and (2) cumulative Realized Losses on the Group I Mortgage Loans do not
exceed (a) 30% of the aggregate Current Principal Amount of the Group I Original
Subordinate Principal Balance if such Distribution Date occurs between and
including July 2010 and June 2011, (b) 35% of the Group I Original Subordinate
Principal Balance if such Distribution Date occurs between and including July
2011 and June 2012, (c) 40% of the Group I Original Subordinate Principal
Balance if such Distribution Date occurs between and including July 2012 and
June 2013, (d) 45% of the Group I Original Subordinate Principal Balance if such
Distribution Date occurs between and including July 2013 and June 2014, and (e)
50% of the Group I Original Subordinate Principal Balance if such Distribution
Date occurs during or after July 2014.
Notwithstanding the foregoing, if on any Distribution Date, the
percentage for Subgroup I-1, Subgroup I-2 and Subgroup I-3, the numerator of
which is the aggregate Current Principal Amount of the Group I Senior
Certificates of such Subgroup immediately preceding such Distribution Date, and
the denominator of which is the Scheduled Principal Balance of the Group I
Mortgage Loans in such Subgroup (other than the I-PO Percentage thereof with
respect to the Discount Mortgage Loans) as of the beginning of the related Due
Period, exceeds such percentage as of the Cut-off Date, then the Subgroup Senior
Prepayment Percentage with respect to the Group I Senior Certificates of each
Subgroup for such Distribution Date will equal 100%.
SUBORDINATE CERTIFICATES: The Group I Subordinate Certificates and
Group II Subordinate Certificates.
SUBORDINATE CERTIFICATE WRITEDOWN AMOUNT: Group I Subordinate
Certificate Writedown Amount or Group II Subordinate Certificate Writedown
Amount.
SUBORDINATE OPTIMAL PRINCIPAL AMOUNT: Group I Subordinate Optimal
Principal Amount or Group II Subordinate Optimal Principal Amount.
SUBORDINATE PERCENTAGE: Group I Subordinate Percentage or Group I
Subordinate Percentage.
SUBORDINATE PREPAYMENT PERCENTAGE: Group I Subordinate Prepayment
Percentage or Group II Subordinate Prepayment Percentage.
SUBSEQUENT RECOVERIES: As of any Distribution Date, amounts received by
the related Servicer during the related Due Period or surplus amounts held by
the related Servicer to cover estimated expenses (including, but not limited to,
recoveries in respect of the representations and warranties made by the Seller
pursuant to the Mortgage Loan Purchase Agreement) specifically related to a
Liquidated Mortgage Loan or disposition of an REO Property prior to the related
Prepayment Period that resulted in a Realized Loss, after the liquidation or
disposition of such Mortgage Loan.
SUBSTITUTE MORTGAGE LOAN: A mortgage loan tendered to the Trustee
pursuant to the Servicing Agreement, the Mortgage Loan Purchase Agreement or
Section 2.04 of this Agreement, as applicable, in each case, (i) which has an
Outstanding Principal Balance not greater nor materially less than the Mortgage
Loan for which it is to be substituted; (ii) which has a Mortgage Interest Rate
and Net Mortgage Rate not less than, and not materially greater than, such
Mortgage Loan; (iii) which has a maturity date not materially earlier or later
than such Mortgage Loan and not later than the latest maturity date of any
Mortgage Loan; (iv) which is of the same property type and occupancy type as
such Mortgage Loan; (v) which has a Loan-to-Value Ratio not greater than the
Loan-to-Value Ratio of such Mortgage Loan; (vi) which is current in payment of
principal and interest as of the date of substitution; and (vii) as to which the
payment terms do not vary in any material respect from the payment terms of the
Mortgage Loan for which it is to be substituted.
SUNTRUST: SunTrust Mortgage, Inc., or its successor in interest.
SUNTRUST SERVICING AGREEMENT: The Purchase, Warranties and Servicing
Agreement, dated as of January 1, 2002, between the Seller and SunTrust,
attached hereto as Exhibit H-10, and as modified by the related Assignment
Agreement.
TAX ADMINISTRATION AND TAX MATTERS PERSON: The Securities Administrator
or any successor thereto or assignee thereof shall serve as tax administrator
hereunder and as agent for the Tax Matters Person. The Holder of each Class of
Residual Certificates shall be the Tax Matters Person for the related REMIC, as
more particularly set forth in Section 9.12 hereof.
TERMINATION PURCHASE PRICE: The price, calculated as set forth in
Section 10.01, to be paid in connection with the repurchase of the Mortgage
Loans pursuant to Section 10.01.
TRUST FUND: The corpus of the trust created by this Agreement,
consisting of the Mortgage Loans and the other assets described in Section
2.01(a).
TRUSTEE: U.S. Bank National Association or its successor in interest,
or any successor trustee appointed as herein provided.
UNCERTIFICATED NOTIONAL AMOUNT: With respect to REMIC I Regular
Interest X, the aggregate Scheduled Principal Balance of the Group I Mortgage
Loans with Net Mortgage Rates greater than 5.2500% per annum. With respect to
REMIC II Regular Interest II-X, an amount equal to the aggregate Scheduled
Principal Balance of the Group II Mortgage Loans.
UNCERTIFICATED PRINCIPAL BALANCE: With respect to any REMIC I Regular
Interest or REMIC II Regular Interest as of any Distribution Date, the initial
principal amount of such Regular Interest, reduced by (i) all amounts
distributed on previous Distribution Dates on such regular interest with respect
to principal and (ii) the principal portion of all Realized Losses allocated
prior to such Distribution Date to such regular interest, taking account of the
Group I Loss Allocation Limit or Group II Loss Allocation Limit, as applicable.
UNINSURED CAUSE: Any cause of damage to a Mortgaged Property or related
REO Property such that the complete restoration of such Mortgaged Property or
related REO Property is not fully reimbursable by the hazard insurance policies
required to be maintained pursuant the Servicing Agreement, without regard to
whether or not such policy is maintained.
UNITED STATES PERSON: A citizen or resident of the United States, a
corporation or partnership (including an entity treated as a corporation or
partnership for federal income tax purposes) created or organized in, or under
the laws of, the United States or any state thereof or the District of Columbia
(except, in the case of a partnership, to the extent provided in Treasury
regulations), provided that, for purposes solely of the Residual Certificates,
no partnership or other entity treated as a partnership for United States
federal income tax purposes shall be treated as a United States Person unless
all Persons that own an interest in such partnership either directly or through
any entity that is not a corporation for United States federal income tax
purposes are United States Persons, or an estate whose income is subject to
United States federal income tax regardless of its source, or a trust if a court
within the United States is able to exercise primary supervision over the
administration of the trust and one or more such United States Persons have the
authority to control all substantial decisions of the trust. To the extent
prescribed in regulations by the Secretary of the Treasury, which have not yet
been issued, a trust which was in existence on August 20, 1996 (other than a
trust treated as owned by the grantor under subpart E of part I of subchapter J
of chapter 1 of the Code) and which was treated as a United States Person on
August 20, 1996 may elect to continue to be treated as a United States Person
notwithstanding the previous sentence.
WAMU: Washington Mutual Bank, or its successor in interest.
WAMU SERVICING AGREEMENT: The Servicing Agreement, dated as of April 1,
2005, between the Seller and Washington Mutual, attached hereto as Exhibit H-11,
and as modified by the related Assignment Agreement.
XXXXX FARGO: Xxxxx Fargo Bank, N.A., or its successor in interest.
XXXXX FARGO SERVICING AGREEMENT: The Master Seller's Warranties and
Servicing Agreement, dated as of October 1, 2004, between the Seller and Xxxxx
Fargo, attached hereto as Exhibit H-12, and as modified by the related
Assignment Agreement.
Section 1.02 CALCULATION OF LIBOR.
LIBOR applicable to the calculation of the Pass-Through Rate on the
Adjustable Rate Certificates for any Interest Accrual Period will be determined
on each Interest Determination Date. On each Interest Determination Date, LIBOR
shall be established by the Securities Administrator and, as to any Interest
Accrual Period, will equal the rate for one month United States dollar deposits
that appears on the Telerate Screen Page 3750 as of 11:00 a.m., London" time, on
such Interest Determination Date. "Telerate Screen Page 3750" means the display
designated as page 3750 on the Telerate Service (or such other page as may
replace page 3750 on that service for the purpose of displaying London interbank
offered rates of major banks). 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, LIBOR shall be so established by use of such other service
for displaying LIBOR or comparable rates as may be reasonably selected by the
Securities Administrator), the rate will be the Reference Bank Rate. The
"Reference Bank Rate" will be determined on the basis of the rates at which
deposits in U.S. Dollars are offered by the reference banks (which shall be any
three major banks that are engaged in transactions in the London interbank
market, selected by the Securities Administrator) as of 11:00 a.m., London time,
on the Interest Determination Date to prime banks in the London interbank market
for a period of one month in amounts approximately equal to the aggregate
Current Principal Amount of the Adjustable Rate Certificates then outstanding.
The Securities Administrator will request the principal London office of each of
the reference banks to provide a quotation of its rate. If at least two such
quotations are provided, the rate will be the arithmetic mean of the quotations
rounded up to the nearest whole multiple of 0.03125%. If on such date fewer than
two quotations are provided as requested, the rate will be the arithmetic mean
of the rates quoted by one or more major banks in New York City, selected by the
Securities Administrator, as of 11:00 a.m., New York City time, on such date for
loans in U.S. Dollars to leading European banks for a period of one month in
amounts approximately equal to the aggregate Current Principal Amount of the
Adjustable Rate Certificates then outstanding. If no such quotations can be
obtained, the rate will be LIBOR for the prior Distribution Date; PROVIDED
HOWEVER, if, under the priorities described above, LIBOR for a Distribution Date
would be based on LIBOR for the previous Distribution Date for the third
consecutive Distribution Date, the Securities Administrator shall select an
alternative comparable index (over which the Securities Administrator e has no
control), used for determining one-month Eurodollar lending rates that is
calculated and published (or otherwise made available) by an independent party.
The establishment of LIBOR by the Securities Administrator on any Interest
Determination Date and the Securities Administrator's subsequent calculation of
the Pass-Through Rate applicable to the Adjustable Rate Certificates for the
relevant Interest Accrual Period, in the absence of manifest error, will be
final and binding. Promptly following each Interest Determination Date the
Securities Administrator shall supply the Master Servicer with the results of
its determination of LIBOR on such date.
ARTICLE II
Conveyance of Mortgage Loans;
Original Issuance of Certificates
Section 2.01 CONVEYANCE OF MORTGAGE LOANS TO TRUSTEE.
(a) The Depositor concurrently with the execution and delivery of this
Agreement, sells, transfers and assigns to each Trust without recourse all its
right, title and interest in and to (i) the Mortgage Loans identified in the
Mortgage Loan Schedule, including all interest and principal due with respect to
the Mortgage Loans after the Cut-off Date, but excluding any payments of
principal and interest due on or prior to the Cut-off Date; (ii) such assets as
shall from time to time be credited or are required by the terms of this
Agreement to be credited to the Master Servicer Collection Account, (iii) such
assets relating to the Mortgage Loans as from time to time may be held by the
Servicers in the Protected Accounts, the Master Servicer in the Master Servicer
Collection Account and the Paying Agent in the Distribution Account, (iv) any
REO Property, (v) the Required Insurance Policies and any amounts paid or
payable by the insurer under any Insurance Policy (to the extent the mortgagee
has a claim thereto), (vi) the Mortgage Loan Purchase Agreement to the extent
provided in Subsection 2.03(a), (vii) the rights with respect to the Servicing
Agreements as assigned to the Trustee on behalf of the related
Certificateholders by the Assignment Agreements and (viii) all proceeds of the
foregoing. Although it is the intent of the parties to this Agreement that the
conveyance of the Depositor's right, title and interest in and to the Mortgage
Loans and other assets in the Trust Funds pursuant to this Agreement shall
constitute a purchase and sale and not a loan, in the event that such conveyance
is deemed to be a loan, it is the intent of the parties to this Agreement that
the Depositor shall be deemed to have granted to the Trustee a first priority
perfected security interest in all of the Depositor's right, title and interest
in, to and under the Mortgage Loans and other assets in the Trust Fund, and that
this Agreement shall constitute a security agreement under applicable law.
Moreover, if for any other reason this Agreement is held or deemed to create a
security interest in the Mortgage Loans and the other assets constituting the
Trust Funds, then it is intended as follows: (a) this Agreement shall also be
deemed to be a security agreement within the meaning of Articles 8 and 9 of the
Uniform Commercial Code; (b) the conveyance provided for in this Section shall
be deemed to be a grant by the Depositor to the Trustee of a security interest
in all of the Depositor's right, title and interest in and to the Mortgage Loans
and all proceeds of the conversion, voluntary or involuntary, of the foregoing
into cash, instruments, securities or other property, including without
limitation all amounts from time to time held or invested in the Distribution
Account, whether in the form of cash, instruments, securities or other property;
(c) the possession by the Trustee or its agent of the Mortgage Loans and such
other items of property as constitute instruments, money, negotiable documents
or chattel paper shall be deemed to be "possession by the secured party" for
purposes of perfecting the security interest pursuant to Section 9-305 of the
Uniform Commercial Code; (d) the Securities Administrator shall be deemed to be
the "securities intermediary," as such term is defined in Section
8-102(a)(14)(ii) of the New York Uniform Commercial Code, that in the ordinary
course of its business maintains "securities accounts" for others, as such term
is used in Section 8-501 of the New York Uniform Commercial Code; (e) the
"securities intermediary's jurisdiction" as defined in the New York Uniform
Commercial Code shall be the State of New York; (f) the Securities Administrator
is not a "clearing corporation", as such term is defined in Section 8-102(a)(5)
of the New York Uniform Commercial Code and (g) notifications to persons holding
such property, and acknowledgments, receipts or confirmations from persons
holding such property, shall be deemed to be notifications to or
acknowledgments, receipts or confirmations from, financial intermediaries,
bailees or agents (as applicable) of the Trustee for the purpose of perfecting
such security interest under applicable law. The Depositor, the Seller and the
Trustee agree that it is not intended that any mortgage loan be conveyed to the
Trust that is either (i) a "High-Cost Home Loan" as defined in the New Jersey
Home Ownership Act effective November 27, 2003, (ii) a "High-Cost Home Loan" as
defined in the New Mexico Home Loan Protection Act effective January 1, 2004
(iii) a "High Cost Home Mortgage Loan" as defined in the Massachusetts Predatory
Home Loan Practices Act effective November 7, 2004 or (iv) a "High-Cost Home
Loan" as defined by the Indiana High Cost Home Loan Law effective Jan 1, 2005.
(b) In connection with the above transfer and assignment, the Depositor
hereby delivers to the Custodian, as agent for the Trustee, with respect to each
Mortgage Loan (other than a Cooperative Loan):
(i) the original Mortgage Note, endorsed without recourse (a)
to the order of the Trustee or (b) in the case of a Mortgage Loan registered on
the MERS system, endorsed in blank, in either case showing an unbroken chain of
endorsements from the originator thereof to the Person endorsing it to the
Trustee, or lost note affidavit together with a copy of the related Mortgage
Note;
(ii) the original Mortgage and, if the related Mortgage
Loan is a MOM Loan, noting the presence of the MIN and language indicating that
such Mortgage Loan is a MOM Loan, which shall have been recorded (or if the
original is not available, a copy), with evidence of such recording indicated
thereon (or if clause (w) in the proviso below applies, shall be in recordable
form);
(iii) unless the Mortgage Loan is a MOM Loan, a certified
copy of the assignment (which may be in the form of a blanket assignment if
permitted in the jurisdiction in which the Mortgaged Property is located) to
"U.S. Bank National Association, as Trustee", with evidence of recording with
respect to each Mortgage Loan in the name of the Trustee thereon (or if clause
(w) in the proviso below applies or for Mortgage Loans with respect to which the
related Mortgaged Property is located in a state other than Maryland or an
Opinion of Counsel has been provided as set forth in this Section 2.01(b), shall
be in recordable form);
(iv) all intervening assignments of the Security
Instrument, if applicable and only to the extent available to the Depositor with
evidence of recording thereon;
(v) the original or a copy of the policy or certificate of
primary mortgage guaranty insurance, to the extent available, if any;
(vi) the original policy of title insurance or mortgagee's
certificate of title insurance or commitment or binder for title insurance; and
(vii) originals of all modification agreements, if applicable
and available.
and (II) with respect to each Cooperative Loan so assigned:
(i) The original Mortgage Note, endorsed without recourse to
the order of the Trustee and showing an unbroken chain of endorsements from the
originator thereof to the Person endorsing it to the Trustee, or lost note
affidavit, together with a copy of the related Mortgage Note;
(ii) A counterpart of the Cooperative Lease and the Assignment
of Proprietary Lease to the originator of the Cooperative Loan with intervening
assignments showing an unbroken chain of title from such originator to the
Trustee;
(iii) The related Cooperative Stock Certificate, representing
the related Cooperative Stock pledged with respect to such Cooperative Loan,
together with an undated stock power (or other similar instrument) executed in
blank;
(iv) The original recognition agreement by the Cooperative of
the interests of the mortgagee with respect to the related Cooperative Loan and
any transfer documents related to the recognition agreement;
(v) The Security Agreement;
(vi) Copies of the original UCC-1 financing statement, and any
continuation statements, filed by the originator of such Cooperative Loan as
secured party, each with evidence of recording thereof, evidencing the interest
of the originator under the Security Agreement and the Assignment of Proprietary
Lease;
(vii) Copies of the filed UCC-3 assignments of the security
interest referenced in clause (vi) above showing an unbroken chain of title from
the originator to the Trustee, each with evidence of recording thereof,
evidencing the interest of the originator under the Security Agreement and the
Assignment of Proprietary Lease;
(viii) An executed assignment of the interest of the
originator in the Security Agreement and Assignment of Proprietary Lease,
showing an unbroken chain of title from the originator to the Trustee; and
(ix) The original of each modification, assumption agreement
or preferred loan agreement, if any, relating to such Cooperative Loan;
PROVIDED, HOWEVER, that in lieu of the foregoing, the Depositor may deliver to
the Custodian, as agent of the Trustee, the following documents, under the
circumstances set forth below: (w) in lieu of the original Security Instrument,
assignments to the Trustee or intervening assignments thereof which have been
delivered, are being delivered or will, upon receipt of recording information
relating to the Security Instrument required to be included thereon, be
delivered to recording offices for recording and have not been returned to the
Depositor in time to permit their delivery as specified above, the Depositor may
deliver a true copy thereof with a certification by the Depositor, on the face
of such copy, substantially as follows: "Certified to be a true and correct copy
of the original, which has been transmitted for recording"; (x) in lieu of the
Security Instrument, assignment to the Trustee or intervening assignments
thereof, if the applicable jurisdiction retains the originals of such documents
(as evidenced by a certification from the Depositor to such effect) the
Depositor may deliver photocopies of such documents containing an original
certification by the judicial or other governmental authority of the
jurisdiction where such documents were recorded; (y) in lieu of the Mortgage
Notes relating to the Mortgage Loans identified on Exhibit 5 to the Mortgage
Loan Purchase Agreement, the Depositor may deliver lost note affidavits from the
Seller; and (z) the Depositor shall not be required to deliver intervening
assignments or Mortgage Note endorsements between the related underlying
originator or underlying Seller and the Seller, between the Seller and the
Depositor, and between the Depositor and the Trustee; and provided, further,
however, that in the case of Mortgage Loans which have been prepaid in full
after the Cut-off Date and prior to the Closing Date, the Depositor, in lieu of
delivering the above documents, may deliver to the Trustee or the Custodian, as
its agent, a certification to such effect and shall deposit all amounts paid in
respect of such Mortgage Loans in the Master Servicer Collection Account on the
Closing Date. The Depositor shall deliver such original documents (including any
original documents as to which certified copies had previously been delivered)
to the Trustee or the Custodian, as its agent, promptly after they are received.
The Depositor shall cause the Seller, at its expense, to cause each assignment
of the Security Instrument to the Trustee to be recorded not later than 180 days
after the Closing Date, unless (a) such recordation is not required by the
Rating Agencies or an Opinion of Counsel addressed to the Trustee has been
provided to the Trustee (with a copy to the Custodian) which states that
recordation of such Security Instrument is not required to protect the interests
of the related Certificateholders in the related Mortgage Loans or (b) MERS is
identified on the Mortgage or on a properly recorded assignment of the Mortgage
as the mortgagee of record solely as nominee for the Seller and its successor
and assigns; provided, however, notwithstanding the foregoing, each assignment
shall be submitted for recording by the Seller in the manner described above, at
no expense to the Trust or the Trustee or the Custodian, as its agent, upon the
earliest to occur of: (i) reasonable direction by the Holders of Certificates
evidencing Fractional Undivided Interests aggregating not less than 25% of the
Trust Fund, (ii) the occurrence of an Event of Default, (iii) the occurrence of
a bankruptcy, insolvency or foreclosure relating to the Seller and (iv) the
occurrence of a servicing transfer as described in Section 8.02 hereof.
Notwithstanding the foregoing, if the Seller fails to pay the cost of recording
the assignments, such expense will be paid by the Trustee and the Trustee shall
be reimbursed for such expenses by the Trust in accordance with Section 9.05.
Section 2.02 ACCEPTANCE OF MORTGAGE LOANS AND UNDERLYING CERTIFICATES
BY TRUSTEE.
(a) The Trustee acknowledges the sale, transfer and assignment of the
Trust Funds to it by the Depositor and receipt of, subject to further review and
the exceptions which may be noted pursuant to the procedures described below,
and declares that it holds, the documents (or certified copies thereof)
delivered to the Custodian, as its agent, pursuant to Section 2.01(b), and
declares that it will continue to hold those documents and any amendments,
replacements or supplements thereto and all other assets of the Trust Funds
delivered to it as Trustee in trust for the use and benefit of all present and
future Holders of the related Certificates. On the Closing Date, the Custodian,
with respect to the Mortgage Loans, shall acknowledge with respect to each
Mortgage Loan by delivery to the Depositor and the Trustee of an Initial
Certification receipt of the Mortgage File, but without review of such Mortgage
File, except to the extent necessary to confirm that such Mortgage File contains
the related Mortgage Note or lost note affidavit. No later than 90 days after
the Closing Date (or, with respect to any Substitute Mortgage Loan, within five
Business Days after the receipt by the Trustee or Custodian thereof), the
Trustee agrees, for the benefit of the related Certificateholders, to review or
cause to be reviewed by the Custodian on its behalf (under the Custodial
Agreement), each Mortgage File delivered to it and to execute and deliver, or
cause to be executed and delivered, to the Depositor and the Trustee an Interim
Certification. In conducting such review, the Trustee or Custodian will
ascertain whether all required documents have been executed and received, and
based on the Mortgage Loan Schedule, whether those documents relate, determined
on the basis of the Mortgagor name, original principal balance and loan number,
to the Mortgage Loans it has received, as identified in the Mortgage Loan
Schedule. In performing any such review, the Trustee or the Custodian, as its
agent, may conclusively rely on the purported due execution and genuineness of
any such document and on the purported genuineness of any signature thereon. If
the Trustee or the Custodian, as its agent, finds any document constituting part
of the Mortgage File has not been executed or received, or to be unrelated,
determined on the basis of the Mortgagor name, original principal balance and
loan number, to the Mortgage Loans identified in Exhibit B or to appear
defective on its face (a "Material Defect"), the Trustee or the Custodian, as
its agent, shall promptly notify the Seller. In accordance with the Mortgage
Loan Purchase Agreement, the Seller shall correct or cure any such defect within
ninety (90) days from the date of notice from the Trustee or the Custodian, as
its agent, of the defect and if the Seller fails to correct or cure the defect
within such period, and such defect materially and adversely affects the
interests of the related Certificateholders in the related Mortgage Loan, the
Trustee shall enforce the Seller's obligation under the Mortgage Loan Purchase
Agreement to, within 90 days from the Trustee's or the Custodian's notification,
provide a Substitute Mortgage Loan (if within two years of the Closing Date) or
purchase such Mortgage Loan at the Repurchase Price; provided that, if such
defect would cause the Mortgage Loan to be other than a "qualified mortgage" as
defined in Section 860G(a)(3) of the Code, any such cure or repurchase must
occur within 90 days from the date such breach was discovered; provided,
however, that if such defect relates solely to the inability of the Seller to
deliver the original Security Instrument or intervening assignments thereof, or
a certified copy because the originals of such documents, or a certified copy
have not been returned by the applicable jurisdiction, the Seller shall not be
required to purchase such Mortgage Loan if the Seller delivers such original
documents or certified copy promptly upon receipt, but in no event later than
360 days after the Closing Date. The foregoing repurchase obligation shall not
apply in the event that the Seller cannot deliver such original or copy of any
document submitted for recording to the appropriate recording office in the
applicable jurisdiction because such document has not been returned by such
office; provided that the Seller shall instead deliver a recording receipt of
such recording office or, if such receipt is not available, a certificate
confirming that such documents have been accepted for recording, and delivery to
the Trustee or the Custodian, as its agent, shall be effected by the Seller
within thirty days of its receipt of the original recorded document.
(b) No later than 180 days after the Closing Date, the Trustee or the
Custodian, as its agent, will review, for the benefit of the Certificateholders,
the Mortgage Files delivered to it and will execute and deliver or cause to be
executed and delivered to the Depositor and the Trustee a Final Certification.
In conducting such review, the Trustee or the Custodian, as its agent, will
ascertain whether an original of each document required to be recorded has been
returned from the recording office with evidence of recording thereon or a
certified copy has been obtained from the recording office. If the Trustee or
the Custodian, as its agent, finds a Material Defect, the Trustee or the
Custodian, as its agent, shall promptly notify the Seller (provided, however,
that with respect to those documents described in subsections (b)(I)(iv), (v),
and (vii) of Section 2.01 and subsection (b)(II)(ix) of Section 2.01, the
Trustee's and Custodian's obligations shall extend only to the documents
actually delivered to the Custodian pursuant to such subsections). In accordance
with the Mortgage Loan Purchase Agreement, the Seller shall correct or cure any
such defect within 90 days from the date of notice from the Trustee or the
Custodian, as its agent, of the Material Defect and if the Seller is unable to
cure such defect within such period, and if such defect materially and adversely
affects the interests of the related Certificateholders in the related Mortgage
Loan, the Trustee shall enforce the Seller's obligation under the Mortgage Loan
Purchase Agreement to, within 90 days from the Trustee's or Custodian's
notification, provide a Substitute Mortgage Loan (if within two years of the
Closing Date) or purchase such Mortgage Loan at the Repurchase Price, provided
that, if such defect would cause the Mortgage Loan to be other than a "qualified
mortgage" as defined in Section 860G(a)(3) of the Code, any such cure,
repurchase or substitution must occur within 90 days from the date such breach
was discovered, provided, however, that if such defect relates solely to the
inability of the Seller to deliver the original Security Instrument or
intervening assignments thereof, or a certified copy, because the originals of
such documents or a certified copy, have not been returned by the applicable
jurisdiction, the Seller shall not be required to purchase such Mortgage Loan,
if the Seller delivers such original documents or certified copy promptly upon
receipt, but in no event later than 360 days after the Closing Date. The
foregoing repurchase obligation shall not apply in the event that the Seller
cannot deliver such original or copy of any document submitted for recording to
the appropriate recording office in the applicable jurisdiction because such
document has not been returned by such office; provided that the Seller shall
instead deliver a recording receipt of such recording office or, if such receipt
is not available, a certificate confirming that such documents have been
accepted for recording, and delivery to the Trustee or the Custodian, as its
agent, shall be effected by the Seller within thirty days of its receipt of the
original recorded document.
(c) In the event that a Mortgage Loan is purchased by the Seller in
accordance with Subsections 2.02(a) or (b) above, the Seller shall remit to the
Master Servicer the Repurchase Price for deposit in the Master Servicer
Collection Account and the Seller shall provide to the Securities Administrator
and the Trustee written notification detailing the components of the Repurchase
Price. Upon deposit of the Repurchase Price in the Master Servicer Collection
Account, the Depositor shall notify the Trustee and the Custodian, as agent of
the Trustee (upon receipt of a Request for Release in the form of Exhibit D
attached hereto with respect to such Mortgage Loan), shall release to the Seller
the related Mortgage File and the Trustee shall execute and deliver all
instruments of transfer or assignment, without recourse, representation or
warranty, furnished to it by the Seller, as are necessary to vest in the Seller
title to and rights under the Mortgage Loan. Such purchase shall be deemed to
have occurred on the date on which the Repurchase Price in immediately available
funds is received by the Paying Agent. The Master Servicer shall amend the
Mortgage Loan Schedule, which was previously delivered to it by the Depositor in
a form agreed to between the Depositor, the Master Servicer and the Trustee, to
reflect such repurchase and shall promptly notify the Rating Agencies and the
Securities Administrator of such amendment. The obligation of the Seller to
repurchase or substitute for any Mortgage Loan a Substitute Mortgage Loan as to
which such a defect in a constituent document exists shall be the sole remedy
respecting such defect available to the related Certificateholders or to the
Trustee on their behalf.
Section 2.03 ASSIGNMENT OF INTEREST IN THE MORTGAGE LOAN PURCHASE
AGREEMENT.
(a) The Depositor hereby assigns to the Trustee, on behalf of the
Certificateholders of the Certificates, all of its right, title and interest in
the Mortgage Loan Purchase Agreement, including but not limited to the
Depositor's rights and obligations pursuant to the Servicing Agreements (noting
that the Seller has retained the right in the event of breach of the
representations, warranties and covenants, if any, with respect to the related
Mortgage Loans of the related Servicer under the related Servicing Agreement to
enforce the provisions thereof and to seek all or any available remedies). The
obligations of the Seller to substitute or repurchase, as applicable, a Mortgage
Loan shall be the Trustee's and the related Certificateholders' sole remedy for
any breach thereof. At the request of the Trustee, the Depositor shall take such
actions as may be necessary to enforce the above right, title and interest on
behalf of the Trustee, the related Certificateholders of the Certificates shall
execute such further documents as the Trustee may reasonably require in order to
enable the Trustee to carry out such enforcement.
(b) If the Depositor, the Securities Administrator or the Trustee
discovers a breach of any of the representations and warranties set forth in the
Mortgage Loan Purchase Agreement, which breach materially and adversely affects
the value of the interests of related Certificateholders or the Trustee in the
related Mortgage Loan, the party discovering the breach shall give prompt
written notice of the breach to the other parties. The Seller, within 90 days of
its discovery or receipt of notice that such breach has occurred (whichever
occurs earlier), shall cure the breach in all material respects or, subject to
the Mortgage Loan Purchase Agreement or Section 2.04 of this Agreement, as
applicable, shall purchase the Mortgage Loan or any property acquired with
respect thereto from the Trustee; provided, however, that if there is a breach
of any representation set forth in the Mortgage Loan Purchase Agreement or
Section 2.04 of this Agreement, as applicable, and the Mortgage Loan or the
related property acquired with respect thereto has been sold, then the Seller
shall pay, in lieu of the Repurchase Price, any excess of the Repurchase Price
over the Net Liquidation Proceeds received upon such sale. If the Net
Liquidation Proceeds exceed the Repurchase Price, any excess shall be paid to
the Seller to the extent not required by law to be paid to the borrower. Any
such purchase by the Seller shall be made by providing an amount equal to the
Repurchase Price to the Master Servicer for deposit in the Master Servicer
Collection Account and written notification detailing the components of such
Repurchase Price to the Master Servicer. The Depositor shall notify the Trustee
and submit to the Custodian, as agent for the Trustee, a Request for Release,
and the Custodian shall release, or the Trustee shall cause the Custodian to
release, to the Seller the related Mortgage File and the Trustee shall execute
and deliver all instruments of transfer or assignment furnished to it by the
Seller, without recourse, representation or warranty as are necessary to vest in
the Seller title to and rights under the Mortgage Loan or any property acquired
with respect thereto. Such purchase shall be deemed to have occurred on the date
on which the Repurchase Price in available funds is received by the Trustee. The
Master Servicer shall amend the Mortgage Loan Schedule to reflect such
repurchase and shall promptly notify the Trustee and the Rating Agencies of such
amendment. Enforcement of the obligation of the Seller to purchase (or
substitute a Substitute Mortgage Loan for) any Mortgage Loan or any property
acquired with respect thereto (or pay the Repurchase Price as set forth in the
above proviso) as to which a breach has occurred and is continuing shall
constitute the sole remedy respecting such breach available to the
Certificateholders or the Trustee on their behalf.
Section 2.04 SUBSTITUTION OF MORTGAGE LOANS.
Notwithstanding anything to the contrary in this Agreement, in lieu of
purchasing a Mortgage Loan pursuant to the Mortgage Loan Purchase Agreement or
Sections 2.02 or 2.03 of this Agreement, the Seller may, no later than the date
by which such purchase by the Seller would otherwise be required, tender to the
Trustee a Substitute Mortgage Loan accompanied by a certificate of an authorized
officer of the Seller that such Substitute Mortgage Loan conforms to the
requirements set forth in the definition of "Substitute Mortgage Loan" in this
Agreement; provided, however, that substitution pursuant to the Mortgage Loan
Purchase Agreement or Section 2.04 of this Agreement, as applicable, in lieu of
purchase shall not be permitted after the termination of the two-year period
beginning on the Startup Day; provided, further, that if the breach would cause
the Mortgage Loan to be other than a "qualified mortgage" as defined in Section
860G(a)(3) of the Code, any such cure or substitution must occur within 90 days
from the date the breach was discovered. The Custodian, as agent for the
Trustee, shall examine the Mortgage File for any Substitute Mortgage Loan in the
manner set forth in Section 2.02(a) and the Trustee or the Custodian, as its
agent, shall notify the Seller, in writing, within five Business Days after
receipt, whether or not the documents relating to the Substitute Mortgage Loan
satisfy the requirements of the fifth sentence of Subsection 2.02(a). Within two
Business Days after such notification, the Seller shall provide to the Master
Servicer for deposit in the Master Servicer Collection Account the amount, if
any, by which the Outstanding Principal Balance as of the next preceding Due
Date of the Mortgage Loan for which substitution is being made, after giving
effect to the Scheduled Principal due on such date, exceeds the Outstanding
Principal Balance as of such date of the Substitute Mortgage Loan, after giving
effect to Scheduled Principal due on such date, which amount shall be treated
for the purposes of this Agreement as if it were the payment by the Seller of
the Repurchase Price for the purchase of a Mortgage Loan by the Seller. After
such notification to the Seller and, if any such excess exists, upon receipt of
such deposit, the Trustee shall accept such Substitute Mortgage Loan which shall
thereafter be deemed to be a Mortgage Loan hereunder. In the event of such a
substitution, accrued interest on the Substitute Mortgage Loan for the month in
which the substitution occurs and any Principal Prepayments made thereon during
such month shall be the property of the Trust Fund and accrued interest for such
month on the Mortgage Loan for which the substitution is made and any Principal
Prepayments made thereon during such month shall be the property of the Seller.
The Scheduled Principal on a Substitute Mortgage Loan due on the Due Date in the
month of substitution shall be the property of the Seller and the Scheduled
Principal on the Mortgage Loan for which the substitution is made due on such
Due Date shall be the property of the Trust Fund. Upon acceptance of the
Substitute Mortgage Loan (and delivery to the Custodian of a Request for Release
for such Mortgage Loan), the Custodian, as agent for the Trustee, shall release
to the Seller the related Mortgage File related to any Mortgage Loan released
pursuant to the Mortgage Loan Purchase Agreement or Section 2.04 of this
Agreement, as applicable, and shall execute and deliver all instruments of
transfer or assignment, without recourse, representation or warranty in form as
provided to it as are necessary to vest in the Seller title to and rights under
any Mortgage Loan released pursuant to the Mortgage Loan Purchase Agreement or
Section 2.04 of this Agreement, as applicable. The Seller shall deliver to the
Custodian the documents related to the Substitute Mortgage Loan in accordance
with the provisions of the Mortgage Loan Purchase Agreement or Subsections
2.01(b) and 2.02(b) of this Agreement, as applicable, with the date of
acceptance of the Substitute Mortgage Loan deemed to be the Closing Date for
purposes of the time periods set forth in those Subsections. The representations
and warranties set forth in the Mortgage Loan Purchase Agreement shall be deemed
to have been made by the Seller with respect to each Substitute Mortgage Loan as
of the date of acceptance of such Mortgage Loan by the Trustee. The Master
Servicer shall amend the Mortgage Loan Schedule to reflect such substitution and
shall provide a copy of such amended Mortgage Loan Schedule to the Trustee and
the Rating Agencies.
Section 2.05 ISSUANCE OF CERTIFICATES.
(a) The Trustee acknowledges the assignment to it of the Mortgage Loans
and the other assets comprising the Trust Funds and, concurrently therewith, the
Certificate Registrar has signed, and countersigned and delivered to the
Depositor, in exchange therefor, the Certificates in such authorized
denominations representing such Fractional Undivided Interests as the Depositor
has requested. The Trustee agrees that it will hold the Mortgage Loans and such
other assets as may from time to time be delivered to it segregated on the books
of the Trustee in trust for the benefit of the related Certificateholders.
(b) The Depositor, concurrently with the execution and delivery hereof,
does hereby transfer, assign, set over and otherwise convey in trust to the
Trustee without recourse all the right, title and interest of the Depositor in
and to the REMIC I Regular Interests and REMIC II Regular Interests, and the
other assets of REMIC III for the benefit of the holders of the REMIC III
Interests. The Trustee acknowledges receipt of the REMIC I Regular Interests and
REMIC II Regular Interests (all of which are uncertificated) and the other
assets of REMIC III and declares that it holds and will hold the same in trust
for the exclusive use and benefit of the holders of the REMIC III Interests.
Section 2.06 REPRESENTATIONS AND WARRANTIES CONCERNING THE DEPOSITOR.
The Depositor hereby represents and warrants to the Trustee, the Master
Servicer and the Securities Administrator as follows:
(a) the Depositor (i) is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware and (ii) is
qualified and in good standing as a foreign corporation to do business in each
jurisdiction where such qualification is necessary, except where the failure so
to qualify would not reasonably be expected to have a material adverse effect on
the Depositor's business as presently conducted or on the Depositor's ability to
enter into this Agreement and to consummate the transactions contemplated
hereby;
(b) the Depositor has full corporate power to own its property, to
carry on its business as presently conducted and to enter into and perform its
obligations under this Agreement;
(c) the execution and delivery by the Depositor of this Agreement have
been duly authorized by all necessary corporate action on the part of the
Depositor; and neither the execution and delivery of this Agreement, nor the
consummation of the transactions herein contemplated, nor compliance with the
provisions hereof, will conflict with or result in a breach of, or constitute a
default under, any of the provisions of any law, governmental rule, regulation,
judgment, decree or order binding on the Depositor or its properties or the
articles of incorporation or by-laws of the Depositor, except those conflicts,
breaches or defaults which would not reasonably be expected to have a material
adverse effect on the Depositor's ability to enter into this Agreement and to
consummate the transactions contemplated hereby;
(d) the execution, delivery and performance by the Depositor of this
Agreement and the consummation of the transactions contemplated hereby do not
require the consent or approval of, the giving of notice to, the registration
with, or the taking of any other action in respect of, any state, federal or
other governmental authority or agency, except those consents, approvals,
notices, registrations or other actions as have already been obtained, given or
made;
(e) this Agreement has been duly executed and delivered by the
Depositor and, assuming due authorization, execution and delivery by the other
parties hereto, constitutes a valid and binding obligation of the Depositor
enforceable against it in accordance with its terms (subject to applicable
bankruptcy and insolvency laws and other similar laws affecting the enforcement
of the rights of creditors generally);
(f) there are no actions, suits or proceedings pending or, to the
knowledge of the Depositor, threatened against the Depositor, before or by any
court, administrative agency, arbitrator or governmental body (i) with respect
to any of the transactions contemplated by this Agreement or (ii) with respect
to any other matter which in the judgment of the Depositor will be determined
adversely to the Depositor and will if determined adversely to the Depositor
materially and adversely affect the Depositor's ability to enter into this
Agreement or perform its obligations under this Agreement; and the Depositor is
not in default with respect to any order of any court, administrative agency,
arbitrator or governmental body so as to materially and adversely affect the
transactions contemplated by this Agreement; and
(g) immediately prior to the transfer and assignment to the Trustee,
each Mortgage Note and each Mortgage were not subject to an assignment or
pledge, and the Depositor had good and marketable title to and was the sole
owner thereof and had full right to transfer and sell such Mortgage Loan to the
Trustee free and clear of any encumbrance, equity, lien, pledge, charge, claim
or security interest.
ARTICLE III
Administration of the Trust Fund and Servicing of Mortgage Loans
Section 3.01 MASTER SERVICER AND SECURITIES ADMINISTRATOR.
The Master Servicer shall supervise, monitor and oversee the obligation
of the Servicers to service and administer their respective Mortgage Loans in
accordance with the terms of the applicable Servicing Agreements and shall have
full power and authority to do any and all things which it may deem necessary or
desirable in connection with such master servicing and administration. In
performing its obligations hereunder, the Master Servicer shall act in a manner
consistent with Accepted Master Servicing Practices. Furthermore, the Master
Servicer shall oversee and consult with each Servicer as necessary from
time-to-time to carry out the Master Servicer's obligations hereunder, shall
receive, review and evaluate all reports, information and other data provided to
the Master Servicer by each Servicer and shall cause each Servicer to perform
and observe the covenants, obligations and conditions to be performed or
observed by such Servicer under its applicable Servicing Agreement. The Master
Servicer shall independently and separately monitor each Servicer's servicing
activities with respect to each related Mortgage Loan, reconcile the results of
such monitoring with such information provided in the previous sentence on a
monthly basis and coordinate corrective adjustments to the Servicers' and Master
Servicer's records, and based on such reconciled and corrected information, the
Master Servicer shall provide such information to the Securities Administrator
as shall be necessary in order for it to prepare the statements specified in
Section 6.05(a), and prepare any other information and statements required to be
forwarded by the Master Servicer hereunder. The Master Servicer shall reconcile
the results of its Mortgage Loan monitoring with the actual remittances of the
Servicers pursuant to the applicable Servicing Agreements.
The Trustee shall furnish the Servicers and the Master Servicer with
any powers of attorney and other documents in form as provided to it necessary
or appropriate to enable the Servicers and the Master Servicer to service and
administer the related Mortgage Loans and REO Property. The Trustee shall be
indemnified by the Master Servicer for any costs, liabilities or expenses
incurred by it in connection with such powers of attorney.
The Trustee or the Custodian shall provide access to the records and
documentation in possession of the Trustee regarding the related Mortgage Loans
and REO Property and the servicing thereof to the related Certificateholders,
the FDIC, and the supervisory agents and examiners of the FDIC, such access
being afforded only upon reasonable prior written request and during normal
business hours at the office of the Trustee; provided, however, that, unless
otherwise required by law, the Trustee shall not be required to provide access
to such records and documentation if the provision thereof would violate the
legal right to privacy of any Mortgagor. The Trustee shall allow representatives
of the above entities to photocopy any of the records and documentation and
shall provide equipment for that purpose at a charge that covers the Trustee's
actual costs.
The Trustee shall execute and deliver to the related Servicer and the
Master Servicer any court pleadings, requests for trustee's sale or other
documents necessary or desirable to (i) the foreclosure or trustee's sale with
respect to a Mortgaged Property; (ii) any legal action brought to obtain
judgment against any Mortgagor on the Mortgage Note or Security Instrument;
(iii) obtain a deficiency judgment against the Mortgagor; or (iv) enforce any
other rights or remedies provided by the Mortgage Note or Security Instrument or
otherwise available at law or equity.
Section 3.02 REMIC-RELATED COVENANTS.
For as long as each REMIC shall exist, the Trustee and the Securities
Administrator shall act in accordance herewith to assure continuing treatment of
such REMIC as a REMIC, and the Trustee and the Securities Administrator shall
comply with any directions of the Depositor, the related Servicer or the Master
Servicer to assure such continuing treatment. In particular, the Trustee shall
not (a) sell or permit the sale of all or any portion of the Mortgage Loans or
of any investment of deposits in an Account unless such sale is as a result of a
repurchase of the Mortgage Loans pursuant to this Agreement or the Trustee has
received a REMIC Opinion addressed to the Trustee prepared at the expense of the
Trust Fund; and (b) other than with respect to a substitution pursuant to the
Mortgage Loan Purchase Agreement or Section 2.04 of this Agreement, as
applicable, accept any contribution to any REMIC after the Startup Day without
receipt of a REMIC Opinion addressed to the Trustee.
Section 3.03 MONITORING OF SERVICERS.
(a) The Master Servicer shall be responsible for reporting to the
Trustee and the Depositor the compliance by each Servicer with its duties under
the related Servicing Agreement. In the review of each Servicer's activities,
the Master Servicer may rely upon an officer's certificate of the Servicer (or
similar document signed by an officer of the Servicer) with regard to such
Servicer's compliance with the terms of its Servicing Agreement. In the event
that the Master Servicer, in its judgment, determines that a Servicer (other
than Xxxxx Fargo) should be terminated in accordance with its Servicing
Agreement, or that a notice should be sent pursuant to such Servicing Agreement
with respect to the occurrence of an event that, unless cured, would constitute
grounds for such termination, the Master Servicer shall notify the Depositor and
the Trustee thereof and the Master Servicer shall issue such notice or take such
other action as it deems appropriate. In the event that the Master Servicer, in
its judgment, determines that Xxxxx Fargo should be terminated in accordance
with the Xxxxx Fargo Servicing Agreement, or that a notice should be sent
pursuant to the Xxxxx Fargo Servicing Agreement with respect to the occurrence
of an event that, unless cured, would constitute grounds for such termination,
the Master Servicer shall notify the Depositor and the Trustee thereof in
writing. Pursuant to its receipt of such written notification from the Master
Servicer, the Trustee shall issue such notice of termination to Xxxxx Fargo or
take such other action as it deems appropriate.
(b) The Master Servicer, for the benefit of the Trustee and the
Certificateholders, shall enforce the obligations of each Servicer under the
related Servicing Agreement, and shall, in the event that a Servicer other than
Xxxxx Fargo fails to perform its obligations in accordance with the related
Servicing Agreement, subject to the preceding paragraph, terminate the rights
and obligations of such Servicer thereunder and act as servicer of the related
Mortgage Loans or to cause the Trustee to enter into a new Servicing Agreement
with a successor Servicer selected by the Master Servicer; provided, however, it
is understood and acknowledged by the parties hereto that there will be a period
of transition (not to exceed 90 days) before the actual servicing functions can
be fully transferred to such successor Servicer. In the event that Xxxxx Fargo
fails to perform its obligations in accordance with the Xxxxx Fargo Servicing
Agreement, subject to the preceding paragraph, the Master Servicer shall notify
the Trustee in writing of such failure. Pursuant to its receipt of such
notification from the Master Servicer, the Trustee shall terminate the rights
and obligations of Xxxxx Fargo under the Xxxxx Fargo Servicing Agreement and
enter in to a new Servicing Agreement with a successor Servicer selected by the
Trustee; provided, however, it is understood and acknowledged by the parties
hereto that there will be a period of transition (not to exceed 90 days) before
the actual servicing functions can be fully transferred to such successor
Servicer. In either event, such enforcement, including, without limitation, the
legal prosecution of claims, termination of Servicing Agreements and the pursuit
of other appropriate remedies, shall be in such form and carried out to such an
extent and at such time as the Master Servicer (or in the case Xxxxx Fargo is
terminated as the Servicer, the Trustee) in its good faith business judgment,
would require were it the owner of the related Mortgage Loans. The Master
Servicer shall pay the costs of such enforcement at its own expense, provided
that the Master Servicer shall not be required to prosecute or defend any legal
action except to the extent that the Master Servicer shall have received
reasonable indemnity for its costs and expenses in pursuing such action. In the
event that Xxxxx Fargo is terminated as the Servicer, the Trustee shall pay the
costs of such enforcement at its own expense, subject to its right to be
reimbursed for such costs from the Master Servicer Collection Account pursuant
to Section 3.03(c); provided that the Trustee shall not be required to prosecute
or defend any legal action except to the extent that the Trustee shall have
received reasonable indemnity for its costs and expenses in pursuing such
action. Nothing herein shall impose any obligation on the part of the Trustee to
assume or succeed to the duties or obligations of Xxxxx Fargo or the Master
Servicer.
(c) In the event that Xxxxx Fargo is terminated as Servicer, to the
extent that the costs and expenses of the Trustee related to any termination of
Xxxxx Fargo, or the enforcement or prosecution of related claims, rights or
remedies, or the appointment of a successor Servicer (including, without
limitation, (i) all legal costs and expenses and all due diligence costs and
expenses associated with an evaluation of the potential termination of the Xxxxx
Fargo as a result of an event of default by Xxxxx Fargo and (ii) all costs and
expenses associated with the complete transfer of servicing, including all
servicing files and all servicing data and the completion, correction or
manipulation of such servicing data as may be required by the successor Servicer
to correct any errors or insufficiencies in the servicing data or otherwise to
enable the successor Servicer to service the Mortgage Loans in accordance with
the related Servicing Agreement) are not fully and timely reimbursed by Xxxxx
Fargo after such termination, the Trustee shall be entitled to reimbursement of
such costs and expenses from the Master Servicer Collection Account (which the
Master Servicer hereby agrees to pay to the Trustee from the Master Servicer
Collection Account upon demand) or, to the extent not paid from such account,
the Trustee shall be entitled to reimburse itself for such costs and expenses
from the Distribution Account. In all other cases, to the extent that the costs
and expenses of the Master Servicer related to any termination of a Servicer
(other than Xxxxx Fargo), appointment of a successor Servicer or the transfer
and assumption of servicing by the Master Servicer with respect to any Servicing
Agreement (including, without limitation, (i) all legal costs and expenses and
all due diligence costs and expenses associated with an evaluation of the
potential termination of the Servicer as a result of an event of default by such
Servicer and (ii) all costs and expenses associated with the complete transfer
of servicing, including all servicing files and all servicing data and the
completion, correction or manipulation of such servicing data as may be required
by the successor servicer to correct any errors or insufficiencies in the
servicing data or otherwise to enable the successor servicer to service the
Mortgage Loans in accordance with the related Servicing Agreement) are not fully
and timely reimbursed by the terminated Servicer, the Master Servicer shall be
entitled to reimbursement of such costs and expenses from the Master Servicer
Collection Account.
(d) The Master Servicer shall require each Servicer to comply with the
remittance requirements and other obligations set forth in the related Servicing
Agreement.
(e) If the Master Servicer acts as Servicer, it will not assume
liability for the representations and warranties of the Servicer (other than
Xxxxx Fargo), if any, that it replaces.
Section 3.04 FIDELITY BOND.
The Master Servicer, at its expense, shall maintain in effect a blanket
fidelity bond and an errors and omissions insurance policy, affording coverage
with respect to all directors, officers, employees and other Persons acting on
such Master Servicer's behalf, and covering errors and omissions in the
performance of the Master Servicer's obligations hereunder. The errors and
omissions insurance policy and the fidelity bond shall be in such form and
amount generally acceptable for entities serving as master servicers or
trustees.
Section 3.05 POWER TO ACT; PROCEDURES.
The Master Servicer shall master service the Mortgage Loans and shall
have full power and authority, subject to the REMIC Provisions and the
provisions of Article X hereof, to do any and all things that it may deem
necessary or desirable in connection with the master servicing and
administration of the Mortgage Loans, including but not limited to the power and
authority (i) to execute and deliver, on behalf of the Holders of the
Certificates and the Trustee, customary consents or waivers and other
instruments and documents, (ii) to consent to transfers of any Mortgaged
Property and assumptions of the Mortgage Notes and related Mortgages, (iii) to
collect any Insurance Proceeds, Liquidation Proceeds and Subsequent Recoveries,
and (iv) to effectuate foreclosure or other conversion of the ownership of the
Mortgaged Property securing any Mortgage Loan, in each case, in accordance with
the provisions of this Agreement and the related Servicing Agreement, as
applicable; provided, however, that the Master Servicer shall not (and,
consistent with its responsibilities under Section 3.03, shall not permit any
Servicer to) knowingly or intentionally take any action, or fail to take (or
fail to cause to be taken) any action reasonably within its control and the
scope of duties more specifically set forth herein, that, under the REMIC
Provisions, if taken or not taken, as the case may be, would cause any related
REMIC to fail to qualify as a REMIC or result in the imposition of a tax upon
the Trust Funds (including but not limited to the tax on prohibited transactions
as defined in Section 860F(a)(2) of the Code and the tax on contributions to a
REMIC set forth in Section 860G(d) of the Code) unless the Master Servicer has
received an Opinion of Counsel (but not at the expense of the Master Servicer)
to the effect that the contemplated action would not cause any REMIC to fail to
qualify as a REMIC or result in the imposition of a tax upon any REMIC. The
Trustee shall furnish the Master Servicer, upon written request from a Servicing
Officer, with any powers of attorney empowering the Master Servicer or any
Servicer to execute and deliver instruments of satisfaction or cancellation, or
of partial or full release or discharge, and to foreclose upon or otherwise
liquidate Mortgaged Property, and to appeal, prosecute or defend in any court
action relating to the Mortgage Loans or the Mortgaged Property, in accordance
with the related Servicing Agreement and this Agreement, and the Trustee shall
execute and deliver such other documents, as the Master Servicer may request, to
enable the Master Servicer to master service and administer the Mortgage Loans
and carry out its duties hereunder, in each case in accordance with Accepted
Master Servicing Practices (and the Trustee shall have no liability for misuse
of any such powers of attorney by the Master Servicer or any Servicer). If the
Master Servicer or the Trustee has been advised that it is likely that the laws
of the state in which action is to be taken prohibit such action if taken in the
name of the Trustee or that the Trustee would be adversely affected under the
"doing business" or tax laws of such state if such action is taken in its name,
the Master Servicer shall join with the Trustee in the appointment of a
co-trustee pursuant to Section 9.11 hereof. In the performance of its duties
hereunder, the Master Servicer shall be an independent contractor and shall not,
except in those instances where it is taking action in the name of the Trustee,
be deemed to be the agent of the Trustee.
Section 3.06 DUE-ON-SALE CLAUSES; ASSUMPTION AGREEMENTS.
To the extent provided in the applicable Servicing Agreement, to the
extent Mortgage Loans contain enforceable due-on-sale clauses, the Master
Servicer shall cause the Servicers to enforce such clauses in accordance with
the applicable Servicing Agreement. If applicable law prohibits the enforcement
of a due-on-sale clause or such clause is otherwise not enforced in accordance
with the applicable Servicing Agreement, and, as a consequence, a Mortgage Loan
is assumed, the original Mortgagor may be released from liability in accordance
with the Servicing Agreement.
Section 3.07 RELEASE OF MORTGAGE FILES.
(a) Upon becoming aware of the payment in full of any Mortgage Loan, or
the receipt by any Servicer of a notification that payment in full has been
escrowed in a manner customary for such purposes for payment to related
Certificateholders on the next Distribution Date, the Servicer will, if required
under the applicable Servicing Agreement (or if the applicable Servicer does
not, the Master Servicer may), promptly furnish to the Custodian, on behalf of
the Trustee, two copies of a certification substantially in the form of Exhibit
D hereto signed by a Servicing Officer or in a mutually agreeable electronic
format which will, in lieu of a signature on its face, originate from a
Servicing Officer (which certification shall include a statement to the effect
that all amounts received in connection with such payment that are required to
be deposited in the Protected Account maintained by the applicable Servicer
pursuant to Section 4.01 or by the applicable Servicer pursuant to the
applicable Servicing Agreement have been or will be so deposited) and shall
request that the Custodian, on behalf of the Trustee, deliver to the Servicer
the related Mortgage File. Upon receipt of such certification and request, the
Custodian, on behalf of the Trustee, shall promptly release the related Mortgage
File to the Servicer and the Trustee and Custodian shall have no further
responsibility with regard to such Mortgage File. Upon any such payment in full,
each Servicer is authorized, to give, as agent for the Trustee, as the mortgagee
under the Mortgage that secured the Mortgage Loan, an instrument of satisfaction
(or assignment of mortgage without recourse) regarding the Mortgaged Property
subject to the Mortgage, which instrument of satisfaction or assignment, as the
case may be, shall be delivered to the Person or Persons entitled thereto
against receipt therefor of such payment, it being understood and agreed that no
expenses incurred in connection with such instrument of satisfaction or
assignment, as the case may be, shall be chargeable to the Protected Account.
(b) From time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan and in accordance with the applicable Servicing
Agreement, the Trustee shall execute such documents as shall be prepared and
furnished to the Trustee by a Servicer or the Master Servicer (in form
reasonably acceptable to the Trustee) and as are necessary to the prosecution of
any such proceedings. The Custodian, on behalf of the Trustee, shall, upon the
request of a Servicer or the Master Servicer, and delivery to the Custodian, on
behalf of the Trustee, of two copies of a request for release signed by a
Servicing Officer substantially in the form of Exhibit D (or in a mutually
agreeable electronic format which will, in lieu of a signature on its face,
originate from a Servicing Officer), release the related Mortgage File held in
its possession or control to the Servicer or the Master Servicer. Such trust
receipt shall obligate the Servicer or the Master Servicer to return the
Mortgage File to the Custodian on behalf of the Trustee, when the need therefor
by the Servicer or the Master Servicer no longer exists unless the Mortgage Loan
shall be liquidated, in which case, upon receipt of a certificate of a Servicing
Officer similar to that hereinabove specified, the Mortgage File shall be
released by the Custodian, on behalf of the Trustee, to the Servicer or the
Master Servicer.
Section 3.08 DOCUMENTS, RECORDS AND FUNDS IN POSSESSION OF MASTER
SERVICER TO BE HELD FOR TRUSTEE.
(a) The Master Servicer shall transmit and each Servicer (to the extent
required by the related Servicing Agreement) shall transmit to the Trustee or
Custodian such documents and instruments coming into the possession of the
Master Servicer or such Servicer from time to time as are required by the terms
hereof, or in the case of the Servicers, the applicable Servicing Agreement, to
be delivered to the Trustee or Custodian. Any funds received by the Master
Servicer or by a Servicer in respect of any Mortgage Loan or which otherwise are
collected by the Master Servicer or by a Servicer as Liquidation Proceeds,
Insurance Proceeds or Subsequent Recoveries in respect of any Mortgage Loan
shall be held for the benefit of the Trustee and the related Certificateholders
subject to the Master Servicer's right to retain or withdraw from the Master
Servicer Collection Account the Master Servicing Compensation and other amounts
provided in this Agreement, and to the right of each Servicer to retain its
Servicing Fee and other amounts as provided in the applicable Servicing
Agreement. The Master Servicer shall, and (to the extent provided in the
applicable Servicing Agreement) shall cause each Servicer to, provide access to
information and documentation regarding the Mortgage Loans to the Trustee, its
agents and accountants at any time upon reasonable request and during normal
business hours, to related Certificateholders that are savings and loan
associations, banks or insurance companies, the Office of Thrift Supervision,
the FDIC and the supervisory agents and examiners of such Office and Corporation
or examiners of any other federal or state banking or insurance regulatory
authority if so required by applicable regulations of the Office of Thrift
Supervision or other regulatory authority, such access to be afforded without
charge but only upon reasonable request in writing and during normal business
hours at the offices of the Master Servicer designated by it. In fulfilling such
a request the Master Servicer shall not be responsible for determining the
sufficiency of such information.
