Exhibit 4.1
ARGENT SECURITIES INC.
Depositor
AMERIQUEST MORTGAGE COMPANY
Master Servicer
and
DEUTSCHE BANK NATIONAL TRUST COMPANY
Trustee
-------------------------------------------
POOLING AND SERVICING AGREEMENT
Dated as of May 1, 2004
-----------------------------------------
Asset-Backed Pass-Through Certificates
Series 2004-W7
TABLE OF CONTENTS
SECTION PAGE
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ARTICLE I
DEFINITIONS
SECTION 1.01. Defined Terms........................................................................7
SECTION 1.02. Allocation of Certain Interest Shortfalls...........................................66
SECTION 1.03 Rights of the NIMS Insurer..........................................................68
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
SECTION 2.01. Conveyance of Mortgage Loans........................................................68
SECTION 2.02. Acceptance of REMIC I by the Trustee................................................71
SECTION 2.03. Repurchase or Substitution of Mortgage Loans by the Seller or the
Depositor; Payment of Prepayment Charge Payment Amounts.............................72
SECTION 2.04. [Reserved]..........................................................................75
SECTION 2.05. Representations, Warranties and Covenants of the Master Servicer....................75
SECTION 2.06. Issuance of the REMIC I Regular Interests and the Class R-I Interest................78
SECTION 2.07. Conveyance of the REMIC I Regular Interests; REMIC I, REMIC II, REMIC III,
REMIC IV and REMIC V by the Trustee by the Trustee..................................78
SECTION 2.08. Issuance of Class R Certificates and Class R-X Certificates.........................80
SECTION 2.09. Conveyance of the Subsequent Mortgage Loans.........................................80
ARTICLE III
ADMINISTRATION AND SERVICING
OF THE MORTGAGE LOANS
SECTION 3.01. Master Servicer to Act as Master Servicer...........................................83
SECTION 3.02. Collection of Certain Mortgage Loan Payments........................................85
SECTION 3.03. [Reserved]..........................................................................86
SECTION 3.04. Collection Account, Escrow Account and Distribution Account.........................86
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SECTION PAGE
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SECTION 3.05. Permitted Withdrawals From the Collection Account, Escrow
Account and Distribution Account.....................................................90
SECTION 3.06. Investment of Funds in the Collection Account, the Escrow Account,
the REO Account and the Distribution Account.........................................93
SECTION 3.07. Payment of Taxes, Insurance and Other Charges........................................95
SECTION 3.08. Maintenance of Hazard Insurance......................................................95
SECTION 3.09. Maintenance of Mortgage Blanket Insurance............................................96
SECTION 3.10. Fidelity Bond; Errors and Omissions Insurance........................................96
SECTION 3.11. Enforcement of Due-On-Sale Clauses; Assumption Agreements............................97
SECTION 3.12. Realization Upon Defaulted Mortgage Loans............................................98
SECTION 3.13. Title, Management and Disposition of REO Property....................................99
SECTION 3.14. [Reserved]..........................................................................103
SECTION 3.15. Reports of Foreclosure and Abandonment of Mortgaged Properties......................103
SECTION 3.16. Optional Purchase of Defaulted Mortgage Loans.......................................103
SECTION 3.17. Trustee to Cooperate; Release of Mortgage Files.....................................104
SECTION 3.18. Servicing Compensation..............................................................105
SECTION 3.19. Statement as to Compliance..........................................................106
SECTION 3.20. Independent Public Accountants' Servicing Report....................................106
SECTION 3.21. Access to Certain Documentation.....................................................107
SECTION 3.22. [Reserved]..........................................................................107
SECTION 3.23. Advance Facility....................................................................107
ARTICLE IV
PAYMENTS TO CERTIFICATEHOLDERS
SECTION 4.01. Distributions.......................................................................110
SECTION 4.02. Statements to Certificateholders....................................................120
SECTION 4.03. Remittance Reports and Other Reports to the Trustee; Advances;
Payments in Respect of Prepayment Interest Shortfalls...............................124
SECTION 4.04. Allocation of Realized Losses.......................................................126
SECTION 4.05. Compliance with Withholding Requirements............................................129
SECTION 4.06. Commission Reporting................................................................129
SECTION 4.07. Pre-Funding Accounts................................................................131
SECTION 4.08. Interest Coverage Account...........................................................132
SECTION 4.09. [Reserved]..........................................................................133
SECTION 4.10 Net WAC Rate Carryover Reserve Account..............................................133
ARTICLE V
THE CERTIFICATES
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SECTION PAGE
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SECTION 5.01. The Certificates....................................................................134
SECTION 5.02. Registration of Transfer and Exchange of Certificates...............................136
SECTION 5.03. Mutilated, Destroyed, Lost or Stolen Certificates...................................142
SECTION 5.04. Persons Deemed Owners...............................................................142
SECTION 5.05. Certain Available Information.......................................................143
ARTICLE VI
THE DEPOSITOR AND THE MASTER SERVICER
SECTION 6.01. Liability of the Depositor and the Master Servicer..................................144
SECTION 6.02. Merger or Consolidation of the Depositor or the Master Servicer.....................144
SECTION 6.03. Limitation on Liability of the Depositor, the Master Servicer and Others............144
SECTION 6.04. Limitation on Resignation of the Master Servicer....................................145
SECTION 6.05. Rights of the Depositor in Respect of the Master Servicer...........................146
SECTION 6.06. Sub-Servicing Agreements Between the Master Servicer and Sub-Servicers..............147
SECTION 6.07. Successor Sub-Servicers.............................................................148
SECTION 6.08. Liability of the Master Servicer....................................................149
SECTION 6.09. No Contractual Relationship Between Sub-Servicers and the NIMS Insurer,
the Trustee or Certificateholders...................................................149
SECTION 6.10. Assumption or Termination of Sub-Servicing Agreements by Trustee....................149
SECTION 6.11. Sub-Servicing Accounts..............................................................150
ARTICLE VII
DEFAULT
SECTION 7.01. Master Servicer Events of Default...................................................151
SECTION 7.02. Trustee to Act; Appointment of Successor............................................153
SECTION 7.03. Notification to Certificateholders..................................................156
SECTION 7.04. Waiver of Master Servicer Events of Default.........................................156
ARTICLE VIII
CONCERNING THE TRUSTEE
SECTION 8.01. Duties of Trustee...................................................................157
SECTION 8.02. Certain Matters Affecting the Trustee...............................................158
SECTION 8.03. The Trustee Not Liable for Certificates or Mortgage Loans...........................159
SECTION 8.04. Trustee May Own Certificates........................................................160
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SECTION PAGE
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SECTION 8.05. Trustee's Fees and Expenses.........................................................160
SECTION 8.06. Eligibility Requirements for Trustee................................................160
SECTION 8.07. Resignation and Removal of the Trustee..............................................161
SECTION 8.08. Successor Trustee...................................................................161
SECTION 8.09. Merger or Consolidation of Trustee..................................................162
SECTION 8.10. Appointment of Co-Trustee or Separate Trustee.......................................162
SECTION 8.11. Appointment of Custodians...........................................................163
SECTION 8.12. Appointment of Office or Agency.....................................................164
SECTION 8.13. Representations and Warranties of the Trustee.......................................164
ARTICLE IX
TERMINATION
SECTION 9.01 Termination Upon Repurchase or Liquidation of All Mortgage Loans....................165
SECTION 9.02 Additional Termination Requirements.................................................167
ARTICLE X
REMIC PROVISIONS
SECTION 10.01. REMIC Administration................................................................169
SECTION 10.02. Prohibited Transactions and Activities..............................................171
SECTION 10.03. Master Servicer and Trustee Indemnification.........................................172
ARTICLE XI
MISCELLANEOUS PROVISIONS
SECTION 11.01. Amendment...........................................................................173
SECTION 11.02. Recordation of Agreement; Counterparts..............................................174
SECTION 11.03. Limitation on Rights of Certificateholders..........................................174
SECTION 11.04. Governing Law.......................................................................175
SECTION 11.05. Notices.............................................................................175
SECTION 11.06. Severability of Provisions..........................................................176
SECTION 11.07. Notice to Rating Agencies and the NIMS Insurer......................................176
SECTION 11.08. Article and Section References......................................................177
SECTION 11.09. Grant of Security Interest..........................................................177
SECTION 11.10 Third Party Rights..................................................................178
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Exhibits
Exhibit A-1 Form of Class A-1 Certificate
Exhibit A-2 Form of Class A-2 Certificate
Exhibit A-3 Form of Class A-3 Certificate
Exhibit A-4 Form of Class A-4 Certificate
Exhibit A-5 Form of Class A-5 Certificate
Exhibit A-6 Form of Class M-1 Certificate
Exhibit A-7 Form of Class M-2 Certificate
Exhibit A-8 Form of Class M-3 Certificate
Exhibit A-9 Form of Class M-4 Certificate
Exhibit A-10 Form of Class M-5 Certificate
Exhibit A-11 Form of Class M-6 Certificate
Exhibit A-12 Form of Class M-7 Certificate
Exhibit A-13 Form of Class M-8 Certificate
Exhibit A-14 Form of Class M-9 Certificate
Exhibit A-15 Form of Class M-10 Certificate
Exhibit A-16 Form of Class CE Certificate
Exhibit A-17 Form of Class P Certificate
Exhibit A-18 Form of Class R Certificate
Exhibit A-19 Form of Class R-X Certificate
Exhibit B Form of Lost Note Affidavit
Exhibit C-1 Form of Trustee's Initial Certification
Exhibit C-2 Form of Trustee's Final Certification
Exhibit C-3 Form of Trustee's Receipt of Mortgage Note
Exhibit D Form of Mortgage Loan Purchase Agreement
Exhibit E Request for Release
Exhibit F-1 Form of Transferor Representation Letter and Form of
Transferee Representation Letter in Connection with
Transfer of Class CE and Class P Certificates Pursuant to
Rule 144A Under the 1933 Act
Exhibit F-2 Form of Transfer Affidavit and Agreement and Form of Transferor
Affidavit in Connection with Transfer of Residual Certificates
Exhibit G Form of Certification with respect to ERISA and the Code
Exhibit H Form of Cap Contracts
Exhibit I Loss Mitigation Action Plan
Exhibit J-1 Form of Certification to Be Provided by the Depositor with
Form 10-K
Exhibit J-2 Form of Certification to Be Provided to Depositor by the Trustee
Exhibit K Form of Addition Notice
Exhibit L Form of Subsequent Transfer Instrument
Exhibit M Annual Statement of Compliance pursuant to Section 3.19
Exhibit N Form of Special Sub-Servicing Agreement
Schedule 1 Mortgage Loan Schedule
Schedule 2 Prepayment Charge Schedule
vi
This Pooling and Servicing Agreement, is dated and effective as of
May 1, 2004, among ARGENT SECURITIES INC., as Depositor, AMERIQUEST MORTGAGE
COMPANY, as Master Servicer and DEUTSCHE BANK NATIONAL TRUST COMPANY, as
Trustee.
PRELIMINARY STATEMENT:
The Depositor intends to sell pass-through certificates
(collectively, the "Certificates"), to be issued hereunder in multiple classes,
which in the aggregate will evidence the entire beneficial ownership interest in
each REMIC (as defined herein) created hereunder. The Trust Fund will consist of
a segregated pool of assets consisting of the Mortgage Loans and certain other
related assets subject to this Agreement.
REMIC I
As provided herein, the Trustee will elect to treat the segregated pool of
assets consisting of the Mortgage Loans and certain other related assets (other
than any Master Servicer Prepayment Charge Payment Amounts, the Pre-Funding
Accounts, the Interest Coverage Account, the Subsequent Mortgage Loan Interest,
the Net WAC Rate Carryover Reserve Account and the Cap Contracts) subject to
this Agreement as a REMIC for federal income tax purposes, and such segregated
pool of assets will be designated as "REMIC I." The Class R-I Interest will be
the sole class of "residual interests" in REMIC I for purposes of the REMIC
Provisions (as defined herein). The following table irrevocably sets forth the
designation, the REMIC I Remittance Rate, the initial Uncertificated Balance
and, solely for purposes of satisfying Treasury regulation section 1.860G-
1(a)(4)(iii), the "latest possible maturity date" for each of the REMIC I
Regular Interests (as defined herein). None of the REMIC I Regular Interests
will be certificated.
REMIC I Initial Latest Possible
Designation Remittance Rate Uncertificated Balance Maturity Date(1)
----------- --------------- ---------------------- ----------------
I-LT1 Variable(2) $ 635,640,009.12 May 2034
I-LT1PF Variable(2) $ 158,910,796.00 May 0000
X-XX0 Variable(2) $ 164,360,065.11 May 2034
I-LT2PF Variable(2) $ 41,089,473.00 May 0000
X-XXX Variable(2) $ 100.00 May 2034
--------------------------------------------------------------------------------
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(1) Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
regulations, the Distribution Date immediately following the maturity date
for the Mortgage Loan with the latest maturity date has been designated as
the "latest possible maturity date" for each REMIC I Regular Interest.
(2) Calculated in accordance with the definition of "REMIC I Remittance Rate"
herein.
2
REMIC II
As provided herein, the Trustee will elect to treat the segregated pool of
assets consisting of the REMIC I Regular Interests as a REMIC for federal income
tax purposes, and such segregated pool of assets will be designated as "REMIC
II." The Class R-II Interest will evidence the sole class of "residual
interests" in REMIC II for purposes of the REMIC Provisions under federal income
tax law. The Class R-II Interest will be the sole class of "residual interests"
in REMIC II for purposes of the REMIC Provisions (as defined herein). The
following table irrevocably sets forth the designation, the REMIC II Remittance
Rate, the initial Uncertificated Balance and, solely for purposes of satisfying
Treasury regulation section 1.860G-1(a)(4)(iii), the "latest possible maturity
date" for each of the REMIC II Regular Interests (as defined herein). None of
the REMIC II Regular Interests will be certificated.
REMIC II Initial Latest Possible
Designation Remittance Rate Uncertificated Balance Maturity Date(1)
----------- --------------- ---------------------- ----------------
II-LTAA Variable(2) $490,000,168.18 May 2034
II-LTA1 Variable(2) $ 2,791,800.00 May 2034
II-LTA2 Variable(2) $ 310,200.00 May 2034
II-LTA3 Variable(2) $ 440,000.00 May 2034
II-LTA4 Variable(2) $ 213,500.00 May 2034
II-LTA5 Variable(2) $ 144,500.00 May 2034
II-LTM1 Variable(2) $ 200,000.00 May 2034
II-LTM2 Variable(2) $ 162,500.00 May 2034
II-LTM3 Variable(2) $ 100,000.00 May 2034
II-LTM4 Variable(2) $ 50,000.00 May 2034
II-LTM5 Variable(2) $ 140,000.00 May 2034
II-LTM6 Variable(2) $ 62,500.00 May 2034
II-LTM7 Variable(2) $ 55,000.00 May 2034
II-LTM8 Variable(2) $ 50,000.00 May 2034
II-LTM9 Variable(2) $ 60,000.00 May 2034
II-LTM10 Variable(2) $ 72,500.00 May 2034
II-LTZZ Variable(2) $ 5,147,503.43 May 2034
II-LTP Variable(2) $ 100.00 May 2034
II-1SUB Variable(2) $ 17,415.08 May 2034
II-1GRP Variable(2) $ 63,564.01 May 2034
II-2SUB Variable(2) $ 4,584.95 May 2034
II-2GRP Variable(2) $ 16,436.01 May 2034
II-XX Variable(2) $499,898,171.56 May 2034
----------
(1) Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
regulations, the Distribution Date immediately following the maturity date
for the Mortgage Loan with the latest maturity date has been designated as
the "latest possible maturity date" for each REMIC II Regular Interest.
(2) Calculated in accordance with the definition of "REMIC II Remittance Rate"
herein.
3
REMIC III
As provided herein, the Trustee will elect to treat the segregated pool of
assets consisting of the REMIC II Regular Interests as a REMIC for federal
income tax purposes, and such segregated pool of assets will be designated as
"REMIC III." The Class R-III Interest will evidence the sole class of "residual
interests" in REMIC III for purposes of the REMIC Provisions under federal
income tax law. The following table irrevocably sets forth the designation, the
Pass-Through Rate, the initial aggregate Certificate Principal Balance and,
solely for purposes of satisfying Treasury regulation section
1.860G-1(a)(4)(iii), the "latest possible maturity date" for the indicated
Classes of Certificates.
Initial Aggregate Latest Possible
Designation Pass-Through Rate Certificate Principal Balance Maturity Date(1)
----------- ----------------- ----------------------------- ----------------
Class A-1 Variable(2) $558,360,000.00 May 2034
Class A-2 Variable(2) $ 62,040,000.00 May 2034
Class A-3 Variable(2) $ 88,000,000.00 May 2034
Class A-4 Variable(2) $ 42,700,000.00 May 2034
Class A-5 Variable(2) $ 28,900,000.00 May 2034
Class M-1 Variable(2) $ 40,000,000.00 May 2034
Class M-2 Variable(2) $ 32,500,000.00 May 2034
Class M-3 Variable(2) $ 20,000,000.00 May 2034
Class M-4 Variable(2) $ 10,000,000.00 May 2034
Class M-5 Variable(2) $ 28,000,000.00 May 2034
Class M-6 Variable(2) $ 12,500,000.00 May 2034
Class M-7 Variable(2) $ 11,000,000.00 May 2034
Class M-8 Variable(2) $ 10,000,000.00 May 2034
Class M-9 Variable(2) $ 12,000,000.00 May 2034
Class M-10 Variable(2) $ 14,500,000.00 May 2034
Class CE Interest Variable(3) $ 29,500,343.23 May 2034
Class P Interest N/A(4) $ 100.00 May 2034
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(1) Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
regulations, the Distribution Date immediately following the maturity date
for the Mortgage Loans with the latest maturity date has been designated
as the "latest possible maturity date" for each Class of Certificates.
(2) Calculated in accordance with the definition of "Pass-Through Rate"
herein.
(3) The Class CE Interest will accrue interest at its variable Pass-Through
Rate on the Notional Amount of the Class CE Interest outstanding from time
to time which shall equal the Uncertificated Balance of the REMIC II
Regular Interests. The Class CE Interest will not accrue interest on its
Uncertificated Balance.
