Exhibit 4.1
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SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.
Depositor
and
FIRST TRUST NATIONAL ASSOCIATION,
Trustee
TRUST AGREEMENT
Dated as of September 30, 1996
Trust Certificates
Series 1996-4
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TABLE OF CONTENTS
Section Page
ARTICLE I
DEFINITIONS
1.01. Definitions .......................................................... 2
Affiliate .................................................................. 2
Available Funds ............................................................ 2
Book-Entry Certificate ..................................................... 2
Business Day ............................................................... 2
Certificate ................................................................ 2
Certificate Account ........................................................ 2
Certificate Factor ......................................................... 2
Certificate Owner .......................................................... 2
Certificate Principal Balance .............................................. 3
Certificate Register and Certificate Registrar ............................. 3
Certificateholder or Holder ................................................ 3
Class ...................................................................... 3
Class 4A Certificates ...................................................... 3
Class 4B Certificates ...................................................... 3
Class 4C Certificates ...................................................... 3
Class 4D Certificates ...................................................... 3
Closing Date ............................................................... 3
Code ....................................................................... 3
Commission ................................................................. 3
Corporate Trust Office ..................................................... 3
Depositor .................................................................. 4
Depository ................................................................. 4
Depository Participant ..................................................... 4
Distribution Date .......................................................... 4
DTC ........................................................................ 4
Eligible Account ........................................................... 4
Eligible Investments ....................................................... 4
ERISA ...................................................................... 6
Extraordinary Trust Fund Expenses .......................................... 6
FHLMC ...................................................................... 6
Final Distribution Date .................................................... 6
Independent ................................................................ 6
Interest Accrual Period .................................................... 6
Interest Distribution Amount ............................................... 6
Officer's Certificate ...................................................... 7
Opinion of Counsel ......................................................... 7
Ownership Interest ......................................................... 7
Pass-Through Rate .......................................................... 7
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Section Page
Percentage Interest ....................................................... 7
Person .................................................................... 7
Pooling and Servicing Agreement ........................................... 7
Principal Distribution Amount ............................................. 8
Rating Agency ............................................................. 8
Realized Loss ............................................................. 8
Record Date ............................................................... 8
RELATED CLASS ............................................................. 8
RELATED UNDERLYING CERTIFICATES ........................................... 8
Responsible Officer ....................................................... 8
Single Certificate ........................................................ 9
Transfer .................................................................. 9
Transferee ................................................................ 9
Trust ..................................................................... 9
Trustee ................................................................... 9
Trustee Fee ............................................................... 9
Trustee Fee Rate .......................................................... 9
Trust Fund ................................................................ 9
Underlying Certificates ................................................... 9
Underlying Certificate Distribution Date .................................. 9
Underlying Certificate Distribution Date Statements ....................... 10
Underlying Certificate Schedule ........................................... 10
UNDERLYING INTEREST DISTRIBUTION AMOUNT ................................... 10
Underlying Prudential Certificates ........................................ 10
Underlying GECMSI Certificates ............................................ 10
Underlying CWMBS Certificates ............................................. 10
Underlying RFMSI Certificates ............................................. 10
Voting Rights ............................................................. 10
1.02. INTEREST CALCULATION ................................................ 10
ARTICLE II
CONVEYANCE OF THE UNDERLYING CERTIFICATES
AND THE ORIGINAL ISSUANCE OF CERTIFICATES
2.01. CONVEYANCE OF THE UNDERLYING CERTIFICATES ........................... 11
2.02. ISSUANCE OF CERTIFICATES ............................................ 11
ARTICLE III
ADMINISTRATION OF THE UNDERLYING CERTIFICATES
3.01. COLLECTION OF PAYMENTS ON THE UNDERLYING CERTIFICATES; CERTIFICATE
ACCOUNT ............................................................. 12
3.02. DISTRIBUTIONS ....................................................... 13
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Section Page
3.03. STATEMENTS TO CERTIFICATEHOLDERS .................................... 15
3.04. ALLOCATION OF EXTRAORDINARY TRUST FUND EXPENSES AND REALIZED LOSSES . 17
3.05. NOTICES TO TRUSTEE .................................................. 17
3.06. EXCHANGE COMMISSION; ADDITIONAL INFORMATION ......................... 17
ARTICLE IV
THE CERTIFICATES
4.01. THE CERTIFICATES .................................................... 19
4.02. REGISTRATION OF AND LIMITATIONS ON TRANSFER AND EXCHANGE OF
CERTIFICATES ........................................................ 20
4.03. MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES ................... 21
4.04. PERSONS DEEMED OWNERS ............................................... 21
ARTICLE V
THE DEPOSITOR
5.01. LIABILITY OF THE DEPOSITOR .......................................... 22
5.02. MERGER OR CONSOLIDATION OF THE DEPOSITOR ............................ 22
5.03. LIMITATION ON LIABILITY OF THE DEPOSITOR AND OTHERS ................. 22
ARTICLE VI
THE TRUSTEE
6.01. DUTIES OF TRUSTEE ................................................... 24
6.02. CERTAIN MATTERS AFFECTING THE TRUSTEE ............................... 25
6.03. TRUSTEE NOT LIABLE FOR CERTIFICATES ................................. 26
6.04. TRUSTEE MAY OWN CERTIFICATES ........................................ 26
6.05. TRUSTEE'S FEES AND EXPENSES ......................................... 26
6.06. ELIGIBILITY REQUIREMENTS FOR TRUSTEE ................................ 26
6.07. RESIGNATION AND REMOVAL OF THE TRUSTEE .............................. 27
6.08. SUCCESSOR TRUSTEE ................................................... 27
6.09. MERGER OR CONSOLIDATION OF TRUSTEE .................................. 28
6.10. APPOINTMENT OF OFFICE OR AGENCY ..................................... 28
6.11. REPRESENTATIONS AND WARRANTIES OF THE TRUSTEE ....................... 28
6.12. CERTIFICATE ACCOUNT STATEMENTS ...................................... 29
6.13. GRANTOR TRUST REPORTING ............................................. 29
6.14. COMPLIANCE WITH WITHHOLDING REQUIREMENTS ............................ 29
ARTICLE VII
TERMINATION
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7.01. TERMINATION UPON DISTRIBUTION TO CERTIFICATEHOLDERS ................. 31
7.02. FAILURE OF CERTIFICATEHOLDERS TO SURRENDER CERTIFICATES ............. 31
ARTICLE VIII
MISCELLANEOUS PROVISIONS
8.01. AMENDMENT ........................................................... 32
8.02. LIMITATION ON RIGHTS OF CERTIFICATEHOLDERS .......................... 33
8.03. GOVERNING LAW ....................................................... 33
8.04. NOTICES ............................................................. 34
8.05. SEVERABILITY OF PROVISIONS .......................................... 34
8.06. NOTICE TO RATING AGENCY ............................................. 34
8.07. ARTICLE AND SECTION REFERENCES ...................................... 35
8.08. EXECUTION IN COUNTERPARTS ........................................... 35
EXHIBITS
EXHIBIT A Form of Certificates
EXHIBIT B Schedule of Underlying Certificates
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This is a Trust Agreement ("Trust Agreement" or "Agreement"),
dated as of September 30, 1996, by and between SALOMON BROTHERS MORTGAGE
SECURITIES VII, INC., as Depositor (the "Depositor") and FIRST TRUST NATIONAL
ASSOCIATION, as Trustee (the "Trustee").
PRELIMINARY STATEMENT:
The Depositor intends to sell pass-through trust certificates
(collectively, the "Certificates"), to be issued hereunder, which will evidence
the entire beneficial ownership interest in the Trust Fund created hereunder.
The following table irrevocably sets forth the initial
variable Pass-Through Rate and the initial Certificate Principal Balance for the
Trust Certificates.
Initial Aggregate
Class Pass-Through Rate Certificate Principal Balance
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4A-A1 6.860% $12,250,000
4A-A2 6.860% 36,750,000
4B-A1 6.485% 7,158,376
4B-A2 6.485% 13,340,000
4B-A3 6.485% 22,080,000
4C-A1 6.485% 5,349,801
4C-A2 6.485% 42,737,989
4D-A1 6.985% 2,619,947
4D-A2 6.985% 13,418,955
4D-A3 6.985% 14,409,709
4D-A4 6.985% 3,047,638
As of the Closing Date, the Underlying Certificates have an aggregate
outstanding principal balance equal to $173,162,415.
In consideration of the mutual agreements herein contained, the
Depositor and the Trustee agree as follows:
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ARTICLE I
DEFINITIONS
Section 1.01. Definitions. Whenever used in this Trust Agreement, the
following words and phrases, unless the context otherwise requires, shall have
the following meanings:
AFFILIATE: With respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control" when used with respect to any
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
AVAILABLE FUNDS: As to any Distribution Date, the difference between
(a) the aggregate distributions on the Underlying Certificates for the related
Underlying Certificate Distribution Date and (b) the sum of (i) the Trustee Fee
with respect to such Distribution Date and (ii) the amount of any Extraordinary
Trust Fund Expenses.
BOOK-ENTRY CERTIFICATE: The Certificates of any Class for so long as
the Certificates of such Class shall be registered in the name of the Depository
or its nominee.
BUSINESS DAY: Any "Business Day" under any Pooling and Servicing
Agreement.
CERTIFICATE: Any one of the Class 4A-A1, Class 4A-A2, Class 4B-A1,
Class 4B-A2, Class 4B-A3, Class 4C-A1, Class 4C-A2, Class 4D-A1, Class 4D-A2,
Class 4D-A3 or Class 4D-A4 Certificates executed by the Trustee in substantially
the form set forth in Exhibit A hereto.
CERTIFICATE ACCOUNT: The trust account, which must be an Eligible
Account, established and maintained pursuant to Section 3.01. Funds deposited in
the Certificate Account shall be held in trust for the benefit of the
Certificateholders for the uses and purposes set forth in Article III hereof.
CERTIFICATE FACTOR: With respect to any Certificate, as of any
Distribution Date, a fraction, expressed as a decimal carried to six places, the
numerator of which is the aggregate Certificate Principal Balance of the
Certificates on such Distribution Date (after giving effect to any distributions
of principal and allocations of Realized Losses and Extraordinary Trust Fund
Expenses in reduction of the Certificate Principal Balance of such Class of
Certificates to be made on such Distribution Date) and the denominator of which
is the initial aggregate Certificate Principal Balance of the Certificates as of
the Closing Date.
CERTIFICATE OWNER: With respect to a Book-Entry Certificate, the Person
who is the beneficial owner of such Certificate as reflected on the books of the
Depository or on the books of a Depository Participant or on the books of an
indirect participating brokerage firm for which a Depository Participant acts as
agent.
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CERTIFICATE PRINCIPAL BALANCE: With respect to any Certificate, as of
any date of determination, the initial Certificate Principal Balance reduced by
the aggregate of all distributions of principal made thereon and the principal
portion of all Realized Losses and Extraordinary Trust Fund Expenses allocated
thereto.
CERTIFICATE REGISTER AND CERTIFICATE REGISTRAR: The register maintained
and the registrar appointed pursuant to Section 4.02.
CERTIFICATEHOLDER OR HOLDER: The person in whose name a Certificate is
registered in the Certificate Register, solely for the purpose of giving any
consent pursuant to this Agreement, any Certificate registered in the name of
the Depositor or any Affiliate thereof shall be deemed not to be outstanding and
the Voting Rights to which it is entitled shall not be taken into account in
determining whether the requisite percentage of Voting Rights necessary to
effect any such consent has been obtained, except as otherwise provided in
Section 8.01. The Trustee shall be required to recognize as a "Holder" or
"Certificateholder" only the Person in whose name a Certificate is registered in
the Certificate Register. All references herein to "Holders" or
"Certificateholders" shall reflect the rights of Certificate Owners as they may
indirectly exercise such rights through the Depository and participating members
thereof, except as otherwise specified herein.
