EXECUTION
STRUCTURED ASSET SECURITIES CORPORATION, as Depositor,
and
NORWEST BANK MINNESOTA, N.A., as Trustee
___________________________
TRUST AGREEMENT
Dated as of January 1, 1997
___________________________
STRUCTURED ASSET SECURITIES CORPORATION
MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 1997-1
TABLE OF CONTENTS
Section Page
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ARTICLE I
DEFINITIONS
1.01. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.02. Calculations Respecting Mortgage Loans . . . . . . . . . . . . . . 30
1.03. Calculations Respecting Accrued Interest . . . . . . . . . . . . . 30
ARTICLE II
DECLARATION OF TRUST;
ISSUANCE OF CERTIFICATES
2.01. Creation and Declaration of Trust Fund;
Conveyance of Mortgage Loans . . . . . . . . . . . . . . . . . . . 30
2.02. Acceptance of Trust Fund by Trustee: Review
of Documentation for Trust Fund . . . . . . . . . . . . . . . . . 32
2.03. Representations and Warranties of the Depositor . . . . . . . . . 32
2.04. Discovery of Breach . . . . . . . . . . . . . . . . . . . . . . . 34
2.05. Repurchase, Purchase or Substitution of
Mortgage Loans . . . . . . . . . . . . . . . . . . . . . . . . . . 35
2.06. Converted Mortgage Loans . . . . . . . . . . . . . . . . . . . . . 36
2.07. Grant Clause . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
ARTICLE III
THE CERTIFICATES
3.01. The Certificates . . . . . . . . . . . . . . . . . . . . . . . . . 36
3.02. Registration . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
3.03. Transfer and Exchange of Certificates . . . . . . . . . . . . . . 38
3.04. Cancellation of Certificates . . . . . . . . . . . . . . . . . . . 41
3.05. Replacement of Certificates . . . . . . . . . . . . . . . . . . . 41
3.06. Persons Deemed Owners . . . . . . . . . . . . . . . . . . . . . . 42
3.07. Temporary Certificates . . . . . . . . . . . . . . . . . . . . . . 42
3.08. Appointment of Paying Agent . . . . . . . . . . . . . . . . . . . 42
3.09. Book-Entry Certificates . . . . . . . . . . . . . . . . . . . . . 43
ARTICLE IV
ADMINISTRATION OF THE TRUST FUND
4.01. (Omitted). . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
4.02. (Omitted). . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
4.03. Reports to Certificateholders . . . . . . . . . . . . . . . . . . 45
4.04. Certificate Account . . . . . . . . . . . . . . . . . . . . . . . 47
4.05. Determination of LIBOR . . . . . . . . . . . . . . . . . . . . . . 48
ARTICLE V
DISTRIBUTIONS TO HOLDERS OF CERTIFICATES
5.01. Distributions Generally . . . . . . . . . . . . . . . . . . . . . 50
5.02. Distributions from the Certificate Account . . . . . . . . . . . . 50
5.03. Allocation of Realized Losses . . . . . . . . . . . . . . . . . . 54
5.04. Trustee Advances . . . . . . . . . . . . . . . . . . . . . . . . . 56
5.05. Distributions of Principal on Redemption
Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
ARTICLE VI
CONCERNING THE TRUSTEE; EVENTS OF DEFAULT
6.01. Duties of Trustee . . . . . . . . . . . . . . . . . . . . . . . . 63
6.02. Certain Matters Affecting the Trustee . . . . . . . . . . . . . . 64
6.03. Trustee Not Liable for Certificates . . . . . . . . . . . . . . . 65
6.04. Trustee May Own Certificates . . . . . . . . . . . . . . . . . . . 66
6.05. Eligibility Requirements for Trustee . . . . . . . . . . . . . . . 66
6.06. Resignation and Removal of Trustee . . . . . . . . . . . . . . . . 66
6.07. Successor Trustee . . . . . . . . . . . . . . . . . . . . . . . . 67
6.08. Merger or Consolidation of Trustee . . . . . . . . . . . . . . . . 68
6.09. Appointment of Co-Trustee, Separate Trustee
or Custodian . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
6.10. Authenticating Agents . . . . . . . . . . . . . . . . . . . . . . 70
6.11. Indemnification of Trustee . . . . . . . . . . . . . . . . . . . . 71
6.12. Fees and Expenses of Trustee . . . . . . . . . . . . . . . . . . . 72
6.13. Collection of Monies . . . . . . . . . . . . . . . . . . . . . . . 72
6.14. Trustee To Act; Appointment of Successor . . . . . . . . . . . . . 72
6.15. Additional Remedies of Trustee Upon Event
of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
6.16. Waiver of Defaults . . . . . . . . . . . . . . . . . . . . . . . . 75
6.17. Notification to Holders . . . . . . . . . . . . . . . . . . . . . 75
6.18. Directions by Certificateholders and Duties
of Trustee During Event of Default . . . . . . . . . . . . . . . . 75
6.19. Action Upon Certain Failures of the Servicer
and Upon Event of Default . . . . . . . . . . . . . . . . . . . . 76
ARTICLE VII
PURCHASE AND TERMINATION
OF THE TRUST FUND
7.01. Termination of Trust Fund Upon Repurchase
or Liquidation of All Mortgage Loans . . . . . . . . . . . . . . . 76
7.02. Procedure Upon Termination of Trust Fund . . . . . . . . . . . . . 77
7.03. Additional Trust Fund Termination Requirements . . . . . . . . . . 78
ARTICLE VIII
RIGHTS OF CERTIFICATEHOLDERS
8.01. Limitation on Rights of Holders . . . . . . . . . . . . . . . . . 79
8.02. Access to List of Holders . . . . . . . . . . . . . . . . . . . . 80
8.03. Acts of Holders of Certificates . . . . . . . . . . . . . . . . . 81
ARTICLE IX
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
9.01. Trustee To Retain Possession of Certain Documents . . . . . . . . 82
9.02. Preparation of Tax Returns and Other Reports . . . . . . . . . . . 82
9.03. Release of Mortgage Files . . . . . . . . . . . . . . . . . . . . 82
ARTICLE X
REMIC ADMINISTRATION
10.01. REMIC Administration . . . . . . . . . . . . . . . . . . . . . . 84
10.02. Prohibited Transactions and Activities . . . . . . . . . . . . . 86
10.03. Indemnification with Respect to Certain Taxes
and Loss of REMIC Status . . . . . . . . . . . . . . . . . . . . 86
ARTICLE XI
MISCELLANEOUS PROVISIONS
11.01. Binding Nature of Agreement; Assignment . . . . . . . . . . . . . 87
11.02. Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . 87
11.03. Amendment . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
11.04. Voting Rights . . . . . . . . . . . . . . . . . . . . . . . . . . 88
11.05. Provision of Information . . . . . . . . . . . . . . . . . . . . 89
11.06. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . 89
11.07. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
11.08. Severability of Provisions . . . . . . . . . . . . . . . . . . . 90
11.09. Indulgences; No Waivers . . . . . . . . . . . . . . . . . . . . . 90
11.10. Headings Not To Affect Interpretation . . . . . . . . . . . . . . 90
11.11. Benefits of Agreement . . . . . . . . . . . . . . . . . . . . . . 90
11.12. Special Notices to the Rating Agencies. . . . . . . . . . . . . . 91
11.13. Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . 91
ATTACHMENTS
Exhibit A Forms of Certificates
Exhibit B-1 Form of Trustee Final Certification
Exhibit B-2 Form of Endorsement
Exhibit C Request for Release of Documents and Receipt
Exhibit D-l Residual Certificate Transfer Affidavit (Transferee)
Exhibit D-2 Residual Certificate Transfer Affidavit (Transferor)
Exhibit E Sale and Servicing Agreement
Exhibit F Form of Rule 144A Transfer Certificate
Exhibit G Form of Purchaser's Letter for Institutional Accredited
Investors
Exhibit H Form of ERISA Transfer Affidavit
Exhibit I Monthly Remittance Advice
Exhibit J Monthly Electronic Data Transmission
Exhibit K Custodial Agreement
Schedule A Mortgage Loan Schedule
Schedule B Principal Amount Schedules
This TRUST AGREEMENT, dated as of January 1, 1997 (the "Agreement"), is
by and between STRUCTURED ASSET SECURITIES CORPORATION, a Delaware
corporation, as depositor (the "Depositor"), and NORWEST BANK MINNESOTA,
N.A., a national banking association, as trustee (the "Trustee").
PRELIMINARY STATEMENT
The Depositor has acquired the Mortgage Loans from Xxxxxx Capital, A
Division of Xxxxxx Brothers Holdings Inc. (the "Seller"), and at the Closing
Date is the owner of the Mortgage Loans and the other property being conveyed
by it to the Trustee for inclusion in the Trust Fund. On the Closing Date,
the Depositor will acquire the Certificates from the Trust Fund, as
consideration for its transfer to the Trust Fund of the Mortgage Loans and
the other property constituting the Trust Fund. The Depositor has duly
authorized the execution and delivery of this Agreement to provide for the
conveyance to the Trustee of the Mortgage Loans and the other property
constituting the Trust Fund. All covenants and agreements made by the
Depositor and the Trustee herein with respect to the Mortgage Loans and the
other property constituting the Trust Fund are for the benefit of the Holders
from time to time of the Certificates. The Depositor is entering into this
Agreement, and the Trustee is accepting the Trust Fund created hereby, for
good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged.
The following table sets forth (or describes) the Class designation,
Certificate Interest Rate, initial Class Certificate Principal Amount (or
Aggregate Notional Amount) and minimum denomination for each Class of
Certificates comprising the interests in the Trust Fund created hereunder.
Class Certificate Interest Initial Certificate Minimum
Designation Rate Principal Amount Denominations
Class A (1) $164,573,000.00 $100,000
Class B1 (1) 2,572,000.00 250,000
Class B2 (1) 1,285,000.00 250,000
Class B3 (1) 857,000.00 250,000
Class B4 (1) 1,115,000.00 250,000
Class B5 (1) 514,000.00 250,000
Class B6 (1) 514,801.69 250,000
Class R (1) 100.00 100
______________________
(1) The Certificate Interest Rate with respect to any Distribution Date for
each Class of Certificates is a per annum variable rate equal to the
Weighted Average Rate for such Distribution Date.
As of the Cut-off Date, the Mortgage Loans had an aggregate Scheduled
Principal Balance of $171,430,901.69.
In consideration of the mutual agreements herein contained, the
Depositor and the Trustee hereby agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01. Definitions. The following words and phrases, unless
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the context otherwise requires, shall have the following meanings:
Accepted Servicing Practices: As defined in the Sale and Servicing
----------------------------
Agreement.
Accountant: A person engaged in the practice of accounting who
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(except when this Agreement provides that an Accountant must be Independent)
may be employed by or affiliated with the Depositor or an Affiliate of the
Depositor.
Accretion Directed Certificate: None.
------------------------------
Accretion Termination Date: The earlier of (i) the Credit Support
--------------------------
Depletion Date and (ii) the date on which the Class Certificate Principal
Amount of each Class of Accretion Directed Certificates has been reduced to
zero.
Accrual Amount: As to any Class of Accrual Certificates and any
--------------
Accrual Component and each Distribution Date through the Credit Support
Depletion Date, the sum of (x) any amount of Accrued Certificate Interest
allocable to such Class or Component pursuant to Section 5.02(a)(ii) on such
Distribution Date and (y) any Interest Shortfall allocable to such Class or
Component pursuant to Section 5.02(a)(iii) on such Distribution Date. As
to any Class of Accrual Certificates and any Accrual Component and each
Distribution Date after the Credit Support Depletion Date, zero.
Accrual Certificate: None.
-------------------
Accrual Component: None.
-----------------
Accrued Certificate Interest: As to any Class of Certificates or
----------------------------
Component and any Distribution Date, the product of the Certificate Interest
Rate or Component Interest Rate for such Class of Certificates or Component
and the outstanding Class Certificate Principal Amount (or Aggregate Notional
Amount) or Component Principal Amount of such Class of Certificates or
Component immediately preceding such Distribution Date, as reduced by (i)
such Class's or Component's pro rata share of the interest portion of any
Excess Losses for such date and, after the Credit Support Depletion Date, any
Realized Losses for such date, (ii) such Class's or Component's pro rata
share of any Relief Act Reduction for such date and (iii) any Deferred
Interest allocated to such Class or Component on such date.
Additional Collateral: As defined in the Sale and Servicing
---------------------
Agreement.
Advance: An advance of the aggregate of payments of principal and
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interest (net of the Servicing Fee) on one or more Mortgage Loans that were
due on the Due Date in the related Due Period and not received as of the
close of business on the related Determination Date, required to be made by
the Servicer pursuant to the Sale and Servicing Agreement (or by the Trustee
hereunder).
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.
Aggregate Notional Amount: With respect to any Class of Notional
-------------------------
Certificates, the applicable aggregate notional amount described in the
Preliminary Statement hereto.
Aggregate Principal Balance: The aggregate of the Scheduled
---------------------------
Principal Balances for all Mortgage Loans at the date of determination.
Aggregate Voting Interests: The aggregate of the Voting Interests of
--------------------------
all the Certificates under this Agreement.
Agreement: This Trust Agreement and all amendments and supplements
---------
hereto.
Appraised Value: With respect to any Mortgage Loan, the amount set
---------------
forth in an appraisal made in connection with the origination of such
Mortgage Loan as the value of the related Mortgaged Property.
Assignment of Mortgage: An assignment of the Mortgage, notice of
----------------------
transfer or equivalent instrument, in recordable form, sufficient under the
laws of the jurisdiction wherein the related Mortgaged Property is located to
reflect the sale of the Mortgage to the Trustee, which assignment, notice of
transfer or equivalent instrument may be in the form of one or more blanket
assignments covering the Mortgage Loans secured by Mortgaged Properties
located in the same jurisdiction, if permitted by law; provided, however,
that the Trustee shall not be responsible for
-------- -------
determining whether any such assignment is in recordable form.
Authenticating Agent: Any authenticating agent appointed by the
--------------------
Trustee pursuant to Section 6.10.
Authorized Officer: Any Person who may execute an Officer's
------------------
Certificate on behalf of the Depositor.
Available Distribution Amount: On any Distribution Date, the sum of
-----------------------------
the following amounts:
(1) the total amount of all cash received by the Servicer through
the related Remittance Date and deposited by the Servicer prior to such
Distribution Date with respect to the Mortgage Loans (including proceeds
of any Insurance Policy and any other credit support relating to the
Mortgage Loans), plus all Advances made by the Servicer (or Trustee) for
such Distribution Date and any Compensating Interest Payment for such
date, but not including:
(a) all amounts distributed pursuant to Section 5.02 on prior
Distribution Dates;
(b) all Scheduled Payments of principal and interest
collected but due on a date subsequent to the related Due Period;
(c) all Principal Prepayments received or identified by the
Servicer after the related Prepayment Period (together with any
interest payments received with such prepayments to the extent that
they represent the payment of interest accrued on the related
Mortgage Loans for the period subsequent to the related Prepayment
Period);
(d) any other unscheduled recovery, including Liquidation
Proceeds and Insurance Proceeds received by the Servicer after the
related Prepayment Period; and
(e) all amounts due or reimbursable to the Trustee or the
Servicer pursuant to the terms of this Agreement or to the Servicer
pursuant to the Sale and Servicing Agreement; and
(2) any other payment made by the Servicer or the Depositor or any
other Person with respect to such Distribution Date (including the
Purchase Price with respect to any Mortgage Loan repurchased by the
Servicer, the Depositor, Xxxxxx Capital or any other Person and the
purchase price for any Converted Mortgage Loan purchased from the Trust
Fund).
Bankruptcy: As to any Person, the making of an assignment for the
----------
benefit of creditors, the filing of a voluntary petition in bankruptcy,
adjudication as a bankrupt or insolvent, the entry of an order for relief in
a bankruptcy or insolvency proceeding, the seeking of reorganization,
arrangement, composition, readjustment, liquidation, dissolution or similar
relief, or seeking, consenting to or acquiescing in the appointment of a
trustee, receiver or liquidator, dissolution, or termination, as the case may
be, of such Person pursuant to the provisions of either the United States
Bankruptcy Code of 1986, as amended, or any other similar state laws.
Bankruptcy Coverage Termination Date: The Distribution Date on which
------------------------------------
the Bankruptcy Loss Limit has been reduced to zero (or less than zero).
Bankruptcy Loss Limit: As of the Cut-off Date, $200,000, which
---------------------
amount shall be reduced from time to time by the amount of Bankruptcy Losses
allocated to the Certificates.
Bankruptcy Losses: (i) with respect to the Mortgage Loans, losses
-----------------
arising from a proceeding under the United States Bankruptcy Code or any
other similar state law or other proceeding with respect to the Mortgagor of
or Mortgaged Property under a Mortgage Loan, including without limitation any
such loss arising from (a) the difference between (i) the principal amount
that would have been due under the original scheduled payments of principal
and interest due on the related Mortgage Loan and (ii) the value established
in the relevant court with respect to such Mortgaged Property, including
without limitation a Deficient Valuation, or (b) a Debt Service Reduction.
Benefit Plan Opinion: An Opinion of Counsel satisfactory to the
--------------------
Trustee to the effect that any proposed transfer will not (i) cause the
assets of the Trust Fund to be regarded as plan assets for purposes of the
Plan Asset Regulations or (ii) give rise to any fiduciary duty on the part of
the Depositor or the Trustee.
Blanket Mortgage: The mortgage or mortgages encumbering a
----------------
Cooperative Property.
Book-Entry Certificates: Beneficial interests in Certificates
-----------------------
designated as "Book-Entry Certificates" in this Agreement, ownership and
transfers of which shall be evidenced or made through book entries by a
Clearing Agency as described in Section 3.09; provided, that after the
occurrence of a condition whereupon book-entry registration and transfer are
no longer permitted and Definitive Certificates are to be issued to
Certificate Owners, such Book-Entry Certificates shall no longer be
"Book-Entry Certificates." As of the Closing Date, the Class A Certificates
are Book-Entry Certificates.
Business Day: Any day other than (i) a Saturday or a Sunday, or (ii)
------------
a day on which banking institutions in New York, New York or, if other than
New York, the city in which the Corporate Trust Office of the Trustee is
located, or the State of Massachusetts, are authorized or obligated by law or
executive order to be closed.
Certificate: Any one of the certificates signed and countersigned by
-----------
the Trustee in substantially the forms attached hereto as Exhibit A.
Certificate Account: The account maintained by the Trustee in
-------------------
accordance with the provisions of Section 4.04.
Certificate Interest Rate: With respect to each Class of
-------------------------
Certificates, the applicable per annum rate set forth or described in the
Preliminary Statement hereto.
Certificate Owner: With respect to a Book-Entry Certificate, the
-----------------
Person who is the owner of such Book-Entry Certificate, as reflected on the
books of the Clearing Agency, or on the books of a Person maintaining an
account with such Clearing Agency (directly or as an indirect participant, in
accordance with the rules of such Clearing Agency).
Certificate Principal Amount: With respect to any Certificate other
----------------------------
than a Notional Certificate, at the time of determination, the maximum
specified dollar amount of principal to which the Holder thereof is then
entitled hereunder, such amount being equal to the initial principal amount
set forth on the face of such Certificate (plus any Deferred Interest
allocated thereto on previous Distribution Dates, and plus, in the case of
any Accrual Certificate, its Percentage Interest of any related Accrual
Amount for each previous Distribution Date), less the amount of all principal
distributions previously made with respect to such Certificate, all Realized
Losses previously allocated to such Certificate, and, in the case of a
Subordinate Certificate, any Subordinate Certificate Writedown Amount
previously allocated to such Certificate. For purposes of Article V hereof,
unless specifically provided to the contrary, Certificate Principal Amounts
shall be determined as of the close of business of the immediately preceding
Distribution Date, after giving effect to all distributions made on such
date. Notional Certificates are issued without Certificate Principal
Amounts.
Certificate Register and Certificate Registrar: The register
----------------------------------------------
maintained and the registrar appointed pursuant to Section 3.02.
Certificateholder: The meaning provided in the definition of
----------------------
"Holder."
Class: All Certificates bearing the same class designation.
Class B Certificate: Any Class B1, Class B2, Class B3, Class B4,
-------------------
Class B5 or Class B6 Certificate.
Class Certificate Principal Amount: With respect to each Class of
----------------------------------
Certificates other than any Class of Notional Certificates, the aggregate of
the Certificate Principal Amounts of all Certificates of such Class at the
date of determination.
Class Percentage: For each Class of Certificates or Component, for
----------------
each Distribution Date, the percentage obtained by dividing the Class
Certificate Principal Amount or Component Principal Amount of such Class or
Component immediately prior to such Distribution Date by the aggregate
Certificate Principal Amount or Component Principal Amount of all
Certificates immediately prior to such date.
Clearing Agency: An organization registered as a "clearing agency"
---------------
pursuant to Section 17A of the Securities Exchange Act of 1934, as amended.
As of the Closing Date, the Clearing Agency shall be The Depository Trust
Company.
Clearing Agency Participant: A broker, dealer, bank, other financial
---------------------------
institution or other Person for whom from time to time a Clearing Agency
effects book-entry transfers and pledges of securities deposited with the
Clearing Agency.
Closing Date: January 29, 1997.
------------
Code: The Internal Revenue Code of 1986, as amended, and as it may
----
be further amended from time to time, any successor statutes thereto, and
applicable U.S. Department of Treasury regulations issued pursuant thereto in
temporary or final form.
Collection Account: Not applicable.
------------------
Collection Period: With respect to any Distribution Date, the period
-----------------
beginning immediately following the conclusion of the next preceding
Collection Period (or, in the case of the first Distribution Date, beginning
on the Cut-off Date) and ending at the close of the Business Day immediately
preceding the related Remittance Date.
Compensating Interest Payment: With respect to any Distribution
-----------------------------
Date, the amount paid by the Servicer in respect of Prepayment Interest
Shortfalls pursuant to Section 4.04(viii) of the Sale and Servicing
Agreement.
Component: None.
---------
Component Certificate: None.
---------------------
Component Interest Rate: None.
-----------------------
Component Principal Amount: As of any Distribution Date and with
--------------------------
respect to any Component, other than any Notional Component, the initial
Component Principal Amount thereof as set forth in the definition of
Component (plus any Deferred Interest allocated thereto on previous
Distribution Dates and plus, in the case of any Accrual Component, any
related Accrual Amount for each previous Distribution Date), less the sum of
(x) all amounts distributed in reduction thereof on previous Distribution
Dates pursuant to Section 5.02, (y) the amount of all Realized Losses
previously allocated thereto pursuant to Section 5.03 and (z) any Subordinate
Certificate Writedown Amount previously allocated to such Component.
Conventional Loan: A Mortgage Loan that is not insured by the United
-----------------
States Federal Housing Administration or guaranteed by the United States
Veterans Administration.
Converted Mortgage Loan: Any Convertible Mortgage Loan with respect
-----------------------
to which the related Mortgagor has exercised its option to convert the
Mortgage Rate thereof from an adjustable to a fixed rate.
Convertible Mortgage Loan: Any Mortgage Loan pursuant to which the
-------------------------
related Mortgagor may elect to convert the Mortgage Rate thereof from an
adjustable rate to a fixed rate of interest.
Cooperative Corporation: The entity that holds title (fee or an
-----------------------
acceptable leasehold estate) to the real property and improvements
constituting the Cooperative Property and which governs the Cooperative
Property, which Cooperative Corporation must qualify as a Cooperative Housing
Corporation under Section 216 of the Code.
Cooperative Loan: Any Mortgage Loan secured by Cooperative Shares
----------------
and a Proprietary Lease.
Cooperative Loan Documents: As specified in items 9 and 10 of
--------------------------
Exhibit C-1 to the Sale and Servicing Agreement.
Cooperative Property: The real property and improvements owned by
--------------------
the Cooperative Corporation, that includes the allocation of individual
dwelling units to the holders of the Cooperative Shares of the Cooperative
Corporation.
Cooperative Shares: Shares issued by a Cooperative Corporation.
------------------
Cooperative Unit: A single family dwelling located in a Cooperative
----------------
Property.
Corporate Trust Office: The principal corporate trust office of the
----------------------
Trustee at which, at any particular time, its corporate trust business shall
be administered, which office at the date hereof is located at Xxxxx Xxxxxx
xxx Xxxxxxxxx Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx 00000, Attention: Corporate
Trust Services (SASCO 1997-1).
Corresponding Class: None.
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Corresponding Component: None.
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Credit Support Depletion Date: The Distribution Date on which,
----------------------------------
giving effect to all distributions on such date, the aggregate Certificate
Principal Amount of the Subordinate Certificates has been reduced to zero.
Credit Support Percentage: As to any Class of Subordinate
-------------------------
Certificates, and any Distribution Date, the sum of the Class Percentages of
all Classes of Certificates that rank lower in priority than such Class.
Custodial Account: An account or accounts maintained by the Servicer
-----------------
pursuant to the Sale and Servicing Agreement, into which it will deposit
collections and recoveries with respect to the Mortgage Loans.
Custodial Agreement: The custodial agreement between the Trustee and
-------------------
the Custodian, dated as of January 1, 1997, attached hereto as Exhibit K.
Custodian: First Trust National Association, in its capacity as
---------
custodian under the Custodial Agreement, or any successor in interest.
Cut-off Date: January 1, 1997.
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Cut-off Date Aggregate Principal Balance: With respect to the
----------------------------------------
Mortgage Loans in the Trust Fund on the Closing Date, the Aggregate Principal
Balance of all such Mortgage Loans as of the Cut-off Date.
DCR: Duff & Xxxxxx Credit Rating Co., or any successor in interest.
---
Debt Service Reduction: With respect to any Mortgage Loan, a
----------------------
reduction of the Scheduled Payment that the related Mortgagor is obligated to
pay on any Due Date as a result of any proceeding under bankruptcy law or any
similar proceeding.
Deceased Holder: With respect to a Holder of a Redemption
---------------
Certificate, as defined in Section 5.05(b).
Deferred Interest: With respect to any Distribution Date, the
-----------------
aggregate Mortgage Loan Negative Amortization, if any, for the related
Collection Period.
Deficient Valuation: With respect to any Mortgage Loan, a valuation
-------------------
by a court of competent jurisdiction of the Mortgaged Property in an amount
less than the then outstanding indebtedness under such Mortgage Loan, which
valuation results from a proceeding under bankruptcy law or any similar
proceeding.
Definitive Certificate: A Certificate of any Class issued in
----------------------
definitive, fully registered, certificated form.
Deleted Mortgage Loan: A Mortgage Loan that is repurchased from the
---------------------
Trust Fund pursuant to the terms hereof or as to which one or more Qualifying
Substitute Mortgage Loans are substituted therefor.
Depositor: Structured Asset Securities Corporation, a Delaware
---------
corporation having its principal place of business in New York, or its
successors in interest.
Determination Date: With respect to each Distribution Date, the 14th
------------------
day of the month in which such Distribution Date occurs, or, if such 14th day
is not a Business Day, the immediately preceding Business Day.
Discount Mortgage Loan: None.
----------------------
Disqualified Organization: Either (i) the United States, (ii) any
-------------------------
state or political subdivision thereof, (iii) any foreign government, (iv)
any international organization, (v) any agency or instrumentality of any of
the foregoing, (vi) any tax-exempt organization (other than a cooperative
described in section 521 of the Code) which is exempt from the tax imposed by
Chapter 1 of the Code unless such organization is subject to the tax imposed
by section 511 of the Code, (vii) any organization described in section
1381(a)(2)(C) of the Code, or (viii) any other entity designated as a
Disqualified Organization by relevant legislation amending the REMIC
Provisions and in effect at or proposed to be effective as of the time of the
determination. In addition, a corporation will not be treated as an
instrumentality of the United States or of any state or political subdivision
thereof if all of its activities are subject to tax and, with the exception
of the Federal Home Loan Mortgage Corporation, a majority of its board of
directors is not selected by such governmental unit.
Distribution Date: The 15th day of each month or, if such day is not
-----------------
a Business Day, the next succeeding Business Day, commencing in February
1997.