(4) The Class P Interest will not accrue interest.
4
REMIC IV
As provided herein, the Trustee will elect to treat the segregated pool of
assets consisting of the Class CE Interest as a REMIC for federal income tax
purposes, and such segregated pool of assets will be designated as "REMIC IV."
The Class R-IV Interest will evidence the sole class of "residual interests" in
REMIC IV for purposes of the REMIC Provisions under federal income tax law. The
following table irrevocably sets forth the designation, the Pass-Through Rate,
the initial aggregate Certificate Principal Balance and, solely for purposes of
satisfying Treasury regulation section 1.860G-1(a)(4)(iii), the "latest possible
maturity date" for the indicated Classes of Certificates.
Initial Aggregate
Certificate Principal Latest Possible
Class Designation Pass-Through Rate Balance Maturity Date(1)
----------------- ----------------- --------------------- ----------------
Class CE Certificates Variable(2) $29,500,169.00 May 2034
----------
(1) Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
regulations, the Distribution Date immediately following the maturity date
for the Mortgage Loans with the latest maturity date has been designated
as the "latest possible maturity date" for the Class CE Certificates.
(2) The Class CE Certificates will receive 100% of amounts received in respect
of the Class CE Interest.
5
REMIC V
As provided herein, the Trustee shall make an election to treat the
segregated pool of assets consisting of the Class P Interest as a REMIC for
federal income tax purposes, and such segregated pool of assets will be
designated as "REMIC V." The Class R-V Interest represents the sole class of
"residual interests" in REMIC V for purposes of the REMIC Provisions. The
following table irrevocably sets forth the designation, the Pass-Through Rate,
the initial aggregate Certificate Principal Balance and, solely for purposes of
satisfying Treasury regulation section 1.860G- 1(a)(4)(iii), the "latest
possible maturity date" for the indicated Classes of Certificates.
Initial Aggregate
Certificate Principal Latest Possible
Class Designation Pass-Through Rate Balance Maturity Date(1)
----------------- ----------------- --------------------- ----------------
Class P Certificates Variable(2) $100.00 May 2034
----------
(1) Solely for purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
regulations, the Distribution Date immediately following the maturity date
for the Mortgage Loans with the latest maturity date has been designated
as the "latest possible maturity date" for the Class P Certificates.
(2) The Class P Certificates will receive 100% of amounts received in respect
of the Class P Interest.
As of the Cut-off Date, the Group I Mortgage Loans had an aggregate
Scheduled Principal Balance equal to $635,640,109.12 and the Group II Mortgage
Loans had an aggregate Scheduled Principal Balance equal to $164,360,065.11.
In consideration of the mutual agreements herein contained, the Depositor,
the Master Servicer and the Trustee agree as follows:
6
ARTICLE I
DEFINITIONS
SECTION 1.01. Defined Terms.
Whenever used in this Agreement, including, without limitation, in
the Preliminary Statement hereto, the following words and phrases, unless the
context otherwise requires, shall have the meanings specified in this Article.
Unless otherwise specified, all calculations described herein shall be made on
the basis of a 360-day year consisting of twelve 30-day months and all
calculations on each Regular Interest shall be made on the basis of a 360-day
year and the actual number of days in the month.
"Accrued Certificate Interest": With respect to any Class of
Certificates (other than the Class P Certificates and the Residual Certificates)
and each Distribution Date, interest accrued during the related Interest Accrual
Period at the Pass-Through Rate for such Certificate for such Distribution Date
on the Certificate Principal Balance, in the case of the Class A Certificates
and the Mezzanine Certificates, or on the Notional Amount, in the case of the
Class CE Certificates, of such Certificate immediately prior to such
Distribution Date. The Class P Certificates are not entitled to distributions in
respect of interest and, accordingly, shall not accrue interest. All
distributions of interest on the Adjustable-Rate Certificates shall be
calculated on the basis of a 360-day year and the actual number of days in the
applicable Interest Accrual Period. All distributions of interest on Fixed-Rate
Certificates and the Class CE Certificates shall be based on a 360-day year
consisting of twelve 30-day months. Accrued Certificate Interest with respect to
each Distribution Date, as to any Class A Certificate or Mezzanine Certificate,
shall be reduced by an amount equal to the portion allocable to such Certificate
pursuant to Section 1.02 hereof of the sum of (a) the aggregate Prepayment
Interest Shortfall, if any, for such Distribution Date to the extent not covered
by payments pursuant to Section 4.03(e) or allocated to the Class CE
Certificates and (b) the aggregate amount of any Relief Act Interest Shortfall,
if any, for such Distribution Date not allocated to the Class CE Certificates
pursuant to Section 1.02. Accrued Certificate Interest with respect to each
Distribution Date and any Class CE Certificate shall be reduced by (a)
Prepayment Interest Shortfalls, if any, allocated to such Class of Certificate
pursuant to Section 1.02 hereof and (b) Relief Act Interest Shortfalls, if any,
allocated to such Class of Certificate pursuant to Section 1.02 hereof.
"Addition Notice": With respect to the transfer of Subsequent
Mortgage Loans to the Trust Fund pursuant to Section 2.09, a notice of the
Depositor's designation of the Subsequent Mortgage Loans to be sold to the Trust
Fund and the aggregate Principal Balance of such Subsequent Mortgage Loans as of
the related Subsequent Cut-off Date. The Addition Notice shall be given not
later than three Business Days prior to the related Subsequent Transfer Date and
shall be substantially in the form of Exhibit K.
"Adjustable-Rate Certificates": The Adjustable-Rate Class A
Certificates and the Adjustable-Rate Mezzanine Certificates.
"Adjustable-Rate Mezzanine Certificates": The Mezzanine
Certificates.
7
"Adjustable-Rate Mortgage Loan": Each of the Mortgage Loans
identified on the Mortgage Loan Schedule as having a Mortgage Rate that is
subject to adjustment.
"Adjustment Date": With respect to the Adjustable-Rate Mortgage
Loans, the first day of the month in which the Mortgage Rate of such Mortgage
Loan changes pursuant to the related Mortgage Note. The first Adjustment Date
following the Cut-off Date as to each Adjustable-Rate Mortgage Loan is set forth
in the Mortgage Loan Schedule.
"Advance": As to any Mortgage Loan or REO Property, any advance made
by the Master Servicer or a successor Master Servicer in respect of any
Distribution Date representing the aggregate of all payments of principal and
interest, net of the Servicing Fee, that were due during the related Due Period
on the Mortgage Loans and that were delinquent on the related Determination
Date, plus certain amounts representing assumed payments not covered by any
current net income on the Mortgaged Properties acquired by foreclosure or deed
in lieu of foreclosure as determined pursuant to Section 4.03.
"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.
"Agreement": This Pooling and Servicing Agreement and all amendments
hereof and supplements hereto.
"Allocated Realized Loss Amount": With respect to any Distribution
Date and any Class of Mezzanine Certificates, the sum of (i) any Realized Losses
allocated to such Class of Certificates on such Distribution Date and (ii) the
amount of any Allocated Realized Loss Amount for such Class of Certificates
remaining unpaid from the previous Distribution Date minus the amount of the
increase in the related Certificate Principal Balance due to the receipt of
Subsequent Recoveries as provided in Section 4.01.
"Applicable Regulations": As to any Mortgage Loan, all federal,
state and local laws, statutes, rules and regulations applicable thereto.
"Assignment": An assignment of Mortgage, notice of transfer or
equivalent instrument, in recordable form (excepting therefrom if applicable,
the mortgage recordation information which has not been returned by the
applicable recorder's office and/or the assignee's name), which is sufficient
under the laws of the jurisdiction wherein the related Mortgaged Property is
located to reflect of record the sale of the Mortgage.
"Available Funds": With respect to any Distribution Date, an amount
equal to (1) the sum of (a) the aggregate of the amounts on deposit in the
Collection Account and Distribution Account as of the close of business on the
related Determination Date, including any Subsequent Recoveries, (b) the
aggregate of any amounts received in respect of an REO Property withdrawn
8
from any REO Account and deposited in the Distribution Account for such
Distribution Date pursuant to Section 3.13, (c) Compensating Interest, if any,
deposited in the Distribution Account by the Master Servicer for such
Distribution Date pursuant to Section 4.03(e), (d) the aggregate of any Advances
made by the Master Servicer for such Distribution Date pursuant to Section 4.03,
(e) the aggregate of any Advances made by the successor Master Servicer or the
Trustee for such Distribution Date pursuant to Section 7.02(b), (f) with respect
to the Distribution Date immediately following the end of the Funding Period,
any amounts previously held in the Pre-Funding Accounts after giving effect to
any purchase of Subsequent Mortgage Loans and (g) with respect to each
Distribution Date during the Funding Period and on the Distribution Date
immediately following the end of the Funding Period, any amounts withdrawn by
the Trustee from the Interest Coverage Account for distribution on the
Certificates on such Distribution Date, reduced (to not less than zero) by (2)
the sum of (x) the portion of the amount described in clause (1)(a) above that
represents (i) Monthly Payments on the Mortgage Loans received from a Mortgagor
on or prior to the Determination Date but due during any Due Period subsequent
to the related Due Period, (ii) Principal Prepayments on the Mortgage Loans
received after the related Prepayment Period (together with any interest
payments received with such Principal Prepayments to the extent they represent
the payment of interest accrued on the Mortgage Loans during a period subsequent
to the end of the prior calendar month), (iii) Liquidation Proceeds, Insurance
Proceeds and Subsequent Recoveries received in respect of the Mortgage Loans
after the related Prepayment Period, (iv) amounts reimbursable or payable to the
Depositor, the Master Servicer, the Trustee, the Seller or any Sub-Servicer
pursuant to Section 3.05 or Section 3.06 or otherwise payable in respect of
Extraordinary Trust Fund Expenses, (v) Stayed Funds, (vi) the Trustee Fee
payable from the Distribution Account pursuant to Section 8.05, (vii) amounts
deposited in the Collection Account or the Distribution Account in error and
(viii) the amount of any Prepayment Charges collected by the Master Servicer and
the amount of any Master Servicer Prepayment Charge Payment Amounts and (y)
amounts reimbursable to the Trustee for an advance made pursuant to Section
7.02(b) which advance the Trustee has determined to be nonrecoverable from the
Stayed Funds in respect of which it was made.
"Bankruptcy Code": The Bankruptcy Reform Act of 1978 (Title 11 of
the United States Code), as amended.
"Bankruptcy Loss": With respect to any Mortgage Loan, a Realized
Loss resulting from a Deficient Valuation or Debt Service Reduction.
"Book-Entry Certificate": Any Certificate registered in the name of
the Depository or its nominee. Initially, the Book-Entry Certificates shall be
the Class A Certificates and the Mezzanine Certificates.
"Book-Entry Custodian": The custodian appointed pursuant to Section
5.01.
"Business Day": Any day other than a Saturday, a Sunday or a day on
which banking or savings and loan institutions in the State of California, the
State of New York, or in the city in which the Corporate Trust Office of the
Trustee is located, are authorized or obligated by law or executive order to be
closed.
9
"Cap Amount": For the Class A-2 Certificates, the aggregate amount
received by the Trust Fund from the Class A-2 Cap Contract.
For each Class of Group II Certificates, the product of (i) the
aggregate amount received by the Trust Fund from the Group II Cap Contract
multiplied by (ii) a fraction equal to (a) the Certificate Principal Balance of
such Class immediately prior to the applicable Distribution Date divided by (b)
the aggregate Certificate Principal Balance of the Group II Certificates
immediately prior to the applicable Distribution Date.
For each Class of Mezzanine Certificates, the product of (i) the
aggregate amount received by the Trust Fund from the Mezzanine Cap Contract
multiplied by (ii) a fraction equal to (a) the Certificate Principal Balance of
such Class immediately prior to the applicable Distribution Date divided by (b)
the aggregate Certificate Principal Balance of all Classes of Mezzanine
Certificates immediately prior to the applicable Distribution Date.
"Cap Contract Excess": As to any Cap Contract and Distribution Date,
the excess, if any, of the then-applicable maximum rate set forth in such Cap
Contract over the then-applicable strike rate set forth therein.
"Cap Contracts": Collectively, the Class A-2 Cap Contract, the Group
II Cap Contract and the Mezzanine Cap Contract.
"Certificate": Any one of the Depositor's Asset-Backed Pass-Through
Certificates, Series 2004-W7, Class A-1, Class X-0, Xxxxx X-0, Class X-0, Xxxxx
X-0, Class M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6, Class
M-7, Class M-8, Class M-9, Class M-10, Class CE, Class P, Class R and Class R-X
issued under this Agreement.
"Certificate Factor": With respect to any Class of Regular
Certificates as of any Distribution Date, a fraction, expressed as a decimal
carried to six places, the numerator of which is the aggregate Certificate
Principal Balance (or the Notional Amount, in the case of the Class CE
Certificates) of such Class of Certificates on such Distribution Date (after
giving effect to any distributions of principal and allocations of Realized
Losses in reduction of the Certificate Principal Balance (or the Notional
Amount, in the case of the Class CE Certificates) of such Class of Certificates
to be made on such Distribution Date), and the denominator of which is the
initial aggregate Certificate Principal Balance (or the Notional Amount, in the
case of the Class CE Certificates) of such Class of Certificates as of the
Closing Date.
"Certificateholder" or "Holder": The Person in whose name a
Certificate is registered in the Certificate Register, except that a
Disqualified Organization or a Non-United States Person shall not be a Holder of
a Residual Certificate for any purposes hereof and, solely for the purposes of
giving any consent pursuant to this Agreement, any Certificate registered in the
name of the Depositor or the Master Servicer or any Affiliate thereof shall be
deemed not to be outstanding and the Voting Rights to which it is entitled shall
not be taken into account in determining whether the requisite percentage of
Voting Rights necessary to effect any such consent has been obtained, except as
otherwise provided in Section 11.01. The Trustee and the NIMS Insurer may
conclusively rely upon a certificate of the Depositor or the Master Servicer in
determining whether a Certificate is held
10
by an Affiliate thereof. All references herein to "Holders" or
"Certificateholders" shall reflect the rights of Certificate Owners as they may
indirectly exercise such rights through the Depository and participating members
thereof, except as otherwise specified herein; provided, however, that the
Trustee and the NIMS Insurer shall be required to recognize as a "Holder" or
"Certificateholder" only the Person in whose name a Certificate is registered in
the Certificate Register.
"Certificate Margin": With respect to the Adjustable-Rate
Certificates and, for purposes of the Marker Rate, the specified REMIC II
Regular Interest, as follows:
Class REMIC I Regular Interest Certificate Margin
----- ------------------------ ------------------
(1) (%) (2) (%)
A-1 REMIC II Regular Interest II-LTA1 0.260 0.520
A-2 REMIC II Regular Interest II-LTA2 0.520 1.040
A-3 REMIC II Regular Interest II-LTA3 0.110 0.220
A-4 REMIC II Regular Interest II-LTA4 0.220 0.440
A-5 REMIC II Regular Interest II-LTA5 0.530 1.060
M-1 REMIC II Regular Interest II-LTM1 0.550 0.825
M-2 REMIC II Regular Interest II-LTM2 0.600 0.900
M-3 REMIC II Regular Interest II-LTM3 0.720 1.080
M-4 REMIC II Regular Interest II-LTM4 1.200 1.800
M-5 REMIC II Regular Interest II-LTM5 1.350 2.025
M-6 REMIC II Regular Interest II-LTM6 1.600 2.400
M-7 REMIC II Regular Interest II-LTM7 1.950 2.925
M-8 REMIC II Regular Interest II-LTM8 2.250 3.375
M-9 REMIC II Regular Interest II-LTM9 3.200 4.800
M-10 REMIC II Regular Interest II-LTM10 2.500 3.750
----------
(1) On each Distribution Date prior to the Optional Termination Date.
(2) On each Distribution Date on and after the Optional Termination
Date.
"Certificate Owner": With respect to a Book-Entry Certificate, the
Person who is the beneficial owner of such Certificate as reflected on the books
of the Depository or on the books of a Depository Participant or on the books of
an indirect participating brokerage firm for which a Depository Participant acts
as agent.
"Certificate Principal Balance": With respect to each Class A
Certificate, Mezzanine Certificate or Class P Certificate as of any date of
determination, the Certificate Principal Balance of such Certificate on the
Distribution Date immediately prior to such date of determination minus all
distributions allocable to principal made thereon on such Distribution Date and,
in the case of a Mezzanine Certificate, Realized Losses allocated thereto on
such immediately prior Distribution Date plus, with respect to each Mezzanine
Certificate, any increase in the Certificate Principal Balance of such
Certificate pursuant to Section 4.01 due to the receipt of Subsequent Recoveries
(or, in the case of any date of determination up to and including the first
Distribution Date, the initial Certificate Principal Balance of such
Certificate, as stated on the face thereof). With respect to each Class CE
Certificate as of any date of determination, an amount equal to the Percentage
Interest evidenced by such Certificate times the excess, if any, of (A) the then
aggregate Uncertificated Balances of the REMIC I Regular Interests over (B) the
then aggregate Certificate Principal Balances of the Class A Certificates, the
Mezzanine Certificates and the Class P Certificates then outstanding.
11
"Certificate Register" and "Certificate Registrar": The register
maintained and the registrar appointed pursuant to Section 5.02.
"Class": Collectively, all of the Certificates bearing the same
class designation.
"Class A Certificate": Any one of the Class A-1 Certificates, the
Class A-2 Certificates, the Class A-3 Certificates, the Class A-4 Certificates
or the Class A-5 Certificates.
"Class A Principal Distribution Amount": With respect to any
Distribution Date, an amount equal to the sum of (i) the Senior Group I
Principal Distribution Amount and (ii) the Senior Group II Principal
Distribution Amount.
"Class A-1 Allocation Percentage": For any Distribution Date during
the Class A-2 Lockout Period will be 100%. For any Distribution Date after the
Class A-2 Lockout Period, will equal (x) if a Trigger Event is in effect, 100%
or (y) if a Trigger Event is not in effect, the percentage equivalent of a
fraction, the numerator of which will be (x) the Certificate Principal Balance
of the Class A-1 Certificates immediately prior to such Distribution Date and
the denominator of which will be (y) the aggregate Certificate Principal Balance
of the Group I Certificates immediately prior to such Distribution Date.