CLASS: Collectively, all of the Certificates of the same class
designation.
CLASS 4A CERTIFICATES: Collectively, the Class 4A-A1 and Class 4A-A2
Certificates.
CLASS 4B CERTIFICATES: Collectively, the Class 4B-A1, Class 4B-A2 and
Class 4B-A3 Certificates.
CLASS 4C CERTIFICATES: Collectively, the Class 4C-A1 and Class 4C-A2
Certificates.
CLASS 4D CERTIFICATES: Collectively, the Class 4D-A1, Class 4D-A2,
Class 4D-A3 and Class 4D-A4 Certificates.
CLOSING DATE: September 30, 1996.
CODE: The Internal Revenue Code of 1986.
COMMISSION: The Securities and Exchange Commission.
CORPORATE TRUST OFFICE: The principal corporate trust office of the
Trustee at which at any particular time its corporate trust business in
connection with this Agreement shall be administered, which office at the date
of the execution of this instrument is located at 000 Xxxx Xxxxx Xxxxxx, Xx.
Xxxx, Xxxxxxxxx 00000, Attention: Salomon Brothers Mortgage Securities VII,
Inc., Series 1996-4, or at such other address as the Trustee may designate from
time to time by notice to the Certificateholders and the Depositor.
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DEPOSITOR: Salomon Brothers Mortgage Securities VII, Inc., a Delaware
corporation, or its successor in interest.
DEPOSITORY: The Depository Trust Company, or any successor Depository
hereafter named. The nominee of the initial Depository for purposes of
registering those Certificates that are to be Book-Entry Certificates, is CEDE &
Co. The Depository shall at all times be a "clearing corporation" as defined in
Section 8-102(3) of the Uniform Commercial Code of the State of New York and a
"clearing agency" registered pursuant to the provisions of Section 17A of the
Securities Exchange Act of 1934, as amended.
DEPOSITORY PARTICIPANT: A broker, dealer, bank or other financial
institution or other Person for whom from time to time a Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
DISTRIBUTION DATE: The second Business Day following each Underlying
Certificate Distribution Date, commencing on October 29, 1996.
DTC: The Depository Trust Company, or any successor depository
hereafter named under this Agreement.
ELIGIBLE ACCOUNT: Any of (i) an account or accounts maintained with a
federal or state chartered depository institution or trust company the
short-term deposits of which are rated A-1 by the Rating Agency at the time any
amounts are held on deposit therein, (ii) an account or accounts the deposits in
which are fully insured by the FDIC or (iii) a trust account or accounts
maintained with the trust department of a federal or state chartered depository
institution or trust company acting in its fiduciary capacity. Eligible Accounts
may bear interest.
ELIGIBLE INVESTMENTS: At any time, any one or more of the following
obligations and securities which shall mature not later than the Business Day
preceding the Distribution Date next succeeding the date of such investment,
provided that such investments continue to qualify as "cash flow investments" as
defined in Code Section 860G(a)(6):
(i) obligations of the United States of America or any agency
thereof, provided such obligations are either (a) backed by the full faith
and credit of the United States of America or (b) issued by an agency with
a long-term debt rating of Aaa by the Rating Agency and the ability to
borrow directly from the U.S. Treasury as mandated by Congress;
(ii) general obligations of or obligations guaranteed by any
state of the United States of America or the District of Columbia
receiving the highest short-term or one of the two highest long-term
ratings of the Rating Agency, or such lower rating as would not result in
the downgrading or withdrawal of the rating then assigned to any of the
Certificates by the Rating Agency or result in any of such rated
Certificates being placed on credit review status (other than for possible
upgrading) by the Rating Agency;
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(iii) commercial or finance company paper which then receives the
highest short-term or one of the two highest long-term commercial or
finance company paper ratings of the Rating Agency, or such lower ratings
as would not result in the downgrading or withdrawal of the rating then
assigned to any of the Certificates by the Rating Agency or result in any
of such rated Certificates being placed on credit review status (other
than for possible upgrading) by the Rating Agency;
(iv) certificates of deposit, demand or time deposits, federal
funds or banker's acceptances issued by any depository institution or
trust company incorporated under the laws of the United States of America
or of any state thereof and subject to supervision and examination by
federal and/or state banking authorities, provided that the commercial
paper and/or debt obligations of such depository institution or trust
company receives the highest short-term or one of the two highest
long-term ratings of the Rating Agency for such securities, or such lower
ratings as would not result in the downgrading or withdrawal of the rating
then assigned to any of the Certificates by the Rating Agency or result in
any of such rated Certificates being placed on credit review status (other
than for possible upgrading) by the Rating Agency;
(v) repurchase agreements on obligations with respect to any
security described in clauses (i) or (ii) above or any other security
issued or guaranteed by an agency or instrumentality of the United States
of America, in either case entered into with a depository institution or
trust company (acting as principal) described in clause (iv) above;
(vi) securities (other than stripped bonds or stripped coupon
securities) bearing interest or sold at a discount issued by any
corporation incorporated under the laws of the United States of America or
any state thereof which, at the time of such investment or contractual
commitment providing for such investment, receive the highest short-term
or one of the two highest long-term ratings by the Rating Agency, or such
lower ratings as would not result in the downgrading or withdrawal of the
rating then assigned to any of the Certificates by the Rating Agency or
result in any of such rated Certificates being placed on credit review
status (other than for possible upgrading) by the Rating Agency;
(vii) units of any money market fund that has the highest fund
rating from the Rating Agency or is otherwise approved in writing by the
Rating Agency;
(viii) mutual funds organized under the Investment Company Act of
1940 rated not less than "AAA" by the Rating Agency; and
(ix) such other investments acceptable to the Rating Agency as
would not result in the downgrading of the rating then assigned to the
Certificates by the Rating Agency or result in any of such rated
Certificates being placed on credit review status (other than for possible
upgrading) by the Rating Agency.
In no event shall an instrument be an Eligible Investment if such
instrument evidences either (i) a right to receive only interest payments with
respect to the obligations underlying such
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instrument, or (ii) both principal and interest payments derived from
obligations underlying such instrument and the interest and principal payments
with respect to such instrument provide a yield to maturity at the date of
investment of greater than 120% of the yield to maturity at par of such
underlying obligations.
ERISA: Employee Retirement Income Security Act of 1974, as amended, and
the rules and regulations promulgated thereunder.
EXTRAORDINARY TRUST FUND EXPENSES: Unanticipated expenses of the Trust
Fund consisting of amounts reimbursable to the Trustee or the Depositor by the
Trust Fund pursuant to the terms of this Trust Agreement, including any
indemnification payments to the Trustee by the Trust Fund pursuant to Section
6.05 and any other unanticipated costs, expenses, liabilities and losses borne
by the Trust Fund for which the Trust Fund has not and, in the reasonable good
faith judgment of the Trustee shall not obtain reimbursement or indemnification
from any other Person.
FHLMC: Federal Home Loan Mortgage Corporation or any successor thereto.
FINAL DISTRIBUTION DATE: The Distribution Date set forth in the notice
delivered by the Trustee of the final distribution on the Certificates pursuant
to Section 7.01.
INDEPENDENT: When used with respect to any specified Person, any such
Person who (a) is in fact independent of the Depositor and its Affiliates, (b)
does not have any direct financial interest in or any material indirect
financial interest in the Depositor or any Affiliate thereof, and (c) is not
connected with the Depositor or any Affiliate thereof as an officer, employee,
promoter, underwriter, trustee, partner, director or Person performing similar
functions; provided, however, that a Person shall not fail to be Independent of
the Depositor or any Affiliate thereof merely because such Person is the
beneficial owner of 1% or less of any class of securities issued by the
Depositor or any Affiliate thereof, as the case may be.
INTEREST ACCRUAL PERIOD: As to any Distribution Date, the one-month
period preceding the month in which such Distribution Date occurs. All
distributions of interest will be based on a 360-day year consisting of twelve
30-day months.
INTEREST DISTRIBUTION AMOUNT: As to any Distribution Date and Class, an
amount equal to (a) the product of (i) one-twelfth of the Pass-Through Rate for
such Class and (ii) the Certificate Principal Balance of such Class less (b)
such Class's pro rata share (as described below) of any interest shortfall
allocated to the Related Underlying Certificates on the applicable Underlying
Certificate Distribution Date and the interest portion of any Realized Losses
allocated to the Related Underlying Certificates on the applicable Underlying
Certificate Distribution Date plus (c) the amount of any interest on such Class
previously accrued and remaining unpaid, but only to the extent that previously
accrued and unpaid interest on the Related Underlying Certificates has been
included in the applicable Underlying Certificate Interest Distribution Amount
on the applicable Underlying Certificate Distribution Date. Interest shortfalls
and the interest portion of Realized Losses on the Underlying Certificates will
be allocated to each
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Related Class pro rata based on the Interest Distribution Amount for such
Related Class before reduction pursuant to clause (b) of the preceding sentence.
OFFICER'S CERTIFICATE: With respect to any Person, a certificate signed
by the Chairman of the Board, the President, or a Vice President, and by the
Treasurer, the Secretary or one of the Assistant Treasurers or Assistant
Secretaries of such Person (or, in the case of a Person which is not a
corporation, signed by the person or persons having like responsibilities).
OPINION OF COUNSEL: A written opinion of counsel, who may, without
limitation, be salaried counsel for the Depositor or the Trustee, except that
any opinion of counsel relating to qualification or compliance of the Trust Fund
as a Grantor Trust must be an opinion of Independent counsel.
OWNERSHIP INTEREST: As to any Certificate, any ownership or security
interest in such Certificate, including any interest in such Certificate as the
Holder thereof and any other interest therein, whether direct or indirect, legal
or beneficial, as owner or as pledgee.
PASS-THROUGH RATE: With respect to the Class 4A Certificates and any
Distribution Date, 6.860% per annum, the Class 4B Certificates and any
Distribution Date, 6.485% per annum, the Class 4C Certificates and any
Distribution Date, 6.485% per annum and the Class 4D Certificates and any
Distribution Date, 6.985% per annum.
PERCENTAGE INTEREST: With respect to any Class of Certificate, the
portion of the respective Class evidenced by such Certificate, expressed as a
percentage, the numerator of which is the initial Certificate Principal Balance
represented by such Certificate, and the denominator of which is the initial
aggregate Certificate Principal Balance of all of the Certificates of such
Class. The Certificates are issuable only in Percentage Interests corresponding
to initial Certificate Principal Balances of $1,000 and integral multiples of $1
in excess thereof, except that one Certificate of each Class may be issued
having a Percentage Interest corresponding to the remainder of the aggregate
initial Certificate Principal Balance of the Certificates of such Class or to an
otherwise authorized denomination for the Certificates of such Class plus such
remainder.