(b) All Mortgage Files and funds collected or held by, or under the
control of, the Master Servicer, in respect of any Mortgage Loans, whether from
the collection of principal and interest payments or from Liquidation Proceeds,
Insurance Proceeds or Subsequent Recoveries, shall be held by the Master
Servicer for and on behalf of the Trustee and the related Certificateholders and
shall be and remain the sole and exclusive property of the Trustee; provided,
however, that the Master Servicer and each Servicer shall be entitled to setoff
against, and deduct from, any such funds any amounts that are properly due and
payable to the Master Servicer or such Servicer under this Agreement or the
applicable Servicing Agreement.
Section 3.09 STANDARD HAZARD INSURANCE AND FLOOD INSURANCE POLICIES.
(a) For each Mortgage Loan, the Master Servicer shall enforce any
obligation of the Servicers under the related Servicing Agreements to maintain
or cause to be maintained standard fire and casualty insurance and, where
applicable, flood insurance, all in accordance with the provisions of the
related Servicing Agreements. It is understood and agreed that such insurance
shall be with insurers meeting the eligibility requirements set forth in the
applicable Servicing Agreement and that no earthquake or other additional
insurance is to be required of any Mortgagor or to be maintained on property
acquired in respect of a defaulted loan, other than pursuant to such applicable
laws and regulations as shall at any time be in force and as shall require such
additional insurance.
(b) Pursuant to Section 4.01 and 4.02, any amounts collected by the
Servicers or the Master Servicer, or by any Servicer, under any insurance
policies (other than amounts to be applied to the restoration or repair of the
property subject to the related Mortgage or released to the Mortgagor in
accordance with the applicable Servicing Agreement) shall be deposited into the
Master Servicer Collection Account, subject to withdrawal pursuant to Section
4.02 and 4.03. Any cost incurred by the Master Servicer or any Servicer in
maintaining any such insurance if the Mortgagor defaults in its obligation to do
so shall be added to the amount owing under the Mortgage Loan where the terms of
the Mortgage Loan so permit; provided, however, that the addition of any such
cost shall not be taken into account for purposes of calculating the
distributions to be made to Certificateholders and shall be recoverable by the
Master Servicer or such Servicer pursuant to Section 4.02 and 4.03.
Section 3.10 PRESENTMENT OF CLAIMS AND COLLECTION OF PROCEEDS.
The Master Servicer shall (to the extent provided in the applicable
Servicing Agreement) cause the related Servicer to prepare and present on behalf
of the Trustee and the Certificateholders all claims under the Insurance
Policies and take such actions (including the negotiation, settlement,
compromise or enforcement of the insured's claim) as shall be necessary to
realize recovery under such policies. Any proceeds disbursed to the Master
Servicer (or disbursed to a Servicer and remitted to the Master Servicer) in
respect of such policies, bonds or contracts shall be promptly deposited in the
Master Servicer Collection Account upon receipt, except that any amounts
realized that are to be applied to the repair or restoration of the related
Mortgaged Property as a condition precedent to the presentation of claims on the
related Mortgage Loan to the insurer under any applicable Insurance Policy need
not be so deposited (or remitted).
Section 3.11 MAINTENANCE OF THE PRIMARY MORTGAGE INSURANCE POLICIES.
(a) The Master Servicer shall not take, or permit any Servicer (to the
extent such action is prohibited under the applicable Servicing Agreement) to
take, any action that would result in noncoverage under any applicable Primary
Mortgage Insurance Policy of any loss which, but for the actions of the Master
Servicer or such Servicer, would have been covered thereunder. The Master
Servicer shall use its best reasonable efforts to cause each Servicer (to the
extent required under the related Servicing Agreement) to keep in force and
effect (to the extent that the Mortgage Loan requires the Mortgagor to maintain
such insurance), primary mortgage insurance applicable to each Mortgage Loan in
accordance with the provisions of this Agreement and the related Servicing
Agreement, as applicable. The Master Servicer shall not, and shall not permit
any Servicer (to the extent required under the related Servicing Agreement) to,
cancel or refuse to renew any such Primary Mortgage Insurance Policy that is in
effect at the date of the initial issuance of the Mortgage Note and is required
to be kept in force hereunder except in accordance with the provisions of this
Agreement and the related Servicing Agreement, as applicable.
(b) The Master Servicer agrees to present, or to cause each Servicer
(to the extent required under the related Servicing Agreement) to present, on
behalf of the Trustee and the Certificateholders, claims to the insurer under
any Primary Mortgage Insurance Policies and, in this regard, to take such
reasonable action as shall be necessary to permit recovery under any Primary
Mortgage Insurance Policies respecting defaulted Mortgage Loans. Pursuant to
Section 4.01 and 4.02, any amounts collected by the Master Servicer or any
Servicer under any Primary Mortgage Insurance Policies shall be deposited in the
Master Servicer Collection Account, subject to withdrawal pursuant to Sections
4.02 and 4.03.
Section 3.12 TRUSTEE TO RETAIN POSSESSION OF CERTAIN INSURANCE
POLICIES AND DOCUMENTS.
The Trustee (or the Custodian, as directed by the Trustee), shall
retain possession and custody of the originals (to the extent available) of any
Primary Mortgage Insurance Policies, or certificate of insurance if applicable,
and any certificates of renewal as to the foregoing as may be issued from time
to time as contemplated by this Agreement. Until all amounts distributable in
respect of the Certificates have been distributed in full and the Master
Servicer otherwise has fulfilled its obligations under this Agreement, the
Trustee (or its Custodian, if any, as directed by the Trustee) shall also retain
possession and custody of each Mortgage File in accordance with and subject to
the terms and conditions of this Agreement. The Master Servicer shall promptly
deliver or cause to be delivered to the Trustee (or the Custodian, as directed
by the Trustee), upon the execution or receipt thereof the originals of any
Primary Mortgage Insurance Policies, any certificates of renewal, and such other
documents or instruments that constitute portions of the Mortgage File that come
into the possession of the Master Servicer from time to time.
Section 3.13 REALIZATION UPON DEFAULTED MORTGAGE LOANS.
The Master Servicer shall cause each Servicer (to the extent required
under the related Servicing Agreement) to foreclose upon, repossess or otherwise
comparably convert the ownership of Mortgaged Properties securing such of the
Mortgage Loans as come into and continue in default and as to which no
satisfactory arrangements can be made for collection of delinquent payments, all
in accordance with the applicable Servicing Agreement.
Section 3.14 COMPENSATION FOR THE MASTER SERVICER.
The Master Servicer will be entitled to (i) the Master Servicing Fee;
provided, that the aggregate Master Servicing Fee with respect to any
Distribution Date shall be reduced by an amount equal to the Compensating
Interest payable by the Master Servicer for such Distribution Date pursuant to
Section 6.07 hereof, plus (ii) all income and gain realized from any investment
of funds in the Distribution Account and the Master Servicer Collection Account,
pursuant to Article IV, for the performance of its activities hereunder.
Servicing compensation in the form of assumption fees, if any, late payment
charges, as collected, if any, or otherwise (but not including any prepayment
premium or penalty) shall be retained by the applicable Servicer and shall not
be deposited in the Protected Account. The Master Servicer shall be required to
pay all expenses incurred by it in connection with its activities hereunder and
shall not be entitled to reimbursement therefor except as provided in this
Agreement.
Section 3.15 REO PROPERTY.
(a) In the event the Trust Fund acquires ownership of any REO Property
in respect of any related Mortgage Loan, the deed or certificate of sale shall
be issued to the Trustee, or to its nominee, on behalf of the related
Certificateholders. The Master Servicer shall, to the extent provided in the
applicable Servicing Agreement, cause the applicable Servicer to sell any REO
Property as expeditiously as possible and in accordance with the provisions of
this Agreement and the related Servicing Agreement, as applicable. Pursuant to
its efforts to sell such REO Property, the Master Servicer shall cause the
applicable Servicer to protect and conserve, such REO Property in the manner and
to the extent required by the applicable Servicing Agreement, in accordance with
the REMIC Provisions and in a manner that does not result in a tax on "net
income from foreclosure property" or cause such REO Property to fail to qualify
as "foreclosure property" within the meaning of Section 860G(a)(8) of the Code.
(b) The Master Servicer shall, to the extent required by the related
Servicing Agreement, cause the applicable Servicer to deposit all funds
collected and received in connection with the operation of any REO Property in
the Protected Account.
(c) The Master Servicer and the applicable Servicer, upon the final
disposition of any REO Property, shall be entitled to reimbursement for any
related unreimbursed Monthly Advances and other unreimbursed advances as well as
any unpaid Servicing Fees from Liquidation Proceeds received in connection with
the final disposition of such REO Property; provided, that any such unreimbursed
Monthly Advances as well as any unpaid Servicing Fees may be reimbursed or paid,
as the case may be, prior to final disposition, out of any net rental income or
other net amounts derived from such REO Property.
(d) To the extent provided in the related Servicing Agreement, the
Liquidation Proceeds from the final disposition of the REO Property, net of any
payment to the Master Servicer and the applicable Servicer as provided above
shall be deposited in the Protected Account on or prior to the Determination
Date in the month following receipt thereof and be remitted by wire transfer in
immediately available funds to the Master Servicer for deposit into the related
Master Servicer Collection Account on the next succeeding Servicer Remittance
Date.
Section 3.16 ANNUAL OFFICER'S CERTIFICATE AS TO COMPLIANCE.
(a) The Master Servicer shall deliver to the Trustee and the Rating
Agencies on or before March 1 of each year, commencing on March 1, 2006, an
Officer's Certificate, certifying that with respect to the period ending
December 31 of the prior year: (i) such Servicing Officer has reviewed the
activities of such Master Servicer during the preceding calendar year or portion
thereof and its performance under this Agreement, (ii) to the best of such
Servicing Officer's knowledge, based on such review, such Master Servicer has
performed and fulfilled its duties, responsibilities and obligations under this
Agreement in all material respects throughout such year, or, if there has been a
default in the fulfillment of any such duties, responsibilities or obligations,
specifying each such default known to such Servicing Officer and the nature and
status thereof, (iii) nothing has come to the attention of such Servicing
Officer to lead such Servicing Officer to believe that any Servicer has failed
to perform any of its duties, responsibilities and obligations under its
Servicing Agreement in all material respects throughout such year, or, if there
has been a material default in the performance or fulfillment of any such
duties, responsibilities or obligations, specifying each such default known to
such Servicing Officer and the nature and status thereof.
(b) Copies of such statements shall be provided to any
Certificateholder upon request, by the Master Servicer or by the Trustee at the
Master Servicer's expense if the Master Servicer failed to provide such copies
(unless (i) the Master Servicer shall have failed to provide the Trustee with
such statement or (ii) the Trustee shall be unaware of the Master Servicer's
failure to provide such statement).
Section 3.17 ANNUAL INDEPENDENT ACCOUNTANT'S SERVICING REPORT.
If the Master Servicer has, during the course of any calendar year,
directly serviced any of the Mortgage Loans, then the Master Servicer at its
expense shall cause a nationally recognized firm of independent certified public
accountants to furnish a statement to the Trustee, the Rating Agencies and the
Depositor on or before March 1 of each year to the effect that, with respect to
the most recently ended calendar year, such firm has examined certain records
and documents relating to the Master Servicer's performance of its servicing
obligations under this Agreement and pooling and servicing and trust agreements
in material respects similar to this Agreement and to each other and that, on
the basis of such examination conducted substantially in compliance with the
audit program for mortgages serviced for Xxxxxxx Mac or the Uniform Single
Attestation Program for Mortgage Bankers, such firm is of the opinion that the
Master Servicer's activities have been conducted in compliance with this
Agreement, or that such examination has disclosed no material items of
noncompliance except for (i) such exceptions as such firm believes to be
immaterial, (ii) such other exceptions as are set forth in such statement and
(iii) such exceptions that the Uniform Single Attestation Program for Mortgage
Bankers or the Audit Program for Mortgages Serviced by Xxxxxxx Mac requires it
to report. Copies of such statements shall be provided to any Certificateholder
upon request by the Master Servicer, or by the Trustee at the expense of the
Master Servicer if the Master Servicer shall fail to provide such copies but
only if the Master Servicer has provided the Trustee with such statement. If
such report discloses exceptions that are material, the Master Servicer shall
advise the Trustee whether such exceptions have been or are susceptible of cure,
and will take prompt action to do so.
Section 3.18 REPORTS FILED WITH SECURITIES AND EXCHANGE COMMISSION.
Within 15 days after each Distribution Date, the Securities
Administrator shall, in accordance with industry standards, file with the
Commission via the Electronic Data Gathering and Retrieval System ("XXXXX"), a
Form 8 K (or other comparable form containing the comparable information or
other information mutually agreed upon) with a copy of Certificate Distribution
Report for such Distribution Date as an exhibit thereto. Prior to January 30 in
any year, the Securities Administrator shall, in accordance with industry
standards and only if instructed by the Depositor, file a Form 15 Suspension
Notice with respect to the Trust Fund, if applicable. Prior to (i) March 15,
2006 and (ii) unless and until a Form 15 Suspension Notice shall have been
filed, prior to March 15 of each year thereafter, the Master Servicer shall
provide the Securities Administrator with a Master Servicer Certification,
together with a copy of the annual independent accountant's servicing report of
each Servicer and annual statement of compliance of each Servicer, in each case,
required to be delivered pursuant to the related Servicing Agreement, and, if
applicable, the annual independent accountant's servicing report and annual
statement of compliance to be delivered by the Master Servicer pursuant to
Sections 3.16 and 3.17. Prior to (i) March 31, 2006, or such earlier filing date
as may be required by the Commission, and (ii) unless and until a Form 15
Suspension Notice shall have been filed, March 31 of each year thereafter, or
such earlier filing date as may be required by the Commission, the Securities
Administrator shall file a Form 10-K, in substance conforming to industry
standards, with respect to the Trust Fund. Such Form 10-K shall include the
Master Servicer Certification and other documentation provided by the Master
Servicer pursuant to the second preceding sentence. The Depositor hereby grants
to the Securities Administrator a limited power of attorney to execute and file
each such document on behalf of the Depositor. Such power of attorney shall
continue until either the earlier of (i) receipt by the Securities Administrator
from the Depositor of written termination of such power of attorney and (ii) the
termination of the Trust Fund. The Depositor agrees to promptly furnish to the
Securities Administrator, from time to time upon request, such further
information, reports and financial statements within its control related to this
Agreement and the Mortgage Loans as the Securities Administrator reasonably
deems appropriate to prepare and file all necessary reports with the Commission.
The Securities Administrator shall have no responsibility to file any items
other than those specified in this Section 3.18; provided, however, the
Securities Administrator will cooperate with the Depositor in connection with
any additional filings with respect to the Trust Fund as the Depositor deems
necessary under the Securities Exchange Act of 1934, as amended (the "Exchange
Act"). Fees and expenses incurred by the Securities Administrator in connection
with this Section 3.18 shall not be reimbursable from the Trust Fund.
Section 3.19 [Reserved].
Section 3.20 UCC.
The Depositor shall inform the Trustee in writing of any Uniform
Commercial Code financing statements that were filed on the Closing Date in
connection with the Trust with stamped recorded copies of such financing
statements to be delivered to the Trustee promptly upon receipt by the
Depositor. If directed by the Depositor in writing, the Trustee will file any
continuation statements solely at the expense of the Depositor. The Depositor
shall file any financing statements or amendments thereto required by any change
in the Uniform Commercial Code.
Section 3.21 OPTIONAL PURCHASE OF DEFAULTED MORTGAGE LOANS.
(a) With respect to any Mortgage Loan which as of the first day of a
Fiscal Quarter is delinquent in payment by 90 days or more or is an REO
Property, the Company shall have the right to purchase such Mortgage Loan from
the Trust at a price equal to the Repurchase Price; provided however (i) that
such Mortgage Loan is still 90 days or more delinquent or is an REO Property as
of the date of such purchase and (ii) this purchase option, if not theretofore
exercised, shall terminate on the date prior to the last day of the related
Fiscal Quarter. This purchase option, if not exercised, shall not be thereafter
reinstated unless the delinquency is cured and the Mortgage Loan thereafter
again becomes 90 days or more delinquent or becomes an REO Property, in which
case the option shall again become exercisable as of the first day of the
related Fiscal Quarter.
(b) If at any time the Company remits to the Master Servicer a payment
for deposit in the Master Servicer Collection Account covering the amount of the
Repurchase Price for such a Mortgage Loan, and the Company provides to the
Trustee a certification signed by a Servicing Officer stating that the amount of
such payment has been deposited in the Master Servicer Collection Account, then
the Trustee shall execute the assignment of such Mortgage Loan to the Company at
the request of the Company without recourse, representation or warranty and the
Company shall succeed to all of the Trustee's right, title and interest in and
to such Mortgage Loan, and all security and documents relative thereto. Such
assignment shall be an assignment outright and not for security. The Company
will thereupon own such Mortgage, and all such security and documents, free of
any further obligation to the Trustee or the Certificateholders with respect
thereto.
ARTICLE IV
Accounts
Section 4.01 PROTECTED ACCOUNT.
(a) The Master Servicer shall enforce the obligation of each Servicer
to establish and maintain a Protected Account in accordance with the applicable
Servicing Agreement, with records to be kept with respect thereto on a Mortgage
Loan by Mortgage Loan basis, into which accounts shall be deposited within 48
hours (or as of such other time specified in the related Servicing Agreement) of
receipt, all collections of principal and interest on any Mortgage Loan and any
REO Property received by a Servicer, including Principal Prepayments, Insurance
Proceeds, Liquidation Proceeds, Subsequent Recoveries and advances made from the
Servicer's own funds (less servicing compensation as permitted by the applicable
Servicing Agreement in the case of any Servicer) and all other amounts to be
deposited in the Protected Account. The Servicer is hereby authorized to make
withdrawals from and deposits to the related Protected Account for purposes
required or permitted by this Agreement. To the extent provided in the related
Servicing Agreement, the Protected Account shall be held by a Designated
Depository Institution and segregated on the books of such institution in the
name of the Trustee for the benefit of Holders of the Certificates.
(b) To the extent provided in the related Servicing Agreement, amounts
on deposit in a Protected Account may be invested in Permitted Investments in
the name of the Trustee for the benefit of Holders of the Certificates and,
except as provided in the preceding paragraph, not commingled with any other
funds. Such Permitted Investments shall mature, or shall be subject to
redemption or withdrawal, no later than the date on which such funds are
required to be withdrawn for deposit in the Master Servicer Collection Account,
and shall be held until required for such deposit. The income earned from
Permitted Investments made pursuant to this Section 4.01 shall be paid to the
related Servicer under the applicable Servicing Agreement, and the risk of loss
of moneys required to be distributed to the Holders of the Certificates
resulting from such investments shall be borne by and be the risk of the related
Servicer. The related Servicer (to the extent provided in the Servicing
Agreement) shall deposit the amount of any such loss in the Protected Account
within two Business Days of receipt of notification of such loss but not later
than the second Business Day prior to the Distribution Date on which the moneys
so invested are required to be distributed to the Holders of the Certificates.
(c) To the extent provided in the related Servicing Agreement and
subject to this Article IV, on or before each Servicer Remittance Date, the
related Servicer shall withdraw or shall cause to be withdrawn from its
Protected Accounts and shall immediately deposit or cause to be deposited in the
Master Servicer Collection Account amounts representing the following
collections and payments (other than with respect to principal of or interest on
the Mortgage Loans due on or before the Cut-off Date):
(i) Scheduled Payments on the Mortgage Loans received or any
related portion thereof advanced by such Servicer pursuant to its Servicing
Agreement which were due on or before the related Due Date, net of the amount
thereof comprising its Servicing Fee or any fees with respect to any lender-paid
primary mortgage insurance policy;
(ii) Full Principal Prepayments and any Liquidation Proceeds
or Subsequent Recoveries received by such Servicer with respect to the Mortgage
Loans in the related Prepayment Period, with interest to the date of prepayment
or liquidation, net of the amount thereof comprising its Servicing Fee;
(iii) Partial Principal Prepayments received by such Servicer
for the Mortgage Loans in the related Prepayment Period; and
(iv) Any amount to be used as a Monthly Advance.
(d) Withdrawals may be made from an Account only to make remittances as
provided in Section 4.01(c), 4.02 and 4.03; to reimburse the Master Servicer or
a Servicer for Monthly Advances which have been recovered by subsequent
collections from the related Mortgagor; to remove amounts deposited in error; to
remove fees, charges or other such amounts deposited on a temporary basis; or to
clear and terminate the account at the termination of the Trust Fund in
accordance with Section 10.01. As provided in Sections 4.01(a) and 4.02(b)
certain amounts otherwise due to the Servicers may be retained by them and need
not be deposited in the Master Servicer Collection Account.
Section 4.02 MASTER SERVICER COLLECTION ACCOUNT.
(a) The Master Servicer shall establish and maintain in the name of the
Trustee, for the benefit of the Holders of the Certificates, the Master Servicer
Collection Account as a segregated trust account or accounts. The Master
Servicer Collection Account shall be an Eligible Account. The Master Servicer
will deposit in the Master Servicer Collection Account as identified by the
Master Servicer and as received by the Master Servicer, the following amounts:
(i) Any amounts withdrawn from a Protected Account;
(ii) Any Monthly Advance and any Compensating Interest
Payments;
(iii) Any Insurance Proceeds or Net Liquidation Proceeds or
Subsequent Recoveries received by or on behalf of the Master Servicer or which
were not deposited in a Protected Account;
(iv) The Repurchase Price with respect to any Mortgage Loans
purchased by the Seller pursuant to the Mortgage Loan Purchase Agreement or
Sections 2.02 or 2.03 hereof, any amounts which are to be treated pursuant to
Section 2.04 of this Agreement as the payment of a Repurchase Price in
connection with the tender of a Substitute Mortgage Loan by the Seller, the
Repurchase Price with respect to any Mortgage Loans purchased by the Company
pursuant to Section 3.21, and all proceeds of any Mortgage Loans or property
acquired with respect thereto repurchased by the Depositor or its designee
pursuant to Section 10.01;
(v) Any amounts required to be deposited with respect to
losses on investments of deposits in an Account; and
(vi) Any other amounts received by or on behalf of the Master
Servicer and required to be deposited in the Master Servicer Collection Account
pursuant to this Agreement.
(b) All amounts deposited to the Master Servicer Collection Account
shall be held by the Master Servicer in the name of the Trustee in trust for the
benefit of the Certificateholders in accordance with the terms and provisions of
this Agreement. The requirements for crediting the Master Servicer Collection
Account or the Distribution Account shall be exclusive, it being understood and
agreed that, without limiting the generality of the foregoing, payments in the
nature of (i) prepayment or late payment charges or assumption, tax service,
statement account or payoff, substitution, satisfaction, release and other like
fees and charges and (ii) the items enumerated in Subsections 4.05(a)(i), (ii),
(iii), (iv), (vi), (vii), (viii), (ix), (x), (xi) and (xii), need not be
credited by the Master Servicer or the related Servicer to the Distribution
Account or the Master Servicer Collection Account, as applicable. In the event
that the Master Servicer shall deposit or cause to be deposited to the
Distribution Account any amount not required to be credited thereto, the
Trustee, upon receipt of a written request therefor signed by a Servicing
Officer of the Master Servicer, shall promptly transfer such amount to the
Master Servicer, any provision herein to the contrary notwithstanding.
(c) The amount at any time credited to the Master Servicer Collection
Account may be invested, in the name of the Trustee, or its nominee, for the
benefit of the Holders of the Certificates, in Permitted Investments as directed
by Master Servicer. All Permitted Investments shall mature or be subject to
redemption or withdrawal on or before, and shall be held until, the next
succeeding Distribution Account Deposit Date. Any and all investment earnings on
amounts on deposit in the Master Servicer Account from time to time shall be for
the account of the Master Servicer. The Master Servicer from time to time shall
be permitted to withdraw or receive distribution of any and all investment
earnings from the Master Servicer Collection Account. The risk of loss of moneys
required to be distributed to the Holders of the Certificates resulting from
such investments shall be borne by and be the risk of the Master Servicer. The
Master Servicer shall deposit the amount of any such loss in the Master Servicer
Collection Account within two Business Days of receipt of notification of such
loss but not later than the second Business Day prior to the Distribution Date
on which the moneys so invested are required to be distributed to the
Certificateholders.
Section 4.03 PERMITTED WITHDRAWALS AND TRANSFERS FROM THE MASTER
SERVICER COLLECTION ACCOUNT.
(a) The Master Servicer will, from time to time on demand of a Servicer
or the Securities Administrator, make or cause to be made such withdrawals or
transfers from the Master Servicer Collection Account as the Master Servicer has
designated for such transfer or withdrawal pursuant to this Agreement and the
related Servicing Agreement. The Master Servicer may clear and terminate the
Master Servicer Collection Account pursuant to Section 10.01 and remove amounts
from time to time deposited in error.
(b) On an ongoing basis, the Master Servicer shall withdraw from the
Master Servicer Collection Account (i) any expenses, costs and liabilities
recoverable by the Trustee, the Master Servicer or the Securities Administrator
or the Custodian pursuant to Sections 3.03, 7.03 and 9.05 and (ii) any amounts
payable to the Master Servicer as set forth in Section 3.14; provided however,
that the Master Servicer shall be obligated to pay from its own funds any
amounts which it is required to pay under Section 7.03(a).
(c) In addition, on or before each Distribution Account Deposit Date,
the Master Servicer shall deposit in the Distribution Account (or remit to the
Trustee for deposit therein) any Monthly Advances required to be made by the
Master Servicer with respect to the Mortgage Loans.
(d) No later than 3:00 p.m. New York time on each Distribution Account
Deposit Date, the Master Servicer will transfer all Available Funds on deposit
in the Master Servicer Collection Account with respect to the related
Distribution Date to the Paying Agent for deposit in the Distribution Account.
Section 4.04 DISTRIBUTION ACCOUNT.
(a) The Paying Agent shall establish and maintain in the name of the
Paying Agent, for the benefit of the related Certificateholders, the
Distribution Account as a segregated trust account or accounts.
(b) All amounts deposited to the Distribution Account shall be held by
the Paying Agent in the name of the Paying Agent in trust for the benefit of the
related Certificateholders in accordance with the terms and provisions of this
Agreement.
(c) The Distribution Account shall constitute a trust account of the
Trust Fund segregated on the books of the Paying Agent and held by the Paying
Agent in trust in its Corporate Trust Office, and the Distribution Account and
the funds deposited therein shall not be subject to, and shall be protected
from, all claims, liens, and encumbrances of any creditors or depositors of the
Paying Agent or the Master Servicer (whether made directly, or indirectly
through a liquidator or receiver of the Paying Agent or the Master Servicer).
The Distribution Account shall be an Eligible Account. The amount at any time
credited to the Distribution Account shall be (i) held in cash and fully insured
by the FDIC to the maximum coverage provided thereby or (ii) invested in the
name of the Paying Agent, in such Permitted Investments as may be selected by
the Master Servicer or deposited in demand deposits with such depository
institutions as may be selected by the Master Servicer, provided that time
deposits of such depository institutions would be a Permitted Investment. All
Permitted Investments shall mature or be subject to redemption or withdrawal on
or before, and shall be held until, the next succeeding Distribution Date if the
obligor for such Permitted Investment is the Paying Agent or, if such obligor is
any other Person, the Business Day preceding such Distribution Date. All
investment earnings on amounts on deposit in the Distribution Account or benefit
from funds uninvested therein from time to time shall be for the account of the
Master Servicer. The Master Servicer shall be permitted to withdraw or receive
distribution of any and all investment earnings from the Distribution Account on
each Distribution Date. If there is any loss on a Permitted Investment or demand
deposit, the Master Servicer shall remit the amount of the loss to the Paying
Agent who shall deposit such amount in the Distribution Account. With respect to
the Distribution Account and the funds deposited therein, the Master Servicer
shall take such action as may be necessary to ensure that the related
Certificateholders shall be entitled to the priorities afforded to such a trust
account (in addition to a claim against the estate of the Paying Agent) as
provided by 12 U.S.C. ss. 92a(e), and applicable regulations pursuant thereto,
if applicable, or any applicable comparable state statute applicable to state
chartered banking corporations.
Section 4.05 PERMITTED WITHDRAWALS AND TRANSFERS FROM THE
DISTRIBUTION ACCOUNT.
(a) The Paying Agent will, from time to time on written demand of the
Master Servicer or the Securities Administrator, make or cause to be made such
withdrawals or transfers from the Distribution Account as the Master Servicer
has designated for such transfer or withdrawal pursuant to this Agreement and
the Servicing Agreements or as the Securities Administrator has instructed
hereunder for the following purposes (limited in the case of amounts due the
Master Servicer to those not withdrawn from the Master Servicer Collection
Account in accordance with the terms of this Agreement):
(i) to reimburse the Master Servicer or any Servicer for
any Monthly Advance of its own funds, the right of the Master Servicer or a
Servicer to reimbursement pursuant to this subclause (i) being limited to
amounts received on a particular Mortgage Loan (including, for this purpose,
the Repurchase Price therefor, Insurance Proceeds, Liquidation Proceeds and
Subsequent Recoveries) which represent late payments or recoveries of the
principal of or interest on such Mortgage Loan respecting which such Monthly
Advance was made;
(ii) to reimburse the Master Servicer or any Servicer from
Insurance Proceeds or Liquidation Proceeds relating to a particular Mortgage
Loan for amounts expended by the Master Servicer or such Servicer in good
faith in connection with the restoration of the related Mortgaged Property
which was damaged by an Uninsured Cause or in connection with the liquidation
of such Mortgage Loan;
(iii) to reimburse the Master Servicer or any Servicer from
Insurance Proceeds relating to a particular Mortgage Loan for insured
expenses incurred with respect to such Mortgage Loan and to reimburse the
Master Servicer or such Servicer from Liquidation Proceeds from a particular
Mortgage Loan for Liquidation Expenses incurred with respect to such Mortgage
Loan; provided that the Master Servicer shall not be entitled to
reimbursement for Liquidation Expenses with respect to a Mortgage Loan to the
extent that (i) any amounts with respect to such Mortgage Loan were paid as
Excess Liquidation Proceeds pursuant to clause (xi) of this Subsection 4.03
(a) to the Master Servicer; and (ii) such Liquidation Expenses were not
included in the computation of such Excess Liquidation Proceeds;
(iv) to reimburse the Master Servicer or any Servicer for
advances of funds (other than Monthly Advances) made with respect to the
Mortgage Loans, and the right to reimbursement pursuant to this subclause
being limited to amounts received on the related Mortgage Loan (including,
for this purpose, the Repurchase Price therefor, Insurance Proceeds,
Liquidation Proceeds and Subsequent Recoveries) which represent late
recoveries of the payments for which such advances were made;
(v) to reimburse the Master Servicer or any Servicer for
any Monthly Advance or advance, after a Realized Loss has been allocated with
respect to the related Mortgage Loan if the Monthly Advance or advance has
not been reimbursed pursuant to clauses (i) and (iv);
(vi) to pay the Master Servicer as set forth in Section
3.14;
(vii) to reimburse the Master Servicer for expenses, costs
and liabilities incurred by and reimbursable to it pursuant to Sections 3.03,
7.04(c) and (d);
(viii) to pay to the Master Servicer, as additional
servicing compensation, any Excess Liquidation Proceeds to the extent not
retained by the related Servicer;
(ix) to reimburse or pay any Servicer any such amounts as
are due thereto under the applicable Servicing Agreement and have not been
retained by or paid to the Servicer, to the extent provided in the related
Servicing Agreement;
(x) to reimburse the Trustee, the Securities Administrator
or the Custodian for expenses, costs and liabilities incurred by or
reimbursable to it pursuant to this Agreement and the Custodial Agreement;
(xi) to remove amounts deposited in error; and
(xii) to clear and terminate the Distribution Account
pursuant to Section 10.01.
(b) The Master Servicer shall keep and maintain separate accounting, on
a Mortgage Loan by Mortgage Loan basis, for the purpose of accounting for any
reimbursement from the Distribution Account pursuant to subclauses (i) through
(iv) or with respect to any such amounts which would have been covered by such
subclauses had the amounts not been retained by the Master Servicer without
being deposited in the Distribution Account under Section 4.02(b).
(c) On each Distribution Date, the Paying Agent shall distribute the
Available Funds to the extent on deposit in the Distribution Account to the
Holders of the Certificates in accordance with written distribution instructions
provided to it by the Securities Administrator no later than two Business Days
prior to such Distribution Date and determined by the Securities Administrator
in accordance with Section 6.01.
ARTICLE V
Certificates
Section 5.01 CERTIFICATES.
(a) The Depository, the Depositor and the Trustee have entered into a
Depository Agreement dated as of the Closing Date (the "Depository Agreement").
Except for the Residual Certificates, the Non-Offered Certificates (which are
also Physical Certificates) and the Individual Certificates and as provided in
Subsection 5.01(b), the Certificates shall at all times remain registered in the
name of the Depository or its nominee and at all times: (i) registration of such
Certificates may not be transferred by the Certificate Registrar except to a
successor to the Depository; (ii) ownership and transfers of registration of
such Certificates on the books of the Depository shall be governed by applicable
rules established by the Depository; (iii) the Depository may collect its usual
and customary fees, charges and expenses from its Depository Participants; (iv)
the Certificate Registrar shall deal with the Depository as representative of
such Certificate Owners of the respective Class of Certificates for purposes of
exercising the rights of the related Certificateholders under this Agreement,
and requests and directions for and votes of such representative shall not be
deemed to be inconsistent if they are made with respect to different Certificate
Owners; and (v) the Certificate Registrar may rely and shall be fully protected
in relying upon information furnished by the Depository with respect to its
Depository Participants.
The Residual Certificates and the Non-Offered Certificates are
initially Physical Certificates. If at any time the Holders of all of the
Certificates of one or more such Classes request that the Certificate Registrar
cause such Class to become Global Certificates, the Certificate Registrar and
the Depositor will take such action as may be reasonably required to cause the
Depository to accept such Class or Classes for trading if it may legally be so
traded.
All transfers by Certificate Owners of such respective Classes of
Book-Entry Certificates and any Global Certificates shall be made in accordance
with the procedures established by the Depository Participant or brokerage firm
representing such Certificate Owners. Each Depository Participant shall only
transfer Book-Entry Certificates of Certificate Owners it represents or of
brokerage firms for which it acts as agent in accordance with the Depository's
normal procedures.
(b) If (i)(A) the Depositor advises the Certificate Registrar in
writing that the Depository is no longer willing or able to properly discharge
its responsibilities as Depository and (B) the Depositor is unable to locate a
qualified successor within 30 days or (ii) the Depositor at its option advises
the Certificate Registrar in writing that it elects to terminate the book-entry
system through the Depository, the Certificate Registrar shall request that the
Depository notify all Certificate Owners of the occurrence of any such event and
of the availability of definitive, fully registered Certificates to Certificate
Owners requesting the same. Upon surrender to the Certificate Registrar of the
Certificates by the Depository, accompanied by registration instructions from
the Depository for registration, the Certificate Registrar shall issue the
definitive Certificates. Neither the Depositor nor the Certificate Registrar
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.
(c) (i) REMIC I will be evidenced by (x) the REMIC I Regular
Interests, which will be uncertificated and non-transferable and are hereby
designated as the "regular interests" in REMIC I and have the initial principal
amounts and accrue interest at the Pass-Through Rates equal to those set forth
in this Section 5.01(c)(i), and (y) the Class I-R-1 Certificates, which are
hereby designated as the sole class of "residual interests" in REMIC I (each of
the foregoing as designated below).
INITIAL PRINCIPAL
REMIC I INTEREST AMOUNT PASS-THROUGH RATE RELATED SUBGROUP
----------------------- ------------------------ ------------------------ ------------------------------------
1-Sub $ 628.60 4.7500% Subgroup I-1
2-Sub $ 659.13 5.0000% Subgroup I-2
3-Sub $ 647.09 5.2500% Subgroup I-3
PO $ 534,020.21 0.0000% Subgroup I-1
1-ZZZ $ 39,113,378.27 4.7500% Subgroup I-1
2-ZZZ $ 41,012,868.46 5.0000% Subgroup I-2
3-ZZZ $ 40,263,698.83 5.2500% Subgroup I-3
X (1) (2) Subgroup 1-3
Class I-R-1 $ 50.00 4.7500% Subgroup I-1
(1) REMIC I Regular Interest X will not have an initial principal
amount but will accrue interest on its uncertificated notional
amount calculated in accordance with the definition of
"Uncertificated Notional Amount" herein.
(2) A variable pass-through rate equal to the excess, if any, of
(a) the weighted average of the Net Mortgage Rates on the
Group I Mortgage Loans with Net Mortgage Rates greater than
5.2500% per annum over (b) 5.2500% per annum.
Interest shall be payable to the REMIC I Regular Interests at the
applicable Pass-Through Rates on the related Uncertificated Principal Balances.
Distributions of principal (including only, in the case of principal from
Subgroup I-1, any remaining amounts after distributions to the Class I-R-1
Certificates until the Current Principal Amount thereof has been reduced to
zero) shall be deemed to be made to the REMIC I Regular Interests, in each case
from the related Subgroup, first, to the related REMIC I Regular Interest ending
with the designation "Sub," so that the Uncertificated Principal Balance of each
such REMIC I Regular Interest is equal to 0.1% of the excess of (x) the
aggregate Scheduled Principal Balance of the Group I Mortgage Loans in the
related Subgroup other than the PO Percentage of the Scheduled Principal Balance
of any such Group I Mortgage Loans over (y) the aggregate Current Principal
Amount of the Group I Senior Certificates related to such Subgroup other than
the Class I-PO Certificates (except that if any such excess is a larger number
than in the preceding distribution period, the least amount of principal shall
be distributed to such REMIC I Regular Interests such that the REMIC I
Subordinated Balance Ratio is maintained); and second, to the related REMIC I
Regular Interest ending with the designation "ZZZ," (provided that a portion of
the remaining principal equal to the Class I-PO Certificate Principal
Distribution Amount attributable to the Discount Mortgage Loans will be
distributed to REMIC I Regular Interest PO). Realized Losses from each Subgroup
shall be applied after all distributions have been made on each Distribution
Date, first, to the related REMIC I Regular Interest ending with the designation
"Sub," so that the Uncertificated Principal Balance of each such REMIC I Regular
Interest is equal to 0.1% of the excess of (x) the aggregate Scheduled Principal
Balance of the Mortgage Loans in the related Subgroup other than the PO
Percentage of the Scheduled Principal Balance of any such Group I Mortgage Loans
over (y) the aggregate Current Principal Amount of the Group I Senior
Certificates related to such Subgroup other than the Class I-PO Certificates
(except that if any such excess is a larger number than in the preceding
distribution period, the least amount of Realized Losses shall be applied to
such REMIC I Regular Interests such that the REMIC I Subordinated Balance Ratio
is maintained); and second, any remaining Realized Losses from each Subgroup to
the related REMIC I Regular Interests ending with the designation "ZZZ" (and the
related Class I-R-1 Certificates to the extent provided in Section 6.01) (except
that if a Realized Loss is recognized with respect to a Discount Mortgage Loan,
the applicable portion of such Realized Loss will be allocated to REMIC I
Regular Interest PO).
The aggregate amount of any Net Interest Shortfalls for any
Distribution Date shall be allocated to accrued interest payable to the REMIC I
Interests other than REMIC I Regular Interest PO, PRO RATA, based on, and to the
extent of, one month's interest at the then applicable respective Pass-Through
Rates on the respective Uncertificated Principal Balances or Current Principal
Amount of each such REMIC I Interest.
(ii) REMIC II will be evidenced by (x) the REMIC II Regular Interests,
which will be uncertificated and non-transferable and are hereby designated as
the "regular interests" in REMIC II and have the initial principal amounts and
accrue interest at the Pass-Through Rates equal to those set forth in this
Section 5.01(c)(ii), and (y) the Class II-R-1 Certificates, which are hereby
designated as the sole class of "residual interests" in REMIC II (each of the
foregoing as designated below).
REMIC II INTEREST INITIAL PRINCIPAL AMOUNT PASS-THROUGH RATE RELATED LOAN GROUP
----------------------- ----------------------------- ---------------------- ---------------------------------
II-A-1 $ 115,987,649.00 (1) Loan Group II
II-X (2) 0.0700% Loan Group II
Class II-R-1 $ 100.00 (1) Loan Group II
II-B-1 $ 1,836,217.00 (1) Loan Group II
II-B-2 $ 1,407,766.00 (1) Loan Group II
II-B-3 $ 1,101,730.00 (1) Loan Group II
II-B-4 $ 612,072.00 (1) Loan Group II
II-B-5 $ 306,036.00 (1) Loan Group II
II-B-6 $ 1,162,941.42 (1) Loan Group II
(1) A variable pass-through rate equal to the weighted average of
the Net Mortgage Rates of the Group II Mortgage Loans,
weighted on the basis of the respective Scheduled Principal
Balance of each such Mortgage Loan as of the beginning of the
Due Period immediately preceding the related Distribution
Date, minus 0.0700% per annum.
(2) REMIC II Regular Interest II-X will not have an initial
principal amount but will accrue interest on its
uncertificated notional amount calculated in accordance with
the definition of "Uncertificated Notional Amount" herein.
Interest shall be payable to the REMIC II Regular Interests at the
applicable Pass-Through Rates on the related Uncertificated Principal Balances.
Principal shall be payable to, and shortfalls, losses and prepayments are
allocable to, the REMIC II Regular Interests as such amounts are payable and
allocable to the Corresponding Certificates; provided that, solely for purposes
of the foregoing, any shortfalls or losses otherwise allocable to the Class
II-XB Certificates shall be deemed to be allocated entirely to the Class II-B-1,
Class II-B-2 and Class II-B-3 Certificates on a pro rata basis..
(iii) REMIC III will be evidenced by (x) the REMIC III Regular Certificates,
which are hereby designated as the "regular interests" in REMIC III and have the
initial principal amounts and accrue interest at the Pass-Through Rates equal to
those set forth in this section 5.01(c)(iii), and (y) the Class I-R-2
Certificates, which are hereby designated as the sole class of "residual
interests" in REMIC III (each of the foregoing as designated below). The Classes
of the Certificates shall have the following designations, initial principal
amounts and Pass-Through Rates:
DESIGNATION INITIAL PRINCIPAL AMOUNT PASS-THROUGH RATE
---------------------------------- ---------------------------------------- -----------------------------------
I-A-1 $ 38,485,356.00 4.7500%
I-A-2 $ 40,354,400.00 5.0000%
I-A-3 $ 39,617,258.00 5.2500%
I-PO $ 534,020.21 0.0000%
I-X (1) (2)
I-R-1 $ 50.00 4.7500%
I-R-2 $ 50.00 4.7500%
I-B-1 $ 725,555.00 (3)
I-B-2 $ 544,166.00 (3)
I-B-3 $ 241,851.00 (3)
I-B-4 $ 120,925.00 (3)
I-B-5 $ 120,925.00 (3)
I-B-6 $ 181,394.38 (3)
II-A-1 $ 115,987,649.00 (4)
II-X (1) 0.0700%
II-R-1 $ 100.00 (4)
II-B-1 $ 1,836,217.00 (5)
II-B-2 $ 1,407,766.00 (5)
II-B-3 $ 1,101,730.00 (5)
II-XB (1) 1.7430%
II-B-4 $ 612,072.00 (4)
II-B-5 $ 306,036.00 (4)
II-B-6 $ 1,162,941.42 (4)
(1) As described in the definition of Notional Amount herein.
(2) A variable pass-through rate equal to the excess, if any, of
(a) the weighted average of the Net Mortgage Rates on the
Group I Mortgage Loans with Net Mortgage Rates greater than
5.2500% per annum over (b) 5.2500% per annum; provided that,
for federal income tax purposes the Class I-X Certificates
will not have a Pass-Through Rate but will be entitled to
receive 100% of the interest payable with respect to REMIC I
Regular Interest X.
(3) A variable pass-through rate equal to the weighted average of
4.7500%, 5.0000% and 5.2500% per annum, weighted in proportion
to the results of subtracting from the aggregate Scheduled
Principal Balance of the Group I Mortgage Loans in Subgroup
I-1, Subgroup I-2 and Subgroup I-3, respectively (other than
the PO Percentage of the principal balance of such Group I
Mortgage Loans), the aggregate Current Principal Amount of the
related Class or Classes of Group I Senior Certificates other
than the Class I-PO Certificates; provided that, for federal
income tax purposes, the Class I-B Certificates will bear
interest at a rate equivalent to the foregoing, expressed as
the weighted average of the Pass-Through Rates on REMIC I
Regular Interests 1-Sub, 2-Sub and 3-Sub, weighted on the
basis of the Uncertificated Principal Balances of each such
REMIC I Regular Interest immediately preceding the related
Distribution Date.
(4) A variable pass-through rate equal to the weighted average of
the Net Mortgage Rates of the Group II Mortgage Loans,
weighted on the basis of the respective Scheduled Principal
Balance of each such Mortgage Loan as of the beginning of the
Due Period immediately preceding the related Distribution
Date, minus 0.0700% per annum; provided that, for federal
income tax purposes the Class II-A-1, Class II-B-4, Class
II-B-5 and Class II-B-6 Certificates will bear interest at a
rate equivalent to the foregoing, expressed as the weighted
average of the Pass-Through Rates on REMIC II Regular
Interests II-A-1, II-B-4, II-B-5 and II-B-6, weighted on the
basis of the Uncertificated Principal Balances of each such
REMIC II Regular Interest immediately preceding the related
Distribution Date, minus 0.0700% per annum.
(5) A variable pass-through rate equal to the weighted average of
the Net Mortgage Rates of the Group II Mortgage Loans,
weighted on the basis of the respective Scheduled Principal
Balance of each such Mortgage Loan as of the beginning of the
Due Period immediately preceding the related Distribution
Date, minus 1.8130% per annum; provided that, for federal
income tax purposes the Class II-B-1, Class II-B-2 and Class
II-B-3 Certificates will bear interest at a rate equivalent to
the foregoing, expressed as the weighted average of the
Pass-Through Rates on REMIC II Regular Interests II-B-1,
II-B-2 and II-B-3, weighted on the basis of the Uncertificated
Principal Balances of each such REMIC II Regular Interest
immediately preceding the related Distribution Date, minus
1.7430%.
(d) For purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
regulations, the Distribution Date immediately following the
maturity date for the Group I Mortgage Loan or Group II
Mortgage Loan, as applicable, with the latest maturity date in
the Trust Fund has been designated as the "latest possible
maturity date" for the REMIC I Regular Interests, REMIC II
Regular Interests and the REMIC III Regular Certificates, in
each case related to such Loan Group.
(e) With respect to each Distribution Date, each Class of
Certificates shall accrue interest during the related Interest
Accrual Period. With respect to each Distribution Date and
each such Class of Certificates, interest shall be calculated
on the basis of a 360-day year comprised of twelve 30-day
months, based upon the respective Pass-Through Rate set forth,
or determined as provided, above and the Current Principal
Amount (or Notional Amount in the case of the Interest Only
Certificates) of such Class applicable to such Distribution
Date.
(f) The Certificates shall be substantially in the forms set forth
in Exhibits X-0, X-0, X-0, X-0, X-0 or A-6, as applicable. On
original issuance, the Certificate Registrar shall sign,
countersign and shall deliver them at the direction of the
Depositor. Pending the preparation of Definitive Certificates
of any Class, the Certificate Registrar may sign and
countersign temporary Certificates that are printed,
lithographed or typewritten, in authorized denominations for
Certificates of such Class, substantially of the tenor of the
Definitive Certificates in lieu of which they are issued and
with such appropriate insertions, omissions, substitutions and
other variations as the officers or authorized signatories
executing such Certificates may determine, as evidenced by
their execution of such Certificates. If temporary
Certificates are issued, the Depositor will cause Definitive
Certificates to be prepared without unreasonable delay. After
the preparation of Definitive Certificates, the temporary
Certificates shall be exchangeable for definitive Certificates
upon surrender of the temporary Certificates at the office of
the Certificate Registrar, without charge to the Holder. Upon
surrender for cancellation of any one or more temporary
Certificates, the Certificate Registrar shall sign and
countersign and deliver in exchange therefor a like aggregate
principal amount, in authorized denominations for such Class,
of Definitive Certificates of the same Class. Until so
exchanged, such temporary Certificates shall in all respects
be entitled to the same benefits as Definitive Certificates.
(g) Each Class of Book-Entry Certificates will be registered as a
single Certificate of such Class held by a nominee of the
Depository or the DTC Custodian, and beneficial interests will
be held by investors through the book-entry facilities of the
Depository in minimum denominations of (i) in the case of the
Senior Certificates (other than the Residual Certificates),
$1,000 and in each case increments of $1.00 in excess thereof,
and (ii) in the case of the Subordinate Certificates, $25,000
and increments of $1.00 in excess thereof, except that one
Certificate of each such Class may be issued in a different
amount so that the sum of the denominations of all outstanding
Certificates of such Class shall equal the Current Principal
Amount of such Class on the Closing Date. On the Closing Date,
the Certificate Registrar shall execute and countersign
Physical Certificates all in an aggregate principal amount
that shall equal the Current Principal Amount of such Class on
the Closing Date. The Non-Offered Certificates shall be issued
in certificated fully-registered form in minimum dollar
denominations of $25,000 and integral multiples of $1.00 in
excess thereof, except that one of each of the Non-Offered
Certificates of each Class may be issued in a different amount
so that the sum of the denominations of all outstanding
related Non-Offered Certificates of such Class shall equal the
Current Principal Amount of such Class on the Closing Date.
The Class I-R-1 Certificates and Class I-R-2 Certificates
shall each be issued in certificated fully-registered form, in
the denomination of $50. The Class II-R-1 Certificates shall
each be issued in certificated fully-registered form, in the
denomination of $100. Each Class of Global Certificates, if
any, shall be issued in fully registered form in minimum
dollar denominations of $50,000 and integral multiples of
$1.00 in excess thereof, except that one Certificate of each
Class may be in a different denomination so that the sum of
the denominations of all outstanding Certificates of such
Class shall equal the Current Principal Amount of such Class
on the Closing Date. On the Closing Date, the Certificate
Registrar shall execute and countersign (i) in the case of
each Class of the Offered Certificates, the Certificate in the
entire Current Principal Amount of the respective Class and
(ii) in the case of each Class of the Non-Offered
Certificates, Individual Certificates all in an aggregate
principal amount that shall equal the Current Principal Amount
of each such respective Class on the Closing Date. The
Certificates referred to in clauses (i) and (ii) and if at any
time there are to be Global Certificates, the Global
Certificates shall be delivered by the Depositor to the
Depository or pursuant to the Depository's instructions, shall
be delivered by the Depositor on behalf of the Depository to
and deposited with the DTC Custodian. The Certificate
Registrar shall sign the Certificates by facsimile or manual
signature and countersign them by manual signature on behalf
of the Certificate Registrar by one or more authorized
signatories, each of whom shall be Responsible Officers of the
Certificate Registrar or its agent. A Certificate bearing the
manual and facsimile signatures of individuals who were the
authorized signatories of the Certificate Registrar or its
agent at the time of issuance shall bind the Certificate
Registrar, notwithstanding that such individuals or any of
them have ceased to hold such positions prior to the delivery
of such Certificate.
(h) No Certificate shall be entitled to any benefit under this
Agreement, or be valid for any purpose, unless there appears
on such Certificate the manually executed countersignature of
the Certificate Registrar or its agent, and such
countersignature upon any Certificate shall be conclusive
evidence, and the only evidence, that such Certificate has
been duly executed and delivered hereunder. All Certificates
issued on the Closing Date shall be dated the Closing Date.
All Certificates issued thereafter shall be dated the date of
their countersignature.
(i) The Closing Date is hereby designated as the "startup" day of
each REMIC within the meaning of Section 860G(a)(9) of the
Code.
(j) For federal income tax purposes, each REMIC shall have a tax
year that is a calendar year and shall report income on an
accrual basis.
(k) The Trustee on behalf of the Trust shall cause each REMIC to
timely elect to be treated as a REMIC under Section 860D of
the Code. Any inconsistencies or ambiguities in this Agreement
or in the administration of any Trust established hereby shall
be resolved in a manner that preserves the validity of such
elections.
(l) The following legend shall be placed on the Residual
Certificates, whether upon original issuance or upon issuance
of any other Certificate of any such Class in exchange
therefor or upon transfer thereof:
THIS CERTIFICATE MAY NOT BE ACQUIRED DIRECTLY OR INDIRECTLY
BY, OR ON BEHALF OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT WHICH IS SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED, OR SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED, UNLESS THE PROPOSED
TRANSFEREE PROVIDES THE CERTIFICATE REGISTRAR WITH AN OPINION OF
COUNSEL ADDRESSED TO THE DEPOSITOR, TRUSTEE, CERTIFICATE REGISTRAR,
MASTER SERVICER AND SECURITIES ADMINISTRATOR AND ON WHICH THEY MAY RELY
THAT IS SATISFACTORY TO THE TRUSTEE THAT THE PURCHASE OF CERTIFICATES
ON BEHALF OF SUCH PERSON WILL NOT RESULT IN OR CONSTITUTE A NONEXEMPT
PROHIBITED TRANSACTION, IS PERMISSIBLE UNDER APPLICABLE LAW AND WILL
NOT GIVE RISE TO ANY ADDITIONAL OBLIGATIONS ON THE PART OF THE
DEPOSITOR, CERTIFICATE REGISTRAR, THE MASTER SERVICER, THE SECURITIES
ADMINISTRATOR, CERTIFICATE REGISTRAR OR THE TRUSTEE.
The following legend shall be placed upon the Class I-B-4, Class I-B-5 and Class
I-B-6 Certificates, whether upon original issuance or upon issuance of any other
Certificate of any such Class in exchange therefor or upon transfer thereof:
THIS CERTIFICATE MAY NOT BE ACQUIRED DIRECTLY OR INDIRECTLY BY, OR ON
BEHALF OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT WHICH IS
SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED, OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED,
UNLESS THE TRANSFEREE CERTIFIES OR REPRESENTS THAT THE PROPOSED TRANSFER AND
HOLDING OF A CERTIFICATE AND THE SERVICING, MANAGEMENT AND OPERATION OF THE
TRUST AND ITS ASSETS: (I) WILL NOT RESULT IN ANY PROHIBITED TRANSACTION WHICH IS
NOT COVERED UNDER AN INDIVIDUAL OR CLASS PROHIBITED TRANSACTION EXEMPTION,
INCLUDING, BUT NOT LIMITED TO, PROHIBITED TRANSACTION EXEMPTION ("PTE") 84-14,
XXX 00-00, XXX 00-0, XXX 95-60 OR PTE 96-23 AND (II) WILL NOT GIVE RISE TO ANY
ADDITIONAL OBLIGATIONS ON THE PART OF THE DEPOSITOR, THE SECURITIES
ADMINISTRATOR, THE MASTER SERVICER, CERTIFICATE REGISTRAR OR THE TRUSTEE, WHICH
WILL BE DEEMED REPRESENTED BY AN OWNER OF A BOOK-ENTRY CERTIFICATE OR A GLOBAL
CERTIFICATE OR UNLESS THE OPINION SPECIFIED IN SECTION 5.07 OF THE AGREEMENT IS
PROVIDED.
Section 5.02 REGISTRATION OF TRANSFER AND EXCHANGE OF CERTIFICATES.
(a) The Certificate Registrar shall maintain at its Corporate Trust
Office a separate Certificate Register for Certificates in which, subject to
such reasonable regulations as it may prescribe, the Certificate Registrar shall
provide for the registration of the related Certificates and of transfers and
exchanges of the related Certificates as herein provided.
(b) Subject to Subsection 5.01(a) and, in the case of any Global
Certificate or Physical Certificate upon the satisfaction of the conditions set
forth below, upon surrender for registration of transfer of any Certificate at
any office or agency of the Certificate Registrar maintained for such purpose,
the Certificate Registrar shall sign, countersign and shall deliver, in the name
of the designated transferee or transferees, a new Certificate of a like Class
and aggregate Fractional Undivided Interest, but bearing a different number.
(c) By acceptance of an Individual Certificate, whether upon original
issuance or subsequent transfer, each holder of such a Certificate acknowledges
the restrictions on the transfer of such Certificate set forth in the Securities
Legend and agrees that it will transfer such a Certificate only as provided
herein. In addition to the provisions of Subsection 5.02(h), the following
restrictions shall apply with respect to the transfer and registration of
transfer of an Individual Certificate to a transferee that takes delivery in the
form of an Individual Certificate:
(i) The Certificate Registrar shall register the transfer of
an Individual Certificate if the requested transfer is being made to a
transferee who has provided the Certificate Registrar with a Rule 144A
Certificate or comparable evidence as to its QIB status.
(ii) The Certificate Registrar shall register the transfer of
any Individual Certificate if (x) the transferor has advised the Certificate
Registrar in writing that the Certificate is being transferred to an
Institutional Accredited Investor; and (y) prior to the transfer the transferee
furnishes to the Certificate Registrar an Investment Letter (and the Certificate
Registrar shall be fully protected in so doing), provided that, if based upon an
Opinion of Counsel addressed to the Certificate Registrar to the effect that the
delivery of (x) and (y) above are not sufficient to confirm that the proposed
transfer is being made pursuant to an exemption from, or in a transaction not
subject to, the registration requirements of the Securities Act and other
applicable laws, the Certificate Registrar shall as a condition of the
registration of any such transfer require the transferor to furnish such other
certifications, legal opinions or other information prior to registering the
transfer of an Individual Certificate as shall be set forth in such Opinion of
Counsel.
(d) Subject to Subsection 5.02(h), so long as a Global Certificate of
such Class is outstanding and is held by or on behalf of the Depository,
transfers of beneficial interests in such Global Certificate, or transfers by
holders of Individual Certificates of such Class to transferees that take
delivery in the form of beneficial interests in the Global Certificate, may be
made only in accordance with this Subsection 5.02(d) and in accordance with the
rules of the Depository:
(i) In the case of a beneficial interest in the Global
Certificate being transferred to an Institutional Accredited Investor, such
transferee shall be required to take delivery in the form of an Individual
Certificate or Certificates and the Certificate Registrar shall register such
transfer only upon compliance with the provisions of Subsection 5.02(c)(ii).
(ii) In the case of a beneficial interest in a Class of Global
Certificates being transferred to a transferee that takes delivery in the form
of an Individual Certificate or Certificates of such Class, except as set forth
in clause (i) above, the Certificate Registrar shall register such transfer only
upon compliance with the provisions of Subsection 5.02(c)(i).