"Class A-1 Certificate": Any one of the Class A-1 Certificates
executed by the Trustee, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit A-1 and
evidencing a Regular Interest in REMIC III for purposes of the REMIC Provisions.
"Class A-2 Allocation Percentage": For any Distribution Date is 100%
minus the Class A-1 Allocation Percentage.
"Class A-2 Cap Contract": The cap contract between Deutsche Bank
National Trust Company, as Trustee and the counterparty thereunder, which is for
the benefit of the Holders of the Class A-2 Certificates, a form of which is
attached hereto as Exhibit H.
"Class A-2 Certificate": Any one of the Class A-2 Certificates
executed by the Trustee, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit A-2 and
evidencing a Regular Interest in REMIC III for purposes of the REMIC Provisions.
"Class A-2 Lockout Period": The period from the Closing Date to the
earlier of (x) the Distribution Date occurring in June 2007 and (y) the
Distribution Date on which the Certificate Principal Balance of the Class A-1
Certificates has been reduced to zero.
"Class A-3 Certificate": Any one of the Class A-3 Certificates
executed by the Trustee, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit A-3 and
evidencing a Regular Interest in REMIC III for purposes of the REMIC Provisions.
12
"Class A-4 Certificate": Any one of the Class A-4 Certificates
executed by the Trustee, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit A-4 and
evidencing a Regular Interest in REMIC III for purposes of the REMIC Provisions.
"Class A-5 Certificate": Any one of the Class A-5 Certificates
executed by the Trustee, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit A-5 and
evidencing a Regular Interest in REMIC III for purposes of the REMIC Provisions.
"Class CE Certificate": Any one of the Class CE Certificates
executed, authenticated and delivered by the Trustee, substantially in the form
annexed hereto as Exhibit A-16 and evidencing a Regular Interest in REMIC IV for
purposes of the REMIC Provisions.
"Class CE Interest": An uncertificated interest in the Trust Fund
held by the Trustee on behalf of the Holders of the Class CE Certificates,
evidencing a Regular Interest in REMIC III for purposes of the REMIC Provisions.
"Class M-1 Certificate": Any one of the Class M-1 Certificates
executed by the Trustee, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit A-6 and
evidencing a Regular Interest in REMIC III for purposes of the REMIC Provisions.
"Class M-1 Principal Distribution Amount": With respect to any
Distribution Date, an amount, not less than zero, equal to the lesser of (I) the
Certificate Principal Balance of the Class M-1 Certificates immediately prior to
such Distribution Date and (II) the excess of (x) the sum of (i) the aggregate
Certificate Principal Balance of the Class A Certificates (after taking into
account the payment of the Class A Principal Distribution Amount on such
Distribution Date), and (ii) the Certificate Principal Balance of the Class M-1
Certificates immediately prior to such Distribution Date over (y) the lesser of
(A) the product of (i) 64.00% and (ii) the aggregate Stated Principal Balance of
the Mortgage Loans as of the last day of the related Due Period (after giving
effect to scheduled payments of principal due during the related Due Period, to
the extent received or advanced, and unscheduled collections of principal
received during the related Prepayment Period) and (B) the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the related Due
Period (after giving effect to scheduled payments of principal due during the
related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period) minus
$5,000,001.
"Class M-2 Certificate": Any one of the Class M-2 Certificates
executed by the Trustee, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit A-7 and
evidencing a Regular Interest in REMIC III for purposes of the REMIC Provisions.
"Class M-2 Principal Distribution Amount": With respect to any
Distribution Date, an amount, not less than zero, equal to the lesser of (I) the
Certificate Principal Balance of the Class M-2 Certificates immediately prior to
such Distribution Date and (II) the excess of (x) the sum of
13
(i) the aggregate Certificate Principal Balance of the Class A Certificates
(after taking into account the payment of the Class A Principal Distribution
Amount on such Distribution Date), (ii) the Certificate Principal Balance of the
Class M-1 Certificates (after taking into account the payment of the Class M-1
Principal Distribution Amount on such Distribution Date) and (iii) the
Certificate Principal Balance of the Class M-2 Certificates immediately prior to
such Distribution Date over (y) the lesser of (A) the product of (i) 70.50% and
(ii) the aggregate Stated Principal Balance of the Mortgage Loans as of the last
day of the related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period) and (B) the aggregate Stated Principal Balance of the Mortgage Loans as
of the last day of the related Due Period (after giving effect to scheduled
payments of principal due during the related Due Period, to the extent received
or advanced, and unscheduled collections of principal received during the
related Prepayment Period) minus $5,000,001.
"Class M-3 Certificate": Any one of the Class M-3 Certificates
executed by the Trustee, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit A-8 and
evidencing a Regular Interest in REMIC III for purposes of the REMIC Provisions.
"Class M-3 Principal Distribution Amount": With respect to any
Distribution Date, an amount, not less than zero, equal to the lesser of (I) the
Certificate Principal Balance of the Class M-3 Certificates immediately prior to
such Distribution Date and (II) the excess of (x) the sum of (i) the aggregate
Certificate Principal Balance of the Class A Certificates (after taking into
account the payment of the Class A Principal Distribution Amount on such
Distribution Date), (ii) the Certificate Principal Balance of the Class M-1
Certificates (after taking into account the payment of the Class M-1 Principal
Distribution Amount on such Distribution Date), (iii) the Certificate Principal
Balance of the Class M-2 Certificates (after taking into account the payment of
the Class M-2 Principal Distribution Amount on such Distribution Date) and (iv)
the Certificate Principal Balance of the Class M-3 Certificates immediately
prior to such Distribution Date over (y) the lesser of (A) the product of (i)
74.50% and (ii) the aggregate Stated Principal Balance of the Mortgage Loans as
of the last day of the related Due Period (after giving effect to scheduled
payments of principal due during the related Due Period, to the extent received
or advanced, and unscheduled collections of principal received during the
related Prepayment Period) and (B) the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Due Period (after giving effect
to scheduled payments of principal due during the related Due Period, to the
extent received or advanced, and unscheduled collections of principal received
during the related Prepayment Period) minus $5,000,001.
"Class M-4 Certificate": Any one of the Class M-4 Certificates
executed by the Trustee, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit A-9 and
evidencing a Regular Interest in REMIC III for purposes of the REMIC Provisions.
"Class M-4 Principal Distribution Amount": With respect to any
Distribution Date, an amount, not less than zero, equal to the lesser of (I) the
Certificate Principal Balance of the Class M-4 Certificates immediately prior to
such Distribution Date and (II) the excess of (x) the sum of
14
(i) the aggregate Certificate Principal Balance of the Class A Certificates
(after taking into account the payment of the Class A Principal Distribution
Amount on such Distribution Date), (ii) the Certificate Principal Balance of the
Class M-1 Certificates (after taking into account the payment of the Class M-1
Principal Distribution Amount on such Distribution Date), (iii) the Certificate
Principal Balance of the Class M-2 Certificates (after taking into account the
payment of the Class M-2 Principal Distribution Amount on such Distribution
Date), (iv) the Certificate Principal Balance of the Class M-3 Certificates
(after taking into account the payment of the Class M-3 Principal Distribution
Amount on such Distribution Date), and (v) the Certificate Principal Balance of
the Class M-4 Certificates immediately prior to such Distribution Date over (y)
the lesser of (A) the product of (i) 76.50% and (ii) the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the related Due
Period (after giving effect to scheduled payments of principal due during the
related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period) and (B)
the aggregate Stated Principal Balance of the Mortgage Loans as of the last day
of the related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period) minus $5,000,001.
"Class M-5 Certificate": Any one of the Class M-5 Certificates
executed by the Trustee, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit A-10 and
evidencing a Regular Interest in REMIC III for purposes of the REMIC Provisions.
"Class M-5 Principal Distribution Amount": With respect to any
Distribution Date, an amount, not less than zero, equal to the lesser of (I) the
Certificate Principal Balance of the Class M-5 Certificates immediately prior to
such Distribution Date and (II) the excess of (x) the sum of (i) the aggregate
Certificate Principal Balance of the Class A Certificates (after taking into
account the payment of the Class A Principal Distribution Amount on such
Distribution Date), (ii) the Certificate Principal Balance of the Class M-1
Certificates (after taking into account the payment of the Class M-1 Principal
Distribution Amount on such Distribution Date), (iii) the Certificate Principal
Balance of the Class M-2 Certificates (after taking into account the payment of
the Class M-2 Principal Distribution Amount on such Distribution Date), (iv) the
Certificate Principal Balance of the Class M-3 Certificates (after taking into
account the payment of the Class M-3 Principal Distribution Amount on such
Distribution Date), (v) the Certificate Principal Balance of the Class M-4
Certificates (after taking into account the payment of the Class M-4 Principal
Distribution Amount on such Distribution Date) and (vi) the Certificate
Principal Balance of the Class M-5 Certificates immediately prior to such
Distribution Date over (y) the lesser of (A) the product of (i) 82.10% and (ii)
the aggregate Stated Principal Balance of the Mortgage Loans as of the last day
of the related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period) and (B) the aggregate Stated Principal Balance of the Mortgage Loans as
of the last day of the related Due Period (after giving effect to scheduled
payments of principal due during the related Due Period, to the extent received
or advanced, and unscheduled collections of principal received during the
related Prepayment Period) minus $5,000,001.
15
"Class M-6 Certificate": Any one of the Class M-6 Certificates
executed by the Trustee, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit A-11 and
evidencing a Regular Interest in REMIC II for purposes of the REMIC Provisions.
"Class M-6 Principal Distribution Amount": With respect to any
Distribution Date, an amount, not less than zero, equal to the lesser of (I) the
Certificate Principal Balance of the Class M-6 Certificates immediately prior to
such Distribution Date and (II) the excess of (x) the sum of (i) the aggregate
Certificate Principal Balance of the Class A Certificates (after taking into
account the payment of the Class A Principal Distribution Amount on such
Distribution Date), (ii) the Certificate Principal Balance of the Class M-1
Certificates (after taking into account the payment of the Class M-1 Principal
Distribution Amount on such Distribution Date), (iii) the Certificate Principal
Balance of the Class M-2 Certificates (after taking into account the payment of
the Class M-2 Principal Distribution Amount on such Distribution Date), (iv) the
Certificate Principal Balance of the Class M-3 Certificates (after taking into
account the payment of the Class M-3 Principal Distribution Amount on such
Distribution Date), (v) the Certificate Principal Balance of the Class M-4
Certificates (after taking into account the payment of the Class M-4 Principal
Distribution Amount on such Distribution Date), (vi) the Certificate Principal
Balance of the Class M-5 Certificates (after taking into account the payment of
the Class M-5 Principal Distribution Amount on such Distribution Date) and (vii)
the Certificate Principal Balance of the Class M-6 Certificates immediately
prior to such Distribution Date over (y) the lesser of (A) the product of (i)
84.60% and (ii) the aggregate Stated Principal Balance of the Mortgage Loans as
of the last day of the related Due Period (after giving effect to scheduled
payments of principal due during the related Due Period, to the extent received
or advanced, and unscheduled collections of principal received during the
related Prepayment Period) and (B) the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Due Period (after giving effect
to scheduled payments of principal due during the related Due Period, to the
extent received or advanced, and unscheduled collections of principal received
during the related Prepayment Period) minus $5,000,001.
"Class M-7 Certificate": Any one of the Class M-7 Certificates
executed by the Trustee, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit A-12 and
evidencing a Regular Interest in REMIC III for purposes of the REMIC Provisions.
"Class M-7 Principal Distribution Amount": With respect to any
Distribution Date, an amount, not less than zero, equal to the lesser of (I) the
Certificate Principal Balance of the Class M-7 Certificates immediately prior to
such Distribution Date and (II) the excess of (x) the sum of (i) the aggregate
Certificate Principal Balance of the Class A Certificates (after taking into
account the payment of the Class A Principal Distribution Amount on such
Distribution Date), (ii) the Certificate Principal Balance of the Class M-1
Certificates (after taking into account the payment of the Class M-1 Principal
Distribution Amount on such Distribution Date), (iii) the Certificate Principal
Balance of the Class M-2 Certificates (after taking into account the payment of
the Class M-2 Principal Distribution Amount on such Distribution Date), (iv) the
Certificate Principal Balance of the Class M-3 Certificates (after taking into
account the payment of the Class M-3 Principal Distribution Amount on such
Distribution Date), (v) the Certificate Principal Balance of the Class M-4
Certificates (after taking into account the payment of the Class M-4 Principal
Distribution
16
Amount on such Distribution Date), (vi) the Certificate Principal Balance of the
Class M-5 Certificates (after taking into account the payment of the Class M-5
Principal Distribution Amount on such Distribution Date), (vii) the Certificate
Principal Balance of the Class M-6 Certificates (after taking into account the
payment of the Class M-6 Principal Distribution Amount on such Distribution
Date) and (viii) the Certificate Principal Balance of the Class M-7 Certificates
immediately prior to such Distribution Date over (y) the lesser of (A) the
product of (i) 86.80% and (ii) the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Due Period (after giving effect
to scheduled payments of principal due during the related Due Period, to the
extent received or advanced, and unscheduled collections of principal received
during the related Prepayment Period) and (B) the aggregate Stated Principal
Balance of the Mortgage Loans as of the last day of the related Due Period
(after giving effect to scheduled payments of principal due during the related
Due Period, to the extent received or advanced, and unscheduled collections of
principal received during the related Prepayment Period) minus $5,000,001.
"Class M-8 Certificate": Any one of the Class M-8 Certificates
executed by the Trustee, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit A-13 and
evidencing a Regular Interest in REMIC III for purposes of the REMIC Provisions.
"Class M-8 Principal Distribution Amount": With respect to any
Distribution Date, an amount, not less than zero, equal to the lesser of (I) the
Certificate Principal Balance of the Class M-8 Certificates immediately prior to
such Distribution Date and (II) the excess of (x) the sum of (i) the aggregate
Certificate Principal Balance of the Class A Certificates (after taking into
account the payment of the Class A Principal Distribution Amount on such
Distribution Date), (ii) the Certificate Principal Balance of the Class M-1
Certificates (after taking into account the payment of the Class M-1 Principal
Distribution Amount on such Distribution Date), (iii) the Certificate Principal
Balance of the Class M-2 Certificates (after taking into account the payment of
the Class M-2 Principal Distribution Amount on such Distribution Date), (iv) the
Certificate Principal Balance of the Class M-3 Certificates (after taking into
account the payment of the Class M-3 Principal Distribution Amount on such
Distribution Date), (v) the Certificate Principal Balance of the Class M-4
Certificates (after taking into account the payment of the Class M-4 Principal
Distribution Amount on such Distribution Date), (vi) the Certificate Principal
Balance of the Class M-5 Certificates (after taking into account the payment of
the Class M-5 Principal Distribution Amount on such Distribution Date), (vii)
the Certificate Principal Balance of the Class M-6 Certificates (after taking
into account the payment of the Class M-6 Principal Distribution Amount on such
Distribution Date), (viii) the Certificate Principal Balance of the Class M-7
Certificates (after taking into account the payment of the Class M-7 Principal
Distribution Amount on such Distribution Date) and (ix) the Certificate
Principal Balance of the Class M-8 Certificates immediately prior to such
Distribution Date over (y) the lesser of (A) the product of (i) 88.80% and (ii)
the aggregate Stated Principal Balance of the Mortgage Loans as of the last day
of the related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period) and (B) the aggregate Stated Principal Balance of the Mortgage Loans as
of the last day of the related Due Period (after giving effect to scheduled
payments of principal due during the related Due Period, to the extent received
or advanced, and unscheduled collections of principal received during the
related Prepayment Period) minus $5,000,001.
17
"Class M-9 Certificate": Any one of the Class M-9 Certificates
executed by the Trustee, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit A-14 and
evidencing a Regular Interest in REMIC III for purposes of the REMIC Provisions.
"Class M-9 Principal Distribution Amount": With respect to any
Distribution Date, an amount, not less than zero, equal to the lesser of (I) the
Certificate Principal Balance of the Class M-9 Certificates immediately prior to
such Distribution Date and (II) the excess of (x) the sum of (i) the aggregate
Certificate Principal Balance of the Class A Certificates (after taking into
account the payment of the Class A Principal Distribution Amount on such
Distribution Date), (ii) the Certificate Principal Balance of the Class M-1
Certificates (after taking into account the payment of the Class M-1 Principal
Distribution Amount on such Distribution Date), (iii) the Certificate Principal
Balance of the Class M-2 Certificates (after taking into account the payment of
the Class M-2 Principal Distribution Amount on such Distribution Date), (iv) the
Certificate Principal Balance of the Class M-3 Certificates (after taking into
account the payment of the Class M-3 Principal Distribution Amount on such
Distribution Date), (v) the Certificate Principal Balance of the Class M-4
Certificates (after taking into account the payment of the Class M-4 Principal
Distribution Amount on such Distribution Date), (vi) the Certificate Principal
Balance of the Class M-5 Certificates (after taking into account the payment of
the Class M-5 Principal Distribution Amount on such Distribution Date), (vii)
the Certificate Principal Balance of the Class M-6 Certificates (after taking
into account the payment of the Class M-6 Principal Distribution Amount on such
Distribution Date), (viii) the Certificate Principal Balance of the Class M-7
Certificates (after taking into account the payment of the Class M-7 Principal
Distribution Amount on such Distribution Date), (ix) the Certificate Principal
Balance of the Class M-8 Certificates (after taking into account the payment of
the Class M-8 Principal Distribution Amount on such Distribution Date) and (x)
the Certificate Principal Balance of the Class M-9 Certificates immediately
prior to such Distribution Date over (y) the lesser of (A) the product of (i)
91.20% and (ii) the aggregate Stated Principal Balance of the Mortgage Loans as
of the last day of the related Due Period (after giving effect to scheduled
payments of principal due during the related Due Period, to the extent received
or advanced, and unscheduled collections of principal received during the
related Prepayment Period) and (B) the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Due Period (after giving effect
to scheduled payments of principal due during the related Due Period, to the
extent received or advanced, and unscheduled collections of principal received
during the related Prepayment Period) minus $5,000,001.