PERSON: Any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
POOLING AND SERVICING AGREEMENT: Any of the following pooling and
servicing agreements pursuant to which the Underlying Certificates were issued:
(i) the Pooling and Servicing Agreement, dated as of February 16, 1994, among
The Prudential Home Mortgage Securities Company, Inc., as seller, The Prudential
Home Mortgage Company, Inc., as servicer, and First Trust National Association,
as trustee; (ii) the Pooling and Servicing Agreement, dated as of March 1, 1994,
among GE Capital Mortgage Services, Inc., as seller and servicer and State
Street Bank and Trust Company, as trustee; (iii) the Pooling and Servicing
Agreement, dated as of December 1, 1993, among CWMBS, Inc., as depositor,
Countrywide Mortgage Conduit,
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Inc., as seller and master servicer and The Bank of New York, as trustee; and
(iv) the Pooling and Servicing Agreement, dated as of September 1, 1993, among
Residential Funding Mortgage Securities I, Inc., as company, Residential Funding
Corporation, as master servicer and The First National Bank of Chicago, as
trustee.
PRINCIPAL DISTRIBUTION AMOUNT: As to any Distribution Date, an amount
equal to all principal distributed on the Underlying Certificates on the related
Underlying Certificate Distribution Date.
RATING AGENCY: Standard & Poor's Ratings Services, or its successors.
If such agency or its successors are no longer in existence, "Rating Agency"
shall be such nationally recognized statistical rating agency, or other
comparable Person, designated by the Depositor, notice of which designation
shall be given to the Trustee.
REALIZED LOSS: Any losses allocated to any of the Underlying
Certificates pursuant to the related Pooling and Servicing Agreement. The
principal portion of Realized Losses means any such losses allocated in
reduction of the principal balance of any of the Underlying Certificates. The
interest portion of Realized Losses means any such losses allocated in reduction
of the amount of interest distributable to any of the Underlying Certificates on
an Underlying Certificate Distribution Date.
RECORD DATE: With respect to each Distribution Date, the close of
business on the last Business Day of the month preceding the month in which such
Distribution Date occurs.
RELATED CLASS: With respect to the Underlying Prudential Certificates,
the Class 4A Certificates shall be referred to herein as the "Related Class" of
Certificates or the "Related Certificates". With respect to the Underlying
GECMSI Certificates, the Class 4B Certificates shall be referred to herein as
the "Related Class" of Certificates or the "Related Certificates". With respect
to the Underlying CWMBS Certificates, the Class 4C Certificates shall be
referred to herein as the "Related Class" of Certificates or the "Related
Certificates". With respect to the Underlying RFMSI Certificates, the Class 4D
Certificates shall be referred to as the "Related Class" of Certificates or the
"Related Certificates".
RELATED UNDERLYING CERTIFICATES: With respect to the Class 4A
Certificates, the Underlying Prudential Certificates shall be referred to herein
as the "Related Underlying Certificates". With respect to the Class 4B
Certificates, the Underlying GECMSI Certificates shall be referred to herein as
the "Related Underlying Certificates". With respect to the Class 4C
Certificates, the Underlying CWMBS Certificates shall be referred to herein as
the "Related Underlying Certificates".With respect to the Class 4D Certificates,
the Underlying RFMSI Certificates shall be referred to herein as the "Related
Underlying Certificates".
RESPONSIBLE OFFICER: When used with respect to the Trustee, the
Chairman or Vice Chairman of the Board of Directors or Trustees, the Chairman or
Vice Chairman of the Executive or Standing Committee of the Board of Directors
or Trustees, the President, the Chairman of the Committee on Trust Matters, any
vice president, any assistant vice president,
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the Secretary, any assistant secretary, the Treasurer, any assistant treasurer,
the Cashier, any assistant cashier, any trust officer or assistant trust
officer, the Controller and any assistant controller or any other officer of the
Trustee customarily performing functions similar to those performed by any of
the above designated officers and, with respect to a particular matter, to whom
such matter is referred because of such officer's knowledge of and familiarity
with the particular subject.
SINGLE CERTIFICATE: A hypothetical Certificate evidencing a Percentage
Interest for the Certificates corresponding to an initial Certificate Principal
Balance of $1,000.
TRANSFER: Any transfer, sale, pledge, hypothecation or other form of
assignment of any Ownership Interest in a Certificate.
TRANSFEREE: Any Person who is acquiring by Transfer any Ownership
Interest in a Certificate.
TRUST: The trust created by this Agreement.
TRUSTEE: First Trust National Association, a national banking
association, or its successor in interest, or any successor trustee appointed as
herein provided.
TRUSTEE FEE: As to any Distribution Date, the amount retained pursuant
to Section 6.05 by the Trustee from aggregate distributions on the Underlying
Certificates as compensation for all services rendered by it in the execution of
the trust hereby created and in the exercise and performance of any of the
powers and duties of the Trustee hereunder, which amount shall equal the product
of (i) one-twelfth of the Trustee Fee Rate and (ii) the aggregate Certificate
Principal Balance of the Certificates immediately prior to such Distribution
Date.
TRUSTEE FEE RATE: 0.015% per annum.
TRUST FUND: The corpus of the Trust consisting of (i) the Underlying
Certificates, (ii) all distributions on the Underlying Certificates payable
after October 25, 1996, and (iii) amounts held from time to time by the Trustee
in the Certificate Account.
UNDERLYING CERTIFICATES: Collectively, the Underlying Prudential
Certificates, the Underlying GECMSI Certificates, the Underlying CWMBS
Certificates and the Underlying RFMSI Certificates, which Underlying
Certificates evidence senior interests in the related trust fund created by the
related Pooling and Servicing Agreement, which are transferred to the Trust by
the Depositor pursuant to this Trust Agreement and which are further identified
in the Underlying Certificate Schedule.
UNDERLYING CERTIFICATE DISTRIBUTION DATE: The 25th day of each month,
or if such 25th day is not a Business Day (as defined in the related Pooling and
Servicing Agreement), the first Business Day following such 25th day.
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UNDERLYING CERTIFICATE DISTRIBUTION DATE STATEMENTS: With respect to
the Underlying Certificates, the reports provided to holders thereof in
connection with each Underlying Certificate Distribution Date pursuant to the
Pooling and Servicing Agreements.
UNDERLYING CERTIFICATE SCHEDULE: The schedule attached as Exhibit B
hereto, such schedule setting forth as to each Underlying Certificate its
principal balance and the principal balance of the related Components on the
Closing Date.
UNDERLYING INTEREST DISTRIBUTION AMOUNT: As to any Distribution Date,
an amount equal to all interest distributions on the Underlying Certificates on
the related Underlying Certificate Distribution Date.
UNDERLYING PRUDENTIAL CERTIFICATES: The Prudential Home Mortgage
Securities Company, Inc., Mortgage Pass-Through Certificates, Series 1994-8,
Class A-5, which Underlying Prudential Certificates represent a 100.00%
percentage interest in such class.
UNDERLYING GECMSI CERTIFICATES: The GE Capital Mortgage Services, Inc.,
REMIC Multi-Class Pass-Through Certificates, Series 1994-11, Class A11, which
Underlying GECMSI Certificates represent a 100.00% percentage interest in such
class.
UNDERLYING CWMBS CERTIFICATES: The CWMBS, Inc., Mortgage Pass-Through
Certificates, Series 1993-5, Class A-8, which Underlying CWMBS Certificates
represent approximately a 96.29% percentage interest in such class.
UNDERLYING RFMSI CERTIFICATES: The Residential Funding Mortgage
Securities I, Inc., Mortgage Pass-Through Certificates, Series 1993-S34, Class
A-4, which Underlying RFMSI Certificates represent approximately a 100.00%
percentage interest in such class.
VOTING RIGHTS: The portion of the voting rights of all of the
Certificates which is allocated to any Certificate. All Voting Rights allocated
to the Certificates shall be allocated among such Certificates PRO RATA in
accordance with the respective Percentage Interests evidenced thereby.
Section 1.02. INTEREST CALCULATION.
Interest in respect of the Certificates shall be calculated on the
basis of a 360-day year consisting of twelve 30-day months.
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ARTICLE II
CONVEYANCE OF THE UNDERLYING CERTIFICATES
AND THE ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.01. CONVEYANCE OF THE UNDERLYING CERTIFICATES. The Depositor,
concurrently with the execution and delivery hereof, does hereby transfer,
convey, sell and assign to the Trustee, on behalf of the Holders of the
Certificates, without recourse except as set forth in the last sentence of this
Section 2.01, all the right, title and interest of the Depositor in and to the
Underlying Certificates, including all distributions thereon payable after
October 25, 1996. In connection with such assignment, the Depositor shall have
caused the Underlying Certificates to be registered in the book-entry records of
DTC in the name of the Trustee and evidence of such registration to be delivered
to the Trustee. The Depositor represents and warrants to the Trustee that
immediately prior to such transfer by the Depositor of the Underlying
Certificates to the Trustee, the Depositor was the sole owner of the Underlying
Certificates and had full right and authority to sell, assign and transfer the
Underlying Certificates.
The transfer of the Underlying Certificates and all other assets
constituting the Trust Fund is absolute and is intended by the parties hereto as
a sale. Except as provided in Section 3.05(b) hereof, the Trustee shall at all
times maintain possession of the Underlying Certificates through DTC and shall
not assign, sell, dispose of or transfer any interest in the Underlying
Certificates or any other asset constituting the Trust Fund or permit the
Underlying Certificates or any other asset constituting the Trust Fund to be
subjected to any lien, claim or encumbrance arising by, through or under the
Trustee or any person claiming by, through or under the Trustee.
Section 2.02. ISSUANCE OF CERTIFICATES. The Trustee acknowledges the
transfer and delivery to it of the Underlying Certificates in the manner
described in Section 2.01 hereof, and concurrently with such delivery, has
caused to be duly executed, authenticated and delivered to or upon the order of
the Depositor, in exchange for the Underlying Certificates together with all
other assets included or to be included in the Trust Fund, receipt of which is
hereby acknowledged, Certificates in authorized denominations which evidence
ownership of the entire Trust Fund. The Trustee declares that it holds and will
hold such Underlying Certificates and any proceeds thereof in trust for the
exclusive use and benefit of all present and future Certificateholders.
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ARTICLE III
ADMINISTRATION OF THE UNDERLYING CERTIFICATES
Section 3.01. COLLECTION OF PAYMENTS ON THE UNDERLYING CERTIFICATES;
CERTIFICATE ACCOUNT. (a) The Trustee shall establish and maintain with itself a
trust account (the "Certificate Account") entitled "Salomon Brothers Mortgage
Securities VII, Inc., Trust Certificates, Series 1996-4, Certificate Account",
in which the Trustee shall, subject to the terms of this paragraph, deposit each
distribution received by the Trustee with respect to the Underlying Certificates
on the day of receipt. If the Trustee shall not have received a distribution
with respect to the Underlying Certificates on the Underlying Certificate
Distribution Date, the Trustee shall request such payment as promptly as
possible and shall, subject to the second to last sentence of this paragraph,
take such legal action as the Trustee shall deem appropriate under the
circumstances, including the prosecution of any claims in connection therewith.
The reasonable legal fees and expenses incurred by the Trustee in connection
with the prosecution of any such legal action shall be reimbursable to the
Trustee out of the proceeds of any such action and shall be retained by the
Trustee prior to the deposit of any remaining proceeds in the Certificate
Account pending distribution thereof to Certificateholders in accordance with
Section 3.02 hereof. In the event that the Trustee has reason to believe that
the proceeds of any such legal action may be insufficient to reimburse it for
its projected legal fees and expenses, the Trustee shall notify the
Certificateholders that it is not obligated to pursue any such available
remedies unless adequate indemnity for its legal fees and expenses is provided
by Certificateholders. In the event any such adequate indemnity is provided to
the Trustee, the Trustee shall take such action as shall be appropriate under
the circumstances.