(iii) In the case of an Individual Certificate of a Class
being transferred to a transferee that takes delivery in the form of a
beneficial interest in a Global Certificate of such Class, the Certificate
Registrar shall register such transfer if the transferee has provided the
Certificate Registrar with a Rule 144A Certificate or comparable evidence as to
its QIB status.
(iv) No restrictions shall apply with respect to the transfer
or registration of transfer of a beneficial interest in the Global Certificate
of a Class to a transferee that takes delivery in the form of a beneficial
interest in the Global Certificate of such Class; provided that each such
transferee shall be deemed to have made such representations and warranties
contained in the Rule 144A Certificate as are sufficient to establish that it is
a QIB.
(e) Subject to Subsection 5.02(h), an exchange of a beneficial interest
in a Global Certificate of a Class for an Individual Certificate or Certificates
of such Class, an exchange of an Individual Certificate or Certificates of a
Class for a beneficial interest in the Global Certificate of such Class and an
exchange of an Individual Certificate or Certificates of a Class for another
Individual Certificate or Certificates of such Class (in each case, whether or
not such exchange is made in anticipation of subsequent transfer, and, in the
case of the Global Certificate of such Class, so long as such Certificate is
outstanding and is held by or on behalf of the Depository) may be made only in
accordance with this Subsection 5.02(e) and in accordance with the rules of the
Depository:
(i) A holder of a beneficial interest in a Global Certificate
of a Class may at any time exchange such beneficial interest for an Individual
Certificate or Certificates of such Class.
(ii) A holder of an Individual Certificate or Certificates of
a Class may exchange such Certificate or Certificates for a beneficial interest
in the Global Certificate of such Class if such holder furnishes to the
Certificate Registrar a Rule 144A Certificate or comparable evidence as to its
QIB status.
(iii) A holder of an Individual Certificate of a Class may
exchange such Certificate for an equal aggregate principal amount of Individual
Certificates of such Class in different authorized denominations without any
certification.
(f) (i) Upon acceptance for exchange or transfer of an Individual
Certificate of a Class for a beneficial interest in a Global Certificate of such
Class as provided herein, the Certificate Registrar shall cancel such Individual
Certificate and shall (or shall request the Depository to) endorse on the
schedule affixed to the applicable Global Certificate (or on a continuation of
such schedule affixed to the Global Certificate and made a part thereof) or
otherwise make in its books and records an appropriate notation evidencing the
date of such exchange or transfer and an increase in the certificate balance of
the Global Certificate equal to the certificate balance of such Individual
Certificate exchanged or transferred therefor.
(ii) Upon acceptance for exchange or transfer of a beneficial
interest in a Global Certificate of a Class for an Individual Certificate of
such Class as provided herein, the Certificate Registrar shall (or shall request
the Depository to) endorse on the schedule affixed to such Global Certificate
(or on a continuation of such schedule affixed to such Global Certificate and
made a part thereof) or otherwise make in its books and records an appropriate
notation evidencing the date of such exchange or transfer and a decrease in the
certificate balance of such Global Certificate equal to the certificate balance
of such Individual Certificate issued in exchange therefor or upon transfer
thereof.
(g) The Securities Legend shall be placed on any Individual Certificate
issued in exchange for or upon transfer of another Individual Certificate or of
a beneficial interest in a Global Certificate.
(h) Subject to the restrictions on transfer and exchange set forth in
this Section 5.02, the holder of any Individual Certificate may transfer or
exchange the same in whole or in part (in an initial certificate balance equal
to the minimum authorized denomination set forth in Section 5.01(g) above or any
integral multiple of $1.00 in excess thereof) by surrendering such Certificate
at the Corporate Trust Office, or at the office of any transfer agent, together
with an executed instrument of assignment and transfer satisfactory in form and
substance to the Certificate Registrar in the case of transfer and a written
request for exchange in the case of exchange. The holder of a beneficial
interest in a Global Certificate may, subject to the rules and procedures of the
Depository, cause the Depository (or its nominee) to notify the Certificate
Registrar in writing of a request for transfer or exchange of such beneficial
interest for an Individual Certificate or Certificates. Following a proper
request for transfer or exchange, the Certificate Registrar shall, within five
Business Days of such request made at the Corporate Trust Office, sign,
countersign and deliver at the Corporate Trust Office, to the transferee (in the
case of transfer) or holder (in the case of exchange) or send by first class
mail at the risk of the transferee (in the case of transfer) or holder (in the
case of exchange) to such address as the transferee or holder, as applicable,
may request, an Individual Certificate or Certificates, as the case may require,
for a like aggregate Fractional Undivided Interest and in such authorized
denomination or denominations as may be requested. The presentation for transfer
or exchange of any Individual Certificate shall not be valid unless made at the
Corporate Trust Office by the registered holder in person, or by a duly
authorized attorney-in-fact.
(i) At the option of the Certificateholders, Certificates may be
exchanged for other Certificates of authorized denominations of a like Class and
aggregate Fractional Undivided Interest, upon surrender of the Certificates to
be exchanged at the Corporate Trust Office; provided, however, that no
Certificate may be exchanged for new Certificates unless the original Fractional
Undivided Interest represented by each such new Certificate (i) is at least
equal to the minimum authorized denomination or (ii) is acceptable to the
Depositor as indicated to the Certificate Registrar in writing. Whenever any
Certificates are so surrendered for exchange, the Certificate Registrar shall
sign and countersign and the Certificate Registrar shall deliver the
Certificates which the Certificateholder making the exchange is entitled to
receive.
(j) If the Certificate Registrar so requires, every Certificate
presented or surrendered for transfer or exchange shall be duly endorsed by, or
be accompanied by a written instrument of transfer, with a signature guarantee,
in form satisfactory to the Certificate Registrar, duly executed by the holder
thereof or his or her attorney duly authorized in writing.
(k) No service charge shall be made for any transfer or exchange of
Certificates, but the Certificate Registrar may require payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
(l) The Certificate Registrar shall cancel all Certificates surrendered
for transfer or exchange but shall retain such Certificates in accordance with
its standard retention policy or for such further time as is required by the
record retention requirements of the Securities Exchange Act of 1934, as
amended, and thereafter may destroy such Certificates.
Section 5.03. MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES.
(a) If (i) any mutilated Certificate is surrendered to the Certificate
Registrar, or the Certificate Registrar receives evidence to its satisfaction of
the destruction, loss or theft of any Certificate, and (ii) there is delivered
to the Certificate Registrar such security or indemnity as it may require to
save it harmless, and (iii) the Certificate Registrar has not received notice
that such Certificate has been acquired by a third Person, the Certificate
Registrar shall sign, countersign and deliver, in exchange for or in lieu of any
such mutilated, destroyed, lost or stolen Certificate, a new Certificate of like
tenor and Fractional Undivided Interest but in each case bearing a different
number. The mutilated, destroyed, lost or stolen Certificate shall thereupon be
canceled of record by the Certificate Registrar and shall be of no further
effect and evidence no rights.
(b) Upon the issuance of any new Certificate under this Section 5.03,
the Certificate Registrar may require the payment of a sum sufficient to cover
any tax or other governmental charge that may be imposed in relation thereto and
any other expenses (including the fees and expenses of the Certificate
Registrar) connected therewith. Any duplicate Certificate issued pursuant to
this Section 5.03 shall constitute complete and indefeasible evidence of
ownership in the Trust Fund, as if originally issued, whether or not the lost,
stolen or destroyed Certificate shall be found at any time.
Section 5.04 PERSONS DEEMED OWNERS.
Prior to due presentation of a Certificate for registration of
transfer, the Depositor, the Paying Agent, the Certificate Registrar or the
Trustee and any agent of the Depositor, the Paying Agent, the Certificate
Registrar or the Trustee may treat the Person in whose name any Certificate is
registered as the owner of such Certificate for the purpose of receiving
distributions pursuant to Section 6.01 and for all other purposes whatsoever.
None of the Depositor, the Paying Agent, the Certificate Registrar or the
Trustee or any agent of the Depositor, the Paying Agent, the Certificate
Registrar or the Trustee shall be affected by notice to the contrary. No
Certificate shall be deemed duly presented for a transfer effective on any
Record Date unless the Certificate to be transferred is presented no later than
the close of business on the third Business Day preceding such Record Date.
Section 5.05 TRANSFER RESTRICTIONS ON RESIDUAL CERTIFICATES.
(a) Residual Certificates, or interests therein, may not be transferred
without the prior express written consent of the Tax Matters Person and the
Depositor. As a prerequisite to such consent, the proposed transferee must
provide the Tax Matters Person, the Depositor, the Certificate Registrar and the
Trustee with an affidavit that the proposed transferee is a Permitted Transferee
(and an affidavit that it is a United States Person) as provided in Subsection
5.05(b).
(b) No transfer, sale or other disposition of a Residual Certificate
(including a beneficial interest therein) may be made unless, prior to the
transfer, sale or other disposition of a Residual Certificate, the proposed
transferee (including the initial purchasers thereof) delivers to the Tax
Matters Person, the Trustee, the Certificate Registrar and the Depositor an
affidavit in the form attached hereto as Exhibit E stating, among other things,
that as of the date of such transfer (i) such transferee is a Permitted
Transferee and that (ii) such transferee is not acquiring such Residual
Certificate for the account of any Person who is not a Permitted Transferee. The
Tax Matters Person shall not consent to a transfer of a Residual Certificate if
it has actual knowledge that any statement made in the affidavit issued pursuant
to the preceding sentence is not true. Notwithstanding any transfer, sale or
other disposition of a Residual Certificate to any Person who is not a Permitted
Transferee or a United States Person, such transfer, sale or other disposition
shall be deemed to be of no legal force or effect whatsoever and such Person
shall not be deemed to be a Holder of a Residual Certificate for any purpose
hereunder, including, but not limited to, the receipt of distributions thereon.
If any purported transfer shall be in violation of the provisions of this
Subsection 5.05(b), then the prior Holder thereof shall, upon discovery that the
transfer of such Residual Certificate was not in fact permitted by this
Subsection 5.05(b), be restored to all rights and obligations as a Holder
thereof retroactive to the date of the purported transfer. None of the Trustee,
the Certificate Registrar, the Tax Matters Person or the Depositor shall be
under any liability to any Person for any registration or transfer of a Residual
Certificate that is not permitted by this Subsection 5.05(b) or for making
payments due on such Residual Certificate to the purported Holder thereof or
taking any other action with respect to such purported Holder under the
provisions of this Agreement so long as the written affidavit referred to above
was received with respect to such transfer, and the Tax Matters Person, the
Trustee, the Certificate Registrar and the Depositor, as applicable, had no
knowledge that it was untrue. The prior Holder shall be entitled to recover from
any purported Holder of a Residual Certificate that was in fact not a Permitted
Transferee or a United States Person under this Subsection 5.05(b) at the time
it became a Holder all payments made on such Residual Certificate. Each Holder
of a Residual Certificate, by acceptance thereof, shall be deemed for all
purposes to have consented to the provisions of this Subsection 5.05(b) and to
any amendment of this Agreement deemed necessary (whether as a result of new
legislation or otherwise) by counsel of the Tax Matters Person or the Depositor
to ensure that the Residual Certificates are not transferred to any Person who
is not a Permitted Transferee or a United States Person and that any transfer of
such Residual Certificates will not cause the imposition of a tax upon the Trust
or cause any REMIC to fail to qualify as a REMIC.
(c) The Residual Certificates (including a beneficial interest therein)
may not be purchased by or transferred to any Person who is not a United States
Person.
(d) By accepting a Residual Certificate, the purchaser thereof agrees
to be a Tax Matters Person, and appoints the Securities Administrator to act as
its agent with respect to all matters concerning the tax obligations of the
Trust.
Section 5.06 RESTRICTIONS ON TRANSFERABILITY OF NON-OFFERED
CERTIFICATES.
(a) No offer, sale, transfer or other disposition (including pledge) of
any Non-Offered Certificate shall be made by any Holder thereof unless
registered under the Securities Act, or an exemption from the registration
requirements of the Securities Act and any applicable state securities or "Blue
Sky" laws is available and the prospective transferee (other than the Depositor)
of such Certificate signs and delivers to the Certificate Registrar an
Investment Letter, if the transferee is an Institutional Accredited Investor, in
the form set forth as Exhibit F-l hereto, or a Rule 144A Certificate, if the
transferee is a QIB, in the form set forth as Exhibit F-2 hereto.
Notwithstanding the provisions of the immediately preceding sentence, no
restrictions shall apply with respect to the transfer or registration of
transfer of a beneficial interest in any Non-Offered Certificate that is a
Global Certificate of a Class to a transferee that takes delivery in the form of
a beneficial interest in the Global Certificate of such Class provided that each
such transferee shall be deemed to have made such representations and warranties
contained in the Rule 144A Certificate as are sufficient to establish that it is
a QIB. In the case of a proposed transfer of any Certificate to a transferee
other than a QIB, the Certificate Registrar may require an Opinion of Counsel
addressed to the Certificate Registrar that such transaction is exempt from the
registration requirements of the Securities Act. The cost of such opinion shall
not be an expense of the Certificate Registrar or the Trust Fund.
(b) The Non-Offered Certificates shall each bear a Securities Legend.
Section 5.07 ERISA RESTRICTIONS.
(a) Subject to the provisions of subsection (b), no Residual
Certificates or Non-Offered Certificates may be acquired directly or indirectly
by, or on behalf of, an employee benefit plan or other retirement arrangement
which is subject to Title I of ERISA or Section 4975 of the Code, unless the
proposed transferee provides either (i) the Certificate Registrar, with an
Opinion of Counsel addressed to the Depositor, the Trustee, the Certificate
Registrar, the Master Servicer and the Securities Administrator (upon which they
may rely) which is satisfactory to the Certificate Registrar, which opinion will
not be at the expense of the Depositor, the Trustee, the Certificate Registrar,
the Master Servicer or the Securities Administrator, that the purchase of such
Certificates by or on behalf of such Plan is permissible under applicable law,
will not constitute or result in a nonexempt prohibited transaction under ERISA
or Section 4975 of the Code and will not subject the Depositor, the Master
Servicer, the Certificate Registrar, the Securities Administrator or the Trustee
to any obligation in addition to those undertaken in the Agreement or (ii) in
the case of the Non-Offered Certificates, a representation or certification to
the Certificate Registrar (upon which the Trustee, the Certificate Registrar and
the other parties hereto are authorized to rely) to the effect that the proposed
transfer and holding of such a Certificate and the servicing, management and
operation of the Trust: (I) will not result in a prohibited transaction under
Section 406 of ERISA or Section 4975 of the Code which is not covered under an
individual or class prohibited transaction exemption including but not limited
to Department of Labor Prohibited Transaction Exemption ("PTE") 84-14 (Class
Exemption for Plan Asset Transactions Determined by Independent Qualified
Professional Asset Managers); PTE 91-38 (Class Exemption for Certain
Transactions Involving Bank Collective Investment Funds); PTE 90-1 (Class
Exemption for Certain Transactions Involving Insurance Company Pooled Separate
Accounts), PTE 95-60 (Class Exemption for Certain Transactions Involving
Insurance Company General Accounts), and PTCE 96-23 (Class Exemption for Plan
Asset Transactions Determined by In-House Asset Managers and (II) will not
subject the Depositor, the Securities Administrator, the Certificate Registrar,
the Master Servicer or the Trustee to any obligation in addition to those
undertaken in the Agreement.
(b) Any Person acquiring an interest in a Global Certificate which is a
Non-Offered Certificate, by acquisition of such Certificate, shall be deemed to
have represented to the Certificate Registrar that in the case of the
Non-Offered Certificates, either: (i) it is not acquiring an interest in such
Certificate directly or indirectly by, or on behalf of, an employee benefit plan
or other retirement arrangement which is subject to Title I of ERISA or Section
4975 of the Code, or (ii) the transfer and holding of an interest in such
Certificate to that Person and the subsequent servicing, management and
operation of the Trust and its assets: (I) will not result in any prohibited
transaction which is not covered under an individual or class prohibited
transaction exemption, including, but not limited to, XXX 00-00, XXX 00-00, XXX
00-0, XXX 95-60 or PTE 96-23 and (II) will not subject the Depositor, the
Securities Administrator, the Certificate Registrar, the Master Servicer or the
Trustee to any obligation in addition to those undertaken in the Agreement.
(c) Each beneficial owner of a Class I-B-1, Class I-B-2 or Class I-B-3
Certificate or any interest therein shall be deemed to have represented, by
virtue of its acquisition or holding of that certificate or interest therein,
that either (i) it is not a Plan or investing with "Plan Assets", (ii) it has
acquired and is holding such certificate in reliance on Prohibited Transaction
Exemption 90-30, as amended from time to time (the "Exemption"), and that it
understands that there are certain conditions to the availability of the
Exemption, including that the certificate must be rated, at the time of
purchase, not lower than "BBB-" (or its equivalent) by S&P, Fitch Ratings or
Xxxxx'x Investors Service, Inc., and the certificate is so rated or (iii) (1) it
is an insurance company, (2) the source of funds used to acquire or hold the
certificate or interest therein is an "insurance company general account," as
such term is defined in Prohibited Transaction Class Exemption ("PTCE") 95-60,
and (3) the conditions in Sections I and III of PTCE 95-60 have been satisfied.
(d) Neither the Trustee, the Certificate Registrar, the Master Servicer
nor the Securities Administrator will be required to monitor, determine or
inquire as to compliance with the transfer restrictions in this Agreement with
respect to the Book-Entry Certificates. Any attempted or purported transfer of
any Certificate in violation of the provisions of this Agreement shall be void
ab initio and such Certificate shall be considered to have been held
continuously by the prior permitted Certificateholder. Any transferor of any
Certificate in violation of such provisions, shall indemnify and hold harmless
the Trustee, the Certificate Registrar, the Securities Administrator and the
Master Servicer from and against any and all liabilities, claims, costs or
expenses incurred by the Trustee, the Certificate Registrar, the Securities
Administrator or the Master Servicer as a result of such attempted or purported
transfer. Neither the Trustee nor the Certificate Registrar shall be liable for
transfer of any such Book-Entry Certificates in or through book-entry facilities
of any Depository or between or among Depository Participants or Certificate
Owners made in violation of the transfer restrictions set forth herein.
Section 5.08 RULE 144A INFORMATION.
For so long as any Non-Offered Certificates are outstanding and are
"restricted securities" within the meaning of Rule 144(a)(3) of the Securities
Act, (1) the Depositor will provide or cause to be provided to any holder of
such Non-Offered Certificates and any prospective purchaser thereof designated
by such a holder, upon the request of such holder or prospective purchaser, the
information required to be provided to such holder or prospective purchaser by
Rule 144A(d)(4) under the Securities Act; and (2) the Depositor shall update
such information from time to time in order to prevent such information from
becoming false and misleading and will take such other actions as are necessary
to ensure that the safe harbor exemption from the registration requirements of
the Securities Act under Rule 144A is and will be available for resales of such
Certificates conducted in accordance with Rule 144A.
Section 5.09 APPOINTMENT OF PAYING AGENT AND CERTIFICATE REGISTRAR.
Xxxxx Fargo Bank, National Association, as Securities Administrator,
shall act as the initial Paying Agent and Certificate Registrar for so long as
it is also the Master Servicer. Each of the Paying Agent and the Certificate
Registrar may resign upon thirty (30) days' prior written notice to the Trustee;
provided that no such resignation shall be effective until the appointment of a
successor paying agent or certificate registrar. In the event the Paying Agent
and/or the Certificate Registrar resigns or is removed by the Trustee for cause,
the Trustee may appoint a successor paying agent or certificate registrar, as
applicable. The Trustee shall cause such successor paying agent, if other than
the Trustee or the Master Servicer or the Securities Administrator, to execute
and deliver to the Trustee an instrument in which such paying agent shall agree
with the Trustee that such paying agent will hold all sums held by it for the
payment to Certificateholders in trust for the benefit of the Certificateholders
entitled thereto until such sums have been paid to the Certificateholders.
ARTICLE VI
Payments to Certificateholders
Section 6.01 DISTRIBUTIONS ON THE CERTIFICATES.
(a) Interest and principal (as applicable) on the Certificates will be
distributed by the Paying Agent monthly on each Distribution Date based on the
Certificates Distribution Report for such Distribution Date furnished by the
Securities Administrator pursuant to 6.05 hereof, commencing in July 2005, in an
amount equal to the related Available Funds on deposit in the Distribution
Account for such Distribution Date. On each Distribution Date, the related
Available Funds on deposit in the Distribution Account shall be distributed as
follows:
GROUP I CERTIFICATES:
On each Distribution Date, the Group I Available Funds will be
distributed as follows:
(i) on each Distribution Date, the Group I Available Funds will be
distributed to the Group I Senior Certificates as follows:
FIRST, to the Group I Senior Certificates (other than the
Class I-PO Certificates), on a pro rata basis, the Accrued Certificate
Interest on such Classes for such Distribution Date;
SECOND, to the Group I Senior Certificates (other than the
Class I-PO Certificates), on a pro rata basis, any Accrued Certificate
Interest thereon remaining undistributed from previous Distribution
Dates, to the extent of remaining Group I Available Funds;
THIRD, concurrently as follows:
(I) to the extent of the remaining Group I
Available Funds related to Subgroup I-1, to
the Class I-A-1, Class I-R-1 and Class I-R-2
Certificates, on a pro rata basis, as
principal, the Subgroup I-1 Principal
Distribution Amount, in the order described
in this Agreement, in reduction of the
Current Principal Amount thereof, until the
Current Principal Amount thereof has been
reduced to zero;
(II) to the extent of the remaining Group I
Available Funds related to Subgroup I-2, to
the Class I-A-2 Certificates, as principal,
the Subgroup I-2 Principal Distribution
Amount, in the order described in this
Agreement, in reduction of the Current
Principal Amount thereof, until the Current
Principal Amount thereof has been reduced to
zero; and
(III) to the extent of the remaining Group I
Available Funds related to Subgroup I-3, to
the Class I-A-3 Certificates, as principal,
the Subgroup I-3 Principal Distribution
Amount, in the order described in this
Agreement, in reduction of the Current
Principal Amount thereof, until the Current
Principal Amount thereof has been reduced to
zero;
FOURTH, to the Class I-PO Certificates, the Class I-PO
Certificate Principal Distribution Amount for such Distribution Date to
the extent of the remaining Group I Available Funds, until the Current
Principal Amount thereof has been reduced to zero; and
FIFTH, to the Class I-PO Certificates, the Class I-PO
Certificate Deferred Amount, provided that (i) on any Distribution
Date, distributions pursuant to this priority FIFTH shall not exceed
the excess, if any, of (x) Group I Available Funds remaining after
giving effect to distributions pursuant to priority FIRST through
FOURTH above over (y) the sum of the amount of Accrued Certificate
Interest for such Distribution Date and Accrued Certificate Interest
remaining undistributed from previous Distribution Dates on all Classes
of Group I Subordinate Certificates then outstanding, (ii) such
distributions shall not reduce the Current Principal Amount of the
Class I-PO Certificates, and (iii) no distribution will be made in
respect of the Class I-PO Certificate Deferred Amount on or after the
Group I Cross-Over Date.
(ii) On each Distribution Date on or prior to the Group I Cross-Over
Date, an amount equal to the remaining Group I Available Funds after the
distributions in clause (i) above shall be distributed sequentially in the
following order, to the Class I-B-1, Class I-B-2, Class I-B-3, Class I-B-4,
Class I-B-5 and Class I-B-6 Certificates, in each case up to an amount equal to
and in the following order: (a) the Accrued Certificate Interest thereon for
such Distribution Date, (b) any Accrued Certificate Interest thereon remaining
undistributed from previous Distribution Dates and (c) such Class's Group I
Allocable Share for such Distribution Date, in each case, to the extent of the
remaining Group I Available Funds.
(iii) If, after distributions have been made pursuant to priorities
FIRST and SECOND of clause (i) above on any Distribution Date, the remaining
Group I Available Funds related to Subgroup I-1 is less than the sum of the
Subgroup I-1 Principal Distribution Amount and Class PO Principal Distribution
Amount, or the remaining Group I Available Funds related to Subgroup I-2 is less
than the Subgroup I-2 Principal Distribution Amount, or the remaining Group I
Available Funds related to Subgroup I-3 is less than the Subgroup I-3 Principal
Distribution Amount, such amounts shall be reduced, and such remaining funds
will be distributed to the related Group I Senior Certificates (other than the
Class I-X Certificates) on the basis of such reduced amounts. Notwithstanding
any reduction in principal distributable to the Class I-PO Certificates pursuant
to this paragraph, the principal balance of the Class I-PO Certificates shall be
reduced not only by principal so distributed but also by the difference between
(i) principal distributable to the Class I-PO Certificates in accordance with
priority FIFTH of clause (A) above, and (ii) principal actually distributed to
the Class I-PO Certificates after giving effect to this paragraph (such
difference for the Class I-PO Certificates, the "Class I-PO Certificate Cash
Shortfall"). The Class I-PO Certificate Cash Shortfall for the Class I-PO
Certificates with respect to any Distribution Date will be added to the Class
I-PO Certificate Deferred Amount.
(iv) On each Distribution Date, any Group I Available Funds remaining
after payment of interest and principal to the Classes of Certificates entitled
thereto, in each case as described above, will be distributed to the Class I-R
Certificates on a pro rata basis; provided, that if on any Distribution Date
there are any Group I Available Funds remaining after payment of interest and
principal to a Class or Classes of Certificates entitled thereto, such amounts
will be distributed to the other Class or Classes of Group I Senior
Certificates, pro rata, based upon their Current Principal Amounts, until all
amounts due to all Classes of Group I Senior Certificates have been paid in
full, before any amounts are distributed to the Class I-R Certificates.
GROUP II CERTIFICATES:
On each Distribution Date, the Group II Available Funds will be
distributed as follows:
(i) on each Distribution Date, the Group II Available Funds
will be distributed to the Group II Senior Certificates as follows:
FIRST, to the Group II Senior Certificates, on a pro rata
basis, the Accrued Certificate Interest on such Classes for such
Distribution Date;
SECOND, to the Group II Senior Certificates, on a pro rata
basis, any Accrued Certificate Interest thereon remaining undistributed
from previous Distribution Dates, to the extent of remaining Group II
Available Funds;
THIRD, to the Group II Senior Certificates, on a pro rata
basis, as principal, the Group II Senior Optimal Principal Amount for
such Distribution Date to the extent of the remaining Group II
Available Funds until the Current Principal Amount of each such Class
has been reduced to zero.
(ii) On each Distribution Date on or prior to the Group II Cross-Over
Date, an amount equal to the remaining Group II Available Funds after the
distributions in clause (A) above will be distributed sequentially in the
following order, to the Class II-XB, Class II-B-1, Class II-B-2, Class II-B-3,
Class II-B-4, Class II-B-5 and Class II-B-6 Certificates, in each case up to an
amount equal to and in the following order: (a) the Accrued Certificate Interest
thereon for such Distribution Date, (b) any Accrued Certificate Interest thereon
remaining undistributed from previous Distribution Dates and (c) such Class's
(other than the Class II-XB Certificates) Group II Allocable Share for such
Distribution Date, in each case, to the extent of the remaining Group II
Available Funds.
(iii) If, after distributions have been made pursuant to priorities
FIRST and SECOND of clause (i) above on any Distribution Date, the remaining
Group II Available Funds are less than the Group II Senior Optimal Principal
Amount, such amount shall be reduced, and such remaining funds will be
distributed to the Group II Senior Certificates, on the basis of such reduced
amount.
(iv) On each Distribution Date, any Group II Available Funds remaining
after payment of interest and principal to the Classes of Certificates entitled
thereto, in each case as described above, will be distributed to the Class
II-R-1 Certificates; provided, that if on any Distribution Date there are any
Group II Available Funds remaining after payment of interest and principal to a
Class or Classes of Certificates entitled thereto, such amounts will be
distributed to the other Class or Classes of Group II Senior Certificates, pro
rata, based upon their Current Principal Amounts, until all amounts due to all
Classes of Group II Senior Certificates have been paid in full, before any
amounts are distributed to the Class II-R-1 Certificates.
(b) "Pro rata" distributions among Classes of Certificates will be made
in proportion to the then Current Principal Amount of such Classes.
(c) No Accrued Certificate Interest will be payable with respect to any
Class of Certificates after the Distribution Date on which the Current Principal
Amount or Notional Amount of such Certificate has been reduced to zero.
(d) If on any Distribution Date the Available Funds for the related
Senior Certificates is less than the Accrued Certificate Interest on the related
Senior Certificates for such Distribution Date prior to reduction for Net
Interest Shortfalls and the interest portion of Realized Losses, the shortfall
will be allocated among the Holders of each Class of the related Senior
Certificates (other than the Class I-PO Certificates) in proportion to the
respective amounts of Accrued Certificate Interest that would have been
allocated thereto in the absence of such Net Interest Shortfalls and/or Realized
Losses for such Distribution Date. In addition, the amount of any interest
shortfalls will constitute unpaid Accrued Certificate Interest and will be
distributable to Holders of the Certificates of the related Classes entitled to
such amounts on subsequent Distribution Dates, to the extent of the applicable
Available Funds after current interest distributions as required herein. Any
such amounts so carried forward will not bear interest. Shortfalls in interest
payments will not be offset by a reduction in the servicing compensation of the
Master Servicer or otherwise, except to the extent of applicable Compensating
Interest Payments.
(e) The expenses and fees of the Trust shall be paid by each of the
REMICs, to the extent that such expenses relate to the assets of each of such
respective REMICs, and all other expenses and fees of the Trust shall be paid
pro rata by each of the REMICs.
(f) (i) On each Distribution Date, an amount, up to the amount of the
Subgroup I-1 Principal Distribution Amount for that Distribution Date, will be
distributed as principal as follows:
(1) to the Class I-R-1 Certificates and Class I-R-2 Certificates,
pro rata, in reduction of the Current Principal Amount
thereof, until the Current Principal Amount thereof has been
reduced to zero; and
(2) to the Class I-A-1 Certificates, in reduction of the Current
Principal Amount thereof, until the Current Principal Amount
thereof has been reduced to zero.
(ii) On each Distribution Date, an amount, up to the amount of
the Subgroup I-2 Principal Distribution Amount for that Distribution Date, will
be distributed as principal, to the Class I-A-2 Certificates, in reduction of
the Current Principal Amount thereof, until the Current Principal Amount thereof
has been reduced to zero;
(iii) On each Distribution Date, an amount, up to the amount
of the Subgroup I-3 Principal Distribution Amount for that Distribution Date,
will be distributed as principal, to the Class I-A-3 Certificates, in reduction
of the Current Principal Amount thereof, until the Current Principal Amount
thereof has been reduced to zero;
(g) Distributions in reduction of the Current Principal Amount of the
Group II Senior Certificates shall be made on each Distribution Date pursuant to
priority THIRD above of clause (i). In accordance with such priority THIRD, the
Group II Available Funds remaining after the distribution of interest on the
Group II Senior Certificates will be allocated to such Certificates in an
aggregate amount not to exceed the Group II Senior Optimal Principal Amount for
the Group II Senior Certificates for such Distribution Date.
(h) In addition, in the event that the Master Servicer receives any
Subsequent Recoveries from a Servicer, the Master Servicer shall deposit such
funds into the Master Servicer Collection Account pursuant to Section 4.02. If,
after taking into account such Subsequent Recoveries, the amount of a Realized
Loss is reduced, the amount of such Subsequent Recoveries will be applied to
increase the Current Principal Amount of the related Class of Subordinate
Certificates with the highest payment priority to which Realized Losses have
been allocated, but not by more than the amount of Realized Losses previously
allocated to that Class of Subordinate Certificates pursuant to Section 6.03.
The amount of any remaining Subsequent Recoveries will be applied to
sequentially increase the Current Principal Amount of the related Subordinate
Certificates, beginning with the Class of such Subordinate Certificates with the
next highest payment priority, up to the amount of such Realized Losses
previously allocated to such Class of Certificates pursuant to Section 6.03.
Holders of such Certificates will not be entitled to any payment in respect of
current interest on the amount of such increases for any Interest Accrual Period
preceding the Distribution Date on which such increase occurs. Any such
increases shall be applied to the Current Principal Amount of each Subordinate
Certificate of such Class in accordance with its respective Fractional Undivided
Interest.
Section 6.02 [Reserved.]
Section 6.03 ALLOCATION OF LOSSES.
On or prior to each Determination Date, the Master Servicer shall
determine the amount of any Realized Loss in respect of each Mortgage Loan that
occurred during the immediately preceding calendar month, based on information
provided by the related Servicer.
(a) GROUP I CERTIFICATES
(i) Realized Losses with respect to a Group I Mortgage Loan
will be allocated on a pro rata basis between the PO Percentage of the Scheduled
Principal Balance of such Group I Mortgage Loan and the Non-PO Percentage of
such Scheduled Principal Balance.
(ii) On each Distribution Date, the PO Percentage of the
principal portion of any Realized Loss on a Discount Mortgage Loan and any Class
I-PO Certificate Cash Shortfall will be allocated to the Class I-PO Certificates
until the Current Principal Amount of the Class I-PO Certificates is reduced to
zero. With respect to any Distribution Date through the Group I Cross-Over Date,
the aggregate of all amounts so allocable to the Class I-PO Certificates on such
date in respect of any Realized Losses and any Class I-PO Certificate Cash
Shortfalls and all amounts previously allocated in respect of such Realized
Losses or Class I-PO Certificate Cash Shortfalls and not distributed on prior
Distribution Dates will be the "Class I-PO Certificate Deferred Amount." To the
extent funds are available therefor on any Distribution Date through the Group I
Cross-Over Date, distributions in respect of the Class I-PO Certificate Deferred
Amount for the Class I-PO Certificates will be made in accordance with priority
FIFTH of clause (i) above. No interest shall accrue on the Class I-PO
Certificate Deferred Amount. On each Distribution Date through the Group I
Cross-Over Date, the Current Principal Amount of the lowest ranking Class of
Group I Subordinate Certificates then outstanding will be reduced by the amount
of any distributions in respect of any Class I-PO Certificate Deferred Amount on
such Distribution Date in accordance with the priorities set forth above,
through the operation of the Group I Subordinate Certificate Writedown Amount.
After the Group I Cross-Over Date, no more distributions will be made in respect
of, and applicable Realized Losses and Class I-PO Certificate Cash Shortfalls
allocable to the Class I-PO Certificates will not be added to, the Class I-PO
Certificate Deferred Amount.
(iii) The Non-PO Percentage of the principal portion of
Realized Losses on the Group I Mortgage Loans will be allocated on any
Distribution Date as follows: first, to the Class I-B-6 Certificates; second, to
the Class I-B-5 Certificates; third, to the Class I-B-4 Certificates; fourth, to
the Class I-B-3 Certificates; fifth, to the Class I-B-2 Certificates; and sixth,
to the Class I-B-1 Certificates, in each case until the Current Principal Amount
of such Class has been reduced to zero. The applicable Non-PO Percentage of the
principal portion of any Excess Loss with respect to Group I Mortgage Loans for
any Distribution Date will be allocated pro rata among all outstanding Classes
of Group I Certificates (other than the Class I-PO Certificates and the Class
I-X Certificates) based on their Current Principal Amounts. Thereafter, the
principal portion of Realized Losses on the Group I Mortgage Loans will be
allocated on any Distribution Date to the outstanding Class or Classes of Group
I Senior Certificates (other than the Class I-X Certificates), pro rata, based
upon their respective Current Principal Amounts.
(iv) Notwithstanding the foregoing, no such allocation of any
Realized Loss shall be made on a Distribution Date to any Class of Group I
Certificates to the extent that such allocation would result in the reduction of
the aggregate Current Principal Amounts of all the Group I Certificates as of
such Distribution Date, after giving effect to all distributions and prior
allocations of Realized Losses on the Group I Mortgage Loans on such date, to an
amount less than the aggregate Scheduled Principal Balance of all of the Group I
Mortgage Loans as of the first day of the month of such Distribution Date (such
limitation, the "Group I Loss Allocation Limit").
(b) GROUP II CERTIFICATES
(i) The principal portion of Realized Losses on the Group II
Mortgage Loans shall be allocated on any Distribution Date as follows: first, to
the Class II-B-6 Certificates; second, to the Class II-B-5 Certificates; third,
to the Class II-B-4 Certificates; fourth, to the Class II-B-3 Certificates;
fifth, to the Class II-B-2 Certificates; and sixth, to the Class II-B-1
Certificates, in each case until the Current Principal Amount of such Class has
been reduced to zero. The principal portion of any Excess Loss with respect to
Group II Mortgage Loans for any Distribution Date will be allocated pro rata
among all outstanding Classes of Group II Certificates (other than the Class
II-XB Certificates) based on their Current Principal Amounts. Thereafter, the
principal portion of Realized Losses on the Group II Mortgage Loans will be
allocated on any Distribution Date to the outstanding Class or Classes of Group
II Senior Certificates (other than the Class II-X Certificates), pro rata, based
upon their respective Current Principal Amounts.
(ii) No reduction of the Current Principal Amount of any Class
of a Group II Senior Certificate (other than the Class II-X Certificates) shall
be made on any Distribution Date on account of Realized Losses to the extent
that such reduction would have the effect of reducing the aggregate Current
Principal Amount of all of the Classes of such Group II Senior Certificates as
of such Distribution Date to an amount less than the Scheduled Principal
Balances of the Group II Mortgage Loans as of the related Due Date. This
limitation is referred to herein as the "Group II Loss Allocation Limit."
(c) Any Realized Losses allocated to a Class of Certificates shall be
allocated among the related Certificates of such Class (other than the Interest
Only Certificates) in proportion to their respective Current Principal Amounts.
Any allocation of Realized Losses shall be accomplished by reducing the Current
Principal Amount of the related Certificates on the related Distribution Date.
(d) Realized Losses shall be allocated on the Distribution Date in the
month following the month in which such loss was incurred and, in the case of
the principal portion thereof, after giving effect to distributions made on such
Distribution Date.
(e) On each Distribution Date, the Securities Administrator shall
determine and notify the Paying Agent in writing of the Group I Subordinate
Certificate Writedown Amount. Any Group I Subordinate Certificate Writedown
Amount shall effect a corresponding reduction in the Current Principal Amount of
(i) if prior to the Group I Cross-Over Date, the Current Principal Amounts of
the Group I Subordinate Certificates, in the reverse order of their numerical
Class designations and (ii) from and after the Group I Cross-Over Date, the
Group I Senior Certificates, in accordance with priorities set forth in clause
(b) above, which reduction shall occur on such Distribution Date after giving
effect to distributions made on such Distribution Date.
(f) Any Net Interest Shortfall will be allocated among the Classes of
Certificates in proportion to the respective amounts of Accrued Certificate
Interest that would have been allocated thereto in the absence of such Net
Interest Shortfall for such Distribution Date. The interest portion of any
Realized Losses with respect to the Mortgage Loans occurring on or prior to the
related Cross-Over Date will not be allocated among any related Certificates,
but will reduce the amount of Available Funds on the related Distribution Date.
As a result of the subordination of the Subordinate Certificates in right of
distribution, such Realized Losses on the related Mortgage Loans will be borne
by the related Subordinate Certificates, in inverse order of their numerical
Class designations. Following the Cross-Over Date, the interest portion of
Realized Losses on the Mortgage Loans will be allocated to the related Senior
Certificates to the extent not covered, with respect to the Class I-A-3
Certificates, by the Reserve Fund.
(g) Any Deficient Valuation will on each Distribution Date be allocated
solely to the Subordinate Certificates until the Bankruptcy Coverage Termination
Date. The Bankruptcy Loss Amount and the related coverage levels may be reduced
or modified upon written confirmation from the related Rating Agencies that such
reduction or modification will not adversely affect the then current ratings of
the Senior Certificates by the related Rating Agencies (determined without
regard to the Policy). Such reduction may adversely affect the coverage provided
by subordination with respect to Bankruptcy Losses. Any Fraud Loss will on each
Distribution Date be allocated solely to the Subordinate Certificates until the
Fraud Coverage Termination Date. Any Special Hazard Loss will on each
Distribution Date be allocated solely to the outstanding Subordinate
Certificates until the Special Hazard Termination Date.
Section 6.04 PAYMENTS.
(a) On each Distribution Date, other than the final Distribution Date,
the Paying Agent shall distribute to each Certificateholder of record as of the
immediately preceding Record Date the Certificateholder's pro rata share of its
Class (based on the aggregate Fractional Undivided Interest represented by such
Holder's Certificates) of all amounts required to be distributed on such
Distribution Date to such Class, based on written information provided to the
Paying Agent by the Securities Administrator. The Securities Administrator shall
calculate the amount to be distributed to each Class and, based on such amounts,
the Securities Administrator shall determine the amount to be distributed to
each Certificateholder. All of the Securities Administrator's calculations of
payments shall be based solely on information provided to the Securities
Administrator by the Master Servicer. Neither the Securities Administrator nor
the Paying Agent shall be required to confirm, verify or recompute any such
information but shall be entitled to rely conclusively on such information.
(b) Payment of the above amounts to each Certificateholder shall be
made (i) by check mailed to each Certificateholder entitled thereto at the
address appearing in the Certificate Register or (ii) upon receipt by the Paying
Agent on or before the fifth Business Day preceding the Record Date of written
instructions from a Certificateholder by wire transfer to a United States dollar
account maintained by the payee at any United States depository institution with
appropriate facilities for receiving such a wire transfer; provided, however,
that the final payment in respect of each Class of Certificates will be made
only upon presentation and surrender of such respective Certificates at the
office or agency of the Paying Agent specified in the notice to
Certificateholders of such final payment.
Section 6.05 STATEMENTS TO CERTIFICATEHOLDERS.
(a) Concurrently with each distribution to Holders of the Certificates,
the Securities Administrator shall make available to the parties hereto, each
Rating Agency and each such Holder via the Securities Administrator's internet
website as set forth below, a Certificates Distribution Report containing the
following information with respect to the Certificates and the Mortgage Loans,
expressed with respect to clauses (i) through (vii) in the aggregate and as a
Fractional Undivided Interest representing an initial Current Principal Amount
of $1,000, or in the case of the Class I-R-1, Class I-R-2 and Class II-R-1
Certificates, an initial Current Principal Amount of $50, $50 and $100,
respectively:
(i) the Current Principal Amount (or Notional Amount) of each
Class of Certificates immediately prior to such Distribution Date;
(ii) the amount of the distribution allocable to principal on
each applicable Class of Certificates;
(iii) the aggregate amount of interest accrued at the related
Pass-Through Rate with respect to each Class during the related Interest Accrual
Period;
(iv) the Net Interest Shortfall and any other adjustments to
interest at the related Pass-Through Rate necessary to account for any
difference between interest accrued and aggregate interest distributed with
respect to each Class of Certificates;
(v) the amount of the distribution allocable to interest on
each Class of Certificates;
(vi) the Pass-Through Rates for each Class of Certificates
with respect to such Distribution Date;
(vii) the Current Principal Amount (or Notional Amount) of
each Class of Certificates after such Distribution Date;
(viii) the amount of any Monthly Advances, Compensating
Interest Payments and outstanding unreimbursed advances by the Master Servicer
or the Servicers included in such distribution;
(ix) the aggregate amount of any Realized Losses (listed
separately for each category of Realized Loss) during the related Prepayment
Period and cumulatively since the Cut-off Date and the amount and source
(separately identified) of any distribution in respect thereof included in such
distribution;
(x) with respect to each Mortgage Loan which incurred a
Realized Loss during the related Prepayment Period, (i) the loan number, (ii)
the Scheduled Principal Balance of such Mortgage Loan as of the Cut-off Date,
(ii) the Scheduled Principal Balance of such Mortgage Loan as of the beginning
of the related Due Period, (iii) the Net Liquidation Proceeds with respect to
such Mortgage Loan and (iv) the amount of the Realized Loss with respect to such
Mortgage Loan;
(xi) the amount of Scheduled Principal and Principal
Prepayments, (including but separately identifying the principal amount of
Principal Prepayments, Insurance Proceeds, the purchase price in connection with
the purchase of Mortgage Loans, cash deposits in connection with substitutions
of Mortgage Loans and Net Liquidation Proceeds) and the number and principal
balance of Mortgage Loans purchased or substituted for during the relevant
period and cumulatively since the Cut-off Date;
(xii) the number of Mortgage Loans (excluding REO Property)
remaining in the Trust Fund as of the end of the related Prepayment Period;
(xiii) information regarding any Mortgage Loan delinquencies
as of the end of the related Prepayment Period, including the aggregate number
and aggregate Outstanding Principal Balance of Mortgage Loans (a) delinquent 30
to 59 days on a contractual basis, (b) delinquent 60 to 89 days on a contractual
basis, and (c) delinquent 90 or more days on a contractual basis, in each case
as of the close of business on the last Business Day of the immediately
preceding month;
(xiv) the number of Mortgage Loans in the foreclosure process
as of the end of the related Due Period and the aggregate Outstanding Principal
Balance of such Mortgage Loans;
(xv) the number and aggregate Outstanding Principal Balance of
all Mortgage Loans as to which the Mortgaged Property was REO Property as of the
end of the related Due Period;
(xvi) the book value (the sum of (A) the Outstanding Principal
Balance of the Mortgage Loan, (B) accrued interest through the date of
foreclosure and (C) foreclosure expenses) of any REO Property; provided that, in
the event that such information is not available to the Securities Administrator
on the Distribution Date, such information shall be furnished promptly after it
becomes available; (xvii) the amount of Realized Losses allocated to each Class
of Certificates since the prior Distribution Date and in the aggregate for all
prior Distribution Dates; and
(xviii) the Average Loss Severity Percentage;
(xix) the amount of Special Hazard Losses, Fraud Losses,
Bankruptcy Losses and Extraordinary Losses on such Distribution Date and in the
aggregate for all prior Distribution Dates; and
(xx) the then applicable Subgroup Senior Percentage, Subgroup
Senior Prepayment Percentage, Subordinate Percentage and Subordinate Prepayment
Percentage for each Subgroup.
The information set forth above shall be calculated or reported, as the
case may be, by the Securities Administrator, based solely on, and to the extent
of, information provided to the Securities Administrator by the Master Servicer.
The Securities Administrator may conclusively rely on such information and shall
not be required to confirm, verify or recalculate any such information.
The Securities Administrator may make available each month, to any
interested party, the Certificates Distribution Report to Holders of the
Certificates via the Securities Administrator's website initially located at
"xxx.xxxxxxx.xxx." Assistance in using the website can be obtained by calling
the Securities Administrator's customer service desk at (000) 000-0000. Parties
that are unable to use the above distribution option are entitled to have a
paper copy mailed to them via first class mail by calling the Securities
Administrator's customer service desk and indicating such. The Securities
Administrator shall have the right to change the way such reports are
distributed in order to make such distribution more convenient and/or more
accessible to the parties, and the Securities Administrator shall provide timely
and adequate notification to all parties regarding any such change.
To the extent timely received from the Securities Administrator, the
Trustee will also make monthly statements available each month to
Certificateholders via the Trustee's internet website. The Trustee's internet
website will initially be located at
"xxxxx://xxxxxxxxxxxxxxxxxxxxxx.xxxxxx.xxx". Assistance in using the Trustee's
website service can be obtained by calling the Trustee's customer service desk
at (000) 000-0000.
(b) By April 30 of each year, the Securities Administrator will furnish
such report to each Holder of the Certificates of record at any time during the
prior calendar year as to the aggregate of amounts reported pursuant to
subclauses (a)(ii) and (a)(v) above with respect to the Certificates, plus
information with respect to the amount of servicing compensation and such other
customary information as the Securities Administrator may determine to be
necessary and/or to be required by the Internal Revenue Service or by a federal
or state law or rules or regulations to enable such Holders to prepare their tax
returns for such calendar year. Such obligations shall be deemed to have been
satisfied to the extent that substantially comparable information shall be
provided by the Securities Administrator pursuant to the requirements of the
Code.
Section 6.06 MONTHLY ADVANCES.
If the Scheduled Payment on a Mortgage Loan that was due on a related
Due Date is delinquent other than as a result of application of the Relief Act
and for which the related Servicer was required to make an advance pursuant to
the related Servicing Agreement exceeds the amount deposited in the Master
Servicer Collection Account which will be used for an advance with respect to
such Mortgage Loan, the Master Servicer will deposit in the Master Servicer
Collection Account not later than the Distribution Account Deposit Date
immediately preceding the related Distribution Date an amount equal to such
deficiency, net of the Servicing Fee for such Mortgage Loan except to the extent
the Master Servicer determines any such advance to be a Nonrecoverable Advance.
Subject to the foregoing, the Master Servicer shall continue to make such
advances through the date that the related Servicer is required to do so under
its Servicing Agreement. If the Master Servicer deems an advance to be a
Nonrecoverable Advance, on the Distribution Account Deposit Date, the Master
Servicer shall present an Officer's Certificate to the Paying Agent (i) stating
that the Master Servicer elects not to make a Monthly Advance in a stated amount
and (ii) detailing the reason it deems the advance to be a Nonrecoverable
Advance.
Section 6.07 COMPENSATING INTEREST PAYMENTS.
The Master Servicer shall deposit in the Master Servicer Collection
Account not later than each Distribution Account Deposit Date an amount equal to
the lesser of (i) the sum of the aggregate amounts required to be paid by the
Servicers under the related Servicing Agreement with respect to subclauses (a)
and (b) of the definition of Interest Shortfall with respect to the Mortgage
Loans for the related Distribution Date, and not so paid by the Servicers and
(ii) the Master Servicing Fee for such Distribution Date (such amount, the
"Compensating Interest Payment"). The Master Servicer shall not be entitled to
any reimbursement of any Compensating Interest Payment.
ARTICLE VII
The Master Servicer-
Section 7.01 LIABILITIES OF THE MASTER SERVICER.
The Master Servicer shall be liable in accordance herewith only to the
extent of the obligations specifically imposed upon and undertaken by it herein.
Section 7.02 MERGER OR CONSOLIDATION OF THE MASTER SERVICER.
(a) The Master Servicer will keep in full force and effect its
existence, rights and franchises as a corporation under the laws of the state of
its incorporation, and will obtain and preserve its qualification to do business
as a foreign corporation in each jurisdiction in which such qualification is or
shall be necessary to protect the validity and enforceability of this Agreement,
the Certificates or any of the Mortgage Loans and to perform its duties under
this Agreement.
(b) Any Person into which the Master Servicer may be merged or
consolidated, or any corporation resulting from any merger or consolidation to
which the Master Servicer shall be a party, or any Person succeeding to the
business of the Master Servicer, shall be the successor of the Master Servicer
hereunder, without the execution or filing of any paper or further act on the
part of any of the parties hereto, anything herein to the contrary
notwithstanding.
Section 7.03 INDEMNIFICATION OF THE TRUSTEE, THE MASTER SERVICER AND
THE SECURITIES ADMINISTRATOR.
(a) The Master Servicer agrees to indemnify the Indemnified Persons
for, and to hold them harmless against, any loss, liability or expense
(including reasonable legal fees and disbursements of counsel) incurred on their
part that may be sustained in connection with, arising out of, or relating to,
any claim or legal action (including any pending or threatened claim or legal
action) relating to this Agreement with respect to the Mortgage Loans and the
Certificates, the Servicing Agreements, the Assignment Agreement or the
Certificates or the powers of attorney delivered by the Trustee hereunder (i)
related to the Master Servicer's failure to perform its duties in compliance
with this Agreement (except as any such loss, liability or expense shall be
otherwise reimbursable pursuant to this Agreement) or (ii) incurred by reason of
the Master Servicer's willful misfeasance, bad faith or gross negligence in the
performance of duties hereunder or by reason of reckless disregard of
obligations and duties hereunder, provided, in each case, that with respect to
any such claim or legal action (or pending or threatened claim or legal action),
the Indemnified Person shall have given the Master Servicer and the Depositor
written notice thereof promptly after the Indemnified Person shall have with
respect to such claim or legal action knowledge thereof. The Master Servicer's
failure to receive any such notice shall not affect the Indemnified Person right
to indemnification hereunder, except to the extent the Master Servicer is
materially prejudiced by such failure to give notice. This indemnity shall
survive the resignation or removal of the Trustee, Master Servicer or the
Securities Administrator and the termination of this Agreement.
(b) [Reserved].
(c) The Trust Fund will indemnify any Indemnified Person for any loss,
liability or expense of any Indemnified Person not otherwise covered by the
Master Servicer's indemnification pursuant to Subsection (a) above.
Section 7.04 LIMITATIONS ON LIABILITY OF THE MASTER SERVICER AND
OTHERS.
Subject to the obligation of the Master Servicer to indemnify the
Indemnified Persons pursuant to Section 7.03:
(a) Neither the Master Servicer nor any of the directors, officers,
employees or agents of the Master Servicer shall be under any liability to the
Indemnified Persons, the Depositor, the Trust Fund or the Holders of the
Certificates for taking any action or for refraining from taking any action in
good faith pursuant to this Agreement, or for errors in judgment; provided,
however, that this provision shall not protect the Master Servicer or any such
Person against any breach of warranties or representations made herein or any
liability which would otherwise be imposed by reason of such Person's willful
misfeasance, bad faith or gross negligence in the performance of duties or by
reason of reckless disregard of obligations and duties hereunder.
(b) The Master Servicer and any director, officer, employee or agent of
the Master Servicer may rely in good faith on any document of any kind prima
facie properly executed and submitted by any Person respecting any matters
arising hereunder.
(c) The Master Servicer, the Custodian and any director, officer,
employee or agent of the Master Servicer or the Custodian, and the Trustee, to
the extent it becomes a party to the Xxxxx Fargo Servicing Agreement pursuant to
Section 3.03, and any officer, director, employee or agent of the Trustee, shall
be indemnified by the Trust and held harmless thereby against any loss,
liability or expense (including reasonable legal fees and disbursements of
counsel) incurred on their part that may be sustained in connection with,
arising out of, or related to, any claim or legal action (including any pending
or threatened claim or legal action) relating to this Agreement, the
Certificates or any Servicing Agreement (except to the extent that the Master
Servicer or the Trustee, as the case may be, is indemnified by the Servicer
thereunder), other than (i) any such loss, liability or expense related to the
Master Servicer's failure to perform its duties in compliance with this
Agreement (except as any such loss, liability or expense shall be otherwise
reimbursable pursuant to this Agreement), or to the Custodian's failure to
perform its duties under the Custodial Agreement, respectively, or (ii) any such
loss, liability or expense incurred by reason of the Master Servicer's or the
Custodian's willful misfeasance, bad faith or gross negligence in the
performance of duties hereunder or under the Custodial Agreement, as applicable,
or by reason of reckless disregard of obligations and duties hereunder or under
the Custodial Agreement, as applicable.
(d) The Master Servicer shall not be under any obligation to appear in,
prosecute or defend any legal action that is not incidental to its duties under
this Agreement and that in its opinion may involve it in any expense or
liability; provided, however, the Master Servicer may in its discretion, with
the consent of the Trustee (which consent shall not be unreasonably withheld),
undertake any such action which it may deem necessary or desirable with respect
to this Agreement and the rights and duties of the parties hereto and the
interests of the Holders of the Certificates hereunder. In such event, the legal
expenses and costs of such action and any liability resulting therefrom shall be
expenses, costs and liabilities of the Trust Fund and the Master Servicer shall
be entitled to be reimbursed therefor out of the Master Servicer Collection
Account as provided by Section 4.03. Nothing in this Subsection 7.04(d) shall
affect the Master Servicer's obligation to supervise, or to take such actions as
are necessary to ensure, the servicing and administration of the Mortgage Loans
pursuant to Subsection 3.01(a).
(e) In taking or recommending any course of action pursuant to this
Agreement, unless specifically required to do so pursuant to this Agreement, the
Master Servicer shall not be required to investigate or make recommendations
concerning potential liabilities which the Trust might incur as a result of such
course of action by reason of the condition of the Mortgaged Properties but
shall give notice to the Trustee if it has notice of such potential liabilities.
(f) The Master Servicer shall not be liable for any acts or omissions
of any Servicers, with the exception of Xxxxx Fargo, except as otherwise
expressly provided herein.
Section 7.05 MASTER SERVICER NOT TO RESIGN.
Except as provided in Section 7.07, the Master Servicer shall not
resign from the obligations and duties hereby imposed on it except upon a
determination that any such duties hereunder are no longer permissible under
applicable law and such impermissibility cannot be cured; provided, however, in
the event that the Securities Administrator resigns or is terminated or removed
in accordance with the provisions hereof, the Master Servicer shall resign. Any
such determination permitting the resignation of the Master Servicer shall be
evidenced by an Opinion of Independent Counsel addressed to the Trustee to such
effect delivered to the Trustee. No such resignation by the Master Servicer
shall become effective until the Company or the Trustee or a successor to the
Master Servicer reasonably satisfactory to the Trustee shall have assumed the
responsibilities and obligations of the Master Servicer in accordance with
Section 8.02 hereof. The Trustee shall notify the Rating Agencies of the
resignation of the Master Servicer.
Section 7.06 SUCCESSOR MASTER SERVICER.
In connection with the appointment of any successor master servicer or
the assumption of the duties of the Master Servicer, the Company or the Trustee
may make such arrangements for the compensation of such successor master
servicer out of payments on the Mortgage Loans as the Company or the Trustee and
such successor master servicer shall agree. If the successor master servicer
does not agree that such market value is a fair price, such successor master
servicer shall obtain two quotations of market value from third parties actively
engaged in the servicing of single-family mortgage loans. Notwithstanding the
foregoing, the compensation payable to a successor master servicer may not
exceed the compensation which the Master Servicer would have been entitled to
retain if the Master Servicer had continued to act as Master Servicer hereunder.
Section 7.07 SALE AND ASSIGNMENT OF MASTER SERVICING.
The Master Servicer may sell and assign its rights and delegate its
duties and obligations in its entirety as Master Servicer under this Agreement
and the Company may terminate the Master Servicer without cause and select a new
Master Servicer; provided, however, that: (i) the purchaser or transferee
accepting such assignment and delegation (a) shall be a Person which shall be
qualified to service mortgage loans for Xxxxxx Mae or Xxxxxxx Mac; (b) shall
have a net worth of not less than $10,000,000 (unless otherwise approved by each
Rating Agency pursuant to clause (ii) below); (c) shall be reasonably
satisfactory to the Trustee (as evidenced in a writing signed by the Trustee);
and (d) shall execute and deliver to the Trustee an agreement, in form and
substance reasonably satisfactory to the Trustee, which contains an assumption
by such Person of the due and punctual performance and observance of each
covenant and condition to be performed or observed by it as master servicer
under this Agreement, any custodial agreement from and after the effective date
of such agreement; (ii) each Rating Agency shall be given prior written notice
of the identity of the proposed successor to the Master Servicer and each Rating
Agency's rating of the Certificates (determined without regard to the Policy) in
effect immediately prior to such assignment, sale and delegation will not be
downgraded, qualified or withdrawn as a result of such assignment, sale and
delegation, as evidenced by a letter to such effect delivered to the Master
Servicer and the Trustee; (iii) the Master Servicer assigning and selling the
master servicing shall deliver to the Trustee an Officer's Certificate and an
Opinion of Independent Counsel addressed to the Trustee, each stating that all
conditions precedent to such action under this Agreement have been completed and
such action is permitted by and complies with the terms of this Agreement; and
(iv) in the event the Master Servicer is terminated without cause by the
Company, the Company shall pay the terminated Master Servicer a termination fee
equal to 0.25% of the aggregate Scheduled Principal Balance of the Mortgage
Loans at the time the master servicing of the Mortgage Loans is transferred to
the successor Master Servicer. No such assignment or delegation shall affect any
liability of the Master Servicer arising prior to the effective date thereof.