"Class M-10 Certificate": Any one of the Class M-10 Certificates
executed by the Trustee, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit A-15 and
evidencing a Regular Interest in REMIC III for purposes of the REMIC Provisions.
"Class M-10 Principal Distribution Amount": With respect to any
Distribution Date, an amount, not less than zero, equal to the lesser of (I) the
Certificate Principal Balance of the Class M-10 Certificates immediately prior
to such Distribution Date and (II) the excess of (x) the sum of (i) the
aggregate Certificate Principal Balance of the Class A Certificates (after
taking into account the payment of the Class A Principal Distribution Amount on
such Distribution Date), (ii) the Certificate Principal Balance of the Class M-1
Certificates (after taking into account the payment of
18
the Class M-1 Principal Distribution Amount on such Distribution Date), (iii)
the Certificate Principal Balance of the Class M-2 Certificates (after taking
into account the payment of the Class M-2 Principal Distribution Amount on such
Distribution Date), (iv) the Certificate Principal Balance of the Class M-3
Certificates (after taking into account the payment of the Class M-3 Principal
Distribution Amount on such Distribution Date), (v) the Certificate Principal
Balance of the Class M-4 Certificates (after taking into account the payment of
the Class M-4 Principal Distribution Amount on such Distribution Date), (vi) the
Certificate Principal Balance of the Class M-5 Certificates (after taking into
account the payment of the Class M-5 Principal Distribution Amount on such
Distribution Date), (vii) the Certificate Principal Balance of the Class M-6
Certificates (after taking into account the payment of the Class M-6 Principal
Distribution Amount on such Distribution Date), (viii) the Certificate Principal
Balance of the Class M-7 Certificates (after taking into account the payment of
the Class M-7 Principal Distribution Amount on such Distribution Date), (ix) the
Certificate Principal Balance of the Class M-8 Certificates (after taking into
account the payment of the Class M-8 Principal Distribution Amount on such
Distribution Date), (x) the Certificate Principal Balance of the Class M-9
Certificates (after taking into account the payment of the Class M-9 Principal
Distribution Amount on such Distribution Date) and (x) the Certificate Principal
Balance of the Class M-10 Certificates immediately prior to such Distribution
Date over (y) the lesser of (A) the product of (i) 94.10% and (ii) the aggregate
Stated Principal Balance of the Mortgage Loans as of the last day of the related
Due Period (after giving effect to scheduled payments of principal due during
the related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period) and (B)
the aggregate Stated Principal Balance of the Mortgage Loans as of the last day
of the related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period) minus $5,000,001.
"Class P Certificate": Any one of the Class P Certificates executed,
authenticated and delivered by the Trustee, substantially in the form annexed
hereto as Exhibit A-17 and evidencing a Regular Interest in REMIC V for purposes
of the REMIC Provisions.
"Class P Interest": An uncertificated interest in the Trust Fund
held by the Trustee on behalf of the Holders of the Class P Certificates,
evidencing a Regular Interest in REMIC III for purposes of the REMIC Provisions.
"Class R Certificate": Any one of the Class R Certificates executed,
authenticated and delivered by the Trustee, substantially in the form annexed
hereto as Exhibit A-18 and evidencing the ownership of the Class R-I Interest,
the Class R-II Interest and the Class R-III Interest.
"Class R-X Certificate": Any one of the Class R-X Certificates
executed, authenticated and delivered by the Trustee, substantially in the form
annexed hereto as Exhibit A-19 and evidencing the ownership of the Class R-III
Interest and the Class R-IV Interest.
"Class R-I Interest": The uncertificated Residual Interest in REMIC
I.
"Class R-II Interest": The uncertificated Residual Interest in REMIC
II.
19
"Class R-III Interest": The uncertificated Residual Interest in
REMIC III.
"Class R-IV Interest": The uncertificated Residual Interest in REMIC
IV.
"Class R-V Interest": The uncertificated Residual Interest in REMIC
V.
"Closing Date": May 4, 2004.
"Code": The Internal Revenue Code of 1986, as amended.
"Collection Account": The account or accounts created and maintained
by the Master Servicer pursuant to Section 3.04(a), which shall be entitled
"Ameriquest Mortgage Company, as Master Servicer for Deutsche Bank National
Trust Company, as Trustee, in trust for the registered holders of Argent
Securities Inc., Asset-Backed Pass-Through Certificates, Series 2004-W7." The
Collection Account must be an Eligible Account.
"Commission": The Securities and Exchange Commission.
"Compensating Interest": As defined in Section 4.03(e) hereof.
"Corporate Trust Office": The principal corporate trust office of
the Trustee at which at any particular time its corporate trust business in
connection with this Agreement shall be administered, which office at the date
of the execution of this instrument is located at 0000 Xxxx Xx. Xxxxxx Xxxxx,
Xxxxx Xxx, XX 00000-0000, or at such other address as the Trustee may designate
from time to time by notice to the Certificateholders, the Depositor and the
Master Servicer.
"Corresponding Certificate": With respect to each REMIC II Regular
Interest, as follows:
REMIC II Regular Interest Class
------------------------- -----
REMIC II Regular Interest II-LTA1 A-1
REMIC II Regular Interest II-LTA2 A-2
REMIC II Regular Interest II-LTA3 A-3
REMIC II Regular Interest II-LTA4 A-4
REMIC II Regular Interest II-LTA5 A-5
REMIC II Regular Interest II-LTM1 M-1
REMIC II Regular Interest II-LTM2 M-2
REMIC II Regular Interest II-LTM3 M-3
REMIC II Regular Interest II-LTM4 M-4
REMIC II Regular Interest II-LTM5 M-5
REMIC II Regular Interest II-LTM6 M-6
REMIC II Regular Interest II-LTM7 M-7
REMIC II Regular Interest II-LTM8 M-8
REMIC II Regular Interest II-LTM9 M-9
REMIC II Regular Interest II-LTM10 M-10
REMIC II Regular Interest II-LTP P
20
"Credit Enhancement Percentage": For any Distribution Date and Class
of Offered Certificates will be, the percentage equivalent of a fraction,
calculated after taking into account distribution of the Group I Principal
Distribution Amount and the Group II Principal Distribution Amount to the
Certificates then entitled to distributions of principal on such Distribution
Date, the numerator of which is the sum of the aggregate Certificate Principal
Balances of the Classes of Certificates with a lower distribution priority than
such Class and the denominator of which is the sum of (i) the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the related Due
Period and (ii) the amount on deposit in the Pre-Funding Accounts, exclusive of
investment earnings therein, (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period).
"Cumulative Loss Percentage": With respect to any Distribution Date,
the percentage equivalent of a fraction, the numerator of which is the aggregate
amount of Realized Losses incurred from the Cut-off Date to the last day of the
preceding calendar month (reduced by the aggregate amount of Subsequent
Recoveries received from the Cut-off Date through the last day of the related
Due Period) and the denominator of which is the sum of (i) the aggregate Stated
Principal Balance of the Initial Mortgage Loans as of the Cut-off Date and (ii)
the Original Pre-Funded Amounts.
"Custodian": A Custodian, which shall initially be Deutsche Bank
National Trust Company.
"Cut-off Date": With respect to any Initial Mortgage Loan, the close
of business on May 1, 2004. With respect to any Subsequent Mortgage Loan, the
first day of the month in which the related Subsequent Transfer Date occurs.
With respect to all Qualified Substitute Mortgage Loans, their respective dates
of substitution. References herein to the "Cut-off Date," when used with respect
to more than one Mortgage Loan, shall be to the respective Cut-off Dates for
such Mortgage Loans.
"Debt Service Reduction": With respect to any Mortgage Loan, a
reduction in the scheduled Monthly Payment for such Mortgage Loan by a court of
competent jurisdiction in a proceeding under the Bankruptcy Code, except such a
reduction resulting from a Deficient Valuation.
"Deficient Valuation": With respect to any Mortgage Loan, a
valuation of the related Mortgaged Property by a court of competent jurisdiction
in an amount less than the then outstanding Stated Principal Balance of the
Mortgage Loan, which valuation results from a proceeding initiated under the
Bankruptcy Code.
"Definitive Certificates": As defined in Section 5.01(b).
"Deleted Mortgage Loan": A Mortgage Loan replaced or to be replaced
by a Qualified Substitute Mortgage Loan.
"Delinquency Percentage": With respect to any Distribution Date, the
percentage equivalent of a fraction, the numerator of which is the aggregate
Stated Principal Balance of all
21
Mortgage Loans as of the last day of the previous calendar month that, as of
such last day of the previous calendar month, are 60 or more days delinquent
(measured under the Office of Thrift Supervision ("OTS ") delinquency
calculation methodology), are in foreclosure, have been converted to REO
Properties or have been discharged by reason of bankruptcy, and the denominator
of which is the sum of (i) the aggregate Stated Principal Balance of the
Mortgage Loans and REO Properties as of the last day of the previous calendar
month and (ii) any amounts remaining on deposit in the Pre-Funding Accounts;
provided, however, that any Mortgage Loan purchased by the Master Servicer or
the NIMS Insurer pursuant to Section 3.16 shall not be included in either the
numerator or the denominator for purposes of calculating the Delinquency
Percentage.
"Depositor": Argent Securities Inc., a Delaware corporation, or its
successor in interest.
"Depository": The Depository Trust Company, or any successor
Depository hereafter named. The nominee of the initial Depository, for purposes
of registering those Certificates that are to be Book-Entry Certificates, is
CEDE & Co. The Depository shall at all times be a "clearing corporation" as
defined in Section 8-102(3) of the Uniform Commercial Code of the State of New
York and a "clearing agency" registered pursuant to the provisions of Section
17A of the Securities Exchange Act of 1934, as amended.
"Depository Institution": Any depository institution or trust
company, including the Trustee, that (a) is incorporated under the laws of the
United States of America or any State thereof, (b) is subject to supervision and
examination by federal or state banking authorities and (c) has outstanding
unsecured commercial paper or other short-term unsecured debt obligations that
are rated P-1 by Xxxxx'x, F-1 by Fitch and A-1 by S&P (or comparable ratings if
Xxxxx'x, Fitch and S&P are not the Rating Agencies).
"Depository Participant": A broker, dealer, bank or other financial
institution or other Person for whom from time to time a Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
"Determination Date": With respect to each Distribution Date, the
10th day of the calendar month in which such Distribution Date occurs or, if
such 10th day is not a Business Day, the Business Day immediately preceding such
10th day.
"Directly Operate": With respect to any REO Property, the furnishing
or rendering of services to the tenants thereof, the management or operation of
such REO Property, the holding of such REO Property primarily for sale to
customers, the performance of any construction work thereon or any use of such
REO Property in a trade or business conducted by REMIC I other than through an
Independent Contractor; provided, however, that the Trustee (or the Master
Servicer on behalf of the Trustee) shall not be considered to Directly Operate
an REO Property solely because the Trustee (or the Master Servicer on behalf of
the Trustee) establishes rental terms, chooses tenants, enters into or renews
leases, deals with taxes and insurance, or makes decisions as to repairs or
capital expenditures with respect to such REO Property.
22
"Disqualified Organization": Any of the following: (i) the United
States, any State or political subdivision thereof, any possession of the United
States, or any agency or instrumentality of any of the foregoing (other than an
instrumentality which is a corporation if all of its activities are subject to
tax and, except for Xxxxxxx Mac, a majority of its board of directors is not
selected by such governmental unit), (ii) any foreign government, any
international organization, or any agency or instrumentality of any of the
foregoing, (iii) any organization (other than certain farmers' cooperatives
described in Section 521 of the Code) which is exempt from the tax imposed by
Chapter 1 of the Code (including the tax imposed by Section 511 of the Code on
unrelated business taxable income), (iv) rural electric and telephone
cooperatives described in Section 1381(a)(2)(C) of the Code, (v) an "electing
large partnership" and (vi) any other Person so designated by the Trustee based
upon an Opinion of Counsel that the holding of an Ownership Interest in a
Residual Certificate by such Person may cause any Trust REMIC or any Person
having an Ownership Interest in any Class of Certificates (other than such
Person) to incur a liability for any federal tax imposed under the Code that
would not otherwise be imposed but for the Transfer of an Ownership Interest in
a Residual Certificate to such Person. The terms "United States," "State" and
"international organization" shall have the meanings set forth in Section 7701
of the Code or successor provisions.
"Distribution Account": The trust account or accounts created and
maintained by the Trustee pursuant to Section 3.04(e) which shall be entitled
"Deutsche Bank National Trust Company, as Trustee, in trust for the registered
holders of Argent Securities Inc., Asset-Backed Pass-Through Certificates,
Series 2004-W7." The Distribution Account must be an Eligible Account.
"Distribution Date": The 25th day of any month, or if such 25th day
is not a Business Day, the next succeeding Business Day, commencing in June
2004.
"Due Date": With respect to each Distribution Date, the first day of
the calendar month in which such Distribution Date occurs, which is the day of
the month on which the Monthly Payment is due on a Mortgage Loan, exclusive of
any days of grace.
"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 related Due Date.
"Eligible Account": Any of (i) an account or accounts maintained
with a Depository Institution or trust company the short-term unsecured debt
obligations of which are rated P-1 by Xxxxx'x, F-1 by Fitch and A-1+ by S&P (or
comparable ratings if Xxxxx'x, Fitch and S&P are not the Rating Agencies) at the
time any amounts are held on deposit therein, (ii) an account or accounts the
deposits in which are fully insured by the FDIC or (iii) a trust account or
accounts maintained with the corporate trust department of a federal or state
chartered depository institution or trust company acting in its fiduciary
capacity. Eligible Accounts may bear interest.
"ERISA": The Employee Retirement Income Security Act of 1974, as
amended.
"Escrow Account": The account or accounts created and maintained
pursuant to Section 3.04(c).
23
"Escrow Payments": The amounts constituting taxes, and/or fire and
hazard insurance premiums escrowed by the Mortgagor with the mortgagee pursuant
to a voluntary escrow agreement related to any Mortgage Loan.
"Estate in Real Property": A fee simple estate or leasehold estate
in a parcel of land.
"Excess Overcollateralized Amount": With respect to the Class A
Certificates and the Mezzanine Certificates and any Distribution Date, the
excess, if any, of (i) the Overcollateralized Amount for such Distribution Date
(calculated for this purpose only after assuming that 100% of the Principal
Remittance Amount on such Distribution Date has been distributed) over (ii) the
Overcollateralization Target Amount for such Distribution Date.
"Expense Adjusted Net Mortgage Rate": With respect to any Mortgage
Loan (or the related REO Property), as of any date of determination, a per annum
rate of interest equal to the applicable Mortgage Rate thereon as of the first
day of the month preceding the month in which the Distribution Date occurs minus
the sum of (i) the Trustee Fee Rate and (ii) the Servicing Fee Rate.
"Expense Adjusted Net Maximum Mortgage Rate": With respect to any
Mortgage Loan (or the related REO Property), as of any date of determination, a
per annum rate of interest equal to the applicable Maximum Mortgage Rate (or the
Mortgage Rate for such Mortgage Loan in the case of any Fixed-Rate Mortgage
Loan) as of the first day of the month preceding the month in which the
Distribution Date occurs minus the sum of (i) the Trustee Fee Rate and (ii) the
Servicing Fee Rate.
"Extraordinary Trust Fund Expense": Any amounts reimbursable to the
Trustee, or any director, officer, employee or agent of the Trustee, from the
Trust Fund pursuant to Section 8.05, any amounts payable from the Distribution
Account in respect of taxes pursuant to Section 10.01(g)(iii) and any amounts
payable by the Trustee for the recording of the assignments of mortgage pursuant
to Section 2.01.
"Xxxxxx Mae": Xxxxxx Xxx, formally known as the Federal National
Mortgage Association, or any successor thereto.
"FDIC": Federal Deposit Insurance Corporation or any successor
thereto.
"Final Recovery Determination": With respect to any defaulted
Mortgage Loan or any REO Property (other than a Mortgage Loan or REO Property
purchased by the Seller, the Depositor or the Master Servicer pursuant to or as
contemplated by Section 2.03, Section 3.16(a) or Section 9.01), a determination
made by the Master Servicer that all Insurance Proceeds, Liquidation Proceeds
and other payments or recoveries which the Master Servicer, in its reasonable
good faith judgment, expects to be finally recoverable in respect thereof have
been so recovered. The Master Servicer shall maintain records, prepared by a
Servicing Officer, of each Final Recovery Determination made thereby.
"Fitch": Fitch Ratings, or its successor in interest.
24
"Fixed-Rate Mortgage Loan": Each of the Mortgage Loans identified on
the Mortgage Loan Schedule as having a fixed Mortgage Rate.
"Formula Rate": For any Distribution Date and each Class of
Adjustable-Rate Certificates, the lesser of (i) LIBOR plus the related
Certificate Margin and (ii) the Maximum Cap Rate.
"Xxxxxxx Mac": Xxxxxxx Mac, formally known as the Federal Home Loan
Mortgage Corporation, or any successor thereto.
"Funding Period": The period beginning on the Closing Date and
ending on the earlier of the date on which (a) the amount on deposit in the
Pre-Funding Accounts is reduced to zero or (b) 2:00 p.m., New York City time, on
August 2, 2004.
"Gross Margin": With respect to the Adjustable-Rate Mortgage Loans,
the fixed percentage set forth in the related Mortgage Note that is added to the
Index on each Adjustment Date in accordance with the terms of the related
Mortgage Note to determine the Mortgage Rate for such Adjustable-Rate Mortgage
Loan, as applicable.
"Group I Allocation Percentage": With respect to the Group I
Certificates and any Distribution Date, the percentage equivalent of a fraction,
the numerator of which is (x) the Group I Principal Remittance Amount for such
Distribution Date and the denominator of which is (y) the Principal Remittance
Amount for such Distribution Date.
"Group I Certificates": The Class A-1 Certificates and the Class A-2
Certificates.
"Group I Interest Remittance Amount": With respect to any
Distribution Date, that portion of the Available Funds for such Distribution
Date that represents interest received or advanced on the Group I Mortgage
Loans.
"Group I Mortgage Loan": A Mortgage Loan assigned to Loan Group I;
all Group I Mortgage Loans have a principal balance at origination that conforms
to Xxxxxxx Mac and Xxxxxx Mae loan limits.