(b) In the event that any Distribution Date occurs on a date later than
the related Underlying Certificate Distribution Date, the Trustee may invest the
funds deposited in the Certificate Account and shall receive as compensation, in
addition to the Trustee Fee, any interest or investment income earned on funds
deposited in the Certificate Account. Notwithstanding the foregoing, during the
period from such Underlying Certificate Distribution Date to such related
Distribution Date, any investment of any amount on deposit in the Certificate
Account must be an Eligible Investment, no such investment of any amount on
deposit in the Certificate Account may mature later than the Business Day
preceding such related Distribution Date and no such investment shall be sold
prior to its maturity date. On each Distribution Date the Trustee shall withdraw
any net reinvestment income on deposit in the Certificate Account and retain
such amount as additional compensation. The amount of any losses incurred in
respect of any such investments shall be deposited in the Certificate Account by
the Trustee out of its own funds immediately as realized.
(c) The Trustee may from time to time withdraw funds from the
Certificate Account for the following purposes:
(i) to make distributions in the amounts and in the manner
provided for in Section 3.02;
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(ii) to pay itself on each Distribution Date the Trustee Fee
and any investment income on amounts in the Certificate Account;
(iii) to pay any Extraordinary Trust Fund Expenses; and
(iv) to clear and terminate the Certificate Account upon the
termination of this Agreement.
Section 3.02. DISTRIBUTIONS. (a) On each Distribution Date, the Trustee
shall, to the extent of Available Funds on deposit in the Certificate Account,
distribute to the Certificateholders the Available Funds, subject to 6.14 below,
in the following manner:
FIRST, to the extent of the Underlying Interest Distribution Amount, to
distributions of interest in respect of the Certificates, in an amount
equal to the aggregate of the Interest Distribution Amounts in respect of
such Certificates for such Distribution Date, in each case as provided in
Section 3.02(b) below; and
SECOND, to the extent of the Principal Distribution Amount, to
distributions of principal to the Certificates (applied to reduce the
Certificate Principal Balance of such Certificates) in the manner set
forth in Section 3.02(c).
In addition, to the extent that the amount of any Realized Losses
previously allocated to any Underlying Certificates are at a later date paid on
such Underlying Certificates, such amounts (to the extent not paid on the Trust
Certificates pursuant to clause FIRST or clause SECOND above) will be paid to
the Related Classes of Trust Certificates in the same manner as principal is
paid such Related Classes pursuant to Section 3.02(b).
(b) On each Distribution Date, the aggregate distributions of interest
and principal made on such date in respect of the Certificates pursuant to
Section 3.02(a) above shall be applied among the various Classes thereof in the
following manner:
1) Amounts received in respect of the Underlying Prudential Certificates
shall be applied solely to the Class 4A Certificates. Interest received
shall be applied pro rata based on the respective Interest Distribution
Amounts of the Class 4A Certificates and principal received shall be
applied as follows:
(I) All amounts paid in respect of principal on the Underlying
Prudential Certificates "PAC I Component" shall be applied as
principal payments on the Class 4A-A1 Certificates; and
(II) All amounts paid in respect of principal on the Underlying
Prudential Certificates "PAC II Component" shall be applied
as principal payments on the Class 4A-A2 Certificates.
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2) Amounts received in respect of the Underlying GECMSI Certificates shall
be applied solely to the Class 4B Certificates. Interest received shall
be applied pro rata based on the respective Interest Distribution
Amounts of the Class 4B Certificates and principal received shall be
applied as follows:
(I) All amounts paid in respect of principal on the Underlying
GECMSI Certificates "Class A11A PAC Component" shall be
applied as principal payments on the Class 4B-A1
Certificates;
(II) All amounts paid in respect of principal on the Underlying
GECMSI Certificates "Class A11B PAC Component" shall be
applied as principal payments on the Class 4B-A2
Certificates; and
(III) All amounts paid in respect of principal on the Underlying
GECMSI Certificates "Class A11C PAC Component" shall be
applied as principal payments on the Class 4B-A3
Certificates.
3) Amounts received in respect of the Underlying CWMBS Certificates shall
be applied solely to the Class 4C Certificates. Interest received shall
be applied pro rata based on the respective Interest Distribution
Amounts of the Class 4C Certificates and principal received shall be
applied as follows:
(I) All amounts paid in respect of principal on the Underlying
CWMBS Certificates "Class A-B-1 Component" shall be applied
as principal payments on the Class 4C-A1 Certificates; and
(II) All amounts paid in respect of principal on the Underlying
CWMBS Certificates "Class A-B-2 Component" shall be applied
as principal payments on the Class 4C-A2 Certificates.
4) Amounts received in respect of the Underlying RFMSI Certificates shall
be applied solely to the Class 4D Certificates. Interest received shall
be applied pro rata based on the respective Interest Distribution
Amounts of the Class 4D Certificates and principal received shall be
applied as follows:
(I) All amounts paid in respect of principal on the Underlying
RFMSI Certificates "PAC Principal Component" shall be applied
as principal payments on the Class 4D-A1 Certificates;
(II) All amounts paid in respect of principal on the Underlying
RFMSI Certificates "SAC Principal Component" shall be applied
as principal payments on the Class 4D-A2 Certificates;
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(III) All amounts paid in respect of principal on the Underlying
RFMSI Certificates "TAC Principal Component 1" shall be
applied as principal payments on the Class 4D-A3
Certificates; and
(IV) All amounts paid in respect of principal on the Underlying
RFMSI Certificates "TAC Principal Component 2" shall be
applied as principal payments on the Class 4D-A4
Certificates.
(c) All distributions made with respect to each Class of Certificates
on each Distribution Date shall be allocated PRO RATA among the outstanding
Certificates in such Class based on their respective Percentage Interests.
Payments in respect of each Class of Certificates on each Distribution Date will
be made to the Holders of record on the related Record Date (except as otherwise
provided in the last sentence of this Section 3.02(c) or in Section 7.01
respecting the final distribution on such Class), based on the aggregate
Percentage Interest represented by their respective Certificates, and shall be
made by wire transfer of immediately available funds to the account of any such
Holder at a bank or other entity having appropriate facilities therefor, if such
Holder shall have so notified the Trustee in writing at least five Business Days
prior to the Record Date immediately prior to such Distribution Date and is the
registered owner of Certificates having an initial aggregate Certificate
Principal Balance that is in excess of $5,000,000, or otherwise by check mailed
by first class mail to the address of such Holder appearing in the Certificate
Register. The final distribution on each Certificate will be made in like
manner, but only upon presentment and surrender of such Certificate at the
Corporate Trust Office or such other location specified in the notice to
Certificateholders of such final distribution.
Each distribution with respect to a Book-Entry Certificate shall be
paid to the Depository, as Holder thereof, and the Depository shall be
responsible for crediting the amount of such distribution to the accounts of its
Depository Participants in accordance with its normal procedures. Each
Depository Participant shall be responsible for disbursing such distribution to
the Certificate Owners that it represents and to each indirect participating
brokerage firm (a "brokerage firm" or "indirect participating firm") for which
it acts as agent. Each brokerage firm shall be responsible for disbursing funds
to the Certificate Owners that it represents. None of the Trustee, the
Certificate Registrar or the Depositor shall have any responsibility therefor
except as otherwise provided by this Agreement or applicable law.
(d) The rights of the Certificateholders to receive distributions in
respect of the Certificates, and all interests of the Certificateholders in such
distributions, shall be as set forth in this Agreement. Neither the Holders of
the Certificates nor the Trustee shall in any way be responsible or liable to
the Holders of any other Certificates in respect of amounts properly previously
distributed on the Certificates.
Section 3.03. STATEMENTS TO CERTIFICATEHOLDERS. On the Business Day
prior to each Distribution Date, the Trustee shall prepare, and on each such
Distribution Date forward by mail to each Holder of the Certificates, (A) a copy
of the Underlying Certificate Distribution Date Statements required under each
Pooling and Servicing Agreement to be sent to holders of the
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related Underlying Certificates and (B) a statement as to the distributions on
the Certificates made on such Distribution Date setting forth:
(i) the amount of the distribution made on such
Distribution Date to the Holders of the Certificates of each such Class
allocable to principal;
(ii) the amount of the distribution made on such
Distribution Date to the Holders of the Certificates of each Class
allocable to interest;
(iii) the aggregate amount of the Trustee Fee for such
Distribution Date and such other customary information as the Trustee
deems necessary or desirable, or which a Certificateholder reasonably
requests, to enable Certificateholders to prepare their tax returns;
(iv) the aggregate Certificate Principal Balance of the
Certificates, after giving effect to the distributions and allocations
of Extraordinary Trust Fund Expenses and Realized Losses made on such
Distribution Date, separately identifying any reduction thereof due to
allocations of Extraordinary Trust Fund Expenses and Realized Losses;
(v) the Certificate Factor for the Certificates
applicable to such Distribution Date; and
(vi) the Interest Distribution Amount in respect of the
Certificates for such Distribution Date (separately identifying any
reductions resulting from, the allocation of Interest Shortfalls and
the allocation of the interest portion of Realized Losses on such
Distribution Date) and the respective portions thereof, if any,
remaining unpaid following the distributions made in respect of such
Certificates on such Distribution Date.
provided that the information furnished pursuant to clauses (A) and (B) above
shall, in addition to being forwarded by mail, be sent by telecopy to any Holder
of any Certificates who has notified the Trustee that it wishes to receive such
information on each Distribution Date by telecopy.
In the case of information furnished pursuant to subclauses (i)-(iii)
above, the amounts shall be expressed as a dollar amount per Single Certificate
of the relevant Class.
Within a reasonable period of time after the end of each calendar year,
the Trustee shall furnish to each Person who at any time during the calendar
year was a Holder of a Certificate a statement containing the information set
forth in subclauses (i)-(iii) above, aggregated for such calendar year or
applicable portion thereof during which such person was a Certificateholder.
Such obligation of the Trustee shall be deemed to have been satisfied to the
extent that substantially comparable information shall be provided by the
Trustee pursuant to any requirements of the Code as from time to time are in
force.
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The Trustee shall, upon request, furnish to each Certificateholder
during the term of this Agreement, such periodic, special, or other reports or
information, whether or not provided for herein, as shall be reasonable with
respect to the Certificateholder, or otherwise with respect to the purposes of
this Agreement, all such reports or information to be provided in accordance
with such reasonable and explicit instructions and directions as the
Certificateholder may provide, including without limitation such information as
may reasonably be requested from time to time by a Certificateholder in order to
prepare its tax returns. For purposes of this Section 3.03, the Trustee's duties
are limited to the extent that the Trustee receives timely reports as required
from the trustee under each of the Pooling and Servicing Agreements.
Section 3.04. ALLOCATION OF EXTRAORDINARY TRUST FUND EXPENSES AND
REALIZED LOSSES. With respect to each Distribution Date, all Extraordinary Trust
Fund Expenses shall be allocated in reduction of the Certificate Principal
Balances of each Class of Certificates on a pro rata basis based on principal
otherwise payable on such Class pursuant to Section 3.02 in relation to the
Principal Distribution Amount.
With respect to each Distribution Date, all Realized Losses incurred on
any Underlying Certificate shall be allocated to the Related Class of
Certificates. All Realized Losses allocated shall be borne by the
Certificateholders of the Related Class on a pro rata basis based on current
interest or current principal entitlements, as applicable.
All Realized Losses and Extraordinary Trust Fund Expenses allocated to
a Class of Certificates hereunder will be allocated among the Certificates of
such Class in proportion to the Percentage Interests evidenced thereby.
Section 3.05. NOTICES TO TRUSTEE. (a) Upon receipt of any notice or
statement with respect to the Underlying Certificates, the Trustee shall not
take any action except in accordance with written instructions from the
Certificateholders pursuant to the third paragraph of Section 8.02.