ARTICLE VIII
Default
Section 8.01 EVENTS OF DEFAULT.
"Event of Default," wherever used herein, means any one of the
following events (whatever the reason for such Event of Default and whether it
shall be voluntary or involuntary or be effected by operation of law or pursuant
to any judgment, decree or order of any court or any order, rule or regulation
of any administrative or governmental body) and only with respect to the
defaulting Master Servicer:
(i) The Master Servicer fails to cause to be deposited in the
Distribution Account any amount so required to be deposited by it pursuant to
this Agreement (other than a Monthly Advance), and such failure continues
unremedied for a period of three Business Days after the date upon which written
notice of such failure, requiring the same to be remedied, shall have been given
to the Master Servicer; or
(ii) The Master Servicer fails to observe or perform in any
material respect any other material covenants and agreements set forth in this
Agreement to be performed by it, which covenants and agreements materially
affect the rights of Holders of the Certificates, and such failure continues
unremedied for a period of 60 days after the date on which written notice of
such failure, properly requiring the same to be remedied, shall have been given
to the Master Servicer by the Trustee or to the Master Servicer and the Trustee
by the Holders of Certificates evidencing Fractional Undivided Interests
aggregating not less than 25% of the Trust Fund; or
(iii) There is entered against the Master Servicer a decree or
order by a court or agency or supervisory authority having jurisdiction in the
premises for the appointment of a conservator, receiver or liquidator in any
insolvency, readjustment of debt, marshaling of assets and liabilities or
similar proceedings, or for the winding up or liquidation of its affairs, and
the continuance of any such decree or order is unstayed and in effect for a
period of 60 consecutive days, or an involuntary case is commenced against the
Master Servicer under any applicable insolvency or reorganization statute and
the petition is not dismissed within 60 days after the commencement of the case;
or
(iv) The Master Servicer consents to the appointment of a
conservator or receiver or liquidator in any insolvency, readjustment of debt,
marshaling of assets and liabilities or similar proceedings of or relating to
the Master Servicer or substantially all of its property; or the Master Servicer
admits in writing its inability to pay its debts generally as they become due,
files a petition to take advantage of any applicable insolvency or
reorganization statute, makes an assignment for the benefit of its creditors, or
voluntarily suspends payment of its obligations;
(v) The Master Servicer assigns or delegates its duties or
rights under this Agreement in contravention of the provisions permitting such
assignment or delegation under Sections 7.05 or 7.07; or
(vi) The Master Servicer fails to deposit or cause to be
deposited, in the Distribution Account any Monthly Advance (other than a
Nonrecoverable Advance) by 5:00 p.m. New York City time on the Distribution
Account Deposit Date.
In each and every such case, so long as such Event of Default with respect to
the Master Servicer shall not have been remedied, either the Trustee or the
Holders of Certificates evidencing Fractional Undivided Interests aggregating
not less than 51% of the principal of the Trust Fund, by notice in writing to
the Master Servicer (and to the Trustee if given by such Holders of the
Certificates), with a copy to the Rating Agencies, and with the consent of the
Company, may terminate all of the rights and obligations (but not the
liabilities) of the Master Servicer under this Agreement and in and to the
Mortgage Loans and/or the REO Property serviced by the Master Servicer and the
proceeds thereof. Upon the receipt by the Master Servicer of the written notice,
all authority and power of the Master Servicer under this Agreement, whether
with respect to the Certificates, the Mortgage Loans, REO Property or under any
other related agreements (but only to the extent that such other agreements
relate to the Mortgage Loans or related REO Property) shall, subject to Section
8.02, automatically and without further action pass to and be vested in the
Trustee pursuant to this Section 8.01; and, without limitation, the Trustee is
hereby authorized and empowered to execute and deliver, on behalf of the Master
Servicer as attorney-in-fact or otherwise, any and all documents and other
instruments and to do or accomplish all other acts or things necessary or
appropriate to effect the purposes of such notice of termination, whether to
complete the transfer and endorsement or assignment of the Mortgage Loans and
related documents, or otherwise. The Master Servicer agrees to cooperate with
the Trustee in effecting the termination of the Master Servicer's rights and
obligations hereunder, including, without limitation, the transfer to the
Trustee of (i) the property and amounts which are then or should be part of the
Trust or which thereafter become part of the Trust; and (ii) originals or copies
of all documents of the Master Servicer reasonably requested by the Trustee to
enable it to assume the Master Servicer's duties thereunder. All reasonable and
properly documented costs and expenses incurred by the Trustee in connection
with such transfer shall be reimbursed to the Trustee by the Master Servicer
within 30 days of request therefor or, if the Master Servicer fails to pay any
such amount, reimbursed from amounts on deposit in the Distribution Amount. In
addition to any other amounts which are then, or, notwithstanding the
termination of its activities under this Agreement, may become payable to the
Master Servicer under this Agreement, the Master Servicer shall be entitled to
receive, out of any amount received on account of a Mortgage Loan or related REO
Property, that portion of such payments which it would have received as
reimbursement under this Agreement if notice of termination had not been given.
The termination of the rights and obligations of the Master Servicer shall not
affect any obligations incurred by the Master Servicer prior to such
termination.
Notwithstanding the foregoing, if an Event of Default described in
clause (vi) of this Section 8.01 shall occur, the Trustee shall, by notice in
writing to the Master Servicer, which may be delivered by telecopy, immediately
terminate all of the rights and obligations of the Master Servicer thereafter
arising under this Agreement, but without prejudice to any rights it may have as
a Holder of the Certificates or to reimbursement of Monthly Advances and other
advances of its own funds, and the Trustee shall act as provided in Section 8.02
to carry out the duties of the Master Servicer, including the obligation to make
any Monthly Advance the nonpayment of which was an Event of Default described in
clause (vi) of this Section 8.01. Any such action taken by the Trustee must be
prior to the distribution on the relevant Distribution Date.
Section 8.02 TRUSTEE TO ACT; APPOINTMENT OF SUCCESSOR.
(a) Upon the receipt by the Master Servicer of a notice of termination
pursuant to Section 8.01 or an Opinion of Independent Counsel pursuant to
Section 7.05 to the effect that the Master Servicer is legally unable to act or
to delegate its duties to a Person which is legally able to act, the Trustee
shall automatically become the successor in all respects to the Master Servicer
in its capacity under this Agreement and the transactions set forth or provided
for herein and shall thereafter be subject to all the responsibilities, duties,
liabilities and limitations on liabilities relating thereto placed on the Master
Servicer by the terms and provisions hereof (including the requirement to make
Monthly Advances pursuant to Section 6.06); provided, however, that the Company
shall have the right to either (a) immediately assume the duties of the Master
Servicer or (b) select a successor Master Servicer; provided further, however,
that the Trustee shall have no obligation whatsoever with respect to any
liability (other than advances deemed recoverable and not previously made)
incurred by the Master Servicer at or prior to the time of termination. As
compensation therefor, the Trustee shall be entitled to compensation which the
Master Servicer would have been entitled to retain if the Master Servicer had
continued to act hereunder, except for those amounts due the Master Servicer as
reimbursement permitted under this Agreement for advances previously made or
expenses previously incurred. Notwithstanding the above, the Trustee may, if it
shall be unwilling so to act, or shall, if it is legally unable so to act,
appoint or petition a court of competent jurisdiction to appoint, any
established housing and home finance institution which is a Xxxxxx Xxx- or
Xxxxxxx Mac-approved servicer, and with respect to a successor to the Master
Servicer only, having a net worth of not less than $10,000,000, as the successor
to the Master Servicer hereunder in the assumption of all or any part of the
responsibilities, duties or liabilities of the Master Servicer hereunder;
provided, that the Trustee shall obtain a letter from each Rating Agency that
the ratings, if any, on each of the Certificates (determined without regard to
the Policy) will not be lowered as a result of the selection of the successor to
the Master Servicer. Pending appointment of a successor to the Master Servicer
hereunder, the Trustee shall act in such capacity as hereinabove provided. In
connection with such appointment and assumption, the Trustee may make such
arrangements for the compensation of such successor out of payments on the
Mortgage Loans as it and such successor shall agree; provided, however, that the
provisions of Section 7.06 shall apply, the compensation shall not be in excess
of that which the Master Servicer would have been entitled to if the Master
Servicer had continued to act hereunder, and that such successor shall undertake
and assume the obligations of the Master Servicer to pay compensation to any
third Person acting as an agent or independent contractor in the performance of
master servicing responsibilities hereunder. The Trustee and such successor
shall take such action, consistent with this Agreement, as shall be necessary to
effectuate any such succession.
(b) If the Trustee shall succeed to any duties of the Master Servicer
respecting the Mortgage Loans as provided herein, it shall do so in a separate
capacity and not in its capacity as Trustee and, accordingly, the provisions of
Article IX shall be inapplicable to the Trustee in its duties as the successor
to the Master Servicer in the servicing of the Mortgage Loans (although such
provisions shall continue to apply to the Trustee in its capacity as Trustee);
the provisions of Article VII, however, shall apply to it in its capacity as
successor master servicer.
Section 8.03 NOTIFICATION TO CERTIFICATEHOLDERS.
Upon any termination or appointment of a successor to the Master
Servicer, the Trustee shall give prompt written notice thereof to Holders of the
Certificates at their respective addresses appearing in the Certificate Register
and to the Rating Agencies.
Section 8.04 WAIVER OF DEFAULTS.
The Trustee shall transmit by mail to all Holders of the Certificates,
within 60 days after the occurrence of any Event of Default actually known to a
Responsible Officer of the Trustee, unless such Event of Default shall have been
cured, notice of each such Event of Default. The Holders of Certificates
evidencing Fractional Undivided Interests aggregating not less than 51% of the
Trust Fund may, on behalf of all Holders of the Certificates, waive any default
by the Master Servicer in the performance of its obligations hereunder and the
consequences thereof, except a default in the making of or the causing to be
made any required distribution on the Certificates, which default may only be
waived by Holders of Certificates evidencing Fractional Undivided Interests
aggregating 100% of the Trust Fund. Upon any such waiver of a past default, such
default shall be deemed to cease to exist, and any Event of Default arising
therefrom shall be deemed to have been timely remedied for every purpose of this
Agreement. No such waiver shall extend to any subsequent or other default or
impair any right consequent thereon except to the extent expressly so waived.
The Trustee shall give notice of any such waiver to the Rating Agencies.
Section 8.05 LIST OF CERTIFICATEHOLDERS.
Upon written request of three or more Holders of Certificates of
record, for purposes of communicating with other Holders of Certificates with
respect to their rights under this Agreement, the Certificate Registrar will
afford such Certificateholders access during business hours to the most recent
list of related Certificateholders held by the Certificate Registrar.
ARTICLE IX
Concerning the Trustee and the Securities Administrator
Section 9.01 DUTIES OF TRUSTEE AND SECURITIES ADMINISTRATOR.
(a) The Trustee, prior to the occurrence of an Event of Default and
after the curing or waiver of all Events of Default which may have occurred, and
the Securities Administrator each undertake to perform such duties and only such
duties as are specifically set forth in this Agreement as duties of the Trustee
and the Securities Administrator, respectively. If an Event of Default has
occurred and has not been cured or waived, the Trustee shall exercise such of
the rights and powers vested in it by this Agreement use the same degree of care
and skill in their exercise, as a prudent person would exercise under the
circumstances in the conduct of his own affairs.
(b) Upon receipt of all resolutions, certificates, statements,
opinions, reports, documents, orders or other instruments which are specifically
required to be furnished to the Trustee and the Securities Administrator
pursuant to any provision of this Agreement, the Trustee and the Securities
Administrator, respectively, shall examine them to determine whether they are on
their face in the form required by this Agreement; provided, however, that
neither the Trustee nor the Securities Administrator shall be responsible for
the accuracy or content of any resolution, certificate, statement, opinion,
report, document, order or other instrument furnished hereunder; provided,
further, that neither the Trustee nor the Securities Administrator shall be
responsible for the accuracy or verification of any calculation provided to it
pursuant to this Agreement.
(c) On each Distribution Date, the Paying Agent shall make monthly
distributions and the final distribution to the related Certificateholders from
funds in the Distribution Account, as provided in Sections 6.01 and 10.01 herein
based solely on the report of the Securities Administrator.
(d) No provision of this Agreement shall be construed to relieve the
Trustee or the Securities Administrator from liability for its own negligent
action, its own negligent failure to act or its own willful misconduct;
provided, however, that:
(i) Prior to the occurrence of an Event of Default, and after
the curing or waiver of all such Events of Default which may have occurred, the
duties and obligations of the Trustee and the Securities Administrator shall be
determined solely by the express provisions of this Agreement, neither the
Trustee nor the Securities Administrator shall be liable except for the
performance of their respective duties and obligations as are specifically set
forth in this Agreement, no implied covenants or obligations shall be read into
this Agreement against the Trustee or the Securities Administrator and, in the
absence of bad faith on the part of the Trustee or the Securities Administrator,
respectively, the Trustee or the Securities Administrator, respectively, may
conclusively rely, as to the truth of the statements and the correctness of the
opinions expressed therein, upon any certificates or opinions furnished to the
Trustee or the Securities Administrator, respectively, and conforming to the
requirements of this Agreement;
(ii) Neither the Trustee nor the Securities Administrator
shall be liable in its individual capacity for an error of judgment made in good
faith by a Responsible Officer or Responsible Officers of the Trustee or an
officer of the Securities Administrator, respectively, unless it shall be proved
that the Trustee or the Securities Administrator, respectively, was negligent in
ascertaining the pertinent facts;
(iii) Neither the Trustee nor the Securities Administrator
shall be liable with respect to any action taken, suffered or omitted to be
taken by it in good faith in accordance with the directions of the Holders of
Certificates evidencing Fractional Undivided Interests aggregating not less than
25% of the portion of the Trust Fund related to such Certificates, if such
action or non-action relates to the time, method and place of conducting any
proceeding for any remedy available to the Trustee or the Securities
Administrator, respectively, or exercising any trust or other power conferred
upon the Trustee or the Securities Administrator, respectively, under this
Agreement;
(iv) The Trustee shall not be required to take notice or be
deemed to have notice or knowledge of any default or Event of Default unless a
Responsible Officer of the Trustee's Corporate Trust Office shall have actual
knowledge thereof. In the absence of such notice, the Trustee may conclusively
assume there is no such default or Event of Default;
(v) The Trustee shall not in any way be liable by reason of
any insufficiency in any Account held by or in the name of Trustee unless it is
determined by a court of competent jurisdiction that the Trustee's gross
negligence or willful misconduct was the primary cause of such insufficiency
(except to the extent that the Trustee is obligor and has defaulted thereon);
(vi) Anything in this Agreement to the contrary
notwithstanding, in no event shall the Trustee or the Securities Administrator
be liable for special, indirect or consequential loss or damage of any kind
whatsoever (including but not limited to lost profits), even if the Trustee or
the Securities Administrator, respectively, has been advised of the likelihood
of such loss or damage and regardless of the form of action;
(vii) None of the Securities Administrator, the Depositor, the
Company or the Trustee shall be responsible for the acts or omissions of the
other, it being understood that this Agreement shall not be construed to render
them partners, joint venturers or agents of one another and
(viii) Neither the Trustee nor the Securities Administrator
shall be required to expend or risk its own funds or otherwise incur financial
liability in the performance of any of its duties hereunder, or in the exercise
of any of its rights or powers, if there is reasonable ground for believing that
the repayment of such funds or adequate indemnity against such risk or liability
is not reasonably assured to it, and none of the provisions contained in this
Agreement shall in any event require the Trustee or the Securities Administrator
to perform, or be responsible for the manner of performance of, any of the
obligations of the Master Servicer under the Servicing Agreements, except during
such time, if any, as the Trustee shall be the successor to, and be vested with
the rights, duties, powers and privileges of, the Master Servicer in accordance
with the terms of this Agreement.
(e) All funds received by the Master Servicer and the Paying Agent and
required to be deposited in the Master Servicer Collection Account, Distribution
Account pursuant to this Agreement will be promptly so deposited by the Master
Servicer or the Paying Agent, as applicable.
(f) Except for those actions that the Trustee or the Securities
Administrator is required to take hereunder, neither the Trustee nor the
Securities Administrator shall have any obligation or liability to take any
action or to refrain from taking any action hereunder in the absence of written
direction as provided hereunder.
Section 9.02 CERTAIN MATTERS AFFECTING THE TRUSTEE AND THE SECURITIES
ADMINISTRATOR.
Except as otherwise provided in Section 9.01:
(i) The Trustee and the Securities Administrator may rely and
shall be protected in acting or refraining from acting in reliance on any
resolution, certificate of the Depositor, the Master Servicer or a Servicer,
certificate of auditors or any other certificate, statement, instrument,
opinion, report, notice, request, consent, order, appraisal, bond or other paper
or document believed by it to be genuine and to have been signed or presented by
the proper party or parties;
(ii) The Trustee and the Securities Administrator may consult
with counsel and any advice of such counsel or any Opinion of Counsel shall be
full and complete authorization and protection with respect to any action taken
or suffered or omitted by it hereunder in good faith and in accordance with such
advice or Opinion of Counsel;
(iii) Neither the Trustee nor the Securities Administrator
shall be under any obligation to exercise any of the trusts or powers vested in
it by this Agreement, other than its obligation to give notices pursuant to this
Agreement, or to institute, conduct or defend any litigation hereunder or in
relation hereto at the request, order or direction of any of the
Certificateholders pursuant to the provisions of this Agreement, unless such
Certificateholders shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities which may be incurred
therein or thereby. Nothing contained herein shall, however, relieve the Trustee
of the obligation, upon the occurrence of an Event of Default of which a
Responsible Officer of the Trustee has actual knowledge (which has not been
cured or waived), to exercise such of the rights and powers vested in it by this
Agreement, and to use the same degree of care and skill in their exercise, as a
prudent person would exercise under the circumstances in the conduct of his own
affairs;
(iv) Prior to the occurrence of an Event of Default hereunder
and after the curing or waiver of all Events of Default which may have occurred,
neither the Trustee nor the Securities Administrator shall be liable for any
action taken, suffered or omitted by it in good faith and believed by it to be
authorized or within the discretion or rights or powers conferred upon it by
this Agreement;
(v) Neither the Trustee nor the Securities Administrator shall
be bound to make any investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion, report, notice,
request, consent, order, approval, bond or other paper or document, unless
requested in writing to do so by Holders of Certificates evidencing Fractional
Undivided Interests aggregating not less than 25% of the portion of the Trust
Fund related to such Certificates, and provided that the payment within a
reasonable time to the Trustee or the Securities Administrator, as applicable,
of the costs, expenses or liabilities likely to be incurred by it in the making
of such investigation is, in the opinion of the Trustee or the Securities
Administrator, as applicable, reasonably assured to the Trustee or the
Securities Administrator, as applicable, by the security afforded to it by the
terms of this Agreement. The Trustee or the Securities Administrator may require
reasonable indemnity against such expense or liability as a condition to taking
any such action. The reasonable expense of every such examination shall be paid
by the related Certificateholders requesting the investigation;
(vi) The Trustee and the Securities Administrator may execute
any of the trusts or powers hereunder or perform any duties hereunder either
directly or through Affiliates, agents or attorneys; provided, however, that the
Trustee may not appoint any agent to perform its custodial functions with
respect to the Mortgage Files or paying agent functions under this Agreement
without the express written consent of the Master Servicer, which consent will
not be unreasonably withheld. Neither the Trustee nor the Securities
Administrator shall be liable or responsible for the misconduct or negligence of
any of the Trustee's or the Securities Administrator's agents or attorneys or a
custodian or paying agent appointed hereunder by the Trustee or the Securities
Administrator with due care and, when required, with the consent of the Master
Servicer;
(vii) Should the Trustee or the Securities Administrator deem
the nature of any action required on its part, to be unclear, the Trustee or the
Securities Administrator, respectively, may require prior to such action that it
be provided by the Depositor with reasonable further instructions;
(viii) The right of the Trustee or the Securities
Administrator to perform any discretionary act enumerated in this Agreement
shall not be construed as a duty, and neither the Trustee nor the Securities
Administrator shall be accountable for other than its negligence or willful
misconduct in the performance of any such act;
(ix) Neither the Trustee nor the Securities Administrator
shall be required to give any bond or surety with respect to the execution of
the trust created hereby or the powers granted hereunder, except as provided in
Subsection 9.07; and
(x) Neither the Trustee nor the Securities Administrator shall
have any duty to conduct any affirmative investigation as to the occurrence of
any condition requiring the repurchase of any Mortgage Loan by the Seller
pursuant to this Agreement or the Mortgage Loan Purchase Agreement, as
applicable, or the eligibility of any Mortgage Loan for purposes of this
Agreement.
Section 9.03 TRUSTEE AND SECURITIES ADMINISTRATOR NOT LIABLE FOR
CERTIFICATES OR MORTGAGE LOANS.
The recitals contained herein and in the Certificates (other than the
signature and countersignature of the Certificate Registrar on such
Certificates) shall be taken as the statements of the Depositor, and neither the
Trustee, nor the Custodian on its behalf, nor the Securities Administrator shall
have any responsibility for their correctness. Neither the Trustee nor the
Securities Administrator makes any representation as to the validity or
sufficiency of the Certificates (other than the signature and countersignature
of the Certificate Registrar on the such Certificates) or of any Mortgage Loan;
provided, however, that the foregoing shall not relieve the Trustee, or the
Custodian on its behalf, of the obligation to review the Mortgage Files pursuant
to Sections 2.02 and 2.04. The Securities Administrator's signature and
countersignature (or countersignature of its agent) on the Certificates shall be
solely in its capacity as Securities Administrator and shall not constitute the
Certificates an obligation of the Securities Administrator in any other
capacity. Neither the Trustee or the Securities Administrator shall be
accountable for the use or application by the Depositor of any of the
Certificates or of the proceeds of such Certificates, or for the use or
application of any funds paid to the Depositor with respect to the Mortgage
Loans. Neither the Trustee nor the Securities Administrator shall be responsible
for the legality or validity of this Agreement or any document or instrument
relating to this Agreement, the validity of the execution of this Agreement or
of any supplement hereto or instrument of further assurance, or the validity,
priority, perfection or sufficiency of the security for the Certificates issued
hereunder or intended to be issued hereunder. Neither the Trustee nor the
Securities Administrator shall at any time have any responsibility or liability
for or with respect to the legality, validity and enforceability of any Mortgage
or any Mortgage Loan, or the perfection and priority of any Mortgage or the
maintenance of any such perfection and priority, or for or with respect to the
sufficiency of either Trust Fund, or any portion of either Trust Fund or its
ability to make the payments to be distributed to Certificateholders, under this
Agreement. Neither the Trustee nor the Securities Administrator shall have any
responsibility for filing any financing statement or continuation statement in
any public office at any time or to otherwise perfect or maintain the perfection
of any security interest or lien granted to it hereunder or to record this
Agreement.
Section 9.04 TRUSTEE AND SECURITIES ADMINISTRATOR MAY OWN
CERTIFICATES.
The Trustee and the Securities Administrator in its individual capacity
or in any capacity other than as Trustee hereunder may become the owner or
pledgee of any Certificates with the same rights it would have if it were not
Trustee or the Securities Administrator, as applicable, and may otherwise deal
with the parties hereto.
Section 9.05 TRUSTEE'S AND SECURITIES ADMINISTRATOR'S FEES AND
EXPENSES.
The fees of the Trustee shall be paid in accordance with a side letter
agreement between the Trustee and the Master Servicer. With respect to the Trust
Fund, the Securities Administrator shall be entitled to receive a fee payable by
the Master Servicer and as agreed to between the Securities Administrator and
the Master Servicer in a separate agreement. In addition, the Trustee and the
Securities Administrator will be entitled to recover, from the Distribution
Account pursuant to Section 4.05 with respect to the Certificates all reasonable
out-of-pocket expenses, indemnification payments, disbursements and advances and
the expenses of the Trustee and the Securities Administrator, respectively, in
connection with any Event of Default, any breach of this Agreement or any claim
or legal action (including any pending or threatened claim or legal action) or
incurred or made by the Trustee or the Securities Administrator, respectively,
in the administration of the trusts hereunder (including the reasonable
compensation, expenses and disbursements of its counsel) except any such
expense, disbursement or advance as may arise from its negligence or intentional
misconduct or which is the responsibility of the related Certificateholders. If
funds in the Distribution Account are insufficient therefor, the Trustee and the
Securities Administrator shall recover such expenses from the Depositor and the
Depositor hereby agrees to pay such expenses, disbursements or advances upon
demand. Such compensation and reimbursement obligation shall not be limited by
any provision of law in regard to the compensation of a trustee of an express
trust.
Section 9.06 ELIGIBILITY REQUIREMENTS FOR TRUSTEE AND SECURITIES
ADMINISTRATOR.
The Trustee and any successor Trustee and the Securities Administrator
and any successor Securities Administrator shall during the entire duration of
this Agreement be a state bank or trust company or a national banking
association organized and doing business under the laws of such state or the
United States of America, authorized under such laws to exercise corporate trust
powers, having a combined capital and surplus and undivided profits of at least
$40,000,000 or, in the case of a successor Trustee, $50,000,000, subject to
supervision or examination by federal or state authority and, in the case of the
Trustee, rated "BBB" or higher by S&P or Fitch Ratings and "Baa2" or higher by
Xxxxx'x with respect to their long-term rating and rated "BBB" or higher by S&P
or Fitch Ratings and "Baa2" or higher by Xxxxx'x with respect to any outstanding
long-term unsecured unsubordinated debt, and, in the case of a successor Trustee
or successor Securities Administrator other than pursuant to Section 9.10, rated
in one of the two highest long-term debt categories of, or otherwise acceptable
to, each of the Rating Agencies. If the Trustee publishes reports of condition
at least annually, pursuant to law or to the requirements of the aforesaid
supervising or examining authority, then for the purposes of this Section 9.06
the combined capital and surplus of such corporation shall be deemed to be its
total equity capital (combined capital and surplus) as set forth in its most
recent report of condition so published. In case at any time the Trustee or the
Securities Administrator shall cease to be eligible in accordance with the
provisions of this Section 9.06, the Trustee or the Securities Administrator
shall resign immediately in the manner and with the effect specified in Section
9.08.
The Securities Administrator (i) may not be the Seller, an originator
of any of the Mortgage Loans, Master Servicer, Servicer, the Depositor or an
affiliate of the Depositor unless the Securities Administrator is in an
institutional trust department of Xxxxx Fargo, N.A., (ii) must be authorized to
exercise corporate trust powers under the laws of its jurisdiction of
organization, and (iii) must be rated at least "A/F1" by Fitch, if Fitch is a
Rating Agency, or the equivalent rating by S&P or Xxxxx'x, or such other rating
as is acceptable to Fitch as provided in writing. If no successor Securities
Administrator shall have been appointed by the Depositor and shall have accepted
appointment within 60 days after the Securities Administrator ceases to be the
Securities Administrator pursuant to this Section 9.06, then the Trustee shall
perform the duties of the Securities Administrator pursuant to this Agreement.
The Trustee shall notify the Rating Agencies of any change of Securities
Administrator. In such event, the Trustee shall assume all of the rights and
obligations of the Securities Administrator hereunder arising thereafter except
that the Trustee shall not be (i) liable for losses of the predecessor
Securities Administrator or any acts or omissions of the predecessor Securities
Administrator hereunder or (ii) deemed to have made any representations and
warranties of the Securities Administrator made herein. The Trustee shall not be
accountable, shall have no liability and makes no representation as to any acts
or omissions hereunder of the Securities Administrator until such time as the
Trustee may be required to act as successor Securities Administrator pursuant to
this Section 9.06 and thereupon only for the acts or omissions of the Trustee as
successor Securities Administrator.
The Trustee or successor Securities Administrator shall be entitled to
be reimbursed from the Master Servicer for all reasonable costs and expenses
associated with the transfer of the duties of the Securities Administrator from
the predecessor Securities Administrator, including, without limitation, any
costs or expenses associated with the complete transfer of all Securities
Administrator data as may be required by the Trustee or successor Securities
Administrator to correct any errors or insufficiencies in such Securities
Administrator data or otherwise to enable the Trustee or successor Securities
Administrator to perform the duties of the Securities Administrator properly and
effectively.
Section 9.07 INSURANCE.
The Trustee, the Paying Agent and the Securities Administrator, at
their own expense, shall at all times maintain and keep in full force and
effect: (i) fidelity insurance, (ii) theft of documents insurance and (iii)
forgery insurance (which may be collectively satisfied by a "Financial
Institution Bond" and/or a "Bankers' Blanket Bond"). All such insurance shall be
in amounts, with standard coverage and subject to deductibles, as are customary
for insurance typically maintained by banks or their affiliates which act as
custodians for investor-owned mortgage pools. A certificate of an officer of the
Trustee, the Paying Agent or the Securities Administrator as to the Trustee's,
the Paying Agent's or the Securities Administrator's, respectively, compliance
with this Section 9.07 shall be furnished to any Certificateholder upon
reasonable written request.
Section 9.08 RESIGNATION AND REMOVAL OF THE TRUSTEE AND SECURITIES
ADMINISTRATOR.
(a) The Trustee and the Securities Administrator may at any time resign
(including, in the case of the Securities Administrator, in connection with the
resignation or termination of the Master Servicer) and be discharged from the
Trust hereby created by giving written notice thereof to the Depositor, the
Seller, the Securities Administrator (or the Trustee, if the Securities
Administrator resigns) and the Master Servicer, with a copy to the Rating
Agencies. Upon receiving such notice of resignation, the Depositor shall
promptly appoint a successor trustee or successor securities administrator, as
applicable, by written instrument, in triplicate, one copy of which instrument
shall be delivered to each of the resigning trustee or securities administrator,
as applicable, and the successor trustee or securities administrator, as
applicable. If no successor trustee or successor securities administrator shall
have been so appointed and have accepted appointment within 30 days after the
giving of such notice of resignation, the resigning Trustee or Securities
Administrator may petition any court of competent jurisdiction for the
appointment of a successor trustee or securities administrator.
(b) If at any time the Trustee, the Paying Agent or the Securities
Administrator shall cease to be eligible in accordance with the provisions of
Section 9.06 and shall fail to resign after written request therefor by the
Depositor or if at any time the Trustee, the Paying Agent or the Securities
Administrator shall become incapable of acting, or shall be adjudged a bankrupt
or insolvent, or a receiver of the Trustee, the Paying Agent or the Securities
Administrator, as applicable, or of its property shall be appointed, or any
public officer shall take charge or control of the Trustee, the Paying Agent or
the Securities Administrator, as applicable, or of its property or affairs for
the purpose of rehabilitation, conservation or liquidation, then the Depositor
shall promptly remove the Trustee, or shall be entitled to remove the Paying
Agent or the Securities Administrator, as applicable, and appoint a successor
Trustee or Securities Administrator, as applicable, by written instrument, in
triplicate, one copy of which instrument shall be delivered to each of the
Trustee, the Paying Agent or Securities Administrator, as applicable, so
removed, the successor Trustee or Securities Administrator, as applicable.
(c) The Holders of Certificates evidencing Fractional Undivided
Interests aggregating not less than 51% of the portion of the Trust Fund related
to such Certificates, may at any time remove the Trustee, the Paying Agent or
the Securities Administrator and appoint a successor Trustee, Paying Agent or
Securities Administrator for the related Trust Fund by written instrument or
instruments, in quadruplicate, signed by such Holders or their attorneys-in-fact
duly authorized, one complete set of which instruments shall be delivered to the
Depositor, , the Paying Agent, the Master Servicer, the Securities Administrator
(if the Trustee or Paying Agent is removed), the Trustee (if the Securities
Administrator is removed), and the Trustee or Securities Administrator so
removed and the successor so appointed. In the event that the Trustee, the
Paying Agent or Securities Administrator is removed by the Holders of
Certificates in accordance with this Section 9.08(c), the Holders of such
Certificates shall be responsible for paying any compensation payable to a
successor Trustee, successor Paying Agent or successor Securities Administrator,
in excess of the amount paid to the predecessor Trustee, predecessor Paying
Agent or predecessor Securities Administrator, as applicable.
(d) No resignation or removal of the Trustee, the Paying Agent or the
Securities Administrator and appointment of a successor Trustee, successor
Paying Agent or Securities Administrator pursuant to any of the provisions of
this Section 9.08 shall become effective except upon appointment of and
acceptance of such appointment by the successor Trustee, successor Paying Agent
or Securities Administrator as provided in Section 9.09.
Section 9.09 SUCCESSOR TRUSTEE AND SUCCESSOR SECURITIES
ADMINISTRATOR.
(a) Any successor Trustee, Paying Agent or Securities Administrator
appointed as provided in Section 9.08 shall execute, acknowledge and deliver to
the Depositor and to its predecessor Trustee, Paying Agent or Securities
Administrator an instrument accepting such appointment hereunder. The
resignation or removal of the predecessor Trustee, Paying Agent or Securities
Administrator shall then become effective and such successor Trustee, Paying
Agent or Securities Administrator, without any further act, deed or conveyance,
shall become fully vested with all the rights, powers, duties and obligations of
its predecessor hereunder, with like effect as if originally named as Trustee,
Paying Agent or Securities Administrator herein. The predecessor Trustee, Paying
Agent or Securities Administrator shall after payment of its outstanding fees
and expenses promptly deliver to the successor Trustee, Paying Agent or
Securities Administrator, as applicable, all assets and records of the Trust
held by it hereunder, and the Depositor and the predecessor Trustee, Paying
Agent or Securities Administrator, as applicable, shall execute and deliver such
instruments and do such other things as may reasonably be required for more
fully and certainly vesting and confirming in the successor Trustee or
Securities Administrator, as applicable, all such rights, powers, duties and
obligations.
(b) No successor Trustee, Paying Agent or Securities Administrator
shall accept appointment as provided in this Section 9.09 unless at the time of
such acceptance such successor Trustee, Paying Agent or Securities Administrator
shall be eligible under the provisions of Section 9.06.
(c) Upon acceptance of appointment by a successor Trustee, Paying Agent
or Securities Administrator as provided in this Section 9.09, the successor
Trustee, Paying Agent or Securities Administrator shall mail notice of the
succession of such Trustee, Paying Agent or Securities Administrator hereunder
to all Certificateholders at their addresses as shown in the Certificate
Register and to the Rating Agencies. The Company shall pay the cost of any
mailing by the successor Trustee, Paying Agent or Securities Administrator.
Section 9.10 MERGER OR CONSOLIDATION OF TRUSTEE OR SECURITIES
ADMINISTRATOR.
Any state bank or trust company or national banking association into
which the Trustee, the Paying Agent or the Securities Administrator may be
merged or converted or with which it may be consolidated or any state bank or
trust company or national banking association resulting from any merger,
conversion or consolidation to which the Trustee, Paying Agent or the Securities
Administrator, respectively, shall be a party, or any state bank or trust
company or national banking association succeeding to all or substantially all
of the corporate trust business of the Trustee, Paying Agent or the Securities
Administrator, respectively, shall be the successor of the Trustee, Paying Agent
or the Securities Administrator, respectively, hereunder, provided such state
bank or trust company or national banking association shall be eligible under
the provisions of Section 9.06. Such succession shall be valid without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, anything herein to the contrary notwithstanding.
Section 9.11 APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE.
(a) Notwithstanding any other provisions hereof, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Trust or property constituting the same may at the time be located, the
Depositor and the Trustee acting jointly shall have the power and shall execute
and deliver all instruments to appoint one or more Persons approved by the
Trustee and the Depositor to act as co-trustee or co-trustees, jointly with the
Trustee, or separate trustee or separate trustees, of all or any part of the
Trust, and to vest in such Person or Persons, in such capacity, such title to
the Trust, or any part thereof, and, subject to the other provisions of this
Section 9.11, such powers, duties, obligations, rights and trusts as the
Depositor and the Trustee may consider necessary or desirable.
(b) If the Depositor shall not have joined in such appointment within
15 days after the receipt by it of a written request so to do, the Trustee shall
have the power to make such appointment without the Depositor.
(c) No co-trustee or separate trustee hereunder shall be required to
meet the terms of eligibility as a successor Trustee under Section 9.06
hereunder and no notice to Certificateholders of the appointment of
co-trustee(s) or separate trustee(s) shall be required under Section 9.08
hereof.
(d) In the case of any appointment of a co-trustee or separate trustee
pursuant to this Section 9.11, all rights, powers, duties and obligations
conferred or imposed upon the Trustee and required to be conferred on such
co-trustee shall be conferred or imposed upon and exercised or performed by the
Trustee and such separate trustee or co-trustee jointly, except to the extent
that under any law of any jurisdiction in which any particular act or acts are
to be performed (whether as Trustee hereunder or as successor to the Master
Servicer hereunder), the Trustee shall be incompetent or unqualified to perform
such act or acts, in which event such rights, powers, duties and obligations
(including the holding of title to the Trust or any portion thereof in any such
jurisdiction) shall be exercised and performed by such separate trustee or
co-trustee at the direction of the Trustee.
(e) Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the then separate trustees and co-trustees,
as effectively as if given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Agreement and the conditions
of this Article IX. Each separate trustee and co-trustee, upon its acceptance of
the trusts conferred, shall be vested with the estates or property specified in
its instrument of appointment, either jointly with the Trustee or separately, as
may be provided therein, subject to all the provisions of this Agreement,
specifically including every provision of this Agreement relating to the conduct
of, affecting the liability of, or affording protection to, the Trustee. Every
such instrument shall be filed with the Trustee.
(f) To the extent not prohibited by law, any separate trustee or
co-trustee may, at any time, request the Trustee, its agent or attorney-in-fact,
with full power and authority, to do any lawful act under or with respect to
this Agreement on its behalf and in its name. If any separate trustee or
co-trustee shall die, become incapable of acting, resign or be removed, all of
its estates, properties rights, remedies and trusts shall vest in and be
exercised by the Trustee, to the extent permitted by law, without the
appointment of a new or successor Trustee.
(g) No trustee under this Agreement shall be personally liable by
reason of any act or omission of another trustee under this Agreement. The
Depositor and the Trustee acting jointly may at any time accept the resignation
of or remove any separate trustee or co-trustee.
Section 9.12 FEDERAL INFORMATION RETURNS AND REPORTS TO
CERTIFICATEHOLDERS; REMIC ADMINISTRATION.
(a) For federal income tax purposes, the taxable year of each REMIC
shall be a calendar year and the Securities Administrator shall maintain or
cause the maintenance of the books of each such REMIC on the accrual method of
accounting.
(b) The Securities Administrator shall prepare and file or cause to be
filed with the Internal Revenue Service, and the Trustee shall sign, Federal tax
information returns or elections required to be made hereunder with respect to
each REMIC, each Trust Fund, if applicable, and the Certificates containing such
information and at the times and in the manner as may be required by the Code or
applicable Treasury regulations, and shall furnish to each Holder of
Certificates at any time during the calendar year for which such returns or
reports are made such statements or information at the times and in the manner
as may be required thereby, including, without limitation, reports relating to
interest, original issue discount and market discount or premium (using a
constant prepayment assumption of 300% PSA). The Securities Administrator will
apply for an Employee Identification Number from the Internal Revenue Service
under Form SS-4 or any other acceptable method for all tax entities. In
connection with the foregoing, the Securities Administrator shall timely prepare
and file, and the Trustee shall sign, Internal Revenue Service Form 8811, which
shall provide the name and address of the person who can be contacted to obtain
information required to be reported to the holders of regular interests in each
REMIC (the "REMIC Reporting Agent"). The Trustee shall make elections to treat
each REMIC as a REMIC (which elections shall apply to the taxable period ending
December 31, 2005 and each calendar year thereafter) in such manner as the Code
or applicable Treasury regulations may prescribe, and as described by the
Securities Administrator. The Trustee shall sign all tax information returns
filed pursuant to this Section and any other returns as may be required by the
Code. The Holder of the Class I-R-1 Certificate is hereby designated as the "Tax
Matters Person" (within the meaning of Treasury Regulation Section 1.860F-4(d))
for REMIC I, the Holder of the Class II-R-1 Certificate is hereby designated as
the "Tax Matters Person" for REMIC II, and the Holder of the Class I-R-2
Certificate is hereby designated as the "Tax Matters Person" for REMIC III. The
Securities Administrator is hereby designated and appointed as the agent of each
such Tax Matters Person. Any Holder of a Residual Certificate will by acceptance
thereof appoint the Securities Administrator as agent and attorney-in-fact for
the purpose of acting as Tax Matters Person for each REMIC during such time as
the Securities Administrator does not own any such Residual Certificate. In the
event that the Code or applicable Treasury regulations prohibit the Trustee from
signing tax or information returns or other statements, or the Securities
Administrator from acting as agent for the Tax Matters Person, the Trustee and
the Securities Administrator shall take whatever action that in their sole good
faith judgment is necessary for the proper filing of such information returns or
for the provision of a Tax Matters Person, including designation of the Holder
of a Residual Certificate to sign such returns or act as Tax Matters Person.
Each Holder of a Residual Certificate shall be bound by this Section.
(c) The Securities Administrator shall provide upon request and receipt
of reasonable compensation such information as required in Section 860D(a)(6)(B)
of the Code to the Internal Revenue Service, to any Person purporting to
transfer a Residual Certificate to a Person other than a transferee permitted by
Section 5.05(b), and to any regulated investment company, real estate investment
trust, common trust fund, partnership, trust, estate, organization described in
Section 1381 of the Code, or nominee holding an interest in a pass-through
entity described in Section 860E(e)(6) of the Code, any record holder of which
is not a transferee permitted by Section 5.05(b) (or which is deemed by statute
to be an entity with a disqualified member).
(d) The Securities Administrator shall prepare and file or cause to be
filed, and the Trustee shall sign, any state income tax returns required under
Applicable State Law with respect to each REMIC or the Trust Fund.
(e) Notwithstanding any other provision of this Agreement, the Trustee
and the Securities Administrator shall comply with all federal withholding
requirements respecting payments to Certificateholders of interest, original
issue discount or principal on the Certificates that the Trustee or the
Securities Administrator reasonably believes are applicable under the Code. The
consent of Certificateholders shall not be required for such withholding. In the
event the Trustee or the Securities Administrator withholds any amount from
interest, original issue discount payments or principal or advances thereof to
any Certificateholder pursuant to Federal withholding requirements, the Trustee
or the Securities Administrator shall, together with their monthly report to
such Certificateholders, indicate such amount withheld.
(f) The Trustee and the Securities Administrator agree to indemnify the
applicable Trust Fund and the Depositor for any taxes and costs including,
without limitation, any reasonable attorneys fees imposed on or incurred by such
Trust Fund, the Depositor or the Master Servicer, as a result of a breach of the
Trustee's covenants and the Securities Administrator's covenants, respectively,
set forth in this Section 9.12; provided, however, such liability and obligation
to indemnify in this paragraph shall not be joint and several, and neither the
Trustee nor the Securities Administrator shall be liable or be obligated to
indemnify either Trust Fund for the failure by the other to perform any duty
under this Agreement or the breach by the other of any covenant in this
Agreement.
ARTICLE X
Termination
Section 10.01 TERMINATION UPON REPURCHASE BY THE DEPOSITOR OR ITS
DESIGNEE OR LIQUIDATION OF THE MORTGAGE LOANS.
(a) Subject to Section 10.02, the respective obligations and
responsibilities of the Depositor, the Trustee, the Paying Agent, the Master
Servicer and the Securities Administrator created hereby with respect to the
Trust Fund (as it relates to one of the Loan Groups) and the related
Certificates, other than the obligation of the Paying Agent to make payments to
related Certificateholders as hereinafter set forth and the indemnification
obligations under Section 7.03 hereof, shall terminate upon:
(i) the repurchase by or at the direction of the Depositor or
its designee of all of the Mortgage Loans in a Loan Group and all related REO
Property remaining in the Loan Group at a price (in each case, the "Termination
Purchase Price") equal to the sum of (a) 100% of the Outstanding Principal
Balance of each such Mortgage Loan (other than a Mortgage Loan related to REO
Property) as of the date of repurchase, net of the principal portion of any
unreimbursed Monthly Advances made by the purchaser, together with interest at
the applicable Mortgage Interest Rate accrued but unpaid to, but not including,
the first day of the month of repurchase, (b) the appraised value of any related
REO Property, less the good faith estimate of the Depositor of liquidation
expenses to be incurred in connection with its disposal thereof (but not more
than the Outstanding Principal Balance of the related Mortgage Loan, together
with interest at the applicable Mortgage Interest Rate accrued on that balance
but unpaid to, but not including, the first day of the month of repurchase),
such appraisal to be calculated by an appraiser mutually agreed upon by the
Depositor and the Trustee at the expense of the Depositor, (c) unreimbursed
out-of pocket costs of the Master Servicer, including unreimbursed servicing
advances and the principal portion of any unreimbursed Monthly Advances, made on
the Mortgage Loans prior to the exercise of such repurchase right and (d) any
unreimbursed costs and expenses of the Trustee and the Securities Administrator
payable pursuant to Section 9.05 and to the Custodian pursuant to the Custodial
Agreement; or
(ii) the later of the making of the final payment or other
liquidation, or any advance with respect thereto, of the last Mortgage Loan
remaining in the Trust Fund or the disposition of all property acquired with
respect to any Mortgage Loan; provided, however, that in the event that an
advance has been made, but not yet recovered, at the time of such termination,
the Person having made such advance shall be entitled to receive,
notwithstanding such termination, any payments received subsequent thereto with
respect to which such advance was made; or
(iii) the payment to the Certificateholders of all amounts
required to be paid to them pursuant to this Agreement.
(b) In no event, however, shall the portion of the Trust Fund
consisting of a Loan Group created hereby continue beyond the earlier of (i) the
related "latest possible maturity date" specified in Section 5.01(d) or (ii) the
expiration of 21 years from the death of the last survivor of the descendants of
Xxxxxx X. Xxxxxxx, the late Ambassador of the United States to the Court of St.
James's, living on the date of this Agreement.
(c) The right of the Depositor or its designee to repurchase all the
assets of the portion of the Trust Fund relating to a Loan Group as described in
Subsection 10.01(a)(i) above shall be exercisable only if (i) the aggregate
Scheduled Principal Balance of the Mortgage Loans in such Loan Group at the time
of any such repurchase is less than 10% of the Cut-Off Date Balance, or (ii) the
Depositor, based upon an Opinion of Counsel addressed to the Depositor, the
Trustee and the Securities Administrator, has determined that the REMIC status
of REMIC I, REMIC II or REMIC III has been lost or that a substantial risk
exists that such REMIC status will be lost for the then-current taxable year. At
any time thereafter, in the case of (i) or (ii) above, the Depositor may elect
to terminate REMIC I, REMIC II or REMIC III at any time, and upon such election,
the Depositor or its designee, shall repurchase all the assets of the Trust Fund
described in Subsection 10.01(a)(i) above.
(d) Paying Agent shall give notice of any termination to the related
Certificateholders, with a copy to the Master Servicer, the Securities
Administrator, the Trustee and the Rating Agencies, upon which the
Certificateholders shall surrender their Certificates to the Paying Agent for
payment of the final distribution and cancellation. Such notice shall be given
by letter, mailed not earlier than the l5th day and not later than the 25th day
of the month next preceding the month of such final distribution, and shall
specify (i) the Distribution Date upon which final payment of the related
Certificates will be made upon presentation and surrender of the related
Certificates at the office of the Paying Agent 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 related Certificates at the office of the
Paying Agent therein specified.
(e) If the option of the Depositor to repurchase or cause the
repurchase of all the assets in the portion of the Trust Fund relating to a Loan
Group as described in Subsection 10.01(a)(i) above, is exercised, the Depositor
and/or its designee shall deliver to the Paying Agent for deposit in the
Distribution Account, by the Business Day prior to the applicable Distribution
Date, an amount equal to the related Termination Purchase Price. Upon
presentation and surrender of the related Certificates by the related
Certificateholders, the Paying Agent shall distribute to such Certificateholders
as directed by the Securities Administrator in writing an amount determined as
follows: with respect to each related Certificate (other than the Interest Only
Certificates), the outstanding Current Principal Amount, plus with respect to
each such Certificate, one month's interest thereon at the applicable
Pass-Through Rate. If the proceeds with respect to the related Mortgage Loans
are not sufficient to pay all of the related Senior Certificates in full, any
such deficiency shall be allocated first, to the related Subordinate
Certificates, in inverse order of their numerical designations and then to the
related Senior Certificates on a pro rata basis. Upon deposit of the related
Termination Purchase Price and following such final Distribution Date, the
Trustee shall release promptly to the Depositor and/or its designee the related
Mortgage Files for the remaining Mortgage Loans, and the related portions of the
Accounts with respect thereto shall terminate, subject to the Paying Agent's
obligation to hold any amounts payable to the related Certificateholders in
trust without interest pending final distributions pursuant to Subsection
10.01(g). Any other amounts remaining in the Accounts will belong to the
Depositor.
(f) In the event that this Agreement is partially terminated by reason
of the payment or liquidation of the related Mortgage Loans or the disposition
of all property acquired with respect to such Mortgage Loans under Subsection
10.01(a)(ii) above, the Master Servicer shall deliver to the Paying Agent for
deposit in the Distribution Account all related distributable amounts remaining
in the Master Servicer Collection Account. Upon the presentation and surrender
of the related Certificates, the Paying Agent shall distribute to the remaining
related Certificateholders, pursuant to the written direction of the Securities
Administrator and in accordance with their respective interests, all related
distributable amounts remaining in the Distribution Account. Upon deposit by the
Master Servicer of such distributable amounts, and following such final
Distribution Date, the Paying Agent shall release promptly to the Depositor or
its designee the related Mortgage Files for the remaining Mortgage Loans, and
the Master Servicer Collection Account and the Distribution Account shall
terminate with respect to a Loan Group, subject to the Paying Agent's obligation
to hold any amounts payable to the related Certificateholders in trust without
interest pending final distributions pursuant to this Subsection 10.01(f).
(g) If not all of the related Certificateholders shall surrender their
Certificates for cancellation within six months after the time specified in the
above-mentioned written notice, the Paying Agent shall give a second written
notice to the related remaining Certificateholders to surrender their
Certificates for cancellation and receive the final distribution with respect
thereto. If within six months after the second notice, not all the related
Certificates shall have been surrendered for cancellation, the Paying Agent may
take appropriate steps, or appoint any agent to take appropriate steps, to
contact the related remaining Certificateholders concerning surrender of their
Certificates, and the cost thereof shall be paid out of the funds and other
assets which remain subject to this Agreement.
Section 10.02 [Reserved].
Section 10.03 ADDITIONAL TERMINATION REQUIREMENTS WITH RESPECT TO THE
CERTIFICATES.
(a) If the option of the Depositor to repurchase all of the Mortgage
Loans and related properties in a Loan Group under Subsection 10.01(a)(i) above
is exercised, the portion of the Trust Fund and each related REMIC shall be
terminated in accordance with the following additional requirements, unless the
Trustee has been furnished with an Opinion of Counsel addressed to the Trustee
to the effect that the failure of the Trust to comply with the requirements of
this Section 10.02 will not (i) result in the imposition of taxes on "prohibited
transactions" as defined in Section 860F of the Code on any REMIC or (ii) cause
any REMIC to fail to qualify as a REMIC at any time that any regular interests
are outstanding:
(i) within 90 days prior to the final Distribution Date, at
the written direction of the Depositor, the Trustee, as agent for the respective
Tax Matters Persons, shall adopt a plan of complete liquidation of each related
REMIC in the case of a termination under Subsection 10.01(a)(i), provided to it
by the Depositor, which meets the requirements of a "qualified liquidation"
under Section 860F of the Code and any regulations thereunder; and
(ii) the Depositor shall notify the Trustee at the
commencement of such 90-day liquidation period and, at or prior to the time of
making of the final payment on the related Certificates, the Trustee shall sell
or otherwise dispose of all of the remaining assets of the related portion of
the Trust Fund and the related REMIC in accordance with the terms hereof.
(b) By their acceptance of the Class R Certificates, the related
Holders thereof hereby (i) agree to adopt such a plan of complete liquidation of
the related REMIC upon the written request of the Depositor and to take such
action in connection therewith as may be reasonably requested by the Depositor
and (ii) appoint the Depositor as their attorney-in-fact, with full power of
substitution, for purposes of adopting such a plan of complete liquidation. The
Trustee shall adopt such plan of liquidation by filing the appropriate statement
on the final tax return of each related REMIC. Upon complete liquidation or
final distribution of all of the assets of the related portion of the Trust
Fund, the related Trust Fund and REMIC I or REMIC II, as applicable, shall
terminate.
ARTICLE XI
Miscellaneous Provisions
Section 11.01 INTENT OF PARTIES.
The parties intend that each of REMIC I, REMIC II and REMIC III shall
be treated as a REMIC for federal income tax purposes and that the provisions of
this Agreement should be construed in furtherance of this intent.
Section 11.02 AMENDMENT.
(a) This Agreement may be amended from time to time by the Company, the
Depositor, the Master Servicer, the Securities Administrator and the Trustee,
but without notice to or the consent of any of the related Certificateholders,
to cure any ambiguity, to correct or supplement any provisions herein or therein
that may be defective or inconsistent with any other provisions herein or
therein, to comply with any changes in the Code or to make any other provisions
with respect to matters or questions arising under this Agreement which shall
not be inconsistent with the provisions of this Agreement; provided, however,
that such action shall not, as evidenced by an Opinion of Counsel, addressed to
the Trustee, adversely affect in any material respect the interests of any
related Certificateholder (determined without regard to the Policy) or cause any
REMIC to fail to qualify as a REMIC for federal income tax purposes as evidenced
by an Opinion of Counsel addressed to the Trustee but not at the Trustee's
expense.
(b) With respect to the Certificates, this Agreement may also be
amended from time to time by the Company, the Master Servicer, the Depositor,
the Securities Administrator and the Trustee, and the Holders of Certificates
evidencing Fractional Undivided Interests aggregating not less than 51% of the
applicable Class or Classes, if such amendment affects only such Class or
Classes, for the purpose of adding any provisions to or changing in any manner
or eliminating any of the provisions of this Agreement or of modifying in any
manner the rights of the related Certificateholders; provided, however, that no
such amendment shall (i) reduce in any manner the amount of, or delay the timing
of, payments received on Mortgage Loans which are required to be distributed on
any Certificate without the consent of the Holder of such Certificate, (ii)
reduce the aforesaid percentage of Certificates the Holders of which are
required to consent to any such amendment, without the consent of the Holders of
all Certificates then outstanding, or (iii) cause any related REMIC to fail to
qualify as a REMIC for federal income tax purposes, as evidenced by an Opinion
of Counsel addressed to the Trustee which shall be provided to the Trustee other
than at the Trustee's expense. Notwithstanding any other provision of this
Agreement, for purposes of giving or withholding of consents pursuant to this
first paragraph of Section 11.02(b), Certificates registered in the name of or
held for the benefit of the Depositor, the Securities Administrator, the Master
Servicer, or the Trustee or any Affiliate thereof shall be entitled to vote
their Fractional Undivided Interests with respect to matters affecting such
Certificates.
(c) Promptly after the execution of any such amendment, the Trustee
shall furnish a copy of such amendment or written notification of the substance
of such amendment to each related Certificateholder, with a copy to the Rating
Agencies.
(d) In the case of an amendment under the second paragraph of
Subsection 11.02(b) above, it shall not be necessary for the related
Certificateholders to approve the particular form of such an amendment. Rather,
it shall be sufficient if the related Certificateholders approve the substance
of the amendment. The manner of obtaining such consents and of evidencing the
authorization of the execution thereof by related Certificateholders shall be
subject to such reasonable regulations as the Trustee may prescribe.
(e) Prior to the execution of any amendment to this Agreement, the
Trustee shall be entitled to receive and rely upon an Opinion of Counsel
addressed to the Trustee stating that the execution of such amendment is
authorized or permitted by this Agreement. The Trustee and the Securities
Administrator may, but shall not be obligated to, enter into any such amendment
which affects the Trustee's or the Securities Administrator's own respective
rights, duties or immunities under this Agreement.
Section 11.03 RECORDATION OF AGREEMENT.
To the extent permitted by applicable law, this Agreement is subject to
recordation in all appropriate public offices for real property records in all
the counties or other comparable jurisdictions in which any or all of the
Mortgaged Properties are situated, and in any other appropriate public recording
office or elsewhere. The Depositor shall effect such recordation, at the expense
of the Trust upon the request in writing of a Certificateholder, but only if
such direction is accompanied by an Opinion of Counsel (provided at the expense
of the Certificateholder requesting recordation) to the effect that such
recordation would materially and beneficially affect the interests of the
Certificateholders or is required by law.
Section 11.04 LIMITATION ON RIGHTS OF CERTIFICATEHOLDERS.
(a) The death or incapacity of any Certificateholder shall not
terminate this Agreement or the Trust, nor entitle such Certificateholder's
legal representatives or heirs to claim an accounting or to take any action or
proceeding in any court for a partition or winding up of the Trust, nor
otherwise affect the rights, obligations and liabilities of the parties hereto
or any of them.
(b) Except as expressly provided in this Agreement, no
Certificateholders shall have any right to vote or in any manner otherwise
control the operation and management of the Trust, or the obligations of the
parties hereto, nor shall anything herein set forth, or contained in the terms
of the Certificates, be construed so as to establish the Certificateholders from
time to time as partners or members of an association; nor shall any
Certificateholders be under any liability to any third Person by reason of any
action taken by the parties to this Agreement pursuant to any provision hereof.
(c) No Certificateholder shall have any right by virtue of any
provision of this Agreement to institute any suit, action or proceeding in
equity or at law upon, under or with respect to this Agreement against the
Depositor, the Securities Administrator, the Master Servicer or any successor to
any such parties unless (i) such Certificateholder previously shall have given
to the Trustee a written notice of a continuing default, as herein provided,
(ii) the Holders of Certificates evidencing Fractional Undivided Interests
aggregating not less than 51% of the Trust Fund shall have made written request
upon the Trustee to institute such action, suit or proceeding in its own name as
Trustee hereunder and shall have offered to the Trustee such reasonable
indemnity as it may require against the costs and expenses and liabilities to be
incurred therein or thereby, and (iii) the Trustee, for 60 days after its
receipt of such notice, request and offer of indemnity, shall have neglected or
refused to institute any such action, suit or proceeding.
(d) No one or more Certificateholders shall have any right by virtue of
any provision of this Agreement to affect the rights of any other
Certificateholders or to obtain or seek to obtain priority or preference over
any other such Certificateholder, or to enforce any right under this Agreement,
except in the manner herein provided and for the equal, ratable and common
benefit of all Certificateholders. For the protection and enforcement of the
provisions of this Section 11.04, each and every Certificateholder and the
Trustee shall be entitled to such relief as can be given either at law or in
equity.