"Group I Pre-Funding Account": The account established and
maintained pursuant to Section 4.07.
"Group I Principal Distribution Amount": With respect to any
Distribution Date, the sum of (i) the principal portion of each Monthly Payment
on the Group I Mortgage Loans due during the related Due Period, to the extent
received or advanced prior to the related Determination Date; (ii) the Stated
Principal Balance of any Group I Mortgage Loan that was purchased during the
related Prepayment Period pursuant to or as contemplated by Section 2.03,
Section 3.16(a) or Section 9.01 and the amount of any shortfall deposited in the
Collection Account in connection with the substitution of a Deleted Mortgage
Loan in Loan Group I pursuant to Section 2.03 during the related Prepayment
Period; (iii) the principal portion of all other unscheduled collections
(including, without limitation, Principal Prepayments, Subsequent Recoveries,
Insurance Proceeds, Liquidation Proceeds
25
and REO Principal Amortization) received during the related Prepayment Period on
the Group I Mortgage Loans, net of any portion thereof that represents a
recovery of principal for which an advance was made by the Master Servicer
pursuant to Section 4.03 in respect of a preceding Distribution Date; (iv) with
respect to the Distribution Date immediately following the end of the Funding
Period, any amounts remaining in the Group I Pre-Funding Account after giving
effect to the purchase of any Subsequent Group I Mortgage Loans and (v) the
Group I Allocation Percentage of the amount of any Overcollateralization
Increase Amount for such Distribution Date minus (vi) the Group I Allocation
Percentage of the amount of any Overcollateralization Reduction Amount for such
Distribution Date.
"Group I Principal Remittance Amount": With respect to any
Distribution Date, the sum of the amounts described in clauses (i) through (iv)
of the definition of Group I Principal Distribution Amount.
"Group II Allocation Percentage": With respect to the Group II
Certificates and any Distribution Date, the percentage equivalent of a fraction,
the numerator of which is (x) the Group II Principal Remittance Amount for such
Distribution Date and the denominator of which is (y) the Principal Remittance
Amount for such Distribution Date.
"Group II Cap Contract": The cap contract between Deutsche Bank
National Trust Company, as Trustee and the counterparty thereunder, which is for
the benefit of the Holders of the Class A-3 Certificates, the Class A-4
Certificates and the Class A-5 Certificates, a form of which is attached hereto
as Exhibit H.
"Group II Certificates": The Class A-3 Certificates, the Class A-4
Certificates and the Class A-5 Certificates.
"Group II Interest Remittance Amount": With respect to any
Distribution Date, that portion of the Available Funds for such Distribution
Date that represents interest received or advanced on the Group II Mortgage
Loans.
"Group II Mortgage Loan": A Mortgage Loan assigned to Loan Group II
with a principal balance at origination that may or may not conform to Xxxxxxx
Mac and Xxxxxx Mae loan limits.
"Group II Pre-Funding Account": The account established and
maintained pursuant to Section 4.07.
"Group II Principal Distribution Amount": With respect to any
Distribution Date, the sum of (i) the principal portion of each Monthly Payment
on the Group II Mortgage Loans due during the related Due Period, to the extent
received or advanced prior to the related Determination Date; (ii) the Stated
Principal Balance of any Group II Mortgage Loan that was purchased during the
related Prepayment Period pursuant to or as contemplated by Section 2.03,
Section 3.16(a) or Section 9.01 and the amount of any shortfall deposited in the
Collection Account in connection with the substitution of a Deleted Mortgage
Loan in Loan Group II pursuant to Section 2.03 during the related Prepayment
Period; (iii) the principal portion of all other unscheduled collections
(including, without
26
limitation, Principal Prepayments, Subsequent Recoveries, Insurance Proceeds,
Liquidation Proceeds and REO Principal Amortization) received during the related
Prepayment Period on the Group II Mortgage Loans, net of any portion thereof
that represents a recovery of principal for which an advance was made by the
Master Servicer pursuant to Section 4.03 in respect of a preceding Distribution
Date; (iv) with respect to the Distribution Date immediately following the end
of the Funding Period, any amounts remaining in the Group II Pre-Funding Account
after giving effect to the purchase of any Subsequent Group II Mortgage Loans
and (v) the Group II Allocation Percentage of the amount of any
Overcollateralization Increase Amount for such Distribution Date minus (vi) the
Group II Allocation Percentage of the amount of any Overcollateralization
Reduction Amount for such Distribution Date.
"Group II Principal Remittance Amount": With respect to any
Distribution Date, the sum of the amounts described in clauses (i) through (iv)
of the definition of Group II Principal Distribution Amount.
"Highest Priority": As of any date of determination, the Class of
Mezzanine Certificates then outstanding with a Certificate Principal Balance
greater than zero, with the highest priority for payments pursuant to Section
4.01, in the following order of decreasing priority: Class X-0, Xxxxx X-0, Class
M-3, Class M-4, Class M-5, Class M-6, Class M-7, Class M-8, Class M-9 and Class
M-10 Certificates.
"Indenture": An indenture relating to the issuance of notes secured
by all or a portion of the Class CE Certificates, the Class P Certificates, the
Class R Certificates and/or the Class R-X Certificates which may or may not be
guaranteed by the NIMS Insurer.
"Independent": When used with respect to any specified Person, any
such Person who (a) is in fact independent of the Depositor, the Master
Servicer, the Seller and their respective Affiliates, (b) does not have any
direct financial interest in or any material indirect financial interest in the
Depositor, the Seller, the Master Servicer or any Affiliate thereof, and (c) is
not connected with the Depositor, the Seller, the Master Servicer or any
Affiliate thereof as an officer, employee, promoter, underwriter, trustee,
partner, director or Person performing similar functions; provided, however,
that a Person shall not fail to be Independent of the Depositor, the Seller, the
Master Servicer or any Affiliate thereof merely because such Person is the
beneficial owner of 1% or less of any class of securities issued by the
Depositor or the Master Servicer or any Affiliate thereof, as the case may be.
"Independent Contractor": Either (i) any Person (other than the
Master Servicer) that would be an "independent contractor" with respect to REMIC
I within the meaning of Section 856(d)(3) of the Code if such REMIC were a real
estate investment trust (except that the ownership tests set forth in that
section shall be considered to be met by any Person that owns, directly or
indirectly, 35% or more of any Class of Certificates), so long as such REMIC
does not receive or derive any income from such Person and provided that the
relationship between such Person and such REMIC is at arm's length, all within
the meaning of Treasury Regulation Section 1.856-4(b)(5), or (ii) any other
Person (including the Master Servicer) if the Trustee has received an Opinion of
Counsel to the effect that the taking of any action in respect of any REO
Property by such Person, subject to any conditions therein specified, that is
otherwise herein contemplated to be taken by an
27
Independent Contractor shall not cause such REO Property to cease to qualify as
"foreclosure property" within the meaning of Section 860G(a)(8) of the Code
(determined without regard to the exception applicable for purposes of Section
860D(a) of the Code), or cause any income realized in respect of such REO
Property to fail to qualify as Rents from Real Property.
"Index": With respect to each Adjustable-Rate Mortgage Loan and each
related Adjustment Date, the average of the interbank offered rates for
six-month United States dollar deposits in the London market as published in The
Wall Street Journal and as most recently available as of the first business day
45 days or more prior to such Adjustment Date, as specified in the related
Mortgage Note.
"Insurance Proceeds": Proceeds of any title policy, hazard policy or
other insurance policy covering a Mortgage Loan, to the extent such proceeds are
not to be applied to the restoration of the related Mortgaged Property or
released to the Mortgagor in accordance with the procedures that the Master
Servicer would follow in servicing mortgage loans held for its own account,
subject to the terms and conditions of the related Mortgage Note and Mortgage.
"Interest Accrual Period": With respect to any Distribution Date and
the Adjustable- Rate Certificates, the period commencing on the Distribution
Date in the month immediately preceding the month in which such Distribution
Date occurs (or, in the case of the first Distribution Date, commencing on the
Closing Date) and ending on the day preceding such Distribution Date. With
respect to any Distribution Date and the Class CE Certificates, the REMIC I
Regular Interests and the REMIC II Regular Interests, the one-month period
ending on the last day of the calendar month preceding the month in which such
Distribution Date occurs.
"Interest Carry Forward Amount": With respect to any Distribution
Date and any Class of Class A Certificates or Mezzanine Certificates, the sum of
(i) the amount, if any, by which (a) the Interest Distribution Amount for such
Class of Certificates as of the immediately preceding Distribution Date exceeded
(b) the actual amount distributed on such Class of Certificates in respect of
interest on such immediately preceding Distribution Date and (ii) the amount of
any Interest Carry Forward Amount for such Class of Certificates remaining
unpaid from the previous Distribution Date, plus accrued interest thereon,
calculated at the related Pass-Through Rate for the most recently ended Interest
Accrual Period.
"Interest Coverage Account": The account established and maintained
pursuant to Section 4.08, which account contains an amount, to be paid by the
Depositor to the Trustee on the Closing Date, equals $3,271,937.49.
"Interest Determination Date": With respect to the Adjustable-Rate
Certificates, and solely for purposes of calculating the Marker Rate, REMIC II
Regular Interest I-LTA1, REMIC II Regular Interest III-LTA2, REMIC II Regular
Interest II-LTA3, REMIC II Regular Interest II-LTA4, REMIC II Regular Interest
II-LTA5, REMIC II Regular Interest II-LTM1, REMIC II Regular Interest II-LTM2,
REMIC II Regular Interest II-LTM3, REMIC II Regular Interest II-LTM4, REMIC II
Regular Interest II-LTM5, REMIC II Regular Interest II-LTM6, REMIC II Regular
Interest II-LTM7, REMIC II Regular Interest II-LTM8, REMIC II Regular Interest
II-LTM9 and REMIC II Regular
28
Interest II-LTM10 and any Interest Accrual Period therefor, the second London
Business Day preceding the commencement of such Interest Accrual Period.
"Interest Distribution Amount": With respect to any Distribution
Date and any Class of Class A Certificates, any Class of Mezzanine Certificates
and any Class CE Certificate, the aggregate Accrued Certificate Interest on the
Certificates of such Class for such Distribution Date.
"Late Collections": With respect to any Mortgage Loan and any Due
Period, all amounts received subsequent to the Determination Date immediately
following such Due Period, whether as late payments of Monthly Payments or as
Insurance Proceeds, Liquidation Proceeds, Subsequent Recoveries or otherwise,
which represent late payments or collections of principal and/or interest due
(without regard to any acceleration of payments under the related Mortgage and
Mortgage Note) but delinquent for such Due Period and not previously recovered.
"Liquidation Event": With respect to any Mortgage Loan, any of the
following events: (i) such Mortgage Loan is paid in full; (ii) a Final Recovery
Determination is made as to such Mortgage Loan; or (iii) such Mortgage Loan is
removed from REMIC I by reason of its being purchased, sold or replaced pursuant
to or as contemplated by Section 2.03, Section 3.16(a) or Section 9.01. With
respect to any REO Property, either of the following events: (i) a Final
Recovery Determination is made as to such REO Property; or (ii) such REO
Property is removed from REMIC I by reason of its being purchased pursuant to
Section 9.01.
"Liquidation Proceeds": The amount (other than Insurance Proceeds or
amounts received in respect of the rental of any REO Property prior to REO
Disposition) received by the Master Servicer in connection with (i) the taking
of all or a part of a Mortgaged Property by exercise of the power of eminent
domain or condemnation, (ii) the liquidation of a defaulted Mortgage Loan
through a trustee's sale, foreclosure sale or otherwise, or (iii) the
repurchase, substitution or sale of a Mortgage Loan or an REO Property pursuant
to or as contemplated by Section 2.03, Section 3.13, Section 3.16(a) or Section
9.01.
"Loan Group": Loan Group I or Loan Group II, as the context
requires.
"Loan Group I": The group of Mortgage Loans identified in the
Mortgage Loan Schedule as having been assigned to Loan Group I.
"Loan Group II": The group of Mortgage Loans identified in the
Mortgage Loan Schedule as having been assigned to Loan Group II.
"Loan-to-Value Ratio": As of any date of determination, the
fraction, expressed as a percentage, the numerator of which is the Stated
Principal Balance of the related Mortgage Loan at such date and the denominator
of which is the Value of the related Mortgaged Property.
"London Business Day": Any day on which banks in the City of London
are open and conducting transactions in United States dollars.
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"Loss Mitigation Action Plan": The policies and procedures set forth
in Exhibit I hereto relating to the realization on delinquent Mortgage Loans,
which are incorporated by reference into this Agreement shall be deemed a part
hereof.
"Lost Note Affidavit": With respect to any Mortgage Loan as to which
the original Mortgage Note has been permanently lost, misplaced or destroyed and
has not been replaced, an affidavit from the Seller certifying that the original
Mortgage Note has been lost, misplaced or destroyed (together with a copy of the
related Mortgage Note) and indemnifying the Trust Fund against any loss, cost or
liability resulting from the failure to deliver the original Mortgage Note in
the form of Exhibit B hereto.
"Marker Rate": With respect to the Class CE Interest and any
Distribution Date, a per annum rate equal to two (2) times the weighted average
of the REMIC I Remittance Rate for REMIC II Regular Interest II-LTA1, REMIC II
Regular Interest II-LTA2, REMIC II Regular Interest II- LTA3, REMIC II Regular
Interest II-LTA4, REMIC II Regular Interest II-LTA5, REMIC II Regular Interest
II-LTM1, REMIC II Regular Interest II-LTM2, REMIC II Regular Interest II-LTM3,
REMIC II Regular Interest II-LTM4, REMIC II REMIC II Regular Interest II-LTM7,
REMIC II Regular Interest II-LTM8, REMIC II Regular Interest II-LTM9, REMIC II
Regular Interest II-LTM10 and REMIC II Regular Interest II-LTZZ, with the rate
on each such REMIC II Regular Interest (other than REMIC II Regular Interest
II-LTZZ) subject to the lesser of (i) LIBOR plus the related Certificate Margin
and (ii) the related Net WAC Rate for the purpose of this calculation for such
Distribution Date and with the rate on REMIC II Regular Interest II-LTZZ subject
to a cap of zero for the purpose of this calculation: provided, however, that
solely for this purpose, calculations of the REMIC II Remittance Rate and the
related caps with respect to REMIC II Regular Interest II- LTA1, REMIC II
Regular Interest II-LTA2, REMIC II Regular Interest II-LTA3, REMIC II Regular
Interest II-LTA4, REMIC II Regular Interest II-LTA5, REMIC II Regular Interest
II-LTM1, REMIC II Regular Interest II-LTM2, REMIC II Regular Interest II-LTM3,
REMIC II Regular Interest II- LTM4, REMIC II Regular Interest II-LTM5, REMIC II
Regular Interest II-LTM6, REMIC II Regular Interest II-LTM7, REMIC II Regular
Interest II-LTM8, REMIC II Regular Interest II-LTM9 and REMIC II Regular
Interest II-LTM10 shall be multiplied by a fraction, the numerator of which is
the actual number of days in the Interest Accrual Period and the denominator of
which is 30.
"Master Servicer": Ameriquest Mortgage Company or any successor
master servicer appointed as herein provided, in its capacity as Master Servicer
hereunder.
"Master Servicer Event of Default": One or more of the events
described in Section 7.01.
"Master Servicer Prepayment Charge Payment Amount": The amounts
payable by the Master Servicer pursuant to Section 2.03(b) in respect of any
waived (or, with respect to subsequent changes of law, any unenforceable)
Prepayment Charges.
"Master Servicer Remittance Date": With respect to any Distribution
Date, 3:00 p.m. New York time on the last Business Day preceding the related
Distribution Date.
30
"Master Servicer Reporting Date": With respect to any Distribution
Date, 3:00 p.m. New York time on the 18th day of the calendar month in which
such Distribution Date occurs or, if such 18th day is not a Business Day, the
Business Day immediately succeeding such 18th day.
"Master Servicer Termination Test": With respect to any Distribution
Date, the Master Servicer Termination Test will be failed if the Cumulative Loss
Percentage exceeds 4.00%.
"Maximum Cap Rate": For any Distribution Date with respect to the
Class A-1 Certificates, a per annum rate equal to the product of (x) the
weighted average of the Expense Adjusted Net Maximum Mortgage Rates of the Group
I Mortgage Loans, weighted on the basis of the outstanding Stated Principal
Balances of the Group I Mortgage Loans as of the first day of the month
preceding the month in which such Distribution Date occurs (after giving effect
to scheduled payments of principal due during the related Due Period, to the
extent received or advanced, and unscheduled collections of principal received
during the related Prepayment Period) and (y) a fraction, the numerator of which
is 30 and the denominator of which is the actual number of days elapsed in the
related Interest Accrual Period.
For any Distribution Date with respect to the Class A-2
Certificates, a per annum rate equal to the sum of (i) the product of (x) the
weighted average of the Expense Adjusted Net Maximum Mortgage Rates of the Group
I Mortgage Loans, weighted on the basis of the outstanding Stated Principal
Balances of the Group I Mortgage Loans as of the first day of the month
preceding the month in which such Distribution Date occurs (after giving effect
to scheduled payments of principal due during the related Due Period, to the
extent received or advanced, and unscheduled collections of principal received
during the related Prepayment Period) and (y) a fraction, the numerator of which
is 30 and the denominator of which is the actual number of days elapsed in the
related Interest Accrual Period and (ii) the related Cap Contract Excess. If the
Certificate Principal Balance of the Class A-2 Certificates exceeds the
applicable notional balance for such Distribution Date, the Cap Contract Excess
is to be adjusted by multiplying the applicable Cap Contract Excess by a
fraction, the numerator of which is the applicable notional balance for such
Distribution Date and the denominator of which is the Certificate Principal
Balance of the Class A-2 Certificates for such Distribution Date prior to the
distribution of the principal to such Certificates for such Distribution Date.