Due Date: With respect to any Mortgage Loan, the date on which a
--------
Scheduled Payment is due under the related Mortgage Note.
Due Period: With respect to any Distribution Date, the period
----------
commencing on the second day of the month immediately preceding the month in
which such Distribution Date occurs and ending on the first day of the month
in which such Distribution Date occurs.
Eligible Account: Either (i) an account or accounts maintained with
----------------
a federal or state chartered depository institution or trust company
acceptable to the Rating Agencies or (ii) an account or accounts the deposits
in which are insured by the FDIC to the limits established by such
corporation, provided that any such deposits not so insured shall be
maintained in an account at a depository institution or trust company whose
commercial paper or other short term debt obligations (or, in the case of a
depository institution or trust company which is the principal subsidiary of
a holding company, the commercial paper or other short term debt or deposit
obligations of such holding company or depository institution, as the case
may be) have been rated by each Rating Agency in its highest short-term
rating category, or (iii) a segregated trust account or accounts (which shall
be a "special deposit account") maintained with the Trustee or any other
federal or state chartered depository institution or trust company, acting in
its fiduciary capacity, in a manner acceptable to the Trustee and the Rating
Agencies. Eligible Accounts may bear interest.
Eligible Investments: Any one or more of the following obligations
--------------------
or securities:
(i) direct obligations of, and obligations fully guaranteed as to
timely payment of principal and interest by, the United States of
America or any agency or instrumentality of the United States of America
the obligations of which are backed by the full faith and credit of the
United States of America ("Direct Obligations");
(ii) federal funds, or demand and time deposits in, certificates of
deposits of, or bankers' acceptances issued by, any depository
institution or trust company (including U.S. subsidiaries of foreign
depositories and the Trustee or any agent of the Trustee, acting in its
respective commercial capacity) incorporated or organized under the laws
of the United States of America or any state thereof and subject to
supervision and examination by federal or state banking authorities, so
long as at the time of investment or the contractual commitment
providing for such investment the commercial paper or other short-term
debt obligations of such depository institution or trust company (or, in
the case of a depository institution or trust company which is the
principal subsidiary of a holding company, the commercial paper or other
short-term debt or deposit obligations of such holding company or
deposit institution, as the case may be) have been rated by each Rating
Agency in its highest short-term rating category or one of its two
highest long-term rating categories;
(iii) repurchase agreements collateralized by Direct Obligations or
securities guaranteed by GNMA, FNMA or FHLMC with any registered
broker/dealer subject to Securities Investors' Protection Corporation
jurisdiction or any commercial bank insured by the FDIC, if such
broker/dealer or bank has an uninsured, unsecured and unguaranteed
obligation rated by each Rating Agency in its highest short-term rating
category;
(iv) securities bearing interest or sold at a discount issued by
any corporation incorporated under the laws of the United States of
America or any state thereof which have a credit rating from each Rating
Agency, at the time of investment or the contractual commitment
providing for such investment, at least equal to one of the two highest
long-term credit rating categories of each Rating Agency; provided,
however, that securities issued by any particular corporation will not
be Eligible Investments to the extent that investment therein will cause
the then outstanding principal amount of securities issued by such
corporation and held as part of the Trust Fund to exceed 20% of the sum
of the Aggregate Principal Balance and the aggregate
principal amount of all Eligible Investments in the Certificate Account;
provided, further, that such securities will not be Eligible Investments
if they are published as being under review with negative implications
from either Rating Agency;
(v) commercial paper (including both noninterest-bearing discount
obligations and interest-bearing obligations payable on demand or on a
specified date not more than 180 days after the date of issuance
thereof) rated by each Rating Agency in its highest short-term rating
category;
(vi) a Qualified GIC;
(vii) certificates or receipts representing direct ownership
interests in future interest or principal payments on obligations of the
United States of America or its agencies or instrumentalities (which
obligations are backed by the full faith and credit of the United States
of America) held by a custodian in safekeeping on behalf of the holders
of such receipts; and
(viii) any other demand, money market, common trust fund or time
deposit or obligation, or interest-bearing or other security or
investment, (A) rated in the highest rating category by each Rating
Agency or (B) that would not adversely affect the then current rating by
either Rating Agency of any of the Certificates;
provided, however, that no such instrument shall be an Eligible Investment
-------- -------
if such instrument evidences either (i) a right to receive only interest
payments with respect to the obligations underlying such instrument, or (ii)
both principal and interest payments derived from obligations underlying such
instrument and the principal and interest payments with respect to such
instrument provide a yield to maturity of greater than 120% of the yield to
maturity at par of such underlying obligations, provided that any such
investment will be a "permitted investment" within the meaning of Section
860G(a)(5) of the Code.
ERISA-Restricted Certificate: Any Subordinate Certificate.
----------------------------
Event of Default: An event described in Section 9.01 of the Sale and
----------------
Servicing Agreement, which pursuant to such agreement is a default by the
Servicer and entitles the Trustee to terminate such Servicer.
Excess Loss: Any Bankruptcy Loss, or portion thereof, in excess of
-----------
the then-applicable Bankruptcy Loss Limit, any Fraud Loss, or portion
thereof, in excess of the then-applicable Fraud Loss Limit, and any Special
Hazard Loss, or portion thereof, in excess of the then-applicable Special
Hazard Loss Limit.
FDIC: The Federal Deposit Insurance Corporation or any successor
----
thereto.
FHLMC: The Federal Home Loan Mortgage Corporation, a corporate
-----
instrumentality of the United States created and existing under Title III of
the Emergency Home Finance Act of 1970, as amended, or any successor thereto.
Final Scheduled Distribution Date: November 15, 2026.
---------------------------------
Financial Intermediary: A broker, dealer, bank or other financial
----------------------
institution or other Person that clears through or maintains a custodial
relationship with a Clearing Agency Participant.
Fitch: Fitch Investors Service, L.P., or any successor in interest.
-----
FNMA: The Federal National Mortgage Association, a federally
----
chartered and privately owned corporation organized and existing under the
Federal National Mortgage Association Charter Act, or any successor thereto.
Fraud Loss: Any Realized Loss on a Mortgage Loan sustained by reason
----------
of a default arising from fraud, dishonesty or misrepresentation in
connection with the related Mortgage Loan.
Fraud Loss Limit: As of the Cut-off Date, $1,714,309, which amount
----------------
shall be reduced (i) by the amount of Fraud Losses allocated to the
Certificates; (ii) on the first and second anniversaries of the Cut-off Date,
to an amount equal to the excess of 1% of the Cut-off Date Balance of the
Mortgage Loans over the cumulative amount of Fraud Losses allocated to the
Certificates, (iii) on the third and fourth anniversaries of the Cut-off
Date, to an amount equal to the excess of 0.5% of the Cut-off Date Balance of
the Mortgage Loans over the cumulative amount of Fraud Losses allocated to
the Certificates, and (iv) on the fifth anniversary of the Cut-off Date, to
zero.
GNMA: The Government National Mortgage Association, a wholly owned
----
corporate instrumentality of the United States within HUD.
Holder or Certificateholder: The registered owner of any Certificate
------ -----------------
as recorded on the books of the Certificate Registrar except that, solely for
the purposes of taking any action or giving any consent pursuant to this
Agreement, any Certificate registered in the name of the Depositor, the
Servicer, the Trustee or any Affiliate thereof shall be deemed not to be
outstanding in determining whether the requisite percentage necessary to
effect any such consent has been obtained, except that, in determining
whether the Trustee shall be protected in relying upon any such consent, only
Certificates which a Responsible Officer of the Trustee knows to be so owned
shall be disregarded. The Trustee may request and conclusively rely on
certifications by the Depositor or the Servicer in determining whether any
Certificates are registered to an Affiliate of the Depositor or the Servicer.
HUD: The United States Department of Housing and Urban Development,
---
or any successor thereto.
Independent: When used with respect to any Accountants, a Person who
-----------
is "independent" within the meaning of Rule 2-01(b) of the Securities and
Exchange Commission's Regulation S-X. When used with respect to any other
Person, a Person who (a) is in fact independent of another specified Person
and any Affiliate of such other Person, (b) does not have any material direct
financial interest in such other Person or any Affiliate of such other
Person, and (c) is not connected with such other Person or any Affiliate of
such other Person as an officer, employee, promoter, underwriter, trustee,
partner, director or Person performing similar functions.
Individual Redemption Certificate: A Redemption Certificate with a
---------------------------------
$1,000 Certificate Principal Amount.
Initial LIBOR Rate: None.
------------------
Insurance Policy: Any Primary Mortgage Insurance Policy and any
----------------
standard hazard insurance policy, flood insurance policy, earthquake
insurance policy or title insurance policy relating to the Mortgage Loans or
the Mortgaged Properties, to be in effect as of the Closing Date or
thereafter during the term of this Agreement.
Insurance Proceeds: Amounts paid by the insurer under any Insurance
------------------
Policy, other than amounts to be applied to restoration or repair of the
related Mortgaged Property or required to be paid over to the Mortgagor
pursuant to law or the related Mortgage Note.
Interest Accrual Period: With respect to any Distribution Date and
-----------------------
any Class of Certificates (other than any Class of LIBOR Certificates or
Principal Only Certificates) or Component, the one-month period beginning
immediately following the end of the preceding Interest Accrual Period (or
from the Cut-off Date, in the case of the first Interest Accrual Period) and
ending on the last day of the month preceding the month in which such
Distribution Date occurs. With respect to any Distribution Date and any
Class of LIBOR Certificates, the one-month period beginning on the 25th day
of the preceding month and ending on the 24th day of the month in which such
Distribution Date occurs.
Interest Distribution Amount: Not applicable.
----------------------------
Interest Shortfall: With respect to any Class of Certificates and
------------------
any Distribution Date, any Accrued Certificate Interest (net of any Net
Prepayment Interest Shortfalls allocable to such Class) not paid with respect
to a previous Distribution Date.
Intervening Assignments: The original intervening assignments of the
-----------------------
Mortgage, notice of transfer or equivalent instrument.
Latest Possible Maturity Date: November 15, 2028.
-----------------------------
Xxxxxx Capital: Xxxxxx Capital, A Division of Xxxxxx Brothers
--------------
Holdings Inc., or any successor in interest.
LIBOR: The per annum rate determined, pursuant to Section 4.05, on
-----
the basis of London interbank offered rate quotations for one-month
Eurodollar deposits, as such quotations may appear on the display designated
as page "LIUS01M" on the Bloomberg Financial Markets Commodities News (or
such other page as may replace such page on that service for the purpose of
displaying London interbank offered quotations of major banks).
LIBOR Certificate: None.
-----------------
LIBOR Determination Date: The second London Business Day immediately
------------------------
preceding the commencement of each Interest Accrual Period for any LIBOR
Certificates.
Liquidated Mortgage Loan: Any defaulted Mortgage Loan as to which
------------------------
the Servicer has determined that all amounts that it expects to recover on
behalf of the Trust Fund from or on account of such Mortgage Loan have been
recovered.
Liquidation Proceeds: As defined in the Sale and Servicing
--------------------
Agreement.
Living Holder: Any Holder of a Redemption Certificate other than a
-------------
Deceased Holder.
Loan-to-Value Ratio: With respect to any Mortgage Loan, the ratio of
-------------------
the principal balance of such Mortgage Loan at origination, or such other
date as is specified, to the Original Value thereof.
London Business Day: Any day on which banks are open for dealing in
-------------------
foreign currency and exchange in London, England and New York City.
Maintenance: With respect to any Cooperative Unit, the rent or fee
-----------
paid by the Mortgagor to the Cooperative Corporation pursuant to the
Proprietary Lease.
Material Defect: As defined in the Sale and Servicing Agreement.
---------------
Moody's: Xxxxx'x Investors Service, or any successor in interest.
-------
Mortgage: A mortgage, deed of trust or other instrument encumbering
--------
a fee simple interest in real property securing a Mortgage Note, together
with improvements thereto.
Mortgage File: The mortgage documents listed in Exhibit B to the
-------------
Sale and Servicing Agreement pertaining to a particular Mortgage Loan
required to be delivered to the Trustee pursuant to this Agreement.
Mortgage Loan: A Mortgage and the related notes or other evidences
-------------
of indebtedness secured by each such Mortgage conveyed, transferred, sold,
assigned to or deposited with the Trustee pursuant to Section 2.01 or Section
2.05, including without limitation, each Mortgage Loan listed on the Mortgage
Loan Schedule, as amended from time to time.
Mortgage Loan Negative Amortization: None.
-----------------------------------
Mortgage Loan Sale and Assignment Agreement: The agreement for the
-------------------------------------------
sale of the Mortgage Loans by Xxxxxx Capital to the Depositor and the
assignment to the Depositor of the rights of Xxxxxx Capital under the Sale
and Servicing Agreement, between Xxxxxx Capital, as seller and assignor, and
the Depositor, as purchaser and assignee.
Mortgage Loan Schedule: The schedule attached hereto as Schedule A,
----------------------
which shall identify each Mortgage Loan, as such schedule may be amended from
time to time to reflect the addition of Mortgage Loans to, or the deletion of
Mortgage Loans from, the Trust Fund.
Mortgage Note: The note or other evidence of the indebtedness of a
-------------
Mortgagor secured by a Mortgage under a Mortgage Loan.
Mortgage Rate: As to any Mortgage Loan, the per annum rate at which
-------------
interest accrues on such Mortgage Loan.
Mortgaged Property: Either of (x) the fee simple interest in real
------------------
property, together with improvements thereto including any exterior
improvements to be completed within 120 days of disbursement of the related
Mortgage Loan proceeds, or (y) in the case of a Cooperative Loan, the related
Cooperative Shares and Proprietary Lease, securing the indebtedness of the
Mortgagor under the related Mortgage Loan.
Mortgagor: The obligor on a Mortgage Note.
---------
Net Mortgage Rate: With respect to any Mortgage Loan, the Mortgage
-----------------
Rate thereof reduced by the Servicing Fee Rate and the Trustee Fee Rate.
Net Prepayment Interest Shortfall: With respect to any Distribution
---------------------------------
Date, the excess, if any, of any Prepayment Interest Shortfalls for such date
over any amount that is required under the Sale and Servicing Agreement to be
paid by the Servicer in respect of such shortfalls. Any Net Prepayment
Interest Shortfall shall be allocated among all Classes of Certificates
(other than any Class of Principal Only Certificates) and among the
Components (other than any Principal Only Component) of any Component
Certificate in proportion to the respective amounts of Accrued Certificate
Interest otherwise distributable thereon.
Non-Book-Entry Certificate: Any Certificate other than a Book-Entry
--------------------------
Certificate.
Notional Amount: With respect to any Notional Certificate and any
---------------
Distribution Date, such Certificate's Percentage Interest of the Aggregate
Notional Amount of such Class of Certificates for such Distribution Date.
Notional Certificate: None.
--------------------
Notional Component: None.
------------------
Notional Component Amount: None.
-------------------------
Offering Document: Either of the Prospectus or the private placement
-----------------
memorandum dated January 23, 1997 relating to the Class B4, Class B5 and
Class B6 Certificates.
Officer's Certificate: A certificate signed by the Chairman of the
---------------------
Board, any Vice Chairman, the President, any Vice President or any Assistant
Vice President of a Person, and in each case delivered to the Trustee.
Opinion of Counsel: A written opinion of counsel, reasonably
------------------
acceptable in form and substance to the Trustee, and who may be in-house or
outside counsel to the Depositor or the Servicer but which must be
Independent outside counsel with respect to any such opinion of counsel
concerning the transfer of any Residual Certificate or concerning certain
matters with respect to the Employee Retirement Income Security Act of 1974,
as amended ("ERISA"), or the taxation, or the federal income tax status, of
each REMIC.
Original Credit Support Percentage: With respect to the Class B1
----------------------------------
Certificates, 2.50%; with respect to the Class B2 Certificates, 1.75%; with
respect to the Class B3 Certificates, 1.25%; with respect to the Class B4
Certificates, 0.60%; with respect to the Class B5 Certificates, 0.30%.
Original Subordinate Principal Amount: The aggregate Certificate
-------------------------------------
Principal Amount of the Subordinate Certificates as of the Closing Date.
Original Value: The lesser of (a) the Appraised Value of a Mortgaged
--------------
Property at the time the related Mortgage Loan was originated and (b) if the
Mortgage Loan was made to finance the acquisition of the related Mortgaged
Property, the purchase price paid for the Mortgaged Property by the Mortgagor
at the time the related Mortgage Loan was originated.
PAC Amount: As to any Distribution Date and any Class of PAC
----------
Certificates and any PAC Component, the amount designated as such for such
Distribution Date and such Class or Component as set forth in the Principal
Amount Schedules.
PAC Certificate: None.
---------------
PAC Component: None.
-------------
Paying Agent: Any paying agent appointed pursuant to Section 3.08.
------------
Percentage Interest: With respect to any Certificate, its percentage
-------------------
interest in the undivided beneficial ownership interest in the Trust Fund
evidenced by all Certificates of the same Class as such Certificate. With
respect to any Certificate, the Percentage Interest evidenced thereby shall
equal the initial Certificate Principal Amount (or, in the case of a Notional
Certificate, the initial Notional Amount) thereof divided by the initial
Class Certificate Principal Amount (or, in the case of a Notional
Certificate, the initial Aggregate Notional Amount) of all Certificates of
the same Class.
Person: Any individual, corporation, partnership, joint venture,
------
association, joint-stock company, limited liability company, trust,
unincorporated organization or government or any agency or political
subdivision thereof.
Placement Agent: Xxxxxx Brothers Inc.
---------------
Plan Asset Regulations: The Department of Labor regulations set
----------------------
forth in 29 C.F.R. 2510.3-101.
Premium Mortgage Loan: None.
---------------------
Prepayment Interest Shortfall: With respect to any full or partial
-----------------------------
Principal Prepayment of a Mortgage Loan, the difference between (i) one full
month's interest at the applicable Mortgage Rate (giving effect to any
applicable Relief Act Reduction), as reduced by the Servicing Fee Rate, on
the Scheduled Principal Balance of such Mortgage Loan immediately prior to
such prepayment and (ii) the amount of interest actually received with
respect to such Mortgage Loan in connection with such Principal Prepayment.
Prepayment Period: With respect to any Distribution Date, the
-----------------
calendar month preceding the month in which such Distribution Date occurs.
Primary Mortgage Insurance Policy: Mortgage guaranty insurance, if
---------------------------------
any, on an individual Mortgage Loan, as evidenced by a policy or certificate.
Principal Amount Schedules: Any principal amount schedules attached
--------------------------
hereto, if applicable, as Schedule B, setting forth the PAC Amounts of any
PAC Certificates and PAC Components, the TAC Amounts of any TAC Certificates
and TAC Components, and the Scheduled Amounts of any Scheduled Certificates
and Scheduled Components.
Principal Distribution Amount: With respect to any Distribution
-----------------------------
Date, the sum of the Senior Principal Distribution Amount for such date and
the Subordinate Principal Distribution Amount for such date.
Principal Only Certificate: None.
--------------------------
Principal Prepayment: Any Mortgagor payment of principal or other
--------------------
recovery of principal on a Mortgage Loan that is recognized as having been
received or recovered in advance of its scheduled Due Date and applied to
reduce the principal balance of the Mortgage Loan in accordance with the
terms of the Mortgage Note or Accepted Servicing Practices.
Proceeding: Any suit in equity, action at law or other judicial or
----------
administrative proceeding.
Proprietary Lease: With respect to any Cooperative Unit, a lease or
-----------------
occupancy agreement between a Cooperative Corporation and a holder of related
Cooperative Shares.
Prospectus: The prospectus supplement dated January 23, 1997,
----------
together with the accompanying prospectus dated May 21, 1996, relating to the
Class A, Class B1, Class B2, Class B3 and Class R Certificates.
Purchase Price: With respect to the repurchase of a Mortgage Loan
--------------
pursuant to Article II of this Agreement, an amount equal to the sum of (a)
100% of the unpaid principal balance of such Mortgage Loan and (b) accrued
interest thereon at the Mortgage Rate, from the date as to which interest was
last paid to (but not including) the Due Date immediately preceding the
related Distribution Date. The Servicer (and the Trustee, if applicable)
shall be reimbursed from the Purchase Price for any Advances made with
respect to any Mortgage Loan or related Mortgage Property that are
reimbursable to the Servicer under the Sale and Servicing Agreement (or to
the Trustee hereunder).
Qualified GIC: A guaranteed investment contract or surety bond
-------------
providing for the investment of funds in the Collection Account or the
Certificate Account and insuring a minimum, fixed or floating rate of return
on investments of such funds, which contract or surety bond shall:
(a) be an obligation of an insurance company or other corporation
whose long-term debt is rated by each Rating Agency in one of its two
highest rating categories or, if such insurance company has no long-term
debt, whose claims paying ability is rated by each Rating Agency in one
of its two highest rating categories, and whose short-term debt is rated
by each Rating Agency in its highest rating category;
(b) provide that the Trustee may exercise all of the rights under
such contract or surety bond without the necessity of taking any action
by any other Person;
(c) provide that if at any time the then current credit standing
of the obligor under such guaranteed investment contract is such that
continued investment pursuant to such contract of funds would result in
a downgrading of any rating of the Certificates, the Trustee shall
terminate such contract without penalty and be entitled to the return of
all funds previously invested thereunder, together with accrued interest
thereon at the interest rate provided under such contract to the date of
delivery of such funds to the Trustee;
(d) provide that the Trustee's interest therein shall be
transferable to any successor trustee hereunder: and
(e) provide that the funds reinvested thereunder and accrued
interest thereon be returnable to the Collection
Account or the Certificate Account, as the case may be, not later than
the Business Day prior to any Distribution Date.
Qualified Insurer: An insurance company duly qualified as such under
-----------------
the laws of the states in which the related Mortgaged Properties are located,
duly authorized and licensed in such states to transact the applicable
insurance business and to write the insurance provided and whose claims
paying ability is rated by each Rating Agency in its highest rating category
or whose selection as an insurer will not adversely affect the rating of the
Certificates.
Qualifying Substitute Mortgage Loan: A "Qualified Substitute
-----------------------------------
Mortgage Loan" as defined in the Sale and Servicing Agreement. Whenever a
Qualifying Substitute Mortgage Loan is substituted for a Deleted Mortgage
Loan pursuant to this Agreement, the party effecting such substitution shall
certify such qualification in writing to the Trustee.
Rating Agency: Each of Fitch and S&P; provided, that with respect to
-------------
the Class B4 and Class B5 Certificates, S&P will be the sole Rating Agency.
Realized Loss: (a) with respect to each Liquidated Mortgage Loan, an
-------------
amount equal to (i) the unpaid principal balance of such Mortgage Loan as of
the date of liquidation, plus (ii) interest at the applicable Net Mortgage
Rate from the date as to which interest was last paid up to the last day of
the month of such liquidation, minus (iii) Liquidation Proceeds received, net
of amounts that are reimbursable to the Servicer with respect to such
Mortgage Loan (other than Advances of principal and interest), including
expenses of liquidation, and (b) with respect to each Mortgage Loan that has
become the subject of a Deficient Valuation, the difference between the
unpaid principal balance of such Mortgage Loan immediately prior to such
Deficient Valuation and the unpaid principal balance of such Mortgage Loan as
reduced by such Deficient Valuation. In determining whether a Realized Loss
is a Realized Loss of interest or principal, Liquidation Proceeds shall be
allocated, first, to payment of expenses related to such Liquidated Mortgage
Loan, then to accrued unpaid interest and finally to reduce the principal
balance of the Mortgage Loan.
Recognition Agreement: With respect to any Cooperative Loan, an
---------------------
agreement between the related Cooperative Corporation and the originator of
such Mortgage Loan to establish the rights of such originator in the related
Cooperative Property.
Record Date: With respect to any Distribution Date, the close of
-----------
business on the last Business Day of the month immediately preceding the
month in which such Distribution Date occurs.
Redemption Certificate: None.
----------------------
Reference Banks: As defined in Section 4.05.
---------------
Relief Act Reduction: With respect to any Mortgage Loan as to which
--------------------
there has been a reduction in the amount of interest collectible thereon as a
result of application of the Solders' and Sailors' Civil Relief Act of 1940,
as amended, any amount by which interest collectible on such Mortgage Loan
for the Due Date in the related Collection Period is less than interest
accrued thereon for the applicable one-month period at the Mortgage Rate
without giving effect to such reduction.
REMIC: Each pool of assets in the Trust Fund designated as a REMIC
-----
pursuant to Section 10.01(a) hereof.
REMIC Provisions: The provisions of the federal income tax law
-----
relating to real estate mortgage investment conduits, which appear at
sections 860A through 86OG of Subchapter M of Chapter 1 of the Code, and
related provisions, and regulations, including proposed regulations and
rulings, and administrative pronouncements promulgated thereunder, as the
foregoing may be in effect from time to time.
Remittance Date: The day in each month on which the Servicer is
---------------
required to remit payments to the account maintained by the Trustee, which
shall be the 14th day of each month (or the immediately preceding Business
Day, if such 14th day is not a Business Day).
REO Property: A Mortgaged Property acquired by the Trust Fund
------------
through foreclosure or deed-in-lieu of foreclosure in connection with a
defaulted Mortgage Loan or otherwise treated as having been acquired pursuant
to the REMIC Provisions.
Reserve Interest Rate: As defined in Section 4.05.
---------------------
Residual Certificate: Any Class R Certificate.
--------------------
Responsible Officer: When used with respect to the Trustee, any Vice
-------------------
President, Assistant Vice President, the Secretary, any assistant secretary,
the Treasurer, or any assistant treasurer, working in its corporate trust
department, or any other officer of the Trustee to whom a matter is referred
because of such officer's knowledge of and familiarity with the particular
subject.
Restricted Certificate: Any Class B4, Class B5 or Class B6
----------------------
Certificate.
Rounding Account: None.
----------------
S&P: Standard & Poor's Rating Services, a division of The
---
XxXxxx-Xxxx Companies, Inc., or any successor in interest.
Sale and Servicing Agreement: The Sale and Servicing Agreement
----------------------------
between The Boston Company and Xxxxxx Capital, dated as of January 1, 1997,
attached hereto as Exhibit E.
Scheduled Amount: As to any Distribution Date and any Class of
----------------
Scheduled Certificates and any Scheduled Component, the amount designated as
such for such Distribution Date and such Class or Component as set forth in
the Principal Amount Schedules.
Scheduled Certificate: None.
---------------------
Scheduled Component: None.
-------------------
Scheduled Payment: Each scheduled payment of principal and interest
-----------------
(or of interest only, if applicable) to be paid by the Mortgagor on a
Mortgage Loan, as reduced (except where otherwise specified herein) by the
amount of any related Debt Service Reduction (excluding all amounts of
principal and interest that were due on or before the Cut-off Date whenever
received) and, in the case of an REO Property, an amount equivalent to the
Scheduled Payment that would have been due on the related Mortgage Loan if
such Mortgage Loan had remained in existence.
Scheduled Principal Amount: As to any Distribution Date, an amount
-------------------------------
equal to the amount described in clause (i)(b) of the definition of Senior
Principal Distribution Amount.
Scheduled Principal Balance: (i) with respect to any Mortgage Loan
---------------------------
as of any Distribution Date, the principal balance of such Mortgage Loan at
the close of business on the Cut-off Date, after giving effect to principal
payments due on or before the Cut-off Date, whether or not received, less an
amount equal to principal payments due after the Cut-off Date and on or
before the Due Date in the related Due Period, whether or not received from
the Mortgagor or advanced by the Servicer, and all amounts allocable to
unscheduled principal payments (including Principal Prepayments, Liquidation
Proceeds, Insurance Proceeds and condemnation proceeds, in each case to the
extent identified and applied prior to or during the Prepayment Period ending
in the month prior to the month of such Distribution Date) and (ii) with
respect to any REO Property as of any Distribution Date, the Scheduled
Principal Balance of the related Mortgage Loan on the Due Date immediately
preceding the date of acquisition of such REO Property by the Trustee
(reduced by any amount applied as a reduction of principal on the Mortgage
Loan).