Section 11.05 ACTS OF CERTIFICATEHOLDERS.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Agreement to be given or taken by
Certificateholders may be embodied in and evidenced by one or more instruments
of substantially similar tenor signed by such Certificateholders in person or by
an agent duly appointed in writing. Except as herein otherwise expressly
provided, such action shall become effective when such instrument or instruments
are delivered to the Trustee and, where it is expressly required, to the
Depositor. Proof of execution of any such instrument or of a writing appointing
any such agent shall be sufficient for any purpose of this Agreement and
conclusive in favor of the Trustee and the Depositor, if made in the manner
provided in this Section 11.05.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his or her individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his or her authority. The fact and date of the execution of any such
instrument or writing, or the authority of the individual executing the same,
may also be proved in any other manner which the Trustee deems sufficient.
(c) The ownership of Certificates (notwithstanding any notation of
ownership or other writing on such Certificates, except an endorsement in
accordance with Section 5.02 made on a Certificate presented in accordance with
Section 5.04) shall be proved by the Certificate Register, and neither the
Trustee, the Securities Administrator, the Depositor, the Master Servicer nor
any successor to any such parties shall be affected by any notice to the
contrary.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other action of the holder of any Certificate shall bind every future
holder of the same Certificate and the holder of every Certificate issued upon
the registration of transfer or exchange thereof, if applicable, or in lieu
thereof with respect to anything done, omitted or suffered to be done by the
Trustee, the Securities Administrator, the Depositor, the Master Servicer or any
successor to any such party in reliance thereon, whether or not notation of such
action is made upon such Certificates.
(e) In determining whether the Holders of the requisite percentage of
Certificates evidencing Fractional Undivided Interests have given any request,
demand, authorization, direction, notice, consent or waiver hereunder,
Certificates owned by the Trustee, the Securities Administrator, the Depositor,
the Master Servicer or any Affiliate thereof shall be disregarded, except as
otherwise provided in Section 11.02(b) and except that, in determining whether
the Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Certificates which a
Responsible Officer of the Trustee actually knows to be so owned shall be so
disregarded. Certificates which have been pledged in good faith to the Trustee,
the Securities Administrator, the Depositor, the Master Servicer or any
Affiliate thereof may be regarded as outstanding if the pledgor establishes to
the satisfaction of the Trustee the pledgor's right to act with respect to such
Certificates and that the pledgor is not an Affiliate of the Trustee, the
Securities Administrator, the Depositor, or the Master Servicer, as the case may
be.
Section 11.06 GOVERNING LAW.
THIS AGREEMENT AND THE CERTIFICATES SHALL BE CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO ITS CONFLICT OF LAWS
RULES (OTHER THAN SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW, WHICH THE
PARTIES HERETO EXPRESSLY RELY UPON IN THE CHOICE OF SUCH LAW AS THE GOVERNING
LAW HEREUNDER) AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER
SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 11.07 NOTICES.
All demands and notices hereunder shall be in writing and shall be
deemed given when delivered at (including delivery by facsimile) or mailed by
registered mail, return receipt requested, postage prepaid, or by recognized
overnight courier, to (i) in the case of the Depositor, 000 Xxxxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attention: Vice President-Servicing, telecopier number:
(000) 000-0000, or to such other address as may hereafter be furnished to the
other parties hereto in writing; (ii) in the case of the Trustee, at its
Corporate Trust Office, or such other address as may hereafter be furnished to
the other parties hereto in writing; (iii) in the case of the Company, 000
Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Vice President-Servicing,
telecopier number: (000) 000-0000, or to such other address as may hereafter be
furnished to the other parties hereto in writing; (iv) in the case of the Master
Servicer, Paying Agent, Certificate Registrar (other than in connection with
presentment of Certificates for transfer, exchange or payment) or Securities
Administrator, Xxxxx Fargo Bank, N.A., X.X. Xxx 00, Xxxxxxxx Xxxxxxxx 00000 (or,
in the case of overnight deliveries, 0000 Xxx Xxxxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxx
21045) (Attention: Corporate Trust Services - Prime 2005-2), facsimile no.:
(000) 000-0000, or such other address as may hereafter be furnished to the other
parties hereto in writing; (v) in the case of the Rating Agencies, Fitch
Ratings, Xxx Xxxxx Xxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: ABS
Monitoring Department, and Standard & Poor's, a division of The XxXxxx-Xxxx
Companies, Inc., 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, or such other
address as may be hereafter furnished to the Depositor, Trustee and Master
Servicer in writing by Fitch. Any notice delivered to the Depositor, the Master
Servicer, the Securities Administrator or the Trustee under this Agreement shall
be effective only upon receipt. Any notice required or permitted to be mailed to
a Certificateholder, unless otherwise provided herein, shall be given by
first-class mail, postage prepaid, at the address of such Certificateholder as
shown in the Certificate Register. Any notice so mailed within the time
prescribed in this Agreement shall be conclusively presumed to have been duly
given when mailed, whether or not the Certificateholder receives such notice.
Section 11.08 SEVERABILITY OF PROVISIONS.
If any one or more of the covenants, agreements, provisions or terms of
this Agreement shall be for any reason whatsoever held invalid, then such
covenants, agreements, provisions or terms shall be deemed severed from the
remaining covenants, agreements, provisions or terms of this Agreement and shall
in no way affect the validity or enforceability of the other provisions of this
Agreement or of the Certificates or the rights of the holders thereof.
Section 11.09 SUCCESSORS AND ASSIGNS.
The provisions of this Agreement shall be binding upon and inure to the
benefit of the respective successors and assigns of the parties hereto.
Section 11.10 ARTICLE AND SECTION HEADINGS.
The article and section headings herein are for convenience of
reference only, and shall not limit or otherwise affect the meaning hereof.
Section 11.11 COUNTERPARTS.
This Agreement may be executed in two or more counterparts each of
which when so executed and delivered shall be an original but all of which
together shall constitute one and the same instrument.
Section 11.12 NOTICE TO RATING AGENCIES.
The article and section headings herein are for convenience of
reference only, and shall not limited or otherwise affect the meaning hereof.
The Trustee shall promptly provide notice to each Rating Agency with respect to
each of the following of which a Responsible Officer of the Trustee has actual
knowledge:
1. Any material change or amendment to this Agreement or the Servicing
Agreements;
2. The occurrence of any Event of Default that has not been cured;
3. The resignation or termination of the Master Servicer, the Trustee
or the Securities Administrator;
4. The repurchase or substitution of Mortgage Loans;
5. The final payment to Certificateholders; and
6. Any change in the location of the Master Servicer Collection Account
or the Distribution Account.
IN WITNESS WHEREOF, the Depositor, the Trustee, the Master Servicer and
the Securities Administrator and EMC have caused their names to be signed hereto
by their respective officers thereunto duly authorized as of the day and year
first above written.
STRUCTURED ASSET MORTGAGE INVESTMENTS
II INC., as Depositor
By: /s/ Xxxxx Xxxxxxxxxxx
------------------------------------
Name: Xxxxx Xxxxxxxxxxx
Title: Vice President
U.S. BANK NATIONAL ASSOCIATION, as
Trustee
By: /s/ Xxxxxx X. Xxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President
XXXXX FARGO BANK, N.A., as Master
Servicer
By: /s/ Xxxxxx Xxxxxx
------------------------------------
Name: Xxxxxx Xxxxxx
Title: Assistant Vice President
XXXXX FARGO BANK, N.A., as Securities
Administrator
By:
------------------------------------
Name: Xxxxxx Xxxxxx
Title: Assistant Vice President
EMC MORTGAGE CORPORATION
By: /s/ Xxxx Xxxxxxx
------------------------------------
Name: Xxxx Xxxxxxx
Title: Senior Vice President
Accepted and Agreed as to
Sections 2.01, 2.02, 2.03, 2.04 and 9.09(c)
in its capacity as Seller
EMC MORTGAGE CORPORATION
By: /s/ Xxxx Xxxxxxx
-------------------------------
Name: Xxxx Xxxxxxx
Title: Senior Vice President
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the 30th day of June, 2005 before me, a notary public in and for
said State, personally appeared Xxxxx Xxxxxxxxxxx, known to me to be a Vice
President of Structured Asset Mortgage Investments II Inc., the corporation that
executed the within instrument, and also known to me to be the person who
executed it on behalf of said corporation, and acknowledged to me that such
corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
------------------------------------
Notary Public
[Notarial Seal]
STATE OF )
) ss.:
COUNTY OF )
On the 30th day of June, 2005 before me, a notary public in and for
said State, personally appeared ____________, known to me to be a ____________
of U.S. Bank National Association, the entity that executed the within
instrument, and also known to me to be the person who executed it on behalf of
said entity, and acknowledged to me that such entity executed the within
instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
------------------------------------
Notary Public
[Notarial Seal]
STATE OF MARYLAND )
) ss.:
COUNTY OF XXXXXX )
On the 30th day of June, 2005 before me, a notary public in and for
said State, personally appeared Xxxxxx Xxxxxx, known to me to be an Assistant
Vice President of Xxxxx Fargo Bank, N.A., the entity that executed the within
instrument, and also known to me to be the person who executed it on behalf of
said entity, and acknowledged to me that such entity executed the within
instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
------------------------------------
Notary Public
[Notarial Seal]
STATE OF MARYLAND )
) ss.:
COUNTY OF XXXXXX )
On the 30th day of June, 2005 before me, a notary public in and for
said State, personally appeared ____________, known to me to be a(n)
____________ of Xxxxx Fargo Bank, N.A., the entity that executed the within
instrument, and also known to me to be the person who executed it on behalf of
said entity, and acknowledged to me that such entity executed the within
instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
------------------------------------
Notary Public
[Notarial Seal]
STATE OF TEXAS )
) ss.:
COUNTY OF DALLAS )
On the 30th day of June, 2005 before me, a notary public in and for
said State, personally appeared Xxxx Xxxxxxx, known to me to be a Senior Vice
President of EMC Mortgage Corporation, the corporation that executed the within
instrument, and also known to me to be the person who executed it on behalf of
said corporation, and acknowledged to me that such corporation executed the
within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
------------------------------------
Notary Public
[Notarial Seal]
STATE OF TEXAS )
) ss.:
COUNTY OF DALLAS )
On the 30th day of June, 2005 before me, a notary public in and for
said State, personally appeared ____________, known to me to be ____________ of
EMC Mortgage Corporation, the corporation that executed the within instrument,
and also known to me to be the person who executed it on behalf of said
corporation, and acknowledged to me that such corporation executed the within
instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
------------------------------------
Notary Public
[Notarial Seal]
EXHIBIT A-1
FORM OF CLASS [_]-A-[_] CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE
IS A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
[THE CURRENT PRINCIPAL AMOUNT OF THIS CERTIFICATE WILL BE
DECREASED BY THE PRINCIPAL PAYMENTS HEREON AND REALIZED LOSSES ALLOCABLE HERETO.
ACCORDINGLY, FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE CURRENT
PRINCIPAL AMOUNT OF THIS CERTIFICATE WILL BE DIFFERENT FROM THE DENOMINATION
SHOWN BELOW. ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT
PRINCIPAL AMOUNT BY INQUIRY OF THE TRUSTEE NAMED HEREIN.]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY TO THE TRUSTEE OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED WILL
BE REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT WILL
BE MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN.
Certificate No.1 [Adjustable][Fixed][Variable]Pass-Through Rate
Class [_]-[A]-[_] Senior
Date of Pooling and Servicing Agreement Aggregate Initial [Current Principal][Notional] Amount
and Cut-off Date: of this Senior Certificate as of the Cut-off Date:
June 1, 2005 $[_________________]
First Distribution Date: Initial [Current Principal][Notional] Amount of this
July 25, 2005 Senior Certificate as of the Cut-off Date:
$[_________________]
Master Servicer: CUSIP: [____________]
Xxxxx Fargo Bank, National Association
Assumed Final Distribution Date:
[___________]
PRIME MORTGAGE TRUST 2005-2
MORTGAGE PASS-THROUGH CERTIFICATE
SERIES 2005-2
evidencing a fractional undivided interest in the distributions
allocable to the Class [_]-[A]-[_] Certificates with respect to a
portion of a Trust Fund consisting primarily of a pool of fixed rate
mortgage loans secured by first liens on one-to-four family residential
properties sold by STRUCTURED ASSET MORTGAGE INVESTMENTS II INC.
This Certificate is payable solely from the assets of the
Trust Fund, and does not represent an obligation of or interest in Structured
Asset Mortgage Investments II Inc., the Master Servicer or the Trustee referred
to below or any of their affiliates or any other person. Neither this
Certificate nor the underlying Mortgage Loans are guaranteed or insured by any
governmental entity or by Structured Asset Mortgage Investments II Inc., the
Master Servicer or the Trustee or any of their affiliates or any other person.
None of Structured Asset Mortgage Investments II Inc., the Master Servicer or
any of their affiliates will have any obligation with respect to any certificate
or other obligation secured by or payable from payments on the Certificates.
This certifies that Cede & Co. is the registered owner of the
Fractional Undivided Interest evidenced hereby in the beneficial ownership
interest of Certificates of the same Class as this Certificate in a portion of a
trust (the "Trust Fund") primarily consisting of fixed rate mortgage loans
secured by first liens on one- to four- family residential properties
(collectively, the "Mortgage Loans") sold by Structured Asset Mortgage
Investments II Inc. ("XXXX XX"). The Mortgage Loans were sold by EMC Mortgage
Corporation ("EMC") to XXXX XX. Xxxxx Fargo Bank, National Association ("Xxxxx
Fargo") will act as master servicer of the Mortgage Loans (the "Master
Servicer", which term includes any successors thereto under the Agreement
referred to below). The Trust Fund was created pursuant to the Pooling and
Servicing Agreement dated as of the Cut-off Date specified above (the
"Agreement"), among EMC Mortgage Corporation, as seller and company (the
"Seller"), XXXX XX, as depositor (the "Depositor"), Xxxxx Fargo Bank, National
Association as master servicer and securities administrator (in such capacity,
the "Securities Administrator") and U.S. Bank National Association as trustee
(the "Trustee"), a summary of certain of the pertinent provisions of which is
set forth hereafter. To the extent not defined herein, capitalized terms used
herein shall have the meaning ascribed to them in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of its acceptance hereof assents and by which such Holder is bound.
[[Interest on this Certificate will accrue during the month
prior to the month in which a Distribution Date (as hereinafter defined) occurs
on the Current Principal Amount hereof at a per annum rate equal to the
Pass-Through Rate set forth above and as further described in the Agreement.]
The Trustee will distribute on the 25th day of each month, or, if such 25th day
is not a Business Day, the immediately following Business Day (each, a
"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 calendar month preceding the month of
such Distribution Date, an amount equal to the product of the Fractional
Undivided Interest evidenced by this Certificate and the amount [(of interest
and] principal[, if any)] required to be distributed to the Holders of
Certificates of the same Class as this Certificate. The Assumed Final
Distribution Date is the Distribution Date in the month immediately following
the month of the latest scheduled maturity date of any Mortgage Loan and is not
likely to be the date on which the Current Principal Amount of this Class of
Certificates will be reduced to zero.]
[Interest on this Certificate will accrue from and including
the 25th day of the calendar month preceding the month in which a Distribution
Date (as hereinafter defined) occurs (or, with respect to the first accrual
period, the Closing Date) to and including the 24th day of the calendar month in
which that Distribution Date occurs on the [Current Principal][Notional] Amount
hereof at a per annum rate equal to the Pass-Through Rate set forth above and as
further described in the Agreement. The Trustee will distribute on the 25th day
of each month, or, if such 25th day is not a Business Day, the immediately
following Business Day (each, a "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 Business Day immediately preceding
such Distribution Date, an amount equal to the product of the Fractional
Undivided Interest evidenced by this Certificate and the amount (of interest and
principal, if any) required to be distributed to the Holders of Certificates of
the same Class as this Certificate. The Assumed Final Distribution Date is the
Distribution Date in the month immediately following the month of the latest
scheduled maturity date of any Mortgage Loan and is not likely to be the date on
which the [Current Principal][Notional] Amount of this Class of Certificates
will be reduced to zero.]
Distributions on this Certificate will be made by the Trustee
by check mailed to the address of the Person entitled thereto as such name and
address shall appear on the Certificate Register or, if such Person so requests
by notifying the Trustee in writing as specified in the Agreement by wire
transfer. Notwithstanding the above, the final distribution on this Certificate
will be made after due notice by the Trustee of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Trustee for that purpose and designated in
such notice. The Initial [Current Principal][Notional] Amount of this
Certificate is set forth above. [The Current Principal Amount hereof will be
reduced to the extent of distributions allocable to principal hereon and any
Realized Losses allocable hereto.]
This Certificate is one of a duly authorized issue of
Certificates designated as set forth on the face hereof (the "Certificates").
The Certificates, in the aggregate, evidence the entire beneficial ownership
interest in the Trust Fund formed pursuant to the Agreement.
The Certificateholder, by its acceptance of this Certificate,
agrees that it will look solely to the Trust Fund for payment hereunder and that
the Trustee is not liable to the Certificateholders for any amount payable under
this Certificate or the Agreement or, except as expressly provided in the
Agreement, subject to any liability under the Agreement.
This Certificate does not purport to summarize the Agreement
and reference is made to the Agreement for the interests, rights and limitations
of rights, benefits, obligations and duties evidenced hereby, and the rights,
duties and immunities of the Trustee.
The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Master Servicer and the Trustee and the rights
of the Certificateholders under the Agreement from time to time by the parties
thereto with the consent of the Holders of Certificates, and with the consent of
the Insurer with respect to amendments related to the Mortgage Pass-Through
Certificates, evidencing Fractional Undivided Interests aggregating not less
than 51% of the portion of the Trust Fund related to such Certificates (or in
certain cases, Holders of Certificates of affected Classes evidencing such
percentage of the Fractional Undivided Interests thereof). 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 lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates.
As provided in the Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is registrable
with the Trustee upon surrender of this Certificate for registration of transfer
at the offices or agencies maintained by the Trustee for such purposes, duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Trustee duly executed by the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
in authorized denominations representing a like aggregate Fractional Undivided
Interest will be issued to the designated transferee.
The Certificates are issuable only as registered Certificates
without coupons in the Classes and denominations specified in the Agreement. As
provided in the Agreement and subject to certain limitations therein set forth,
this Certificate is exchangeable for one or more new Certificates evidencing the
same Class and in the same aggregate Fractional Undivided Interest, as requested
by the Holder surrendering the same.
No service charge will be made to the Certificateholders for
any such registration of transfer, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Depositor, the Master Servicer, 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 none of the Depositor, the Master Servicer,
the Trustee or any such agent shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund
created thereby (other than the obligations to make payments to
Certificateholders with respect to the termination of the Agreement) shall
terminate upon the earlier of (i) the later of the (A) final payment or other
liquidation (or Advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund and (B) disposition of all property acquired upon
foreclosure or deed in lieu of foreclosure of any Mortgage Loan and the
remittance of all funds due under the Agreement, or (ii) the optional repurchase
by the party named in the Agreement of all the Mortgage Loans and other assets
of the Trust Fund in accordance with the terms of the Agreement. Such optional
repurchase may be made only on or after the Distribution Date on which the
aggregate unpaid principal balance of the Mortgage Loans is less than the
percentage of the aggregate Outstanding Principal Balance specified in the
Agreement of the Mortgage Loans at the Cut-off Date. The exercise of such right
will effect the early retirement of the Certificates. In no event, however, will
the Trust Fund created by the Agreement continue beyond the earlier of (i) the
"latest possible maturity date" specified in Section 5.01(d) of the Agreement or
(ii) the expiration of 21 years after the death of certain persons identified in
the Agreement.
Unless this Certificate has been countersigned by an
authorized signatory of the Trustee by manual signature, this Certificate shall
not be entitled to any benefit under the Agreement, or be valid for any purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused
this Certificate to be duly executed.
Dated: June 30, 2005 XXXXX FARGO BANK,
NATIONAL ASSOCIATION,
Not in its individual capacity but solely as
Securities Administrator
By:
----------------------------------------
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the
within-mentioned Agreement.
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
Authorized signatory of Xxxxx Fargo Bank,
National Association, not in its individual
capacity but solely as Securities
Administrator
By: ----------------------------------------
Authorized Signatory
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto __________________________________ (Please print or
typewrite name and address including postal zip code of assignee) a Fractional
Undivided Interest evidenced by the within Mortgage Pass-Through Certificate and
hereby authorizes the transfer of registration of such interest to assignee on
the Certificate Register of the Trust Fund.
I (We) further direct the Certificate Registrar to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Dated:
---------------------------------------------
Signature by or on behalf of assignor
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________ for the account
of _________________________ account number _____________, or, if mailed by
check, to ______________________________. Applicable statements should be mailed
to ____________________________________________________________________________.
This information is provided by __________________, the
assignee named above, or ________________________, as its agent.
EXHIBIT A-2
FORM OF CLASS [_]-B-[_] CERTIFICATE
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE
SENIOR CERTIFICATES, [AND THE CLASS [_]-B-[_] CERTIFICATES] , AS DESCRIBED IN
THE AGREEMENT (AS DEFINED BELOW).
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE
IS A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
THE CURRENT PRINCIPAL AMOUNT OF THIS CERTIFICATE WILL BE
DECREASED BY THE PRINCIPAL PAYMENTS HEREON AND ANY REALIZED LOSSES ALLOCABLE
HERETO. ACCORDINGLY, FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE
CURRENT PRINCIPAL AMOUNT OF THIS CERTIFICATE WILL BE DIFFERENT FROM THE
DENOMINATION SHOWN BELOW. ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS
CURRENT PRINCIPAL AMOUNT BY INQUIRY OF THE TRUSTEE NAMED HEREIN.
[FOR CLASS I-B-1, CLASS I-B-2, CLASS I-B-3, CLASS II-B-1,
CLASS II-B-2 AND CLASS I-B-3] [UNLESS THIS CERTIFICATE IS PRESENTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED WILL BE REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND
ANY PAYMENT WILL BE MADE TO CEDE & CO. ANY TRANSFER, PLEDGE OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]
[FOR CLASS I-B-1, CLASS I-B-2, CLASS I-B-3, CLASS II-B-1,
CLASS II-B-2 AND CLASS I-B-3] [EACH BENEFICIAL OWNER OF THIS CERTIFICATE OR ANY
INTEREST HEREIN SHALL BE DEEMED TO HAVE REPRESENTED, BY VIRTUE OF ITS
ACQUISITION OR HOLDING OF THIS CERTIFICATE OR INTEREST HEREIN, THAT EITHER (I)
IT IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED ("PLAN"), OR INVESTING WITH ASSETS OF A PLAN OR (II) IT HAS
ACQUIRED AND IS HOLDING SUCH CERTIFICATE IN RELIANCE ON PROHIBITED TRANSACTION
EXEMPTION 90-30, AS AMENDED FROM TIME TO TIME ("EXEMPTION"), AND THAT IT
UNDERSTANDS THAT THERE ARE CERTAIN CONDITIONS TO THE AVAILABILITY OF THE
EXEMPTION, INCLUDING THAT THE CERTIFICATE MUST BE RATED, AT THE TIME OF
PURCHASE, NOT LOWER THAN "BBB-" (OR ITS EQUIVALENT) BY STANDARD & POOR'S, FITCH,
INC. OR XXXXX'X INVESTORS SERVICE, INC., AND THE CERTIFICATE IS SO RATED OR
(III) (1) IT IS AN INSURANCE COMPANY, (2) THE SOURCE OF FUNDS USED TO ACQUIRE OR
HOLD THE CERTIFICATE OR INTEREST HEREIN IS AN "INSURANCE COMPANY GENERAL
ACCOUNT", AS SUCH TERM IS DEFINED IN PROHIBITED TRANSACTION CLASS EXEMPTION
("PTCE") 95-60, AND (3) THE CONDITIONS IN SECTIONS I AND III OF PTCE 95-60 HAVE
BEEN SATISFIED.]
[FOR CLASS I-B-4, CLASS I-B-5, CLASS I-B-6, CLASS II-B-4,
CLASS II-B-5 AND CLASS I-B-6][THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR UNDER ANY STATE SECURITIES LAWS. THE HOLDER HEREOF, BY PURCHASING THIS
CERTIFICATE, AGREES THAT THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR
OTHERWISE TRANSFERRED ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER
APPLICABLE LAWS AND ONLY (1) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT
("RULE 144A") TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A (A "QIB"), PURCHASING FOR
ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER
HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER
IS BEING MADE IN RELIANCE ON RULE 144A, (2) PURSUANT TO AN EXEMPTION FROM
REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE) OR (3)
IN CERTIFICATED FORM TO AN "INSTITUTIONAL ACCREDITED INVESTOR" WITHIN THE
MEANING THEREOF IN RULE 501(A)(1), (2), (3) OR (7) OF REGULATION D UNDER THE ACT
OR ANY ENTITY IN WHICH ALL OF THE EQUITY OWNERS COME WITHIN SUCH PARAGRAPHS
PURCHASING NOT FOR DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, SUBJECT TO
(A) THE RECEIPT BY THE TRUSTEE OF A LETTER SUBSTANTIALLY IN THE FORM PROVIDED IN
THE AGREEMENT AND (B) THE RECEIPT BY THE TRUSTEE OF SUCH OTHER EVIDENCE
ACCEPTABLE TO THE TRUSTEE THAT SUCH REOFFER, RESALE, PLEDGE OR TRANSFER IS IN
COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS OR IN EACH CASE IN
ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES AND ANY
OTHER APPLICABLE JURISDICTION.]
[FOR CLASS I-B-4, CLASS I-B-5, CLASS I-B-6, CLASS II-B-4,
CLASS II-B-5 AND CLASS I-B-6] [THIS CERTIFICATE MAY NOT BE ACQUIRED DIRECTLY OR
INDIRECTLY BY, OR ON BEHALF OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT WHICH IS SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED, OR SECTION 4975 OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED, UNLESS THE TRANSFEREE CERTIFIES OR REPRESENTS THAT THE
PROPOSED TRANSFER AND HOLDING OF A CERTIFICATE AND THE SERVICING, MANAGEMENT AND
OPERATION OF THE TRUST AND ITS ASSETS: (I) WILL NOT RESULT IN ANY PROHIBITED
TRANSACTION WHICH IS NOT COVERED UNDER AN INDIVIDUAL OR CLASS PROHIBITED
TRANSACTION EXEMPTION, INCLUDING, BUT NOT LIMITED TO, PROHIBITED TRANSACTION
EXEMPTION ("PTE") 84-14, XXX 00-00, XXX 00-0, XXX 95-60 OR PTE 96-23 AND (II)
WILL NOT GIVE RISE TO ANY ADDITIONAL OBLIGATIONS ON THE PART OF THE DEPOSITOR,
THE SECURITIES ADMINISTRATOR, THE MASTER SERVICER OR THE TRUSTEE, WHICH WILL BE
DEEMED REPRESENTED BY AN OWNER OF A BOOK-ENTRY CERTIFICATE OR A GLOBAL
CERTIFICATE OR UNLESS THE OPINION SPECIFIED IN SECTION 5.07 OF THE AGREEMENT IS
PROVIDED.]
Certificate No.1 Pass-Through Rate: ____%
Class [_]-B-[_] Subordinate
Date of Pooling and Servicing Agreement Aggregate Initial Current Principal Amount of this
and Cut-off Date: Subordinate Certificate as of the Cut-off Date:
June 1, 2005 $[______________]
First Distribution Date: Initial Current Principal Amount of this Subordinate
July 25, 2005 Certificate as of the Cut-off Date: $[_________]
Master Servicer: CUSIP: [____________]
Xxxxx Fargo Bank, National Association
Assumed Final Distribution Date:
[_______________]
PRIME MORTGAGE TRUST 2005-2
MORTGAGE PASS-THROUGH CERTIFICATE
SERIES 2005-2
evidencing a fractional undivided interest in the distributions
allocable to the Class [_]-B-[_] Certificates with respect to a portion
of a Trust Fund consisting primarily of a pool of fixed rate mortgage
loans secured by first liens on one-to-four family residential
properties sold by STRUCTURED ASSET MORTGAGE INVESTMENTS II INC.
This Certificate is payable solely from the assets of the
Trust Fund, and does not represent an obligation of or interest in Structured
Asset Mortgage Investments II Inc., the Master Servicer or the Trustee referred
to below or any of their affiliates or any other person. Neither this
Certificate nor the underlying Mortgage Loans are guaranteed or insured by any
governmental entity or by Structured Asset Mortgage Investments II Inc., the
Master Servicer or the Trustee or any of their affiliates or any other person.
None of Structured Asset Mortgage Investments II Inc., the Master Servicer or
any of their affiliates will have any obligation with respect to any certificate
or other obligation secured by or payable from payments on the Certificates.
This certifies that [_______] is the registered owner of the
Fractional Undivided Interest evidenced hereby in the beneficial ownership
interest of Certificates of the same Class as this Certificate in a portion of a
trust (the "Trust Fund") primarily consisting of fixed rate mortgage loans
secured by first liens on one- to four- family residential properties
(collectively, the "Mortgage Loans") sold by Structured Asset Mortgage
Investments II Inc. ("XXXX XX"). The Mortgage Loans were sold by EMC Mortgage
Corporation ("EMC") to XXXX XX. Xxxxx Fargo Bank, National Association ("Xxxxx
Fargo") will act as master servicer of the Mortgage Loans (the "Master
Servicer", which term includes any successors thereto under the Agreement
referred to below). The Trust Fund was created pursuant to the Pooling and
Servicing Agreement dated as of the Cut-off Date specified above (the
"Agreement"), among EMC as seller and company (the "Seller"), XXXX XX, as
depositor (the "Depositor"), Xxxxx Fargo Bank, National Association as master
servicer and securities administrator (in such capacity, the "Securities
Administrator"), and U.S. Bank National Association as trustee (the "Trustee"),
a summary of certain of the pertinent provisions of which is set forth
hereafter. To the extent not defined herein, capitalized terms used herein shall
have the meaning ascribed to them in the Agreement. This Certificate is issued
under and is subject to the terms, provisions and conditions of the Agreement,
to which Agreement the Holder of this Certificate by virtue of its acceptance
hereof assents and by which such Holder is bound.
Interest on this Certificate will accrue during the month
prior to the month in which a Distribution Date (as hereinafter defined) occurs
on the Current Principal Amount hereof at a per annum rate equal to the
Pass-Through Rate set forth above and as further described in the Agreement. The
Trustee will distribute on the 25th day of each month, or, if such 25th day is
not a Business Day, the immediately following Business Day (each, a
"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 calendar month preceding the month of
such Distribution Date, an amount equal to the product of the Fractional
Undivided Interest evidenced by this Certificate and the amount (of interest and
principal, if any) required to be distributed to the Holders of Certificates of
the same Class as this Certificate. The Assumed Final Distribution Date is the
Distribution Date in the month immediately following the month of the latest
scheduled maturity date of any Mortgage Loan and is not likely to be the date on
which the Current Principal Amount of this Class of Certificates will be reduced
to zero.
Distributions on this Certificate will be made by the Trustee
by check mailed to the address of the Person entitled thereto as such name and
address shall appear on the Certificate Register or, if such Person so requests
by notifying the Trustee in writing as specified in the Agreement by wire
transfer. Notwithstanding the above, the final distribution on this Certificate
will be made after due notice by the Trustee of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Trustee for that purpose and designated in
such notice. The Initial Current Principal Amount of this Certificate is set
forth above. The Current Principal Amount hereof will be reduced to the extent
of distributions allocable to principal hereon and any Realized Losses allocable
hereto.
[For Class I-B-4, Class I-B-5, Class I-B-6, Class II-B-4,
Class II-B-5 and Class I-B-6][No transfer of this Class [_]-B-[_] Certificate
will be made unless such transfer is (i) exempt from the registration
requirements of the Securities act of 1933, as amended, and any applicable state
securities laws or is made in accordance with said Act and laws and (ii) made in
accordance with Section 5.02 of the Agreement. In the event that such transfer
is to be made the Trustee shall register such transfer if, (i) made to a
transferee who has provided the Trustee with evidence as to its QIB status; or
(ii) (A) the transferor has advised the Trustee in writing that the Certificate
is being transferred to an Institutional Accredited Investor and (B) prior to
such transfer the transferee furnishes to the Trustee an Investment Letter;
provided that if based upon an Opinion of Counsel to the effect that (A) and (B)
above are met sufficient to confirm that such transfer is being made pursuant to
an exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act and other applicable laws.]
[For Class I-B-1, Class I-B-2, Class I-B-3, Class II-B-1,
Class II-B-2 and Class I-B-3][Each beneficial owner of this Certificate or any
interest herein shall be deemed to have represented, by virtue of its
acquisition or holding of this certificate or interest herein, that either (i)
it is not an employee benefit plan subject to the Employee Retirement Income
Security Act of 1974, as amended or section 4975 of the Internal Revenue Code of
1986, as amended ("Plan"), or investing with assets of a Plan or (ii) it has
acquired and is holding such certificate in reliance on Prohibited Transaction
Exemption 90-30, as amended from time to time ("Exemption"), and that it
understands that there are certain conditions to the availability of the
Exemption, including that the certificate must be rated, at the time of
purchase, not lower than "BBB-" (or its equivalent) by Standard & Poor's, Fitch,
Inc. or Xxxxx'x Investors Service, Inc., and the certificate is so rated or
(iii) (1) it is an insurance company, (2) the source of funds used to acquire or
hold the certificate or interest therein is an "insurance company general
account", as such term is defined in Prohibited Transaction Class Exemption
("PTCE") 95-60, and (3) the conditions in Sections I and III of PTCE 95-60 have
been satisfied.]
[For Class I-B-4, Class I-B-5, Class I-B-6, Class II-B-4,
Class II-B-5 and Class I-B-6][This Certificate may not be acquired directly or
indirectly by, or on behalf of, an employee benefit plan or other retirement
arrangement which is subject to Title I of the Employee Retirement Income
Security Act of 1974, as amended, or Section 4975 of the Internal Revenue Code
of 1986, as amended, unless the transferee certifies or represents that the
proposed transfer and holding of a Certificate and the servicing, management and
operation of the trust and its assets: (i) will not result in any prohibited
transaction which is not covered under an individual or class prohibited
transaction exemption, including, but not limited to, Prohibited Transaction
Exemption ("PTE") 84-14, XXX 00-00, XXX 00-0, XXX 00-00 or PTE 96-23 and (ii)
will not give rise to any additional obligations on the part of the Depositor,
the Securities Administrator, the Master Servicer or the Trustee, which will be
deemed represented by an owner of a Book-Entry Certificate or a Global
Certificate or unless the opinion specified in section 5.07 of the Agreement is
provided.]
This Certificate is one of a duly authorized issue of
Certificates designated as set forth on the face hereof (the "Certificates").
The Certificates, in the aggregate, evidence the entire beneficial ownership
interest in the Trust Fund formed pursuant to the Agreement.
The Certificateholder, by its acceptance of this Certificate,
agrees that it will look solely to the Trust Fund for payment hereunder and that
the Trustee is not liable to the Certificateholders for any amount payable under
this Certificate or the Agreement or, except as expressly provided in the
Agreement, subject to any liability under the Agreement.
This Certificate does not purport to summarize the Agreement
and reference is made to the Agreement for the interests, rights and limitations
of rights, benefits, obligations and duties evidenced hereby, and the rights,
duties and immunities of the Trustee.
The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Master Servicer and the Trustee and the rights
of the Certificateholders under the Agreement from time to time by the parties
thereto with the consent of the Holders of Certificates, and with the consent of
the Insurer with respect to amendments related to the Mortgage Pass-Through
Certificates, evidencing Fractional Undivided Interests aggregating not less
than 51% of the portion of the Trust Fund related to such Certificates (or in
certain cases, Holders of Certificates of affected Classes evidencing such
percentage of the Fractional Undivided Interests thereof). 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 lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates.
As provided in the Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is registrable
with the Trustee upon surrender of this Certificate for registration of transfer
at the offices or agencies maintained by the Trustee for such purposes, duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Trustee duly executed by the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
in authorized denominations representing a like aggregate Fractional Undivided
Interest will be issued to the designated transferee.
The Certificates are issuable only as registered Certificates
without coupons in the Classes and denominations specified in the Agreement. As
provided in the Agreement and subject to certain limitations therein set forth,
this Certificate is exchangeable for one or more new Certificates evidencing the
same Class and in the same aggregate Fractional Undivided Interest, as requested
by the Holder surrendering the same.
No service charge will be made to the Certificateholders for
any such registration of transfer, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Depositor, the Master Servicer, 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 none of the Depositor, the Master Servicer,
the Trustee or any such agent shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund
created thereby (other than the obligations to make payments to
Certificateholders with respect to the termination of the Agreement) shall
terminate upon the earlier of (i) the later of the (A) final payment or other
liquidation (or Advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund and (B) disposition of all property acquired upon
foreclosure or deed in lieu of foreclosure of any Mortgage Loan and the
remittance of all funds due under the Agreement, or (ii) the optional repurchase
by the party named in the Agreement of all the Mortgage Loans and other assets
of the Trust Fund in accordance with the terms of the Agreement. Such optional
repurchase may be made only on or after the Distribution Date on which the
aggregate unpaid principal balance of the Mortgage Loans is less than the
percentage of the aggregate Outstanding Principal Balance specified in the
Agreement of the Mortgage Loans at the Cut-off Date. The exercise of such right
will effect the early retirement of the Certificates. In no event, however, will
the Trust Fund created by the Agreement continue beyond the earlier of (i) the
"latest possible maturity date" specified in Section 5.01(d) of the Agreement or
(ii) the expiration of 21 years after the death of certain persons identified in
the Agreement.
Unless this Certificate has been countersigned by an
authorized signatory of the Trustee by manual signature, this Certificate shall
not be entitled to any benefit under the Agreement, or be valid for any purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused
this Certificate to be duly executed.
Dated: June 30, 2005 XXXXX FARGO BANK,
NATIONAL ASSOCIATION,
Not in its individual capacity but solely as
Securities Administrator
By:
----------------------------------------
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the
within-mentioned Agreement.
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
Authorized signatory of Xxxxx Fargo Bank,
National Association, not in its individual
capacity but solely as Securities
Administrator
By:
----------------------------------------
Authorized Signatory
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto __________________________________ (Please print or
typewrite name and address including postal zip code of assignee) a Fractional
Undivided Interest evidenced by the within Mortgage Pass-Through Certificate and
hereby authorizes the transfer of registration of such interest to assignee on
the Certificate Register of the Trust Fund.
I (We) further direct the Certificate Registrar to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:
Dated:
---------------------------------------------
Signature by or on behalf of assignor
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________ for the account
of _________________________ account number _____________, or, if mailed by
check, to ______________________________. Applicable statements should be mailed
to ______________________________________________ .
This information is provided by __________________, the
assignee named above, or ________________________, as its agent.
EXHIBIT A-3
FORM OF CLASS I-PO CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE
IS A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
THE CURRENT PRINCIPAL AMOUNT OF THIS CERTIFICATE WILL BE
DECREASED BY THE PRINCIPAL PAYMENTS HEREON AND REALIZED LOSSES ALLOCABLE HERETO.
ACCORDINGLY, FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE CURRENT
PRINCIPAL AMOUNT OF THIS CERTIFICATE WILL BE DIFFERENT FROM THE DENOMINATION
SHOWN BELOW. ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT
PRINCIPAL AMOUNT BY INQUIRY OF THE TRUSTEE NAMED HEREIN.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY TO THE TRUSTEE OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED WILL
BE REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT WILL
BE MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN.
Certificate No.1 Pass-Through Rate: 0.000%
Class I- PO Senior
Date of Pooling and Servicing Agreement Aggregate Initial Current Principal Amount of this
and Cut-off Date: Senior Certificate as of the Cut-off Date:
June 1, 2005 $[______________]
First Distribution Date: Initial Current Principal Amount of this Senior
July 25, 2005 Certificate as of the Cut-off Date: $[_____________]
Master Servicer: CUSIP: [____________]
Xxxxx Fargo Bank, National Association
Assumed Final Distribution Date:
[_____________]
PRIME MORTGAGE TRUST 2005-2
MORTGAGE PASS-THROUGH CERTIFICATE
SERIES 2005-2
evidencing a fractional undivided interest in the distributions
allocable to the Class I-PO Certificates with respect to a portion of a
Trust Fund consisting primarily of a pool of fixed rate mortgage loans
secured by first liens on one-to-four family residential properties
sold by STRUCTURED ASSET MORTGAGE INVESTMENTS II INC.
This Certificate is payable solely from the assets of the
Trust Fund, and does not represent an obligation of or interest in Structured
Asset Mortgage Investments II Inc., the Master Servicer or the Trustee referred
to below or any of their affiliates or any other person. Neither this
Certificate nor the underlying Mortgage Loans are guaranteed or insured by any
governmental entity or by Structured Asset Mortgage Investments II Inc., the
Master Servicer or the Trustee or any of their affiliates or any other person.
None of Structured Asset Mortgage Investments II Inc., the Master Servicer or
any of their affiliates will have any obligation with respect to any certificate
or other obligation secured by or payable from payments on the Certificates.
This certifies that Cede & Co. is the registered owner of the
Fractional Undivided Interest evidenced hereby in the beneficial ownership
interest of Certificates of the same Class as this Certificate in a portion of a
trust (the "Trust Fund") primarily consisting of fixed rate mortgage loans
secured by first liens on one- to four- family residential properties
(collectively, the "Mortgage Loans") sold by Structured Asset Mortgage
Investments II Inc. ("XXXX XX"). The Mortgage Loans were sold by EMC Mortgage
Corporation ("EMC") to XXXX XX. Xxxxx Fargo Bank, National Association ("Xxxxx
Fargo") will act as master servicer of the Mortgage Loans (the "Master
Servicer", which term includes any successors thereto under the Agreement
referred to below). The Trust Fund was created pursuant to the Pooling and
Servicing Agreement dated as of the Cut-off Date specified above (the
"Agreement"), among EMC Mortgage Corporation, as seller and company (the
"Seller"), XXXX XX, as depositor (the "Depositor"), Xxxxx Fargo Bank, National
Association as master servicer and securities administrator (in such capacity,
the "Securities Administrator") and U.S. Bank National Association as trustee
(the "Trustee"), a summary of certain of the pertinent provisions of which is
set forth hereafter. To the extent not defined herein, capitalized terms used
herein shall have the meaning ascribed to them in the Agreement. This
Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of its acceptance hereof assents and by which such Holder is bound.
The Trustee will distribute on the 25th day of each month, or,
if such 25th day is not a Business Day, the immediately following Business Day
(each, a "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 calendar month preceding
the month of such Distribution Date, an amount equal to the product of the
Fractional Undivided Interest evidenced by this Certificate and the amount of
principal required to be distributed to the Holders of Certificates of the same
Class as this Certificate. The Assumed Final Distribution Date is the
Distribution Date in the month immediately following the month of the latest
scheduled maturity date of any Mortgage Loan and is not likely to be the date on
which the Current Principal Amount of this Class of Certificates will be reduced
to zero.
Distributions on this Certificate will be made by the Trustee
by check mailed to the address of the Person entitled thereto as such name and
address shall appear on the Certificate Register or, if such Person so requests
by notifying the Trustee in writing as specified in the Agreement by wire
transfer. Notwithstanding the above, the final distribution on this Certificate
will be made after due notice by the Trustee of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Trustee for that purpose and designated in
such notice. The Initial Current Principal Amount of this Certificate is set
forth above. The Current Principal Amount hereof will be reduced to the extent
of distributions allocable to principal hereon and any Realized Losses allocable
hereto.
This Certificate is one of a duly authorized issue of
Certificates designated as set forth on the face hereof (the "Certificates").
The Certificates, in the aggregate, evidence the entire beneficial ownership
interest in the Trust Fund formed pursuant to the Agreement.
The Certificateholder, by its acceptance of this Certificate,
agrees that it will look solely to the Trust Fund for payment hereunder and that
the Trustee is not liable to the Certificateholders for any amount payable under
this Certificate or the Agreement or, except as expressly provided in the
Agreement, subject to any liability under the Agreement.
This Certificate does not purport to summarize the Agreement
and reference is made to the Agreement for the interests, rights and limitations
of rights, benefits, obligations and duties evidenced hereby, and the rights,
duties and immunities of the Trustee.
The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Master Servicer and the Trustee and the rights
of the Certificateholders under the Agreement from time to time by the parties
thereto with the consent of the Holders of Certificates, and with the consent of
the Insurer with respect to amendments related to the Mortgage Pass-Through
Certificates, evidencing Fractional Undivided Interests aggregating not less
than 51% of the portion of the Trust Fund related to such Certificates (or in
certain cases, Holders of Certificates of affected Classes evidencing such
percentage of the Fractional Undivided Interests thereof). 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 lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates.
As provided in the Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is registrable
with the Trustee upon surrender of this Certificate for registration of transfer
at the offices or agencies maintained by the Trustee for such purposes, duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Trustee duly executed by the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
in authorized denominations representing a like aggregate Fractional Undivided
Interest will be issued to the designated transferee.
The Certificates are issuable only as registered Certificates
without coupons in the Classes and denominations specified in the Agreement. As
provided in the Agreement and subject to certain limitations therein set forth,
this Certificate is exchangeable for one or more new Certificates evidencing the
same Class and in the same aggregate Fractional Undivided Interest, as requested
by the Holder surrendering the same.
No service charge will be made to the Certificateholders for
any such registration of transfer, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Depositor, the Master Servicer, 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 none of the Depositor, the Master Servicer,
the Trustee or any such agent shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund
created thereby (other than the obligations to make payments to
Certificateholders with respect to the termination of the Agreement) shall
terminate upon the earlier of (i) the later of the (A) final payment or other
liquidation (or Advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund and (B) disposition of all property acquired upon
foreclosure or deed in lieu of foreclosure of any Mortgage Loan and the
remittance of all funds due under the Agreement, or (ii) the optional repurchase
by the party named in the Agreement of all the Mortgage Loans and other assets
of the Trust Fund in accordance with the terms of the Agreement. Such optional
repurchase may be made only on or after the Distribution Date on which the
aggregate unpaid principal balance of the Mortgage Loans is less than the
percentage of the aggregate Outstanding Principal Balance specified in the
Agreement of the Mortgage Loans at the Cut-off Date. The exercise of such right
will effect the early retirement of the Certificates. In no event, however, will
the Trust Fund created by the Agreement continue beyond the earlier of (i) the
"latest possible maturity date" specified in Section 5.01(d) of the Agreement or
(ii) the expiration of 21 years after the death of certain persons identified in
the Agreement.
Unless this Certificate has been countersigned by an
authorized signatory of the Trustee by manual signature, this Certificate shall
not be entitled to any benefit under the Agreement, or be valid for any purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused
this Certificate to be duly executed.
Dated: June 30, 2005 XXXXX FARGO BANK,
NATIONAL ASSOCIATION,
Not in its individual capacity but solely as
Securities Administrator
By:
----------------------------------------
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the
within-mentioned Agreement.
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
Authorized signatory of Xxxxx Fargo Bank,
National Association, not in its individual
capacity but solely as Securities
Administrator
By:
----------------------------------------
Authorized Signatory
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto __________________________________ (Please print or
typewrite name and address including postal zip code of assignee) a Fractional
Undivided Interest evidenced by the within Mortgage Pass-Through Certificate and
hereby authorizes the transfer of registration of such interest to assignee on
the Certificate Register of the Trust Fund.
I (We) further direct the Certificate Registrar to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:
Dated:
---------------------------------------------
Signature by or on behalf of assignor
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________ for the account
of _________________________ account number _____________, or, if mailed by
check, to ______________________________. Applicable statements should be mailed
to _____________________________________________ .
This information is provided by __________________, the
assignee named above, or ________________________, as its agent.
EXHIBIT A-4
FORM OF CLASS I-R CERTIFICATE
THIS CERTIFICATE MAY NOT BE HELD BY OR TRANSFERRED TO A
NON-UNITED STATES PERSON, A PUBLICLY TRADED PARTNERSHIP OR A DISQUALIFIED
ORGANIZATION (AS DEFINED BELOW).
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE
IS A "RESIDUAL INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
THIS CERTIFICATE MAY NOT BE ACQUIRED DIRECTLY OR INDIRECTLY
BY, OR ON BEHALF OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT
WHICH IS SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED, AND/OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED, UNLESS THE PROPOSED TRANSFEREE PROVIDES THE TRUSTEE WITH AN OPINION OF
COUNSEL ADDRESSED TO THE TRUSTEE, DEPOSITOR, MASTER SERVICER AND SECURITIES
ADMINISTRATOR AND ON WHICH THEY MAY RELY THAT IS SATISFACTORY TO THE TRUSTEE
THAT THE PURCHASE OF CERTIFICATES ON BEHALF OF SUCH PERSON WILL NOT RESULT IN OR
CONSTITUTE A NONEXEMPT PROHIBITED TRANSACTION, IS PERMISSIBLE UNDER APPLICABLE
LAW AND WILL NOT GIVE RISE TO ANY ADDITIONAL OBLIGATIONS ON THE PART OF THE
DEPOSITOR, THE MASTER SERVICER, THE SECURITIES ADMINISTRATOR OR THE TRUSTEE.
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE
MAY BE MADE ONLY IF THE PROPOSED TRANSFEREE PROVIDES A TRANSFER AFFIDAVIT TO THE
TRUSTEE THAT (1) SUCH TRANSFEREE IS NOT (A) THE UNITED STATES, ANY STATE OR
POLITICAL SUBDIVISION THEREOF, ANY POSSESSION OF THE UNITED STATES, OR ANY
AGENCY OR INSTRUMENTALITY OF ANY OF THE FOREGOING (OTHER THAN AN INSTRUMENTALITY
WHICH IS A CORPORATION IF ALL OF ITS ACTIVITIES ARE SUBJECT TO TAX AND EXCEPT
FOR THE XXXXXXX MAC, A MAJORITY OF ITS BOARD OF DIRECTORS IS NOT SELECTED BY
SUCH GOVERNMENTAL UNIT), (B) A FOREIGN GOVERNMENT, ANY INTERNATIONAL
ORGANIZATION, OR ANY AGENCY OR INSTRUMENTALITY OF EITHER OF THE FOREGOING, (C)
ANY ORGANIZATION (OTHER THAN CERTAIN FARMERS' COOPERATIVES DESCRIBED IN SECTION
521 OF THE CODE) WHICH IS EXEMPT FROM THE TAX IMPOSED BY CHAPTER 1 OF THE CODE
UNLESS SUCH ORGANIZATION IS SUBJECT TO THE TAX IMPOSED BY SECTION 511 OF THE
CODE (INCLUDING THE TAX IMPOSED BY SECTION 511 OF THE CODE ON UNRELATED BUSINESS
TAXABLE INCOME), (D) RURAL ELECTRIC AND TELEPHONE COOPERATIVES DESCRIBED IN
SECTION 1381(A)(2)(C) OF THE CODE, (E) AN ELECTING LARGE PARTNERSHIP UNDER
SECTION 775(A) OF THE CODE (ANY SUCH PERSON DESCRIBED IN THE FOREGOING CLAUSES
(A), (B), (C), (D) OR (E) BEING HEREIN REFERRED TO AS A "DISQUALIFIED
ORGANIZATION"), OR (F) AN AGENT OF A DISQUALIFIED ORGANIZATION, (2) NO PURPOSE
OF SUCH TRANSFER IS TO IMPEDE THE ASSESSMENT OR COLLECTION OF TAX AND (3) SUCH
TRANSFEREE SATISFIES CERTAIN ADDITIONAL CONDITIONS RELATING TO THE FINANCIAL
CONDITION OF THE PROPOSED TRANSFEREE. NOTWITHSTANDING THE REGISTRATION IN THE
CERTIFICATE REGISTER OR ANY TRANSFER, SALE OR OTHER DISPOSITION OF THIS
CERTIFICATE TO A DISQUALIFIED ORGANIZATION OR AN AGENT OF A DISQUALIFIED
ORGANIZATION, SUCH REGISTRATION SHALL BE DEEMED TO BE OF NO LEGAL FORCE OR
EFFECT WHATSOEVER AND SUCH PERSON SHALL NOT BE DEEMED TO BE A CERTIFICATEHOLDER
FOR ANY PURPOSE HEREUNDER, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF
DISTRIBUTIONS ON THIS CERTIFICATE. EACH HOLDER OF THIS CERTIFICATE BY ACCEPTANCE
OF THIS CERTIFICATE SHALL BE DEEMED TO HAVE CONSENTED TO THE PROVISIONS OF THIS
PARAGRAPH.
Certificate No.1 Pass-Through Rate: _____%
Class I-R
Date of Pooling and Servicing Agreement Aggregate Initial Current Principal Amount of this
and Cut-off Date: Certificate as of the Cut-off Date:
June 1, 2005 $_____________
First Distribution Date: Initial Current Principal Amount of this Certificate as
July 25, 2005 of the Cut-off Date: $_________
Master Servicer: CUSIP: [_____________]
Xxxxx Fargo Bank, National Association
Assumed Final Distribution Date:
[______________]
PRIME MORTGAGE TRUST 2005-2
MORTGAGE PASS-THROUGH CERTIFICATE
SERIES 2005-2
evidencing a fractional undivided interest in the distributions
allocable to the Class I-R Certificates with respect to a portion of a
Trust Fund (as defined below) consisting primarily of a pool of fixed
rate mortgage loans secured by first liens on one-to-four family
residential properties sold by STRUCTURED ASSET MORTGAGE INVESTMENTS II
INC.
This Certificate is payable solely from the assets of the
Trust Fund, and does not represent an obligation of or interest in Structured
Asset Mortgage Investments II Inc., the Master Servicer or the Trustee referred
to below or any of their affiliates or any other person. Neither this
Certificate nor the underlying Mortgage Loans are guaranteed or insured by any
governmental entity or by Structured Asset Mortgage Investments II Inc., the
Master Servicer or the Trustee or any of their affiliates or any other person.
None of Structured Asset Mortgage Investments II Inc., the Master Servicer or
any of their affiliates will have any obligation with respect to any certificate
or other obligation secured by or payable from payments on the Certificates.
This certifies that Bear, Xxxxxxx Securities Corp. is the
registered owner of the Fractional Undivided Interest evidenced hereby in the
beneficial ownership interest of Certificates of the same Class as this
Certificate in a portion of a trust (the "Trust Fund") primarily consisting of
fixed rate mortgage loans secured by first liens on one- to four- family
residential properties (collectively, the "Mortgage Loans") sold by Structured
Asset Mortgage Investments II Inc. ("XXXX XX"). The Mortgage Loans were sold by
EMC Mortgage Corporation ("EMC") to XXXX XX. Xxxxx Fargo Bank, National
Association ("Xxxxx Fargo") will act as master servicer of the Mortgage Loans
(the "Master Servicer", which term includes any successors thereto under the
Agreement referred to below). The Trust Fund was created pursuant to the Pooling
and Servicing Agreement dated as of the Cut-off Date specified above (the
"Agreement'), among XXXX XX, as depositor (the "Depositor"), Xxxxx Fargo Bank,
National Association as Master Servicer and securities administrator (in such
capacity, the "Securities Administrator"), EMC Mortgage Corporation, as seller
and company, and U.S. Bank National Association, as trustee (the "Trustee"), a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, capitalized terms used herein shall have the
meaning ascribed to them in the Agreement. This Certificate is issued under and
is subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of its acceptance hereof
assents and by which such Holder is bound.
Interest on this Certificate will accrue during the month
prior to the month in which a Distribution Date (as hereinafter defined) occurs
on the Current Principal Amount hereof at a per annum rate equal to the
Pass-Through Rate set forth above and as further described in the Agreement. The
Trustee will distribute on the 25th day of each month, or, if such 25th day is
not a Business Day, the immediately following Business Day (each, a
"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 calendar month preceding the month of
such Distribution Date, an amount equal to the product of the Fractional
Undivided Interest evidenced by this Certificate and the amount (of interest and
principal, if any) required to be distributed to the Holders of Certificates of
the same Class as this Certificate. The Assumed Final Distribution Date is the
Distribution Date in the month immediately following the month of the latest
scheduled maturity date of any Mortgage Loan and is not likely to be the date on
which the Current Principal Amount of this Class of Certificates will be reduced
to zero.
Distributions on this Certificate will be made by the Trustee
by check mailed to the address of the Person entitled thereto as such name and
address shall appear on the Certificate Register or, if such Person so requests
by notifying the Trustee in writing as specified in the Agreement by wire
transfer. Notwithstanding the above, the final distribution on this Certificate
will be made after due notice by the Trustee of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office or agency appointed by the Trustee for that purpose and designated in
such notice. The Initial Current Principal Amount of this Certificate is set
forth above. The Current Principal Amount hereof will be reduced to the extent
of distributions allocable to principal hereon and any Realized Losses allocable
hereto.
Each Holder of this Certificate will be deemed to have agreed
to be bound by the restrictions set forth in the Agreement to the effect that
(i) each person holding or acquiring any Ownership Interest in this Certificate
must be a United States Person and a Permitted Transferee, (ii) the transfer of
any Ownership Interest in this Certificate will be conditioned upon the delivery
to XXXX XX, the Trustee and the Securities Administrator of, among other things,
an affidavit to the effect that it is a United States Person and Permitted
Transferee, (iii) any attempted or purported transfer of any Ownership Interest
in this Certificate in violation of such restrictions will be absolutely null
and void and will vest no rights in the purported transferee, and (iv) if any
person other than a United States Person and a Permitted Transferee acquires any
Ownership Interest in this Certificate in violation of such restrictions, then
the Depositor will have the right, in its sole discretion and without notice to
the Holder of this Certificate, to sell this Certificate to a purchaser selected
by the Depositor, which purchaser may be the Depositor, or any affiliate of the
Depositor, on such terms and conditions as the Depositor may choose.
This certificate may not be acquired directly or indirectly
by, or on behalf of, an employee benefit plan or other retirement arrangement
which is subject to title I of the Employee Retirement Income Security Act of
1974, as amended, and/or section 4975 of the Internal Revenue Code of 1986, as
amended, unless the proposed transferee provides the Trustee with an opinion of
counsel addressed to the Trustee, Master Servicer and the Securities
Administrator and on which they may rely (which shall not be at the expense of
the Trustee, Master Servicer or the Securities Administrator) which is
acceptable to the Trustee, that the purchase of this Certificate will not result
in or constitute a nonexempt prohibited transaction, is permissible under
applicable law and will not give rise to any additional fiduciary obligations on
the part of the Depositor, the Master Servicer or the Trustee.
This Certificate is one of a duly authorized issue of
Certificates designated as set forth on the face hereof (the "Certificates")..
The Certificates, in the aggregate, evidence the entire beneficial ownership
interest in the Trust Fund formed pursuant to the Agreement.