For any Distribution Date with respect to the Class A-3
Certificates, the Class A-4 Certificates and the Class A-5 Certificates, a per
annum rate equal to the sum of (i) the product of (x) the weighted average of
the Expense Adjusted Net Maximum Mortgage Rates of the Group II Mortgage Loans,
weighted on the basis of the outstanding Stated Principal Balances of the Group
II Mortgage Loans as of the first day of the month preceding the month in which
such Distribution Date occurs (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period) and (y) a fraction, the numerator of which is 30 and the denominator of
which is the actual number of days elapsed in the related Interest Accrual
Period and (ii) the related Cap Contract Excess. If the Certificate Principal
Balance of the applicable Certificates exceeds the applicable notional balance
for such Distribution Date, the Cap Contract Excess is to be adjusted by
multiplying the applicable Cap Contract Excess by a fraction, the numerator of
which is the applicable notional balance for such Distribution Date and the
denominator of which is the
31
aggregate Certificate Principal Balance of the Class A-3 Certificates, the Class
A-4 Certificates and the Class A-5 Certificates for such Distribution Date prior
to the distribution of the principal to such Certificates for such Distribution
Date.
For any Distribution Date with respect to the Mezzanine
Certificates, a per annum rate equal to the sum of (i) the product of (x) the
weighted average, weighted on the basis of the results of subtracting from the
aggregate Stated Principal Balance of each Loan Group the current Certificate
Principal Balance of the related Class A Certificates, of the weighted average
Expense Adjusted Net Maximum Mortgage Rates of (a) the Group I Mortgage Loans
and (b) the Group II Mortgage Loans and (y) a fraction, the numerator of which
is 30 and the denominator of which is the actual number of days elapsed in the
related Interest Accrual Period and (ii) the related Cap Contract Excess. If the
Certificate Principal Balance of the applicable Certificates exceeds the
applicable notional balance for such Distribution Date, the Cap Contract Excess
is to be adjusted by multiplying the applicable Cap Contract Excess by a
fraction, the numerator of which is the applicable notional balance for such
Distribution Date and the denominator of which is the aggregate Certificate
Principal Balance of the Mezzanine Certificates for such Distribution Date prior
to the distribution of the principal to such Certificates for such Distribution
Date.
"Maximum II-LTZZ Uncertificated Interest Deferral Amount": With
respect to any Distribution Date, the excess of (i) accrued interest at the
REMIC II Remittance Rate applicable to REMIC II Regular Interest II-LTZZ for
such Distribution Date on a balance equal to the Uncertificated Balance of REMIC
II Regular Interest II-LTZZ minus the REMIC II Overcollateralization Amount, in
each case for such Distribution Date, over (ii) Uncertificated Interest on REMIC
II Regular Interest II-LTA1, REMIC II Regular Interest II-LTA2, REMIC II Regular
Interest II-LTA3, REMIC II Regular Interest II-LTA4, REMIC II Regular Interest
II-LTA5, REMIC II Regular Interest II-LTM1, REMIC II Regular Interest II-LTM2,
REMIC II Regular Interest II-LTM3, REMIC II Regular Interest II-LTM4, REMIC II
Regular Interest II-LTM5, REMIC II Regular Interest II-LTM6, REMIC II Regular
Interest II-LTM7, REMIC II Regular Interest II-LTM8, REMIC II Regular Interest
II-LTM9 and REMIC II Regular Interest II-LTM10 for such Distribution Date, with
the rate on each such REMIC II Regular Interest subject to a cap equal to the
lesser of (i) LIBOR plus the related Certificate Margin and (ii) the related Net
WAC Rate; provided, however, that solely for this purpose, calculations of the
REMIC II Remittance Rate and the related caps with respect to REMIC II Regular
Interest II-LTA1, REMIC II Regular Interest II-LTA2, REMIC II Regular Interest
II-LTA3, REMIC II Regular Interest II-LTA4, REMIC II Regular Interest II-LTA5,
REMIC II Regular Interest II-LTM1, REMIC II Regular Interest II-LTM2, REMIC II
Regular Interest II-LTM3, REMIC II Regular Interest II-LTM4, REMIC II Regular
Interest II-LTM5, REMIC II Regular Interest II-LTM6, REMIC II Regular Interest
II-LTM7, REMIC II Regular Interest II-LTM8, REMIC II Regular Interest II-LTM9
and REMIC II Regular Interest II-LTM10 shall be multiplied by a fraction, the
numerator of which is the actual number of days in the Interest Accrual Period
and the denominator of which is 30.
"Maximum Mortgage Rate": With respect to the Adjustable-Rate
Mortgage Loans, the percentage set forth in the related Mortgage Note as the
maximum Mortgage Rate thereunder.
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"Mezzanine Cap Contract": The cap contract between Deutsche Bank
National Trust Company, as Trustee and the counterparty thereunder, which is for
the benefit of the Holders of the Mezzanine Certificates, a form of which is
attached hereto as Exhibit H.
"Mezzanine Certificate": Any one of the Class M-1 Certificates, the
Class M-2 Certificates, the Class M-3 Certificates, the Class M-4 Certificates,
the Class M-5 Certificates, the Class M-6 Certificates, the Class M-7
Certificates, the Class M-8 Certificates, the Class M-9 Certificates and the
Class M-10 Certificates.
"Minimum Mortgage Rate": With respect to the Adjustable-Rate
Mortgage Loans, the percentage set forth in the related Mortgage Note as the
minimum Mortgage Rate thereunder.
"Monthly Payment": With respect to any Mortgage Loan, the scheduled
monthly payment of principal and interest on such Mortgage Loan which is payable
by the related Mortgagor from time to time under the related Mortgage Note,
determined: (a) after giving effect to (i) any Deficient Valuation and/or Debt
Service Reduction with respect to such Mortgage Loan and (ii) any reduction in
the amount of interest collectible from the related Mortgagor pursuant to the
Relief Act; (b) without giving effect to any extension granted or agreed to by
the Master Servicer pursuant to Section 3.02; and (c) on the assumption that all
other amounts, if any, due under such Mortgage Loan are paid when due.
"Moody's": Xxxxx'x Investors Service, Inc., or its successor in
interest.
"Mortgage": The mortgage, deed of trust or other instrument creating
a first lien on, or first priority security interest in, a Mortgaged Property
securing a Mortgage Note.
"Mortgage File": The mortgage documents listed in Section 2.01
pertaining to a particular Mortgage Loan and any additional documents required
to be added to the Mortgage File pursuant to this Agreement.
"Mortgage Loan": Each mortgage loan transferred and assigned to the
Trustee pursuant to Section 2.01 or Section 2.03(d) of this Agreement or
pursuant to a Subsequent Transfer Instrument, as held from time to time held as
a part of REMIC I, the Mortgage Loans so held being identified in the Mortgage
Loan Schedule.
"Mortgage Loan Purchase Agreement": The agreement between the Seller
and the Depositor, regarding the transfer of the Mortgage Loans by the Seller to
or at the direction of the Depositor, substantially in the form of Exhibit D
annexed hereto.
"Mortgage Loan Schedule": As of any date, the list of Mortgage Loans
included in REMIC I on such date, separately identifying the Group I Mortgage
Loans and the Group II Mortgage Loans, attached hereto as Schedule 1 and as
supplemented by each schedule of Subsequent Mortgage Loans attached to the
Subsequent Transfer Instrument. The Mortgage Loan Schedule shall set forth the
following information with respect to each Mortgage Loan:
(1) the Seller's Mortgage Loan identifying number;
33
(2) [reserved];
(3) the state and zip code of the Mortgaged Property;
(4) a code indicating whether the Mortgaged Property is
owner-occupied;
(5) the type of Residential Dwelling constituting the Mortgaged
Property;
(6) the original months to maturity;
(7) the Loan-to-Value Ratio at origination;
(8) the Mortgage Rate in effect immediately following the Cut-off
Date (or the related Subsequent Cut-off Date with respect to a Subsequent
Mortgage Loan);
(9) the date on which the first Monthly Payment was due on the
Mortgage Loan;
(10) the stated maturity date;
(11) the amount of the Monthly Payment due on the first Due Date
after the Cut- off Date (or the related Subsequent Cut-off Date with
respect to a Subsequent Mortgage Loan);
(12) the last Due Date on which a Monthly Payment was actually
applied to the unpaid Stated Principal Balance;
(13) the original principal amount of the Mortgage Loan;
(14) the Scheduled Principal Balance of the Mortgage Loan as of the
close of business on the Cut-off Date (or the related Subsequent Cut-off
Date with respect to a Subsequent Mortgage Loan);
(15) with respect to the Adjustable-Rate Mortgage Loans, the Gross
Margin;
(16) a code indicating the purpose of the Mortgage Loan (i.e.,
purchase, refinance debt consolidation cashout, or refinance debt
consolidation no cashout);
(17) with respect to the Adjustable-Rate Mortgage Loans, the Maximum
Mortgage Rate;
(18) with respect to the Adjustable-Rate Mortgage Loans, the Minimum
Mortgage Rate;
(19) the Mortgage Rate at origination;
34
(20) with respect to the Adjustable-Rate Mortgage Loans, the
Periodic Rate Cap and the maximum first Adjustment Date Mortgage Rate
adjustment;
(21) a code indicating the documentation program (i.e., Full
Documentation, Limited Documentation or Stated Income);
(22) with respect to the Adjustable-Rate Mortgage Loans, the first
Adjustment Date immediately following the Cut-off Date (or the related
Subsequent Cut-off Date with respect to a Subsequent Mortgage Loan);
(23) the risk grade;
(24) the Value of the Mortgaged Property;
(25) the sale price of the Mortgaged Property, if applicable; and
(26) the FICO score of the primary Mortgagor.
The Mortgage Loan Schedule shall set forth the following information
with respect to the Mortgage Loans by Loan Group and in the aggregate as of the
Cut-off Date (or the related Subsequent Cut-off Date with respect to a
Subsequent Mortgage Loan): (1) the number of Mortgage Loans; (2) the current
Stated Principal Balance of the Mortgage Loans; (3) the weighted average
Mortgage Rate of the Mortgage Loans; and (4) the weighted average maturity of
the Mortgage Loans. The Mortgage Loan Schedule shall be amended from time to
time by the Depositor in accordance with the provisions of this Agreement. With
respect to any Qualified Substitute Mortgage Loan, the Cut-off Date shall refer
to the related Cut-off Date for such Mortgage Loan, determined in accordance
with the definition of Cut-off Date herein.
"Mortgage Note": The original executed note or other evidence of the
indebtedness of a Mortgagor under a Mortgage Loan.
"Mortgage Pool": The pool of Mortgage Loans, identified on Schedule
1 from time to time, and any REO Properties acquired in respect thereof.
"Mortgage Rate": With respect to each Mortgage Loan, the annual rate
at which interest accrues on such Mortgage Loan from time to time in accordance
with the provisions of the related Mortgage Note, which rate (i) with respect to
the Fixed-Rate Mortgage Loans, shall remain constant at the rate set forth in
the Mortgage Loan Schedule as the Mortgage Rate in effect immediately following
the Cut-off Date (or the related Subsequent Cut-off Date with respect to a
Subsequent Mortgage Loan) and (ii) with respect to the Adjustable-Rate Mortgage
Loans, (A) as of any date of determination until the first Adjustment Date
following the Cut-off Date (or the related Subsequent Cut-off Date with respect
to a Subsequent Mortgage Loan) shall be the rate set forth in the Mortgage Loan
Schedule as the Mortgage Rate in effect immediately following the Cut-off Date
(or the related Subsequent Cut-off Date with respect to a Subsequent Mortgage
Loan) and (B) as of any date of determination thereafter shall be the rate as
adjusted on the most recent Adjustment Date equal to the sum, rounded to the
nearest 0.125% as provided in the Mortgage Note, of the Index, as
35
most recently available as of a date prior to the Adjustment Date as set forth
in the related Mortgage Note, plus the related Gross Margin; provided that the
Mortgage Rate on the Adjustable-Rate Mortgage Loans on any Adjustment Date shall
never be more than the lesser of (i) the sum of the Mortgage Rate in effect
immediately prior to the Adjustment Date plus the related Periodic Rate Cap, if
any, and (ii) the related Maximum Mortgage Rate, and shall never be less than
the greater of (i) the Mortgage Rate in effect immediately prior to the
Adjustment Date less the Periodic Rate Cap, if any, and (ii) the related Minimum
Mortgage Rate. With respect to each Mortgage Loan that becomes an REO Property,
as of any date of determination, the annual rate determined in accordance with
the immediately preceding sentence as of the date such Mortgage Loan became an
REO Property.
"Mortgaged Property": The underlying property identified in the
related Mortgage as securing a Mortgage Loan, including any REO Property,
consisting of an Estate in Real Property improved by a Residential Dwelling
(excluding for purposes of construing the representations or warranties made in
the Mortgage Loan Purchase Agreement, any improvements thereupon not considered
by the appraiser in determining the Value of such Mortgaged Property).
"Mortgagor": The obligor on a Mortgage Note.
"Net Monthly Excess Cashflow": With respect to any Distribution
Date, the sum of (i) any Overcollateralization Reduction Amount for such
Distribution Date and (ii) the excess of (x) the Available Funds for such
Distribution Date over (y) the sum for such Distribution Date of (A) the Senior
Interest Distribution Amount, (B) the Interest Distribution Amounts payable to
the Mezzanine Certificates and (C) the Principal Remittance Amount.
"Net Mortgage Rate": With respect to any Mortgage Loan (or the
related REO Property) as of any date of determination, a per annum rate of
interest equal to the then applicable Mortgage Rate for such Mortgage Loan minus
the Servicing Fee Rate.
"Net WAC Pass-Through Rate": For any Distribution Date with respect
to any Class of Group I Certificates, a per annum rate equal to the product of
(x) the weighted average of the Expense Adjusted Net Mortgage Rates of the Group
I Mortgage Loans, weighted on the basis of the outstanding Stated Principal
Balances of the Group I Mortgage Loans as of the first day of the month
preceding the month of such Distribution Date (after giving effect to scheduled
payments of principal due during the related Due Period, to the extent received
or advanced, and unscheduled collections of principal received during the
related Prepayment Period) and (y) a fraction, the numerator of which is 30 and
the denominator of which is the actual number of days elapsed in the related
Interest Accrual Period. For federal income tax purposes, the economic
equivalent of such rate shall be expressed as the weighted average of the REMIC
II Remittance Rate on REMIC II Regular Interest II-LT1GRP, weighted on the basis
of the Uncertificated Balance of such REMIC II Regular Interest.
For any Distribution Date with respect to any Class of Group II
Certificates, a per annum rate equal to the product of (x) the weighted average
of the Expense Adjusted Net Mortgage Rates of the Group II Mortgage Loans,
weighted on the basis of the outstanding Stated Principal Balances of the Group
II Mortgage Loans as of the first day of the month preceding the month of such
Distribution Date (after giving effect to scheduled payments of principal due
during the related
36
Due Period, to the extent received or advanced, and unscheduled collections of
principal received during the related Prepayment Period) and (y) a fraction, the
numerator of which is 30 and the denominator of which is the actual number of
days elapsed in the related Interest Accrual Period. For federal income tax
purposes, the economic equivalent of such rate shall be expressed as the
weighted average of the REMIC II Remittance Rate on REMIC II Regular Interest
II-LT2GRP, weighted on the basis of the Uncertificated Balance of such REMIC II
Regular Interest.
For any Distribution Date with respect to the Mezzanine
Certificates, a per annum rate equal to the product of (x) the weighted average
(weighted on the basis of the results of subtracting from the aggregate Stated
Principal Balance of each Loan Group the current Certificate Principal Balance
of the related Class A Certificates) of (i) the weighted average of the Expense
Adjusted Net Mortgage Rates of the Group I Mortgage Loans as of the first day of
the month preceding the month of such Distribution Date (after giving effect to
scheduled payments of principal due during the related Due Period, to the extent
received or advanced, and unscheduled collections of principal received during
the related Prepayment Period) and (ii) the weighted average of the Expense
Adjusted Net Mortgage Rates of the Group II Mortgage Loans as of the first day
of the month preceding the month of such Distribution Date (after giving effect
to scheduled payments of principal due during the related Due Period, to the
extent received or advanced, and unscheduled collections of principal received
during the related Prepayment Period) and (y) a fraction, the numerator of which
is 30 and the denominator of which is the actual number of days elapsed in the
related Interest Accrual Period. For federal income tax purposes, the economic
equivalent of such rate shall be expressed as the weighted average of the REMIC
II Remittance Rates on (a) REMIC II Regular Interest II-LT1SUB, subject to a cap
and a floor equal to the Expense Adjusted Net Mortgage Rates of the Group I
Mortgage Loans and (b) REMIC II Regular Interest II-LT2SUB, subject to a cap and
a floor equal to the Expense Adjusted Net Mortgage Rates of the Group II
Mortgage Loans, weighted on the basis of the Uncertificated Balance of each such
REMIC II Regular Interest.
"Net WAC Rate Carryover Amount": With respect to any Class of Class
A Certificates and the Mezzanine Certificates and any Distribution Date, the sum
of (A) the excess of (i) the amount of interest such Certificates would have
accrued for such Distribution Date had the applicable Pass-Through Rate been
calculated at the related Formula Rate, over (ii) the amount of interest accrued
on such Certificates at the related Net WAC Pass-Through Rate for such
Distribution Date and (B) the related Net WAC Rate Carryover Amount for the
previous Distribution Date not previously paid, together with interest thereon
at a rate equal to the related Formula Rate applicable for such Class in each
case for the Interest Accrual Period for the current Distribution Date.
"Net WAC Rate Carryover Reserve Account": The Net WAC Rate Carryover
Reserve Account established and maintained pursuant to Section 4.10.
"New Lease": Any lease of REO Property entered into on behalf of
REMIC I, including any lease renewed or extended on behalf of REMIC I, if REMIC
I has the right to renegotiate the terms of such lease.
37
"NIMS Insurer": Any insurer that is guaranteeing certain payments
under notes secured by collateral which includes, among other things, all or a
portion of the Class CE Certificates, the Class P Certificates and/or the
Residual Certificates.
"Nonrecoverable Advance": Any Advance previously made or proposed to
be made in respect of a Mortgage Loan or REO Property that, in the good faith
business judgment of the Master Servicer, will not or, in the case of a proposed
Advance, would not be ultimately recoverable from related Late Collections,
Insurance Proceeds or Liquidation Proceeds on such Mortgage Loan or REO Property
as provided herein.