Security Agreement: With respect to any Cooperative Loan, the
------------------
agreement between the owner of the related Cooperative Shares and the
originator of the related Mortgage Note that defines the terms of the
security interest in such Cooperative Shares and the related Proprietary
Lease.
Senior Certificate: Any Class A or Class R Certificate.
------------------
Senior Percentage: With respect to any Distribution Date, the
-----------------
percentage equivalent of the fraction, the numerator of which is the
aggregate Certificate Principal Amount of the Senior Certificates immediately
prior to such date and the denominator of which is the sum of the aggregate
Certificate Principal Amount of all Classes of Certificates immediately prior
to such date.
Senior Prepayment Percentage: With respect to any Distribution Date
----------------------------
occurring during the ten years beginning on the first Distribution Date,
100%. The Senior Prepayment Percentage for any Distribution Date occurring
on or after the tenth anniversary of the first Distribution Date will be the
Senior Percentage plus the following percentage of the Subordinate Percentage
for such Distribution Date: for any Distribution Date in the first year
thereafter, 70%; for any Distribution Date in the second year thereafter,
60%; for any Distribution Date in the third year thereafter, 40%; for any
Distribution Date in the fourth year thereafter, 20%; and for any subsequent
Distribution Date, 0%; provided, however, that if on any of the foregoing
Distribution Dates the Senior Percentage exceeds the initial Senior
Percentage, the Senior Prepayment Percentage for such Distribution Date will
once again equal 100%.
Notwithstanding the foregoing, except as provided in the next succeeding
paragraph, no decrease in the Senior Prepayment Percentage below the level in
effect for the most recent prior period set forth in the paragraph above
shall be effective on any Distribution Date if, as of the first Distribution
Date as to which any such decrease applies, (i) the average outstanding
principal balance on such Distribution Date and for the preceding five
Distribution Dates of all Mortgage Loans that were delinquent 60 days or more
(including for this purpose any Mortgage Loans in foreclosure and the
Scheduled Payments that would have been due on Mortgage Loans with respect to
which the related Mortgaged Property has been acquired by the Trust Fund if
the related Mortgage Loan had remained in existence) is greater than or equal
to 50% of the aggregate of the Class Certificate Principal Amounts of the
Subordinate Certificates immediately prior to such Distribution Date or (ii)
cumulative Realized Losses with respect to the Mortgage Loans exceed (a) with
respect to the Distribution Date on the tenth anniversary of the first
Distribution Date, 30% of the aggregate of the Original Subordinate Principal
Amount, (b) with respect to the Distribution Date on the eleventh anniversary
of the first Distribution Date, 35% of the Original Subordinate Principal
Amount, (c) with respect to the Distribution Date on the twelfth anniversary
of the first Distribution Date, 40% of the Original Subordinate Principal
Amount, (d) with respect to the Distribution Date on the thirteenth
anniversary of the first Distribution Date, 45% of the Original Subordinate
Principal Amount, and (e) with respect to the Distribution Date on the
fourteenth anniversary of the first Distribution Date, 50% of the Original
Subordinate Principal Amount.
Notwithstanding the foregoing, if on any Distribution Date (i) the
Subordinate Percentage for such date equals at least twice the Subordinate
Percentage for the first Distribution Date, (ii) cumulative Realized Losses
with respect to the Mortgage Loans have not exceeded 30% of the Original
Subordinate Principal Balance, and (iii) not more than an average of 2% of
the dollar amount of all Scheduled Payments on the Mortgage Loans due in each
of preceding twelve months were delinquent 60 days or more (including for
this purpose any Mortgage Loans in foreclosure and the Scheduled Payments
that would have been due on Mortgage Loans with respect to which the related
Mortgaged Property has been acquired by the Trust Fund if the related
Mortgage Loan had remained in existence), then the Senior Prepayment
Percentage for such Distribution Date will be as follows: (A) as to any
Distribution Date prior to the third anniversary of the first Distribution
Date, the sum of (i) the Senior Percentage for such Distribution Date and
(ii) 50% of the Subordinate Percentage for such Distribution Date; or (B) as
to any Distribution Date on or after the third anniversary of the first
Distribution Date, the Senior Percentage for such Distribution Date.
Senior Principal Distribution Amount: For any Distribution Date, the
------------------------------------
sum of the following amounts:
(i) the product of (a) the Senior Percentage for such date and (b)
the principal portion of each Scheduled Payment (without giving effect
to any Debt Service Reduction occurring prior to the Bankruptcy Coverage
Termination Date) on a Mortgage Loan due during the related Due Period;
(ii) the product of (a) the Senior Prepayment Percentage for such
date and (b) each of the following amounts: (1) each Principal
Prepayment on the Mortgage Loans collected during the related Prepayment
Period, (2) each other unscheduled collection, including Insurance
Proceeds and Liquidation Proceeds (other than with respect to any
Mortgage Loan that was finally liquidated during the related Prepayment
Period), representing or allocable to recoveries of principal received
during the related Prepayment Period, and (3) the principal portion of
all proceeds of the purchase of any Mortgage Loan (or, in the case of a
permitted substitution, amounts representing a principal adjustment)
actually received by the Trustee during the related Prepayment Period;
(iii) with respect to unscheduled recoveries allocable to principal
of any Mortgage Loan that was finally liquidated during the related
Prepayment Period, the lesser of (a) the related net Liquidation
Proceeds allocable to principal and (b) the product of the Senior
Prepayment Percentage for such date and the Scheduled Principal Balance
of such Mortgage Loan at the time of liquidation; and
(iv) any amounts described in clauses (i) through (iii) for any
previous Distribution Date that remain unpaid.
Servicer: The Boston Company, as servicer under the Sale and
--------
Servicing Agreement, or any successor in interest.
Servicing Advance: As defined in the Sale and Servicing Agreement.
-----------------
Servicing Fee: As defined in the Sale and Servicing Agreement.
-------------
Servicing Fee Rate: 0.25% per annum.
------------------
Servicing Officer: Any officer of the Servicer involved in or
-----------------
responsible for the administration and servicing of the Mortgage Loans whose
name appears on a list of servicing officers furnished by the Servicer to the
Trustee, as such list may be amended from time to time.
Special Hazard Loss: With respect to the Mortgage Loans, (x) any
-------------------
Realized Loss arising out of any direct physical loss or damage to a
Mortgaged Property which is caused by or results from any cause, exclusive of
any loss covered by a hazard policy or a flood insurance policy required to
be maintained in respect of such Mortgaged Property and any loss caused by or
resulting from (i) normal wear and tear, (ii) conversion or other dishonest
act on the part of the Trustee, the Servicer or any of their agents or
employees, or (iii) errors in design, faulty workmanship or faulty materials,
unless the collapse of the property or a part thereof ensues, or (y) any
Realized Loss arising from or related to the presence or suspected presence
of hazardous wastes or hazardous substances on a Mortgaged Property unless
such loss is covered by a hazard policy or flood insurance policy required to
be maintained in respect of such Mortgaged Property.
Special Hazard Loss Limit: As of the Cut-off Date, $3,500,000, which
-------------------------
amount shall be reduced from time to time to an amount equal on any
Distribution Date to the lesser of (a) the greatest of (i) 1% of the
aggregate of the Scheduled Principal Balances of the Mortgage Loans; (ii)
twice the Scheduled Principal Balance of the Mortgage Loan having the highest
Scheduled Principal Balance, and (iii) the aggregate Scheduled Principal
Balances of the Mortgage Loans secured by Mortgaged Properties located in the
single California postal zip code area having the highest aggregate Scheduled
Principal Balance of Mortgage Loans of any such postal zip code area and (b)
the Special Hazard Loss Limit as of the Closing Date less the amount of
Special Hazard Losses incurred since the Closing Date.
Startup Day: The day designated as such pursuant to Section 10.01(b)
-----------
hereof.
Subordinate Certificate: Any Class B Certificate.
-----------------------
Subordinate Certificate Writedown Amount: As to any Distribution
----------------------------------------
Date, the amount by which (i) the sum of the Class Certificate Principal
Amounts of all the Certificates (after giving effect to the distribution of
principal and the application of Realized Losses in reduction of the
Certificate Principal Amounts of the Certificates on such Distribution Date)
exceeds (ii) the aggregate Scheduled Principal Balance of the Mortgage Loans
on the first day of the month of such Distribution Date.
Subordinate Class Percentage: With respect to any Distribution Date
----------------------------
and any Class of Subordinate Certificates, the percentage obtained by
dividing the Class Certificate Principal Amount of such Class immediately
prior to such Distribution Date by the sum of the Certificate Principal
Amounts of all Subordinate Certificates immediately prior to such date.
Subordinate Percentage: With respect to any Distribution Date, the
----------------------
difference between 100% and the Senior Percentage for such Distribution Date.
Subordinate Prepayment Percentage: With respect to any Distribution
---------------------------------
Date, the difference between 100% and the Senior Prepayment Percentage for
such Distribution Date.
Subordinate Principal Distribution Amount: For any Distribution
-----------------------------------------
Date, the sum of the following:
(i) the product of (a) the Subordinate Percentage for such date
and (b) the principal portion of each Scheduled Payment (without giving
effect to any Debt Service Reduction occurring prior to the Bankruptcy
Coverage Termination Date) on a Mortgage Loan due during the related Due
Period;
(ii) the product of (a) the related Subordinate Prepayment
Percentage for such date and (b) each of the following amounts: (1)
each Principal Prepayment on the Mortgage Loans collected during the
related Prepayment Period, (2) each other unscheduled collection,
including Insurance Proceeds and net Liquidation Proceeds (other than
with respect to any Mortgage Loan that was finally liquidated
during the related Prepayment Period), representing or allocable to
recoveries of principal received during the related Prepayment
Period, and (3) the principal portion of all proceeds of the
purchase of any Mortgage Loan (or, in the case of a permitted
substitution, amounts representing a principal adjustment) actually
received by the Trustee during the related Prepayment Period;
(iii) with respect to unscheduled recoveries allocable to principal
of any Mortgage Loan that was finally liquidated during the related
Prepayment Period, the related net Liquidation Proceeds allocable to
principal less any related amount paid pursuant to subsection (iii) of
the definition of Senior Principal Distribution Amount; and
(iv) any amounts described in clauses (i) through (iii) for any
previous Distribution Date that remain unpaid.
TAC Amount: As to any Distribution Date and any Class of TAC
----------
Certificates and any TAC Component, the amount designated as such for such
Distribution Date and such Class or Component as set forth in the Principal
Amount Schedules.
TAC Certificate: None.
---------------
TAC Component: None.
-------------
Tax Matters Person: The "tax matters person" as defined in the REMIC
------------------
Provisions.
Termination Price: As defined in Section 7.01 hereof.
-----------------
The Boston Company: Boston Safe Deposit and Trust Company, or any
------------------
successor in interest.
Title Insurance Policy: A title insurance policy maintained with
----------------------
respect to a Mortgage Loan.
Trust Fund: The corpus of the trust created pursuant to this
----------
Agreement, consisting of the Mortgage Loans, the assignment of the
Depositor's rights under the Mortgage Loan Sale and Assignment Agreement,
such amounts as shall from time to time be held in the Certificate Account,
the Insurance Policies, any REO Property and the other items referred to in,
and conveyed to the Trustee under, Section 2.01(a).
Trustee: Norwest Bank Minnesota, N.A., or any successor in interest,
-------
or if any successor trustee or any co-trustee shall be appointed as herein
provided, then such successor trustee and such co-trustee, as the case may
be.
Trustee Fee: With respect to any Distribution Date, an amount equal
-----------
to the product of (i) the Trustee Fee Rate and (ii) the aggregate outstanding
principal balance of the Mortgage Loans as of the immediately preceding Due
Date.
Trustee Fee Rate: 0.0175% per annum.
----------------
Unscheduled Principal Amount: As to any Distribution Date, the sum
----------------------------
of the amounts described in clauses (ii)(b) and (iii) (without regard to the
reference in clause (iii) to the "Senior Prepayment Percentage") of the
definition of Senior Principal Distribution Amount.
Voting Interests: The portion of the voting rights of all the
----------------
Certificates that is allocated to any Certificate for purposes of the voting
provisions of this Agreement. Voting Interests shall be allocated among the
other Classes of Certificates (and among the Certificates within each such
Class) in proportion to their Class Certificate Principal Amounts (or
Certificate Principal Amounts).
Weighted Average Rate: With respect to any Distribution Date, the
---------------------
per annum variable rate equal to the weighted average of the Net Mortgage
Rates of the Mortgage Loans as of the first day of the calendar month
immediately preceding such Distribution Date.
Section 1.02. Calculations Respecting Mortgage Loans. Calculations
--------------------------------------
required to be made pursuant to this Agreement with respect to any Mortgage
Loan in the Trust Fund shall be made based upon current information as to the
terms of the Mortgage Loans and reports of payments received from the
Mortgagor on such Mortgage Loans and payments to be made to the Trustee as
supplied to the Trustee by the Servicer. The Trustee shall not be required
to recompute, verify or recalculate the information supplied to it by the
Servicer.
Section 1.03. Calculations Respecting Accrued Interest. Accrued
----------------------------------------
interest, if any, on any Certificate shall be calculated based upon a 360-day
year consisting of twelve 30-day months.
ARTICLE II
DECLARATION OF TRUST;
ISSUANCE OF CERTIFICATES
Section 2.01. Creation and Declaration of Trust Fund; Conveyance of
-----------------------------------------------------
Mortgage Loans. (a) Concurrently with the execution and delivery of this
--------------
Agreement, the Depositor does hereby transfer, assign, set over, deposit with
and otherwise
convey to the Trustee, without recourse, in trust, all the right, title and
interest of the Depositor in and to the Mortgage Loans. Such conveyance
includes, without limitation, the right to all distributions of principal and
interest due with respect to the Mortgage Loans after the Cut-off Date,
together with all of the Depositor's right, title and interest in and to the
Certificate Account and all amounts from time to time credited to and the
proceeds of the Certificate Account, any REO Property and the proceeds
thereof, the Depositor's rights under any Insurance Policies related to the
Mortgage Loans, and the Depositor's security interest in any collateral
pledged to secure the Mortgage Loans, including the Mortgaged Properties and
any Additional Collateral, to have and to hold, in trust; and the Trustee
declares that, subject to the review provided for in Section 2.02, it has
received and shall hold the Trust Fund, as trustee, in trust, for the benefit
and use of the Holders of the Certificates and for the purposes and subject
to the terms and conditions set forth in this Agreement, and, concurrently
with such receipt, has caused to be executed, authenticated and delivered to
or upon the order of the Depositor, in exchange for the Trust Fund,
Certificates in the authorized denominations evidencing the entire ownership
of the Trust Fund.
Concurrently with the execution and delivery of this agreement, the
Depositor does hereby assign to the Trustee all of its rights and interest
under the Mortgage Loan Sale and Assignment Agreement, which include all of
the Depositor's rights and interests under the Sale and Servicing Agreement
(but which do not include the rights of Xxxxxx Capital under Section 11.12
thereof), and delegates its obligations under the Mortgage Loan Sale and
Assignment Agreement, which include the obligations of Xxxxxx Capital under
the Sale and Servicing Agreement, (which rights and interests have been
assigned and which obligations have been delegated to the Depositor by Xxxxxx
Capital pursuant to the Mortgage Loan Sale and Assignment Agreement) to the
Trustee. The Trustee hereby accepts such assignment and delegation, and
shall be entitled to exercise all such rights of the Depositor under the
Mortgage Loan Sale and Assignment Agreement and the Sale and Servicing
Agreement as if, for such purpose, it were the Depositor.
(b) In connection with such transfer and assignment, the Depositor does
hereby deliver to, and deposit with, or cause to be delivered to and
deposited with, the Custodian, acting on behalf of the Trustee, the documents
or instruments with respect to each Mortgage Loan (each a "Mortgage File") so
transferred and assigned as are specified in the Sale and Servicing
Agreement.
The parties hereto acknowledge and agree that the form of endorsement
attached hereto as Exhibit B-2 is intended to effect the transfer to the
Trustee, for the benefit of the Certificateholders, of the Mortgage Notes and
the Mortgages.
(c) Assignments of Mortgage shall be recorded; provided, however,
-------- -------
that such Assignments need not be recorded if, in the Opinion of Counsel
(which must be Independent counsel) acceptable to the Trustee and the Rating
Agencies, recording in such states is not required to protect the Trustee's
interest in the related Mortgage Loans. Subject to the preceding sentence,
as soon as practicable after the Closing Date, the Trustee shall cause the
Custodian, at the expense of the Depositor, to cause to be properly recorded
in each public recording office where the Mortgages are recorded each
Assignment of Mortgage.
(d) For Mortgage Loans (if any) that have been prepaid in full after
the Cut-off Date and prior to the Closing Date, the Depositor, in lieu of
delivering the above-referenced documents, herewith delivers or causes to be
delivered to the Trustee an Officer's Certificate which shall include a
statement to the effect that all amounts received in connection with such
prepayment that are required to be deposited in the Custodial Account
maintained by the Servicer pursuant to the Sale and Servicing Agreement have
been so deposited.
Section 2.02. Acceptance of Trust Fund by Trustee: Review of
----------------------------------------------
Documentation for Trust Fund. (a) The Trustee, by execution and delivery
----------------------------
hereof, acknowledges receipt (by it or by the Custodian) of the Mortgage
Files pertaining to the Mortgage Loans listed on the Mortgage Loan Schedule,
subject to the review thereof by the Custodian in its capacity as designee of
the Purchaser under the Sale and Servicing Agreement and to the Trustee's
review thereof as specified herein. The Custodian executed and delivered as
of January 15, 1997, an initial certification (the "Initial Certification")
certifying as to its receipt of the documents required to be delivered
pursuant to the Sale and Servicing Agreement and identifying any defects in
such documents, and delivered such certification to the Depositor and to The
Boston Company. Pursuant to Section 3.03 of the Sale and Servicing
Agreement, The Boston Company is obligated to cure any Material Defect (as
defined in the Sale and Servicing Agreement) identified in such Initial
Certification, or to repurchase the related Mortgage Loan or substitute
another mortgage loan therefor, within 60 days of receipt of such Initial
Certification.
(b) Prior to the first anniversary of the Closing Date, the Trustee
shall deliver (or cause its custodian to deliver) to the Depositor a Final
Certification substantially in the form annexed hereto as Exhibit B-1
evidencing the completeness of the Mortgage Files in its possession or
control.
(c) Nothing in this Agreement shall be construed to constitute an
assumption by the Trust Fund, the Trustee or the
Certificateholders of any unsatisfied duty, claim or other liability on any
Mortgage Loan or to any Mortgagor.
Section 2.03. Representations and Warranties of the Depositor. (a)
-----------------------------------------------
The Depositor hereby represents and warrants to the Trustee, as of the
Closing Date or such other date as is specified, that:
(i) the Depositor is a corporation duly organized, validly
existing and in good standing under the laws governing its creation and
existence and has full corporate power and authority to own its
property, to carry on its business as presently conducted, to enter into
and perform its obligations under this Agreement, and to create the
trust pursuant hereto;
(ii) the execution and delivery by the Depositor of this Agreement
have been duly authorized by all necessary corporate action on the part
of the Depositor; neither the execution and delivery of this Agreement,
nor the consummation of the transactions herein contemplated, nor
compliance with the provisions hereof, will conflict with or result in a
breach of, or constitute a default under, any of the provisions of any
law, governmental rule, regulation, judgment, decree or order binding on
the Depositor or its properties or the certificate of incorporation or
bylaws of the Depositor;
(iii) the execution, delivery and performance by the Depositor of
this Agreement and the consummation of the transactions contemplated
hereby do not require the consent or approval of, the giving of notice
to, the registration with, or the taking of any other action in respect
of, any state, federal or other governmental authority or agency, except
such as has been obtained, given, effected or taken prior to the date
hereof;
(iv) this Agreement has been duly executed and delivered by the
Depositor and, assuming due authorization, execution and delivery by the
Trustee, constitutes a valid and binding obligation of the Depositor
enforceable against it in accordance with its terms except as such
enforceability may be subject to (A) applicable bankruptcy and
insolvency laws and other similar laws affecting the enforcement of the
rights of creditors generally and (B) general principles of equity
regardless of whether such enforcement is considered in a proceeding in
equity or at law;
(v) there are no actions, suits or proceedings pending or, to the
knowledge of the Depositor, threatened or likely to be asserted against
or affecting the Depositor, before or
by any court, administrative agency, arbitrator or governmental body (A)
with respect to any of the transactions contemplated by this Agreement
or (B) with respect to any other matter which in the judgment of the
Depositor will be determined adversely to the Depositor and will if
determined adversely to the Depositor materially and adversely affect it
or its business, assets, operations or condition, financial or
otherwise, or adversely affect its ability to perform its obligations
under this Agreement;
(b) The representations and warranties of The Boston Company with
respect to the Mortgage Loans in the Sale and Servicing Agreement, which have
been assigned to the Trustee hereunder, were made as of January 15, 1997. To
the extent that any fact, condition or event with respect to a Mortgage Loan
constitutes a breach of both (i) a representation or warranty of The Boston
Company under the Sale and Servicing Agreement and (ii) a representation or
warranty of Xxxxxx Capital under the Mortgage Loan Sale and Assignment
Agreement, the only right or remedy of the Trustee or of any
Certificateholder shall be the Trustee's right to enforce the obligations of
The Boston Company under any applicable representation or warranty made by
it. The Trustee acknowledges that the representations and warranties of
Xxxxxx Capital in Section 1.04(b) of the Mortgage Loan Sale and Assignment
Agreement are applicable only to facts or conditions that arise or events
that occur subsequent to January 15, 1997, and which do not constitute a
breach of any representation or warranty made by The Boston Company in
Section 3.02 of the Sale and Servicing Agreement. The Trustee acknowledges
that Xxxxxx Capital shall have no obligation or liability with respect to any
breach of a representation or warranty made by it with respect to the
Mortgage Loans if the fact, condition or event constituting such breach also
constitutes a breach of a representation or warranty made by The Boston
Company in Section 3.02 of the Sale and Servicing Agreement, without regard
to whether The Boston Company fulfills its contractual obligations in respect
of such representation or warranty. The Trustee further acknowledges that
the Depositor shall have no obligation or liability with respect to any
breach of any representation or warranty with respect to the Mortgage Loans
under any circumstances.
Section 2.04. Discovery of Breach. It is understood and agreed that
-------------------
the representations and warranties set forth in Section 2.03 and the
representations and warranties of The Boston Company and Xxxxxx Capital
assigned to the Trustee hereunder survive delivery of the Mortgage Files and
the Assignment of Mortgage of each Mortgage Loan to the Trustee and shall
continue throughout the term of this Agreement. Upon discovery by either the
Depositor or the Trustee of a breach of any of the representations and
warranties set forth in Section 2.03 that adversely and materially affects
the value of the related Mortgage Loan, the party discovering such breach
shall give prompt written notice to the other party. Within 90 days of the
discovery of such a breach with respect to the representations and warranties
given to the Trustee, the Depositor shall either (a) cure such breach in all
material respects, (b) repurchase such Mortgage Loan or any property acquired
in respect thereof from the Trustee at the Purchase Price or (c) within the
two year period following the Closing Date, substitute a Qualifying
Substitute Mortgage Loan for the affected Mortgage Loan.
Section 2.05. Repurchase, Purchase or Substitution of Mortgage
------------------------------------------------
Loans. (a) With respect to any Mortgage Loan repurchased by the
-----
Depositor pursuant to this Article II, by The Boston Company pursuant to the
Sale and Servicing Agreement or by Xxxxxx Capital pursuant to the Mortgage
Loan Sale and Assignment Agreement, the principal portion of the funds
received by the Trustee in respect of such repurchase of a Mortgage Loan will
be considered a Principal Prepayment and shall be deposited in the
Certificate Account. The Trustee, upon receipt of the full amount of the
Purchase Price for a Deleted Mortgage Loan, or upon receipt of the Mortgage
File for a Qualifying Substitute Mortgage Loan substituted for a Deleted
Mortgage Loan, shall release or cause to be released and reassign to the
Depositor, The Boston Company or Xxxxxx Capital, as applicable, the related
Mortgage File for the Deleted Mortgage Loan and shall execute and deliver
such instruments of transfer or assignment, in each case without recourse,
representation or warranty, as shall be necessary to vest in such party or
its designee or assignee title to any Deleted Mortgage Loan released pursuant
hereto, free and clear of all security interests, liens and other
encumbrances created by this Agreement, which instruments shall be prepared
by the Trustee (or its custodian) at the Depositor's expense, and the Trustee
shall have no further responsibility with respect to the Mortgage File
relating to such Deleted Mortgage Loan.
(b) With respect to each Qualifying Substitute Mortgage Loan to be
delivered to the Trustee (or its custodian) by the Depositor pursuant to the
terms of this Article II in exchange for a Deleted Mortgage Loan: (i) the
Depositor must deliver to the Trustee (or its custodian) the Mortgage File
for the Qualifying Substitute Mortgage Loan containing the documents set
forth in Section 2.01(b) along with a written certification certifying as to
the delivery of such Mortgage File and containing the granting language set
forth in Section 2.01(a); and (ii) the Depositor will be deemed to have made
each of the representations and warranties set forth in Section 2.03(f). As
soon as practicable after the delivery of any Qualifying Substitute Mortgage
Loan hereunder, the Trustee shall cause the Assignment of Mortgage with
respect to such Qualifying Substitute Mortgage Loan to be recorded if
required pursuant to the first sentence of Section 2.01(c).
(c) Notwithstanding any other provision of this Agreement, the right to
substitute Mortgage Loans pursuant to this Article II shall be subject to the
additional limitations that no substitution of a Qualifying Substitute
Mortgage Loan for a Deleted Mortgage Loan shall be made unless the Trustee
has received an Opinion of Counsel (at the expense of the party seeking to
make the substitution) that, under current law, such substitution will not
(A) affect adversely the status of any REMIC established hereunder as a
REMIC, or of the related "regular interests" as "regular interests" in any
such REMIC, or (B) cause any such REMIC to engage in a "prohibited
transaction" or prohibited contribution pursuant to the REMIC Provisions.
Section 2.06. Converted Mortgage Loans. The Trustee acknowledges
------------------------
that, pursuant to the Sale and Servicing Agreement, the Servicer is obligated
to purchase any Converted Mortgage Loan from the Trust Fund or substitute
another mortgage loan therefor. In the event that the Servicer defaults on
its obligation to purchase any Converted Mortgage Loan from the Trust Fund
(or to substitute another mortgage loan), the Trustee will attempt to sell
such Converted Mortgage Loan, but only at a price at which the Trust Fund
would receive a net amount at least equal to the Repurchase Price specified
in the Sale and Servicing Agreement. Until sold at such price, each
Converted Mortgage Loan will remain in the Trust Fund with the applicable
fixed Mortgage Rate.
Section 2.07. Grant Clause. It is intended that the conveyance of
------------
the Depositor's right, title and interest in and to property constituting the
Trust Fund pursuant to this Agreement shall constitute, and shall be
construed as, a sale of such property and not grant of a security interest to
secure a loan. However, if such conveyance is deemed to be in respect of a
loan, it is intended that: (1) the rights and obligations of the parties
shall be established pursuant to the terms of this Agreement; (2) the
Depositor hereby grants to the Trustee for the benefit of the Holders of the
Certificates a first priority security interest in all of the Depositor's
right, title and interest in, to and under, whether now owned or hereafter
acquired, the Trust Fund and all proceeds of any and all property
constituting the Trust Fund to secure payment of the Certificates; and (3)
this Agreement shall constitute a security agreement under applicable law.
If such conveyance is deemed to be in respect of a loan and the Trust created
by this Agreement terminates prior to the satisfaction of the claims of any
Person holding any Certificate, the security interest created hereby shall
continue in full force and effect and the Trustee shall be deemed to be the
collateral agent for the benefit of such Person, and all proceeds shall be
distributed as herein provided.