(b) Upon receipt of notice of the final distribution on any class of
the Underlying Certificates, the Trustee shall surrender such Underlying
Certificates to the trustee for such Underlying Certificates for payment of the
final distribution thereon.
Section 3.06. EXCHANGE COMMISSION; ADDITIONAL INFORMATION. The Trustee
shall prepare or cause to be prepared for filing with the Commission (other than
the Current Report on Form 8-K to be filed by the Company in connection with
computational materials and the initial Current Report on Form 8-K to be filed
by the Company in connection with the issuance of the Certificates) any and all
reports, statements and information respecting the Trust Fund and/or the
Certificates required to be filed, and shall solicit any and all proxies of the
Certificateholders whenever such proxies are required to be solicited, pursuant
to the Securities Exchange Act of 1934, as amended. The Company shall promptly
file, and exercise its reasonable best efforts to obtain a favorable response
to, no-action requests with, or other appropriate exemptive relief from, the
Commission seeking the usual and customary exemption from such reporting
requirements granted to issuers of securities similar to the Certificates. Fees
and expenses
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incurred by the Trustee in connection with the foregoing shall be reimbursed
pursuant to Section 6.05 and shall not be paid by the Trust Fund.
The Company agrees to promptly furnish to the Trustee, from time to
time upon request, such further information, reports and financial statements
within their control related to this Agreement and the Mortgage Loans as the
Trustee reasonably deems appropriate to prepare and file all necessary reports
with the Commission.
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ARTICLE IV
THE CERTIFICATES
Section 4.01. THE CERTIFICATES. (a) The Certificates in the aggregate
will represent the entire beneficial ownership interest in the Underlying
Certificates and all other assets included in the Trust Fund. At the Closing
Date, the aggregate Certificate Principal Balance of the Certificates will equal
the aggregate principal balance of the Underlying Certificates. The aggregate
Certificate Principal Balance of all Certificates as of the Closing Date shall
equal the initial Certificate Principal Balance.
The Certificates will be substantially in the form annexed hereto as
Exhibit A. The Certificates will be issuable in registered form only, in
denominations of authorized Percentage Interests as described in the definition
thereof. Each Certificate will share ratably in all rights of the Certificates
in the aggregate.
Upon original issue, the Certificates shall be executed and delivered
by the Trustee and the Trustee shall cause the Certificates to be authenticated
by the Certificate Registrar to or upon the order of the Depositor. The
Certificates shall be executed and attested by manual or facsimile signature on
behalf of the Trustee by an authorized signatory. Certificates bearing the
manual or facsimile signatures of individuals who were at any time the proper
officers of the Trustee shall bind the Trustee, notwithstanding that such
individuals or any of them have ceased to hold such offices prior to the
authentication and delivery of such Certificates or did not hold such offices at
the date of such Certificates. No Certificate shall be entitled to any benefit
under this Trust Agreement or be valid for any purpose, unless there appears on
such Certificate a certificate of authentication substantially in the form
provided herein executed by the Certificate Registrar by manual signature, and
such certificate of authentication shall be conclusive evidence, and the only
evidence, that such Certificate has been duly authenticated and delivered
hereunder. All Certificates shall be dated the date of their authentication.
(b) The Certificates shall initially be issued as one or more
Certificates registered in the name of the Depository or its nominee and, except
as provided below, registration of such Certificates may not be transferred by
the Trustee except to another Depository that agrees to hold such Certificates
for the respective Certificate Owners with Ownership Interests therein. The
Certificate Owners shall hold their respective Ownership Interests in and to
such Certificates through the book-entry facilities of the Depository and,
except as provided below, shall not be entitled to definitive, fully registered
Certificates ("Definitive Certificates") in respect of such Ownership Interests.
All transfers by Certificate Owners of their respective Ownership Interests in
the Book-Entry Certificates shall be made in accordance with the procedures
established by the Depository Participant or brokerage firm representing such
Certificate Owner. Each Depository Participant shall only transfer the Ownership
Interests in the 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.
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The Trustee and the Depositor may for all purposes (including the
making of payments due on the respective Classes of Book-Entry Certificates)
deal with the Depository as the authorized representative of the Certificate
Owners with respect to the respective Classes of Book-Entry Certificates for the
purposes of exercising the rights of Certificateholders hereunder. The rights of
Certificate Owners with respect to the respective Classes of Book-Entry
Certificates shall be limited to those established by law and agreements between
such Certificate Owners and the Depository Participants and brokerage firms
representing such Certificate Owners. Multiple requests and directions from, and
votes of, the Depository as Holder of any Class of Book-Entry Certificates with
respect to any particular matter shall not be deemed inconsistent if they are
made with respect to different Certificate Owners. The Trustee may establish a
reasonable record date in connection with solicitations of consents from or
voting by Certificateholders and shall give notice to the Depository of such
record date.
If (i)(A) the Depositor advises the Trustee in writing that the
Depository is no longer willing or able to properly discharge its
responsibilities as Depository, and (B) the Depositor is unable to locate a
qualified successor, or (ii) the Depositor at its option advises the Trustee in
writing that it elects to terminate the book-entry system through the
Depository, Certificate Owners representing in the aggregate not less than 51%
of the Ownership Interests of each of the Classes of the Book-Entry Certificates
advise the Trustee through the Depository, in writing, that the continuation of
a book-entry system through the Depository is no longer in the best interests of
the Certificate Owners, the Trustee shall notify all Certificate Owners, through
the Depository, of the occurrence of any such event and of the availability of
Definitive Certificates to Certificate Owners requesting the same. Upon
surrender to the Trustee of the Book-Entry Certificates by the Depository,
accompanied by registration instructions from the Depository for registration of
transfer, the Trustee shall issue the Definitive Certificates. Such Definitive
Certificates will be issued in minimum denominations of $1,000, except that any
beneficial ownership that was represented by a Book-Entry Certificate in an
amount less than $1,000 immediately prior to the issuance of a Definitive
Certificate shall be issued in a minimum denomination equal to the amount
represented by such Book-Entry Certificate. Neither the Depositor nor the
Trustee shall be liable for any delay in the delivery of such instructions and
may conclusively rely on, and shall be protected in relying on, such
instructions. Upon the issuance of Definitive Certificates all references herein
to obligations imposed upon or to be performed by the Depository shall be deemed
to be imposed upon and performed by the Trustee, to the extent applicable with
respect to such Definitive Certificates, and the Trustee shall recognize the
Holders of the Definitive Certificates as Certificateholders hereunder.
Section 4.02. REGISTRATION OF AND LIMITATIONS ON TRANSFER AND EXCHANGE
OF CERTIFICATES. The Trustee shall cause to be kept at one of the offices or
agencies to be appointed by the Trustee in accordance with the provisions of
Section 6.10 a Certificate Register for the Certificates in which, subject to
such reasonable regulations as it may prescribe, the Trustee shall provide for
the registration of Certificates and of transfers and exchanges of Certificates
as herein provided. The Trustee will initially serve as Certificate Registrar
for the purpose of registering Certificates and transfers and exchanges of
Certificates as herein provided. The Certificate Registrar may appoint, by a
written instrument delivered to the Depositor, any other bank or trust company
to act as Certificate Registrar under such conditions as the predecessor
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Certificate Registrar may prescribe, provided that the predecessor Certificate
Registrar shall not be relieved of any of its duties or responsibilities
hereunder by reason of such appointment. If the Trustee shall at any time not be
the Certificate Registrar, the Trustee shall have and maintain the right to
inspect the Certificate Register or to obtain a copy thereof at all reasonable
times, and to rely conclusively upon a certificate of the Certificate Registrar
as to the information set forth in the Certificate Register.
Section 4.03. MUTILATED, DESTROYED, LOST OR STOLEN CERTIFICATES. If (i)
any mutilated Certificate is surrendered to the Trustee or the Certificate
Registrar, or the Trustee and the Certificate Registrar receive evidence to
their satisfaction of the destruction, loss or theft of any Certificate, and
(ii) there is delivered to the Trustee and the Certificate Registrar such
security or indemnity as may be required by them to save each of them harmless,
then, in the absence of actual knowledge by the Trustee or the Certificate
Registrar that such Certificate has been acquired by a bona fide purchaser, the
Trustee shall execute and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Certificate, a new Certificate of the same
Class and of like denomination and Percentage Interest. Upon the issuance of any
new Certificate under this Section, the Trustee may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto and any other expenses (including the fees and expenses of the
Certificate Registrar) connected therewith. Any replacement Certificate issued
pursuant to this Section shall constitute complete and indefeasible evidence of
ownership in the Trust Fund created hereunder, as if originally issued, whether
or not the lost, stolen or destroyed Certificate shall be found at any time.
Section 4.04. PERSONS DEEMED OWNERS. Subject to Section 4.02, prior to
due presentation of a Certificate for registration of transfer, the Trustee and
any agent of 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 3.02 and at any other time for all other
purposes whatsoever, and neither the Trustee, the Certificate Registrar nor any
agent of the Trustee or the Certificate Registrar shall be affected by notice to
the contrary.
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ARTICLE V
THE DEPOSITOR
Section 5.01. LIABILITY OF THE DEPOSITOR. The Depositor shall be liable
in accordance herewith only to the extent of the obligations specifically
imposed by this Agreement and undertaken hereunder by the Depositor.
Section 5.02. MERGER OR CONSOLIDATION OF THE DEPOSITOR. Subject to the
following paragraph, the Depositor will keep in full effect its existence,
rights and franchises as a corporation under the laws of the jurisdiction of its
incorporation. The Depositor 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 or the Certificates and to perform its duties
under this Agreement.
The Depositor may be merged or consolidated with or into any Person, or
transfer all or substantially all of its assets to any Person, in which case any
Person resulting from any merger or consolidation to which the Depositor shall
be a party, or any Person succeeding to the business of the Depositor, shall be
the successor of the Depositor hereunder without the execution or filing of any
paper or any further act on the part of any of the parties hereto, anything
herein to the contrary notwithstanding; provided, however, that the Rating
Agency's ratings of the Certificates in effect immediately prior to such merger
or consolidation will not be qualified, reduced or withdrawn as a result thereof
(as evidenced by a letter to such effect from the Rating Agency).
Section 5.03. LIMITATION ON LIABILITY OF THE DEPOSITOR AND OTHERS. None
of the Depositor or any of the directors, officers, employees or agents of the
Depositor shall be under any liability to the Trust Fund or the
Certificateholders for any action taken or for refraining from the taking of any
action in good faith pursuant to this Agreement, or for errors in judgment;
provided, however, that this provision shall not protect the Depositor or any
such person against any breach of warranties, representations or covenants made
herein or against any liability which would otherwise be imposed by reason of
willful misfeasance, bad faith or gross negligence in the performance of duties
or by reason of reckless disregard of obligations and duties hereunder. The
Depositor and any director, officer, employee or agent of the Depositor may rely
in good faith on any document of any kind which, PRIMA FACIE, is properly
executed and submitted by any Person respecting any matters arising hereunder.