"Nonrecoverable Servicing Advance": Any Servicing Advance previously
made or proposed to be made in respect of a Mortgage Loan or REO Property that,
in the good faith business judgment of the Master Servicer, will not or, in the
case of a proposed Servicing Advance, would not be ultimately recoverable from
related Late Collections, Insurance Proceeds or Liquidation Proceeds on such
Mortgage Loan or REO Property as provided herein.
"Non-United States Person": Any Person other than a United States
Person.
"Notional Amount": With respect to the Class CE Interest and any
Distribution Date, the Uncertificated Balance of the REMIC II Regular Interests
(other than REMIC II Regular Interest II-LTP) immediately prior to such
Distribution Date.
"Officers' Certificate": With respect to the Depositor, a
certificate signed by the Chairman of the Board, the Vice Chairman of the Board,
the President or a vice president (however denominated), and by the Treasurer,
the Secretary, or one of the assistant treasurers or assistant secretaries. With
respect to the Master Servicer, any officer who is authorized to act for the
Master Servicer in matters relating to this Agreement, and whose action is
binding upon the Master Servicer, initially including those individuals whose
names appear on the list of authorized officers delivered at the closing.
"Offered Certificate": Any one of the Class A Certificates and the
Mezzanine Certificates (other than the Class M-7, Class M-8, Class M-9 and Class
M-10 Certificates), issued under this Agreement.
"One-Month LIBOR": With respect to the Adjustable-Rate Certificates,
REMIC II Regular Interest II-LTA1, REMIC II Regular Interest II-LTA2, REMIC II
Regular Interest II-LTA3, REMIC II Regular Interest II-LTA4, REMIC II Regular
Interest II-LTA5, REMIC II Regular Interest II-LTM1, REMIC II Regular Interest
II-LTM2, REMIC II Regular Interest II-LTM3, REMIC II Regular Interest II-LTM4,
REMIC II Regular Interest II-LTM5, REMIC II Regular Interest II-LTM6, REMIC II
Regular Interest II-LTM7, REMIC II Regular Interest II-LTM8, REMIC II Regular
Interest II-LTM9 and REMIC II Regular Interest II-LTM10 and any Interest Accrual
Period therefor, the rate determined by the Trustee on the related Interest
Determination Date on the basis of the offered rate for one-month U.S. dollar
deposits, as such rate appears on Telerate Page 3750 as of 11:00 a.m. (London
time) on such Interest Determination Date; provided that if such rate does not
appear on Telerate Page 3750, the rate for such date shall be determined on the
basis of the offered rates of the Reference Banks for one-month U.S. dollar
deposits, as of 11:00 a.m. (London time) on such Interest
38
Determination Date. In such event, the Trustee shall request the principal
London office of each of the Reference Banks to provide a quotation of its rate.
If on such Interest Determination Date, two or more Reference Banks provide such
offered quotations, One-Month LIBOR for the related Interest Accrual Period
shall be the arithmetic mean of such offered quotations (rounded upwards if
necessary to the nearest whole multiple of 1/16%). If on such Interest
Determination Date, fewer than two Reference Banks provide such offered
quotations, One-Month LIBOR for the related Interest Accrual Period shall be the
higher of (i) LIBOR as determined on the previous Interest Determination Date
and (ii) the Reserve Interest Rate. Notwithstanding the foregoing, if, under the
priorities described above, LIBOR for an Interest Determination Date would be
based on LIBOR for the previous Interest Determination Date for the third
consecutive Interest Determination Date, the Trustee shall select, after
consultation with the NIMS Insurer, an alternative comparable index (over which
the Trustee has no control), used for determining one-month Eurodollar lending
rates that is calculated and published (or otherwise made available) by an
independent party.
"Opinion of Counsel": A written opinion of counsel, who may, without
limitation, be salaried counsel for the Depositor or the Master Servicer
acceptable to the Trustee, if such opinion is delivered to the Trustee, except
that any opinion of counsel relating to (a) the qualification of any Trust REMIC
as a REMIC or (b) compliance with the REMIC Provisions must be an opinion of
Independent counsel.
"Optional Termination Date": The first Distribution Date on which
the aggregate Stated Principal Balance of the Mortgage Loans (and properties
acquired in respect thereof) remaining in the Trust Fund is reduced to an amount
less than 10% of the sum of (x) the aggregate Stated Principal Balance of the
Initial Mortgage Loans as of the Cut-off Date and (y) the Original Pre-Funded
Amounts.
"Original Group I Pre-Funded Amount": The amount deposited by the
Depositor in the Group I Pre-Funding Account on the Closing Date, which amount
is $158,910,796.00.
"Original Group II Pre-Funded Amount": The amount deposited by the
Depositor in the Group II Pre-Funding Account on the Closing Date, which amount
is $41,089,473.00.
"Original Pre-Funded Amounts": The sum of the Original Group I
Pre-Funded Amount and the Original Group II Pre-Funded Amount.
"Originators": Collectively, Argent Mortgage Company, LLC and
Olympus Mortgage Company.
"Overcollateralization Deficiency Amount": With respect to any
Distribution Date, the excess, if any, of (a) the Overcollateralization Target
Amount applicable to such Distribution Date over (b) the Overcollateralized
Amount applicable to such Distribution Date (calculated for this purpose only,
after assuming that 100% of the Principal Remittance Amount on such Distribution
Date has been distributed).
39
"Overcollateralization Increase Amount": With respect to any
Distribution Date, the lesser of (a) the Overcollateralization Deficiency Amount
as of such Distribution Date and (b) the Net Monthly Excess Cashflow for such
Distribution Date.
"Overcollateralization Reduction Amount": With respect to any
Distribution Date, an amount equal to the lesser of (a) the Excess
Overcollateralized Amount on such Distribution Date and (b) the Principal
Remittance Amount on such Distribution Date.
"Overcollateralization Target Amount": With respect to any
Distribution Date (i) prior to the Stepdown Date, 2.95% of the sum of the
aggregate Stated Principal Balance of the Initial Mortgage Loans as of the
Cut-off Date and the Original Pre-Funded Amounts, (ii) on or after the Stepdown
Date provided a Trigger Event is not in effect, the greater of (x) 5.90% of the
aggregate Stated Principal Balance of the Mortgage Loans as of the last day of
the related Due Period (after giving effect to scheduled payments of principal
due during the related Due Period, to the extent received or advanced and
unscheduled collections of principal received during the related Prepayment
Period) and (y) $5,000,001, or (iii) on or after the Stepdown Date and if a
Trigger Event is in effect, the Overcollateralization Target Amount for the
immediately preceding Distribution Date.
"Overcollateralized Amount": With respect to any Distribution Date,
the excess, if any, of (a) the aggregate Stated Principal Balances of the
Mortgage Loans and REO Properties immediately following such Distribution Date
(after giving effect to scheduled payments of principal due during the related
Due Period, to the extent received or advanced, and unscheduled collections of
principal received during the related Prepayment Period) and the amount on
deposit in the Pre- Funding Accounts as of the last day of the related Due
Period, over (b) the sum of the aggregate Certificate Principal Balances of the
Class A Certificates, the Mezzanine Certificates and the Class P Certificates as
of such Distribution Date (after giving effect to distributions to be made on
such Distribution Date).
"Ownership Interest": As to any Certificate, any ownership or
security interest in such Certificate, including any interest in such
Certificate as the Holder thereof and any other interest therein, whether direct
or indirect, legal or beneficial, as owner or as pledgee.
"Pass-Through Rate": With respect to any Class of Adjustable-Rate
Certificates and any Distribution Date, the lesser of (x) the related Formula
Rate for such Distribution Date and (y) the related Net WAC Pass-Through Rate
for such Distribution Date.
With respect to the Class CE Interest and any Distribution Date, a
rate per annum equal to the percentage equivalent of a fraction, the numerator
of which is the sum of the amounts calculated pursuant to clauses (i) through
(xviii) below, and the denominator of which is the aggregate Uncertificated
Balance of REMIC II Regular Interests XX-XXXX, XX-XXX0, XX-XXX0, XX- XXX0,
XX-XXX0, XX-XXX0, XX-XXX0, XX-XXX0, XX-XXX0, XX-XXX0, XX-XXX0, II-LTM6, II-LTM7,
II- LTM8, II-LTM9, II-LTM10 and II-LTZZ. For purposes of calculating the
Pass-Through Rate for the Class CE Certificates, the numerator is equal to the
sum of the following components:
40
i. the REMIC II Remittance Rate for REMIC II Regular Interest II the
Marker Rate, applied to an amount equal to the Uncertificated Balance of
REMIC II Regular Interest II-LTAA;
ii. the REMIC II Remittance Rate for REMIC II Regular Interest
II-LTA1 minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest II-LTA1;
iii. the REMIC II Remittance Rate for REMIC II Regular Interest
II-LTA2 minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest II-LTA2;
iv. the REMIC II Remittance Rate for REMIC II Regular Interest
II-LTA3 minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest II-LTA3;
v. the REMIC II Remittance Rate for REMIC II Regular Interest
II-LTA4 minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest II-LTA4;
vi. the REMIC II Remittance Rate for REMIC II Regular Interest
II-LTA5 minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest II-LTA5;
vii. the REMIC II Remittance Rate for REMIC II Regular Interest
II-LTM1 minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest II-LTM1;
viii. the REMIC II Remittance Rate for REMIC II Regular Interest
II-LTM2 minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest II-LTM2;
ix. the REMIC II Remittance Rate for REMIC II Regular Interest
II-LTM3 minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest II-LTM3;
x. the REMIC II Remittance Rate for REMIC II Regular Interest
II-LTM4 minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest II-LTM4;
xi. the REMIC II Remittance Rate for REMIC II Regular Interest
II-LTM5 minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest II-LTM5;
41
xii. the REMIC II Remittance Rate for REMIC II Regular Interest
II-LTM6 minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest II-LTM6;
xiii. the REMIC II Remittance Rate for REMIC II Regular Interest
II-LTM7 minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest II-LTM7;
xiv. the REMIC II Remittance Rate for REMIC II Regular Interest
II-LTM8 minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest II-LTM8;
xv. the REMIC II Remittance Rate for REMIC II Regular Interest
II-LTM9 minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest II-LTM9;
xvi. the REMIC II Remittance Rate for REMIC II Regular Interest
II-LTM10 minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest II-LTM10;
xvii. the REMIC II Remittance Rate for REMIC II Regular Interest
II-LTZZ minus the Marker Rate, applied to an amount equal to the
Uncertificated Balance of REMIC II Regular Interest II-LTZZ; and
xviii. 100% of the interest on REMIC II Regular Interest II-LTP.
With respect to the Class CE Certificates, 100% of the interest
distributable to the Class CE Interest, expressed as a per annum rate.
"Percentage Interest": With respect to any Class of Certificates
(other than the Residual Certificates), the undivided percentage ownership in
such Class evidenced by such Certificate, expressed as a percentage, the
numerator of which is the initial Certificate Principal Balance or Notional
Amount represented by such Certificate and the denominator of which is the
aggregate initial Certificate Principal Balance or Notional Amount of all of the
Certificates of such Class. The Class A Certificates and the Mezzanine
Certificates (other than the Class M-7, Class M- 8, Class M-9 and Class M-10
Certificates) are issuable only in minimum Percentage Interests corresponding to
minimum initial Certificate Principal Balances of $25,000 and integral multiples
of $1.00 in excess thereof. The Class X-0, Xxxxx X-0, Class M-9 and Class M-10
Certificates are issuable only in minimum Percentage Interests corresponding to
minimum initial Certificate Principal Balances of $50,000 and integral multiples
of $1.00 in excess thereof. The Class P Certificates are issuable only in
minimum Percentage Interests corresponding to minimum initial Certificate
Principal Balances of $20 and integral multiples thereof. The Class CE
Certificates are issuable only in minimum Percentage Interests corresponding to
minimum initial Notional Amount of $10,000 and integral multiples of $1.00 in
excess thereof; provided, however, that a single Certificate of such Class of
Certificates may be issued having a Percentage Interest corresponding to the
remainder of the aggregate initial Certificate Principal Balance or Notional
Amount of such
42
Class or to an otherwise authorized denomination for such Class plus such
remainder. With respect to any Residual Certificate, the undivided percentage
ownership in such Class evidenced by such Certificate, as set forth on the face
of such Certificate. The Residual Certificates are issuable in Percentage
Interests of 20% and multiples thereof.
"Periodic Rate Cap": With respect to each Adjustable-Rate Mortgage
Loan and any Adjustment Date therefor, the fixed percentage set forth in the
related Mortgage Note, which is the maximum amount by which the Mortgage Rate
for such Mortgage Loan may increase or decrease (without regard to the Maximum
Mortgage Rate or the Minimum Mortgage Rate) on such Adjustment Date from the
Mortgage Rate in effect immediately prior to such Adjustment Date.
"Permitted Investments": Any one or more of the following
obligations or securities acquired at a purchase price of not greater than par,
regardless of whether issued by the Depositor, the Master Servicer, the NIMS
Insurer, the Trustee or any of their respective Affiliates:
(i) direct obligations of, or obligations fully guaranteed as to
timely payment of principal and interest by, the United States or any
agency or instrumentality thereof, provided such obligations are backed by
the full faith and credit of the United States;
(ii) demand and time deposits in, certificates of deposit of, or
bankers' acceptances (which shall each have an original maturity of not
more than 90 days and, in the case of bankers' acceptances, shall in no
event have an original maturity of more than 365 days or a remaining
maturity of more than 30 days) denominated in United States dollars and
issued by, any Depository Institution;
(iii) repurchase obligations with respect to any security described
in clause (i) above entered into with a Depository Institution (acting as
principal);
(iv) securities bearing interest or sold at a discount that are
issued by any corporation incorporated under the laws of the United States
of America or any state thereof and that are rated by each Rating Agency
that rates such securities in its highest long-term unsecured rating
categories at the time of such investment or contractual commitment
providing for such investment;
(v) commercial paper (including both non-interest-bearing discount
obligations and interest-bearing obligations payable on demand or on a
specified date not more than 30 days after the date of acquisition
thereof) that is rated by each Rating Agency that rates such securities in
its highest short-term unsecured debt rating available at the time of such
investment;
(vi) units of money market funds, including money market funds
advised by the Trustee or an Affiliate thereof, that have been rated "Aaa"
by Moody's, "AAA" by Fitch and "AAAm" by S&P; and
(vii) if previously confirmed in writing to the Trustee and
consented to by the NIMS Insurer, any other demand, money market or time
deposit, or any other obligation,
43
security or investment, as may be acceptable to the Rating Agencies as a
permitted investment of funds backing securities having ratings equivalent
to its highest initial rating of the Class A Certificates;
provided, however, that no instrument described hereunder shall evidence either
the right to receive (a) only interest with respect to the obligations
underlying such instrument or (b) both principal and interest payments derived
from obligations underlying such instrument and the interest and principal
payments with respect to such instrument provide a yield to maturity at par
greater than 120% of the yield to maturity at par of the underlying obligations.
"Permitted Transferee": Any Transferee of a Residual Certificate
other than a Disqualified Organization or Non-United States Person.
"Person": Any individual, corporation, partnership, joint venture,
association, joint- stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
"Plan": Any employee benefit plan or certain other retirement plans
and arrangements, including individual retirement accounts and annuities, Xxxxx
plans and bank collective investment funds and insurance company general or
separate accounts in which such plans, accounts or arrangements are invested,
that are subject to ERISA or Section 4975 of the Code.
"Pre-Funding Accounts": The Group I Pre-Funding Account and the
Group II Pre- Funding Account.
"Prepayment Assumption": As defined in the Prospectus Supplement.
"Prepayment Charge": With respect to any Prepayment Period, any
prepayment premium, fee or charge payable by a Mortgagor in connection with any
Principal Prepayment pursuant to the terms of the related Mortgage Note as from
time to time held as a part of the Trust Fund, the Prepayment Charges so held
being identified in the Prepayment Charge Schedule (other than any Master
Servicer Prepayment Charge Payment Amount).
"Prepayment Charge Schedule": As of any date, the list of Prepayment
Charges included in the Trust Fund on such date, attached hereto as Schedule 2
(including the prepayment charge summary attached thereto) and as supplemented
by each schedule of Subsequent Mortgage Loans attached to the Subsequent
Transfer Instrument. The Prepayment Charge Schedule shall set forth the
following information with respect to each Prepayment Charge:
(i) the Master Servicer's Mortgage Loan identifying number;
(ii) a code indicating the type of Prepayment Charge;
(iii) the date on which the first Monthly Payment was due on the
related Mortgage Loan;
44
(iv) the term of the related Prepayment Charge;
(v) the original Stated Principal Balance of the related Mortgage
Loan;
(vi) the Stated Principal Balance of the related Mortgage Loan as of
the Cut-off Date (or the related Subsequent Cut-off Date with respect to a
Subsequent Mortgage Loan);
The Prepayment Charge Schedule shall be amended from time to time by
the Master Servicer in accordance with the provisions of this Agreement and a
copy of such amended Prepayment Charge Schedule shall be furnished by the Master
Servicer to the NIMS Insurer and the Special Sub-Servicer.
"Prepayment Interest Excess": With respect to any Distribution Date,
for each Mortgage Loan that was the subject of a Principal Prepayment in full
during the portion of the related Prepayment Period occurring between the first
day of the calendar month in which such Distribution Date occurs and the
Determination Date of the calendar month in which such Distribution Date occurs,
an amount equal to interest (to the extent received) at the applicable Net
Mortgage Rate on the amount of such Principal Prepayment for the number of days
commencing on the first day of the calendar month in which such Distribution
Date occurs and ending on the last date through which interest is collected from
the related Mortgagor. The Master Servicer may withdraw such Prepayment Interest
Excess from the Collection Account in accordance with Section 3.05(a)(iv).
"Prepayment Interest Shortfall": With respect to any Distribution
Date, for each Mortgage Loan that was the subject of a Principal Prepayment in
full during the portion of the related Prepayment Period occurring between the
first day of the related Prepayment Period and the last day of the calendar
month preceding the month in which such Distribution Date occurs, an amount
equal to interest at the applicable Net Mortgage Rate on the amount of such
Principal Prepayment for the number of days commencing on the day after the last
date on which interest is collected from the related Mortgagor and ending on the
last day of the calendar month preceding such Distribution Date. The obligations
of the Master Servicer in respect of any Prepayment Interest Shortfall are set
forth in Section 4.03(e).