The Certificateholder, by its acceptance of this Certificate,
agrees that it will look solely to the Trust Fund for payment hereunder and that
the Trustee is not liable to the Certificateholders for any amount payable under
this Certificate or the Agreement or, except as expressly provided in the
Agreement, subject to any liability under the Agreement.
This Certificate does not purport to summarize the Agreement
and reference is made to the Agreement for the interests, rights and limitations
of rights, benefits, obligations and duties evidenced hereby, and the rights,
duties and immunities of the Trustee.
The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Master Servicer and the Trustee and the rights
of the Certificateholders under the Agreement from time to time by the parties
thereto with the consent of the Holders of Certificates, and with the consent of
the Insurer with respect to amendments related to the Mortgage Pass-Through
Certificates, evidencing Fractional Undivided Interests aggregating not less
than 51% of the portion of the Trust Fund related to such Certificates (or in
certain cases, Holders of Certificates of affected Classes evidencing such
percentage of the Fractional Undivided Interests thereof). 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 lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates.
As provided in the Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is registrable
with the Trustee upon surrender of this Certificate for registration of transfer
at the offices or agencies maintained by the Trustee for such purposes, duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Trustee duly executed by the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
in authorized denominations representing a like aggregate Fractional Undivided
Interest will be issued to the designated transferee.
The Certificates are issuable only as registered Certificates
without coupons in the Classes and denominations specified in the Agreement. As
provided in the Agreement and subject to certain limitations therein set forth,
this Certificate is exchangeable for one or more new Certificates evidencing the
same Class and in the same aggregate Fractional Undivided Interest, as requested
by the Holder surrendering the same.
No service charge will be made to the Certificateholders for
any such registration of transfer, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. The Depositor, the Master Servicer, 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 none of the Depositor, the Master Servicer,
the Trustee or any such agent shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund
created thereby (other than the obligations to make payments to
Certificateholders with respect to the termination of the Agreement) shall
terminate upon the earlier of (i) the later of the (A) final payment or other
liquidation (or Advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund and (B) disposition of all property acquired upon
foreclosure or deed in lieu of foreclosure of any Mortgage Loan and the
remittance of all funds due under the Agreement, or (ii) the optional repurchase
by the party named in the Agreement of all the Mortgage Loans and other assets
of the Trust Fund in accordance with the terms of the Agreement. Such optional
repurchase may be made only on or after the Distribution Date on which the
aggregate unpaid principal balance of the Mortgage Loans is less than the
percentage of the aggregate Outstanding Principal Balance specified in the
Agreement of the Mortgage Loans at the Cut-off Date. The exercise of such right
will effect the early retirement of the Certificates. In no event, however, will
the Trust Fund created by the Agreement continue beyond the earlier of (i) the
"latest possible maturity date" specified in Section 5.01(d) of the Agreement or
(ii) the expiration of 21 years after the death of certain persons identified in
the Agreement.
Unless this Certificate has been countersigned by an
authorized signatory of the Trustee by manual signature, this Certificate shall
not be entitled to any benefit under the Agreement, or be valid for any purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused
this Certificate to be duly executed.
Dated: June 30, 2005 XXXXX FARGO BANK,
NATIONAL ASSOCIATION,
Not in its individual capacity but solely as
Securities Administrator
By:
----------------------------------------
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the
within-mentioned Agreement.
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
Authorized signatory of Xxxxx Fargo Bank,
National Association, not in its individual
capacity but solely as Securities
Administrator
By:
----------------------------------------
Authorized Signatory
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto __________________________________ (Please print or
typewrite name and address including postal zip code of assignee) a Fractional
Undivided Interest evidenced by the within Mortgage Pass-Through Certificate and
hereby authorizes the transfer of registration of such interest to assignee on
the Certificate Register of the Trust Fund.
I (We) further direct the Certificate Registrar to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:
Dated:
---------------------------------------------
Signature by or on behalf of assignor
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________ for the account
of _________________________ account number _____________, or, if mailed by
check, to ______________________________. Applicable statements should be mailed
to ______________________________________________ .
This information is provided by __________________, the
assignee named above, or ________________________, as its agent.
EXHIBIT A-5
FORM OF CLASS II-R CERTIFICATE
THIS CERTIFICATE MAY NOT BE HELD BY OR TRANSFERRED TO A
NON-UNITED STATES PERSON, A PUBLICLY TRADED PARTNERSHIP OR A DISQUALIFIED
ORGANIZATION (AS DEFINED BELOW).
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE
IS A "RESIDUAL INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT" AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
THIS CERTIFICATE MAY NOT BE ACQUIRED DIRECTLY OR INDIRECTLY
BY, OR ON BEHALF OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT
WHICH IS SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED, OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED, UNLESS THE PROPOSED TRANSFEREE PROVIDES THE TRUSTEE WITH AN OPINION OF
COUNSEL FOR THE BENEFIT OF THE DEPOSITOR, MASTER SERVICER, THE CERTIFICATE
REGISTRAR AND THE SECURITIES ADMINISTRATOR AND ON WHICH THEY MAY RELY (WHICH
SHALL NOT BE AT THE EXPENSE OF THE TRUSTEE) WHICH IS ACCEPTABLE TO THE TRUSTEE,
THAT THE PURCHASE OF THIS CERTIFICATE WILL NOT RESULT IN OR CONSTITUTE A
NONEXEMPT PROHIBITED TRANSACTION, IS PERMISSIBLE UNDER APPLICABLE LAW AND WILL
NOT GIVE RISE TO ANY ADDITIONAL OBLIGATIONS ON THE PART OF THE SELLER, THE
MASTER SERVICER, ANY SERVICER, THE SECURITIES ADMINISTRATOR, THE CERTIFICATE
REGISTRAR OR THE TRUSTEE.
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE
MAY BE MADE ONLY IF THE PROPOSED TRANSFEREE OBTAINS THE PRIOR WRITTEN CONSENT OF
STRUCTURED ASSET MORTGAGE INVESTMENTS II INC. AND THE SECURITIES ADMINISTRATOR
AND PROVIDES A TRANSFER AFFIDAVIT TO STRUCTURED ASSET MORTGAGE INVESTMENTS II
INC., THE SECURITIES ADMINISTRATOR AND THE TRUSTEE THAT (1) SUCH TRANSFEREE IS
NOT (A) THE UNITED STATES, ANY STATE OR POLITICAL SUBDIVISION THEREOF, ANY
FOREIGN GOVERNMENT, ANY INTERNATIONAL ORGANIZATION, OR ANY AGENCY OR
INSTRUMENTALITY OF ANY OF THE FOREGOING, (B) ANY ORGANIZATION (OTHER THAN A
COOPERATIVE DESCRIBED IN SECTION 521 OF THE CODE) WHICH IS EXEMPT FROM THE TAX
IMPOSED BY CHAPTER 1 OF THE CODE UNLESS SUCH ORGANIZATION IS SUBJECT TO THE TAX
IMPOSED BY SECTION 511 OF THE CODE, (C) ANY ORGANIZATION DESCRIBED IN SECTION
1381(A)(2)(C) OF THE CODE, (ANY SUCH PERSON DESCRIBED IN THE FOREGOING CLAUSES
(A), (B) OR (C) BEING HEREIN REFERRED TO AS A "DISQUALIFIED ORGANIZATION") OR
(D) AN AGENT OF A DISQUALIFIED ORGANIZATION, (2) NO PURPOSE OF SUCH TRANSFER IS
TO IMPEDE THE ASSESSMENT OR COLLECTION OF TAX AND (3) SUCH TRANSFEREE SATISFIES
CERTAIN ADDITIONAL CONDITIONS RELATING TO THE FINANCIAL CONDITION OF THE
PROPOSED TRANSFEREE. NOTWITHSTANDING THE REGISTRATION IN THE CERTIFICATE
REGISTER OR ANY TRANSFER, SALE OR OTHER DISPOSITION OF THIS CERTIFICATE TO A
DISQUALIFIED ORGANIZATION OR AN AGENT OF A DISQUALIFIED ORGANIZATION, SUCH
REGISTRATION SHALL BE DEEMED TO BE OF NO LEGAL FORCE OR EFFECT WHATSOEVER AND
SUCH PERSON SHALL NOT BE DEEMED TO BE A CERTIFICATEHOLDER FOR ANY PURPOSE
HEREUNDER, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS
CERTIFICATE. EACH HOLDER OF THIS CERTIFICATE BY ACCEPTANCE OF THIS CERTIFICATE
SHALL BE DEEMED TO HAVE CONSENTED TO THE PROVISIONS OF THIS PARAGRAPH.
Certificate No.1 Variable Pass-Through Rate
Class II-R-1
Date of Pooling and Servicing Agreement Aggregate Initial Current Principal Amount of this
and Cut-off Date: Certificate as of the Cut-off Date: $100
June 1, 2005
First Distribution Date: Initial Current Principal Amount of this Certificate as
July 25, 2005 of the Cut-off Date: $100
Master Servicer: CUSIP: [_______]
Xxxxx Fargo Bank, National Association
Assumed Final Distribution Date:
[______________]
PRIME MORTGAGE TRUST 2005-2
MORTGAGE PASS-THROUGH CERTIFICATE
SERIES 2005-2
evidencing a fractional undivided interest in the
distributions allocable to the Class II-R-1
Certificates with respect to a portion of a Trust
Fund (as defined below) consisting primarily of a
pool of fixed rate mortgage loans secured by first
liens on one-to-four family residential properties
sold by STRUCTURED ASSET MORTGAGE INVESTMENTS II INC.
This Certificate is payable solely from the assets of the
Trust Fund, and does not represent an obligation of or interest in Structured
Asset Mortgage Investments II Inc., the Master Servicer, the Securities
Administrator or the Trustee referred to below or any of their affiliates or any
other person. Neither this Certificate nor the underlying Mortgage Loans are
guaranteed or insured by any governmental entity or by Structured Asset Mortgage
Investments II Inc., the Master Servicer, the Securities Administrator or the
Trustee or any of their affiliates or any other person. None of the Structured
Asset Mortgage Investments II Inc., the Master Servicer or any of their
affiliates will have any obligation with respect to any certificate or other
obligation secured by or payable from payments on the Certificates.
This certifies that Bear, Xxxxxxx Securities Corp. is the
registered owner of the Fractional Undivided Interest evidenced hereby in the
beneficial ownership interest of Certificates of the same Class as this
Certificate in a portion of a trust (the "Trust Fund") primarily consisting of
fixed rate mortgage loans secured by first liens on one- to four- family
residential properties (collectively, the "Mortgage Loans") sold by Structured
Asset Mortgage Investments II Inc. ("XXXX XX"). The Mortgage Loans were sold by
EMC Mortgage Corporation ("EMC") to XXXX XX. Xxxxx Fargo Bank, National
Association ("Xxxxx Fargo") will act as master servicer of the Mortgage Loans
and as securities administrator (the "Master Servicer" and the "Securities
Administrator, which terms includes any successors thereto under the Agreement
referred to below). The Trust Fund was created pursuant to the Pooling and
Servicing Agreement dated as of the Cut-off Date specified above (the
"Agreement"), among XXXX XX, as depositor (the "Depositor"), Xxxxx Fargo Bank,
National Association as Master Servicer and securities administrator (in such
capacity, the "Securities Administrator"), EMC Mortgage Corporation, as seller
and company, and U.S. Bank National Association, as trustee (the "Trustee"), a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, capitalized terms used herein shall have the
meaning ascribed to them in the Agreement. This Certificate is issued under and
is subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of its acceptance hereof
assents and by which such Holder is bound.
Interest on this Certificate will accrue during the month
prior to the month in which a Distribution Date (as hereinafter defined) occurs
on the Current Principal Amount hereof at a per annum rate equal to the
Pass-Through Rate set forth above and as further described in the Agreement. The
Trustee will distribute on the 25th day of each month, or, if such 25th day is
not a Business Day, the immediately following Business Day (each, a
"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 calendar month preceding the month of
such Distribution Date, an amount equal to the product of the Fractional
Undivided Interest evidenced by this Certificate and the amount (of interest and
principal, if any) required to be distributed to the Holders of Certificates of
the same Class as this Certificate. The Assumed Final Distribution Date is the
Distribution Date in the month immediately following the month of the latest
scheduled maturity date of any Mortgage Loan and is not likely to be the date on
which the Current Principal Amount of this Class of Certificates will be reduced
to zero.
Distributions on this Certificate will be made by the paying
Agent by check mailed to the address of the Person entitled thereto as such name
and address shall appear on the Certificate Register or, if such Person so
requests by notifying the Securities Administrator in writing as specified in
the Agreement by wire transfer. Notwithstanding the above, the final
distribution on this Certificate will be made after due notice by the paying
Agent of the pendency of such distribution and only upon presentation and
surrender of this Certificate at the office or agency appointed by the
Securities Administrator for that purpose and designated in such notice. The
Initial Current Principal Amount of this Certificate is set forth above. The
Current Principal Amount hereof will be reduced to the extent of distributions
allocable to principal hereon and any Realized Losses allocable hereto.
Each Holder of this Certificate will be deemed to have agreed
to be bound by the restrictions set forth in the Agreement to the effect that
(i) each person holding or acquiring any Ownership Interest in this Certificate
must be a United States Person and a Permitted Transferee, (ii) the transfer of
any Ownership Interest in this Certificate will be conditioned upon the delivery
to XXXX XX, the Trustee and the Securities Administrator of, among other things,
an affidavit to the effect that it is a United States Person and Permitted
Transferee, (iii) any attempted or purported transfer of any Ownership Interest
in this Certificate in violation of such restrictions will be absolutely null
and void and will vest no rights in the purported transferee, and (iv) if any
person other than a United States Person and a Permitted Transferee acquires any
Ownership Interest in this Certificate in violation of such restrictions, then
the Depositor will have the right, in its sole discretion and without notice to
the Holder of this Certificate, to sell this Certificate to a purchaser selected
by the Depositor, which purchaser may be the Depositor, or any affiliate of the
Depositor, on such terms and conditions as the Depositor may choose.
This certificate may not be acquired directly or indirectly
by, or on behalf of, an employee benefit plan or other retirement arrangement
which is subject to title I of the Employee Retirement Income Security Act of
1974, as amended, and/or section 4975 of the Internal Revenue Code of 1986, as
amended, unless the proposed transferee provides the Trustee with an opinion of
counsel addressed to the Trustee, Master Servicer and the Securities
Administrator and on which they may rely (which shall not be at the expense of
the Trustee, Master Servicer or the Securities Administrator) which is
acceptable to the Trustee, that the purchase of this Certificate will not result
in or constitute a nonexempt prohibited transaction, is permissible under
applicable law and will not give rise to any additional fiduciary obligations on
the part of the Depositor, the Master Servicer or the Trustee.
This Certificate is one of a duly authorized issue of
Certificates designated as set forth on the face hereof (the "Certificates").
The Certificates, in the aggregate, evidence the entire beneficial ownership
interest in the Trust Fund formed pursuant to the Agreement.
The Certificateholder, by its acceptance of this Certificate,
agrees that it will look solely to the Trust Fund for payment hereunder and that
the Trustee is not liable to the Certificateholders for any amount payable under
this Certificate or the Agreement or, except as expressly provided in the
Agreement, subject to any liability under the Agreement.
This Certificate does not purport to summarize the Agreement
and reference is made to the Agreement for the interests, rights and limitations
of rights, benefits, obligations and duties evidenced hereby, and the rights,
duties and immunities of the Trustee.
The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Master Servicer, the Securities Administrator
and the Trustee and the rights of the Certificateholders under the Agreement
from time to time by the parties thereto with the consent of the Holders of
Certificates, evidencing Fractional Undivided Interests aggregating not less
than 51% of the portion of the Trust Fund related to such Certificates (or in
certain cases, Holders of Certificates of affected Classes evidencing such
percentage of the Fractional Undivided Interests thereof). 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 lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates.
As provided in the Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is registrable
with the certificate registrar upon surrender of this Certificate for
registration of transfer at the offices or agencies maintained by the Securities
Administrator for such purposes, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Securities Administrator duly
executed by the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Certificates in authorized denominations
representing a like aggregate Fractional Undivided Interest will be issued to
the designated transferee.
The Certificates are issuable only as registered Certificates
without coupons in the Classes and denominations specified in the Agreement. As
provided in the Agreement and subject to certain limitations therein set forth,
this Certificate is exchangeable for one or more new Certificates evidencing the
same Class and in the same aggregate Fractional Undivided Interest, as requested
by the Holder surrendering the same.
No service charge will be made to the Certificateholders for
any such registration of transfer, but the Securities Administrator may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith. The Depositor, the Master Servicer, the
Securities Administrator, 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 none of the Depositor, the Master Servicer, the Securities
Administrator, the Trustee or any such agent shall be affected by notice to the
contrary.
The obligations created by the Agreement and the Trust Fund
created thereby (other than the obligations to make payments to
Certificateholders with respect to the termination of the Agreement) shall
terminate upon the earlier of (i) the later of the (A) final payment or other
liquidation (or Advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund and (B) disposition of all property acquired upon
foreclosure or deed in lieu of foreclosure of any Mortgage Loan and the
remittance of all funds due under the Agreement, or (ii) the optional repurchase
by the party named in the Agreement of all the Mortgage Loans and other assets
of the Trust Fund in accordance with the terms of the Agreement. Such optional
repurchase may be made only on or after the Distribution Date on which the
aggregate unpaid principal balance of the Mortgage Loans is less than the
percentage of the aggregate Outstanding Principal Balance specified in the
Agreement of the Mortgage Loans at the Cut-off Date. The exercise of such right
will effect the early retirement of the Certificates. In no event, however, will
the Trust Fund created by the Agreement continue beyond the earlier of (i) the
"latest possible maturity date" specified in Section 5.01(d) of the Agreement or
(ii) the expiration of 21 years after the death of certain persons identified in
the Agreement.
Unless this Certificate has been countersigned by an
authorized signatory of the Securities Administrator by manual signature, this
Certificate shall not be entitled to any benefit under the Agreement, or be
valid for any purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused
this Certificate to be duly executed.
Dated: June 30, 2005 XXXXX FARGO BANK,
NATIONAL ASSOCIATION,
Not in its individual capacity but solely as
Securities Administrator
By:
----------------------------------------
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the
within-mentioned Agreement.
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
Authorized signatory of Xxxxx Fargo Bank,
National Association, not in its individual
capacity but solely as Securities
Administrator
By:
----------------------------------------
Authorized Signatory
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assigns(s)
and transfers unto _____________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(please print or typewrite name and address including postal zip code of
assignee)
a Percentage Interest equal to ___% evidenced by the within Re-REMIC Certificate
and hereby authorizes the transfer of registration of such interest to assignee
on the Certificate Register of the Trust Fund.
I (we) further direct the Trustee to issue a new Re-REMIC
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Re-REMIC Certificate to the following address:
Dated:
DISTRIBUTION INSTRUCTIONS
The Assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to _____________________________________________________________
________________________________________________________________________________
for the account of _____________________________________________________________
to _____________________________________________________________________________
Applicable statements should be mailed to ____________________
________________________________________________________________________________
________________________________________________________________________________
This information is provided by _____________________________,
the Assignee named above, or __________________________________________________,
as its agent. The Assignee's taxpayer identification number is ________________.
EXHIBIT A-6
FORM OF CLASS I-X CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE
IS A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
THE CURRENT PRINCIPAL AMOUNT OF THIS CERTIFICATE WILL BE
DECREASED BY THE PRINCIPAL PAYMENTS HEREON AND REALIZED LOSSES ALLOCABLE HERETO.
ACCORDINGLY, FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE CURRENT
PRINCIPAL AMOUNT OF THIS CERTIFICATE WILL BE DIFFERENT FROM THE DENOMINATION
SHOWN BELOW. ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT
PRINCIPAL AMOUNT BY INQUIRY OF THE SECURITIES ADMINISTRATOR NAMED HEREIN.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY TO THE SECURITIES ADMINISTRATOR
OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED WILL BE REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER
NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY AND ANY PAYMENT WILL BE MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE
THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
Certificate No.1 Variable Pass-Through Rate
Class I-X Senior
Date of Pooling and Servicing Agreement Aggregate Initial Notional Amount of this Senior
and Cut-off Date: Certificate as of the Cut-off Date:
June 1, 2005 $[______________]
First Distribution Date: Initial Current Amount of this Senior Certificate as of
July 25, 2005 the Cut-off Date:
$[______________]
Master Servicer: CUSIP: [________]
Xxxxx Fargo Bank, National Association
Assumed Final Distribution Date:
[_____________]
PRIME MORTGAGE TRUST 2005-2
MORTGAGE PASS-THROUGH CERTIFICATE
SERIES 2005-2
evidencing a fractional undivided interest in the
distributions allocable to the Class I-X Certificates
with respect to a portion of a Trust Fund consisting
primarily of a pool of fixed rate mortgage loans
secured by first liens on one-to-four family
residential properties sold by STRUCTURED ASSET
MORTGAGE INVESTMENTS II INC.
This Certificate is payable solely from the assets of the
Trust Fund, and does not represent an obligation of or interest in Structured
Asset Mortgage Investments II Inc., the Master Servicer, the Securities
Administrator or the Trustee referred to below or any of their affiliates or any
other person. Neither this Certificate nor the underlying Mortgage Loans are
guaranteed or insured by any governmental entity or by Structured Asset Mortgage
Investments II Inc., the Master Servicer, the Securities Administrator or the
Trustee or any of their affiliates or any other person. None of the Structured
Asset Mortgage Investments II Inc., the Master Servicer or any of their
affiliates will have any obligation with respect to any certificate or other
obligation secured by or payable from payments on the Certificates.
This certifies that Cede & Co. is the registered owner of the
Fractional Undivided Interest evidenced hereby in the beneficial ownership
interest of Certificates of the same Class as this Certificate in a portion of a
trust (the "Trust Fund") primarily consisting of fixed rate mortgage loans
secured by first liens on one- to four- family residential properties
(collectively, the "Mortgage Loans") sold by Structured Asset Mortgage
Investments II Inc. ("XXXX XX"). The Mortgage Loans were sold by EMC Mortgage
Corporation ("EMC") to XXXX XX. Xxxxx Fargo Bank, National Association ("Xxxxx
Fargo") will act as master servicer of the Mortgage Loans and as securities
administrator (the "Master Servicer" and the "Securities Administrator, which
terms includes any successors thereto under the Agreement referred to below).
The Trust Fund was created pursuant to the Pooling and Servicing Agreement dated
as of the Cut-off Date specified above (the "Agreement"), among XXXX XX, as
depositor (the "Depositor"), Xxxxx Fargo Bank, National Association as Master
Servicer and securities administrator (in such capacity, the "Securities
Administrator"), EMC Mortgage Corporation, as seller and company, and U.S. Bank
National Association, as trustee (the "Trustee"), a summary of certain of the
pertinent provisions of which is set forth hereafter. To the extent not defined
herein, capitalized terms used herein shall have the meaning ascribed to them in
the Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of its acceptance hereof assents and by which such
Holder is bound.
Interest on this Certificate will accrue during the month
prior to the month in which a Distribution Date (as hereinafter defined) occurs
on the Notional Amount hereof at a per annum rate equal to the Pass-Through Rate
set forth above and as further described in the Agreement. The Trustee will
distribute on the 25th day of each month, or, if such 25th day is not a Business
Day, the immediately following Business Day (each, a "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 calendar month preceding the month of such Distribution
Date, an amount equal to the product of the Fractional Undivided Interest
evidenced by this Certificate and the amount (of interest and principal, if any)
required to be distributed to the Holders of Certificates of the same Class as
this Certificate. The Assumed Final Distribution Date is the Distribution Date
in the month immediately following the month of the latest scheduled maturity
date of any Mortgage Loan and is not likely to be the date on which the Notional
Amount of this Class of Certificates will be reduced to zero.
Distributions on this Certificate will be made by the paying
Agent by check mailed to the address of the Person entitled thereto as such name
and address shall appear on the Certificate Register or, if such Person so
requests by notifying the Securities Administrator in writing as specified in
the Agreement by wire transfer. Notwithstanding the above, the final
distribution on this Certificate will be made after due notice by the paying
Agent of the pendency of such distribution and only upon presentation and
surrender of this Certificate at the office or agency appointed by the
Securities Administrator for that purpose and designated in such notice. The
Initial Notional Amount of this Certificate is set forth above. The Notional
Amount hereof will be reduced to the extent of distributions allocable to
principal hereon and any Realized Losses allocable hereto.
This Certificate is one of a duly authorized issue of
Certificates designated as set forth on the face hereof (the "Certificates").
The Certificates, in the aggregate, evidence the entire beneficial ownership
interest in the Trust Fund formed pursuant to the Agreement.
The Certificateholder, by its acceptance of this Certificate,
agrees that it will look solely to the Trust Fund for payment hereunder and that
the Trustee is not liable to the Certificateholders for any amount payable under
this Certificate or the Agreement or, except as expressly provided in the
Agreement, subject to any liability under the Agreement.
This Certificate does not purport to summarize the Agreement
and reference is made to the Agreement for the interests, rights and limitations
of rights, benefits, obligations and duties evidenced hereby, and the rights,
duties and immunities of the Trustee.
The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Master Servicer, the Securities Administrator
and the Trustee and the rights of the Certificateholders under the Agreement
from time to time by the parties thereto with the consent of the Holders of
Certificates, evidencing Fractional Undivided Interests aggregating not less
than 51% of the portion of the Trust Fund related to such Certificates (or in
certain cases, Holders of Certificates of affected Classes evidencing such
percentage of the Fractional Undivided Interests thereof). 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 lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates.
As provided in the Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is registrable
with the certificate registrar upon surrender of this Certificate for
registration of transfer at the offices or agencies maintained by the Securities
Administrator for such purposes, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Securities Administrator duly
executed by the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Certificates in authorized denominations
representing a like aggregate Fractional Undivided Interest will be issued to
the designated transferee.
The Certificates are issuable only as registered Certificates
without coupons in the Classes and denominations specified in the Agreement. As
provided in the Agreement and subject to certain limitations therein set forth,
this Certificate is exchangeable for one or more new Certificates evidencing the
same Class and in the same aggregate Fractional Undivided Interest, as requested
by the Holder surrendering the same.
No service charge will be made to the Certificateholders for
any such registration of transfer, but the Securities Administrator may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith. The Depositor, the Master Servicer, the
Securities Administrator, 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 none of the Depositor, the Master Servicer, the Securities
Administrator, the Trustee or any such agent shall be affected by notice to the
contrary.
The obligations created by the Agreement and the Trust Fund
created thereby (other than the obligations to make payments to
Certificateholders with respect to the termination of the Agreement) shall
terminate upon the earlier of (i) the later of the (A) final payment or other
liquidation (or Advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund and (B) disposition of all property acquired upon
foreclosure or deed in lieu of foreclosure of any Mortgage Loan and the
remittance of all funds due under the Agreement, or (ii) the optional repurchase
by the party named in the Agreement of all the Mortgage Loans and other assets
of the Trust Fund in accordance with the terms of the Agreement. Such optional
repurchase may be made only on or after the Distribution Date on which the
aggregate unpaid principal balance of the Mortgage Loans is less than the
percentage of the aggregate Outstanding Principal Balance specified in the
Agreement of the Mortgage Loans at the Cut-off Date. The exercise of such right
will effect the early retirement of the Certificates. In no event, however, will
the Trust Fund created by the Agreement continue beyond the earlier of (i) the
"latest possible maturity date" specified in Section 5.01(d) of the Agreement or
(ii) the expiration of 21 years after the death of certain persons identified in
the Agreement.
Unless this Certificate has been countersigned by an
authorized signatory of the Securities Administrator by manual signature, this
Certificate shall not be entitled to any benefit under the Agreement, or be
valid for any purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused
this Certificate to be duly executed.
Dated: June 30, 2005 XXXXX FARGO BANK,
NATIONAL ASSOCIATION,
Not in its individual capacity but solely as
Securities Administrator
By:
----------------------------------------
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the
within-mentioned Agreement.
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
Authorized signatory of Xxxxx Fargo Bank,
National Association, not in its individual
capacity but solely as Securities
Administrator
By:
----------------------------------------
Authorized Signatory
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto __________________________________ (Please print or
typewrite name and address including postal zip code of assignee) a Fractional
Undivided Interest evidenced by the within Mortgage Pass-Through Certificate and
hereby authorizes the transfer of registration of such interest to assignee on
the Certificate Register of the Trust Fund.
I (We) further direct the Certificate Registrar to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
Dated:
---------------------------------------------
Signature by or on behalf of assignor
---------------------------------------------
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________ for the account
of _________________________ account number _____________, or, if mailed by
check, to ______________________________. Applicable statements should be mailed
to ___________________________________________________ .
This information is provided by __________________, the
assignee named above, or ________________________, as its agent.
EXHIBIT A-7
FORM OF CLASS II-X[B] CERTIFICATE
[FOR CLASS II-XB ONLY:] [THIS CERTIFICATE IS SUBORDINATED IN
RIGHT OF PAYMENT TO THE SENIOR CERTIFICATES AS DESCRIBED IN THE AGREEMENT (AS
DEFINED BELOW).]
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE
IS A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE
TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL
REVENUE CODE OF 1986 (THE "CODE").
THE CURRENT PRINCIPAL AMOUNT OF THIS CERTIFICATE WILL BE
DECREASED BY THE PRINCIPAL PAYMENTS HEREON AND ANY REALIZED LOSSES ALLOCABLE
HERETO. ACCORDINGLY, FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE
CURRENT PRINCIPAL AMOUNT OF THIS CERTIFICATE WILL BE DIFFERENT FROM THE
DENOMINATION SHOWN BELOW. ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS
CURRENT PRINCIPAL AMOUNT BY INQUIRY OF THE SECURITIES ADMINISTRATOR NAMED
HEREIN.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY TO THE SECURITIES ADMINISTRATOR
OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED WILL BE REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER
NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY AND ANY PAYMENT WILL BE MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE
THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
[FOR CLASS II-XB ONLY:] [EACH BENEFICIAL OWNER OF THIS
CERTIFICATE OR ANY INTEREST HEREIN SHALL BE DEEMED TO HAVE REPRESENTED, BY
VIRTUE OF ITS ACQUISITION OR HOLDING OF THIS CERTIFICATE OR INTEREST HEREIN,
THAT EITHER (I) IT IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED OR SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED ("PLAN"), OR INVESTING WITH ASSETS OF
A PLAN OR (II) IT HAS ACQUIRED AND IS HOLDING SUCH CERTIFICATE IN RELIANCE ON
PROHIBITED TRANSACTION EXEMPTION 90-30, AS AMENDED FROM TIME TO TIME
("EXEMPTION"), AND THAT IT UNDERSTANDS THAT THERE ARE CERTAIN CONDITIONS TO THE
AVAILABILITY OF THE EXEMPTION, INCLUDING THAT THE CERTIFICATE MUST BE RATED, AT
THE TIME OF PURCHASE, NOT LOWER THAN "BBB-" (OR ITS EQUIVALENT) BY STANDARD &
POOR'S, FITCH, INC. OR XXXXX'X INVESTORS SERVICE, INC., AND THE CERTIFICATE IS
SO RATED OR (III) (1) IT IS AN INSURANCE COMPANY, (2) THE SOURCE OF FUNDS USED
TO ACQUIRE OR HOLD THE CERTIFICATE OR INTEREST HEREIN IS AN "INSURANCE COMPANY
GENERAL ACCOUNT", AS SUCH TERM IS DEFINED IN PROHIBITED TRANSACTION CLASS
EXEMPTION ("PTCE") 95-60, AND (3) THE CONDITIONS IN SECTIONS I AND III OF PTCE
95-60 HAVE BEEN SATISFIED. ]
Certificate No.1 Pass-Through Rate: [___]%
Class II-X[B] [Senior][Subordinate]
Date of Pooling and Servicing Agreement Aggregate Initial Notional Amount of this Subordinate
and Cut-off Date: Certificate as of the Cut-off Date: $[______]
June 1, 2005
First Distribution Date: Initial Notional Amount of this Subordinate Certificate
July 25, 2005 as of the Cut-off Date: $[______]
Master Servicer: CUSIP: [______]
Xxxxx Fargo Bank, National Association
Assumed Final Distribution Date:
[_____________]
PRIME MORTGAGE TRUST 2005-2
MORTGAGE PASS-THROUGH CERTIFICATE
SERIES 2005-2
evidencing a fractional undivided interest in the
distributions allocable to the Class II-X[B]
Certificates with respect to a portion of a Trust
Fund consisting primarily of a pool of fixed rate
mortgage loans secured by first liens on one-to-four
family residential properties sold by STRUCTURED
ASSET MORTGAGE INVESTMENTS II INC.
This Certificate is payable solely from the assets of the
Trust Fund, and does not represent an obligation of or interest in Structured
Asset Mortgage Investments II Inc., the Master Servicer, the Securities
Administrator or the Trustee referred to below or any of their affiliates or any
other person. Neither this Certificate nor the underlying Mortgage Loans are
guaranteed or insured by any governmental entity or by Structured Asset Mortgage
Investments II Inc., the Master Servicer, the Securities Administrator or the
Trustee or any of their affiliates or any other person. None of the Structured
Asset Mortgage Investments II Inc., the Master Servicer or any of their
affiliates will have any obligation with respect to any certificate or other
obligation secured by or payable from payments on the Certificates.
This certifies that Cede & Co. is the registered owner of the
Fractional Undivided Interest evidenced hereby in the beneficial ownership
interest of Certificates of the same Class as this Certificate in a portion of a
trust (the "Trust Fund") primarily consisting of fixed rate mortgage loans
secured by first liens on one- to four- family residential properties
(collectively, the "Mortgage Loans") sold by Structured Asset Mortgage
Investments II Inc. ("XXXX XX"). The Mortgage Loans were sold by EMC Mortgage
Corporation ("EMC") to XXXX XX. Xxxxx Fargo Bank, National Association ("Xxxxx
Fargo") will act as master servicer of the Mortgage Loans and as securities
administrator (the "Master Servicer" and the "Securities Administrator, which
terms includes any successors thereto under the Agreement referred to below).
The Trust Fund was created pursuant to the Pooling and Servicing Agreement dated
as of the Cut-off Date specified above (the "Agreement"), among XXXX XX, as
depositor (the "Depositor"), Xxxxx Fargo Bank, National Association as Master
Servicer and securities administrator (in such capacity, the "Securities
Administrator"), EMC Mortgage Corporation, as seller and company, and U.S. Bank
National Association, as trustee (the "Trustee"), a summary of certain of the
pertinent provisions of which is set forth hereafter. To the extent not defined
herein, capitalized terms used herein shall have the meaning ascribed to them in
the Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of its acceptance hereof assents and by which such
Holder is bound.
Interest on this Certificate will accrue during the month
prior to the month in which a Distribution Date (as hereinafter defined) occurs
on the Notional Amount hereof at a per annum rate equal to the Pass-Through Rate
set forth above and as further described in the Agreement. The Trustee will
distribute on the 25th day of each month, or, if such 25th day is not a Business
Day, the immediately following Business Day (each, a "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 calendar month preceding the month of such Distribution
Date, an amount equal to the product of the Fractional Undivided Interest
evidenced by this Certificate and the amount (of interest and principal, if any)
required to be distributed to the Holders of Certificates of the same Class as
this Certificate. The Assumed Final Distribution Date is the Distribution Date
in the month immediately following the month of the latest scheduled maturity
date of any Mortgage Loan and is not likely to be the date on which the Notional
Amount of this Class of Certificates will be reduced to zero.
Distributions on this Certificate will be made by the paying
Agent by check mailed to the address of the Person entitled thereto as such name
and address shall appear on the Certificate Register or, if such Person so
requests by notifying the Securities Administrator in writing as specified in
the Agreement by wire transfer. Notwithstanding the above, the final
distribution on this Certificate will be made after due notice by the paying
Agent of the pendency of such distribution and only upon presentation and
surrender of this Certificate at the office or agency appointed by the
Securities Administrator for that purpose and designated in such notice. The
Initial Notional Amount of this Certificate is set forth above. The Notional
Amount hereof will be reduced to the extent of distributions allocable to
principal hereon and any Realized Losses allocable hereto.
This Certificate is one of a duly authorized issue of
Certificates designated as set forth on the face hereof (the "Certificates").
The Certificates, in the aggregate, evidence the entire beneficial ownership
interest in the Trust Fund formed pursuant to the Agreement.
[For Class II-XB only:] [Each beneficial owner of this
Certificate or any interest herein shall be deemed to have represented, by
virtue of its acquisition or holding of this certificate or interest herein,
that either (i) it is not an employee benefit plan subject to the Employee
Retirement Income Security Act of 1974, as amended or section 4975 of the
Internal Revenue Code of 1986, as amended ("Plan"), or investing with assets of
a Plan or (ii) it has acquired and is holding such certificate in reliance on
Prohibited Transaction Exemption 90-30, as amended from time to time
("Exemption"), and that it understands that there are certain conditions to the
availability of the Exemption, including that the certificate must be rated, at
the time of purchase, not lower than "BBB-" (or its equivalent) by Standard &
Poor's, Fitch, Inc. or Xxxxx'x Investors Service, Inc., and the certificate is
so rated or (iii) (1) it is an insurance company, (2) the source of funds used
to acquire or hold the certificate or interest herein is an "insurance company
general account", as such term is defined in Prohibited Transaction Class
Exemption ("PTCE") 95-60, and (3) the conditions in Sections I and III of PTCE
95-60 have been satisfied.]
The Certificateholder, by its acceptance of this Certificate,
agrees that it will look solely to the Trust Fund for payment hereunder and that
the Trustee is not liable to the Certificateholders for any amount payable under
this Certificate or the Agreement or, except as expressly provided in the
Agreement, subject to any liability under the Agreement.
This Certificate does not purport to summarize the Agreement
and reference is made to the Agreement for the interests, rights and limitations
of rights, benefits, obligations and duties evidenced hereby, and the rights,
duties and immunities of the Trustee.
The Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor, the Master Servicer, the Securities Administrator
and the Trustee and the rights of the Certificateholders under the Agreement
from time to time by the parties thereto with the consent of the Holders of
Certificates, evidencing Fractional Undivided Interests aggregating not less
than 51% of the portion of the Trust Fund related to such Certificates (or in
certain cases, Holders of Certificates of affected Classes evidencing such
percentage of the Fractional Undivided Interests thereof). 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 lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates.
As provided in the Agreement and subject to certain
limitations therein set forth, the transfer of this Certificate is registrable
with the certificate registrar upon surrender of this Certificate for
registration of transfer at the offices or agencies maintained by the Securities
Administrator for such purposes, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Securities Administrator duly
executed by the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Certificates in authorized denominations
representing a like aggregate Fractional Undivided Interest will be issued to
the designated transferee.
The Certificates are issuable only as registered Certificates
without coupons in the Classes and denominations specified in the Agreement. As
provided in the Agreement and subject to certain limitations therein set forth,
this Certificate is exchangeable for one or more new Certificates evidencing the
same Class and in the same aggregate Fractional Undivided Interest, as requested
by the Holder surrendering the same.
No service charge will be made to the Certificateholders for
any such registration of transfer, but the Securities Administrator may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith. The Depositor, the Master Servicer, the
Securities Administrator, 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 none of the Depositor, the Master Servicer, the Securities
Administrator, the Trustee or any such agent shall be affected by notice to the
contrary.
The obligations created by the Agreement and the Trust Fund
created thereby (other than the obligations to make payments to
Certificateholders with respect to the termination of the Agreement) shall
terminate upon the earlier of (i) the later of the (A) final payment or other
liquidation (or Advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund and (B) disposition of all property acquired upon
foreclosure or deed in lieu of foreclosure of any Mortgage Loan and the
remittance of all funds due under the Agreement, or (ii) the optional repurchase
by the party named in the Agreement of all the Mortgage Loans and other assets
of the Trust Fund in accordance with the terms of the Agreement. Such optional
repurchase may be made only on or after the Distribution Date on which the
aggregate unpaid principal balance of the Mortgage Loans is less than the
percentage of the aggregate Outstanding Principal Balance specified in the
Agreement of the Mortgage Loans at the Cut-off Date. The exercise of such right
will effect the early retirement of the Certificates. In no event, however, will
the Trust Fund created by the Agreement continue beyond the earlier of (i) the
"latest possible maturity date" specified in Section 5.01(d) of the Agreement or
(ii) the expiration of 21 years after the death of certain persons identified in
the Agreement.
Unless this Certificate has been countersigned by an
authorized signatory of the Securities Administrator by manual signature, this
Certificate shall not be entitled to any benefit under the Agreement, or be
valid for any purpose.
IN WITNESS WHEREOF, the Securities Administrator has caused
this Certificate to be duly executed.
Dated: June 30, 2005 XXXXX FARGO BANK,
NATIONAL ASSOCIATION,
Not in its individual capacity but solely as
Securities Administrator
By:
----------------------------------------
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the
within-mentioned Agreement.
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
Authorized signatory of Xxxxx Fargo Bank,
National Association, not in its individual
capacity but solely as Securities
Administrator
By:
----------------------------------------
Authorized Signatory
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto __________________________________ (Please print or
typewrite name and address including postal zip code of assignee) a Fractional
Undivided Interest evidenced by the within Mortgage Pass-Through Certificate and
hereby authorizes the transfer of registration of such interest to assignee on
the Certificate Register of the Trust Fund.
I (We) further direct the Certificate Registrar to issue a new
Certificate of a like denomination and Class, to the above named assignee and
deliver such Certificate to the following address:
Dated:
---------------------------------------------
Signature by or on behalf of assignor
---------------------------------------------
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________ for the account
of _________________________ account number _____________, or, if mailed by
check, to ______________________________. Applicable statements should be mailed
to ____________________________________________________ .
This information is provided by __________________, the
assignee named above, or ________________________, as its agent.
EXHIBIT B
MORTGAGE LOAN SCHEDULE
The Preliminary and Final Mortgage Loan Schedules shall set
forth the following information with respect to each Mortgage Loan:
(a) the loan number;
(b) the Mortgagor's name;
(c) the street address (including city, state and zip code) of the Mortgaged
Property;
(d) the property type;
(e) the Mortgage Rate;
(f) the Servicer;
(g) the Servicing Rate;
(h) the Net Rate;
(i) the original term;
(j) the maturity date;
(k) the stated remaining term to maturity;
(l) the original principal balance;
(m) the first payment date;
(n) the principal and interest payment in effect as of the Cut-off Date;
(o) the unpaid principal balance as of the Cut-off Date;
(p) the Loan-to-Value Ratio at origination;
(q) paid-through date;
(r) the insurer of any Primary Mortgage Insurance Policy;
(s) the Gross Margin, if applicable;
(t) the Maximum Lifetime Mortgage Rate, if applicable;
(u) the Minimum Lifetime Mortgage Rate, if applicable;
(v) the Periodic Rate Cap, if applicable;
(w) the number of days delinquent, if any;
(x) which Mortgage Loans adjust after an initial fixed-rate period of three,
five, seven or ten years;
(y) The Loan Group; and
(z) The Prepayment Charge Loans.
Such schedule also shall set forth for all of the Mortgage Loans, the total
number of Mortgage Loans, the total of each of the amounts described under (k)
and (n) above, the weighted average by principal balance as of the Cut-off Date
of each of the rates described under (e), (f) and (g) above, and the weighted
average remaining term to maturity by unpaid principal balance as of the Cut-off
Date.
EXHIBIT C
[RESERVED]
EXHIBIT D
REQUEST FOR RELEASE OF DOCUMENTS
To: U.S. Bank National Association
Xxx Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxx, XX 00000
RE: Pooling and Servicing Agreement dated as of
June 1, 2005, among XXXX XX,
Xxxxx Fargo Bank,
National Association, as Master Servicer
and Securities Administrator,
EMC Mortgage Corporation, as Seller
and Company and U.S. Bank National Association as Trustee
In connection with the administration of the Mortgage Loans
held by you pursuant to the above-captioned Pooling and Servicing Agreement, we
request the release, and hereby acknowledge receipt, of the Mortgage File for
the Mortgage Loan described below, for the reason indicated.
MORTGAGE LOAN NUMBER:
MORTGAGOR NAME, ADDRESS & ZIP CODE:
REASON FOR REQUESTING DOCUMENTS (CHECK ONE):
_____ 1. Mortgage Paid in Full and proceeds have been deposited into the
Custodial Account
_____ 2. Foreclosure
_____ 3. Substitution
_____ 4. Other Liquidation
_____ 5. Nonliquidation Reason: _________________________
_____ 6. California Mortgage Loan paid in full
By:
-----------------------------
(authorized signer)
Issuer:
------------------------
Address:
-----------------------
Date:
----------------------------
EXHIBIT E
FORM OF AFFIDAVIT
Affidavit pursuant to Section 860E(e)(4)
of the Internal Revenue Code of 1986, as
amended, and for other purposes
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 Investor] (the
"Investor"), 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.
2. That (i) the Investor is not a "disqualified organization"
as defined in Section 860E(e)(5) of the Internal Revenue Code of 1986, as
amended (the "Code"), and will not be a disqualified organization as of [Closing
Date] [date of purchase]; (ii) it is not acquiring the Structured Asset Mortgage
Investments II Inc., Prime Mortgage Trust, [Mortgage Pass-Through
Certificates][Re-REMIC Certificates], Series 2005-2 [Class I-R Certificates]
[Class II-R Certificates] (the "Residual Certificates") for the account of a
disqualified organization; (iii) it consents to any amendment of the Pooling and
Servicing Agreement that shall be deemed necessary by Structured Asset Mortgage
Investments II Inc. (upon advice of counsel) to constitute a reasonable
arrangement to ensure that the Residual Certificates will not be owned directly
or indirectly by a disqualified organization; and (iv) it will not transfer such
Residual Certificates unless (a) it has received from the transferee an
affidavit in substantially the same form as this affidavit containing these same
four representations and (b) as of the time of the transfer, it does not have
actual knowledge that such affidavit is false.
3. That the Investor is one of the following: (i) a citizen or
resident of the United States, (ii) a corporation or partnership (including an
entity treated as a corporation or partnership for federal income tax purposes)
created or organized in, or under the laws of, the United States or any state
thereof or the District of Columbia (except, in the case of a partnership, to
the extent provided in regulations), provided that no partnership or other
entity treated as a partnership for United States federal income tax purposes
shall be treated as a United States Person unless all persons that own an
interest in such partnership either directly or through any entity that is not a
corporation for United States federal income tax purposes are United States
Persons, (iii) an estate whose income is subject to United States federal income
tax regardless of its source, or (iv) a trust other than a "foreign trust," as
defined in Section 7701 (a)(31) of the Code.
4. That the Investor's taxpayer identification number is
________________.
5. That no purpose of the acquisition of the Residual
Certificates is to avoid or impede the assessment or collection of tax.
6. That the Investor understands that, as the holder of the
Residual Certificates, the Investor may incur tax liabilities in excess of any
cash flows generated by such Residual Certificates.
7. That the Investor intends to pay taxes associated with
holding the Residual Certificates as they become due.
IN WITNESS WHEREOF, the Investor has caused this instrument to
be executed on its behalf, pursuant to authority of its Board of Directors, by
its [Title of Officer] this ____ day of _________, 20__.
[NAME OF INVESTOR]
By:
--------------------------------------
[Name of Officer]
[Title of Officer]
[Address of Investor for receipt of
distributions]
Address of Investor for receipt of tax
information:
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 Investor, and acknowledged to
me that he executed the same as his free act and deed and the free act and deed
of the Investor.
Subscribed and sworn before me this ___ day of _________, 20___.
NOTARY PUBLIC
COUNTY OF
STATE OF
My commission expires the ___ day of ___________________, 20___.
EXHIBIT F-1
FORM OF INVESTMENT LETTER
[Date]
[SELLER]
U.S. Bank National Association
Xxx Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxx, XX 00000
Structured Asset Mortgage Investments II Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Structured Asset Mortgage Investments II Inc., Prime Mortgage Trust,
Series 2005-2 Mortgage Pass-Through Certificates (the "Certificates"),
including the [Class I-B-4, Class I-B-5 and Class I-B-6 Certificates
(the "Private Mortgage Pass-Through Certificates")] [Class II-A-1,
Class II-A-2, Class II-A-3, Class II-A-4 and Class II-a-5 Certificates
(The "Re-REMIC Certificates")]
----------------------------------------------------------------------
Dear Ladies and Gentlemen:
In connection with our purchase of the [Private Mortgage
Pass-Through Certificates][Re-REMIC Certificates], we confirm that:
(i) we understand that the [Private Mortgage Pass-Through
Certificates][Re-REMIC Certificates] are not being
registered under the Securities Act of 1933, as
amended (the "Act") or any applicable state
securities or "Blue Sky" laws, and are being sold to
us in a transaction that is exempt from the
registration requirements of such laws;
(ii) any information we desired concerning the
Certificates, including the [Private Mortgage
Pass-Through Certificates][Re-REMIC Certificates],
the trust in which the Certificates represent the
entire beneficial ownership interest (the "Trust") or
any other matter we deemed relevant to our decision
to purchase [Private Mortgage Pass-Through
Certificates][Re-REMIC Certificates] has been made
available to us;
(iii) we are able to bear the economic risk of investment
in [Private Mortgage Pass-Through
Certificates][Re-REMIC Certificates]; we are an
institutional "accredited investor" as defined in
Section 501(a) of Regulation D promulgated under the
Act and a sophisticated institutional investor;
(iv) we are acquiring [Private Mortgage Pass-Through
Certificates][Re-REMIC Certificates] for our own
account, not as nominee for any other person, and not
with a present view to any distribution or other
disposition of the [Private Mortgage Pass-Through
Certificates][Re-REMIC Certificates];
(v) we agree the [Private Mortgage Pass-Through
Certificates][Re-REMIC Certificates] must be held
indefinitely by us (and may not be sold, pledged,
hypothecated or in any way disposed of) unless
subsequently registered under the Act and any
applicable state securities or "Blue Sky" laws or an
exemption from the registration requirements of the
Act and any applicable state securities or "Blue Sky"
laws is available;
(vi) we agree that in the event that at some future time
we wish to dispose of or exchange any of the [Private
Mortgage Pass-Through Certificates][Re-REMIC
Certificates] (such disposition or exchange not being
currently foreseen or contemplated), we will not
transfer or exchange any of the [Private Mortgage
Pass-Through Certificates][Re-REMIC Certificates]
unless:
(A) (1) the sale is to an Eligible Purchaser
(as defined below), (2) if required by the Pooling
and Servicing Agreement (as defined below) a letter
to substantially the same effect as either this
letter or, if the Eligible Purchaser is a Qualified
Institutional Buyer as defined under Rule 144A of the
Act, the Rule 144A and Related Matters Certificate in
the form attached to the Pooling and Servicing
Agreement (as defined below) (or such other
documentation as may be acceptable to the Trustee) is
executed promptly by the purchaser and delivered to
the addressees hereof and (3) all offers or
solicitations in connection with the sale, whether
directly or through any agent acting on our behalf,
are limited only to Eligible Purchasers and are not
made by means of any form of general solicitation or
general advertising whatsoever; and
(B) if the [Private Mortgage Pass-Through
Certificates][Re-REMIC Certificates] is not
registered under the Act (as to which we acknowledge
you have no obligation), the [Private Mortgage
Pass-Through Certificates][Re-REMIC Certificates] is
sold in a transaction that does not require
registration under the Act and any applicable state
securities or "blue sky" laws and, if U.S. Bank
National Association (the "Trustee") so requests, a
satisfactory Opinion of Counsel is furnished to such
effect, which Opinion of Counsel shall be an expense
of the transferor or the transferee;
(vii) we agree to be bound by all of the terms (including
those relating to restrictions on transfer) of the
Pooling and Servicing, pursuant to which the Trust
was formed; we have reviewed carefully and understand
the terms of the Pooling and Servicing Agreement;
(viii) we either: (i) are not acquiring the [Private
Mortgage Pass-Through Certificates][Re-REMIC
Certificates] directly or indirectly by, or on behalf
of, an employee benefit plan or other retirement
arrangement which is subject to Title I of the
Employee Retirement Income Security Act of 1974, as
amended, or section 4975 of the Internal Revenue Code
of 1986, as amended, or (ii) are providing a
representation to the effect that the proposed
transfer and holding of a [Private Mortgage
Pass-Through Certificates][Re-REMIC Certificates] and
the servicing, management and operation of the Trust
and its assets: (I) will not result in any prohibited
transaction which is not covered under an individual
or class prohibited transaction exemption, including,
but not limited to, Prohibited Transaction Exemption
("PTE") 84-14, XXX 00-00, XXX 00-0, XXX 95-60, or PTE
96-23 and (II) will not give rise to any additional
obligations on the part of the Depositor, the Master
Servicer, the Securities Administrator or the Trustee
or (iii) have attached hereto the opinion specified
in Section 5.07 of the Agreement.
(ix) We understand that each of the [Private Mortgage
Pass-Through Certificates][Re-REMIC Certificates]
bears, and will continue to bear, a legend to
substantiate the following effect: "THIS CERTIFICATE
HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), OR UNDER ANY STATE SECURITIES LAWS. THE HOLDER
HEREOF, BY PURCHASING THIS CERTIFICATE, AGREES THAT
THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR
OTHERWISE TRANSFERRED ONLY IN COMPLIANCE WITH THE
SECURITIES ACT AND OTHER APPLICABLE LAWS AND ONLY (1)
PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE
144A") TO A PERSON THAT THE HOLDER REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN
THE MEANING OF RULE 144A (A "QIB"), PURCHASING FOR
ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT
OF A QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE,
THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS
BEING MADE IN RELIANCE ON RULE 144A, (2) PURSUANT TO
AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144
UNDER THE SECURITIES ACT (IF AVAILABLE) OR (3) IN
CERTIFICATED FORM TO AN "INSTITUTIONAL ACCREDITED
INVESTOR" WITHIN THE MEANING THEREOF IN RULE
501(a)(1), (2), (3) or (7) OF REGULATION D UNDER THE
ACT OR ANY ENTITY IN WHICH ALL OF THE EQUITY OWNERS
COME WITHIN SUCH PARAGRAPHS PURCHASING NOT FOR
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT,
SUBJECT TO (A) THE RECEIPT BY THE TRUSTEE OF A LETTER
SUBSTANTIALLY IN THE FORM PROVIDED IN THE AGREEMENT
AND (B) THE RECEIPT BY THE TRUSTEE OF SUCH OTHER
EVIDENCE ACCEPTABLE TO THE TRUSTEE THAT SUCH REOFFER,
RESALE, PLEDGE OR TRANSFER IS IN COMPLIANCE WITH THE
SECURITIES ACT AND OTHER APPLICABLE LAWS OR IN EACH
CASE IN ACCORDANCE WITH ALL APPLICABLE SECURITIES
LAWS OF THE UNITED STATES AND ANY OTHER APPLICABLE
JURISDICTION. THIS CERTIFICATE MAY NOT BE ACQUIRED
DIRECTLY OR INDIRECTLY BY, OR ON BEHALF OF, AN
EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT
WHICH IS SUBJECT TO TITLE I OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED,
OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986,
AS AMENDED, UNLESS THE PROPOSED TRANSFER AND HOLDING
OF A CERTIFICATE AND THE SERVICING, MANAGEMENT AND
OPERATION OF THE TRUST AND ITS ASSETS: (1) WILL NOT
RESULT IN ANY PROHIBITED TRANSACTION WHICH IS NOT
COVERED UNDER AN INDIVIDUAL OR CLASS PROHIBITED
TRANSACTION EXEMPTION, INCLUDING, BUT NOT LIMITED TO,
PROHIBITED TRANSACTION EXEMPTION ("PTE") 84-14, XXX
00-00, XXX 00-0, XXX 95-60 OR PTE 96-23 AND (II) WILL
NOT GIVE RISE TO ANY ADDITIONAL OBLIGATIONS ON THE
PART OF THE DEPOSITOR, THE MASTER SERVICER, THE
SECURITIES ADMINISTRATOR OR THE TRUSTEE, WHICH WILL
BE DEEMED REPRESENTED BY AN OWNER OF A BOOK-ENTRY
CERTIFICATE OR A GLOBAL CERTIFICATE OR UNLESS THE
OPINION PROVIDED IN SECTION 5.07 OF THE AGREEMENT IS
PROVIDED."
"ELIGIBLE PURCHASER" means a corporation, partnership or other
entity which we have reasonable grounds to believe and do believe (i) can make
representations with respect to itself to substantially the same effect as the
representations set forth herein, and (ii) is either a Qualified Institutional
Buyer as defined under Rule 144A of the Act or an institutional "Accredited
Investor" as defined under Rule 501 of the Act.
Terms not otherwise defined herein shall have the meanings
assigned to them in the Pooling and Servicing Agreement, dated as of June 1,
2005, among Structured Asset Mortgage Investments II Inc., Xxxxx Fargo Bank,
National Association as master servicer and securities administrator, EMC
Mortgage Corporation, as seller and company and U.S. Bank National Association
as Trustee (the "Pooling and Servicing Agreement').
If the Purchaser proposes that its Certificates be registered
in the name of a nominee on its behalf, the Purchaser has identified such
nominee below, and has caused such nominee to complete the Nominee
Acknowledgment at the end of this letter.
Name of Nominee (if any): ____________________
IN WITNESS WHEREOF, this document has been executed by the
undersigned who is duly authorized to do so on behalf of the undersigned
Eligible Purchaser on the ___ day of ________, 20___.
Very truly yours,
[PURCHASER]
By:
------------------------------
(Authorized Officer)
[By:
------------------------------
Attorney-in-fact]
Nominee Acknowledgment
The undersigned hereby acknowledges and agrees that as to the
Certificates being registered in its name, the sole beneficial owner thereof is
and shall be the Purchaser identified above, for whom the undersigned is acting
as nominee.
[NAME OF NOMINEE]
By:
------------------------------
(Authorized Officer)
[By:
-----------------------------
Attorney-in-fact]
EXHIBIT F-2
FORM OF RULE 144A AND RELATED MATTERS CERTIFICATE
[SELLER] [Date]
U.S. Bank National Association
Xxx Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxx, XX 00000
Structured Asset Mortgage Investments II Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Structured Asset Mortgage Investments II Inc., Prime Mortgage Trust,
Series 2005-2 Mortgage Pass-Through Certificates (the "Certificates"),
including the [Class I-B-4, Class I-B-5 and Class I-B-6 Certificates
(the "Private Mortgage Pass-Through Certificates")] [Class II-A-1,
Class II-A-2, Class II-A-3, Class II-A-4 and Class II-A-5 Certificates
(The "Re-REMIC Certificates")]
----------------------------------------------------------------------
Dear Ladies and Gentlemen:
In connection with our purchase of [Private Mortgage
Pass-Through Certificates][Re-REMIC Certificates], the undersigned certifies to
each of the parties to whom this letter is addressed that it is a qualified
institutional buyer (as defined in Rule 144A under the Securities Act of 1933,
as amended (the "Act")) as follows:
1. It owned and/or invested on a discretionary basis eligible securities
(excluding affiliate's securities, bank deposit notes and CD's, loan
participations, repurchase agreements, securities owned but subject to
a repurchase agreement and swaps), as described below:
Date: ______________, 20__ (must be on or after the close of its most
recent fiscal year)
Amount: $ _____________________; and
2. The dollar amount set forth above is:
a. greater than $100 million and the undersigned is one of the
following entities:
(x) [ ] an insurance company as defined in Section
2(13) of the Act(1); or
----------------
(1) A purchase by an insurance company for one or more of its separate accounts,
as defined by Section 2(a)(37) of the Investment Company Act of 1940, which
are neither registered nor required to be registered thereunder, shall be
deemed to be a purchase for the account of such insurance company.