ARTICLE III
THE CERTIFICATES
Section 3.01. The Certificates. (a) The Certificates shall be
----------------
issuable in registered form only. The Book-Entry Certificates will be
evidenced by one or more certificates, beneficial ownership of which will be
held in the dollar denominations in Certificate Principal Amount or Notional
Amount, as applicable, specified in this paragraph. Each Class of Book-Entry
Certificates will be issued in the minimum denominations in Certificate
Principal Amount specified in the Preliminary Statement hereto and in
integral multiples of $1 in excess thereof. Each Class of Non-Book Entry
Certificates other than the Residual Certificates will be issued in
definitive, fully registered form in the minimum denominations in Certificate
Principal Amount specified in the Preliminary Statement hereto and in
integral multiples of $1,000 (or $1,000,000, in the case of a Class of
Notional Certificates) in excess thereof. Each Residual Certificate will be
issued as a single Certificate and maintained in definitive, fully registered
form in a minimum denomination equal to 100% of the Percentage Interest of
such Class. The Certificates may be issued in the form of typewritten
certificates. One Certificate of each Class of Certificates other than the
Residual Certificates may be issued in any denomination in excess of the
minimum denomination.
(b) The Certificates shall be executed by manual or facsimile signature
on behalf of the Trustee by an authorized officer. Each Certificate shall,
on original issue, be authenticated by the Trustee upon the order of the
Depositor upon receipt by the Trustee of the Mortgage Files described in
Section 2.01. No Certificate shall be entitled to any benefit under this
Agreement, or be valid for any purpose, unless there appears on such
Certificate a certificate of authentication substantially in the form
provided for herein, executed by an authorized officer of the Trustee or the
Authenticating Agent, if any, by manual signature, and such certification
upon any Certificate shall be conclusive evidence, and the only evidence,
that such Certificate has been duly authenticated and delivered hereunder.
All Certificates shall be dated the date of their authentication. At any
time and from time to time after the execution and delivery of this
Agreement, the Depositor may deliver Certificates executed by the Depositor
to the Trustee or the Authenticating Agent for authentication and the Trustee
or the Authenticating Agent shall authenticate and deliver such Certificates
as in this Agreement provided and not otherwise.
Section 3.02. Registration. The Trustee is hereby appointed, and
------------
hereby accepts its appointment as, Certificate Registrar in respect of the
Certificates and shall maintain books for the registration and for the
transfer of Certificates (the "Certificate Register"). The Trustee may
appoint a bank or trust company to act as Certificate Registrar. A
registration book shall be maintained for the Certificates collectively. The
Certificate Registrar may resign or be discharged or removed and a new
successor may be appointed in accordance with the procedures and requirements
set forth in Sections 6.06 and 6.07 hereof with respect to the resignation,
discharge or removal of the Trustee and the appointment of a successor
Trustee. The Certificate Registrar may appoint, by a written instrument
delivered to the Holders, any bank or trust company to act as co-registrar
under such conditions as the Certificate Registrar may prescribe; provided,
however, that the
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Certificate Registrar shall not be relieved of any of its duties or
responsibilities hereunder by reason of such appointment.
Section 3.03. Transfer and Exchange of Certificates. (a) A
-------------------------------------
Certificate (other than Book-Entry Certificates which shall be subject to
Section 3.09 hereof) may be transferred by the Holder thereof only upon
presentation and surrender of such Certificate at the office of the
Certificate Registrar duly endorsed or accompanied by an assignment duly
executed by such Holder or his duly authorized attorney in such form as shall
be satisfactory to the Certificate Registrar. Upon the transfer of any
Certificate in accordance with the preceding sentence, the Trustee shall
execute, and the Trustee or any Authenticating Agent shall authenticate and
deliver to the transferee, one or more new Certificates of the same Class and
evidencing, in the aggregate, the same aggregate Certificate Principal Amount
as the Certificate being transferred. No service charge shall be made to a
Certificateholder for any registration of transfer of Certificates, but the
Certificate Registrar may require payment of a sum sufficient to cover any
tax or governmental charge that may be imposed in connection with any
registration of transfer of Certificates.
(b) A Certificate may be exchanged by the Holder thereof for any number
of new Certificates of the same Class, in authorized denominations,
representing in the aggregate the same Certificate Principal Amount as the
Certificate surrendered, upon surrender of the Certificate to be exchanged at
the office of the Certificate Registrar duly endorsed or accompanied by a
written instrument of transfer duly executed by such Holder or his duly
authorized attorney in such form as is satisfactory to the Certificate
Registrar. Certificates delivered upon any such exchange will evidence the
same obligations, and will be entitled to the same rights and privileges, as
the Certificates surrendered. No service charge shall be made to a
Certificateholder for any exchange of Certificates, but the Certificate
Registrar may require payment of a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any exchange of
Certificates. Whenever any Certificates are so surrendered for exchange, the
Trustee shall execute, and the Trustee or the Authenticating Agent shall
authenticate, date and deliver the Certificates which the Certificateholder
making the exchange is entitled to receive.
(c) By acceptance of a Restricted Certificate, whether upon original
issuance or subsequent transfer, each Holder of such a Certificate
acknowledges the restrictions on the transfer of such Certificate set forth
thereon and agrees that it will transfer such a Certificate only as provided
herein.
The following restrictions shall apply with respect to the transfer and
registration of transfer of a Restricted Certificate to a transferee that
takes delivery in the form of a Definitive Certificate:
(i) The Certificate Registrar shall register the transfer of a
Restricted Certificate if the requested transfer is (x) to the Depositor
or the Placement Agent, an affiliate (as defined in Rule 144(a)(1) under
the 0000 Xxx) of the Depositor or the Placement Agent or (y) being made
to a "qualified institutional buyer" as defined in Rule 144A under the
Securities Act of 1933, as amended (the "Act") by a transferor who has
provided the Trustee with a certificate in the form of Exhibit F hereto;
and
(ii) The Certificate Registrar shall register the transfer of a
Restricted Certificate if the requested transfer is being made to an
"accredited investor" under Rule 501(a)(1), (2), (3) or (7) under the
Act by a transferor who furnishes to the Trustee a letter of the
transferee substantially in the form of Exhibit G hereto.
(d) (i) No transfer of an ERISA-Restricted Certificate in the
form of a Definitive Certificate shall be made to any Person unless the
Trustee has received (A) a certificate substantially in the form of Exhibit H
hereto from such transferee or (B) an Opinion of Counsel satisfactory to the
Trustee and the Depositor to the effect that the purchase and holding of such
a Certificate will not constitute or result in the assets of the Trust Fund
being deemed to be "plan assets" subject to the prohibited transactions
provisions of ERISA or Section 4975 of the Code and will not subject the
Trustee or the Depositor to any obligation in addition to those undertaken in
the Agreement; provided, however, that
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the Trustee will not require such certificate or opinion in the event that,
as a result of a change of law or otherwise, counsel satisfactory to the
Trustee has rendered an opinion to the effect that the purchase and holding
of an ERISA-Restricted Certificate by a Plan or a Person that is purchasing
or holding such a Certificate with the assets of a Plan will not constitute
or result in a prohibited transaction under ERISA or Section 4975 of the
Code. The preparation and delivery of the certificate and opinions referred
to above shall not be an expense of the Trust Fund, the Trustee or the
Depositor. Notwithstanding the foregoing, no opinion or certificate shall be
required for the initial issuance of the ERISA-Restricted Certificates.
(e) As a condition of the registration of transfer or exchange of any
Certificate, the Certificate Registrar may require the certified taxpayer
identification number of the owner of the Certificate and the payment of a
sum sufficient to cover any tax or other governmental charge imposed in
connection therewith; provided, however, that the Certificate Registrar shall
have no obligation to require such payment or to determine whether or not any
such tax or charge may be applicable. No service charge shall be made to the
Certificateholder for any registration, transfer or exchange of Certificate.
(f) Notwithstanding anything to the contrary contained herein, no
Residual Certificate may be owned, pledged or transferred, directly or
indirectly, by or to a Disqualified Organization.
Prior to and as a condition of the registration of any transfer, sale or
other disposition of a Residual Certificate, the proposed transferee shall
deliver to the Trustee an affidavit in substantially the form attached hereto
as Exhibit D-1 representing and warranting, among other things, that such
transferee is neither a Disqualified Organization nor an agent or nominee
acting on behalf of a Disqualified Organization (any such transferee, a
"Permitted Transferee"), and the proposed transferor shall deliver to the
Trustee an affidavit in substantially the form attached hereto as Exhibit D-
2. In addition, the Trustee may (but shall have no obligation to) require,
prior to and as a condition of any such transfer, the delivery by the
proposed transferee of an Opinion of Counsel, addressed to the Depositor and
the Trustee satisfactory in form and substance to the Depositor, that such
proposed transferee or, if the proposed transferee is an agent or nominee,
the proposed beneficial owner, is not a Disqualified Organization.
Notwithstanding the registration in the Certificate Register of any transfer,
sale, or other disposition of a Residual Certificate to a Disqualified
Organization or an agent or nominee acting on behalf of a Disqualified
Organization, such registration shall be deemed to be of no legal force or
effect whatsoever and such Disqualified Organization (or such agent or
nominee) shall not be deemed to be a Certificateholder for any purpose
hereunder, including, but not limited to, the receipt of distributions on
such Residual Certificate. The Trustee shall not be under any liability to
any person for any registration or transfer of a Residual Certificate to a
Disqualified Organization or for the maturity of any payments due on such
Residual Certificate to the Holder thereof or for taking any other action
with respect to such Holder under the provisions of the Agreement, so long as
the transfer was effected in accordance with this Section 3.03(f), unless the
Trustee shall have actual knowledge at the time of such transfer or the time
of such payment or other action that the transferee is a Disqualified
Organization (or an agent or nominee thereof). The Trustee shall be entitled
to recover from any Holder of a Residual Certificate that was a Disqualified
Organization (or an agent or nominee thereof) at the time it became a Holder
or any subsequent time it became a Disqualified Organization all payments
made on such Residual Certificate at and after either such times (and all
costs and expenses, including but not limited to attorneys' fees, incurred in
connection therewith). Any payment (not including any such costs and
expenses) so recovered by the Trustee shall be paid and delivered to the last
preceding Holder of such Residual Certificate.
If any purported transferee shall become a registered Holder of a
Residual Certificate in violation of the provisions of this Section 3.03(f),
then upon receipt of written notice to the Trustee that the registration of
transfer of such Residual Certificate was not in fact permitted by this
Section 3.03(f), the last preceding Permitted Transferee shall be restored to
all rights as Holder thereof retroactive to the date of such registration of
transfer of such Residual Certificate. The Trustee shall be under no
liability to any Person for any registration of transfer of a Residual
Certificate that is in fact not permitted by this Section 3.03(f), for making
any payment due on such Certificate to the registered Holder thereof or for
taking any other action with respect to such Holder under the provisions of
this Agreement so long as the transfer was registered upon receipt of the
affidavit described in the preceding paragraph of this Section 3.03(f).
(g) Each Holder of a Residual Certificate, by such Holder's acceptance
thereof, shall be deemed for all purposes to have consented to the provisions
of this section.
Section 3.04. Cancellation of Certificates. Any Certificate
----------------------------
surrendered for registration of transfer or exchange shall be cancelled and
retained in accordance with normal retention policies with respect to
cancelled certificates maintained by the Trustee or the Certificate
Registrar.
Section 3.05. Replacement of Certificates. If (i) any Certificate
---------------------------
is mutilated and is surrendered to the Trustee or any Authenticating Agent or
(ii) the Trustee or any Authenticating Agent receives evidence to its
satisfaction of the destruction, loss or theft of any Certificate, and there
is delivered to the Trustee or the Authenticating Agent such security or
indemnity as may be required by them to save each of them harmless, then, in
the absence of notice to the Depositor and any Authenticating Agent that such
destroyed, lost or stolen Certificate has been acquired by a bona fide
purchaser, the Trustee shall execute and the Trustee or any Authenticating
Agent shall authenticate and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Certificate, a new Certificate of like
tenor and Certificate Principal Amount. Upon the issuance of any new
Certificate under this Section 3.05, the Trustee and Authenticating Agent may
require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee or the
Authenticating Agent) connected therewith. Any replacement Certificate
issued pursuant to this Section 3.05 shall constitute complete and
indefeasible evidence of ownership in the applicable Trust Fund, as if
originally issued, whether or not the lost, stolen or destroyed Certificate
shall be found at any time.
Section 3.06. Persons Deemed Owners. Subject to the provisions of
---------------------
Section 3.09 with respect to Book-Entry Certificates, the Depositor, the
Trustee, the Certificate Registrar and any agent of any of them may treat the
Person in whose name any Certificate is registered upon the books of the
Certificate Registrar as the owner of such Certificate for the purpose of
receiving distributions pursuant to Sections 5.01 and 5.02 and for all other
purposes whatsoever, and neither the Depositor, the Trustee, the Certificate
Registrar nor any agent of any of them shall be affected by notice to the
contrary.
Section 3.07. Temporary Certificates. (a) Pending the preparation
----------------------
of definitive Certificates, upon the order of the Depositor, the Trustee
shall execute and shall authenticate and deliver temporary Certificates that
are printed, lithographed, typewritten, mimeographed or otherwise produced,
in any authorized denomination, substantially of the tenor of the definitive
Certificates in lieu of which they are issued and with such variations as the
authorized officers executing such Certificates may determine, as evidenced
by their execution of such Certificates.
(b) If temporary Certificates are issued, the Depositor will cause
definitive Certificates to be prepared without unreasonable delay. After the
preparation of definitive Certificates, the temporary Certificates shall be
exchangeable for definitive Certificates upon surrender of the temporary
Certificates at the office or agency of the Trustee without charge to the
Holder. Upon surrender for cancellation of any one or more temporary
Certificates, the Trustee shall execute and authenticate and deliver in
exchange therefor a like aggregate Certificate Principal Amount of definitive
Certificates of the same Class in the authorized denominations. Until so
exchanged, the temporary Certificates shall in all respects be entitled to
the same benefits under this Agreement as definitive Certificates of the same
Class.
Section 3.08. Appointment of Paying Agent. The Trustee may appoint
---------------------------
a Paying Agent (which may be the Trustee) for the purpose of making
distributions to Certificateholders hereunder. The Trustee shall cause such
Paying Agent to execute and deliver to the Trustee an instrument in which
such Paying Agent shall agree with the Trustee that such Paying Agent will
hold all sums held by it for the payment to Certificateholders in an Eligible
Account in trust for the benefit of the Certificateholders entitled thereto
until such sums shall be paid to the Certificateholders. All funds remitted
by the Trustee to any such Paying Agent for the purpose of making
distributions shall be paid to Certificateholders on each Distribution Date
and any amounts not so paid shall be returned on such Distribution Date to
the Trustee. If the Paying Agent is not the Trustee, the Trustee shall cause
to be remitted to the Paying Agent on or before the Business Day prior to
each Distribution Date, by wire transfer in immediately available funds, the
funds to be distributed on such Distribution Date. Any Paying Agent shall be
either a bank or trust company or otherwise authorized under law to exercise
corporate trust powers.
Section 3.09. Book-Entry Certificates. (a) Each Class of
-----------------------
Book-Entry Certificates, upon original issuance, shall be issued in the form
of one or more typewritten Certificates representing the Book-Entry
Certificates, to be delivered to The Depository Trust Company, the initial
Clearing Agency, by, or on behalf of, the Depositor. The Book-Entry
Certificates shall initially be registered on the Certificate Register in the
name of the nominee of the Clearing Agency, and no Certificate Owner will
receive a definitive certificate representing such Certificate Owner's
interest in the Book-Entry Certificates, except as provided in Section
3.09(c). Unless Definitive Certificates have been issued to Certificate
Owners of Book-Entry Certificates pursuant to Section 3.09(c):
(i) the provisions of this Section 3.09 shall be in full force and
effect;
(ii) the Depositor, the Paying Agent, the Registrar and the Trustee
may deal with the Clearing Agency for all purposes (including the making
of distributions on the Book-Entry Certificates) as the authorized
representatives of the Certificate Owners and the Clearing Agency shall
be responsible for crediting the amount of such distributions to the
accounts of such Persons entitled thereto, in accordance with the
Clearing Agency's normal procedures;
(iii) to the extent that the provisions of this Section 3.09
conflict with any other provisions of this Agreement, the provisions of
this Section 3.09 shall control; and
(iv) the rights of Certificate Owners shall be exercised only
through the Clearing Agency and the Clearing Agency Participants and
shall be limited to those established by law and agreements between such
Certificate Owners and the Clearing Agency and/or the Clearing Agency
Participants. Unless and until Definitive Certificates are issued
pursuant to Section 3.09(c), the initial Clearing Agency will make
book-entry transfers among the Clearing Agency Participants and receive
and transmit distributions of principal of and interest on the
Book-Entry Certificates to such Clearing Agency Participants.
(b) Whenever notice or other communication to the Certificateholders is
required under this Agreement, unless and until Definitive Certificates shall
have been issued to Certificate Owners pursuant to Section 3.09(c), the
Trustee shall give all such notices and communications specified herein to be
given to Holders of the Book-Entry Certificates to the Clearing Agency.
(c) If (i)(A) the Depositor advises the Trustee in writing that the
Clearing Agency is no longer willing or able to discharge properly its
responsibilities with respect to the Book-Entry Certificates, and (B) the
Trustee or the Depositor is unable to locate a qualified successor, (ii) the
Depositor, at its option, advises the Trustee in writing that it elects to
terminate the book-entry system through the Clearing Agency or (iii) after
the occurrence of an Event of Default, Certificate Owners representing
beneficial interests aggregating not less than 50% of the Class Certificate
Principal Amount of a Class of Book-Entry Certificates identified as such to
the Trustee by an Officer's Certificate from the Clearing Agency advise the
Trustee and the Clearing Agency through the Clearing Agency Participants in
writing that the continuation of a book-entry system through the Clearing
Agency is no longer in the best interests of the Certificate Owners of a
Class of Book-Entry Certificates, the Trustee shall notify or cause the
Certificate Registrar to notify the Clearing Agency to effect notification to
all Certificate Owners, through the Clearing Agency, 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 Clearing Agency, accompanied by registration instructions
from the Clearing Agency for registration, the Trustee shall issue the
Definitive Certificates. Neither the Transferor nor the Trustee shall be
liable for any delay in delivery of such instructions and may conclusively
rely on, and shall be protected in relying on, such instructions. Upon the
issuance of Definitive Certificates all references herein to obligations
imposed upon or to be performed by the Clearing Agency shall be deemed to be
imposed upon and performed by the Trustee, to the extent applicable, with
respect to such Definitive Certificates and the Trustee shall recognize the
holders of the Definitive Certificates as Certificateholders hereunder.
ARTICLE IV
ADMINISTRATION OF THE TRUST FUND
Section 4.01. (Omitted).
Section 4.02. (Omitted).
Section 4.03. Reports to Certificateholders. (a) On each
-----------------------------
Distribution Date, the Trustee shall deliver or cause to be delivered by
first class mail to each Certificateholder a written report setting forth the
following information, which information the Trustee will determine on the
basis of, with respect to the Mortgage Loans, data which the Servicer will
provide to the Trustee or its designee prior to the Remittance Date:
(i) the aggregate amount of the distribution to be made on such
Distribution Date to the Holders of each Class of Certificates (and in
respect of any Component), other than any Class of Notional Certificates
(or any Notional Component), allocable to principal on the Mortgage
Loans, including Liquidation Proceeds and Insurance Proceeds, stating
separately the amount attributable to scheduled principal payments and
unscheduled payments in the nature of principal;
(ii) the aggregate amount of the distribution to be made on such
Distribution Date to the Holders of each Class of Certificates (other
than any Class of Principal Only Certificates) allocable to interest,
including any Accrual Amount added to the Class Certificate Principal
Amount of any Class of Accrual Certificates;
(iii) the amount, if any, of any distribution to the Holder of each
Class of Residual Certificates;
(iv) the aggregate amount of any Advances made by or on behalf of
the Servicer (or the Trustee) included in the amounts actually
distributed to the Certificateholders;
(v) the aggregate Scheduled Principal Balance of the Mortgage
Loans as of the close of business on the last day of the related Due
Period, after giving effect to payments allocated to principal reported
under clause (i) above;
(vi) the Class Certificate Principal Amount (or Aggregate Notional
Amount) of each Class of Certificates as of such Distribution Date after
giving effect to payments
allocated to principal reported under clause (i) above (and to the
addition of any Accrual Amount in the case of any Class of Accrual
Certificates), separately identifying any reduction of any of the
foregoing Certificate Principal Amounts due to Realized Losses:
(vii) any Realized Losses realized with respect to the Mortgage
Loans (x) in the related Prepayment Period and (y) in the aggregate
since the Cut-off Date, stating separately the amount of Special Hazard
Losses, Fraud Losses and Bankruptcy Losses and the aggregate amount of
such Realized Losses, and the remaining Special Hazard Loss Amount,
Fraud Loss Amount and Bankruptcy Loss Amount;
(viii) the amount of the Servicing Fees paid during the Due Period to
which such distribution relates;
(ix) the number and aggregate Scheduled Principal Balance of
Mortgage Loans, as reported to the Trustee by the Servicer, (a)
remaining outstanding (b) delinquent one month, (c) delinquent two
months, (d) delinquent three or more months, and (e) as to which
foreclosure proceedings have been commenced as of the close of business
on the last Business Day of the calendar month immediately preceding the
month in which such Distribution Date occurs;
(x) the deemed principal balance of each REO Property as of the
close of business on the last Business Day of the calendar month
immediately preceding the month in which such Distribution Date occurs;
(xi) with respect to any Mortgage Loan that became an REO Property
during the preceding calendar month, the principal balance of such
Mortgage Loan and the number of such Mortgage Loans as of the close of
business on the Distribution Date in such preceding month;
(xii) with respect to substitution of Mortgage Loans in the
preceding calendar month, the Scheduled Principal Balance of each
Deleted Mortgage Loan, and of each Qualifying Substitute Mortgage Loan;
(xiii) the aggregate of any Net Prepayment Interest Shortfalls
allocated to each Class of Certificates on such Distribution Date;
(xiv) the aggregate outstanding Interest Shortfalls, if any, for
each Class of Certificates, after giving effect to the distribution made
on such Distribution Date;
(xv) the Certificate Interest Rate applicable to such Distribution
Date with respect to each Class of Certificates;
(xvi) if applicable, the amount of any shortfall (i.e., the
difference between the aggregate amounts of principal and interest which
Certificateholders would have received if there were sufficient
available amounts in the Certificate Account and the amounts actually
distributed); and
(xvii) any other "loan-level" information for any Mortgage Loans that
are delinquent three or more months and any REO Property held by the
Trust that is reported by the Servicer to the Trustee.
In the case of information furnished pursuant to subclauses (i), (ii)
and (viii) above, the amounts shall be expressed as a dollar amount per
$1,000 of original principal amount of Certificates.
(b) Upon the reasonable advance written request of any
Certificateholder that is a savings and loan, bank or insurance company, the
Trustee shall, to the extent that such information has been provided to the
Trustee by the Servicer, provide, or cause to be provided, to such
Certificateholder such reports and access to information and documentation
regarding the Mortgage Loans as such Certificateholder may reasonably deem
necessary to comply with applicable regulations of the Office of Thrift
Supervision or its successor or other regulatory authorities with respect to
investment in the Certificates; provided, however, that the Trustee
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shall be entitled to be reimbursed by such Certificateholder for such
Trustee's actual expenses incurred in providing such reports and access.
(c) Within 90 days, or such shorter period as may be required by
statute or regulation, after the end of each calendar year, the Trustee shall
send to each Person who at any time during the calendar year was a
Certificateholder of record, and make available to Certificate Owners
(identified as such by the Clearing Agency) in accordance with applicable
regulations, a report summarizing the items provided to Certificateholders
pursuant to Section 4.03(a) on an annual basis as may be required to enable
such Holders to prepare their federal income tax returns. Such information
shall include the amount of original issue discount accrued on each Class of
Certificates and information regarding the expenses of the Trust Fund.
(d) Not later than two days following each Distribution Date, the
Trustee shall deliver to the Persons designated by the Depositor, in the
format provided by the Servicer, "loan level" information with respect to the
Mortgage Loans as of the related Determination Date, to the extent that such
information has been provided in electronic format to the Trustee by the
Servicer.
Section 4.04. Certificate Account. (a) The Trustee shall establish
-------------------
and maintain in its name, as trustee, a special deposit trust account (the
"Certificate Account"), to be held in trust for the benefit of the
Certificateholders until disbursed pursuant to the terms of this Agreement.
The Certificate Account shall be an Eligible Account. If the existing
Certificate Account ceases to be an Eligible Account, the Trustee shall
establish a new Certificate Account that is an Eligible Account within 20
Business Days and transfer all funds on deposit in such existing Certificate
Account into such new Certificate Account. The Certificate Account shall
relate solely to the Certificates issued hereunder and funds in the
Certificate Account shall be held separate and apart from and shall not be
commingled with any other monies including, without limitation, other monies
of the Trustee held under this Agreement.
(b) The Trustee shall cause to be deposited into the Certificate
Account on the day on which, or, if such day is not a Business Day, the
Business Day immediately following the day on which, any monies are remitted
by the Servicer to the Trustee, all such amounts. The Trustee shall make
withdrawals from the Certificate Account only for the following purposes:
(i) to withdraw amounts deposited in the Certificate Account in
error;
(ii) to pay itself the Trustee Fee and any investment income earned
with respect to funds in the Certificate Account invested in Eligible
Investments as set forth in subsection (c) below, and to make payment to
itself and others pursuant to any provision of this Agreement;
(iii) to make distributions to the Certificateholders pursuant to
Article V; and
(iv) to clear and terminate the Certificate Account pursuant to
Section 7.02.
(c) The Trustee may invest, or cause to be invested, funds held in the
Certificate Account in Eligible Investments (which may be obligations of the
Trustee). All such investments must mature no later than the next
Distribution Date, and shall not be sold or disposed of prior to their
maturity. All such Eligible Investments will be made in the name of the
Trustee (in its capacity as such) or its nominee. All income and gain
realized from any such investment shall be additional compensation for the
Trustee and shall be subject to its withdrawal on order from time to time.
The amount of any losses incurred in respect of any such investments shall be
paid by the Trustee for deposit in the Certificate Account out of its own
funds immediately as realized.
Section 4.05. Determination of LIBOR. (a) If the outstanding
----------------------
Certificates include any LIBOR Certificates, then on each LIBOR Determination
Date the Trustee shall determine LIBOR on the basis of the offered LIBOR
quotations of the Reference Banks as of 11:00 a.m. London time on such LIBOR
Determination Date as follows:
(i) If on any LIBOR Determination Date two or more of the
Reference Banks provide such offered quotations, LIBOR for the next
Interest Accrual Period will be the arithmetic mean of such offered
quotations (rounding such arithmetic mean upwards if necessary to the
nearest whole multiple of 1/16%);
(ii) If on any LIBOR Determination Date only one or none of the
Reference Banks provides such offered quotations, LIBOR for the next
Interest Accrual Period will be whichever is the higher of (x) LIBOR as
determined on the previous LIBOR Determination Date or (y) the Reserve
Interest Rate. The "Reserve Interest Rate" will be either (A) the rate
per annum which the Trustee determines to be the arithmetic mean
(rounding such arithmetic mean upwards if necessary to the nearest whole
multiple of 1/16%) of the one-month Eurodollar lending rates that New
York City banks selected by the Trustee are quoting, on the relevant
LIBOR Determination Date, to the principal London offices of leading
banks in the London interbank market or (B) in the event that the
Trustee can determine no such arithmetic mean, the lowest one-month
Eurodollar lending rate that the New York City banks selected by the
Trustee are quoting on such LIBOR Determination Date to leading European
banks; and
(iii) If on any LIBOR Determination Date the Trustee is required but
is unable to determine the Reserve Interest Rate in the manner provided
in paragraph (ii) above, LIBOR for the next Interest Accrual Period will
be LIBOR as determined on the previous LIBOR Determination Date, or, in
the case of the first LIBOR Determination Date, the Initial LIBOR Rate.
(b) The establishment of LIBOR by the Trustee and the Trustee's
subsequent calculation of the Certificate Interest Rates applicable to the
LIBOR Certificates for the relevant Interest Accrual Period, in the absence
of manifest error, will be final and binding. In all cases, the Trustee may
conclusively rely on quotations of LIBOR for the Reference Banks as such
quotations appear on the display designated "LIUS01M" on the Bloomberg
Financial Markets Commodities News.