The Depositor and any director, officer, employee or agent of the Depositor
shall be indemnified and held harmless by the Trust Fund against any loss,
liability or expense incurred in connection with any legal action relating to
this Agreement or the Certificates (except as any such loss, liability or
expense shall be otherwise reimbursable pursuant to this Agreement), other than
any loss, liability or expense incurred by reason of willful misfeasance, bad
faith or gross negligence in the performance of duties hereunder or by reason of
reckless disregard of obligations and duties hereunder. The Depositor shall not
be under any obligation to appear in, prosecute or defend any legal action
unless such action is related to its respective duties under this Agreement and,
in its opinion, does not involve it in any expense or liability; provided,
however, that the Depositor may in its
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discretion undertake any such action which it may deem necessary or desirable
with respect to this Agreement and the rights and duties of the parties hereto
and the interests of the Certificateholders hereunder. In such event, the legal
expenses and costs of such action and any liability resulting therefrom (except
any loss, liability or expense incurred by reason of willful misfeasance, bad
faith or gross negligence in the performance of duties hereunder or by reason of
reckless disregard of obligations and duties hereunder) shall be expenses, costs
and liabilities of the Trust Fund, and the Depositor shall be entitled to be
reimbursed therefor from the Certificate Account, any such right of
reimbursement being prior to the rights of the Certificateholders to receive any
portion of the amounts from which such cost, expense or liability is
reimbursable.
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ARTICLE VI
THE TRUSTEE
Section 6.01. DUTIES OF TRUSTEE. The Trustee undertakes to perform such
duties and only such duties as are specifically set forth in this Agreement. Any
permissive right of the Trustee enumerated in this Agreement shall not be
construed as a duty.
The Trustee, upon receipt of all resolutions, certificates, statements,
opinions, reports, documents, orders or other instruments furnished to the
Trustee which are specifically required to be furnished pursuant to any
provision of this Agreement, shall examine them to determine whether they
conform to the requirements of this Agreement. If any such instrument is found
not to conform to the requirements of this Agreement in a material manner, the
Trustee shall take such action as it deems appropriate to have the instrument
corrected, and if the instrument is not corrected to the Trustee's satisfaction,
the Trustee will provide notice thereof to the Certificateholders.
No provision of this Agreement shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own misconduct; provided, however, that:
(i) The duties and obligations of the Trustee shall be
determined solely by the express provisions of this Agreement, the
Trustee shall not be liable except for the performance of such duties
and obligations as are specifically set forth in this Agreement, no
implied covenants or obligations shall be read into this Agreement
against the Trustee and, in the absence of bad faith on the part of the
Trustee, the Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein, upon
any certificates or opinions furnished to the Trustee that conform to
the requirements of this Agreement;
(ii) The Trustee shall not be personally liable for an error of
judgment made in good faith by a Responsible Officer or Responsible
Officers of the Trustee, unless it shall be proved that the Trustee was
negligent in ascertaining the pertinent facts;
(iii) The Trustee shall not be personally liable with respect to
any action taken, suffered or omitted to be taken by it in good faith
in accordance with the direction of Holders of Certificates entitled to
at least 25% of the Voting Rights relating to the time, method and
place of conducting any proceeding for any remedy available to the
Trustee, or exercising any trust or power conferred upon the Trustee,
under this Agreement;
(iv) Except to the extent provided herein, no provision in this
Agreement shall require the Trustee to expend or risk its own funds or
otherwise incur any personal financial liability in the performance of
any of its duties as Trustee hereunder, or in the exercise of any of
its rights or powers, if the Trustee shall have reasonable grounds for
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believing that repayment of funds or adequate indemnity against such
risk or liability is not reasonably assured to it; and
(v) In exercising any right or power as holder of the
Underlying Certificates, the Trustee may request the direction of all
Certificateholders and shall be fully protected in acting in accordance
with the written directions of a majority of the Certificateholders
with 51% or more of the Voting Rights of each affected Class.
Section 6.02. CERTAIN MATTERS AFFECTING THE TRUSTEE.
(a) Except as otherwise provided in Section 6.01:
(i) The Trustee may request and rely upon and shall be
protected in acting or refraining from acting upon any resolution,
Officer's Certificate, certificate of auditors or any other
certificate, statement, instrument, opinion, report, notice, request,
consent, order, appraisal, bond or other paper or document reasonably
believed by it to be genuine and to have been signed or presented by
the proper party or parties;
(ii) The Trustee may consult with counsel and any Opinion of
Counsel shall be full and complete authorization and protection in
respect of any action taken or suffered or omitted by it hereunder in
good faith and in accordance with such Opinion of Counsel;
(iii) The Trustee shall be under no obligation to exercise any of
the trusts or powers vested in it by this Agreement or to institute,
conduct or defend any litigation hereunder or in relation hereto at the
request, order or direction of 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;
(iv) The Trustee shall not be personally liable for any action
taken, suffered or omitted by it in good faith and believed by it to be
authorized or within the discretion or rights or powers conferred upon
it by this Agreement;
(v) The Trustee shall not 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 entitled to at least 25% of
the Voting Rights; provided, however, that if the payment within a
reasonable time to the Trustee of the costs, expenses or liabilities
likely to be incurred by it in the making of such investigation is, in
the opinion of the Trustee, not reasonably assured to the Trustee by
such Certificateholders, the Trustee may require reasonable indemnity
against such expense, or liability from such Certificateholders as a
condition to taking any such action; and
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(vi) The Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents or attorneys.
(b) All rights of action under this Agreement or under any of the
Certificates, enforceable by the Trustee, may be enforced by it without the
possession of any of the Certificates, or the production thereof at the trial or
other proceeding relating thereto, and any such suit, action or proceeding
instituted by the Trustee shall be brought in its name for the benefit of all
the Holders of such Certificates, subject to the provisions of this Agreement.
Section 6.03. TRUSTEE NOT LIABLE FOR CERTIFICATES. The recitals
contained herein and in the Certificates (other than the signature of the
Trustee, the authentication of the Certificate Registrar on the Certificates,
the acknowledgments of the Trustee contained in Article II and the
representations and warranties of the Trustee in Section 6.11) shall be taken as
the statements of the Depositor and the Trustee assumes no responsibility for
their correctness. The Trustee makes no representations or warranties as to the
validity or sufficiency of this Agreement (other than as specifically set forth
in Section 6.11) or of the Certificates (other than the signature of the Trustee
and authentication of the Certificate Registrar on the Certificates). The
Trustee shall not be accountable for the use or application by the Depositor of
any of the Certificates or of the proceeds of such Certificates, or for the use
or application of any funds, other than any funds held by or on behalf of the
Trustee in accordance with Section 3.01.
Section 6.04. TRUSTEE MAY OWN CERTIFICATES. The Trustee in its
individual capacity or any other capacity may become the owner or pledgee of
Certificates with the same rights it would have if it were not Trustee.
Section 6.05. TRUSTEE'S FEES AND EXPENSES. As provided in Section
3.01(c), the Trustee shall withdraw from the Certificate Account on each
Distribution Date and pay to itself the Trustee Fee. The Trustee and any
director, officer, employee or agent of the Trustee shall be indemnified (to the
extent the Trustee has not been indemnified under any Pooling and Servicing
Agreement) by the Trust Fund and held harmless against any loss, liability or
expense incurred in connection with any claim or legal action or any pending or
threatened claim or legal action relating to this Agreement or the Certificates,
or any claim or legal action or any pending or threatened claim or legal action
relating to the performance of any of the Trustee's duties hereunder, other than
any loss, liability or expense (i) that constitutes a specific liability of the
Trustee under this Agreement or (ii) incurred by reason of willful misfeasance,
bad faith or negligence in the performance of the Trustee's duties under this
Agreement or as a result of a breach of, or by reason of reckless disregard of,
the Trustee's obligations and duties under this Agreement. Such indemnities
shall survive the termination or discharge of this Agreement and the resignation
or removal of the Trustee. Any payment made hereunder by the Depositor to the
Trustee shall be from the Depositor's own funds, without reimbursement from the
Trust Fund therefor.
Section 6.06. ELIGIBILITY REQUIREMENTS FOR TRUSTEE. The Trustee
hereunder shall at all times be a corporation or an association (other than the
Depositor, Salomon Brothers Inc, or any Affiliate of the foregoing) organized
and doing business under the laws of any state or the
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Xxxxxx Xxxxxx xx Xxxxxxx, authorized under such laws to exercise corporate trust
powers, having a combined capital and surplus of at least $50,000,000, or shall
be a member of a bank holding system, the aggregate combined capital and surplus
of which is at least $50,000,000, and subject to supervision or examination by
federal or state authority. If such corporation or association publishes reports
of conditions at least annually, pursuant to law or to the requirements of the
aforesaid supervising or examining authority, then for the purposes of this
Section the combined capital and surplus of such corporation or association
shall be deemed to be its combined capital and surplus as set forth in its most
recent report of conditions so published. In case at any time the Trustee shall
cease to be eligible in accordance with the provisions of this Section, the
Trustee shall resign immediately in the manner and with the effect specified in
Section 6.07.
Section 6.07. RESIGNATION AND REMOVAL OF THE TRUSTEE. The Trustee may
at any time resign and be discharged from the trusts hereby created by giving
written notice thereof to the Depositor and to all Certificateholders. Upon
receiving such notice of resignation, the Depositor shall promptly appoint a
successor trustee by written instrument, in duplicate, which instrument shall be
delivered to the resigning Trustee and to the successor trustee. A copy of such
instrument shall be delivered to the Certificateholders by the Depositor. If no
successor trustee shall have been so appointed and have accepted appointment
within 30 days after the giving of such notice of resignation, the resigning
Trustee may petition any court of competent jurisdiction for the appointment of
a successor trustee.
If at any time the Trustee shall cease to be eligible in accordance
with the provisions of Section 6.06 and shall fail to resign after written
request therefor by the Depositor, or if at any time the Trustee shall become
incapable of acting, or shall be adjudged bankrupt or insolvent, or a receiver
of the Trustee or of its property shall be appointed, or any public officer
shall take charge or control of the Trustee or of its property or affairs for
the purpose of rehabilitation, conservation or liquidation, then the Depositor
may remove the Trustee and appoint a successor trustee by written instrument, in
duplicate, which instrument shall be delivered to the Trustee so removed and to
the successor trustee. A copy of such instrument shall be delivered to the
Certificateholders by the Depositor.
The Holders of Certificates entitled to at least 51% of the Voting
Rights may at any time remove the Trustee and appoint a successor trustee by
written instrument or instruments, in triplicate, signed by such Holders or
their attorneys-in-fact duly authorized, one complete set of which instruments
shall be delivered to the Depositor, one complete set to the Trustee so removed
and one complete set to the successor so appointed. A copy of such instrument
shall be delivered to the Certificateholders by the Depositor.
Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to any of the provisions of this Section shall not
become effective until acceptance of appointment by the successor trustee as
provided in Section 6.08.
Section 6.08. SUCCESSOR TRUSTEE. Any successor trustee appointed as
provided in Section 6.07 shall execute, acknowledge and deliver to the Depositor
and to its predecessor trustee an instrument accepting such appointment
hereunder, and thereupon the resignation or removal of
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the predecessor trustee shall become effective and such successor trustee,
without any further act, deed or conveyance, shall become fully vested with all
the rights, powers, duties and obligations of its predecessor hereunder, with
the like effect as if originally named as trustee herein. The predecessor
trustee shall transfer and deliver to the successor trustee evidence of the
transfer to such successor Trustee of the ownership, on behalf of the
Certificateholders, of the Underlying Certificates and related documents and
statements, as well as all moneys, held by it hereunder, and the Depositor and
the predecessor trustee shall execute and deliver such instruments and do such
other things as may reasonably be required for more fully and certainly vesting
and confirming in the successor trustee all such rights, powers, duties and
obligations.
No successor trustee shall accept appointment as provided in this
Section unless at the time of such acceptance such successor trustee shall be
eligible under the provisions of Section 6.06 and the appointment of such
successor trustee shall not result in a downgrading of any Class of Certificates
by the Rating Agency, as evidenced by a letter from the Rating Agency.