(y) [ ] an investment company registered under the
Investment Company Act or any business
development company as defined in Section
2(a)(48) of the Investment Company Act of
1940; or
(z) [ ] 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; or
(aa) [ ] a plan (i) established and maintained by a
state, its political subdivisions, or any
agency or instrumentality of a state or its
political subdivisions, the laws of which
permit the purchase of securities of this
type, for the benefit of its employees and
(ii) the governing investment guidelines of
which permit the purchase of securities of
this type; or
(bb) [ ] a business development company as defined
in Section 202(a)(22) of the Investment
Advisers Act of 1940; or
(cc) [ ] a corporation (other than a U.S. bank,
savings and loan association or equivalent
foreign institution), partnership,
Massachusetts or similar business trust, or
an organization described in Section
501(c)(3) of the Internal Revenue Code; or
(dd) [ ] a U.S. bank, savings and loan association
or equivalent foreign institution, which has
an audited net worth of at least $25 million
as demonstrated in its latest annual
financial statements; or
(ee) [ ] an investment adviser registered under the
Investment Advisers Act; or
b. [ ] greater than $10 million, and the
undersigned is a broker-dealer registered
with the SEC; or
c. [ ] less than $10 million, and the undersigned
is a broker-dealer registered with the SEC
and will only purchase Rule 144A securities
in transactions in which it acts as a
riskless principal (as defined in Rule
144A); or
d. [ ] less than $100 million, and the undersigned
is an investment company registered under
the Investment Company Act of 1940, which,
together with one or more registered
investment companies having the same or an
affiliated investment adviser, owns at least
$100 million of eligible securities; or
e. [ ] less than $100 million, and the undersigned
is an entity, all the equity owners of which
are qualified institutional buyers.
The undersigned further certifies that it is purchasing a
[Private Mortgage Pass-Through Certificates][Re-REMIC Certificates] for its own
account or for the account of others that independently qualify as "Qualified
Institutional Buyers" as defined in Rule 144A. It is aware that the sale of the
[Private Mortgage Pass-Through Certificates][Re-REMIC Certificates] is being
made in reliance on its continued compliance with Rule 144A. It is aware that
the transferor may rely on the exemption from the provisions of Section 5 of the
Act provided by Rule 144A. The undersigned understands that the [Private
Mortgage Pass-Through Certificates][Re-REMIC Certificates] may be resold,
pledged or transferred only to (i) 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 in Rule 144A, or (ii) an
institutional "accredited investor," as such term is defined under Rule 501 of
the Act in a transaction that otherwise does not constitute a public offering.
The undersigned agrees that if at some future time it wishes
to dispose of or exchange any of the [Private Mortgage Pass-Through
Certificates][Re-REMIC Certificates], it will not transfer or exchange any of
the Privately Offered Certificates to a Qualified Institutional Buyer without
first obtaining a Rule 144A and Related Matters Certificate in the form hereof
from the transferee and delivering such certificate to the addressees hereof.
Prior to making any transfer of [Private Mortgage Pass-Through
Certificates][Re-REMIC Certificates], if the proposed Transferee is an
institutional "accredited investor," the transferor shall obtain from the
transferee and deliver to the addressees hereof an Investment Letter in the form
attached to the Pooling and Servicing Agreement, dated as of June 1, 2005, among
Structured Asset Mortgage Investments II Inc., Xxxxx Fargo Bank, N.A., EMC
Mortgage Corporation and U.S. Bank National Association, as Trustee, pursuant to
Certificates were issued.
The undersigned certifies that it either: (i) is not acquiring
the [Private Mortgage Pass-Through Certificates][Re-REMIC Certificates] directly
or indirectly by, or on behalf of, an employee benefit plan or other retirement
arrangement which is subject to Title I of the Employee Retirement Income
Security Act of 1974, as amended, or section 4975 of the Internal Revenue Code
of 1986, as amended, or (ii) is providing a representation or an opinion of
counsel to the effect that the proposed transfer and holding of a [Private
Mortgage Pass-Through Certificates][Re-REMIC Certificates] and the servicing,
management and operation of the Trust and its assets: (I) will not result in any
prohibited transaction which is not covered under a prohibited transaction
exemption, including, but not limited to, Prohibited Transaction Exemption
("PTE") 84-14, XXX 00-00, XXX 00-0, XXX 00-00, XXX 00-00 and (II) will not give
rise to any additional obligations on the part of the Depositor, the Master
Servicer, the Securities Administrator or the Trustee or (iii) has attached
hereto the opinion specified in Section 5.07 of the Agreement.
If the Purchaser proposes that its Certificates be registered
in the name of a nominee on its behalf, the Purchaser has identified such
nominee below, and has caused such nominee to complete the Nominee
Acknowledgment at the end of this letter.
Name of Nominee (if any):
IN WITNESS WHEREOF, this document has been executed by the
undersigned who is duly authorized to do so on behalf of the undersigned
Eligible Purchaser on the ____ day of ___________, 20___.
Very truly yours,
[PURCHASER]
By:
----------------------------------------
(Authorized Officer)
[By:
----------------------------------------
Attorney-in-fact]
NOMINEE ACKNOWLEDGMENT
The undersigned hereby acknowledges and agrees that as to the
Certificates being registered in its name, the sole beneficial owner thereof is
and shall be the Purchaser identified above, for whom the undersigned is acting
as nominee.
[NAME OF NOMINEE]
By:
----------------------------------------
(Authorized Officer)
[By:
----------------------------------------
Attorney-in-fact]
EXHIBIT F-3
FORM OF TRANSFER CERTIFICATE FOR EXCHANGE OR
TRANSFER FROM RULE 144A GLOBAL CERTIFICATE TO
REGULATION S GLOBAL CERTIFICATE
U.S. Bank National Association,
as Trustee
Xxx Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxx, XX 00000
Reference is hereby made to the Pooling and Servicing
Agreement ("Pooling and Servicing Agreement"), dated as of June 1, 2005, among
Structured Asset Mortgage Investments II Inc., as Depositor, Xxxxx Fargo Bank,
National Association, as Master Servicer and Securities Administrator, EMC
Mortgage Corporation, as Seller and Company and U.S. Bank National Association
as Trustee. Capitalized terms used but not defined herein are used as defined in
the Pooling and Servicing Agreement:
The undersigned (the "TRANSFEROR") owns and proposes to
transfer the interests in the Rule 144A Global Certificates specified in Annex A
hereto (the "CERTIFICATES") to __________ (the "Transferee"), in the principal
amounts in such Rule 144A Global Certificates (the "TRANSFER") as further
specified in Annex A hereto. In connection with the Transfer, the Transferor
hereby certifies that:
(a) the Transfer is being effected in accordance with transfer
restrictions set forth in the Pooling and Servicing Agreement
and the Certificates;
(b) the Transfer is being effected pursuant to and in accordance
with Rule 903 or Rule 904 under the Securities Act of 1933, as
amended (the "SECURITIES ACT") and, accordingly, the
Transferor hereby further certifies that:
(i) the Transfer is not being made to a person in the
United States and (x) at the time the buy order was
originated, the Transferee was outside the United
States or the Transferor and each Person acting on
its behalf reasonably believed and believes that the
Transferee was outside the United States or (y) the
transaction was executed in, on or through the
facilities of a "designated offshore securities
market" (as defined Rule 902 of Regulation S under
the Securities Act) and neither the Transferor nor
any Person acting on its behalf knows that the
transaction was prearranged with a buyer in the
United States,
(ii) no directed selling efforts have been made in
contravention of the requirements of Rule 903 or Rule
904 of Regulation S under the Securities Act, and
(iii) the transaction is not part of a plan or scheme to
evade the registration requirements of the Securities
Act.
Upon consummation of the proposed transfer in accordance with
the terms of the Pooling and Servicing Agreement, the transferred beneficial
interest will be subject to the restrictions on transfer enumerated in the
legends printed on the Regulation S Global Certificates by which the Transferee
shall hold its interest and in the Pooling and Servicing Agreement and the
Securities Act.
Dated: Very truly yours,
[Name of Transferor]
By:
------------------------------
Name:
Title:
ANNEX A
The Transferor owns and proposes to transfer a beneficial interest in the
following:
(i) [ ] Class [___] Rule 144A Global Certificate, principal amount of
$_____________,
(ii) [ ] Class [___] Rule 144A Global Certificate, principal amount of
$_____________, or
(iii) [ ] Class [___] Rule 144A Global Certificate, principal amount of
$_____________.
EXHIBIT F-4
FORM OF TRANSFER CERTIFICATE FOR EXCHANGE OR
TRANSFER FROM REGULATION S GLOBAL CERTIFICATE TO
RULE 144A GLOBAL CERTIFICATE
U.S. Bank National Association
as Trustee
Xxx Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxx, XX 00000
Reference is hereby made to the Pooling and Servicing
Agreement ("Pooling and Servicing Agreement"), dated as of June 1, 2005, among
Structured Asset Mortgage Investments II Inc., as Depositor, Xxxxx Fargo Bank,
National Association, as Master Servicer and Securities Administrator, EMC
Mortgage Corporation, as Seller and Company and U.S. Bank National Association
as Trustee. Capitalized terms used but not defined herein are used as defined in
the Pooling and Servicing Agreement:
The undersigned (the "TRANSFEROR") owns and proposes to
transfer the interests in the Regulation S Global Certificates specified in
Annex A hereto (the "CERTIFICATES"), in the principal amounts in such Regulation
S Global Certificates (the "TRANSFER"), as further specified in Annex A hereto.
In connection with the Transfer, the Transferor hereby certifies that:
(a) the Transfer is being effected in accordance with transfer
restrictions set forth in the Pooling and Servicing Agreement and the
Certificates;
(b) the Transfer is being effected pursuant to and in accordance with
Rule 144A under the Securities Act of 1933, as amended (the
"SECURITIES ACT"), and, accordingly, the Transferor hereby further
certifies that:
(i) the Transferee is purchasing the beneficial interest for its
own account, or for one or more accounts with respect to which
the Transferee exercises sole investment discretion,
(ii) the Transferor reasonably believes that the Transferee and
each such account is a "qualified institutional buyer" within
the meaning of Rule 144A, and
(iii) the Transfer is in compliance with any applicable blue sky
securities laws of any state of the United States.
Upon consummation of the proposed Transfer in accordance with
the terms of the Pooling and Servicing Agreement, the transferred beneficial
interest will be subject to the restrictions on transfer enumerated in the
legends printed on the Rule 144A Global Certificates by which the Transferee
shall hold its interest and in the Pooling and Servicing Agreement and the
Securities Act.
Dated: Very truly yours,
[Name of Transferor]
By:
------------------------------
Name:
Title:
ANNEX A
The Transferor owns and proposes to transfer a beneficial interest in the
following:
(i) [ ] Class [___] Regulation S Global Certificate, principal amount
of $_____________,
(ii) [ ] Class [___] Regulation S Global Certificate, principal amount
of $_____________, or
(iii) [ ] Class [___] Regulation S Global Certificate, principal amount
of $_____________.
EXHIBIT G
CUSTODIAL AGREEMENT
THIS CUSTODIAL AGREEMENT (as amended and supplemented from
time to time, the "Agreement'), dated as of June 30, 2005, by and among U.S.
BANK NATIONAL ASSOCATION not individually but solely as trustee under the
Pooling and Servicing Agreement defined below (including its successors under
the Pooling and Servicing Agreement defined below, the "Trustee"), STRUCTURED
ASSET MORTGAGE INVESTMENTS II INC., as depositor (together with any successor in
interest, the "Depositor"), XXXXX FARGO BANK, NATIONAL ASSOCIATION, as master
servicer and securities administrator (together with any successor in interest
or successor under the Pooling and Servicing Agreement referred to below, the
"Master Servicer") and XXXXX FARGO BANK, NATIONAL ASSOCIATION, as custodian
(together with any successor in interest or any successor appointed hereunder,
the "Custodian").
WITNESSETH THAT:
WHEREAS, the Depositor, the Master Servicer, the Trustee and
EMC Mortgage Corporation, as seller and company (the "Seller") have entered into
a Pooling and Servicing Agreement, dated as of June 1, 2005, relating to the
issuance of Prime Mortgage Trust, Mortgage Pass-Through Certificates, Series
2005-2 (as in effect on the date of this agreement, the "Original Pooling and
Servicing Agreement," and as amended and supplemented from time to time, the
"Pooling and Servicing Agreement'); and
WHEREAS, the Custodian has agreed to act as agent for the
Trustee for the purposes of receiving and holding certain documents and other
instruments delivered by the Depositor or the Master Servicer under the Pooling
and Servicing Agreement and the Servicers under their respective Servicing
Agreements, all upon the terms and conditions and subject to the limitations
hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the
mutual covenants and agreements hereinafter set forth, the Trustee, the
Depositor, the Master Servicer and the Custodian hereby agree as follows:
DEFINITIONS
Capitalized terms used in this Agreement and not defined
herein shall have the meanings assigned in the Original Pooling and Servicing
Agreement, unless otherwise required by the context herein.
CUSTODY OF MORTGAGE DOCUMENTS
(a) CUSTODIAN TO ACT AS AGENT: ACCEPTANCE OF MORTGAGE FILES.
The Custodian, as the duly appointed custodial agent of the Trustee for these
purposes, acknowledges (subject to any exceptions noted in the Initial
Certification referred to in Section 2.3(a)), receipt of the Mortgage Files
relating to the Mortgage Loans identified on the schedule attached hereto (the
"Mortgage Files") and declares that it holds and will hold such Mortgage Files
as agent for the Trustee, in trust, for the use and benefit of all present and
future Certificateholders.
(b) RECORDATION OF ASSIGNMENTS. If any Mortgage File includes
one or more assignments of Mortgage to the Trustee in a state which is
specifically excluded from the Opinion of Counsel delivered by the Seller to the
Trustee and the Custodian pursuant to the provisions of Section 2.01 of the
Pooling and Servicing Agreement, each such assignment shall be delivered by the
Custodian to the Depositor for the purpose of recording it in the appropriate
public office for real property records, and the Depositor, at no expense to the
Custodian, shall promptly cause to be recorded in the appropriate public office
for real property records each such assignment of Mortgage and, upon receipt
thereof from such public office, shall return each such assignment of Mortgage
to the Custodian.
(c) REVIEW OF MORTGAGE FILES.
(i) On or prior to the Closing Date, in accordance with
Section 2.02 of the Pooling and Servicing Agreement, the Custodian shall deliver
to the Trustee an Initial Certification in the form annexed hereto as Exhibit
One evidencing receipt (subject to any exceptions noted therein) of a Mortgage
File for each of the Mortgage Loans listed on the Schedule attached hereto (the
"Mortgage Loan Schedule").
(ii) Within 90 days of the Closing Date, the Custodian agrees,
for the benefit of the Holders of the Mortgage Pass-Through Certificates, to
review, in accordance with the provisions of Section 2.02 of the Pooling and
Servicing Agreement, each such document, and shall deliver to the Depositor and
the Trustee an Interim Certification in the form annexed hereto as Exhibit Two
to the effect that all such documents have been executed and received and that
such documents relate to the Mortgage Loans identified on the Mortgage Loan
Schedule, except for any exceptions listed on Schedule A attached to such
Interim Certification. The Custodian shall be under no duty or obligation to
inspect, review or examine said documents, instruments, certificates or other
papers to determine that the same are genuine, enforceable, or appropriate for
the represented purpose or that they have actually been recorded or that they
are other than what they purport to be on their face.
(iii) Not later than 180 days after the Closing Date, the
Custodian shall review the Mortgage Files as provided in Section 2.02 of the
Pooling and Servicing Agreement and deliver to the Depositor and the Trustee a
Final Certification in the form annexed hereto as Exhibit Three evidencing the
completeness of the Mortgage Files.
(iv) In reviewing the Mortgage Files as provided herein and in
the Pooling and Servicing Agreement, the Custodian shall make no representation
as to and shall not be responsible to verify (i) the validity, legality,
enforceability, due authorization, recordability, sufficiency or genuineness of
any of the documents included in any Mortgage File or (ii) the collectibility,
insurability, effectiveness or suitability of any of the documents in any
Mortgage File.
Upon receipt of written request from the Trustee, the
Custodian shall as soon as practicable supply the Trustee with a list of all of
the documents relating to the Mortgage Loans missing from the Mortgage Files.
(d) NOTIFICATION OF BREACHES OF REPRESENTATIONS AND
WARRANTIES. Upon discovery by the Custodian of a breach of any representation or
warranty made by the Depositor as set forth in the Pooling and Servicing
Agreement with respect to a Mortgage Loan relating to a Mortgage File, the
Custodian shall give prompt written notice to the Depositor, the related
Servicer and the Trustee.
(e) CUSTODIAN TO COOPERATE; RELEASE OF MORTGAGE FILES. Upon
receipt of written notice from the Trustee that the Seller has repurchased a
Mortgage Loan pursuant to Article II of the Pooling and Servicing Agreement, and
that the purchase price therefore has been deposited in the Master Servicer
Collection Account or the Distribution Account, then the Custodian agrees to
promptly release to the Seller the related Mortgage File.
Upon the Custodian's receipt of a request for release (a
"Request for Release") substantially in the form of Exhibit D to the Pooling and
Servicing Agreement signed by a Servicing Officer of the related Servicer
stating that it has received payment in full of a Mortgage Loan or that payment
in full will be escrowed in a manner customary for such purposes, the Custodian
agrees promptly to release to the related Servicer the related Mortgage File.
The Depositor shall deliver to the Custodian and the Custodian agrees to accept
the Mortgage Note and other documents constituting the Mortgage File with
respect to any Substitute Mortgage Loan.
From time to time as is appropriate for the servicing or
foreclosure of any Mortgage Loan, including, for this purpose, collection under
any Primary Insurance Policy, the related Servicer (or if the Servicer does not,
the Master Servicer) shall deliver to the Custodian a Request for Release signed
by a Servicing Officer requesting that possession of all of the Mortgage File be
released to the related Servicer and certifying as to the reason for such
release and that such release will not invalidate any insurance coverage
provided in respect of the Mortgage Loan under any of the Insurance Policies.
Upon receipt of the foregoing, the Custodian shall deliver the Mortgage File to
the related Servicer. The related Servicer shall cause each Mortgage File or any
document therein so released to be returned to the Custodian when the need
therefore by the related Servicer no longer exists, unless (i) the Mortgage Loan
has been liquidated and the Liquidation Proceeds relating to the Mortgage Loan
have been deposited in the Master Servicer Collection Account or the
Distribution Account or (ii) the Mortgage File or such document has been
delivered to an attorney, or to a public trustee or other public official as
required by law, for purposes of initiating or pursuing legal action or other
proceedings for the foreclosure of the Mortgaged Property either judicially or
non-judicially, and the related Servicer has delivered to the Custodian a
certificate of a Servicing Officer certifying as to the name and address of the
Person to which such Mortgage File or such document was delivered and the
purpose or purposes of such delivery.
At any time that a Servicer is required to deliver to the
Custodian a Request for Release, the Servicer shall deliver two copies of the
Request for Release if delivered in hard copy or the Servicer may furnish such
Request for Release electronically to the Custodian, in which event the
Servicing Officer transmitting the same shall be deemed to have signed the
Request for Release. In connection with any Request for Release of a Mortgage
File because of a repurchase of a Mortgage Loan, such Request for Release shall
be followed by an assignment of mortgage, without recourse, representation or
warranty from the Trustee to the Seller and the related Mortgage Note shall be
endorsed without recourse, representation or warranty by the Trustee and be
returned to the Seller provided, however, that in the case of a Mortgage Loan
that is registered on the MERS System, no assignment of mortgage or endorsement
of the Mortgage Note by the Trustee shall be required. In connection with any
Request for Release of a Mortgage File because of the payment in full of a
Mortgage Loan, such Request for Release shall be accompanied by a certificate of
satisfaction or other similar instrument to be executed by or on behalf of the
Trustee and returned to the related Servicer.
(f) ASSUMPTION AGREEMENTS. In the event that any assumption
agreement, substitution of liability agreement or sale of servicing agreement is
entered into with respect to any Mortgage Loan subject to this Agreement in
accordance with the terms and provisions of the Pooling and Servicing Agreement,
the Master Servicer, to the extent provided in the related Servicing Agreement,
shall cause the related Servicer to notify the Custodian that such assumption or
substitution agreement has been completed by forwarding to the Custodian the
original of such assumption or substitution agreement, which shall be added to
the related Mortgage File and, for all purposes, shall be considered a part of
such Mortgage File to the same extent as all other documents and instruments
constituting parts thereof.
CONCERNING THE CUSTODIAN
(a) CUSTODIAN AS BAILEE AND AGENT OF THE TRUSTEE. With respect
to each Mortgage Note, Mortgage and other documents constituting each Mortgage
File which are delivered to the Custodian, the Custodian is exclusively the
bailee and custodial agent of the Trustee and has no instructions to hold any
Mortgage Note or Mortgage for the benefit of any person other than the Trustee
and the Certificateholders and undertakes to perform such duties and only such
duties as are specifically set forth in this Agreement and in the Pooling and
Servicing Agreement. Except upon compliance with the provisions of Section 2.5
of this Agreement, no Mortgage Note, Mortgage or Mortgage File shall be
delivered by the Custodian to the Depositor, the Servicers or the Master
Servicer or otherwise released from the possession of the Custodian.
(b) CUSTODIAN MAY OWN MORTGAGE PASS-THROUGH CERTIFICATES. The
Custodian in its individual or any other capacity may become the owner or
pledgee of Mortgage Pass-Through Certificates with the same rights it would have
if it were not Custodian.
(c) MASTER SERVICER TO PAY CUSTODIAN'S FEES AND EXPENSES. The
Master Servicer covenants and agrees to pay to the Custodian from time to time,
and the Custodian shall be entitled to, reasonable compensation for all services
rendered by it in the exercise and performance of any of the powers and duties
hereunder of the Custodian, and the Master Servicer will pay or reimburse the
Custodian upon its request for all reasonable expenses, disbursements and
advances incurred or made by the Custodian 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 or to the extent that such cost or expense is
indemnified by the Depositor pursuant to the Pooling and Servicing Agreement.
(d) CUSTODIAN MAY RESIGN; TRUSTEE MAY REMOVE CUSTODIAN. The
Custodian may resign from the obligations and duties hereby imposed upon it as
such obligations and duties relate to its acting as Custodian of the Mortgage
Loans. Upon receiving such written notice of resignation, the Trustee shall
either take custody of the Mortgage Files itself and give prompt written notice
thereof to the Depositor, the Master Servicer and the Custodian, or promptly
appoint a successor Custodian by written instrument, in duplicate, one copy of
which instrument shall be delivered to the resigning Custodian and one copy to
the successor Custodian. If the Trustee shall not have taken custody of the
Mortgage Files and no successor Custodian shall have been so appointed and have
accepted appointment within 30 days after the giving of such written notice of
resignation, the resigning Custodian may petition any court of competent
jurisdiction for the appointment of a successor Custodian.
The Trustee may remove the Custodian at any time with the
consent of the Master Servicer. In such event, the Trustee shall appoint, or
petition a court of competent jurisdiction to appoint, a successor Custodian
hereunder. Any successor Custodian shall be a depository institution subject to
supervision or examination by federal or state authority, shall be able to
satisfy the other requirements contained in Section 3.6 and shall be
unaffiliated with the Servicer or the Depositor.
Any resignation or removal of the Custodian and appointment of
a successor Custodian pursuant to any of the provisions of this Section 3.4
shall become effective upon acceptance of appointment by the successor
Custodian. The Trustee shall give prompt notice to the Depositor and the Master
Servicer of the appointment of any successor Custodian. No successor Custodian
shall be appointed by the Trustee without the prior approval of the Depositor
and the Master Servicer.
(e) MERGER OR CONSOLIDATION OF CUSTODIAN. Any Person into
which the Custodian 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 Custodian shall be a party, or any Person succeeding
to the business of the Custodian, shall be the successor of the Custodian
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.
(f) REPRESENTATIONS OF THE CUSTODIAN. The Custodian hereby
represents that it is a depository institution subject to supervision or
examination by a federal or state authority, has a combined capital and surplus
of at least $15,000,000 and is qualified to do business in the jurisdictions in
which it will hold any Mortgage File.
MISCELLANEOUS PROVISIONS
(a) NOTICES. All notices, requests, consents and demands and
other communications required under this Agreement or pursuant to any other
instrument or document delivered hereunder shall be in writing and, unless
otherwise specifically provided, may be delivered personally, by telegram or
telex, or by registered or certified mail, postage prepaid, return receipt
requested, at the addresses specified on the signature page hereof (unless
changed by the particular party whose address is stated herein by similar notice
in writing).
(b) AMENDMENTS. No modification or amendment of or supplement
to this Agreement shall be valid or effective unless the same is in writing and
signed by all parties hereto, and neither the Depositor, the Master Servicer nor
the Trustee shall enter into any amendment hereof except as permitted by the
Pooling and Servicing Agreement. The Trustee shall give prompt notice to the
Custodian of any amendment or supplement to the Pooling and Servicing Agreement
and furnish the Custodian with written copies thereof.
(c) GOVERNING LAW. THIS AGREEMENT SHALL BE DEEMED A CONTRACT
MADE UNDER THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS
PRINCIPLES THEREOF OTHER THAN SECTION 5-1401 AND SHALL BE CONSTRUED AND ENFORCED
IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.
(d) RECORDATION OF AGREEMENT. To the extent permitted by
applicable law, this Agreement is subject to recordation in all appropriate
public offices for real property records in all the counties or other comparable
jurisdictions in which any or all of the properties subject to the Mortgages are
situated, and in any other appropriate public recording office or elsewhere,
such recordation to be effected by the Depositor and at the Trust's expense, but
only upon direction accompanied by an Opinion of Counsel reasonably satisfactory
to the Depositor to the effect that the failure to effect such recordation is
likely to materially and adversely affect 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.
(e) 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.
IN WITNESS WHEREOF, this Agreement is executed as of the date
first above written.
Address: U.S. BANK NATIONAL ASSOCIATION not
individually but solely as Trustee
Xxx Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxx, XX 00000
By:
------------------------------
Name:
Attention: Title
Telecopy:
Confirmation:
Address: STRUCTURED ASSET MORTGAGE
INVESTMENTS II INC.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000 By:
------------------------------
Name:
Title:
Address: XXXXX FARGO BANK,
NATIONAL ASSOCIATION, as Master
Servicer
0000 Xxx Xxxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
By:
------------------------------
Name: Xxxxxx Xxxxxx
Title: Assistant Vice President
Address: XXXXX FARGO BANK,
NATIONAL ASSOCIATION, as Custodian
0000 Xxx Xxxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000 By:
------------------------------
Name: Xxxxxx Xxxxxx
Title: Assistant Vice President
STATE OF NEW YORK )
)ss.:
COUNTY OF NEW YORK )
On the 30th day of June 2005 before me, a notary public in and
for said State, personally appeared ______________, known to me to be a(n)
_____________ of U.S. Bank National Assocation 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
[SEAL]
STATE OF MARYLAND )
) ss.:
COUNTY OF XXXXXX )
On the 30th day of June 2005 before me, a notary public in and
for said State, personally appeared Xxxxxx Xxxxxx, known to me to be an
Assistant Vice President of Xxxxx Fargo Bank, National Association, a national
banking association that executed the within instrument, and also known to me to
be the person who executed it on behalf of said national banking association,
and acknowledged to me that such national banking association executed the
within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
--------------------------------
Notary Public
[SEAL]
STATE OF NEW YORK )
)ss.:
COUNTY OF NEW YORK )
On the 30th day of June 2005 before me, a notary public in and
for said State, personally appeared Xxxxx Xxxxxxxxxxx, known to me to be a Vice
President of Structured Asset Mortgage Investments II Inc., 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 MARYLAND )
)ss.:
COUNTY OF XXXXXX )
On the 30th day of June 2005 before me, a notary public in and
for said State, personally appeared Xxxxxx Xxxxxx, known to me to be an
Assistant Vice President of Xxxxx Fargo Bank, National Association, 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 ONE
FORM OF CUSTODIAN INITIAL CERTIFICATION
June 30, 2005
U.S. Bank National Association Structured Asset Mortgage Investments II Inc.
Xxx Xxxxxxx Xxxxxx, 0xx Xxxxx 000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000 Xxx Xxxx, Xxx Xxxx 00000
Attention: Structured Asset Mortgage Investments II Inc.
Prime Mortgage Trust, Mortgage Pass-Through Certificates, Series 2005-2
Re: Custodial Agreement, dated as of June 30, 2005, by and among U.S. Bank
National Assocation, Structured Asset Mortgage Investments II Inc. and
Xxxxx Fargo Bank, National Association relating to Prime Mortgage Trust
2005-2, Mortgage Pass-Through Certificates, Series 2005-2
-----------------------------------------------------------------------
Ladies and Gentlemen:
In accordance with Section 2.3(a) of the above-captioned
Custodial Agreement, and subject to Section 2.02(a) of the Pooling and Servicing
Agreement, the undersigned, as Custodian, hereby certifies that it has received
a Mortgage File (which contains an original Mortgage Note or lost note
affidavit) to the extent required in Section 2.01 of the Pooling and Servicing
Agreement with respect to each Mortgage Loan listed in 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 Custodial Agreement.
XXXXX FARGO BANK, NATIONAL
ASSOCIATION
By:
------------------------------
Name:
Title:
EXHIBIT TWO
FORM OF CUSTODIAN INTERIM CERTIFICATION
___________, 20__
U.S. Bank National Association Structured Asset Mortgage Investments II Inc. Xxx
Xxxxxxx Xxxxxx, 0xx Xxxxx 000 Xxxxxxx Xxxxxx Xxxxxx, XX 00000 Xxx Xxxx, Xxx Xxxx
00000
Attention: Structured Asset Mortgage Investments II Inc.
Prime Mortgage Trust, Mortgage Pass-Through Certificates, Series 2005-2
Re: Custodial Agreement, dated as of June 30, 2005, by and among U.S. Bank
National Association, Structured Asset Mortgage Investments II Inc. and
Xxxxx Fargo Bank, National Association relating to Prime Mortgage Trust
2005-2, Mortgage Pass-Through Certificates, Series 2005-2
-----------------------------------------------------------------------
Ladies and Gentlemen:
In accordance with Section 2.3(b) of the above-captioned
Custodial Agreement, and subject to Section 2.02(a) of the Pooling and Servicing
Agreement, the undersigned, as Custodian, hereby certifies that it has received
a Mortgage File to the extent required pursuant to Section 2.01 of the Pooling
and Servicing Agreement with respect to each Mortgage 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 Custodial Agreement.
XXXXX FARGO BANK, NATIONAL
ASSOCIATION
By:
-------------------------------
Name:
-----------------------------
Title:
----------------------------
EXHIBIT THREE
FORM OF CUSTODIAN FINAL CERTIFICATION
_______, 20__
U.S. Bank National Association Structured Asset Mortgage Investments II Inc. Xxx
Xxxxxxx Xxxxxx, 0xx Xxxxx 000 Xxxxxxx Xxxxxx Xxxxxx, XX 00000 Xxx Xxxx, Xxx Xxxx
00000
Attention: Structured Asset Mortgage Investments II Inc.
Prime Mortgage Trust 2005-2, Mortgage Pass-Through Certificates, Series 2005-2
Re: Custodial Agreement, dated as of June 30, 2005, by and among U.S. Bank
National Association, Structured Asset Mortgage Investments II Inc. and
Xxxxx Fargo Bank, National Association relating to Prime Mortgage Trust
2005-2, Mortgage Pass-Through Certificates, Series 2005-2
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Ladies and Gentlemen:
In accordance with Section 2.3 of the above-captioned
Custodial Agreement and subject to Section 2.02(b) of the Pooling and Servicing
Agreement, the undersigned, as Custodian, hereby certifies that it has received
a Mortgage File to the extent required pursuant to Section 2.01 of the Pooling
and Servicing Agreement with respect to each Mortgage 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 in
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 Custodial Agreement
or in the Pooling and Servicing Agreement, as applicable.
XXXXX FARGO BANK, NATIONAL
ASSOCIATION
By:
------------------------------
Name:
----------------------------
Title:
---------------------------
SCHEDULE A
(Provided upon request)
EXHIBIT H-1
SERVICING AGREEMENT
CITIMORTGAGE
[provided upon request]
EXHIBIT H-2
SERVICING AGREEMENT
EMC
[provided upon request]
EXHIBIT H-3
SERVICING AGREEMENT
EVERHOME
[provided upon request]
EXHIBIT H-4
SERVICING AGREEMENT
FIFTH THIRD
[provided upon request]
EXHIBIT H-5
SERVICING AGREEMENT
GMAC
[provided upon request]
EXHIBIT H-6
SERVICING AGREEMENT
GREENPOINT
[provided upon request]
EXHIBIT H-7
SERVICING AGREEMENT
NATIONAL CITY
[provided upon request]
EXHIBIT H-8
SERVICING AGREEMENT
NAVY FEDERAL
[provided upon request]
EXHIBIT H-9
SERVICING AGREEMENT
PHH MORTGAGE
[provided upon request]
EXHIBIT H-10
SERVICING AGREEMENT
SUNTRUST
[provided upon request]
EXHIBIT H-11
SERVICING AGREEMENT
WAMU
[provided upon request]
EXHIBIT H-12
SERVICING AGREEMENT
XXXXX FARGO
[provided upon request]
EXHIBIT I
ASSIGNMENT AGREEMENTS
[provided upon request]
EXHIBIT J
FORM OF MORTGAGE LOAN PURCHASE AGREEMENT
MORTGAGE LOAN PURCHASE AGREEMENT, dated as of June 30, 2005,
as amended and supplemented by any and all amendments hereto (collectively, the
"AGREEMENT"), by and between EMC MORTGAGE CORPORATION, a Delaware corporation
(the "MORTGAGE LOAN SELLER") and STRUCTURED ASSET MORTGAGE INVESTMENTS II INC.,
a Delaware corporation (the "PURCHASER").
Upon the terms and subject to the conditions of this
Agreement, the Mortgage Loan Seller agrees to sell, and the Purchaser agrees to
purchase, certain conventional, first lien mortgage loans secured primarily by
one- to four-family residential properties, an interest in shares issued by a
cooperative apartment corporation and the related proprietary lease and
individual condominium units (collectively, the "MORTGAGE Loans") as described
herein. The Purchaser intends to deposit the Mortgage Loans into a trust fund
(the "TRUST Fund") and create Prime Mortgage Trust, Mortgage Pass-Through
Certificates, Series 2005-2 (the "CERTIFICATES"), under a pooling and servicing
agreement, to be dated as of June 1, 2005 (the "POOLING AND SERVICING
AGREEMENT"), among the Purchaser, as depositor, Xxxxx Fargo Bank, National
Association, as master servicer and securities administrator, U.S. Bank National
Association, as trustee (the "TRUSTEE") and EMC Mortgage Corporation, as seller
and company.
The Purchaser has filed with the Securities and Exchange
Commission (the "COMMISSION") a registration statement on Form S-3 (Number
333-120916) relating to its Mortgage Pass-Through Certificates and the offering
of certain series thereof (including certain classes of the Mortgage
Pass-Through Certificates) from time to time in accordance with Rule 415 under
the Securities Act of 1933, as amended, and the rules and regulations of the
Commission promulgated thereunder (the "SECURITIES ACT"). Such registration
statement, when it became effective under the Securities Act, and the prospectus
relating to the public offering of certain classes of the Mortgage Pass-Through
Certificates by the Purchaser (the "PUBLIC OFFERING"), as each may be amended or
supplemented from time to time pursuant to the Securities Act or otherwise, are
referred to herein as the "REGISTRATION STATEMENT" and the "PROSPECTUS,"
respectively. The "PROSPECTUS SUPPLEMENT" shall mean that supplement, dated June
[ ], 2005 to the Prospectus, dated December 20, 2004, relating to certain
classes of the Mortgage Pass-Through Certificates. With respect to the Public
Offering of certain classes of the Certificates, the Purchaser and Bear, Xxxxxxx
& Co. Inc. ("BEAR XXXXXXX") have entered into a terms agreement dated as of June
[ ], 2005 to an underwriting agreement dated January 25, 2005, between the
Purchaser and Bear Xxxxxxx (together, the "UNDERWRITING AGREEMENT").
Now, therefore, in consideration of the premises and the
mutual agreements set forth herein, the parties hereto agree as follows:
DEFINITIONS. Certain terms are defined herein.
Capitalized terms used herein but not defined herein shall have the meanings
specified in the Pooling and Servicing Agreement. The following other terms are
defined as follows:
ACQUISITION PRICE: Cash in an amount equal to $______ (plus
$______ in accrued interest)(2).
BEAR XXXXXXX: Bear, Xxxxxxx & Co. Inc.
CLOSING DATE: June 30, 2005.
CUT-OFF DATE: June 1, 2005.
CUT-OFF DATE BALANCE: Shall mean $243,340,462.
DELETED MORTGAGE LOAN: A Mortgage Loan replaced or to be
replaced by a Substitute Mortgage Loan.
DUE DATE: With respect to each Mortgage Loan, the date in each
month on which its scheduled payment is due if such due date is the first day of
a month and otherwise is deemed to be the first day of the following month or
such other date specified in the related Servicing Agreement.
FITCH: Fitch, Inc. or its successor in interest.
MASTER SERVICER: Xxxxx Fargo Bank, National Association.
MERS: Mortgage Electronic Registration Systems, Inc., a
corporation organized and existing under the laws of the State of Delaware, or
any successor thereto.
MERS(R) SYSTEM: The system of recording transfers of Mortgages
electronically maintained by MERS.
MORTGAGE: The mortgage or deed of trust creating a first lien
on an interest in real property securing a Mortgage Note.
MORTGAGE FILE: The items referred to in EXHIBIT 1 pertaining
to a particular Mortgage Loan and any additional documents required to be added
to such documents pursuant to this Agreement.
MORTGAGE INTEREST RATE: The annual rate of interest borne by a
Mortgage Note as stated therein.
MORTGAGOR: The obligor(s) on a Mortgage Note.
NET RATE: For each Mortgage Loan, the Mortgage Interest Rate
for such Mortgage Loan less the Servicing Fee Rate and the Lender-Paid PMI Rate
(if applicable).
OPINION OF COUNSEL: A written opinion of counsel, who may be
counsel for the Mortgage Loan Seller or the Purchaser, reasonably acceptable to
the Trustee.
--------------
(2) Please contact Bear, Xxxxxxx & Co. Inc. for Purchase Price.
PERSON: Any legal person, including any individual,
corporation, partnership, joint venture, association, joint stock company,
trust, unincorporated organization or government or any agency or political
subdivision thereof.
PURCHASE PRICE: With respect to any Mortgage Loan (or any
property acquired with respect thereto) required to be repurchased by the
Mortgage Loan Seller pursuant to this Agreement or Article II of the Pooling and
Servicing Agreement, an amount equal to the sum of (i)(a) 100% of the
Outstanding Principal Balance of such Mortgage Loan as of the date of repurchase
(or if the related Mortgaged Property was acquired with respect thereto, 100% of
the Outstanding Principal Balance at the date of the acquisition), plus (b)
accrued but unpaid interest on the Outstanding Principal Balance at the related
Mortgage Interest Rate, through and including the last day of the month of
repurchase, plus (c) any unreimbursed Monthly Advances and servicing advances
payable to the Servicer of the Mortgage Loan and (ii) any costs and damages (if
any) incurred by the Trust in connection with any violation of such Mortgage
Loan of any anti-predatory lending laws.
RATING AGENCIES: Fitch and S&P, each a "RATING AGENCY."
SECURITIES ACT: The Securities Act of 1933, as amended.
SECURITY INSTRUMENT: A written instrument creating a valid
first lien on a Mortgaged Property securing a Mortgage Note, which may be any
applicable form of mortgage, deed of trust, deed to secure debt or security
deed, including any riders or addenda thereto.
SERVICING AGREEMENTS: Shall have the meaning assigned to such
term in the Pooling and Servicing Agreement.
STANDARD & POOR'S OR S&P: Standard & Poor's, a division of The
XxXxxx-Xxxx Companies, Inc. or its successors in interest.
SUBSTITUTE MORTGAGE LOAN: A mortgage loan substituted for a
Deleted Mortgage Loan which must meet on the date of such substitution the
requirements stated herein and in the Pooling and Servicing Agreement; upon such
substitution, such mortgage loan shall be a "Mortgage Loan" hereunder.
VALUE: The value of the Mortgaged Property at the time of
origination of the related Mortgage Loan, such value being the lesser of (i) the
value of such property set forth in an appraisal accepted by the applicable
originator of the Mortgage Loan or (ii) the sales price of such property at the
time of origination.
PURCHASE AND SALE OF THE MORTGAGE LOANS AND RELATED
RIGHTS. (a) Upon satisfaction of the conditions set forth in Section 10 hereof,
the Mortgage Loan Seller agrees to sell, and the Purchaser agrees to purchase
Mortgage Loans having an aggregate outstanding principal balance as of the
Cut-off Date equal to the Cut-off Date Balance.
(b) The closing for the purchase and sale of the Mortgage
Loans and the closing for the issuance of the Mortgage Pass-Through Certificates
will take place on the Closing Date at the office of the Purchaser's counsel in
New York, New York or such other place as the parties shall agree.
(c) Upon the satisfaction of the conditions set forth in
Section 10 hereof, on the Closing Date, the Purchaser shall pay to the Mortgage
Loan Seller the Acquisition Price for the Mortgage Loans in immediately
available funds by wire transfer to such account or accounts as shall be
designated by the Mortgage Loan Seller.
(d) In addition to the foregoing, on the Closing Date the
Mortgage Loan Seller assigns to the Purchaser all of its right, title and
interest in the Servicing Agreements (other than its right to enforce the
representations and warranties set forth therein).
MORTGAGE LOAN SCHEDULES. The Mortgage Loan Seller
agrees to provide to the Purchaser as of the date hereof a preliminary listing
of the Mortgage Loans (the "PRELIMINARY MORTGAGE LOAN SCHEDULE") setting forth
the information listed on EXHIBIT 2 to this Agreement with respect to each of
the Mortgage Loans being sold by the Mortgage Loan Seller. If there are changes
to the Preliminary Mortgage Loan Schedule, the Mortgage Loan Seller shall
provide to the Purchaser as of the Closing Date a final schedule (the "FINAL
MORTGAGE LOAN SCHEDULE") setting forth the information listed on EXHIBIT 2 to
this Agreement with respect to each of the Mortgage Loans being sold by the
Mortgage Loan Seller to the Purchaser. The Final Mortgage Loan Schedule shall be
delivered to the Purchaser on the Closing Date, shall be attached to an
amendment to this Agreement to be executed on the Closing Date by the parties
hereto and shall be in form and substance mutually agreed to by the Mortgage
Loan Seller and the Purchaser (the "AMENDMENT"). If there are no changes to the
Preliminary Mortgage Loan Schedule, the Preliminary Mortgage Loan Schedule shall
be the Final Mortgage Loan Schedule for all purposes hereof.
MORTGAGE LOAN TRANSFER.
(a) The Purchaser will be entitled to all scheduled payments
of principal and interest on the Mortgage Loans due after the Cut-off Date
(regardless of when actually collected) and all payments thereon, other than
scheduled principal and interest due on or before the Cut-off Date but received
after the Cut-off Date. The Mortgage Loan Seller will be entitled to all
scheduled payments of principal and interest on the Mortgage Loans due on or
before the Cut-off Date (including payments collected after the Cut-off Date)
and all payments thereon, other than scheduled principal and interest due after
the Cut-off Date but received on or before the Cut-off Date. Such principal
amounts and any interest thereon belonging to the Mortgage Loan Seller as
described above will not be included in the aggregate outstanding principal
balance of the Mortgage Loans as of the Cut-off Date as set forth on the Final
Mortgage Loan Schedule.
(b) Pursuant to various conveyancing documents to be executed
on the Closing Date and pursuant to the Pooling and Servicing Agreement, the
Purchaser will assign on the Closing Date all of its right, title and interest
in and to the Mortgage Loans to the Trustee for the benefit of the
Certificateholders and Radian Asset Assurance Inc. In connection with the
transfer and assignment of the Mortgage Loans, the Mortgage Loan Seller has
delivered or will deliver or cause to be delivered to the Trustee by the Closing
Date or such later date as is agreed to by the Purchaser and the Mortgage Loan
Seller (each of the Closing Date and such later date is referred to as a
"MORTGAGE FILE DELIVERY DATE"), the items of each Mortgage File, PROVIDED,
HOWEVER, that in lieu of the foregoing, the Mortgage Loan Seller may deliver the
following documents, under the circumstances set forth below: (w) in lieu of the
original Security Instrument, assignments to the Trustee or intervening
assignments thereof which have been delivered, are being delivered or will, upon
receipt of recording information relating to the Security Instrument required to
be included thereon, be delivered to recording offices for recording and have
not been returned to the Mortgage Loan Seller in time to permit their delivery
as specified above, the Mortgage Loan Seller may deliver a true copy thereof
with a certification by the Mortgage Loan Seller, on the face of such copy,
substantially as follows: "Certified to be a true and correct copy of the
original, which has been transmitted for recording"; (x) in lieu of the Security
Instrument, assignments to the Trustee or intervening assignments thereof, if
the applicable jurisdiction retains the originals of such documents (as
evidenced by a certification from the Mortgage Loan Seller to such effect) the
Mortgage Loan Seller may deliver photocopies of such documents containing an
original certification by the judicial or other governmental authority of the
jurisdiction where such documents were recorded; (y) in lieu of the Mortgage
Notes relating to the Mortgage Loans, each identified in the list delivered by
the Purchaser to the Trustee on the Closing Date and attached hereto as Exhibit
5, the Mortgage Loan Seller may deliver lost note affidavits and indemnities of
the Mortgage Loan Seller; and (z) the Mortgage Loan Seller shall not be required
to deliver intervening assignments or Mortgage Note endorsements between the
related Underlying Seller and the Mortgage Loan Seller, between the Mortgage
Loan Seller and the Depositor, and between the Depositor and the Trustee; and
provided further, however, that in the case of Mortgage Loans which have been
prepaid in full after the Cut-off Date and prior to the Closing Date, the
Mortgage Loan Seller, in lieu of delivering the above documents, may deliver to
the Trustee a certification by the Mortgage Loan Seller or the Master Servicer
to such effect and shall deposit all amounts paid in respect of such Mortgage
Loans in the Master Servicer Collection Account on the Closing Date. The
Mortgage Loan Seller shall deliver such original documents (including any
original documents as to which certified copies had previously been delivered)
or such certified copies to the Trustee promptly after they are received. The
Mortgage Loan Seller shall cause the Mortgage and intervening assignments, if
any, and the assignment of the Security Instrument to be recorded not later than
180 days after the Closing Date, unless such assignment is not required to be
recorded under the terms set forth in Section 6(a) hereof.
(c) In connection with the assignment of any Mortgage Loan
registered on the MERS(R) System, the Mortgage Loan Seller further agrees that
it will cause, at the Mortgage Loan Seller's own expense, within 30 days after
the Closing Date, the MERS(R) System to indicate that such Mortgage Loans have
been assigned by the Mortgage Loan Seller to the Purchaser and by the Purchaser
to the Trustee in accordance with this Agreement for the benefit of the
Certificateholders by including (or deleting, in the case of Mortgage Loans
which are repurchased in accordance with this Agreement) in such computer files
(a) the code in the field which identifies the specific Trustee and (b) the code
in the field "Pool Field" which identifies the series of the Mortgage
Pass-Through Certificates issued in connection with such Mortgage Loans. The
Mortgage Loan Seller further agrees that it will not, and will not permit any
Servicer or the Master Servicer to, and the Master Servicer agrees that it will
not, alter the codes referenced in this paragraph with respect to any Mortgage
Loan during the term of the Pooling and Servicing Agreement unless and until
such Mortgage Loan is repurchased in accordance with the terms of the Pooling
and Servicing Agreement.
(d) The Mortgage Loan Seller and the Purchaser acknowledge
hereunder that all of the Mortgage Loans and the related servicing will
ultimately be assigned to U.S. Bank National Association, as Trustee for the
Holders of the Mortgage, on the date hereof.
EXAMINATION OF MORTGAGE FILES.
(a) On or before the Mortgage File Delivery Date, the Mortgage
Loan Seller will have made the Mortgage Files available to the Purchaser or its
agent for examination which may be at the offices of the Trustee or the Mortgage
Loan Seller and/or the Mortgage Loan Seller's custodian. The fact that the
Purchaser or its agent has conducted or has failed to conduct any partial or
complete examination of the Mortgage Files shall not affect the Purchaser's
rights to demand cure, repurchase, substitution or other relief as provided in
this Agreement. In furtherance of the foregoing, the Mortgage Loan Seller shall
make the Mortgage Files available to the Purchaser or its agent from time to
time so as to permit the Purchaser to confirm the Mortgage Loan Seller's
compliance with the delivery and recordation requirements of this Agreement and
the Pooling and Servicing Agreement. In addition, upon request of the Purchaser,
the Mortgage Loan Seller agrees to provide to the Purchaser, Bear Xxxxxxx and to
any investors or prospective investors in the Mortgage Pass-Through Certificates
information regarding the Mortgage Loans and their servicing, to make the
Mortgage Files available to the Purchaser, Bear Xxxxxxx and to such investors or
prospective investors (which may be at the offices of the Mortgage Loan Seller
and/or the Mortgage Loan Seller's custodian) and to make available personnel
knowledgeable about the Mortgage Loans for discussions with the Purchaser, Bear
Xxxxxxx and such investors or prospective investors, upon reasonable request
during regular business hours, sufficient to permit the Purchaser, Bear Xxxxxxx
and such investors or potential investors to conduct such due diligence as any
such party reasonably believes is appropriate.
(b) Pursuant to the Pooling and Servicing Agreement, on the
Closing Date the Custodian, on behalf of the Trustee, for the benefit of the
Pass-Through Certificates and Radian Asset Assurance Inc., will acknowledge
receipt of each Mortgage Loan by delivery to the Mortgage Loan Seller, the
Purchaser and the Trustee of an initial certification in the form attached as
Exhibit One to the Custodial Agreement.
(c) Pursuant to the Pooling and Servicing Agreement, within 90
days of the Closing Date (or, with respect to any Substitute Mortgage Loan,
within five Business Days after the receipt by the Trustee or Custodian
thereof), the Trustee will review or shall cause the Custodian to review items
of the Mortgage Files as set forth on EXHIBIT 1 and will deliver to the Mortgage
Loan Seller, the Purchaser and the Trustee an interim certification
substantially in the form of Exhibit Two to the Custodial Agreement. If the
Trustee or Custodian, as its agent, finds any document listed on EXHIBIT 1 not
to have been executed or received, or to be unrelated, determined on the basis
of the Mortgagor name, original principal balance and loan number, to the
Mortgage Loans identified in the Final Mortgage Loan Schedule or to appear
defective on its face (a "MATERIAL DEFECT"), the Trustee or the Custodian, as
its agent, shall promptly notify the Mortgage Loan Seller of such Material
Defect. The Mortgage Loan Seller shall correct or cure any such Material Defect
within 90 days from the date of notice from the Trustee or the Custodian, as its
agent, of the Material Defect and if the Mortgage Loan Seller fails to correct
or cure such Material Defect within such period and such defect materially and
adversely affects the interests of the Certificateholders in the related
Mortgage Loan, the Mortgage Loan Seller will, in accordance with the terms of
the Pooling and Servicing Agreement, within 90 days of the date of notice,
provide the Trustee with a Substitute Mortgage Loan (if within two years of the
Closing Date) or purchase the related Mortgage Loan at the applicable Purchase
Price; PROVIDED THAT, if such defect would cause the Mortgage Loan to be other
than a "qualified mortgage" as defined in Section 860G(a)(3) of the Code, any
such cure, repurchase or substitution must occur within 90 days from the date
such breach was discovered; PROVIDED, HOWEVER, that if such defect relates
solely to the inability of the Mortgage Loan Seller to deliver the original
Security Instrument or intervening assignments thereof, or a certified copy
because the originals of such documents, or a certified copy, have not been
returned by the applicable jurisdiction, the Mortgage Loan Seller shall not be
required to purchase such Mortgage Loan if the Mortgage Loan Seller delivers
such original documents or certified copy promptly upon receipt, but in no event
later than 360 days after the Closing Date. The foregoing repurchase obligation
shall not apply in the event that the Mortgage Loan Seller cannot deliver such
original or copy of any document submitted for recording to the appropriate
recording office in the applicable jurisdiction because such document has not
been returned by such office; provided that the Mortgage Loan Seller shall
instead deliver a recording receipt of such recording office or, if such receipt
is not available, a certificate confirming that such documents have been
accepted for recording, and delivery to the Trustee or the Custodian, as its
agent, shall be effected by the Mortgage Loan Seller within thirty days of its
receipt of the original recorded document.
(d) Pursuant to the Pooling and Servicing Agreement, within
180 days of the Closing Date (or, with respect to any Substitute Mortgage Loan,
within five Business Days after the receipt by the Trustee or Custodian thereof)
the Trustee will review or cause the Custodian to review items of the Mortgage
Files as set forth on EXHIBIT 1 and will deliver to the Mortgage Loan Seller,
the Purchaser and the Trustee a final certification substantially in the form of
Exhibit Three to the Custodial Agreement. If the Trustee or Custodian, as its
agent, finds a Material Defect, the Trustee or the Custodian, as its agent,
shall promptly notify the Mortgage Loan Seller of such Material Defect. The
Mortgage Loan Seller shall correct or cure any such Material Defect within 90
days from the date of notice from the Trustee or the Custodian, as its agent, of
the Material Defect and if the Mortgage Loan Seller fails to correct or cure
such Material Defect within such period and such defect materially and adversely
affects the interests of the Certificateholders in the related Mortgage Loan,
the Mortgage Loan Seller will, in accordance with the terms of the Pooling and
Servicing Agreement, within 90 days of the date of notice, provide the Trustee
with a Substitute Mortgage Loan (if within two years of the Closing Date) or
purchase the related Mortgage Loan at the applicable Purchase Price; PROVIDED
THAT, if such defect would cause the Mortgage Loan to be other than a "qualified
mortgage" as defined in Section 860G(a)(3) of the Code, any such cure,
repurchase or substitution must occur within 90 days from the date such breach
was discovered; PROVIDED, HOWEVER, that if such defect relates solely to the
inability of the Mortgage Loan Seller to deliver the original Security
Instrument or intervening assignments thereof, or a certified copy because the
originals of such documents, or a certified copy, have not been returned by the
applicable jurisdiction, the Mortgage Loan Seller shall not be required to
purchase such Mortgage Loan if the Mortgage Loan Seller delivers such original
documents or certified copy promptly upon receipt, but in no event later than
360 days after the Closing Date. The foregoing repurchase obligation shall not
apply in the event that the Mortgage Loan Seller cannot deliver such original or
copy of any document submitted for recording to the appropriate recording office
in the applicable jurisdiction because such document has not been returned by
such office; provided that the Mortgage Loan Seller shall instead deliver a
recording receipt of such recording office or, if such receipt is not available,
a certificate confirming that such documents have been accepted for recording,
and delivery to the Trustee or the Custodian, as its agent, shall be effected by
the Mortgage Loan Seller within thirty days of its receipt of the original
recorded document.
(e) At the time of any substitution, the Mortgage Loan Seller
shall deliver or cause to be delivered the Substitute Mortgage Loan, the related
Mortgage File and any other documents and payments required to be delivered in
connection with a substitution pursuant to the Pooling and Servicing Agreement.
At the time of any purchase or substitution, the Trustee in accordance with the
terms of the Pooling and Servicing Agreement shall (i) assign to the Mortgage
Loan Seller and cause the Custodian to release the documents (including, but not
limited to, the Mortgage, Mortgage Note and other contents of the Mortgage File)
in the possession of the Custodian relating to the Deleted Mortgage Loan and
(ii) execute and deliver such instruments of transfer or assignment, in each
case without recourse, as shall be necessary to vest in the Mortgage Loan Seller
title to such Deleted Mortgage Loan.
RECORDATION OF ASSIGNMENTS OF MORTGAGE.
(a) The Mortgage Loan Seller shall cause each assignment of
the Security Instrument from the Mortgage Loan Seller to the Trustee to be
recorded not later than 180 days after the Closing Date, unless (a) such
recordation is not required by the Rating Agencies or an Opinion of Counsel has
been provided to the Trustee (with a copy to the Custodian) which states that
the recordation of such assignments is not necessary to protect the interests of
the Certificateholders in the related Mortgage Loans or (b) MERS is identified
on the Mortgage or a properly recorded assignment of the Mortgage, as the
Mortgagee of record solely as nominee for the Mortgage Loan Seller and its
successors and assigns; PROVIDED, HOWEVER, notwithstanding the foregoing, each
assignment shall be submitted for recording by the Mortgage Loan Seller in the
manner described above, at no expense to the Trust or Trustee, upon the earliest
to occur of (i) reasonable direction by the Holders of Mortgage Pass-Through
Certificates evidencing Fractional Undivided Interests aggregating not less than
25% of the portion of the Trust related to such Classes, (ii) the occurrence of
an Event of Default, (iii) the occurrence of a bankruptcy, insolvency or
foreclosure relating to the Mortgage Loan Seller and (iv) the occurrence of a
servicing transfer as described in Section 8.02 of the Pooling and Servicing
Agreement.
While each such Mortgage or assignment is being recorded, if
necessary, the Mortgage Loan Seller shall leave or cause to be left with the
Trustee a certified copy of such Mortgage or assignment. All customary recording
fees and reasonable expenses relating to the recordation of the assignments of
mortgage to the Trustee or the Opinion of Counsel, as the case may be, shall be
borne by the Mortgage Loan Seller.