(c) As used herein, "Reference Banks" shall mean four leading
banks engaged in transactions in Eurodollar deposits in the international
Eurocurrency market (i) with an established place of business in London,
England, (ii) whose quotations appear on the "Bloomberg Screen LIUS01M Index
Page" (as described in the definition of LIBOR hereof) on the applicable
LIBOR Determination Date and (iii) which have been designated as such by the
Trustee and are able and willing to provide such quotations to the Trustee on
each LIBOR Determination Date. The Reference Banks initially shall be:
Barclay's plc, Bank of Tokyo, National Westminster Bank and Trust Company and
Bankers Trust Company. If any of the initial Reference Banks should be
removed from the Bloomberg Screen LIUS01M Index Page or in any other way fail
to meet the qualifications of a Reference Bank, the Trustee shall use its
best efforts to designate alternate Reference Banks.
ARTICLE V
DISTRIBUTIONS TO HOLDERS OF CERTIFICATES
Section 5.01. Distributions Generally. (a) Subject to Section 7.01
-----------------------
respecting the final distribution on the Certificates, on each Distribution
Date the Trustee or the Paying Agent shall make distributions in accordance
with this Article V. Such distributions shall be made by check mailed to
each Certificateholder's address as it appears on the Certificate Register of
the Certificate Registrar (which shall initially be the Trustee) or, upon
written request made to the Trustee at least three Business Days prior to the
related Distribution Date by any Certificateholder owning an aggregate
initial Certificate Principal Amount of at least $2,500,000, by wire transfer
in immediately available funds to an account specified in the request and at
the expense of such Certificateholder; provided, however, that the final
distribution in
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respect of any Certificate shall be made only upon presentation and surrender
of such Certificate at the Corporate Trust Office. Wire transfers will be
made at the expense of the Holder requesting such wire transfer by deducting
a wire transfer fee from the related distribution. Notwithstanding such
final payment of principal of any of the Certificates, the Residual
Certificates will remain outstanding until the termination of each REMIC and
the payment in full of all other amounts due with respect to the Residual
Certificates and at such time such final payment in retirement of any
Residual Certificates will be made only upon presentation and surrender of
such Certificate at the Corporate Trust Office of the Trustee or at the
office of the New York Presenting Agent. If any payment required to be made
on the Certificates is to be made on a day that is not a Business Day, then
such payment will be made on the next succeeding Business Day.
(b) All distributions or allocations made with respect to
Certificateholders within each Class on each Distribution Date shall be
allocated among the outstanding Certificates in such Class equally in
proportion to their respective initial Certificate Principal Amounts (or
initial Notional Amounts).
Section 5.02. Distributions from the Certificate Account. (a) On
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each Distribution Date the Trustee (or the Paying Agent on behalf of the
Trustee) shall withdraw from the Certificate Account the Available
Distribution Amount and shall distribute such amount to the Holders of record
of each Class of Certificates in the following order of priority:
(i) to each Class of Senior Certificates (other than any Class of
Principal Only Certificates), the Accrued Certificate Interest thereon
for such Distribution Date, as reduced by such Class's pro rata share
(determined on the basis of Accrued Certificate Interest otherwise
distributable thereon) of any Net Prepayment Interest Shortfalls for
such Distribution Date; provided, however, that any shortfall in
available amounts shall be allocated among such Classes in proportion to
the respective amounts of Accrued Certificate Interest (as so reduced)
otherwise distributable thereon;
(ii) to each Class of Senior Certificates (other than any Class of
Principal Only Certificates), any related Interest Shortfall for such
Distribution Date; provided, however, that any shortfall in available
amounts shall be allocated among such Classes in proportion to the
Interest Shortfall for each such Class on such Distribution Date;
(iii) to the Classes of Senior Certificates, in reduction of the
Class Certificate Principal Amounts thereof, the Senior Principal
Distribution Amount, in the following order of priority:
first, to the Class A Certificates, until the Class
Certificate Principal Amount thereof has been reduced to zero; and
second, to the Class R Certificate, until the Class
Certificate Principal Amount thereof has been reduced to zero;
(iv) to the Class B1 Certificates, the Accrued Certificate Interest
thereon for such Distribution Date, as reduced by such Class's pro rata
share (determined on the basis of Accrued Certificate Interest otherwise
distributable thereon) of any Net Prepayment Interest Shortfalls for
such Distribution Date;
(v) to the Class B1 Certificates, any Interest Shortfall for such
Class on such Distribution Date;
(vi) to the Class B1 Certificates, in reduction of the Class
Certificate Principal Amount thereof, such Class's Subordinate Class
Percentage of the Subordinate Principal Distribution Amount for such
Distribution Date, except as provided in Section 5.02(c), until the
Class Certificate Principal Amount thereof has been reduced to zero;
(vii) to the Class B2 Certificates, the Accrued Certificate Interest
thereon for such Distribution Date, as reduced by such Class's pro rata
share (determined on the basis of Accrued Certificate Interest otherwise
distributable thereon) of any Net Prepayment Interest Shortfalls for
such Distribution Date;
(viii) to the Class B2 Certificates, any Interest Shortfall for such
Class on such Distribution Date;
(ix) to the Class B2 Certificates, in reduction of the Class
Certificate Principal Amount thereof, such Class's Subordinate Class
Percentage of the Subordinate Principal Distribution Amount for such
Distribution Date, except as provided in Section 5.02(c), until the
Class Certificate Principal Amount thereof has been reduced to zero;
(x) to the Class B3 Certificates, the Accrued Certificate Interest
thereon for such Distribution Date, as reduced by such Class's pro rata
share (determined on the basis of Accrued Certificate Interest otherwise
distributable thereon) of any Net Prepayment Interest Shortfalls for
such Distribution Date;
(xi) to the Class B3 Certificates, any Interest Shortfall for such
Class on such Distribution Date;
(xii) to the Class B3 Certificates, in reduction of the Class
Certificate Principal Amount thereof, such Class's Subordinate Class
Percentage of the Subordinate Principal Distribution Amount for such
Distribution Date, except as provided in Section 5.02(c), until the
Class Certificate Principal Amount thereof has been reduced to zero;
(xiii) to the Class B4 Certificates, the Accrued Certificate Interest
thereon for such Distribution Date, as reduced by such Class's pro rata
share (determined on the basis of Accrued Certificate Interest otherwise
distributable thereon) of any Net Prepayment Interest Shortfalls for
such Distribution Date;
(xiv) to the Class B4 Certificates, any Interest Shortfall for such
Class on such Distribution Date;
(xv) to the Class B4 Certificates, in reduction of the Class
Certificate Principal Amount thereof, such Class's Subordinate Class
Percentage of the Subordinate Principal Distribution Amount for such
Distribution Date, except as provided in Section 5.02(c), until the
Class Certificate Principal Amount thereof has been reduced to zero;
(xvi) to the Class B5 Certificates, the Accrued Certificate Interest
thereon for such Distribution Date, as reduced by such Class's pro rata
share (determined on the basis of Accrued Certificate Interest otherwise
distributable thereon) of any Net Prepayment Interest Shortfalls for
such Distribution Date;
(xvii) to the Class B5 Certificates, any Interest Shortfall for such
Class on such Distribution Date;
(xviii) to the Class B5 Certificates, in reduction of the Class
Certificate Principal Amount thereof, such Class's Subordinate Class
Percentage of the Subordinate Principal Distribution Amount for such
Distribution Date, except as provided in Section 5.02(c), until the
Class Certificate Principal Amount thereof has been reduced to zero;
(xix) to the Class B6 Certificates, the Accrued Certificate Interest
thereon for such Distribution Date, as reduced by such Class's pro rata
share (determined on the basis of Accrued Certificate Interest otherwise
distributable thereon) of any Net Prepayment Interest Shortfalls for
such Distribution Date;
(xx) to the Class B6 Certificates, any Interest Shortfall for such
Class on such Distribution Date; and
(xxi) to the Class B6 Certificates, in reduction of the Class
Certificate Principal Amount thereof, such Class's Subordinate Class
Percentage of the Subordinate Principal Distribution Amount for such
Distribution Date, except as provided in Section 5.02(c), until the
Class Certificate Principal Amount thereof has been reduced to zero.
(b) If on any Distribution Date the Class Certificate Principal Amounts
of the Subordinate Certificates have each been reduced to zero, the amounts
distributable to the Senior Certificates pursuant to Section 5.02(a)(iii) for
such Distribution Date and each succeeding Distribution Date shall be
allocated among such Classes of Senior Certificates pro rata, on the basis of
their respective Class Certificate Principal Amounts immediately prior to
such Distribution Date, regardless of the priorities and amounts set forth in
Section 5.02(a)(iii).
(c) (i) If on any Distribution Date the Credit Support Percentage for
the Class B1 Certificates is less than the Original Credit Support Percentage
for such Class, then, notwithstanding anything to the contrary in Section
5.02(a), no distribution of amounts described in clauses (ii) and (iii) of
the definition of Subordinate Principal Distribution Amount will be made to
the Class B2, Class B3, Class B4, Class B5 or Class B6 Certificates on such
Distribution Date. (ii) If on any Distribution Date the Credit Support
Percentage for the Class B2 Certificates is less than the Original Credit
Support Percentage for such Class, then, notwithstanding anything to the
contrary in Section 5.02(a), no distribution of amounts described in clauses
(ii) and (iii) of the definition of Subordinate Principal Distribution Amount
will be made to the Class B3, Class B4, Class B5 or Class B6 Certificates on
such Distribution Date. (iii) If on any Distribution Date the Credit Support
Percentage for the Class B3 Certificates is less than the Original Credit
Support Percentage for such Class, then, notwithstanding anything to the
contrary in Section 5.02(a), no distribution of amounts described in clauses
(ii) and (iii) of the definition of Subordinate Principal Distribution Amount
will be made to the Class B4, Class B5 or Class B6 Certificates on such
Distribution Date. (iv) If on any Distribution Date the Credit Support
Percentage for the Class B4 Certificates is less than the Original Credit
Support Percentage for such Class, then, notwithstanding anything to the
contrary in Section 5.02(a), no distribution of amounts described in clauses
(ii) and (iii) of the definition of Subordinate Principal Distribution Amount
will be made to the Class B5 or Class B6 Certificates on such Distribution
Date. (v) If on any Distribution Date the Credit Support Percentage for the
Class B5 Certificates is less than the Original Credit Support Percentage for
such Class, then, notwithstanding anything to the contrary in Section
5.02(a), no distribution of amounts described in clauses (ii) and (iii) of
the definition of Subordinate Principal Distribution Amount will be made to
the Class B6 Certificates on such Distribution Date.
Any amount not distributed to any Classes of Subordinate Certificates on
any Distribution Date pursuant to the immediately preceding paragraph will be
allocated among the remaining Classes of Subordinate Certificates in
proportion to their respective Class Certificate Principal Amounts.
(d) On each Distribution Date, the Trustee shall distribute to the
Holder of the Class R Certificate any remaining Available Distribution Amount
for such Distribution Date after application of all amounts described in
paragraph (a) of this Section 5.02. Any distributions pursuant to this
paragraph (d) shall not reduce the Class Certificate Principal Amount of the
Class R Certificate.
Section 5.03. Allocation of Realized Losses. (a) On any
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Distribution Date, the principal portion of each Realized Loss (other than
any Excess Loss) shall be allocated in the following order of priority:
first, to the Class B6 Certificates, until the Class
Certificate Principal Amount thereof has been reduced to zero;
second, to the Class B5 Certificates, until the Class
Certificate Principal Amount thereof has been reduced to zero;
third, to the Class B4 Certificates, until the Class
Certificate Principal Amount thereof has been reduced to zero;
fourth, to the Class B3 Certificates, until the Class
Certificate Principal Amount thereof has been reduced to zero;
fifth, to the Class B2 Certificates, until the Class
Certificate Principal Amount thereof has been reduced to zero;
sixth, to the Class B1 Certificates, until the Class
Certificate Principal Amount thereof has been reduced to zero; and
seventh, to the Classes of Senior Certificates, pro rata, in
accordance with their Class Certificate Principal Amounts;
provided, that any such loss allocated to any Class of Accrual
Certificates (and any Accrual Component) shall be allocated
(subject to Section 5.03(c)) on the basis of the lesser of (x) the
Class Certificate Principal Amount (or Component Principal Amount)
thereof immediately prior to the applicable Distribution Date and
(y) the Class Certificate Principal Amount (or Component Principal
Amount) thereof on the Closing Date (as reduced by any Realized
Losses previously allocated thereto).
(b) With respect to any Distribution Date, the principal portion of any
Excess Loss shall be allocated among the Classes of Certificates, pro rata,
based on the respective Class Certificate Principal Amounts thereof;
provided, that any such loss allocated to any Class of Accrual Certificates
(and any Accrual Component) shall be allocated (subject to Section 5.03(c))
on the basis of the lesser of (x) the Class Certificate Principal Amount (or
Component Principal Amount) thereof immediately prior to the applicable
Distribution Date and (y) the Class Certificate Principal Amount (or
Component Principal Amount) thereof on the Closing Date (as reduced by any
Realized Losses previously allocated thereto).
(c) Any Realized Losses allocated to a Class of Certificates pursuant
to Section 5.03(a) or (b) shall be allocated among the Certificates of such
Class in proportion to their respective Certificate Principal Amounts. In
addition, any Realized Losses allocated to any Class of Component
Certificates on a Distribution Date shall be allocated in reduction of the
Component Principal Amounts of the related Components (other than any
Notional Component) in proportion to their respective Component Principal
Amounts immediately prior to such Distribution Date. Any allocation of
Realized Losses pursuant to this paragraph (c) shall be accomplished by
reducing the Certificate Principal Amount (or, in the case of any Component,
the Component Principal Amount) of the related Certificates (or Components)
on the related Distribution Date in accordance with Section 5.03(d).
(d) Realized Losses allocated in accordance with this Section 5.03
shall be allocated on the Distribution Date in the month following the month
in which such loss was incurred and, in the case of the principal portion
thereof, after giving effect to distributions made on such Distribution Date.
(e) On each Distribution Date, the Subordinate Certificate Writedown
Amount for such date shall effect a corresponding reduction in the
Certificate Principal Amount of the lowest ranking Class of outstanding
Subordinate Certificates, which reduction shall occur on such Distribution
Date after giving effect to distributions made on such Distribution Date.
(f) In the event that there is a recovery of an amount in respect of
principal of a Mortgage Loan, which amount had previously been allocated as a
Realized Loss to one or more Classes of Certificates and, if applicable, to
one or more Components, each outstanding Class or Component to which any
portion of such Realized Loss had previously been allocated shall be entitled
to receive, on the Distribution Date in the month following the month in
which such recovery is received, its pro rata share (based on the Class
Certificate Principal Amount thereof) of such recovery, up to the amount of
the portion of such Realized Loss previously allocated to such Class. A
Class of Certificates that is no longer outstanding shall not be entitled to
any share of such recovery. In the event that the total amount of such
recovery exceeds the amount of such recovery allocated to the outstanding
Classes in accordance with the preceding provisions, each outstanding Class
of Certificates or Component shall be entitled to receive its pro rata share
of the amount of such excess, up to the amount of any unrecovered Realized
Loss previously allocated to such Class. Any such amounts not otherwise
allocated to any Class of Certificates pursuant to this subsection shall be
treated as Principal Prepayments for purposes of this Agreement.
Section 5.04. Trustee Advances. In the event that the Servicer
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fails for any reason to make an Advance required to be made by it pursuant to
the Sale and Servicing Agreement on or before the Remittance Date, the
Trustee shall, on or before the related Distribution Date, deposit in the
Certificate Account an amount equal to the excess of (a) Advances required to
be made by the Servicer that would have been deposited in such Certificate
Account over (b) the amount of any Advance made by the Servicer with respect
to such Distribution Date; provided, however, that
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the Trustee shall be required to make such Advance only if it is not
prohibited by law from doing so and it has determined that such Advance would
be recoverable from amounts to be received with respect to such Mortgage
Loan, including Liquidation Proceeds, Insurance Proceeds, or otherwise. The
Trustee shall be entitled to be reimbursed from the Certificate Account for
Advances made by it pursuant to this Section 5.04 as if it were the Servicer.
Section 5.05. Distributions of Principal on Redemption Certificates.
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(a) Except as provided in subclauses (d) and (f) below, on each Distribution
Date on which distributions in reduction of the Class Certificate Principal
Amount of a Class of Redemption Certificates are made, such distributions
will be made in the following order of priority:
(i) any request by the personal representative of a Deceased
Holder or by a surviving tenant by the entirety, by a surviving joint
tenant or by a surviving tenant in common or other Person empowered to
act on behalf of such Deceased Holder upon his or her death, in an
amount up to but not exceeding $100,000 per request; and
(ii) any request by a Living Holder, in an amount up to but not
exceeding $10,000 per request.
Thereafter, distributions will be made as provided in clauses (i) and
(ii) above up to a second $100,000 and $10,000 per request, respectively.
This sequence of priorities will be repeated for each request for principal
distributions made by the Certificate Owners of a Class of Redemption
Certificates until all such requests have been honored.
Requests for distributions in reduction of the Certificate Principal
Amounts of Redemption Certificates presented on behalf of Deceased Holders in
accordance with the provisions of clause (i) above will be accepted in the
order of their receipt by the Clearing Agency. Requests for distributions in
reduction of the Certificate Principal Amounts of Redemption Certificates
presented in accordance with the provisions of clause (ii) above will be
accepted in the order of priority established by the random lot procedures of
the Clearing Agency after all requests with respect to such Class presented
in accordance with clause (i) have been honored. All requests for
distributions in reduction of the Class Certificate Principal Amount of a
Class of Redemption Certificates with respect to any Distribution Date shall
be made in accordance with Section 4.03(c) below and must be received by the
Clearing Agency and forwarded to, and received by, the Trustee no later than
the close of business on the related Record Date. Requests for distributions
that are received by the Clearing Agency and forwarded to the Trustee after
the related Record Date and requests, in either case, for distributions
timely received but not accepted with respect to any Distribution Date, will
be treated as requests for distributions in reduction of the Class
Certificate Principal Amount of the applicable Class of Redemption
Certificates on the next succeeding Distribution Date, and each succeeding
Distribution Date thereafter, until each such request is accepted or is
withdrawn as provided in Section 5.05(c). Such requests as are not so
withdrawn shall retain their order of priority without the need for any
further action on the part of the appropriate Certificate Owner of the
related Redemption Certificate, all in accordance with the procedures of the
Clearing Agency and the Trustee. Upon the transfer of beneficial ownership
of any Redemption Certificate, any distribution request previously submitted
with respect to such Certificate will be deemed to have been withdrawn only
upon the receipt by the Trustee of notification of such withdrawal using a
form required by the Clearing Agency.
Distributions in reduction of the Certificate Principal Amounts of
Redemption Certificates will be applied, in the aggregate, to such
Certificates in an amount equal to the portion of the Available Distribution
Amount distributable to the Redemption Certificates pursuant to Section
5.02(a)(iv), plus any amounts available for distribution from the applicable
Rounding Account pursuant to Section 5.05(e), provided that
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the aggregate distribution in reduction of the Class Certificate Principal
Amount of any Class of Redemption Certificates on any Distribution Date is
made in an integral multiple of $1,000.
(b) A "Deceased Holder" is a Certificate Owner of a Redemption
Certificate who was living at the time such interest was acquired and whose
authorized personal representative, surviving tenant by the entirety,
surviving joint tenant or surviving tenant in common or other Person
empowered to act on behalf of such Certificate Owner upon his or her death,
causes to be furnished to the Trustee a certified copy of the death
certificate of such Certificate Owner and any additional evidence of death
required by and satisfactory to the Trustee and any tax waivers requested by
the Trustee. Redemption Certificates beneficially owned by tenants by the
entirety, joint tenants or tenants in common will be considered to be
beneficially owned by a single owner. The death of a tenant by the entirety,
joint tenant or tenant in common will be deemed to be the death of the
Certificate Owner, and any Redemption Certificates so beneficially owned will
be eligible for priority with respect to distributions in reduction of the
Class Certificate Principal Amount of such Class of Redemption Certificates,
subject to the limitations stated above. Redemption Certificates
beneficially owned by a trust will be considered to be beneficially owned by
each beneficiary of the trust to the extent of such beneficiary's beneficial
interest therein, but in no event will a trust's beneficiaries collectively
be deemed to be Certificate Owners of a number of Individual Redemption
Certificates greater than the number of Individual Redemption Certificates of
which such trust is the beneficial owner. The death of a beneficiary of a
trust will be deemed to be the death of a Certificate Owner of the Redemption
Certificates beneficially owned by the trust to the extent of such
beneficiary's beneficial interest in such trust. The death of an individual
who was a tenant by the entirety, joint tenant or tenant in common in a
tenancy that is the beneficiary of a trust will be deemed to be the death of
the beneficiary of the trust. The death of a person who, during his or her
lifetime, was entitled to substantially all of the beneficial ownership
interests in Redemption Certificates will be deemed to be the death of the
Certificate Owner of such Redemption Certificates regardless of the
registration of ownership of such Redemption Certificates, if such beneficial
interest can be established to the satisfaction of the Trustee. Such
beneficial interest will be deemed to exist in typical cases of street name
or nominee ownership, ownership by a trustee, ownership under the Uniform
Gifts to Minors Act and community property or other joint ownership
arrangements between a husband and wife. Beneficial interests shall include
the power to sell, transfer or otherwise dispose of a Redemption Certificate
and the right to receive the proceeds therefrom, as well as interest and
distributions in reduction of the Certificate Principal Amounts of the
Redemption Certificates payable with respect thereto. The Trustee shall not
be under any duty to determine independently the occurrence of the death of
any deceased Certificate Owner. The Trustee may rely entirely upon
documentation delivered to it pursuant to Section 5.05(a) in establishing the
eligibility of any Certificate Owner to receive the priority accorded
Deceased Holders in Section 5.05(a).
(c) Requests for distributions in reduction of the Certificate
Principal Amount of a Redemption Certificate must be made by delivering a
written request therefor to the Clearing Agency Participant or Financial
Intermediary that maintains the account evidencing the Certificate Owner's
interest in such Redemption Certificate. Such Clearing Agency Participant or
Financial Intermediary should in turn make the request of the Clearing Agency
(or, in the case of an Financial Intermediary, such Financial Intermediary
should notify the related Clearing Agency Participant of such request, which
Clearing Agency Participant should make the request of the Clearing Agency)
on a form required by the Clearing Agency and provided to the Clearing Agency
Participant. Upon receipt of such request, the Clearing Agency will date and
time stamp such request and forward such request to the Trustee. The
Clearing Agency may establish such procedures as it deems fair and equitable
to establish the order of receipt of requests for such distributions received
by it on the same day. The Trustee shall not be liable for any delay in
delivery of requests for distributions or withdrawals of such requests by the
Clearing Agency, a Clearing Agency Participant or any Financial Intermediary.
In the event that any requests for distributions in reduction of
the Certificate Principal Amount of Redemption Certificates are rejected by
the Trustee for failure to comply with the requirements of this Section 5.05,
the Trustee shall return such requests to the appropriate Clearing Agency
Participant with a copy to the Clearing Agency with an explanation as to the
reason for such rejection.
The Trustee shall maintain a list of those Clearing Agency
Participants representing the Certificate Owners of Redemption Certificates
that have submitted requests for distributions in reduction of the
Certificate Principal Amount of such Redemption Certificates, together with
the order of receipt and the amounts of such requests. The Trustee shall
notify the Clearing Agency and the appropriate Clearing Agency Participants
as to which requests should be honored on each Distribution Date. Requests
shall be honored by the Clearing Agency in accordance with the procedures,
and subject to the priorities and limitations, described in this Section
5.05. The exact procedures to be followed by the Trustee and the Clearing
Agency for purposes of determining such priorities and limitations shall be
those established from time to time by the Trustee or the Clearing Agency, as
the case may be. The decisions of the Trustee and the Clearing Agency
concerning such matters shall be final and binding on all affected Persons.
Payments in reduction of the Certificate Principal Amounts of
Redemption Certificates shall be made on the applicable Distribution Date and
the Certificate Balances as to which such payments are made shall cease to
bear interest after the last day of the month preceding the month in which
such Distribution Date occurs.
Any Certificate Owner of a Redemption Certificate that has
requested a distribution may withdraw its request by so notifying in writing
the Clearing Agency Participant or Financial Intermediary that maintains such
Certificate Owner's account. In the event that such account is maintained by
a Financial Intermediary, such Financial Intermediary should notify the
related Clearing Agency Participant which in turn should forward the
withdrawal of such request, on a form required by the Clearing Agency, to the
Trustee. If such notice of withdrawal of a request for distribution has not
been received by the Clearing Agency and forwarded to the Trustee on or
before the Record Date for the next Distribution Date, the previously made
request for distribution will be irrevocable with respect to the making of
distributions in reduction of the Certificate Principal Amount of such
Redemption Certificate on such Distribution Date.
(d) To the extent, if any, that amounts available for distribution in
reduction of the Class Certificate Principal Amount of any Class of
Redemption Certificates on a Distribution Date exceed the dollar amount of
requests for distributions with respect to such Class that have been received
by the related Record Date, as provided in Section 5.05(c) above,
distributions in reduction of the Class Certificate Principal Amount of such
Class of Redemption Certificates will be made by mandatory distributions in
reduction thereof. The Trustee shall notify the Clearing Agency of the
aggregate amount of the mandatory distribution in reduction of the Class
Certificate Principal Amount of such Class of Redemption Certificates to be
made on the next Distribution Date. The Clearing Agency shall then allocate
such aggregate amount among its Clearing Agency Participants on a random lot
basis. Each Clearing Agency Participant and, in turn, each Financial
Intermediary, will then select, in accordance with its own procedures,
Individual Redemption Certificates from among those held in its accounts to
receive mandatory distributions in reduction of the Class Certificate
Principal Amount of such Class of Redemption Certificates, such that the
total amount so selected is equal to the aggregate amount of such mandatory
distributions allocated to such Clearing Agency Participant by the Clearing
Agency and to such Financial Intermediary by its related Clearing Agency
Participant, as the case may be. Clearing Agency Participants and Financial
Intermediaries that hold Redemption Certificates selected for mandatory
distributions in reduction of the Class Certificate Principal Amount thereof
should provide notice of such mandatory distributions to the affected
Certificate Owners.
(e) On the Closing Date, a Rounding Account shall be established with
the Trustee for each Class of Redemption Certificates, and Xxxxxx Brothers
Inc. shall cause to be initially deposited the sum of $999.99 in each
Rounding Account. On each Distribution Date on which a distribution is made
in reduction of the Class Certificate Principal Amount of a Class of
Redemption Certificates, funds on deposit in the applicable Rounding Account
shall be, to the extent needed, withdrawn by the Trustee and applied to round
upward to an integral multiple of $1,000 the aggregate distribution in
reduction of the Class Certificate Principal Amount to be made on such
Redemption Certificates. Rounding of such distribution on such Redemption
Certificates shall be accomplished, on the first such Distribution Date, by
withdrawing from the applicable Rounding Account the amount of funds, if any,
needed to round the amount otherwise available for such distribution in
reduction of the Class Certificate Principal Amount of such Class of
Redemption Certificates upward to the next integral multiple of $1,000. On
each succeeding Distribution Date on which distributions in reduction of the
Class Certificate Principal Amount of such Class of Redemption Certificates
are to be made, the aggregate amount of such distributions allocable to such
Class of Redemption Certificates shall be applied first to repay any funds
withdrawn from the applicable Rounding Account and not previously repaid, and
then the remainder of such allocable amount, if any, shall be similarly
rounded upward and applied as distributions in reduction of the Class
Certificate Principal Amount of such Class of Redemption Certificates; this
process shall continue on succeeding Distribution Dates until the Class
Certificate Principal Amount of such Class of Redemption Certificates has
been reduced to zero. Each Rounding Account shall be an "outside reserve
fund" under the REMIC Provisions that is beneficially owned for all federal
income tax purposes by Xxxxxx Brothers Inc. Xxxxxx Brothers Inc. will report
all income, gain, deduction or loss with respect thereto. The Trustee shall
distribute interest earnings, if any, on amounts held in any Rounding Account
as such interest is earned pursuant to written instructions from Xxxxxx
Brothers Inc. to the Trustee.