Upon acceptance of appointment by a successor trustee as provided in
this Section, the Depositor shall mail notice of the succession of such trustee
hereunder to all Holders of Certificates at their addresses as shown in the
Certificate Register. If the Depositor fails to mail such notice within 10 days
after acceptance of appointment by the successor trustee, the successor trustee
shall cause such notice to be mailed at the expense of the Depositor.
Section 6.09. MERGER OR CONSOLIDATION OF TRUSTEE. Any corporation or
association into which the Trustee may be merged or converted or with which it
may be consolidated or any corporation or association resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation or association succeeding to the business of the Trustee, shall be
the successor of the Trustee hereunder, provided such corporation or association
shall be eligible under the provisions of Section 6.06, 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 6.10. APPOINTMENT OF OFFICE OR AGENCY. The Trustee will appoint
an office or agency in the City of St. Xxxx, Minnesota where the Certificates
may be surrendered for registration of transfer or exchange, and presented for
final distribution, and where notices and demands to or upon the Trustee in
respect of the Certificates and this Agreement may be served.
Section 6.11. REPRESENTATIONS AND WARRANTIES OF THE TRUSTEE. The
Trustee hereby represents and warrants to the Depositor, as of the Closing Date,
that:
(i) The Trustee is a national banking association duly
organized, validly existing and in good standing under the laws of the
United States.
(ii) The execution and delivery of this Agreement by the
Trustee, and the performance and compliance with the terms of this
Agreement by the Trustee, will not violate the Trustee's charter or bylaws
or constitute a default (or an event which, with notice or lapse of time,
or both, would constitute a default) under, or result in the breach of,
any
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material agreement or other instrument to which it is a party or which is
applicable to it or any of its assets.
(iii) The Trustee has the full power and authority to enter into
and consummate all transactions contemplated by this Agreement, has duly
authorized the execution, delivery and performance of this Agreement, and
has duly executed and delivered this Agreement.
(iv) This Agreement, assuming due authorization, execution and
delivery by the Depositor, constitutes a valid, legal and binding
obligation of the Trustee, enforceable against the Trustee in accordance
with the terms hereof, subject to (A) applicable bankruptcy, insolvency,
receivership, reorganization, moratorium and other laws affecting the
enforcement of creditors' rights generally, and (B) general principles of
equity, regardless of whether such enforcement is considered in a
proceeding in equity or at law.
(v) The Trustee is not in violation of, and its execution and
delivery of this Agreement and its performance and compliance with the
terms of this Agreement will not constitute a violation of, any law, any
order or decree of any court or arbiter, or any order, regulation or
demand of any federal, state or local governmental or regulatory
authority, which violation, in the Trustee's good faith and reasonable
judgment, is likely to affect materially and adversely either the ability
of the Trustee to perform its obligations under this Agreement or the
financial condition of the Trustee.
(vi) No litigation is pending or, to the best of the Trustee's
knowledge, threatened against the Trustee which would prohibit the Trustee
from entering into this Agreement or, in the Trustee's good faith
reasonable judgment, is likely to materially and adversely affect either
the ability of the Trustee to perform its obligations under this Agreement
or the financial condition of the Trustee.
Section 6.12. CERTIFICATE ACCOUNT STATEMENTS. Not later than 15 days
after each Distribution Date, the Trustee shall prepare a statement setting
forth the status of the Certificate Account as of the close of business on the
last day of the month of related Distribution Date, showing that all
distributions required by this Agreement to be made by the Trustee have been
made (or if any required distribution has not been made by the Trustee,
specifying the nature and status thereof) and showing, for the period covered by
such statement, the aggregate of deposits into and withdrawals from the
Certificate Account as provided in Section 3.01. Copies of such statement shall
be provided by the Trustee to any Certificateholder upon request.
Section 6.13. GRANTOR TRUST REPORTING. The Trustee shall furnish or
cause to be furnished to Holders of Certificates and shall file or shall cause
to be filed with the Internal Revenue Service, together with Form 1041 or such
other form as may be applicable, such information with respect to the income and
deductions of the Trust Fund at the time or times and in the manner required by
the Code.
Section 6.14. COMPLIANCE WITH WITHHOLDING REQUIREMENTS. Notwithstanding
any other provision of this Agreement, the Trustee shall comply with all federal
withholding requirements
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with respect to payments to Certificateholders of interest or original issue
discount that the Trustee reasonably believes are applicable under the Code. The
consent of Certificateholders shall not be required for any such withholding. In
the event the Trustee withholds any amount from interest or original issue
discount payments or advances thereof to any Certificateholder pursuant to
federal withholding requirements, the Trustee shall indicate the amount withheld
to such Certificateholder.
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ARTICLE VII
TERMINATION
Section 7.01. TERMINATION UPON DISTRIBUTION TO CERTIFICATEHOLDERS. This
Trust Agreement and the respective obligations and responsibilities of the
Depositor and the Trustee created hereby shall terminate upon the final
distribution to Certificateholders of all amounts required to be distributed
pursuant to Article III; provided, however, that in no event shall the trust
created hereby continue beyond the expiration of 21 years from the death of the
survivor of the descendants of Xxxxxx X. Xxxxxxx, the late ambassador of the
United States to the Court of St.
James's, living on the date hereof.
Notice of any termination, specifying the Final Distribution Date upon
which the Certificateholders may surrender their Certificates to the Trustee for
payment of the final distribution and cancellation, shall be given promptly by
the Trustee by letter to Certificateholders mailed not earlier than the first
day and not later than the 24th day of the month of such final distribution
specifying (A) the Distribution Date upon which the final distribution on the
Certificates will be made upon presentation and surrender of Certificates at the
office of the Trustee therein designated, (B) the amount of any such final
distribution and (C) that the Record Date otherwise applicable to such
Distribution Date is not applicable, distributions being made only upon
presentation and surrender of the Certificates at the office of the Trustee
therein specified; provided, however, that the failure to give such notice will
not entitle any Certificateholder to receive any interest in excess of such
Certificateholder's Percentage Interest of the allocation of the Interest
Distribution Amount for such Final Distribution Date. Upon presentation and
surrender of a Certificate, the Trustee shall cause to be distributed to the
Holder thereof such Holder's final distribution.
Section 7.02. FAILURE OF CERTIFICATEHOLDERS TO SURRENDER CERTIFICATES.
In the event that any of the Certificateholders shall not surrender their
Certificates for cancellation within six months after the Final Distribution
Date, the Trustee shall give a written notice to the remaining
Certificateholders to surrender their Certificates for cancellation and receive
the final distribution with respect thereto. If within one year after such
notice all the Certificates shall not have been surrendered for cancellation,
the Trustee may take appropriate steps, or may appoint an agent to take
appropriate steps, to contact the remaining Certificateholders concerning
surrender of their Certificates, and the cost thereof shall be paid out of the
funds and other assets which remain subject to the Trust Fund.
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ARTICLE VIII
MISCELLANEOUS PROVISIONS
Section 8.01. AMENDMENT. This Agreement may be amended from time to
time by the Depositor and the Trustee without the consent of any of the
Certificateholders, (i) to cure any ambiguity, (ii) to correct, modify or
supplement any provisions herein, or (iii) to make any other provisions with
respect to matters or questions arising under this Agreement which shall not be
inconsistent with the provisions of this Agreement, provided that such action
shall not, as evidenced by an Opinion of Counsel delivered to the Trustee,
adversely affect in any material respect the interests of any Certificateholder.
This Agreement may also be amended from time to time by the Depositor
and the Trustee with the consent of the Holders of Certificates entitled to at
least 66% of the Voting Rights for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Agreement or
of modifying in any manner the rights of the Holders of Certificates; provided,
however, that no such amendment shall (i) reduce in any manner the amount of, or
delay the timing of, payments received on the Underlying Certificates which are
required to be distributed on any Certificate without the consent of the Holder
of such Certificate, (ii) adversely affect in any material respect the interests
of the Holders of any Class of Certificates in a manner other than as described
in the immediately preceding clause (i), without the consent of the Holders of
Certificates of such Class evidencing at least 66% of the Voting Rights
allocated to such Class, or (iii) modify the consents required by the
immediately preceding clauses (i) and (ii) without the consent of the Holders of
all Certificates then outstanding. Notwithstanding any other provision of this
Agreement, for purposes of the giving or withholding of consents pursuant to
this Section 8.01, Certificates registered in the name of the Depositor or the
Trustee or any Affiliate thereof shall be entitled to Voting Rights with respect
to matters affecting such Certificates.
Notwithstanding any contrary provision of this Agreement, the Trustee
shall not consent to any amendment to this Agreement unless it shall have first
received an Opinion of Counsel, at the expense of the party seeking such
amendment, to the effect that such amendment will not result in the imposition
of any tax on the Trust Fund or cause the Trust Fund to fail to qualify as a
grantor trust at any time that any Certificates are outstanding.
Promptly after the execution of any such amendment the Trustee shall
furnish a copy of such amendment to each Certificateholder and to the Rating
Agency.
It shall not be necessary for the consent of Certificateholders under
this Section 8.01 to approve the particular form of any proposed amendment, but
it shall be sufficient if such consent shall approve the substance thereof. The
manner of obtaining such consents and of evidencing the authorization of the
execution thereof by Certificateholders shall be subject to such reasonable
regulations as the Trustee may prescribe.
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The cost of any Opinion of Counsel to be delivered pursuant to this
Section 8.01 shall be borne by the Person seeking the related amendment, but in
no event shall such Opinion of Counsel be an expense of the Trustee.
The Trustee may, but shall not be obligated to enter into any amendment
pursuant to this Section that affects its rights, duties and immunities under
this Agreement or otherwise.
Section 8.02. LIMITATION ON RIGHTS OF CERTIFICATEHOLDERS. The death or
incapacity of any Certificateholder shall not operate to terminate this
Agreement or the Trust Fund, nor entitle such Certificateholder's legal
representatives or heirs to claim an accounting or to take any action or
proceeding in any court for a partition or winding up of the Trust Fund, nor
otherwise affect the rights, obligations and liabilities of the parties hereto
or any of them.
No Certificateholder shall have any right to vote (except as expressly
provided for herein) or in any manner otherwise control the operation and
management of the Trust Fund, or the obligations of the parties hereto, nor
shall anything herein set forth, or contained in the terms of the Certificates,
be construed so as to constitute the Certificateholders from time to time as
partners or members of an association; nor shall any Certificateholder be under
any liability to any third person by reason of any action taken by the parties
to this Agreement pursuant to any provision hereof.
No Certificateholder shall have any right by virtue of any provision of
this Agreement to institute any suit, action or proceeding in equity or at law
upon or under or with respect to this Agreement, unless such Holder previously
shall have given to the Trustee a written notice of default and of the
continuance thereof, as provided above, and unless also the Holders of
Certificates entitled to at least 25% of the Voting Rights shall have made
written request upon the Trustee to institute such action, suit or proceeding in
its own name as Trustee hereunder and shall have offered to the Trustee such
reasonable indemnity as it may require against the costs, expenses and
liabilities to be incurred therein or thereby, and the Trustee, for 15 days
after its receipt of such notice, request and offer of indemnity, shall have
neglected or refused to institute any such action, suit or proceeding. It is
understood and intended, and expressly covenanted by each Certificateholder with
every other Certificateholder and the Trustee, that no one or more Holders of
Certificates shall have any right in any manner whatsoever by virtue of any
provision of this Agreement to affect, disturb or prejudice the rights of the
Holders of any other of such Certificates, or to obtain or seek to obtain
priority over or preference to any other such Holder, 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, each and every Certificateholder
and the Trustee shall be entitled to such relief as can be given either at law
or in equity.