(b) It is the express intent of the parties hereto that the
conveyance of the Mortgage Loans by the Mortgage Loan Seller to the Purchaser,
as contemplated by this Agreement be, and be treated as, a sale. It is, further,
not the intention of the parties that such conveyance be deemed a pledge of the
Mortgage Loans by the Mortgage Loan Seller to the Purchaser to secure a debt or
other obligation of the Mortgage Loan Seller. However, in the event that,
notwithstanding the intent of the parties, the Mortgage Loans are held by a
court to continue to be property of the Mortgage Loan Seller, then (a) this
Agreement shall also be deemed to be a security agreement within the meaning of
Articles 8 and 9 of the applicable Uniform Commercial Code; (b) the transfer of
the Mortgage Loans provided for herein shall be deemed to be a grant by the
Mortgage Loan Seller to the Purchaser of a security interest in all of the
Mortgage Loan Seller's right, title and interest in and to the Mortgage Loans
and all amounts payable to the holders of the Mortgage 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, to the
extent the Purchaser would otherwise be entitled to own such Mortgage Loans and
proceeds pursuant to Section 4 hereof, including all amounts, other than
investment earnings, from time to time held or invested in any accounts created
pursuant to the Pooling and Servicing Agreement, whether in the form of cash,
instruments, securities or other property; (c) the possession by the Purchaser
or the Trustee of Mortgage Notes and such other items of property as constitute
instruments, money, negotiable documents or chattel paper shall be deemed to be
"possession by the secured party" for purposes of perfecting the security
interest pursuant to Section 9-313 (or comparable provision) of the applicable
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 Purchaser for the purpose of perfecting such security interest under
applicable law. Any assignment of the interest of the Purchaser pursuant to any
provision hereof or pursuant to the Pooling and Servicing Agreement shall also
be deemed to be an assignment of any security interest created hereby. The
Mortgage Loan Seller and the Purchaser shall, to the extent consistent with this
Agreement, take such actions as may be reasonably necessary to ensure that, if
this Agreement were deemed to create a security interest in the Mortgage 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 the Pooling and Servicing Agreement.
REPRESENTATIONS AND WARRANTIES OF MORTGAGE LOAN SELLER
CONCERNING THE MORTGAGE LOANS. The Mortgage Loan Seller hereby represents and
warrants to the Purchaser as of the Closing Date or such other date as may be
specified below with respect to each Mortgage Loan being sold by it:
(i) the information set forth in the Mortgage Loan Schedule
attached hereto is true and correct in all material respects and the
information provided to the Rating Agencies, including the Mortgage
Loan level detail, is true and correct according to the Rating Agency
requirements;
(ii) immediately prior to the transfer to the Purchaser, the
Mortgage Loan Seller was the sole owner of beneficial title and holder
of each Mortgage and Mortgage Note relating to the Mortgage Loans and
is conveying the same free and clear of any and all liens, claims,
encumbrances, participation interests, equities, pledges, charges or
security interests of any nature and the Mortgage Loan Seller has full
right and authority to sell or assign the same pursuant to this
Agreement;
(iii) Each Mortgage Loan at the time it was made complied in
all material respects with all applicable laws and regulations,
including, without limitation, usury, equal credit opportunity,
disclosure and recording laws and all anti-predatory lending laws; and
each Mortgage Loan has been serviced in all material respects in
accordance with all applicable laws and regulations, including, without
limitation, usury, equal credit opportunity, disclosure and recording
laws and all anti-predatory lending laws and the terms of the related
Mortgage Note, the Mortgage and other loan documents;
(iv) there is no monetary default existing under any Mortgage
or the related Mortgage Note and there is no material event which, with
the passage of time or with notice and the expiration of any grace or
cure period, would constitute a default, breach or event of
acceleration; and neither the Mortgage Loan Seller, any of its
affiliates nor any servicer of any related Mortgage Loan has taken any
action to waive any default, breach or event of acceleration; no
foreclosure action is threatened or has been commenced with respect to
the Mortgage Loan;
(v) the terms of the Mortgage Note and the Mortgage have not
been impaired, waived, altered or modified in any respect, except by
written instruments, (i) if required by law in the jurisdiction where
the Mortgaged Property is located, or (ii) to protect the interests of
the Trustee on behalf of the Certificateholders;
(vi) no selection procedure reasonably believed by the
Mortgage Loan Seller to be adverse to the interests of the
Certificateholders was utilized in selecting the Mortgage Loans;
(vii) each Mortgage is a valid and enforceable first lien on
the property securing the related Mortgage Note and each Mortgaged
Property is owned by the Mortgagor in fee simple (except with respect
to common areas in the case of condominiums, PUDs and DE MINIMIS PUDs)
or by leasehold for a term longer than the term of the related
Mortgage, subject only to (i) the lien of current real property taxes
and assessments, (ii) covenants, conditions and restrictions, rights of
way, easements and other matters of public record as of the date of
recording of such Mortgage, such exceptions being acceptable to
mortgage lending institutions generally or specifically reflected in
the appraisal obtained in connection with the origination of the
related Mortgage Loan or referred to in the lender's title insurance
policy delivered to the originator of the related Mortgage Loan and
(iii) other matters to which like properties are commonly subject which
do not materially interfere with the benefits of the security intended
to be provided by such Mortgage;
(viii) there is no mechanics' lien or claim for work, labor or
material affecting the premises subject to any Mortgage which is or may
be a lien prior to, or equal with, the lien of such Mortgage except
those which are insured against by the title insurance policy referred
to in (xiii) below;
(ix) as of the Cut-off Date, there was no delinquent tax or
assessment lien against the property subject to any Mortgage, except
where such lien was being contested in good faith and a stay had been
granted against levying on the property;
(x) there is no valid offset, defense or counterclaim to any
Mortgage Note or Mortgage, including the obligation of the Mortgagor to
pay the unpaid principal and interest on such Mortgage Note;
(xi) the Mortgaged Property is undamaged by waste, fire,
earthquake or earth movement, windstorm, flood, tornado or other
casualty so as to affect adversely the value of the Mortgaged Property
as security for the Mortgage Loans or the use for which the premises
were intended; and there is no proceeding pending or threatened for the
total or partial condemnation of the related Mortgaged Property;
(xii) the Mortgaged Property and all improvements thereon
comply with all requirements of any applicable zoning and subdivision
laws and ordinances;
(xiii) a lender's title insurance policy (on an ALTA or CLTA
form) or binder, or other assurance of title customary in the relevant
jurisdiction therefor in a form acceptable to Xxxxxx Xxx or Xxxxxxx
Mac, was issued on the date that each Mortgage Loan was created by a
title insurance company which was qualified to do business in the
jurisdiction where the related Mortgaged Property is located, insuring
the Mortgage Loan Seller and its successors and assigns that the
Mortgage is a first priority lien on the related Mortgaged Property in
the original principal amount of the Mortgage Loan. The Mortgage Loan
Seller is the sole insured under such lender's title insurance policy,
and such policy, binder or assurance is valid and remains in full force
and effect, and each such policy, binder or assurance shall contain all
applicable endorsements including a negative amortization endorsement,
if applicable;
(xiv) as of the Closing Date, the improvements on each
Mortgaged Property securing a Mortgage Loan is insured (by an insurer
which is acceptable to the Mortgage Loan Seller) against loss by fire
and such hazards as are covered under a standard extended coverage
endorsement in the locale in which the Mortgaged Property is located,
in an amount which is not less than the lesser of the maximum insurable
value of the improvements securing such Mortgage Loan or the
outstanding principal balance of the Mortgage Loan, but in no event in
an amount less than an amount that is required to prevent the Mortgagor
from being deemed to be a co-insurer thereunder; if the improvement on
the Mortgaged Property is a condominium unit, it is included under the
coverage afforded by a blanket policy for the condominium project; if
upon origination of the related Mortgage Loan, the improvements on the
Mortgaged Property were in an area identified as a federally designated
flood area, a flood insurance policy is in effect in an amount
representing coverage not less than the least of (i) the outstanding
principal balance of the Mortgage Loan, (ii) the restorable cost of
improvements located on such Mortgaged Property or (iii) the maximum
coverage available under federal law; and each Mortgage obligates the
Mortgagor thereunder to maintain the insurance referred to above at the
Mortgagor's cost and expense;
(xv) each Mortgage Loan constitutes a "qualified mortgage"
under Section 860G(a)(3)(A) of the Code and Treasury Regulation Section
1.860G-2(a)(1);
(xvi) each Mortgage Loan was originated or funded by (a) 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 originated by (i) a
subsidiary of any of the foregoing institutions which subsidiary is
actually supervised and examined by applicable regulatory authorities
or (ii) a mortgage loan correspondent of any of the foregoing and that
was originated pursuant to the criteria established by any of the
foregoing) or (b) a mortgagee approved by the Secretary of Housing and
Urban Development pursuant to sections 203 and 211 of the National
Housing Act, as amended;
(xvii) none of the Mortgage Loans are (a) loans subject to 12
CFR Part 226.31, 12 CFR Part 226.32 or 12 CFR Part 226.34 of Regulation
Z, the regulation implementing TILA, which implements the Home
Ownership and Equity Protection Act of 1994, as amended or (b)
classified and/or defined as a "high cost home loan" under any federal,
state or local law, including, but not limited to, the States of
Georgia or North Carolina;
(xviii) no loan is a High-Cost Home Loan under the New Jersey
Home Ownership Security Act of 2002;
(xix) no loan in the transaction originated in New Mexico is a
High-Cost Home Loan under the New Mexico Home Loan Protection Act;
(xx) the information set forth in Schedule A of the Prospectus
Supplement with respect to the Mortgage Loans is true and correct in
all material respects;
(xxi) no Mortgage Loan is a High Cost Loan or Covered Loan, as
applicable (as such terms are defined in Standard & Poor's LEVELS(R)
Glossary, Version 5.6 Revised, Appendix E, attached hereto as Exhibit
6) and no Mortgage Loan originated on or after October 1, 2002 through
March 6, 2003 is governed by the "Georgia Fair Lending Act";
(xxii) each Mortgage Loan was originated in accordance with
the underwriting guidelines of the related originator;
(xxiii) each original Mortgage has been recorded or is in the
process of being recorded in accordance with the requirements of
Section 2.01 of the Pooling and Servicing Agreement in the appropriate
jurisdictions wherein such recordation is required to perfect the lien
thereof for the benefit of the Trust Fund;
(xxiv) the related Mortgage File contains each of the
documents and instruments listed in Section 2.01 of the Pooling and
Servicing Agreement, subject to any exceptions, substitutions and
qualifications as are set forth in such Section;
(xxv) the Mortgage Loans are currently being serviced in
accordance with accepted servicing practices; and
(xxvi) at the time of origination, each Mortgaged Property was
the subject of an appraisal which conformed to the underwriting
requirements of the originator of the Mortgage Loan, and the appraisal
is in a form which was acceptable to Xxxxxx Mae or FHLMC at the time of
origination.
It is understood and agreed that the representations and
warranties set forth in this Section 7 will inure to the benefit of the
Purchaser, its successors and assigns, notwithstanding any restrictive or
qualified endorsement on any Mortgage Note or assignment of Mortgage or the
examination of any Mortgage File. Upon any substitution for a Mortgage Loan, the
representations and warranties set forth above shall be deemed to be made by the
Mortgage Loan Seller as to any Substitute Mortgage Loan as of the date of
substitution.
Upon discovery or receipt of notice by the Mortgage Loan
Seller, the Purchaser or the Trustee of a breach of any representation or
warranty of the Mortgage Loan Seller set forth in this Section 7 which
materially and adversely affects the value of the interests of the Purchaser,
the Certificateholders or the Trustee in any of the Mortgage Loans delivered to
the Purchaser pursuant to this Agreement, the party discovering or receiving
notice of such breach shall give prompt written notice to the others. In the
case of any such breach of a representation or warranty set forth in this
Section 7, within 90 days from the date of discovery by the Mortgage Loan
Seller, or the date the Mortgage Loan Seller is notified by the party
discovering or receiving notice of such breach (whichever occurs earlier), the
Mortgage Loan Seller will (i) cure such breach in all material respects, (ii)
purchase the affected Mortgage Loan at the applicable Purchase Price or (iii) if
within two years of the Closing Date, substitute a qualifying Substitute
Mortgage Loan in exchange for such Mortgage Loan. The obligations of the
Mortgage Loan Seller to cure, purchase or substitute a qualifying Substitute
Mortgage Loan shall constitute the Purchaser's, the Trustee's and the
Certificateholder's sole and exclusive remedy under this Agreement or otherwise
respecting a breach of representations or warranties hereunder with respect to
the Mortgage Loans, except for the obligation of the Mortgage Loan Seller to
indemnify the Purchaser for such breach as set forth in and limited by Section
13 hereof.
Any cause of action against the Mortgage Loan Seller or
relating to or arising out of a breach by the Mortgage Loan Seller of any
representations and warranties made in this Section 7 shall accrue as to any
Mortgage Loan upon (i) discovery of such breach by the Mortgage Loan Seller or
notice thereof by the party discovering such breach and (ii) failure by the
Mortgage Loan Seller to cure such breach, purchase such Mortgage Loan or
substitute a qualifying Substitute Mortgage Loan pursuant to the terms hereof.
REPRESENTATIONS AND WARRANTIES CONCERNING THE MORTGAGE
LOAN SELLER. As of the date hereof and as of the Closing Date, the Mortgage Loan
Seller represents and warrants to the Purchaser as to itself in the capacity
indicated as follows:
(a) the Mortgage Loan Seller (i) is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware and (ii) is qualified and in good standing to do business in each
jurisdiction where such qualification is necessary, except where the failure so
to qualify would not reasonably be expected to have a material adverse effect on
the Mortgage Loan Seller's business as presently conducted or on the Mortgage
Loan Sellers ability to enter into this Agreement and to consummate the
transactions contemplated hereby;
(b) the Mortgage Loan Seller has full power to own its
property, to carry on its business as presently conducted and to enter into and
perform its obligations under this Agreement;
(c) the execution and delivery by the Mortgage Loan Seller of
this Agreement have been duly authorized by all necessary action on the part of
the Mortgage Loan Seller; and neither the execution and delivery of this
Agreement, nor the consummation of the transactions herein contemplated, nor
compliance with the provisions hereof, will conflict with or result in a breach
of, or constitute a default under, any of the provisions of any law,
governmental rule, regulation, judgment, decree or order binding on the Mortgage
Loan Seller or its properties or the charter or by-laws of the Mortgage Loan
Seller, except those conflicts, breaches or defaults which would not reasonably
be expected to have a material adverse effect on the Mortgage Loan Seller's
ability to enter into this Agreement and to consummate the transactions
contemplated hereby;
(d) the execution, delivery and performance by the Mortgage
Loan Seller of this Agreement and the consummation of the transactions
contemplated hereby do not require the consent or approval of, the giving of
notice to, the registration with, or the taking of any other action in respect
of, any state, federal or other governmental authority or agency, except those
consents, approvals, notices, registrations or other actions as have already
been obtained, given or made and, in connection with the recordation of the
Mortgages, powers of attorney or assignments of Mortgages not yet completed;
(e) this Agreement has been duly executed and delivered by the
Mortgage Loan Seller and, assuming due authorization, execution and delivery by
the Purchaser, constitutes a valid and binding obligation of the Mortgage Loan
Seller enforceable against it in accordance with its terms (subject to
applicable bankruptcy and insolvency laws and other similar laws affecting the
enforcement of the rights of creditors generally);
(f) there are no actions, suits or proceedings pending or, to
the knowledge of the Mortgage Loan Seller, threatened against the Mortgage Loan
Seller, before or by any court, administrative agency, arbitrator or
governmental body (i) with respect to any of the transactions contemplated by
this Agreement or (ii) with respect to any other matter which in the judgment of
the Mortgage Loan Seller will be determined adversely to the Mortgage Loan
Seller and will if determined adversely to the Mortgage Loan Seller materially
and adversely affect the Mortgage Loan Seller's ability to perform its
obligations under this Agreement; and the Mortgage Loan Seller is not in default
with respect to any order of any court, administrative agency, arbitrator or
governmental body so as to materially and adversely affect the transactions
contemplated by this Agreement; and
(g) the Mortgage Loan Seller's Information (as defined in
Section 13(a) hereof) does not include any untrue statement of a material fact
or omit to state a material fact necessary in order to make the statements made,
in light of the circumstances under which they were made, not misleading.
REPRESENTATIONS AND WARRANTIES CONCERNING THE
PURCHASER. As of the date hereof and as of the Closing Date, the Purchaser
represents and warrants to the Mortgage Loan Seller as follows:
(a) the Purchaser (i) is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware and (ii)
is qualified and in good standing as a foreign corporation to do business in
each jurisdiction where such qualification is necessary, except where the
failure so to qualify would not reasonably be expected to have a material
adverse effect on the Purchaser's business as presently conducted or on the
Purchaser's ability to enter into this Agreement and to consummate the
transactions contemplated hereby;
(b) the Purchaser has full corporate power to own its
property, to carry on its business as presently conducted and to enter into and
perform its obligations under this Agreement;
(c) the execution and delivery by the Purchaser of this
Agreement have been duly authorized by all necessary corporate action on the
part of the Purchaser; and neither the execution and delivery of this Agreement,
nor the consummation of the transactions herein contemplated, nor compliance
with the provisions hereof, will conflict with or result in a breach of, or
constitute a default under, any of the provisions of any law, governmental rule,
regulation, judgment, decree or order binding on the Purchaser or its properties
or the articles of incorporation or by-laws of the Purchaser, except those
conflicts, breaches or defaults which would not reasonably be expected to have a
material adverse effect on the Purchaser's ability to enter into this Agreement
and to consummate the transactions contemplated hereby;
(d) the execution, delivery and performance by the Purchaser
of this Agreement and the consummation of the transactions contemplated hereby
do not require the consent or approval of, the giving of notice to, the
registration with, or the taking of any other action in respect of, any state,
federal or other governmental authority or agency, except those consents,
approvals, notices, registrations or other actions as have already been
obtained, given or made;
(e) this Agreement has been duly executed and delivered by the
Purchaser and, assuming due authorization, execution and delivery by the
Mortgage Loan Seller, constitutes a valid and binding obligation of the
Purchaser enforceable against it in accordance with its terms (subject to
applicable bankruptcy and insolvency laws and other similar laws affecting the
enforcement of the rights of creditors generally);
(f) there are no actions, suits or proceedings pending or, to
the knowledge of the Purchaser, threatened against the Purchaser, before or by
any court, administrative agency, arbitrator or governmental body (i) with
respect to any of the transactions contemplated by this Agreement or (ii) with
respect to any other matter which in the judgment of the Purchaser will be
determined adversely to the Purchaser and will if determined adversely to the
Purchaser materially and adversely affect the Purchaser's ability to perform its
obligations under this Agreement; and the Purchaser is not in default with
respect to any order of any court, administrative agency, arbitrator or
governmental body so as to materially and adversely affect the transactions
contemplated by this Agreement; and
(g) the Purchaser's Information (as defined in Section 13(b)
hereof) does not include any untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements made, in light
of the circumstances under which they were made, not misleading.
CONDITIONS TO CLOSING.
(a) The obligations of the Purchaser under this Agreement will
be subject to the satisfaction, on or prior to the Closing Date, of the
following conditions:
(i) Each of the obligations of the Mortgage Loan Seller
required to be performed at or prior to the Closing Date pursuant to
the terms of this Agreement shall have been duly performed and complied
with in all material respects; all of the representations and
warranties of the Mortgage Loan Seller under this Agreement shall be
true and correct as of the date or dates specified in all material
respects; and no event shall have occurred which, with notice or the
passage of time, would constitute a default under this Agreement, or
the Pooling and Servicing Agreement; and the Purchaser shall have
received certificates to that effect signed by authorized officers of
the Mortgage Loan Seller.
(ii) The Purchaser shall have received all of the following
closing documents, in such forms as are agreed upon and reasonably
acceptable to the Purchaser, duly executed by all signatories (other
than the Purchaser) as required pursuant to the respective terms
thereof:
(1) If required pursuant to Section 3 hereof, the
Amendment dated as of the Closing Date and any documents
referred to therein;
(2) If required pursuant to Section 3 hereof, the
Final Mortgage Loan Schedule containing the information set
forth on Exhibit 2 hereto, one copy to be attached to each
counterpart of the Amendment;
(3) The Pooling and Servicing Agreement, in form and
substance reasonably satisfactory to the Trustee and the
Purchaser, and all documents required thereby duly executed by
all signatories;
(4) A certificate of an officer of the Mortgage Loan
Seller dated as of the Closing Date, in a form reasonably
acceptable to the Purchaser, and attached thereto the
resolutions of the Mortgage Loan Seller authorizing the
transactions contemplated by this Agreement, together with
copies of the charter and by-laws of the Mortgage Loan Seller;
(5) One or more opinions of counsel from the Mortgage
Loan Seller's counsel otherwise in form and substance
reasonably satisfactory to the Purchaser, the Trustee and each
Rating Agency;
(6) A letter from each of the Rating Agencies giving
each Class of Certificates set forth on Schedule A the rating
set forth on Schedule A; and
(7) Such other documents, certificates (including
additional representations and warranties) and opinions as may
be reasonably necessary to secure the intended ratings from
each Rating Agency for the Certificates.
(iii) The Certificates to be sold to Bear Xxxxxxx pursuant to
the Underwriting Agreement and the Purchase Agreement shall have been
issued and sold to Bear Xxxxxxx.
(iv) The Mortgage Loan Seller shall have furnished to the
Purchaser such other certificates of its officers or others and such
other documents and opinions of counsel to evidence fulfillment of the
conditions set forth in this Agreement and the transactions
contemplated hereby as the Purchaser and its counsel may reasonably
request.
(b) The obligations of the Mortgage Loan Seller under this
Agreement shall be subject to the satisfaction, on or prior to the Closing Date,
of the following conditions:
(i) The obligations of the Purchaser required to be performed
by it on or prior to the Closing Date pursuant to the terms of this
Agreement shall have been duly performed and complied with in all
material respects, and all of the representations and warranties of the
Purchaser under this Agreement shall be true and correct in all
material respects as of the date hereof and as of the Closing Date, and
no event shall have occurred which would constitute a breach by it of
the terms of this Agreement, and the Mortgage Loan Seller shall have
received a certificate to that effect signed by an authorized officer
of the Purchaser.
(ii) The Mortgage Loan Seller shall have received copies of
all of the following closing documents, in such forms as are agreed
upon and reasonably acceptable to the Mortgage Loan Seller, duly
executed by all signatories other than the Mortgage Loan Seller as
required pursuant to the respective terms thereof:
(1) If required pursuant to Section 3 hereof, the
Amendment dated as of the Closing Date and any documents
referred to therein;
(2) The Pooling and Servicing Agreement, in form and
substance reasonably satisfactory to the Mortgage Loan Seller,
and all documents required thereby duly executed by all
signatories;
(3) A certificate of an officer of the Purchaser
dated as of the Closing Date, in a form reasonably acceptable
to the Mortgage Loan Seller, and attached thereto the
resolutions of the Purchaser authorizing the transactions
contemplated by this Agreement and the Pooling and Servicing
Agreement, together with copies of the Purchaser's articles of
incorporation, and evidence as to the good standing of the
Purchaser dated as of a recent date;
(4) One or more opinions of counsel from the
Purchaser's counsel in form and substance reasonably
satisfactory to the Mortgage Loan Seller;
(5) Such other documents, certificates (including
additional representations and warranties) and opinions as may
be reasonably necessary to secure the intended rating from
each Rating Agency for the Certificates;
FEES AND EXPENSES. Subject to Section 16 hereof, the
Mortgage Loan Seller shall pay on the Closing Date or such later date as may be
agreed to by the Purchaser (i) the fees and expenses of the Mortgage Loan
Seller's attorneys and the reasonable fees and expenses of the Purchaser's
attorneys, (ii) the fees and expenses of Deloitte & Touche LLP, (iii) the fee
for the use of Purchaser's Registration Statement based on the aggregate
original principal amount of the Certificates and the filing fee of the
Commission as in effect on the date on which the Registration Statement was
declared effective, (iv) the fees and expenses including counsel's fees and
expenses in connection with any "blue sky" and legal investment matters, (v) the
fees and expenses of the Trustee which shall include without limitation the fees
and expenses of the Trustee (and the fees and disbursements of its counsel) with
respect to (A) legal and document review of this Agreement, the Pooling and
Servicing Agreement, the Certificates and related agreements, (B) attendance at
the Closing and (C) review of the Mortgage Loans to be performed by the
Custodian, (vi) the expenses for printing or otherwise reproducing the
Certificates, the Prospectus and the Prospectus Supplement, (vii) the fees and
expenses of each Rating Agency (both initial and ongoing), (viii) the fees and
expenses relating to the preparation and recordation of mortgage assignments
(including intervening assignments, if any and if available, to evidence a
complete chain of title from the originator to the Trustee) from the Mortgage
Loan Seller to the Trustee or the expenses relating to the Opinion of Counsel
referred to in Section 6(a) hereof, as the case may be, and (ix) Mortgage File
due diligence expenses and other out-of-pocket expenses incurred by the
Purchaser in connection with the purchase of the Mortgage Loans and by Bear
Xxxxxxx in connection with the sale of the Certificates. The Mortgage Loan
Seller additionally agrees to pay directly to any third party on a timely basis
the fees provided for above which are charged by such third party and which are
billed periodically.
ACCOUNTANTS' LETTERS.
(a) Deloitte & Touche LLP will review the characteristics of a
sample of the Mortgage Loans described in the Final Mortgage Loan Schedule and
will compare those characteristics to the description of the Mortgage Loans
contained in the Prospectus Supplement under the captions "Summary of Prospectus
Supplement--The Mortgage Loans", "The Mortgage Pool" and "Certain
Characteristics of the Mortgage Loans" in Schedule A thereto. The Mortgage Loan
Seller will cooperate with the Purchaser in making available all information and
taking all steps reasonably necessary to permit such accountants to complete the
review and to deliver the letters required of them under the Underwriting
Agreement. Deloitte & Touche LLP will also confirm certain calculations as set
forth under the caption "Yield On The Certificates" in the Prospectus
Supplement.
(b) To the extent statistical information with respect to the
Master Servicer or any Servicer's servicing portfolio is included in the
Prospectus Supplement under the caption "The Master Servicer and the Servicers,"
a letter from the certified public accountant for such Master Servicer, Servicer
or Servicers, as applicable, will be delivered to the Purchaser dated the date
of the Prospectus Supplement, in the form previously agreed to by the Mortgage
Loan Seller and the Purchaser, with respect to such statistical information.
INDEMNIFICATION.
(a) The Mortgage Loan Seller shall indemnify and hold harmless
the Purchaser and its directors, officers and controlling persons (as defined in
Section 15 of the Securities Act) from and against any loss, claim, damage or
liability or action in respect thereof, to which they or any of them may become
subject, under the Securities Act or otherwise, insofar as such loss, claim,
damage, liability or action arises out of, or is based upon (i) any untrue
statement of a material fact contained in the MORTGAGE LOAN SELLER'S INFORMATION
as identified in EXHIBIT 3, the omission to state in the Prospectus Supplement
or Prospectus (or any amendment thereof or supplement thereto approved by the
Mortgage Loan Seller and in which additional Mortgage Loan Seller's Information
is identified), in reliance upon and in conformity with Mortgage Loan Seller's
Information a material fact required to be stated therein or necessary to make
the statements therein in light of the circumstances in which they were made,
not misleading, (ii) any representation or warranty assigned or made by the
Mortgage Loan Seller in Section 7 or Section 8 hereof being, or alleged to be,
untrue or incorrect, or (iii) any failure by the Mortgage Loan Seller to perform
its obligations under this Agreement; and the Mortgage Loan Seller shall
reimburse the Purchaser and each other indemnified party for any legal and other
expenses reasonably incurred by them in connection with investigating or
defending or preparing to defend against any such loss, claim, damage, liability
or action.
The foregoing indemnity agreement is in addition to any
liability which the Mortgage Loan Seller otherwise may have to the Purchaser or
any other such indemnified party.
(b) The Purchaser shall indemnify and hold harmless the
Mortgage Loan Seller and its respective directors, officers and controlling
persons (as defined in Section 15 of the Securities Act) from and against any
loss, claim, damage or liability or action in respect thereof, to which they or
any of them may become subject, under the Securities Act or otherwise, insofar
as such loss, claim, damage, liability or action arises out of, or is based upon
(i) any untrue statement of a material fact contained in the PURCHASER'S
INFORMATION as identified in EXHIBIT 4, the omission to state in the Prospectus
Supplement or Prospectus (or any amendment thereof or supplement thereto
approved by the Purchaser and in which additional Purchaser's Information is
identified), in reliance upon and in conformity with the Purchaser's
Information, a material fact required to be stated therein or necessary to make
the statements therein in light of the circumstances in which they were made,
not misleading, (ii) any representation or warranty made by the Purchaser in
Section 9 hereof being, or alleged to be, untrue or incorrect, or (iii) any
failure by the Purchaser to perform its obligations under this Agreement; and
the Purchaser shall reimburse the Mortgage Loan Seller, and each other
indemnified party for any legal and other expenses reasonably incurred by them
in connection with investigating or defending or preparing to defend any such
loss, claim, damage, liability or action. The foregoing indemnity agreement is
in addition to any liability which the Purchaser otherwise may have to the
Mortgage Loan Seller, or any other such indemnified party,
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify each party against whom
indemnification is to be sought in writing of the commencement thereof (but the
failure so to notify an indemnifying party shall not relieve it from any
liability which it may have under this Section 13 except to the extent that it
has been prejudiced in any material respect by such failure or from any
liability which it may have otherwise). In case any such action is brought
against any indemnified party, and it notifies an indemnifying party of the
commencement thereof, the indemnifying party will be entitled to participate
therein and, to the extent it may elect by written notice delivered to the
indemnified party promptly (but, in any event, within 30 days) after receiving
the aforesaid notice from such indemnified party, to assume the defense thereof
with counsel reasonably satisfactory to such indemnified party. Notwithstanding
the foregoing, the indemnified party or parties shall have the right to employ
its or their own counsel in any such case, but the fees and expenses of such
counsel shall be at the expense of such indemnified party or parties unless (i)
the employment of such counsel shall have been authorized in writing by one of
the indemnifying parties in connection with the defense of such action, (ii) the
indemnifying parties shall not have employed counsel to have charge of the
defense of such action within a reasonable time after notice of commencement of
the action, or (iii) such indemnified party or parties shall have reasonably
concluded that there is a conflict of interest between itself or themselves and
the indemnifying party in the conduct of the defense of any claim or that the
interests of the indemnified party or parties are not substantially co-extensive
with those of the indemnifying party (in which case the indemnifying parties
shall not have the right to direct the defense of such action on behalf of the
indemnified party or parties), in any of which events such fees and expenses
shall be borne by the indemnifying parties; PROVIDED, HOWEVER, that the
indemnifying party shall be liable only for the fees and expenses of one counsel
in addition to one local counsel in the jurisdiction involved. Anything in this
subsection to the contrary notwithstanding, an indemnifying party shall not be
liable for any settlement or any claim or action effected without its written
consent; PROVIDED, HOWEVER, that such consent was not unreasonably withheld.
(d) If the indemnification provided for in paragraphs (a) and
(b) of this Section 13 shall for any reason be unavailable to an indemnified
party in respect of any loss, claim, damage or liability, or any action in
respect thereof, referred to in Section 13, then the indemnifying party shall in
lieu of indemnifying the indemnified party contribute to the amount paid or
payable by such indemnified party as a result of such loss, claim, damage or
liability, or action in respect thereof, in such proportion as shall be
appropriate to reflect the relative benefits received by the Mortgage Loan
Seller on the one hand and the Purchaser on the other from the purchase and sale
of the Mortgage Loans, the offering of the Mortgage Pass-Through Certificates
and the other transactions contemplated hereunder. No person found liable for a
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who is not
also found liable for such fraudulent misrepresentation.
(e) The parties hereto agree that reliance by an indemnified
party on any publicly available information or any information or directions
furnished by an indemnifying party shall not constitute negligence, bad faith or
willful misconduct by such indemnified party.
NOTICES. All demands, notices and communications
hereunder shall be in writing but may be delivered by facsimile transmission
subsequently confirmed in writing. Notices to the Mortgage Loan Seller shall be
directed to EMC Mortgage Corporation, Mac Xxxxxx Xxxxx XX, 000 Xxxxxx Xxxxx
Xxxxx, Xxxxx 000, Xxxxxx, Xxxxx 00000 (Telecopy: (972-444-2880)), and notices to
the Purchaser shall be directed to Structured Asset Mortgage Investments II
Inc., 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (Telecopy: (212-272-7206)),
Attention: Xxxxx Xxxxxxxxxxx; or to any other address as may hereafter be
furnished by one party to the other party by like notice. Any such demand,
notice or communication hereunder shall be deemed to have been received on the
date received at the premises of the addressee (as evidenced, in the case of
registered or certified mail, by the date noted on the return receipt) provided
that it is received on a business day during normal business hours and, if
received after normal business hours, then it shall be deemed to be received on
the next business day.
TRANSFER OF MORTGAGE LOANS. The Purchaser
retains the right to assign the Mortgage Loans and any or all of its interest
under this Agreement to the Trustee without the consent of the Mortgage Loan
Seller, and, upon such assignment, the Trustee shall succeed to the applicable
rights and obligations of the Purchaser hereunder; PROVIDED, HOWEVER, the
Purchaser shall remain entitled to the benefits set forth in Sections 11, 13 and
17 hereto and as provided in Section 2(a). Notwithstanding the foregoing, the
sole and exclusive right and remedy of the Trustee with respect to a breach of
representation or warranty of the Mortgage Loan Seller shall be the purchase or
substitution obligations of the Mortgage Loan Seller contained in Sections 5 and
7 hereof.
TERMINATION. This Agreement may be terminated (a) by
the mutual consent of the parties hereto prior to the Closing Date, (b) by the
Purchaser, if the conditions to the Purchaser's obligation to close set forth
under Section 10(a) hereof are not fulfilled as and when required to be
fulfilled or (c) by the Mortgage Loan Seller, if the conditions to the Mortgage
Loan Seller's obligation to close set forth under Section 10(b) hereof are not
fulfilled as and when required to be fulfilled. In the event of termination
pursuant to clause (b), the Mortgage Loan Seller shall pay, and in the event of
termination pursuant to clause (c), the Purchaser shall pay, all reasonable
out-of-pocket expenses incurred by the other in connection with the transactions
contemplated by this Agreement. In the event of a termination pursuant to clause
(a), each party shall be responsible for its own expenses.
REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO
SURVIVE DELIVERY. All representations, warranties and agreements contained in
this Agreement, or contained in certificates of officers of the Mortgage Loan
Seller submitted pursuant hereto, shall remain operative and in full force and
effect and shall survive delivery of the Mortgage Loans to the Purchaser (and by
the Purchaser to the Trustee). Subsequent to the delivery of the Mortgage Loans
to the Purchaser, the Mortgage Loan Seller's representations and warranties
contained herein with respect to the Mortgage Loans shall be deemed to relate to
the Mortgage Loans actually delivered to the Purchaser and included in the Final
Mortgage Loan Schedule and any Substitute Mortgage Loan and not to those
Mortgage Loans deleted from the Preliminary Mortgage Loan Schedule pursuant to
Section 3 hereof prior to the Closing.
SEVERABILITY. If any provision of this Agreement
shall be prohibited or invalid under applicable law, the Agreement shall be
ineffective only to such extent, without invalidating the remainder of this
Agreement.
COUNTERPARTS. This Agreement may be executed in
counterparts, each of which will be an original, but which together shall
constitute one and the same agreement.
AMENDMENT. This Agreement cannot be amended or
modified in any manner without the prior written consent of each party.
GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REGARD TO CONFLICT OF LAWS PRINCIPLES THEREOF OTHER THAN SECTION 5-1401 OF THE
NEW YORK GENERAL OBLIGATIONS LAW.
FURTHER ASSURANCES. Each of the parties agrees to
execute and deliver such instruments and take such actions as another party may,
from time to time, reasonably request in order to effectuate the purpose and to
carry out the terms of this Agreement including any amendments hereto which may
be required by either Rating Agency.
SUCCESSORS AND ASSIGNS.
This Agreement shall bind and inure to the benefit of and be
enforceable by the Mortgage Loan Seller and the Purchaser and their permitted
successors and assigns and, to the extent specified in Section 13 hereof, Bear
Xxxxxxx, and their directors, officers and controlling persons (within the
meaning of federal securities laws). The Mortgage Loan Seller acknowledges and
agrees that the Purchaser may assign its rights under this Agreement (including,
without limitation, with respect to the Mortgage Loan Seller's representations
and warranties respecting the Mortgage Loans) to the Trustee. Any person into
which the Mortgage Loan Seller may be merged or consolidated (or any person
resulting from any merger or consolidation involving the Mortgage Loan Seller),
any person resulting from a change in form of the Mortgage Loan Seller or any
person succeeding to the business of the Mortgage Loan Seller, shall be
considered the "successor" of the Mortgage Loan Seller hereunder and shall be
considered a party hereto without the execution or filing of any paper or any
further act or consent on the part of any party hereto. Except as provided in
the two preceding sentences, this Agreement cannot be assigned, pledged or
hypothecated by either party hereto without the written consent of the other
parties to this Agreement and any such assignment or purported assignment shall
be deemed null and void.
THE MORTGAGE LOAN SELLER. The Mortgage Loan Seller will keep
in full force and effect its existence, all rights and franchises as a
corporation under the laws of the State of its incorporation and will obtain and
preserve its qualification to do business as a foreign corporation in each
jurisdiction in which such qualification is necessary to perform its obligations
under this Agreement.
ENTIRE AGREEMENT. This Agreement contains the entire
agreement and understanding between the parties with respect to the subject
matter hereof, and supersedes all prior and contemporaneous agreements,
understandings, inducements and conditions, express or implied, oral or written,
of any nature whatsoever with respect to the subject matter hereof.
NO PARTNERSHIP. Nothing herein contained shall be
deemed or construed to create a partnership or joint venture between the parties
hereto.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the parties hereto have caused their names to be
signed hereto by their respective duly authorized officers as of the date first
above written.
EMC MORTGAGE CORPORATION
By:
-------------------------
Name: Xxxx Xxxxxxx
Title: Senior Vice President
STRUCTURED ASSET MORTGAGE
INVESTMENTS II INC.
By:
-------------------------
Name: Xxxxx Xxxxxxxxxxx
Title: Vice President
EXHIBIT 1
CONTENTS OF MORTGAGE FILE
With respect to each Mortgage Loan, the Mortgage File shall include
each of the following items, which shall be available for inspection by the
Purchaser or its designee, and which shall be delivered to the Purchaser or its
designee pursuant to the terms of the Agreement.
(a) with respect to each Mortgage Loan (other than a Cooperative Loan):
(i) The original Mortgage Note, endorsed without recourse to
the order of the Trustee and showing an unbroken chain of endorsements
from the originator thereof to the Person endorsing it to the Trustee,
or a lost note affidavit together with a copy of the related Mortgage
Note;
(ii) The original Mortgage and, if the related Mortgage Loan
is a MOM Loan, noting the presence of the MIN and language indicating
that such Mortgage Loan is a MOM Loan, which shall have been recorded
(or if the original is not available, a copy), with evidence of such
recording indicated thereon (or if the original is not available, a
copy), with evidence of such recording indicated thereon (or if the
original Security Instrument, assignments to the Trustee or intervening
assignments thereof which have been delivered, are being delivered or
will, upon receipt of recording information relating to the Security
Instrument required to be included thereon, be delivered to recording
offices for recording and have not been returned to the Seller in time
to permit their recording as specified in Section 2.01(b) of the
Pooling and Servicing Agreement, shall be in recordable form);
(iii) unless the Mortgage Loan is a MOM Loan, a certified copy
of the assignment (which may be in the form of a blanket assignment if
permitted in the jurisdiction in which the Mortgaged Property is
located) to "U.S. Bank National Association, as Trustee", with evidence
of recording with respect to each Mortgage Loan in the name of the
Trustee thereon (or if (A) the original Security Instrument,
assignments to the Trustee or intervening assignments thereof which
have been delivered, are being delivered or will, upon receipt of
recording information relating to the Security Instrument required to
be included thereon, be delivered to recording offices for recording
and have not been returned to the Seller in time to permit their
delivery as specified in Section 2.01(b) of the Pooling and Servicing
Agreement, the Seller may deliver a true copy thereof with a
certification by the Seller, on the face of such copy, substantially as
follows: "Certified to be a true and correct copy of the original,
which has been transmitted for recording" or (B) the related Mortgaged
Property is located in a state other than Maryland and an Opinion of
Counsel has been provided as set forth in Section 2.01(b) of the
Pooling and Servicing Agreement, shall be in recordable form);
(iv) all intervening assignments of the Security Instrument,
if applicable and only to the extent available to the Mortgage Loan
Seller with evidence of recording thereon;
(v) the original or a copy of the policy or certificate of
primary mortgage guaranty insurance, to the extent available, if any;
(vi) the original policy of title insurance or mortgagee's
certificate of title insurance or commitment or binder for title
insurance; and
(vii) originals of all modification agreements, if applicable
and available.
(b) with respect to each Cooperative Loan so assigned:
(i) The original Mortgage Note, endorsed without recourse to
the order of the Trustee and showing an unbroken chain of endorsements
from the originator thereof to the Person endorsing it to the Trustee,
or lost note affidavit, together with a copy of the related Mortgage
Note;
(ii) A counterpart of the Cooperative Lease and the Assignment
of Proprietary Lease to the originator of the Cooperative Loan with
intervening assignments showing an unbroken chain of title from such
originator to the Trustee;
(iii) The related Cooperative Stock Certificate, representing
the related Cooperative Stock pledged with respect to such Cooperative
Loan, together with an undated stock power (or other similar
instrument) executed in blank;
(iv) The original recognition agreement by the Cooperative of
the interests of the mortgagee with respect to the related Cooperative
Loan and any transfer documents related to the recognition agreement;
(v) The Security Agreement;
(vi) Copies of the original UCC-1 financing statement, and any
continuation statements, filed by the originator of such Cooperative
Loan as secured party, each with evidence of recording thereof,
evidencing the interest of the originator under the Security Agreement
and the Assignment of Proprietary Lease;
(vii) Copies of the filed UCC-3 assignments of the security
interest referenced in clause (vi) above showing an unbroken chain of
title from the originator to the Trustee, each with evidence of
recording thereof, evidencing the interest of the originator under the
Security Agreement and the Assignment of Proprietary Lease;
(viii) An executed assignment of the interest of the
originator in the Security Agreement and Assignment of Proprietary
Lease, showing an unbroken chain of title from the originator to the
Trustee; and
(ix) The original of each modification, assumption agreement
or preferred loan agreement, if any, relating to such Cooperative Loan.
EXHIBIT 2
MORTGAGE LOAN SCHEDULE INFORMATION
The Preliminary and Final Mortgage Loan Schedules shall set forth the
following information with respect to each Mortgage Loan:
(a) the loan number;
(b) the city, state and zip code of the Mortgaged Property;
(c) the property type;
(d) the Mortgage Interest Rate;
(e) the Servicing Rate;
(f) the Net Rate;
(g) the original term;
(h) the maturity date;
(i) the stated remaining term to maturity;
(j) the original principal balance;
(k) the first payment date;
(l) the principal and interest payment in effect as of the Cut-off Date;
(m) the unpaid principal balance as of the Cut-off Date;
(n) the Loan-to-Value Ratio at origination;
(o) paid-through date;
(p) the insurer of any Primary Mortgage Insurance Policy;
(q) the Gross Margin, if applicable;
(r) the Maximum Lifetime Mortgage Rate, if applicable;
(s) the Minimum Lifetime Mortgage Rate, if applicable;
(t) the Periodic Rate Cap, if applicable;
(u) the number of days delinquent, if any;
(v) which Mortgage Loans adjust after an initial fixed-rate period of three,
five, seven or ten years;
(w) the Loan Group; and
(x) the Servicer.
Such schedule also shall set forth for all of the Mortgage Loans, the total
number of Mortgage Loans, the total of each of the amounts described under (k)
and (n) above, the weighted average by principal balance as of the Cut-off Date
of each of the rates described under (e), (f) and (g) above, and the weighted
average remaining term to maturity by unpaid principal balance as of the Cut-off
Date.
EXHIBIT 3
MORTGAGE LOAN SELLER'S INFORMATION
All information in the Prospectus Supplement described under the
following Sections: "SUMMARY OF PROSPECTUS SUPPLEMENT--The Mortgage Loans," "THE
MORTGAGE POOL" and "SCHEDULE A--CERTAIN CHARACTERISTICS OF THE MORTGAGE LOANS."
EXHIBIT 4
PURCHASER'S INFORMATION
All information in the Prospectus Supplement and the Prospectus, except
the Mortgage Loan Seller's Information.
EXHIBIT 5
SCHEDULE OF LOST NOTES
Available Upon Request
EXHIBIT 6
APPENDIX E - Standard & Poor's Anti-Predatory Lending Categorization
REVISED FEBRUARY 07, 2005
Standard & Poor's has categorized loans governed by anti-predatory lending laws
in the Jurisdictions listed below into three categories based upon a combination
of factors that include (a) the risk exposure associated with the assignee
liability and (b) the tests and thresholds set forth in those laws. Note that
certain loans classified by the relevant statute as Covered are included in
Standard & Poor's High Cost Loan Category because they included thresholds and
tests that are typical of what is generally considered High Cost by the
industry.
STANDARD & POOR'S HIGH COST LOAN CATEGORIZATION
-----------------------------------------------
-----------------------------------------------------------------------------------------------------------------------
NAME OF ANTI-PREDATORY CATEGORY UNDER APPLICABLE
STATE/JURISDICTION LENDING LAW/EFFECTIVE DATE ANTI-PREDATORY LENDING LAW
---------------------------------- ------------------------------------------------- --------------------------------
Arkansas Arkansas Home Loan Protection Act, Ark. Code High Cost Home Loan
Xxx. xx.xx. 00-00-000 ET SEQ.
Effective July 16, 2003
---------------------------------- ------------------------------------------------- --------------------------------
Cleveland Heights, OH Ordinance No. 72-2003 (PSH), Mun. Code Covered Loan
xx.xx. 757.01 ET SEQ.
Effective June 2, 2003
---------------------------------- ------------------------------------------------- --------------------------------
Colorado Consumer Equity Protection, Colo. Stat. Xxx. Covered Loan
xx.xx. 5-3.5-101 ET SEQ.
Effective for covered loans offered or entered
into on or after January 1, 2003. Other
provisions of the Act took effect on June 7,
2002
---------------------------------- ------------------------------------------------- --------------------------------
Connecticut Connecticut Abusive Home Loan Lending Practices High Cost Home Loan
Act, Conn. Gen. Stat. xx.xx. 36a-746 ET SEQ.
Effective October 1, 2001
---------------------------------- ------------------------------------------------- --------------------------------
District of Columbia Home Loan Protection Act, D.C. Code Covered Loan
xx.xx. 26-1151.01 ET SEQ.
Effective for loans closed on or after January
28, 2003
---------------------------------- ------------------------------------------------- --------------------------------
Florida Fair Lending Act, Fla. Stat. Xxx. xx.xx. High Cost Home Loan
494.0078 et SEQ.
Effective October 2, 2002
---------------------------------- ------------------------------------------------- --------------------------------
Georgia (Oct. 1, 2002 - Georgia Fair Lending Act, Ga. Code Xxx. High Cost Home Loan
Mar. 6, 2003) xx.xx. 7-6A-1 ET SEQ.
Effective October 1, 2002 - March 6, 2003
---------------------------------- ------------------------------------------------- --------------------------------
Georgia as amended (Mar. 7, 0000 Xxxxxxx Xxxx Xxxxxxx Xxx, Xx. Code Xxx. High Cost Home Loan
- current) xx.xx. 7-6A-1 ET SEQ.
Effective for loans closed on or after March 7,
2003
---------------------------------- ------------------------------------------------- --------------------------------
HOEPA Section 32 Home Ownership and Equity Protection Act High Cost Loan
of 1994, 15 U.S.C. ss. 1639, 12 C.F.R. xx.xx.
226.32 and 226.34
Effective October 1, 1995, amendments October
1, 2002
---------------------------------- ------------------------------------------------- --------------------------------
Illinois High Risk Home Loan Act, Ill. Comp. Stat. tit. High Risk Home Loan
815, xx.xx. 137/5 ET SEQ.
Effective January 1, 2004 (prior to this date,
regulations under Residential Mortgage License
Act effective from May 14, 2001)
---------------------------------- ------------------------------------------------- --------------------------------
Indiana Indiana Home Loan Practices Act, Ind. Code Xxx. High Cost Home Loan
xx.xx. 24-9-1-1 ET SEQ.
Effective for loans originated on or after
January 1, 2005.
---------------------------------- ------------------------------------------------- --------------------------------
Kansas Consumer Credit Code, Kan. Stat. Xxx. High Loan to Value Consumer
xx.xx. 16a-1-101 ET SEQ. Loan (ID. ss. 16a-3-207) and;
Sections 16a-1-301 and 16a-3-207 became --------------------------------
effective April 14, 1999; Section 16a-3-308a High APR Consumer Loan (ID. ss.
became effective July 1, 1999 16a-3-308a)
---------------------------------- ------------------------------------------------- --------------------------------
Kentucky 2003 KY H.B. 000 - Xxxx Xxxx Xxxx Xxxx Xxx, Xx. High Cost Home Loan
Rev. Stat. xx.xx. 360.100 ET SEQ.
Effective June 24, 2003
---------------------------------- ------------------------------------------------- --------------------------------
Maine Truth in Lending, Me. Rev. Stat. tit. 9-A, High Rate High Fee Mortgage
xx.xx. 8-101 ET SEQ.
Effective September 29, 1995 and as amended
from time to time
---------------------------------- ------------------------------------------------- --------------------------------
Massachusetts Part 40 and Part 32, 209 C.M.R. xx.xx. High Cost Home Loan
32.00 ET seq. and 209 C.M.R. xx.xx. 40.01 ET
SEQ.
Effective March 22, 2001 and amended from time
to time
---------------------------------- ------------------------------------------------- --------------------------------
Massachusetts Predatory Home Loan Practices Act High Cost Home Mortgage Loan
Mass. Gen. Laws ch. 183C, xx.xx. 1 ET SEQ.
Effective November 7, 2004
---------------------------------- ------------------------------------------------- --------------------------------
Nevada Assembly Xxxx No. 284, Nev. Rev. Stat. Home Loan
xx.xx. 598D.010 ET SEQ.
Effective October 1, 2003
---------------------------------- ------------------------------------------------- --------------------------------
New Jersey New Jersey Home Ownership Security Act of 2002, High Cost Home Loan
N.J. Rev. Stat. xx.xx. 46:10B-22 ET SEQ.
Effective for loans closed on or after November
27, 2003
---------------------------------- ------------------------------------------------- --------------------------------
New Mexico Home Loan Protection Act, N.M. Rev. Stat. High Cost Home Loan
xx.xx. 58-21A-1 ET SEQ.
Effective as of January 1, 2004; Revised as of
February 26, 2004
---------------------------------- ------------------------------------------------- --------------------------------
New York N.Y. Banking Law Article 6-l High Cost Home Loan
Effective for applications made on or after
April 1, 2003
---------------------------------- ------------------------------------------------- --------------------------------
North Carolina Restrictions and Limitations on High Cost Home High Cost Home Loan
Loans, N.C. Gen. Stat. xx.xx. 24-1.1E ET SEQ.
Effective July 1, 2000; amended October 1,
2003 (adding open-end lines of credit)
---------------------------------- ------------------------------------------------- --------------------------------
Ohio H.B. 386 (codified in various sections of the Covered Loan
Ohio Code), Ohio Rev. Code Xxx. xx.xx.
1349.25 ET SEQ.
Effective May 24, 2002
---------------------------------- ------------------------------------------------- --------------------------------
Oklahoma Consumer Credit Code (codified in various Subsection 10 Mortgage
sections of Title 14A)
Effective July 1, 2000; amended effective
January 1, 2004
---------------------------------- ------------------------------------------------- --------------------------------
South Carolina South Carolina High Cost and Consumer Home High Cost Home Loan
Loans Act, S.C. Code Xxx. xx.xx. 37-23-10 ET SEQ.
Effective for loans taken on or after January
1, 2004
---------------------------------- ------------------------------------------------- --------------------------------
West Virginia West Virginia Residential Mortgage Lender, West Virginia Mortgage Loan
Broker and Servicer Act, W. Va. Code Xxx. xx.xx. Act Loan
31-17-1 ET SEQ.
Effective June 5, 2002
---------------------------------- ------------------------------------------------- --------------------------------
STANDARD & POOR'S COVERED LOAN CATEGORIZATION
---------------------------------------------
-----------------------------------------------------------------------------------------------------------------------
NAME OF ANTI-PREDATORY CATEGORY UNDER APPLICABLE
STATE/JURISDICTION LENDING LAW/EFFECTIVE DATE ANTI-PREDATORY LENDING LAW
---------------------------------- ------------------------------------------------- --------------------------------
Georgia (Oct. 1, 2002 - Mar. 0, Xxxxxxx Xxxx Xxxxxxx Xxx, Xx. Code Xxx. Covered Loan
2003) xx.xx. 7-6A-1 ET SEQ.
Effective October 1, 2002 - March 6, 2003
---------------------------------- ------------------------------------------------- --------------------------------
New Jersey New Jersey Home Ownership Security Act of 2002, Covered Home Loan
N.J. Rev. Stat. xx.xx. 46:10B-22 ET SEQ.
Effective November 27, 2003 - July 5, 2004
---------------------------------- ------------------------------------------------- --------------------------------
STANDARD & POOR'S HOME LOAN CATEGORIZATION
---------------------------------------------
-----------------------------------------------------------------------------------------------------------------------
NAME OF ANTI-PREDATORY CATEGORY UNDER APPLICABLE
STATE/JURISDICTION LENDING LAW/EFFECTIVE DATE ANTI-PREDATORY LENDING LAW
---------------------------------- ------------------------------------------------- --------------------------------
Georgia (Oct. 1, 2002 - Mar. 0, Xxxxxxx Xxxx Xxxxxxx Xxx, Xx. Code Xxx. Home Loan
2003) xx.xx. 7-6A-1 ET SEQ.
Effective October 1, 2002 - March 6, 2003
---------------------------------- ------------------------------------------------- --------------------------------
New Jersey New Jersey Home Ownership Security Act of 2002, Home Loan
N.J. Rev. Stat. xx.xx. 46:10B-22 ET SEQ.
Effective for loans closed on or after November
27, 2003
---------------------------------- ------------------------------------------------- --------------------------------
New Mexico Home Loan Protection Act, N.M. Rev. Stat. . Home Loan
ss. ss 58-21A-1 ET SEQ.
Effective as of January 1, 2004; Revised as of
February 26, 2004
---------------------------------- ------------------------------------------------- --------------------------------
North Carolina Restrictions and Limitations on High Cost Home Consumer Home Loan
Loans, N.C. Gen. Stat. xx.xx. 24-1.1E ET SEQ.
Effective July 1, 2000; amended October 1,
2003 (adding open-end lines of credit)
---------------------------------- ------------------------------------------------- --------------------------------
South Carolina South Carolina High Cost and Consumer Home Consumer Home Loan
Loans Act, S.C. Code Xxx. xx.xx. 37-23-10 ET SEQ.
Effective for loans taken on or after January
1, 2004
---------------------------------- ------------------------------------------------- --------------------------------
STANDARD & POOR'S COVERED LOAN CATEGORIZATION
---------------------------------------------
-----------------------------------------------------------------------------------------------------------------------
NAME OF ANTI-PREDATORY CATEGORY UNDER APPLICABLE
STATE/JURISDICTION LENDING LAW/EFFECTIVE DATE ANTI-PREDATORY LENDING LAW
---------------------------------- ------------------------------------------------- --------------------------------
Georgia (Oct. 1, 2002 - Mar. 0, Xxxxxxx Xxxx Xxxxxxx Xxx, Xx. Code Xxx. Covered Loan
2003) xx.xx. 7-6A-1 ET SEQ.
Effective October 1, 2002 - March 6, 2003
---------------------------------- ------------------------------------------------- --------------------------------
New Jersey New Jersey Home Ownership Security Act of 2002, Covered Home Loan
N.J. Rev. Stat. xx.xx. 46:10B-22 ET SEQ.
Effective November 27, 2003 - July 5, 2004
---------------------------------- ------------------------------------------------- --------------------------------
STANDARD & POOR'S HOME LOAN CATEGORIZATION
------------------------------------------
-----------------------------------------------------------------------------------------------------------------------
NAME OF ANTI-PREDATORY CATEGORY UNDER APPLICABLE
STATE/JURISDICTION LENDING LAW/EFFECTIVE DATE ANTI-PREDATORY LENDING LAW
---------------------------------- ------------------------------------------------- --------------------------------
Georgia (Oct. 1, 2002 - Mar. 0, Xxxxxxx Xxxx Xxxxxxx Xxx, Xx. Code Xxx. Home Loan
2003) xx.xx. 7-6A-1 ET SEQ.
Effective October 1, 2002 - March 6, 2003
---------------------------------- ------------------------------------------------- --------------------------------
New Jersey New Jersey Home Ownership Security Act of 2002, Home Loan
N.J. Rev. Stat. xx.xx. 46:10B-22 ET SEQ.
Effective for loans closed on or after November
27, 2003
---------------------------------- ------------------------------------------------- --------------------------------
New Mexico Home Loan Protection Act, N.M. Rev. Stat. Home Loan
xx.xx. 58-21A-1 ET SEQ.
Effective as of January 1, 2004; Revised as of
February 26, 2004
---------------------------------- ------------------------------------------------- --------------------------------
North Carolina Restrictions and Limitations on High Cost Home Consumer Home Loan
Loans, N.C. Gen. Stat. xx.xx. 24-1.1E ET SEQ.
Effective July 1, 2000; amended October 1,
2003 (adding open-end lines of credit)
---------------------------------- ------------------------------------------------- --------------------------------
South Carolina South Carolina High Cost and Consumer Home Consumer Home Loan
Loans Act, S.C. Code Xxx. xx.xx. 37-23-10 ET SEQ.
Effective for loans taken on or after January
1, 2004
---------------------------------- ------------------------------------------------- --------------------------------
SCHEDULE A
REQUIRED RATINGS FOR EACH CLASS OF CERTIFICATES
PUBLIC CERTIFICATES
Class Fitch S&P
------------------------------------- ------- -------
Class I-A-1.......................... AAA AAA
Class I-A-2.......................... AAA AAA
Class I-A-3.......................... AAA AAA
Class I-PO........................... AAA AAA
Class I-X............................ AAA AAA
Class I-R-1.......................... AAA AAA
Class I-R-2.......................... AAA AAA
Class I-B-1.......................... AA --
Class I-B-2.......................... A --
Class I-B-3.......................... BBB --
Class II-A-1......................... AAA AAA
Class II-R-1......................... AAA AAA
Class II-B-1......................... AA --
Class II-B-2......................... A --
Class II-B-3......................... BBB --
Class II-XB.......................... -- --
None of the above ratings have been lowered since the respective dates of such
letters.
PRIVATE CERTIFICATES
Class Fitch
------------------------------------- --------
Class I-B-4.......................... BB
Class I-B-5.......................... B
Class I-B-6.......................... --
Class II-B-4......................... BB
Class II-B-5......................... B
Class II-B-6......................... --
None of the above ratings have been lowered since the respective dates of such
letters.
SCHEDULE B
MORTGAGE LOAN SCHEDULE
[Provided upon request]
EXHIBIT K
Certificate Guaranty Insurance Policy
(Provided upon request)