Notwithstanding anything herein to the contrary, on the Distribution
Date on which distributions in reduction of the Class Certificate Principal
Amount of any Class of Redemption Certificates will reduce the Class
Certificate Principal Amount thereof to zero or in the event that
distributions in reduction of the Class Certificate Principal Amount of such
Class of Redemption Certificates are made in accordance with the provisions
set forth in Section 5.05(f), an amount equal to the difference between
$999.99 and the sum then held in the applicable Rounding Account shall be
paid from the Available Distribution Amount for such Distribution Date to
such Rounding Account. Any funds then on deposit in such Rounding Account
shall be distributed to Xxxxxx Brothers Inc.
(f) Notwithstanding any provisions herein to the contrary, on each
Distribution Date following the first Distribution Date on or after the
Credit Support Depletion Date, all distributions in reduction of the Class
Certificate Principal Amount of any Class of Redemption Certificates will be
made among the Holders of such Class of Certificates, pro rata, based on
their Certificate Principal Amounts, and will not be made in integral
multiples of $1,000 or pursuant to requested distributions or mandatory
distributions by random lot.
(g) In the event that Definitive Certificates representing any Class of
Redemption Certificates are issued pursuant to Section 3.09(c), all requests
for distributions or withdrawals of such requests relating to such Class must
be submitted to the Trustee, and the Trustee shall perform the functions
described in Section 5.05(a) through (c) using its own procedures, which
procedures shall, to the extent practicable, be consistent with the
procedures described in Section 5.05(a) through (c).
ARTICLE VI
CONCERNING THE TRUSTEE; EVENTS OF DEFAULT
Section 6.01. Duties of Trustee. (a) The Trustee, except during
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the continuance of an Event of Default, undertakes to perform such duties and
only such duties as are specifically set forth in this Agreement. Any
permissive right of the Trustee provided for in this Agreement shall not be
construed as a duty of the Trustee. If an Event of Default has occurred and
has not otherwise been cured or waived, the Trustee shall exercise such of
the rights and powers vested in it by this Agreement and use the same degree
of care and skill in their exercise as a prudent Person would exercise or use
under the circumstances in the conduct of such Person's own affairs unless
the Trustee is acting as Servicer, in which case it shall use the same degree
of care and skill as the Servicer under the Sale and Servicing Agreement.
The Trustee may appoint a custodian to maintain custody of the Mortgage
Loans and to perform certain administrative functions on behalf of the
Trustee, to the extent provided herein. The reasonable compensation of any
such custodian shall be paid by the Trustee, and shall be reimbursable to the
Trustee from the Certificate Account.
(b) The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments
furnished to the Trustee which are specifically required to be furnished
pursuant to any provision of this Agreement, shall examine them to determine
whether they are in the form required by this Agreement; provided, however,
that the Trustee shall not be responsible for the accuracy or content of any
such resolution, certificate, statement, opinion, report, document, order or
other instrument furnished by the Servicer, to the Trustee pursuant to this
Agreement.
(c) The Trustee shall not have any liability arising out of or in
connection with this Agreement, except for its negligence or willful
misconduct. No provision of this Agreement shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent
failure to act or its own willful misconduct; provided, however, that:
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(i) 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 as provided in
Section 6.19 hereof;
(ii) For all purposes under this Agreement, the Trustee shall not
be deemed to have notice of any Event of Default (other than resulting
from a failure by the Servicer (i) to remit funds (or to make Servicing
Advances) or (ii) to furnish information to the Trustee when required to
do so by the Sale and Servicing Agreement) unless a Responsible Officer
of the Trustee has actual knowledge thereof or unless written notice of
any event which is in fact such a default is received by the Trustee at
the Corporate Trust Office, and such notice references the Holders of
the Certificates and this Agreement;
(iii) No provision of this Agreement shall require the Trustee to
expend or risk its own funds or otherwise incur any financial liability
in the performance of any of its duties hereunder, or in the exercise of
any of its rights or powers, if it shall have reasonable grounds for
believing that repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it; and
(iv) The Trustee shall not be responsible for any act or omission
of the Servicer.
(d) The Trustee shall have no duty hereunder with respect to any
complaint, claim, demand, notice or other document it may receive or which
may be alleged to have been delivered to or served upon it by the parties as
a consequence of the assignment of any Mortgage Loan hereunder; provided,
however, that the Trustee shall use its best efforts to remit to the Servicer
upon receipt any such complaint, claim, demand, notice or other document (i)
which is delivered to the Corporate Trust Office of the Trustee, (ii) of
which a Responsible Officer has actual knowledge, and (iii) which contains
information sufficient to permit the Trustee to make a determination that the
real property to which such document relates is a Mortgaged Property.
(e) 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 Certificateholders of any Class holding
Certificates which evidence, as to such Class, Percentage Interests
aggregating not less than 25% as 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.
Section 6.02. Certain Matters Affecting the Trustee. Except as
-------------------------------------
otherwise provided in Section 6.01:
(i) The Trustee may request, and may rely 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,
approval, bond or other paper or document believed by it to be genuine
and to have been signed or presented by the proper party or parties;
(ii) The Trustee may consult with counsel and any advice of its
counsel or Opinion of Counsel shall be full and complete authorization
and protection in respect of any action taken or suffered or omitted by
it hereunder in good faith and in accordance with such advice or Opinion
of Counsel;
(iii) The Trustee shall not be personally liable for any action
taken, suffered or omitted by it in good faith and reasonably believed
by it to be authorized or within the discretion or rights or powers
conferred upon it by this Agreement;
(iv) Unless an Event of Default shall have occurred and be
continuing, 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 (provided the same appears
regular on its face), unless requested in writing to do so by Holders of
at least a majority in Class Certificate Principal Amount (or Aggregate
Notional Amount) of each Class of Certificates; provided, however, that,
if the payment within a reasonable time to
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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 the security afforded to it by the terms
of this Agreement, the Trustee may require reasonable indemnity against such
expense or liability or payment of such estimated expenses as a condition to
proceeding. The reasonable expense thereof shall be paid by the Holders
requesting such investigation; and
(v) 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, which agents or attorneys shall have any or all of the
rights, powers, duties and obligations of the Trustee conferred on them
by such appointment provided that the Trustee shall continue to be
responsible for its duties and obligations hereunder.
Section 6.03. Trustee Not Liable for Certificates. The Trustee
-----------------------------------
makes no representations as to the validity or sufficiency of this Agreement
or of the Certificates (other than the certificate of authentication on the
Certificates) or of any Mortgage Loan, or related document save that the
Trustee represents that, assuming due execution and delivery by the other
parties hereto, this Agreement has been duly authorized, executed and
delivered by it and constitutes its valid and binding obligation, enforceable
against it in accordance with its terms except that such enforceability may
be subject to (A) applicable bankruptcy and insolvency laws and other similar
laws affecting the enforcement of the rights of creditors generally, and (B)
general principles of equity regardless of whether such enforcement is
considered in a proceeding in equity or at law. The Trustee shall not be
accountable for the use or application by the Depositor of funds paid to the
Depositor in consideration of the assignment of the Mortgage Loans to the
Trust Fund by the Depositor or for the use or application of any funds
deposited into the Certificate Account or any other fund or account
maintained with respect to the Certificates.
Section 6.04. Trustee May Own Certificates. The Trustee and any
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Affiliate or agent of the Trustee in its individual or any other capacity may
become the owner or pledgee of Certificates and may transact banking and
trust with the other parties hereto with the same rights it would have if it
were not Trustee or such agent.
Section 6.05. Eligibility Requirements for Trustee. The Trustee
------------------------------------
hereunder shall at all times be (i) an institution insured by the FDIC and
(ii) a corporation or national banking association, organized and doing
business under the laws of any State or the United States of America,
authorized under such laws to exercise corporate trust powers, having a
combined capital and surplus of not less than $50,000,000 and subject to
supervision or examination by federal or state authority. If such
corporation or national banking association publishes reports of condition at
least annually, pursuant to law or to the requirements of the aforesaid
supervising or examining authority, then, for the purposes of this Section,
the combined capital and surplus of such corporation or national banking
association shall be deemed to be its combined capital and surplus as set
forth in its most recent report of condition so published. In case at any
time the Trustee shall cease to be eligible in accordance with provisions of
this Section, the Trustee shall resign immediately in the manner and with the
effect specified in Section 6.06.
Section 6.06. Resignation and Removal of Trustee. (a) The Trustee
----------------------------------
may at any time resign and be discharged from the trust hereby created by
giving written notice thereof to the Depositor. Upon receiving such notice
of resignation, the Depositor will promptly appoint a successor trustee by
written instrument, one copy of which instrument shall be delivered to the
resigning Trustee, and one copy to the successor trustee. If no successor
trustee shall have been so appointed and shall 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.
(b) If at any time (i) the Trustee shall cease to be eligible in
accordance with the provisions of Section 6.05 and shall fail to resign after
written request therefor by the Depositor, (ii) the Trustee shall become
incapable of acting, or shall be adjudged a 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, (iii)
a tax is imposed or threatened with respect to the Trust Fund by any state in
which the Trustee or the Trust Fund held by the Trustee is located, or (iv)
the continued use of the Trustee would result in a downgrading of the rating
by the Rating Agencies of any Class of Certificates with a rating, then the
Depositor may remove the Trustee and appoint a successor trustee by written
instrument, one copy of which instrument shall be delivered to the Trustee so
removed and one copy to the successor trustee.
(c) The Holders of more than 50% of the Class Certificate Principal
Amount (or Aggregate Notional Amount) of each Class of Certificates may at
any time upon 30 days' written notice to the Trustee and to the Depositor
remove the Trustee by such written instrument, signed by such Holders or
their attorney-in-fact duly authorized, one copy of which instrument shall be
delivered to the Depositor and one copy to the Trustee so removed; the
Depositor shall thereupon use its best efforts to appoint a mutually
acceptable successor trustee in accordance with this Section.
(d) Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to any of the provisions of this Section shall
become effective upon acceptance of appointment by the successor trustee as
provided in Section 6.07.
Section 6.07. Successor Trustee. (a) Any successor trustee
-----------------
appointed as provided in Section 6.06 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 the
predecessor trustee shall become effective and such successor trustee,
without any further act, deed or conveyance, shall become fully vested with
all the rights, powers, duties and obligations of its predecessor hereunder,
with like effect as if originally named as trustee herein. The predecessor
trustee shall deliver to the successor trustee all Mortgage Files and
documents and statements related to each Mortgage Files held by it hereunder,
and shall duly assign, transfer, deliver and pay over to the successor
trustee the entire Trust Fund, together with all necessary instruments of
transfer and assignment or other documents properly executed necessary to
effect such transfer and such of the record or copies thereof maintained by
the predecessor trustee in the administration hereof as may be requested by
the successor trustee and shall thereupon be discharged from all duties and
responsibilities under this Agreement. In addition, the predecessor trustee
shall execute and deliver such other instruments and do such other things as
may reasonably be required to more fully and certainly vest and confirm in
the successor trustee all such rights, powers, duties and obligations.
(b) No successor trustee shall accept appointment as provided in this
Section unless at the time of such appointment such successor trustee shall
be eligible under the provisions of Section 6.05.
(c) 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 and to the Rating Agencies. The expenses of such
mailing shall be borne by the Depositor.
Section 6.08. Merger or Consolidation of Trustee. Any Person into
----------------------------------
which the Trustee may be merged or with which it may be consolidated, or any
Person resulting from any merger, conversion or consolidation to which the
Trustee shall be a party, or any Persons succeeding to the business of the
Trustee, shall be the successor of the Trustee 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
that such Person shall be eligible under the provisions of Section 6.05.
Section 6.09. Appointment of Co-Trustee, Separate Trustee or
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Custodian. (a) Notwithstanding any other provisions hereof, at any time,
---------
the Trustee, the Depositor or the Certificateholders
evidencing more than 50% of the Class Certificate Principal Amount (or
Aggregate Notional Amount) of each Class of Certificates shall each have the
power from time to time to appoint one or more Persons to act either as
co-trustees jointly with the Trustee, or as separate trustees, or as
custodians, for the purpose of holding title to, foreclosing or otherwise
taking action with respect to any Mortgage Loan outside the state where the
Trustee has its principal place of business where such separate trustee or
co-trustee is necessary or advisable under the laws of any state in which a
property securing a Mortgage Loan is located or for the purpose of otherwise
conforming to any legal requirement, restriction or condition in any state in
which a property securing a Mortgage Loan is located or in any state in which
any portion of the Trust Fund is located. The separate Trustees,
co-trustees, or custodians so appointed shall be trustees or custodians for
the benefit of all the Certificateholders and shall have such powers, rights
and remedies as shall be specified in the instrument of appointment;
provided, however, that no such appointment
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shall, or shall be deemed to, constitute the appointee an agent of the
Trustee. The obligation of the Trustee to make Advances pursuant to Section
5.04 and 6.14 hereof shall not be affected or assigned by the appointment of
a co-trustee.
(b) Every separate trustee, co-trustee, and custodian shall, to the
extent permitted by law, be appointed and act subject to the following
provisions and conditions:
(i) all powers, duties, obligations and rights conferred upon the
Trustee in respect of the receipt, custody and payment of moneys shall
be exercised solely by the Trustee;
(ii) all other rights, powers, duties and obligations conferred or
imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee,
co-trustee, or custodian jointly, except to the extent that under any
law of any jurisdiction in which any particular act or acts are to be
performed the Trustee shall be incompetent or unqualified to perform
such act or acts, in which event such rights, powers, duties and
obligations, including the holding of title to the Trust Fund or any
portion thereof in any such jurisdiction, shall be exercised and
performed by such separate trustee, co-trustee, or custodian;
(iii) no trustee or custodian hereunder shall be personally liable
by reason of any act or omission of any other trustee or custodian
hereunder; and
(iv) the Trustee or the Certificateholders evidencing more than 50%
of the Aggregate Voting Interests of the Certificates may at any time
accept the resignation of or remove any separate trustee, co-trustee or
custodian, so appointed by it or them, if such resignation or removal
does not violate the other terms of this Agreement.
(c) Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee, co-trustee or custodian shall refer to this
Agreement and the conditions of this Article VI. Each separate trustee and
co-trustee, upon its acceptance of the trusts conferred, shall be vested with
the estates or property specified in its instrument of appointment, either
jointly with the Trustee or separately, as may be provided therein, subject
to all the provisions of this Agreement, specifically including every
provision of this Agreement relating to the conduct of, affecting the
liability of, or affording protection to, the Trustee. Every such instrument
shall be filed with the Trustee.
(d) Any separate trustee, co-trustee or custodian may, at any time,
constitute the Trustee its agent or attorney-in-fact with full power and
authority, to the extent not prohibited by law, to do any lawful act under or
in respect of this Agreement on its behalf and in its name. If any separate
trustee, co-trustee or custodian shall die, become incapable of acting,
resign or be removed, all of its estates, properties, rights, remedies and
trusts shall vest in and be exercised by the Trustee, to the extent permitted
by law, without the appointment of a new or successor trustee.
(e) No separate trustee, co-trustee or custodian hereunder shall be
required to meet the terms of eligibility as a successor trustee under
Section 6.05 hereunder and no notice to Certificateholders of the appointment
shall be required under Section 6.07 hereof.
(f) The Trustee agrees to instruct the co-trustees, if any, to the
extent necessary to fulfill the Trustee's obligations hereunder.
(g) The Trustee shall pay the reasonable compensation of the
co-trustees to the extent, and in accordance with the standards, specified in
Section 6.12 hereof (which compensation shall not reduce any compensation
payable to the Trustee under such Section).
Section 6.10. Authenticating Agents. (a) The Trustee may appoint
---------------------
one or more Authenticating Agents which shall be authorized to act on behalf
of the Trustee in authenticating Certificates. Wherever reference is made in
this Agreement to the authentication of Certificates by the Trustee or the
Trustee's certificate of authentication, such reference shall be deemed to
include authentication on behalf of the Trustee by an Authenticating Agent
and a certificate of authentication executed on behalf of the Trustee by an
Authenticating Agent. Each Authenticating Agent must be a corporation
organized and doing business under the laws of the United States of America
or of any state, having a combined capital and surplus of at least
$15,000,000, authorized under such laws to do a trust business and subject to
supervision or examination by federal or state authorities.
(b) Any Person into which any Authenticating Agent may be merged or
converted or with which it may be consolidated, or any Person resulting from
any merger, conversion or consolidation to which any Authenticating Agent
shall be a party, or any Person succeeding to the corporate agency business
of any Authenticating Agent, shall continue to be the Authenticating Agent
without the execution or filing of any paper or any further act on the part
of the Trustee or the Authenticating Agent.
(c) Any Authenticating Agent may at any time resign by giving at least
30 days' advance written notice of resignation to the Trustee and the
Depositor. The Trustee may at any time terminate the agency of any
Authenticating Agent by giving written notice of termination to such
Authenticating Agent and the Depositor. Upon receiving a notice of
resignation or upon such a termination, or in case at any time any
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section 6.10, the Trustee may appoint a successor
Authenticating Agent, shall give written notice of such appointment to the
Depositor and shall mail notice of such appointment to all Holders of
Certificates. Any successor Authenticating Agent upon acceptance of its
appointment hereunder shall become vested with all the rights, powers, duties
and responsibilities of its predecessor hereunder, with like effect as if
originally named as Authenticating Agent. No successor Authenticating Agent
shall be appointed unless eligible under the provisions of this Section 6.10.
No Authenticating Agent shall have responsibility or liability for any action
taken by it as such at the direction of the Trustee. Any Authenticating
Agent shall be entitled to reasonable compensation for its services and, if
paid by the Trustee, it shall be a reimbursable expense pursuant to Section
6.12.
Section 6.11. Indemnification of Trustee. The Trustee and its
--------------------------
directors, officers, employees and agents shall be entitled to
indemnification from the Trust Fund, to the extent that indemnification is
not provided by the Servicer pursuant to the Sale and Servicing Agreement,
for any loss, liability or expense incurred in connection with any legal
proceeding and incurred without negligence or willful misconduct on their
part, arising out of, or in connection with, the acceptance or administration
of the trusts created hereunder, including the costs and expenses of
defending themselves against any claim in connection with the exercise or
performance of any of their powers or duties hereunder, provided that:
(i) to the extent that the indemnification provisions of the Sale
and Servicing Agreement indemnify the Trustee, as assignee of the
"Purchaser" thereunder, for such loss, liability or expense, the Trustee
has first made reasonable efforts to enforce any applicable provisions
in the Sale and Servicing Agreement for indemnification or reimbursement
of the Trustee (as "Purchaser") by the Servicer (it being understood and
agreed that "reasonable efforts" shall, without limitation, (A) not
require that the Trustee have brought suit against the Servicer to
enforce such indemnification provisions before making a claim against
the assets of the Trust Fund and (B) have been satisfied if the Trustee
shall have made demand on the Servicer for such indemnification, but the
Servicer is unable to satisfy such demand due to its insolvency);
(ii) with respect to any such claim, the Trustee shall have given
the Depositor and the Holders written notice thereof promptly after the
Trustee shall have knowledge thereof;
(iii) while maintaining control over its own defense, the Trustee
shall cooperate and consult fully with the Depositor in preparing such
defense; and
(iv) notwithstanding anything to the contrary in this Section 6.11,
the Trust Fund shall not be liable for settlement of any such claim by
the Trustee entered into without the prior consent of the Depositor,
which consent shall not be unreasonably withheld.
The provisions of this Section 6.11 shall survive any termination of
this Agreement and the resignation or removal of the Trustee and shall be
construed to include, but not be limited to any loss, liability or expense
under any environmental law.
Section 6.12. Fees and Expenses of Trustee. The Trustee shall be
----------------------------
entitled to receive, and is authorized to pay to itself, on a monthly basis,
the Trustee Fee and, as additional compensation, the amount of income or gain
earned from the investment of funds in the Certificate Account. The Trustee
shall be entitled to reimbursement of reasonable disbursements and expenses
made or incurred by the Trustee in accordance with the provisions of this
Agreement, but not for (i) any such expense, disbursement or advance as may
arise from the Trustee's negligence or willful misconduct or (ii) any amount
expressly required under this Agreement to be paid by the Trustee from its
own funds.
Section 6.13. Collection of Monies. Except as otherwise expressly
--------------------
provided in this Agreement, the Trustee may demand payment or delivery of,
and shall receive and collect, all money and other property payable to or
receivable by the Trustee pursuant to this Agreement. The Trustee shall hold
all such money and property received by it as part of the Trust Fund and
shall distribute it as provided in this Agreement. If the Trustee shall not
have timely received amounts to be remitted with respect to the Mortgage
Loans from the Servicer, the Trustee shall request the Servicer to make such
distribution as promptly as practicable or legally permitted. If the Trustee
shall subsequently receive any such amount, it may withdraw such request.
Section 6.14. Trustee To Act; Appointment of Successor. (a) If an
----------------------------------------
Event of Default shall occur, then, in each and every case, subject to
applicable law, so long as any such Event of Default shall not have been
remedied within any period of time prescribed by the Sale and Servicing
Agreement, the Trustee by notice in writing to the Servicer may, and shall,
if so directed by Certificateholders evidencing more than 50% of the Class
Certificate Principal Amount (or Aggregate Notional Amount) of each Class of
Certificates, terminate all of the rights and obligations of the Servicer
under the Sale and Servicing Agreement and in and to the Mortgage Loans and
the proceeds thereof. On or after the receipt by the Servicer of such
written notice, all authority and power of the Servicer, and only in its
capacity as Servicer under the Sale and Servicing Agreement, whether with
respect to the Mortgage Loans or otherwise, shall pass to and be vested in
the Trustee pursuant to and under the terms of the Sale and Servicing
Agreement; and the Trustee is hereby authorized and empowered to execute and
deliver, on behalf of the defaulting Servicer as attorney-in-fact or
otherwise, any and all documents and other instruments, and to do or
accomplish all other acts or things necessary or appropriate to effect the
purposes of such notice of termination, whether to complete the transfer and
endorsement or assignment of the Mortgage Loans and related documents or
otherwise.
If any Event of Default shall occur, the Trustee shall promptly notify
the Rating Agencies of the nature and extent of such Event of Default. The
Trustee shall immediately give written notice to the Servicer upon such
Servicer's failure to remit funds on the Remittance Date.
(b) On and after the time the Servicer receives a notice of termination
from the Trustee pursuant to Section 6.14(a) or the Trustee receives the
resignation of the Servicer evidenced by an Opinion of Counsel pursuant to
the applicable provision of the Sale and Servicing Agreement, the Trustee,
unless another servicer shall have been appointed, shall be the successor in
all respects to the Servicer in its capacity as such under this Agreement and
the transactions set forth or provided for herein and shall have all the
rights and powers and be subject to all the responsibilities, duties and
liabilities relating thereto and arising thereafter placed on the Servicer
under the Sale and Servicing Agreement, including the obligation to make
Advances; provided, however, that any failure to perform such duties or
responsibilities caused by the Servicer's failure to provide information
required by the Sale and Servicing Agreement shall not be considered a
default by the Trustee hereunder. In addition, the Trustee shall have no
responsibility for any act or omission of the Servicer prior to the issuance
of any notice of termination. In the Trustee's capacity as such successor,
the Trustee shall have the same limitations on liability herein granted to
the Servicer. As compensation therefor, the Trustee shall be entitled to
receive all compensation payable to the Servicer under the Sale and Servicing
Agreement, including the applicable portion of the related Servicing Fee.
(c) Notwithstanding the above, the Trustee may, if it shall be
unwilling to continue to so act, or shall, if it is unable to so act,
appoint, or petition a court of competent jurisdiction to appoint, any
established housing and home finance institution servicer, master servicer,
servicer or mortgage servicing institution having a net worth of not less
than $15,000,000 and meeting such other standards for a successor servicer as
are set forth in the Sale and Servicing Agreement, as the successor to such
Servicer in the assumption of all of the responsibilities, duties or
liabilities of a servicer, like the Servicer. Any entity designated by the
Trustee as a successor Servicer may be an Affiliate of the Trustee; provided,
however, that, unless such Affiliate
-------- -------
meets the net worth requirements and other standards set forth herein for a
successor servicer, the Trustee, in its individual capacity shall agree, at
the time of such designation, to be and remain liable to the Trust Fund for
such Affiliate's actions and omissions in performing its duties hereunder.
In connection with such appointment and assumption, the Trustee may make such
arrangements for the compensation of such successor out of payments on
Mortgage Loans as it and such successor shall agree; provided, however, that
no such compensation shall be in excess of that
-------- -------
permitted to the Servicer. The Trustee and such successor shall take such
actions, consistent with this Agreement, as shall be necessary to effectuate
any such succession and may make other arrangements with respect to the
servicing to be conducted hereunder which are not inconsistent herewith. The
Servicer shall cooperate with the Trustee and any successor servicer in
effecting the termination of the Servicer's responsibilities and rights
hereunder including, without limitation, notifying Mortgagors of the
assignment of the servicing functions and providing the Trustee and successor
servicer, as applicable, all documents and records in electronic or other
form reasonably requested by it to enable it to assume the Servicer's
functions hereunder and the transfer to the Trustee or such successor
servicer, as applicable, all amounts which shall at the time be or should
have been deposited by the Servicer in the Certificate Account and any other
account or fund maintained with respect to the Certificates or thereafter be
received with respect to the Mortgage Loans. Neither the Trustee nor any
other successor servicer shall be deemed to be in default hereunder by reason
of any failure to make, or any delay in making, any distribution hereunder or
any portion thereof caused by (i) the failure of the Servicer to deliver, or
any delay in delivering, cash, documents or records to it, (ii) to cooperate
as required by the Sale and Servicing Agreement, (iii) to deliver the
Mortgage Loan data to the Trustee as required by the Sale and Servicing
Agreement or (iv) restrictions imposed by any regulatory authority having
jurisdiction over the Servicer.
Section 6.15. Additional Remedies of Trustee Upon Event of Default.
----------------------------------------------------
During the continuance of any Event of Default, so long as such Event of
Default shall not have been remedied, the Trustee, in addition to the rights
specified in Section 6.14, shall have the right, in its own name and as
trustee of an express trust, to take all actions now or hereafter existing at
law, in equity or by statute to enforce its rights and remedies and to
protect the interests, and enforce the rights and remedies, of the
Certificateholders (including the institution and prosecution of all
judicial, administrative and other proceedings and the filings of proofs of
claim and debt in connection therewith). Except as otherwise expressly
provided in this Agreement, no remedy provided for by this Agreement shall be
exclusive of any other remedy, and each and every remedy shall be cumulative
and in addition to any other remedy, and no delay or omission to exercise any
right or remedy shall impair any such right or remedy or shall be deemed to
be a waiver of any Event of Default.
Section 6.16. Waiver of Defaults. 35% or more of the Aggregate
------------------
Voting Interests of Certificateholders may waive any default or Event of
Default by the Servicer in the performance of its obligations under the Sale
and Servicing Agreement except that a default in the making of any required
deposit to the Certificate Account that would result in a failure of the
Trustee to make any required payment of principal of or interest on the
Certificates may only be waived with the consent of 100% of the affected
Certificateholders. Upon any such waiver of a past default, such default
shall cease to exist, any Event of Default arising therefrom shall be deemed
to have been remedied for every purpose of this Agreement, and, to the extent
that such default related to the Servicer's obligation to make any Advance,
the Trustee shall not be obligated to make such Advance, notwithstanding
anything to the contrary in this Agreement. No such waiver shall extend to
any subsequent or other default or impair any right consequent thereon except
to the extent expressly so waived.
Section 6.17. Notification to Holders. Upon termination of the
-----------------------
Servicer or appointment of a successor Servicer, in each case as provided
herein, the Trustee shall promptly mail notice thereof by first class mail to
the Certificateholders at their respective addresses appearing on the
Certificate Register. The Trustee shall also, within 45 days after the
occurrence of any Event of Default known to the Trustee, give written notice
thereof to Certificateholders, unless such Event of Default shall have been
cured or waived prior to the issuance of such notice and within such 45-day
period.