Section 8.03. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE
AND TO BE PERFORMED IN THE STATE OF NEW YORK, AND THE OBLIGATIONS, RIGHTS AND
REMEDIES OF THE PARTIES HERETO AND THE CERTIFICATEHOLDERS SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
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Section 8.04. NOTICES. All directions, demands and notices hereunder
shall be in writing and shall be deemed to have been duly given when received if
personally delivered at or mailed by first class mail, postage prepaid, or by
express delivery service or delivered in any other manner specified herein, to
(a) in the case of the Depositor, Salomon Brothers Mortgage Securities VII,
Inc., Xxxxx Xxxxx Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Mortgage
Finance Group (telecopy number (000) 000-0000), or to such other address as may
hereafter be furnished to the Trustee in writing by the Depositor; (b) in the
case of the Trustee, First Trust National Association, 000 Xxxx Xxxxx Xxxxxx,
Xx. Xxxx, Xxxxxxxxx 00000, Attention: Salomon Brothers Mortgage Securities VII,
Inc., Series 1996-4 (telecopy number (612) 244- 0089), or such other address as
may hereafter be furnished to the Depositor in writing by the Trustee. Any
notice required or permitted to be mailed to a Certificateholder shall be given
by first class mail, postage prepaid, at the address of such Holder as shown in
the Certificate Register. Any notice so mailed to a Holder within the time
prescribed in this Agreement shall be conclusively presumed to have been duly
given whether or not the Certificateholder receives such notice. A copy of any
notice telecopied hereunder shall be mailed to the appropriate party in the
manner set forth above.
Section 8.05. 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.
Section 8.06. NOTICE TO RATING AGENCY. Without limiting any other
provision hereunder requiring notice to or a response from the Rating Agency,
the Trustee shall use its best efforts promptly to provide notice to the Rating
Agency with respect to each of the following of which it has actual knowledge:
1. Any material change or amendment to this Agreement;
2. The occurrence of any default that has not been cured or waived;
3. The resignation or termination of the Trustee;
4. The final payment to the Holders of any Class of Certificates; and
5. Any change in the location of the Certificate Account.
The Trustee shall promptly furnish to the Rating Agency copies of each
report to Certificateholders described in Section 3.03 and copies of each annual
statement as to compliance described in Section 6.14.
Any such notice pursuant to this Section 8.06 shall be in writing and
shall be deemed to have been duly given if personally delivered at or mailed by
first class mail, postage prepaid,
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or by express delivery service to Standard & Poor's Ratings Services, 00
Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, or such other addresses as the Rating Agency
may designate in writing to the parties hereto.
Section 8.07. ARTICLE AND SECTION REFERENCES. All article and section
references used in this Agreement, unless otherwise provided, are to articles
and sections in this Agreement.
Section 8.08. EXECUTION IN COUNTERPARTS. This Agreement may be executed
in one or more counterparts, all of which shall be considered one and the same
agreement, and shall become a binding agreement when one or more counterparts
have been signed by each party and delivered to the other party.
IN WITNESS WHEREOF, the Depositor and the Trustee have caused their
names to be signed hereto by their respective officers thereunto duly
authorized, all as of the day and year first above written.
SALOMON BROTHERS MORTGAGE
SECURITIES VII, INC.,
as Depositor
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Assistant Vice President
FIRST TRUST NATIONAL ASSOCIATION,
as Trustee
By: /s/ Xxx X. Xxxxxx
----------------------------
Name: Xxx X. Xxxxxx
Title: Vice President
STATE OF NEW YORK )
)ss.:
COUNTY OF NEW YORK )
On the 30th day of September, 1996 before me, a notary public in and
for said State, personally appeared Xxxxxxx X. Xxxxxxxx, known to me to be an
Assistant Vice President of Salomon Brothers Mortgage Securities VII, Inc., one
of the corporations that executed the within instrument, and also known to me to
be the person who executed it on behalf of said corporation, and acknowledged to
me that such corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official
seal the day and year in this certificate first above written.
-------------------------
Notary Public
[Notarial Seal]
STATE OF __________ )
)ss.:
COUNTY OF __________ )
On the 30th day of September, 1996 before me, a notary public in and
for said State, personally appeared Xxx X. Xxxxxx, known to me to be a Vice
President of First Trust 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 A
FORM OF CERTIFICATE
Series 1996-4, Class __ Aggregate Certificate Principal
Balance of Class __ Certificates as
of the Issue Date:
Fixed Pass-Through Rate: $____________
_____% per annum
Denomination: $____________
Date of Trust Agreement: Trustee: First Trust National
September 30, 1996 Association
Issue Date: September 30, 1996
First Distribution Date: October 29, 1996
No. ____
CUSIP No. 79548K ____ __
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF
THIS CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN.
ACCORDINGLY, THE OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF
AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ABOVE AS THE
DENOMINATION OF THIS CERTIFICATE.
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TRUST CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund consisting primarily
of the Underlying Certificates, such Trust Fund formed and the Underlying
Certificates deposited therein by
SALOMON BROTHERS MORTGAGE
SECURITIES VII, INC.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST
IN SALOMON BROTHERS MORTGAGE SECURITIES VII, INC., THE TRUSTEE OR
ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR
THE UNDERLYING CERTIFICATES ARE GUARANTEED BY ANY AGENCY OR
INSTRUMENTALITY OF THE UNITED STATES.
This certifies that _______________ is the registered owner of a
Percentage Interest (obtained by dividing the denomination of this Certificate
by the aggregate Certificate Principal Balance of the Certificates as of the
Issue Date) in that certain beneficial ownership interest evidenced by all the
Certificates in the Trust Fund created pursuant to a Trust Agreement, dated as
specified above (the "Agreement"), between Salomon Brothers Mortgage Securities
VII, Inc. (hereinafter called the "Depositor", which term includes any successor
entity under the Agreement) and the Trustee, a summary of certain of the
pertinent provisions of which is set forth hereafter. To the extent not defined
herein, the capitalized terms used herein have the meanings assigned in the
Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the second Business Day following the Underlying Certificate Distribution
Date (a "Distribution Date"), commencing on the First Distribution Date
specified above, to the Person in whose name this Certificate is registered on
the last Business Day of the month immediately preceding the month of such
distribution (the "Record Date"), in an amount equal to the product of the
Percentage Interest evidenced by this Certificate and the amount required to be
distributed to the Holders of Certificates on such Distribution Date pursuant to
the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date and is the registered owner of Certificates the aggregate
initial Certificate Principal Balance of which is in excess of $5,000,000, or
otherwise by check mailed by first class mail to the address of the Person
entitled thereto, as such name and address shall appear on the Certificate
Register. 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
-3-
presentation and surrender of this Certificate at the office or agency appointed
by the Trustee for that purpose as provided in the Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Trust Certificates of the Series specified on the face hereof
(herein called the "Trust Certificates") and representing a Percentage Interest
in the Trust Certificates specified on the face hereof equal to the denomination
specified on the face hereof divided by the aggregate Certificate Principal
Balance of the Trust Certificates specified on the face hereof.
The Trust Certificates are limited in right of payment to certain
collections and recoveries respecting the Underlying Certificates, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Certificate Account may be made from time to
time for purposes other than distributions to Certificateholders, such purposes
including compensation to the Trustee and reimbursement of certain expenses
incurred with respect to the Trust Fund.
The Agreement permits, with certain exceptions therein provided,
the amendment thereof and the modification of the rights and obligations of the
Depositor and the Trustee and the rights of the Certificateholders under the
Agreement at any time by the Depositor and the Trustee with the consent of the
Holders of Certificates entitled to at least 66% of the Voting Rights. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Trust
Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
in authorized denominations evidencing the same aggregate Percentage Interest
will be issued to the designated transferee or transferees.
The Trust Certificates are issuable in fully registered form only
without coupons in denominations representing Percentage Interests specified in
the Agreement. As provided in the Agreement and subject to certain limitations
therein set forth, Certificates are exchangeable for new Certificates of the
same Class in authorized denominations evidencing the same aggregate Percentage
Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of
transfer or exchange of Trust Certificates, but the Trustee may require payment
of a sum sufficient to cover any tax or
-4-
other governmental charge that may be imposed in connection with any transfer or
exchange of Trust Certificates.
The Depositor, the Trustee and the Certificate Registrar and any
agent of the Depositor, the Trustee or the Certificate Registrar may treat the
Person in whose name this Certificate is registered as the owner hereof for all
purposes, and neither the Depositor, the Trustee, the Certificate Registrar nor
any such agent shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund
created thereby shall terminate upon payment (or provision for payment) to the
Certificateholders of all amounts held by or on behalf of the Trustee and
required to be paid to them pursuant to the Agreement following the final
payment (or any advance with respect thereto) on the Underlying Certificates.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed
by the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed under its official seal.
Dated: __________
FIRST TRUST NATIONAL ASSOCIATION,
as Trustee
By_________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Trust Certificates referred to in the
within-mentioned Agreement.
FIRST TRUST NATIONAL ASSOCIATION,
as Certificate Registrar
___________________________________
By: Authorized Signatory
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - CUSTODIAN
-------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right _________________
if survivorship and not as (State)
tenants in common
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
the Percentage Interest evidenced by the within Trust Certificate and hereby
authorize(s) the registration of transfer of such interest to assignee on the
Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new Certificate
of a like Percentage Interest and Class to the above named assignee and deliver
such Certificate to the following address:______________________________________
_______________________________________________________________________________.
Dated:
_______________________________________
Signature by or on behalf of assignor
_______________________________________
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to______________________________________________________________
____________________________________________________________________ for the
account of _________________________________________________ account number
____________________________, or, if mailed by check, to ______________________
_______________________________. Applicable statements should be mailed to
____________________________________________________.
This information is provided by___________________________________
_______________________________________________, the assignee named above, or
___________________________, as its agent.
EXHIBIT B
UNDERLYING CERTIFICATES
Certificate or
Initial Certificate Component Principal
Percentage or Component Balance as of the
Designation Interest Principal Balance Closing Date
----------- -------- ----------------- ------------
The Prudential Home Mortgage Securities 100% $49,000,000 $49,000,000
Company, Inc., Mortgage Pass-Through
Certificates, Series 1994-8, Class A-5
Class A-5 PAC I Component $12,250,000 $12,250,000
Class A-5 PAC II Component $36,750,000 $36,750,000
The GE Capital Mortgage Services, Inc., 100% $46,000,000 $42,578,376
REMIC Multi-Class Pass-Through
Certificates, Series 1994-11, Class A-11
Class A-11A PAC Component $10,580,000 $7,158,376
Class A-11B PAC Component $13,340,000 $13,340,000
Class A-11C PAC Component $22,080,000 $22,080,000
The CWMBS, Inc., Mortgage Pass-Through approximately $50,000,000 $48,087,790
Certificates, Series 1993-5, Class A-8 96.29%
Class A-8-1 Component $7,270,000 $5,349,801
Class A-8-2 Component $44,658,000 $42,737,989
The Residential Funding Mortgage Securities approximately $34,777,700 $33,496,249
I, Inc., Mortgage Pass-Through Certificates, 100.00%
Series 1993-S34, Class A-4
Class A-4 PAC Component $2,620,000 $2,619,947
Class A-4 SAC Component $14,700,000 $13,418,955
Class A-4 TAC Component 1 $14,410,000 $14,409,709
Class A-4 TAC Component 2 $3,047,700 $3,047,638