Section 6.18. Directions by Certificateholders and Duties of Trustee
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During Event of Default. Subject to the provisions of Section 8.01
-----------------------
hereof, during the continuance of any Event of Default, Holders of
Certificates evidencing not less than 25% of the Class Certificate Principal
Amount (or Aggregate Notional Amount) of each Class of Certificates may
direct the time, method and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or power conferred upon the
Trustee, under this Agreement; provided,
--------
however, that the Trustee shall be under no obligation to pursue any such
-------
remedy, or to exercise any of the trusts or powers vested in it by this
Agreement (including, without limitation, (i) the conducting or defending of
any administrative action or litigation hereunder or in relation hereto and
(ii) the terminating of the Servicer or any successor servicer from its
rights and duties as servicer hereunder) at the request, order or direction
of any of the Certificateholders, unless such Certificateholders shall have
offered to the Trustee reasonable security or indemnity against the cost,
expenses and liabilities which may be incurred therein or thereby; and,
provided further, that, subject to the provisions of Section
-------- -------
8.01, the Trustee shall have the right to decline to follow any such
direction if the Trustee, in accordance with an Opinion of Counsel,
determines that the action or proceeding so directed may not lawfully be
taken or if the Trustee in good faith determines that the action or
proceeding so directed would involve it in personal liability or be unjustly
prejudicial to the non-assenting Certificateholders.
Section 6.19. Action Upon Certain Failures of the Servicer and Upon
-----------------------------------------------------
Event of Default. In the event that the Trustee shall have actual
----------------
knowledge of any action or inaction of the Servicer, which would become an
Event of Default upon the Servicer's failure to remedy the same after notice,
the Trustee shall give notice thereof to the Servicer. For all purposes of
this Agreement, in the absence of actual knowledge by a Responsible Officer
of the Trustee, the Trustee shall not be deemed to have knowledge of any
failure of the Servicer or any other Event of Default unless notified thereof
in writing by the Servicer or by a Certificateholder.
ARTICLE VII
PURCHASE AND TERMINATION
OF THE TRUST FUND
Section 7.01. Termination of Trust Fund Upon Repurchase or
--------------------------------------------
Liquidation of All Mortgage Loans. (a) The obligations and
---------------------------------
responsibilities of the Trustee created hereby (other than the obligation of
the Trustee to make payments to Certificateholders as set forth in Section
7.02), shall terminate on the earlier of (i) the final payment or other
liquidation of the last Mortgage Loan remaining in the Trust Fund and the
disposition of all REO Property and (ii) the sale of the property held by the
Trust Fund in accordance with Section 7.01(b); provided,
--------
however, that in no event shall the Trust Fund created hereby continue
-------
beyond the earlier of (i) the expiration of 21 years from the death of the
last survivor of the descendants of Xxxxxx X. Xxxxxxx, the late Ambassador of
the United States to the Court of St. James's, living on the date hereof, and
(ii) the Latest Possible Maturity Date. Any termination of the Trust Fund
shall be carried out in such a manner so that the termination of each REMIC
included therein shall qualify as a "qualified liquidation" under the REMIC
Provisions.
(b) On any Distribution Date occurring after the date on which the
aggregate Scheduled Principal Balance of the Mortgage Loans is less than 5%
of the Cut-off Date Aggregate Principal Balance, the Depositor may cause the
Trust Fund to adopt a plan of complete liquidation pursuant to Section
7.03(a)(i) hereof to sell all of its property. The property of the Trust
Fund shall be sold at a price (the "Termination Price") equal
-----------------
to: (i) 100% of the unpaid principal balance of each Mortgage Loan on the day
of such purchase plus interest accrued thereon at the applicable Mortgage
Rate with respect to any Mortgage Loan to the Due Date in the Due Period
immediately preceding the related Distribution Date to the date of such
repurchase and (ii) the fair market value of any REO Property and any other
property held by any REMIC, such fair market value to be determined by an
appraiser or appraisers mutually agreed upon by the Servicer and the Trustee.
Section 7.02. Procedure Upon Termination of Trust Fund. (a) Notice
----------------------------------------
of any termination pursuant to the provisions of Section 7.01, specifying the
Distribution Date upon which the final distribution shall be made, shall be
given promptly by the Trustee by first class mail to Certificateholders
mailed no later than the later of five Business Days after the Trustee has
received notice from the Depositor of its intent to exercise its right to
cause the termination of the Trust Fund pursuant to Section 7.01(b) or the
final payment or other liquidation of the last Mortgage Loan or REO Property
in the Trust Fund. Such notice shall specify (A) the Distribution Date upon
which final distribution on the Certificates will be made upon presentation
and surrender of the Certificates at the Corporate Trust Office, and (B) that
the Record Date otherwise applicable to such Distribution Date is not
applicable, distribution being made only upon presentation and surrender of
the Certificates at the office or agency of the Trustee therein specified.
The Trustee shall give such notice to the Certificate Registrar at the time
such notice is given to Holders of the Certificates. Upon any such
termination, the duties of the Certificate Registrar with respect to the
Certificates shall terminate and the Trustee shall terminate the Collection
Account it maintains, the Certificate Account and any other account or fund
maintained with respect to the Certificates, subject to the Trustee's
obligation hereunder to hold all amounts payable to Certificateholders in
trust without interest pending such payment.
(b) In the event that all of the Holders do not surrender their
Certificates for cancellation within three months after the time specified in
the above-mentioned written notice, the Trustee shall give a second written
notice to the remaining Certificateholders to surrender their Certificates
for cancellation and receive the final distribution with respect thereto. If
within one year after the second notice any Certificates shall not have been
surrendered for cancellation, the Trustee may take appropriate steps to
contact the remaining Certificateholders concerning surrender of such
Certificates, and the cost thereof shall be paid out of the amounts
distributable to such Holders. If within two years after the second notice
any Certificates shall not have been surrendered for cancellation, the
Trustee shall, subject to applicable state law relating to escheatment, hold
all amounts distributable to such Holders for the benefit of such Holders.
No interest shall accrue on any amount held by the Trustee and not
distributed to a Certificateholder due to such Mortgage Certificateholder's
failure to surrender its Certificate(s) for payment of the final distribution
thereon in accordance with this Section.
Section 7.03. Additional Trust Fund Termination Requirements. (a)
----------------------------------------------
The Trust Fund shall be terminated in accordance with the following
additional requirements, unless the Trustee seeks, and subsequently receives,
an Opinion of Counsel, addressed to the Trustee to the effect that the
failure of the Trust Fund to comply with the requirements of this Section
7.03 will not (i) result in the imposition of taxes on any REMIC under the
REMIC Provisions or (ii) cause any REMIC established hereunder to fail to
qualify as a REMIC at any time that any Certificates are outstanding:
(i) Within 89 days prior to the time of the making of the
final payment on the Certificates, the Trustee (upon notification by the
Depositor that it intends to exercise its option to cause the termina-
tion of the Trust Fund) shall adopt a plan of complete liquidation of
the Trust Fund on behalf of each REMIC, meeting the requirements of a
qualified liquidation under the REMIC Provisions;
(ii) The sale of the assets of the Trust Fund pursuant to
Section 7.02 shall be a sale for cash and shall occur at or after the
time of adoption of such a plan of complete liquidation and prior to the
time of making of the final payment on the Certificates;
(iii) On the date specified for final payment of the
Certificates, the Trustee shall make final distributions of principal
and interest on the Certificates in accordance with Section 5.02 and,
after payment of, or provision for any outstanding expenses, distribute
or credit, or cause to be distributed or credited, to the Holders of the
Residual Certificates all cash on hand after such final payment (other
than cash retained to meet claims), and the Trust Fund (and each REMIC)
shall terminate at that time; and
(iv) In no event may the final payment on the Certificates or
the final distribution or credit to the Holders of the Residual
Certificates be made after the 89th day from the date on which the plan
of complete liquidation is adopted.
(b) By its acceptance of a Residual Certificate, each Holder
thereof hereby (i) authorizes the Trustee to take such action as may be
necessary to adopt a plan of complete liquidation of the related REMIC and
(ii) agrees to take such other action as may be necessary to adopt a plan of
complete liquidation of the related REMIC, which authorization shall be
binding upon all successor Residual Certificateholders.
ARTICLE VIII
RIGHTS OF CERTIFICATEHOLDERS
Section 8.01. Limitation on Rights of Holders. (a) The death or
-------------------------------
incapacity of any Certificateholder shall not operate to terminate this
Agreement or this Trust Fund, nor entitle such Certificateholder's legal
representatives or heirs to claim an accounting or take any action or
proceeding in any court for a partition or winding up of this Trust Fund, nor
otherwise affect the rights, obligations and liabilities of the parties
hereto or any of them. Except as otherwise expressly provided herein, no
Certificateholder, solely by virtue of its status as a Certificateholder,
shall have any right to vote or in any manner otherwise control the operation
and management of the Trust Fund, or the obligations of the parties hereto,
nor shall anything herein set forth, or contained in the terms of the
Certificates, be construed so as to 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.
(b) No Certificateholder, solely by virtue of its status as
Certificateholder, shall have any right by virtue or by availing of any
provision of this Agreement to institute any suit, action or proceeding in
equity or at law upon or under or with respect to this Agreement, unless such
Holder previously shall have given to the Trustee a written notice of an
Event of Default and of the continuance thereof, as hereinbefore provided,
and unless also the Holders of Certificates evidencing not less than 25% of
the Class Certificate Principal Amount (or Aggregate Notional Amount) of
Certificates of each Class 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 cost, expenses and liabilities to be incurred
therein or thereby, and the Trustee, for sixty 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 and no direction inconsistent
with such written request has been given such Trustee during such sixty-day
period by such Certificateholders; it being understood and intended, and
being expressly covenanted by each Certificateholder with every other
Certificateholder and the Trustee, that no one or more Holders of
Certificates shall have any right in any manner whatever by virtue or by
availing of any provision of this Agreement to affect, disturb or prejudice
the rights of the Holders of any other of such Certificates, or to obtain or
seek to obtain priority over or preference to any other such Holder, or to
enforce any right under this Agreement, except in the manner herein provided
and for the benefit of all Certificateholders. For the protection and
enforcement of the provisions of this Section, each and every
Certificateholder and the Trustee shall be entitled to such relief as can be
given either at law or in equity.
Section 8.02. Access to List of Holders. (a) If the Trustee is not
-------------------------
acting as Certificate Registrar, the Certificate Registrar will furnish or
cause to be furnished to the Trustee, within fifteen days after receipt by
the Certificate Registrar of a request by the Trustee in writing, a list, in
such form as the Trustee may reasonably require, of the names and addresses
of the Certificateholders of each Class as of the most recent Record Date.
(b) If three or more Holders or Certificate Owners (hereinafter
referred to as "Applicants") apply in writing to the Trustee, and such
application states that the Applicants desire to communicate with other
Holders with respect to their rights under this Agreement or under the
Certificates and is accompanied by a copy of the communication which such
Applicants propose to transmit, then the Trustee shall, within five Business
Days after the receipt of such application, afford such Applicants reasonable
access during the normal business hours of the Trustee to the most recent
list of Certificateholders held by the Trustee or shall, as an alternative,
send, at the Applicants' expense, the written communication proffered by the
Applicants to all Certificateholders at their addresses as they appear in the
Certificate Register.
(c) Every Holder or Certificate Owner, if the Holder is a Clearing
Agency, by receiving and holding a Certificate, agrees with the Depositor,
the Certificate Registrar and the Trustee that neither the Depositor, the
Certificate Registrar nor the Trustee shall be held accountable by reason of
the disclosure of any such information as to the names and addresses of the
Certificateholders hereunder, regardless of the source from which such
information was derived.
Section 8.03. Acts of Holders of Certificates. (a) Any request,
-------------------------------
demand, authorization, direction, notice, consent, waiver or other action
provided by this Agreement to be given or taken by Holders or Certificate
Owner, if the Holder is a Clearing Agency, may be embodied in and evidenced
by one or more instruments of substantially similar tenor signed by such
Holders in person or by agent duly appointed in writing; and, except as
herein otherwise expressly provided, such action shall become effective when
such instrument or instruments are delivered to the Trustee. Such instrument
or instruments (as the action embodies therein and evidenced thereby) are
herein sometimes referred to as an "Act" of the Holders signing such
instrument or instruments. Proof of execution of any such instrument or of a
writing appointing any such agents shall be sufficient for any purpose of
this Agreement and conclusive in favor of the Trustee, if made in the manner
provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by the certificate of any notary public or other officer
authorized by law to take acknowledgments or deeds, certifying that the
individual signing such instrument or writing acknowledged to him the
execution thereof. Whenever such execution is by an officer of a corporation
or a member of a partnership on behalf of such corporation or partnership,
such certificate or affidavit shall also constitute sufficient proof of his
authority. The fact and date of the execution of any such instrument or
writing, or the authority of the individual executing the same, may also be
proved in any other manner which the Trustee deems sufficient.
(c) The ownership of Certificates (whether or not such Certificates
shall be overdue and notwithstanding any notation of ownership or other
writing thereon made by anyone other than the Trustee) shall be proved by the
Certificate Register, and neither the Trustee nor the Depositor shall be
affected by any notice to the contrary.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other action by the Holder of any Certificate shall bind every
future Holder of the same Certificate and the Holder of every Certificate
issued upon the registration of transfer thereof or in exchange therefor or
in lieu thereof, in respect of anything done, omitted or suffered to be done
by the Trustee in reliance thereon, whether or not notation of such action is
made upon such Certificate.
ARTICLE IX
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
Section 9.01. Trustee To Retain Possession of Certain Documents.
-------------------------------------------------
Until all amounts distributable in respect of the Certificates have been
distributed in full, the Trustee (or its custodian) shall retain possession
and custody of each Mortgage File in accordance with and subject to the terms
and conditions of this Agreement; provided, that documents relating to any
Additional Collateral may be held by a custodian on behalf of the Trustee.
Section 9.02. Preparation of Tax Returns and Other Reports. (a)
--------------------------------------------
The Trustee shall prepare or cause to be prepared on behalf of the Trust
Fund, based upon the information furnished by the Servicer or calculated by
the Trustee in accordance with this Agreement pursuant to instructions given
by the Depositor, and shall file federal tax returns and appropriate state
income tax returns and such other returns as may be required by applicable
law relating to the Trust Fund and shall forward copies to the Depositor of
all such returns and Form 1099 information and such other information within
the control of the Trustee as the Depositor may reasonably request in
writing, and shall forward to each Certificateholder such forms and furnish
such information within the control of the Trustee as are required by the
Code and the REMIC Provisions to be furnished to them, and will prepare and
disseminate to Certificateholders Form 1099s (or otherwise furnish
information within the control of the Trustee) to the extent required by
applicable law.
(b) The Trustee shall prepare and file with the Internal Revenue
Service ("IRS"), on behalf of the Trust Fund, an application on IRS Form
SS-4.
(c) The Depositor will prepare or cause to be prepared the initial
current report on Form 8-K and thereafter the Trustee will prepare or cause
to be prepared Forms 10-K and 10-Q (if necessary), or monthly current reports
on Form 8-K, on behalf of the Trust Fund, as may be required by applicable
law or regulation, and will file such reports electronically with the
Securities and Exchange Commission (the "SEC"). The Trustee will sign each
such report on behalf of the Trust Fund, and will forward a copy of each such
report to the Depositor promptly after such report has been filed with the
SEC. The Depositor agrees to use its best efforts to seek to terminate such
filing obligation after the period during which such filings are required
under the Securities Exchange Act of 1934.
Section 9.03. Release of Mortgage Files. (a) Upon becoming aware
-------------------------
of the payment in full of any Mortgage Loan, or upon receipt by the Servicer
of a notification that payment in full has been escrowed in a manner
customary for such purposes for payment to Certificateholders on the next
Distribution Date, the Servicer will immediately notify the Trustee (or its
custodian) by a certification (which certification shall include a statement
to the effect that all amounts received in connection with such payment that
are required to be deposited in the Certificate Account maintained by the
Trustee pursuant to Section 4.04 have been or will be so deposited) of a
Servicing Officer and shall request the Trustee (or its custodian) to deliver
to the Servicer the related Mortgage File. Upon receipt of such
certification and request, the Trustee (or its custodian) shall promptly
release the related Mortgage File to the Servicer and the Trustee shall have
no further responsibility with regard to such Mortgage File. Upon any such
payment in full, the Trustee authorizes the Servicer to give, as agent for
the Trustee, as the mortgagee under the Mortgage that secured the Mortgage
Loan, an instrument of satisfaction (or assignment of mortgage without
recourse) regarding the Mortgaged Property subject to the Mortgage, which
instrument of satisfaction or assignment, as the case may be, shall be
delivered to the Person or Persons entitled thereto against receipt therefor
of such payment, it being understood and agreed that no expenses incurred in
connection with such instrument of satisfaction or assignment, as the case
may be, shall be chargeable to the Certificate Account.
(b) From time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan and in accordance with Accepted Servicing
Practices, the Trustee (or its custodian) shall execute such documents as
shall be prepared and furnished to the Trustee by the Servicer (in form
reasonably acceptable to the Trustee) and as are necessary to the prosecution
of any such proceedings. The Trustee (or its custodian) shall, upon request
of the Servicer and delivery to the Trustee (or its custodian) of a trust
receipt signed by a Servicing Officer substantially in the form of Exhibit C,
release the related Mortgage File held in its possession or control to the
Servicer. Such trust receipt shall obligate the Servicer to return the
Mortgage File to the Trustee (or its custodian) when the need therefor by the
Servicer no longer exists unless the Mortgage Loan shall be liquidated, in
which case, upon receipt of a certificate of a Servicing Officer similar to
that specified above, the trust receipt shall be released by the Trustee (or
its custodian) to the Servicer.
(c) The Trustee covenants and agrees that it will comply with all
relevant laws and regulations governing the custody, processing, release and
delivery of the Mortgage Loan documents within its possession or control.
ARTICLE X
REMIC ADMINISTRATION
Section 10.01. REMIC Administration. (a) An election will be made
--------------------
by the Trustee on behalf of the REMIC to treat the Trust Fund as a REMIC
under the Code. Such election will be made on Form 1066 or other appropriate
federal tax or information return for the taxable year ending on the last day
of the calendar year in which the Certificates are issued. For the purposes
of such election, the Certificates other than the Class R Certificate shall
be designated as the "regular interests" in the REMIC and the Class R
Certificate shall be designated as the "residual interest" in the REMIC.
(b) The Closing Date is hereby designated as the "Startup Day" of each
REMIC within the meaning of section 86OG(a)(9) of the Code.
(c) The Trustee shall pay any and all tax related expenses (not
including taxes) of each REMIC, including but not limited to any professional
fees or expenses related to audits or any administrative or judicial
proceedings with respect to such REMIC that involve the Internal Revenue
Service or state tax authorities, but only to the extent that (i) such
expenses are ordinary or routine expenses, including expenses of a routine
audit but not expenses of litigation (except as described in (ii)); or (ii)
such expenses or liabilities (including taxes and penalties) are attributable
to the negligence or willful misconduct of the Trustee in fulfilling its
duties hereunder (including its duties as tax return preparer).
(d) The Trustee shall act as Tax Matters Person for each REMIC. The
Trustee shall prepare, sign, and file all of each REMIC's federal and state
tax and information returns as such REMIC's direct representative. The
expenses of preparing and filing such returns shall be borne by the Trustee.
(e) The Trustee or its designee shall perform on behalf of each REMIC
all reporting and other tax compliance duties that are the responsibility of
each REMIC under the Code, the REMIC Provisions, or other compliance guidance
issued by the Internal Revenue Service or any state or local taxing
authority. Among its other duties, if required by the Code, the REMIC
Provisions, or other such guidance, the Trustee shall provide (i) to the
Treasury or other governmental authority such information as is necessary for
the application of any tax relating to the transfer of a Residual Certificate
to any disqualified person or organization and (ii) to the Certificateholders
such information or reports as are required by the Code or REMIC Provisions.
(f) The Trustee and the Holders of Certificates shall take any action
or cause each REMIC to take any action necessary to create or maintain the
status of such REMIC as a REMIC under the REMIC Provisions and shall assist
each other as necessary to create or maintain such status. Neither the
Trustee nor the Holder of any Residual Certificate shall take any action,
cause any REMIC to take any action or fail to take (or fail to cause to be
taken) any action that, under the REMIC Provisions, if taken or not taken, as
the case may be, could (i) endanger the status of such REMIC as a REMIC or
(ii) result in the imposition of a tax upon such REMIC (including but not
limited to the tax on prohibited transactions as defined in Code Section
860F(a)(2) and the tax on prohibited contributions set forth on Section
860G(d) of the Code) (either such event, an "Adverse REMIC Event") unless the
Trustee has received an Opinion of Counsel (at the expense of the party
seeking to take such action) to the effect that the contemplated action will
not endanger such status or result in the imposition of such a tax. In
addition, prior to taking any action with respect to a REMIC or the assets
therein, or causing such REMIC to take any action, which is not expressly
permitted under the terms of this Agreement, any Holder of a Residual
Certificate will consult with the Trustee or its designee, in writing, with
respect to whether such action could cause an Adverse REMIC Event to occur
with respect to such REMIC, and no such Person shall take any such action or
cause such REMIC to take any such action as to which the Trustee has advised
it in writing that an Adverse REMIC Event could occur.
(g) Each Holder of a Residual Certificate shall pay when due any and
all taxes imposed on the related REMIC by federal or state governmental
authorities. To the extent that such Trust taxes are not paid by a Residual
Certificateholder, the Trustee shall pay any remaining REMIC taxes out of
current or future amounts otherwise distributable to the Holder of the
Residual Certificate in such REMIC or, if no such amounts are available, out
of other amounts held in the Certificate Account, and shall reduce amounts
otherwise payable to holders of regular interests in such REMIC, as the case
may be.
(h) The Trustee shall, for federal income tax purposes, maintain books
and records with respect to each REMIC on a calendar year and on an accrual
basis.
(i) No additional contributions of assets shall be made to any REMIC,
except as expressly provided in this Agreement with respect to eligible
substitute mortgage loans to the extent permitted by the Sale and Servicing
Agreement.
(j) The Trustee shall not enter into any arrangement by which any REMIC
will receive a fee or other compensation for services.
Section 10.02. Prohibited Transactions and Activities. Neither the
--------------------------------------
Depositor nor the Trustee shall sell, dispose of, or substitute for any of
the Mortgage Loans, except in a disposition pursuant to (i) the foreclosure
of a Mortgage Loan, (ii) the bankruptcy of the Trust Fund, (iii) the
termination of each REMIC pursuant to Article VII of this Agreement, (iv) a
substitution pursuant to Article II of this Agreement or (v) a repurchase of
Mortgage Loans pursuant to Article II of this Agreement, nor acquire any
assets for any REMIC, nor sell or dispose of any investments in the
Certificate Account for gain, nor accept any contributions to any REMIC after
the Closing Date, unless it has received an Opinion of Counsel (at the
expense of the party causing such sale, disposition, or substitution) that
such disposition, acquisition, substitution, or acceptance will not (a)
affect adversely the status of such REMIC as a REMIC or of the Certificates
other than the Residual Certificates as the regular interests therein, (b)
affect the distribution of interest or principal on the Certificates, (c)
result in the encumbrance of the assets transferred or assigned to the Trust
Fund (except pursuant to the provisions of this Agreement) or (d) cause such
REMIC to be subject to a tax on prohibited transactions or prohibited
contributions pursuant to the REMIC Provisions.
The Trustee shall not consent to any modification of any material term
of any Mortgage Loan unless it has received an Opinion of Counsel (at the
expense of the party requesting such modification) to the effect that such
modification would not cause the Trust Fund to fail to qualify as a REMIC or
result in the imposition of any tax under Section 860(F)(a) or Section
860(G)(d) of the Code.
Section 10.03. Indemnification with Respect to Certain Taxes and
-------------------------------------------------
Loss of REMIC Status. In the event that any REMIC fails to qualify as a
--------------------
REMIC, loses its status as a REMIC, or incurs federal, state or local taxes
as a result of a prohibited transaction or prohibited contribution under the
REMIC Provisions due to the negligent performance by the Trustee of its
duties and obligations set forth herein, the Trustee shall indemnify the
Holder of the related Residual Certificate against any and all losses,
claims, damages, liabilities or expenses ("Losses") resulting from such
negligence; provided, however, that the Trustee shall not be
-------- -------
liable for any such Losses attributable to the action or inaction of the
Depositor, or the Holder of such Residual Certificate, as applicable, nor for
any such Losses resulting from misinformation provided by the Holder of such
Residual Certificate on which the Trustee has relied. The foregoing shall
not be deemed to limit or restrict the rights and remedies of the Holder of
such Residual Certificate now or hereafter existing at law or in equity.
Notwithstanding the foregoing, however, in no event shall the Trustee have
any liability (1) for any action or omission that is taken in accordance with
and in compliance with the express terms of, or which is expressly permitted
by the terms of, this Agreement, (2) for any losses other than arising out of
a negligent performance by the Trustee of its duties and obligations set
forth herein, and (3) for any special or consequential damages to
Certificateholders (in addition to payment of principal and interest on the
Certificates).
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01. Binding Nature of Agreement; Assignment. This
---------------------------------------
Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and permitted assigns.
Section 11.02. Entire Agreement. This Agreement contains the entire
----------------
agreement and understanding among the parties hereto with respect to the
subject matter hereof, and supersedes all prior and contemporaneous
agreements, understandings, inducements and conditions, express or implied,
oral or written, of any nature whatsoever with respect to the subject matter
hereof. The express terms hereof control and supersede any course of
performance and/or usage of the trade inconsistent with any of the terms
hereof.
Section 11.03. Amendment. (a) This Agreement may be amended from
---------
time to time by the Depositor and the Trustee, without notice to or the
consent of any of the Holders, (i) to cure any ambiguity, (ii) to cause the
provisions herein to conform to or be consistent with or in furtherance of
the statements made with respect to the Certificates, the Trust Fund or this
Agreement in any Offering Document; or to correct or supplement any provision
herein which may be inconsistent with any other provisions herein, (iii) to
make any other provisions, with respect to matters or questions arising under
this Agreement or (iv) to add, delete, or amend any provisions to the extent
necessary or desirable to comply with any requirements imposed by the Code
and the REMIC Provisions. No such amendment effected pursuant to the
preceding sentence shall, as evidenced by an Opinion of Counsel, adversely
affect the status of any REMIC created pursuant to this Agreement, nor shall
such amendment effected pursuant to clause (iii) of such sentence adversely
affect in any material respect the interests of any Holder. Prior to
entering into any amendment without the consent of Holders pursuant to this
paragraph, the Trustee may require an Opinion of Counsel (at the expense of
the party requesting such amendment) to the effect that such amendment is
permitted under this paragraph. Any such amendment shall be deemed not to
adversely affect in any material respect any Holder, if the Trustee receives
written confirmation from each Rating Agency that such amendment will not
cause such Rating Agency to reduce the then current rating assigned to the
Certificates (and any Opinion of Counsel requested by the Trustee in
connection with any such amendment may rely expressly on such confirmation as
the basis therefor).
(b) This Agreement may also be amended from time to time by the
Depositor and the Trustee with the consent of the Holders of not less than
66-2/3% of the Class Certificate Principal Amount (or Aggregate Notional
Amount) of each Class of Certificates affected thereby 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; provided, however, that no such amendment shall be made unless the
Trustee receives an Opinion of Counsel, at the expense of the party
requesting the change, that such change will not adversely affect the status
of any REMIC as a REMIC or cause a tax to be imposed on such REMIC; and
provided further, that no such amendment may (i) reduce in any manner the
amount of, or delay the timing of, payments received on Mortgage Loans, which
are required to be distributed on any Certificate without the consent of the
Holder of such Certificate or (ii) reduce the aforesaid percentages of Class
Certificate Principal Amount (or Aggregate Notional Amount) of Certificates
of each Class, the Holders of which are required to consent to any such
amendment without the consent of the Holders of 100% of the Class Certificate
Principal Amount (or Aggregate Notional Amount) of each Class of Certificates
affected thereby. For purposes of this paragraph, references to "Holder" or
"Holders" shall be deemed to include, the case of any Class of Book-Entry
Certificates, the related Certificate Owners.
(c) Promptly after the execution of any such amendment, the Trustee
shall furnish written notification of the substance of such amendment to each
Holder, the Depositor and to the Rating Agencies.
(d) It shall not be necessary for the consent of Holders under this
Section 11.03 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 Holders shall be subject to such reasonable
regulations as the Trustee may prescribe.
Section 11.04. Voting Rights. Except to the extent that the consent
-------------
of all affected Certificateholders is required pursuant to this Agreement,
with respect to any provision of this Agreement requiring the consent of
Certificateholders representing specified percentages of aggregate
outstanding Certificate Principal Amount (or Notional Amount), Certificates
owned by the Depositor, the Trustee or the Servicer or Affiliates thereof are
not to be counted so long as such Certificates are owned by the Depositor,
the Trustee or the Servicer or Affiliates thereof.
Section 11.05. Provision of Information. (a) For so long as any of
------------------------
the Certificates of any Series or Class are "restricted securities" within
the meaning of Rule 144(a)(3) under the Act, each of the Depositor and the
Trustee agree to cooperate with each other to provide to any
Certificateholders and to any prospective purchaser of Certificates
designated by such Certificateholder, upon the request of such
Certificateholder or prospective purchaser, any information required to be
provided to such holder or prospective purchaser to satisfy the condition set
forth in Rule 144A(d)(4) under the Act. Any reasonable, out-of-pocket
expenses incurred by the Trustee in providing such information shall be
reimbursed by the Depositor.
(b) The Trustee will provide to any person to whom a Prospectus was
delivered, upon the request of such person specifying the document or
documents requested, (i) a copy (excluding exhibits) of any report on Form 8-
K or Form 10-K filed with the Securities and Exchange Commission pursuant to
Section 9.02(c) and (ii) a copy of any document incorporated by reference in
the Prospectus. Any reasonable out-of-pocket expenses incurred by the
Trustee in providing copies of such documents shall be reimbursed by the
Depositor.
(c) On each Distribution Date the Trustee shall deliver or cause to be
delivered by first class mail to the Depositor, Attention: Contract Finance,
a copy of the report delivered to Certificateholders pursuant to Section
4.03.
Section 11.06. Governing Law. THIS AGREEMENT SHALL BE CONSTRUED IN
-------------
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AND THE OBLIGATIONS,
RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES
APPLIED IN NEW YORK.
Section 11.07. Notices. All demands, notices and communications
-------
hereunder shall be in writing and shall be deemed to have been duly given
when received by (a) in the case of the Depositor, Structured Asset
Securities Corporation, 000 Xxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: Xxxx Xxxx, and (b) in the case of the Trustee, Norwest Bank
Minnesota, N.A., Xxxxx Xxxxxx xxx Xxxxxxxxx Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx,
00000, Attention: Corporate Trust Services (SASCO 1997-1) or as to each
party such other address as may hereafter be furnished by such Party to the
other parties in writing. Any notice required or permitted to be mailed to a
Holder 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
within the time prescribed in this Agreement shall be conclusively presumed
to have been duly given, whether or not the Holder receives such notice.
Section 11.08. Severability of Provisions. If any one or more of
--------------------------
the covenants, agreements, provisions or terms of this Agreement shall be for
any reason whatsoever held invalid, then such covenants, agreements,
provisions or terms shall be deemed severable from the remaining covenants,
agreements, provisions or terms of this Agreement and shall in no way affect
the validity or enforceability of the other provisions of this Agreement or
of the Certificates or the rights of the Holders thereof.
Section 11.09. Indulgences; No Waivers. Neither the failure nor any
-----------------------
delay on the part of a party to exercise any right, remedy, power or
privilege under this Agreement shall operate as a waiver thereof, nor shall
any single or partial exercise of any right, remedy, power or privilege
preclude any other or further exercise of the same or of any other right,
remedy, power or privilege, nor shall any waiver of any right, remedy, power
or privilege with respect to any occurrence be construed as a waiver of such
right, remedy, power or privilege with respect to any other occurrence. No
waiver shall be effective unless it is in writing and is signed by the party
asserted to have granted such waiver.
Section 11.10. Headings Not To Affect Interpretation. The headings
-------------------------------------
contained in this Agreement are for convenience of reference only, and they
shall not be used in the interpretation hereof.
Section 11.11. Benefits of Agreement. (a) Nothing in this
---------------------
Agreement or in the Certificates, express or implied, shall give to any
Person, other than the parties to this Agreement and their successors
hereunder and the Holders of the Certificates, any benefit or any legal or
equitable right, power, remedy or claim under this Agreement, except to the
extent specified in paragraph (b) of this Section 11.11.
(b) Not withstanding any provision herein to the contrary, the
parties to this Agreement agree that it is appropriate, in furtherance of the
intent of such parties as set forth herein, that the Servicer receive the
benefit of the provisions of Section 9.03 hereof and of this Section 11.11 as
an intended third party beneficiary of this Agreement to the extent of such
provisions. The Trustee shall have the same obligations to the Servicer
under Section 9.03 hereof as if the Servicer were a party to this Agreement,
and the Servicer shall have the same rights and remedies to enforce the
provisions of Section 9.03 hereof and this Section 11.11 as if the Servicer
were a party to this Agreement.
Section 11.12. Special Notices to the Rating Agencies. (a) The
--------------------------------------
Depositor shall give, prompt notice to the Rating Agencies of the occurrence
of any of the following events of which it has notice:
(i) any amendment to this Agreement pursuant to Section
11.03;
(ii) the appointment of any successor to the Servicer
pursuant to Section 6.14; and
(iii) the making of a final payment pursuant to Section
7.02.
(b) All notices to the Rating Agencies provided for this Section
shall be in writing and sent by first class mail, telecopy or overnight
courier, as follows:
If to Fitch, to:
Fitch Investors Service, L.P.
0000 Xxxx 0xx Xxxxxx
Xxxxxx, Xxxxxxx 00000
Attention: Residential Mortgage Surveillance
If to S&P, to:
Standard & Poor's Ratings Services,
A division of The XxXxxx-Xxxx Companies, Inc.
00 Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Residential Mortgages
(c) The Trustee shall deliver to the Rating Agencies reports
prepared pursuant to Section 4.03.
Section 11.13. Counterparts. This Agreement may be executed in one
------------
or more counterparts, each of which shall be deemed to be an original, and
all of which together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the Depositor and the Trustee have caused their
names to be signed hereto by their respective officers hereunto duly
authorized as of the day and year first above written.
STRUCTURED ASSET SECURITIES
CORPORATION, as Depositor
By: /s/ Xxxx XxXxxxx
-----------------------------
Name: Xxxx XxXxxxx
Title: Senior Vice President
NORWEST BANK MINNESOTA, N.A.,
as Trustee
By: /s/ Xxxxx Xxxxxxxxx
-----------------------------
Name: Xxxxx Xxxxxxxxx
Title: Vice President
For Purposes of Section 9.03 and 11.11,
accepted and agreed to by:
BOSTON SAFE DEPOSIT AND TRUST COMPANY
By: /s/ Xxxxx X. Xxxxxx
-----------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President
EXHIBIT A
---------
FORMS OF CERTIFICATES
Exhibit B-1
-----------
FORM OF FINAL CERTIFICATION
----------------------
(Date)
Structured Asset Securities Corporation
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Trust Agreement (the "Trust Agreement"), dated as of January 1,
1997 between Structured Asset Securities Corporation, as Depositor
and Norwest Bank Minnesota, N.A., as Trustee, with respect to
Structured Asset Securities Corporation Mortgage Pass-Through
Certificates, Series 1997-1
Ladies and Gentlemen:
In accordance with Section 2.02(b) of the Trust Agreement, the
undersigned hereby certifies that as to each Mortgage Loan listed in the
Mortgage Loan Schedule (other than any Mortgage Loan paid in full or listed
on the attachment hereto) it (or its custodian) has received:
(i) the original Mortgage Note endorsed without recourse in proper
form to the order of the Trustee;
(ii) a duly executed Assignment of Mortgage or assignment of
security agreement;
(iii) with respect to any Mortgage Loan other than a Cooperative
Mortgage Loan, the original recorded Mortgage, and with respect to any
Cooperative Mortgage Loan, the original recorded pledge and security
agreement, with evidence of recording indicated thereon; or, if, in
connection with any Mortgage Loan, the Depositor (or the Servicer or any of
its correspondents, at the direction of the Seller and the Depositor) cannot
deliver the Mortgage or pledge and security agreement with evidence of
recording thereon because such document has been lost, the Depositor (or the
Servicer or its correspondents, at the direction of the Seller and Depositor)
shall deliver or cause to be delivered to the Trustee, a photocopy of such
document (certified by the Servicer or its correspondents to be a true and
correct copy) together with a written Opinion of Counsel acceptable to the
Trustee and the Depositor that an original recorded Mortgage or pledge and
security agreement is not required to enforce the Trustee's interest in the
Mortgage Loan;
(iv) if applicable, such original intervening assignments
("Intervening Assignments"), as may be necessary to
show a complete chain of title to the Mortgage from the originator to the
Trustee at the direction of the Seller and the Depositor; or, as to any such
Intervening Assignment which cannot be delivered because such Intervening
Assignment has been lost, a photocopy of such Intervening Assignment and a
certificate of the Servicer as specified in Exhibit C-1 of the Sale and
Servicing Agreement.
(v) with respect to any Mortgage Loan other than a Cooperative
Loan, the original lender's Title Insurance Policy or a written commitment to
issue such Title Insurance Policy or, in lieu thereof, a copy of such Title
Insurance Policy;
(vi) the original of each assumption, modification or substitution
agreement, if any, relating to the Mortgage Loans (as and to the extent of
those Mortgage Loans specifically identified by the Servicer to be subject to
any assumption, modification or substitution;
(vii) with respect to any Cooperative Mortgage Loan, the original
Cooperative Loan Documents; and
(viii) the original additional collateral pledge and security
agreement executed in connection with each pledge of Additional Collateral,
assigned to the Trustee.
The undersigned hereby certifies that as to each Mortgage Loan
identified on the Mortgage Loan Schedule, other than any Mortgage Loan listed
on the attachment hereto, it has reviewed the documents listed above and has
determined that each such document appears to be complete and, based on an
examination of such documents, the information set forth in the Mortgage Loan
Schedule is correct.
Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the Trust Agreement. This Certificate is
qualified in all respects by the terms of said Trust Agreement.
(Custodian)
(NORWEST BANK MINNESOTA, N.A.,
as Trustee)
By:________________________________
Name:
Title:
Exhibit B-2
-----------
FORM OF ENDORSEMENT
Pay to the order of Norwest Bank Minnesota, N.A., as trustee (the
"Trustee") under a Trust Agreement dated as of January 1, 1997, between
Structured Asset Securities Corporation, as Depositor, and the Trustee
relating to Structured Asset Securities Corporation Mortgage Pass-Through
Certificates, Series 1997-1, without recourse.
__________________________________
(current signatory on note)
By:_______________________________
Name:
Title:
EXHIBIT C
---------
REQUEST FOR RELEASE OF DOCUMENTS AND RECEIPT
----------------------
(Date)
(Addressed to Trustee
or, if applicable, custodian)
In connection with the administration of the mortgages held by you as
Trustee under a certain Trust Agreement dated as of 1, 199__
-------------
between Structured Asset Securities Corporation, as Depositor, and you, as
Trustee (the "Trust Agreement"), the undersigned Servicer hereby requests a
release of the Mortgage File held by you as Trustee with respect to the
following described Mortgage Loan for the reason indicated below.
Mortgagor's Name:
Address:
Loan No.:
Reason for requesting file:
1. Mortgage Loan paid in full. (The Servicer hereby certifies that all
amounts received in connection with the loan have been or will be credited to
the Collection Account or the Certificate Account (whichever is applicable)
pursuant to the Trust Agreement.)
2. Mortgage Loan repurchased. (The Servicer hereby certifies that the
Purchase Price has been credited to the Collection Account or the Certificate
Account (whichever is applicable) pursuant to the Trust Agreement.)
3. Mortgage Loan substituted. (The Servicer hereby certifies that a
Qualifying Substitute Mortgage Loan has been assigned and delivered to you
along with the related Mortgage File pursuant to the Trust Agreement.)
4. The Mortgage Loan is being foreclosed.
5. Other. (Describe)
The undersigned acknowledges that the above Mortgage File will be held
by the undersigned in accordance with the provisions of the Trust Agreement
and will be returned to you within ten (10) days of our receipt of the
Mortgage File, except if the Mortgage Loan has been paid in full, or
repurchased or substituted for a Qualifying Substitute Mortgage Loan (in
which case the Mortgage File will be retained by us permanently) and except
if the Mortgage Loan is being foreclosed (in which case the Mortgage File
will be returned when no longer required by us for such purpose).
Capitalized terms used herein shall have the meanings ascribed to them
in the Trust Agreement.
__________________________________
(Name of Servicer)
By:_______________________________
Name:
Title: Servicing Officer
EXHIBIT D-1
-----------
FORM OF RESIDUAL CERTIFICATE TRANSFER AFFIDAVIT (TRANSFEREE)
STATE OF )
) ss.:
COUNTY OF )
(NAME OF OFFICER), _________________ being first duly sworn,
deposes and says:
1. That he (she) is (title of officer) ___________
_____________ of (name of Purchaser) ________________________
_________________ (the "Purchaser"), a _______________________ (description
of type of entity) duly organized and existing under the laws of the (State
of __________) (United States), on behalf of which he (she) makes this
affidavit.
2. That the Purchaser's Taxpayer Identification Number is
( ).
3. That the Purchaser is not a "disqualified organization" within
the meaning of Section 860E(e)(5) of the Internal Revenue Code of 1986, as
amended (the "Code") and will not be a "disqualified organization" as of
(date of transfer), and that the Purchaser is not acquiring a Residual
Certificate (as defined in the Agreement) for the account of, or as agent
(including a broker, nominee, or other middleman) for, any person or entity
from which it has not received an affidavit substantially in the form of this
affidavit. For these purposes, a "disqualified organization" means the
United States, any state or political subdivision thereof, any foreign
government, any international organization, any agency or instrumentality of
any of the foregoing (other than an instrumentality if all of its activities
are subject to tax and a majority of its board of directors is not selected
by such governmental entity), any cooperative organization furnishing
electric energy or providing telephone service to persons in rural areas as
described in Code Section 1381(a)(2)(C), or any organization (other than a
farmers' cooperative described in Code Section 521) that is exempt from
federal income tax unless such organization is subject to the tax on
unrelated business income imposed by Code Section 511.
4. That the Purchaser is not, and on __________ (insert date of
transfer of Residual Certificate to Purchaser) will not be, and is not and on
such date will not be investing the assets of, an employee benefit plan
subject to the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), or a plan subject to Code Section 4975 or a person or entity that
is using the assets of any employee benefit plan or other plan to acquire a
Residual Certificate.
5. That the Purchaser hereby acknowledges that under the terms of
the Trust Agreement (the "Agreement") between Structured Asset Securities
Corporation and Norwest Bank Minnesota, N.A., as Trustee, dated as of January
1, 1997, no transfer of the Residual Certificates shall be permitted to be
made to any person unless the Trustee has received a certificate from such
transferee to the effect that such transferee is not an employee benefit plan
subject to ERISA or a plan subject to Section 4975 of the Code and is not
using the assets of any employee benefit plan or other plan to acquire
Residual Certificates.
6. That the Purchaser does not hold REMIC residual securities as
nominee to facilitate the clearance and settlement of such securities through
electronic book-entry changes in accounts of participating organizations
(such entity, a "Book-Entry Nominee").
7. That the Purchaser does not have the intention to impede the
assessment or collection of any federal, state or local taxes legally
required to be paid with respect to such Residual Certificate.
8. That the Purchaser will not transfer a Residual Certificate to
any person or entity (i) as to which the Purchaser has actual knowledge that
the requirements set forth in paragraph 3, paragraph 6 or paragraph 10 hereof
are not satisfied or that the Purchaser has reason to believe does not
satisfy the requirements set forth in paragraph 7 hereof, and (ii) without
obtaining from the prospective Purchaser an affidavit substantially in this
form and providing to the Trustee a written statement substantially in the
form of Exhibit G to the Agreement.
9. That the Purchaser understands that, as the holder of a
Residual Certificate, the Purchaser may incur tax liabilities in excess of
any cash flows generated by the interest and that it intends to pay taxes
associated with holding such Residual Certificate as they become due.
10. That the Purchaser (i) is not a Non-U.S. Person or (ii) is a
Non-U.S. Person that holds a Residual Certificate in connection with the
conduct of a trade or business within the United States and has furnished the
transferor and the Trustee with an effective Internal Revenue Service Form
4224 or successor form at the time and in the manner required by the Code or
(iii) is a Non-U.S. Person that has delivered to both the transferor and the
Trustee an opinion of a nationally recognized tax counsel to the effect that
the transfer of such Residual Certificate to it is in accordance with the
requirements of the Code and the regulations promulgated thereunder and that
such transfer of a Residual Certificate will not be disregarded for federal
income tax purposes. "Non-U.S. Person" means an individual, corporation,
partnership or other person other than a citizen or resident of the United
States, a corporation, partnership or other entity created or organized in or
under the laws of the United States or any political subdivision thereof, or
an estate that is subject to U.S. federal income tax regardless of the source
of its income, or a trust if a court within the United States is able to
exercise primary supervision over the administration of the trust and one or
more United States trustees have authority to control all substantial
decisions of the trust.
11. That the Purchaser agrees to such amendments of the Trust
Agreement as may be required to further effectuate the restrictions on
transfer of any Residual Certificate to such a "disqualified organization,"
an agent thereof, a Book-Entry Nominee, or a person that does not satisfy the
requirements of paragraph 7 and paragraph 10 hereof.
12. That the Purchaser consents to the designation of the Trustee
as its agent to act as "tax matters person" of the Trust Fund pursuant to the
Trust Agreement.
IN WITNESS WHEREOF, the Purchaser has caused this instrument to be
executed on its behalf, pursuant to authority of its Board of Directors, by
its (title of officer) this _____ day of __________, 19__.
_________________________________
(name of Purchaser)
By:______________________________
Name:
Title:
Personally appeared before me the above-named (name of officer)
________________, known or proved to me to be the same person who executed
the foregoing instrument and to be the (title of officer) _________________
of the Purchaser, and acknowledged to me that he (she) executed the same as
his (her) free act and deed and the free act and deed of the Purchaser.
Subscribed and sworn before me this _____ day of __________, 19__.
NOTARY PUBLIC
______________________________
COUNTY OF_____________________
STATE OF______________________
My commission expires the _____ day of __________, 19__.
EXHIBIT D-2
-----------
RESIDUAL CERTIFICATE TRANSFER AFFIDAVIT (TRANSFEROR)
___________________
Date
Re: Structured Asset Securities Corporation
Mortgage Pass-Through Certificates
---------------------------------------
_______________________ (the "Transferor") has reviewed the
attached affidavit of _____________________________ (the "Transferee"), and
has no actual knowledge that such affidavit is not true and has no reason to
believe that the information contained in paragraph 7 thereof is not true,
and has no reason to believe that the Transferee has the intention to impede
the assessment or collection of any federal, state or local taxes legally
required to be paid with respect to a Residual Certificate. In addition, the
Transferor has conducted a reasonable investigation at the time of the
transfer and found that the Transferee had historically paid its debts as
they came due and found no significant evidence to indicate that the
Transferee will not continue to pay its debts as they become due.
Very truly yours,
_______________________________
Name:
Title:
EXHIBIT E
---------
Sale and Servicing Agreement
EXHIBIT F
---------
FORM OF RULE 144A TRANSFER CERTIFICATE
Re: Structured Asset Securities Corporation
Mortgage Pass-Through Certificates
Series 1997-1
---------------------------------------
Reference is hereby made to the Trust Agreement dated as of
199 (the "Trust Agreement") between Structured Asset
__________ __, __
Securities Corporation, as Depositor, and Norwest Bank Minnesota, N.A., as
Trustee. Capitalized terms used but not defined herein shall have the
meanings given to them in the Trust Agreement.
This letter relates to $_________ initial Certificate Balance of
Class Certificates which are held in the form of Definitive
-----
Certificates registered in the name of
--------------------------------
(the "Transferor"). The Transferor has requested a transfer of such
Definitive Certificates for Definitive Certificates of such Class registered
in the name of (insert name of transferee).
In connection with such request, and in respect of such
Certificates, the Transferor hereby certifies that such Certificates are
being transferred in accordance with (i) the transfer restrictions set forth
in the Trust Agreement and the Certificates and (ii) Rule 144A under the
Securities Act to a purchaser that the Transferor reasonably believes is a
"qualified institutional buyer" within the meaning of Rule 144A purchasing
for its own account or for the account of a "qualified institutional buyer",
which purchaser is aware that the sale to it is being made in reliance upon
Rule 144A, in a transaction meeting the requirements of Rule 144A and in
accordance with any applicable securities laws of any state of the United
States or any other applicable jurisdiction.
This certificate and the statements contained herein are made for
your benefit and the benefit of the Placement Agent and the Depositor.
_____________________________________
(Name of Transferor)
By:__________________________________
Name:
Title:
Dated: ___________, ____
EXHIBIT G
---------
FORM OF PURCHASER'S LETTER FOR
INSTITUTIONAL ACCREDITED INVESTOR
----------------------
(Date)
Dear Sirs:
In connection with our proposed purchase of $______________ principal
amount of Mortgage Pass-Through Certificates, Series 1997-1 (the "Privately
Offered Certificates") of Structured Asset Securities Corporation (the
"Depositor"), we confirm that:
(1) We have received a copy of the Private Placement Memorandum dated
, 199 relating to the Privately Offered Certificates (the
---------- --
"Private Placement Memorandum"), and we understand that the Privately Offered
Certificates have not been, and will not be, registered under the Securities
Act of 1933, as amended (the "Securities Act"), and may not be sold except as
permitted in the following sentence. We agree, on our own behalf and on
behalf of any accounts for which we are acting as hereinafter stated, that if
we should sell any Privately Offered Certificates within three years of the
later of the date of original issuance of the Privately Offered Certificates
or the last day on which such Privately Offered Certificates are owned by the
Depositor or any affiliate of the Depositor (which includes the Placement
Agent) we will do so only (A) to the Depositor, (B) to "qualified
institutional buyers" (within the meaning of Rule 144A under the Securities
Act) in accordance with Rule 144A under the Securities Act ("QIBs"), (C)
pursuant to an exemption from registration in accordance with Rule 904 of
Regulation S under the Securities Act, (D) pursuant to the exemption from
registration provided by Rule 144 under the Securities Act, or (E) to an
institutional "accredited investor" within the meaning of Rule 501(a)(1),
(2), (3) or (7) of Regulation D under the Securities Act that is not a QIB
(an "Institutional Accredited Investor") which, prior to such transfer,
delivers to the Trustee under the Trust Agreement dated as of
______________ 1, 199_ between the Depositor and Norwest Bank Minnesota,
N.A., as Trustee (the "Trustee"), a signed letter in the form of this letter;
and we further agree, in the capacities stated above, to provide to any
person purchasing any of the Privately Offered Certificates from us a notice
advising such purchaser that resales of the Privately Offered Certificates
are restricted as stated herein.
(2) We understand that, in connection with any proposed resale of any
Privately Offered Certificates to an Institutional Accredited Investor,
we will be required to furnish to the Trustee and the Depositor a
certification from such transferee in the form hereof to confirm that
the proposed sale is being made pursuant to an exemption from, or in a
transaction not subject to, the registration requirements of the
Securities Act. We further understand that the Privately Offered
Certificates purchased by us will bear a legend to the foregoing effect.
(3) We are acquiring the Privately Offered Certificates for investment
purposes and not with a view to, or for offer or sale in connection
with, any distribution in violation of the Securities Act. We have such
knowledge and experience in financial and business matters as to be
capable of evaluating the merits and risks of our investment in the
Privately Offered Certificates, and we and any account for which we are
acting are each able to bear the economic risk of such investment.
(4) We are an Institutional Accredited Investor and we are acquiring the
Privately Offered Certificates purchased by us for our own account or
for one or more accounts (each of which is an Institutional Accredited
Investor) as to each of which we exercise sole investment discretion.
(5) We have received such information as we deem necessary in order to make
our investment decision.
(6) If we are acquiring ERISA-Restricted Certificates, we understand that in
accordance with ERISA, the Code and the Exemption, no Plan as to which
the Purchaser, the Depositor, any Servicer or Master Servicer or the
Trustee is a party in interest or disqualified person, and no person
acting on behalf of such a Plan may acquire such Certificate unless the
acquisition would constitute an exempt transaction under a statutory
exemption or any of the administrative exemptions issued by the U.S.
Department of Labor.
Terms used in this letter which are not otherwise defined herein have
the respective meanings assigned thereto in the Trust Agreement.
You and the Depositor are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceeding or official
inquiry with respect to the matters covered hereby.
Very truly yours,
__________________________________
(Purchaser)
By________________________________
Name:
Title:
EXHIBIT H
---------
(FORM OF ERISA TRANSFER AFFIDAVIT)
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
The undersigned, being first duly sworn, deposes and says as
follows:
1. The undersigned is the ______________________ of (the
"Investor"), a (corporation duly organized) and existing under the laws of
__________, on behalf of which he makes this affidavit.
2. The Investor either (x) is not an employee benefit plan
subject to Section 406 or Section 407 of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), or Section 4975 of the Internal
Revenue Code of 1986, as amended (the "Code"), the Trustee of any such plan
or a person acting on behalf of any such plan nor a person using the assets
of any such plan or (2) if the Investor is an insurance company, such
Investor is purchasing such Certificates with funds contained in an
"Insurance Company General Account" (as such term is defined in Section v(e)
of the Prohibited Transaction Class Exemption 95-60 ("PTCE 95-60")) and that
the purchase and holding of such Certificates are covered under PTCE 95-60;
or (y) shall deliver to the Trustee and the Depositor an opinion of counsel
(a "Benefit Plan Opinion") satisfactory to the Trustee and the Depositor, and
upon which the Trustee and the Depositor shall be entitled to rely, to the
effect that the purchase or holding of such Certificate by the Investor will
not result in the assets of the Trust Fund being deemed to be plan assets and
subject to the prohibited transaction provisions of ERISA or the Code and
will not subject the Trustee or the Depositor to any obligation in addition
to those undertaken by such entities in the Trust Agreement, which opinion of
counsel shall not be an expense of the Trustee or the Depositor.
3. The Investor hereby acknowledges that under the terms of the
Trust Agreement (the "Agreement") between Structured Asset Securities
Corporation, as Depositor, and Norwest Bank Minnesota, N.A., as Trustee,
dated 1, 199 , no transfer of the ERISA-Restricted
------------- -
Certificates shall be permitted to be made to any person unless the Depositor
and Trustee have received a certificate from such transferee in the form
hereof.
IN WITNESS WHEREOF, the Investor has caused this instrument to be
executed on its behalf, pursuant to proper authority, by its duly authorized
officer, duly attested, this ____ day of _______________, 199 .
-
_________________________________
(Investor)
By:______________________________
Name:
Title:
ATTEST:
___________________________
STATE OF )
)ss.:
COUNTY OF )
Personally appeared before me the above-named
_________________, known or proved to me to be the same person who executed
the foregoing instrument and to be the _________________ of the Investor, and
acknowledged that he executed the same as his free act and deed and the free
act and deed of the Investor.
Subscribed and sworn before me this _____ day of ___________ 199__.
__________________________________
NOTARY PUBLIC
My commission expires the
____ day of __________, 19__.
EXHIBIT K
---------
CUSTODIAL AGREEMENT
SCHEDULE A
----------
MORTGAGE LOAN SCHEDULE
SCHEDULE B
----------
PRINCIPAL AMOUNT SCHEDULES
(Not Applicable)