"Prepayment Period": With respect to any Distribution Date, the
period commencing on the day after the Determination Date in the calendar month
preceding the calendar month in which such Distribution Date occurs (or, in the
case of the first Distribution Date, commencing on May 1, 2004) and ending on
the Determination Date in the calendar month in which such Distribution Date
occurs.
"Principal Prepayment": Any payment of principal made by the
Mortgagor on a Mortgage Loan which is received in advance of its scheduled Due
Date and which is not accompanied by an amount of interest representing the full
amount of scheduled interest due on any Due Date in any month or months
subsequent to the month of prepayment.
"Principal Remittance Amount": With respect to any Distribution
Date, the sum of the (i) the Group I Principal Remittance Amount and (ii) the
Group II Principal Remittance Amount.
45
"Prospectus Supplement": The Prospectus Supplement, dated April 29,
2004, relating to the public offering of the Offered Certificates.
"PTCE": A Prohibited Transaction Class Exemption.
"Purchase Price": With respect to any Mortgage Loan or REO Property
to be purchased pursuant to or as contemplated by Section 2.03, Section 3.16(a)
or Section 9.01, and as confirmed by an Officers' Certificate from the Master
Servicer to the Trustee, an amount equal to the sum of (i) 100% of the Stated
Principal Balance thereof as of the date of purchase (or such other price as
provided in Section 9.01), (ii) in the case of (x) a Mortgage Loan, accrued
interest on such Stated Principal Balance at the applicable Net Mortgage Rate in
effect from time to time from the Due Date as to which interest was last covered
by a payment by the Mortgagor or an advance by the Master Servicer, which
payment or advance had as of the date of purchase been distributed pursuant to
Section 4.01, through the end of the calendar month in which the purchase is to
be effected and (y) an REO Property, the sum of (1) accrued interest on such
Stated Principal Balance at the applicable Net Mortgage Rate in effect from time
to time from the Due Date as to which interest was last covered by a payment by
the Mortgagor or an advance by the Master Servicer through the end of the
calendar month immediately preceding the calendar month in which such REO
Property was acquired, plus (2) REO Imputed Interest for such REO Property for
each calendar month commencing with the calendar month in which such REO
Property was acquired and ending with the calendar month in which such purchase
is to be effected, net of the total of all net rental income, Insurance
Proceeds, Liquidation Proceeds and Advances that as of the date of purchase had
been distributed as or to cover REO Imputed Interest pursuant to Section 4.01,
(iii) any unreimbursed Servicing Advances and Advances and any unpaid Servicing
Fees allocable to such Mortgage Loan or REO Property, (iv) any amounts
previously withdrawn from the Collection Account in respect of such Mortgage
Loan or REO Property pursuant to Sections 3.05(a)(v) and 3.16(a), and (v) in the
case of a Mortgage Loan required to be purchased pursuant to Section 2.03,
expenses reasonably incurred or to be incurred by the Master Servicer, the NIMS
Insurer or the Trustee in respect of the breach or defect giving rise to the
purchase obligation, as well as any costs and damages incurred by the Trust Fund
in connection with any violation by such loan of any predatory or abusive
lending law.
"Qualified Substitute Mortgage Loan": A mortgage loan substituted
for a Deleted Mortgage Loan pursuant to the terms of this Agreement which must,
on the date of such substitution, (i) have an outstanding Stated Principal
Balance, after application of all scheduled payments of principal and interest
due during or prior to the month of substitution, not in excess of the Scheduled
Principal Balance of the Deleted Mortgage Loan as of the Due Date in the
calendar month during which the substitution occurs, (ii) have a Mortgage Rate
not less than (and not more than one percentage point in excess of) the Mortgage
Rate of the Deleted Mortgage Loan, (iii) with respect to any Adjustable-Rate
Mortgage Loan, have a Maximum Mortgage Rate not less than the Maximum Mortgage
Rate on the Deleted Mortgage Loan, (iv) with respect to any Adjustable-Rate
Mortgage Loan, have a Minimum Mortgage Rate not less than the Minimum Mortgage
Rate of the Deleted Mortgage Loan, (v) with respect to Adjustable-Rate Mortgage
Loan, have a Gross Margin equal to the Gross Margin of the Deleted Mortgage
Loan, (vi) with respect to any Adjustable-Rate Mortgage Loan, have a next
Adjustment Date not more than two months later than the next Adjustment Date on
the Deleted Mortgage Loan, (vii) have a remaining term to maturity not greater
than (and not more than one year less than) that of the Deleted Mortgage Loan,
(viii) have the same Due Date as
46
the Due Date on the Deleted Mortgage Loan, (ix) have a Loan-to-Value Ratio as of
the date of substitution equal to or lower than the Loan-to-Value Ratio of the
Deleted Mortgage Loan as of such date, (x) have a risk grading determined by the
Seller at least equal to the risk grading assigned on the Deleted Mortgage Loan,
(xi) have been underwritten or reunderwritten by the Seller in accordance with
the same underwriting criteria and guidelines as the Deleted Mortgage Loan,
(xii) have a Prepayment Charge provision at least equal to the Prepayment Charge
provision of the Deleted Mortgage Loan, (xiii) not be more than 59 or more days
delinquent or any additional days delinquent than the Deleted Mortgage Loan and
(xiv) conform to each representation and warranty set forth in Section 6 of the
Mortgage Loan Purchase Agreement applicable to the Deleted Mortgage Loan. In the
event that one or more mortgage loans are substituted for one or more Deleted
Mortgage Loans, the amounts described in clause (i) hereof shall be determined
on the basis of aggregate Stated Principal Balances, the Mortgage Rates
described in clause (ii) hereof shall be determined on the basis of weighted
average Mortgage Rates, the risk gradings described in clause (x) hereof shall
be satisfied as to each such mortgage loan, the terms described in clause (vii)
hereof shall be determined on the basis of weighted average remaining terms to
maturity, the Loan-to-Value Ratios described in clause (ix) hereof shall be
satisfied as to each such mortgage loan and, except to the extent otherwise
provided in this sentence, the representations and warranties described in
clause (xi) hereof must be satisfied as to each Qualified Substitute Mortgage
Loan or in the aggregate, as the case may be.
"Rating Agency" or "Rating Agencies": Xxxxx'x, Fitch and S&P or
their successors. If such agencies or their successors are no longer in
existence, "Rating Agencies" shall be such nationally recognized statistical
rating agencies, or other comparable Persons, designated by the Depositor,
notice of which designation shall be given to the Trustee and the Master
Servicer.
"Realized Loss": With respect to each Mortgage Loan as to which a
Final Recovery Determination has been made, an amount (not less than zero) equal
to (i) the unpaid Stated Principal Balance of such Mortgage Loan as of the
commencement of the calendar month in which the Final Recovery Determination was
made, plus (ii) accrued interest from the Due Date as to which interest was last
paid by the Mortgagor through the end of the calendar month in which such Final
Recovery Determination was made, calculated in the case of each calendar month
during such period (A) at an annual rate equal to the annual rate at which
interest was then accruing on such Mortgage Loan and (B) on a principal amount
equal to the Stated Principal Balance of such Mortgage Loan as of the close of
business on the Distribution Date during such calendar month, plus (iii) any
amounts previously withdrawn from the Collection Account in respect of such
Mortgage Loan pursuant to Section 3.05(a)(v) and Section 3.12(c), minus (iv) the
proceeds, if any, received in respect of such Mortgage Loan during the calendar
month in which such Final Recovery Determination was made, net of amounts that
are payable therefrom to the Master Servicer with respect to such Mortgage Loan
pursuant to Section 3.05(a)(ii).
If the Master Servicer receives Subsequent Recoveries with respect
to any Mortgage Loan, the amount of the Realized Loss with respect to that
Mortgage Loan will be reduced to the extent such recoveries are applied to
principal distributions on any Distribution Date.
With respect to any REO Property as to which a Final Recovery
Determination has been made, an amount (not less than zero) equal to (i) the
unpaid Stated Principal Balance of the
47
related Mortgage Loan as of the date of acquisition of such REO Property on
behalf of REMIC I, plus (ii) accrued interest from the Due Date as to which
interest was last paid by the Mortgagor in respect of the related Mortgage Loan
through the end of the calendar month immediately preceding the calendar month
in which such REO Property was acquired, calculated in the case of each calendar
month during such period (A) at an annual rate equal to the annual rate at which
interest was then accruing on the related Mortgage Loan and (B) on a principal
amount equal to the Stated Principal Balance of the related Mortgage Loan as of
the close of business on the Distribution Date during such calendar month, plus
(iii) REO Imputed Interest for such REO Property for each calendar month
commencing with the calendar month in which such REO Property was acquired and
ending with the calendar month in which such Final Recovery Determination was
made, plus (iv) any amounts previously withdrawn from the Collection Account in
respect of the related Mortgage Loan pursuant to Section 3.05(a)(v) and Section
3.12(c), minus (v) the aggregate of all Advances made by the Master Servicer in
respect of such REO Property or the related Mortgage Loan for which the Master
Servicer has been or, in connection with such Final Recovery Determination,
shall be reimbursed pursuant to Section 3.13 out of rental income, Insurance
Proceeds and Liquidation Proceeds received in respect of such REO Property,
minus (vi) the total of all net rental income, Insurance Proceeds and
Liquidation Proceeds received in respect of such REO Property that has been, or
in connection with such Final Recovery Determination, shall be transferred to
the Distribution Account pursuant to Section 3.13.
With respect to each Mortgage Loan which has become the subject of a
Deficient Valuation, the difference between the Stated Principal Balance of the
Mortgage Loan outstanding immediately prior to such Deficient Valuation and the
Stated Principal Balance of the Mortgage Loan as reduced by the Deficient
Valuation.
With respect to each Mortgage Loan which has become the subject of a
Debt Service Reduction, the portion, if any, of the reduction in each affected
Monthly Payment attributable to a reduction in the Mortgage Rate imposed by a
court of competent jurisdiction. Each such Realized Loss shall be deemed to have
been incurred on the Due Date for each affected Monthly Payment.
"Record Date": With respect to each Distribution Date and any
Adjustable-Rate Certificate that is a Book-Entry Certificate, the Business Day
immediately preceding such Distribution Date. With respect to each Distribution
Date and any other Class of Certificates, including any Definitive Certificates,
the last Business Day of the month immediately preceding the month in which such
Distribution Date occurs.
"Reference Banks": Deutsche Bank, Xxxxxxx'x Bank PLC, The Tokyo
Mitsubishi Bank and National Westminster Bank PLC and their successors in
interest; provided, however, that if any of the foregoing banks are not suitable
to serve as a Reference Bank, then any leading banks selected by the Trustee
(after consultation with the NIMS Insurer) which are engaged in transactions in
Eurodollar deposits in the international Eurocurrency market (i) with an
established place of business in London, (ii) not controlling, under the control
of or under common control with the Depositor or any Affiliate thereof and (iii)
which have been designated as such by the Trustee.
"Refinanced Mortgage Loan": A Mortgage Loan the proceeds of which
were not used to purchase the related Mortgaged Property.
48
"Regular Certificate": Any Class A Certificate, Mezzanine
Certificate, Class P Certificate or Class CE Certificate.
"Regular Interest": A "regular interest" in a REMIC within the
meaning of Section 860G(a)(1) of the Code.
"Relief Act": The Servicemembers Civil Relief Act or any applicable
state law providing similar relief.
"Relief Act Interest Shortfall": With respect to any Distribution
Date and any Mortgage Loan, any reduction in the amount of interest collectible
on such Mortgage Loan for the most recently ended calendar month as a result of
the application of the Relief Act.
"REMIC": A "real estate mortgage investment conduit" within the
meaning of Section 860D of the Code.
"REMIC I": The segregated pool of assets subject hereto,
constituting the primary trust created hereby and to be administered hereunder,
with respect to which a REMIC election is to be made, consisting of: (i) such
Mortgage Loans and Prepayment Charges as from time to time are subject to this
Agreement, together with the Mortgage Files relating thereto, and together with
all collections thereon and proceeds thereof, (ii) any REO Property, together
with all collections thereon and proceeds thereof, (iii) the Trustee's rights
with respect to the Mortgage Loans under all insurance policies, required to be
maintained pursuant to this Agreement and any proceeds thereof, (iv) the
Depositor's rights under the Mortgage Loan Purchase Agreement (including any
security interest created thereby) to the extent conveyed pursuant to Section
2.01 and (v) the Collection Account (other than any amounts representing any
Master Servicer Prepayment Charge Payment Amounts), the Distribution Account
(other than any amounts representing any Master Servicer Prepayment Charge
Payment Amounts) and any REO Account and such assets that are deposited therein
from time to time and any investments thereof, together with any and all income,
proceeds and payments with respect thereto. Notwithstanding the foregoing,
however, REMIC I specifically excludes any Master Servicer Prepayment Charge
Payment Amounts, the Net WAC Rate Carryover Reserve Account, the Cap Contracts,
the Pre-Funding Accounts, the Interest Coverage Account(s), any Subsequent
Mortgage Loan Interest, all payments and other collections of principal and
interest due on the Mortgage Loans on or before the Cut-off Date and all
Prepayment Charges payable in connection with Principal Prepayments made before
the Cut-off Date.
"REMIC I Regular Interest": Any of the separate non-certificated
beneficial ownership interests in REMIC I issued hereunder and designated as a
"regular interest" in REMIC I. Each REMIC I Regular Interest shall accrue
interest at the related REMIC I Remittance Rate in effect from time to time, and
shall be entitled to distributions of principal, subject to the terms and
conditions hereof, in an aggregate amount equal to its initial Uncertificated
Balance as set forth in the Preliminary Statement hereto.
"REMIC I Regular Interest I-LT1": One of the separate
non-certificated beneficial ownership interests in REMIC I issued hereunder and
designated as a Regular Interest in REMIC I. REMIC I Regular Interest I-LT1
shall accrue interest at the related REMIC I Remittance Rate in
49
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Balance as set forth in the Preliminary Statement hereto.
"REMIC I Regular Interest I-LT1PF": One of the separate
non-certificated beneficial ownership interests in REMIC I issued hereunder and
designated as a Regular Interest in REMIC I. REMIC I Regular Interest I-LT1PF
shall accrue interest at the related REMIC I Remittance Rate in effect from time
to time, and shall be entitled to distributions of principal, subject to the
terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.
"REMIC I Regular Interest I-LT2": One of the separate
non-certificated beneficial ownership interests in REMIC I issued hereunder and
designated as a Regular Interest in REMIC I. REMIC I Regular Interest I-LT2
shall accrue interest at the related REMIC I Remittance Rate in effect from time
to time, and shall be entitled to distributions of principal, subject to the
terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.
"REMIC I Regular Interest I-LT2PF": One of the separate
non-certificated beneficial ownership interests in REMIC I issued hereunder and
designated as a Regular Interest in REMIC I. REMIC I Regular Interest I-LT2PF
shall accrue interest at the related REMIC I Remittance Rate in effect from time
to time, and shall be entitled to distributions of principal, subject to the
terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.
"REMIC I Regular Interest I-LTP": One of the separate
non-certificated beneficial ownership interests in REMIC I issued hereunder and
designated as a Regular Interest in REMIC I. REMIC I Regular Interest I-LTP
shall accrue interest at the related REMIC I Remittance Rate in effect from time
to time, and shall be entitled to distributions of principal, subject to the
terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.
"REMIC I Remittance Rate": With respect to REMIC I Regular Interest
I-LT1 and REMIC I Regular Interest I-LTP, and (i) for the first three
Distribution Dates, the weighted average of the Expense Adjusted Net Mortgage
Rates of the initial Group I Mortgage Loans and (ii) thereafter, the weighted
average of the Expense Adjusted Net Mortgage Rates of the Group I Mortgage
Loans. With respect to REMIC I Regular Interest I-LT2, and (i) for the first
three Distribution Dates, the weighted average of the Expense Adjusted Net
Mortgage Rates of the initial Group II Mortgage Loans and (ii) thereafter, the
weighted average of the Expense Adjusted Net Mortgage Rates of the Group II
Mortgage Loans. With respect to REMIC I Regular Interest I-LT1PF and (i) the
first three Distribution Dates, 6.54% and (ii) thereafter, the weighted average
of the Expense Adjusted Net Mortgage Rates of the Group I Mortgage Loans. With
respect to REMIC I Regular Interest I-LT2PF and (i) the first three Distribution
Dates, 6.54% and (ii) thereafter, the weighted average of the Expense Adjusted
Net Mortgage Rates of the Group II Mortgage Loans.
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"REMIC II Interest Loss Allocation Amount": With respect to any
Distribution Date, an amount (subject to adjustment based on the actual number
of days elapsed in the respective Interest Accrual Periods for the indicated
Regular Interests for such Distribution Date) equal to (a) the product of (i)
50% of the aggregate Stated Principal Balance of the Mortgage Loans and REO
Properties then outstanding and (ii) the REMIC II Remittance Rate for REMIC II
Regular Interest II-LTAA minus the Marker Rate, divided by (b) 12.
"REMIC II Marker Allocation Percentage": 50% of any amount payable
or loss attributable from the Mortgage Loans, which shall be allocated to REMIC
II Regular Interest II- LTAA, REMIC II Regular Interest II-LTA1, REMIC II
Regular Interest II-LTA2, REMIC II Regular Interest II-LTA3, REMIC II Regular
Interest II-LTA4, REMIC II Regular Interest II-LTA5, REMIC II Regular Interest
II-LTM1, REMIC II Regular Interest II-LTM2, REMIC II Regular Interest II- LTM3,
REMIC II Regular Interest II-LTM4, REMIC II Regular Interest II-LTM5, REMIC II
Regular Interest II-LTM6, REMIC II Regular Interest II-LTM7, REMIC II Regular
Interest II-LTM8, REMIC II Regular Interest II-LTM9, REMIC II Regular Interest
II-LTM10,REMIC II Regular Interest II- LTZZ and REMIC II Regular Interest
II-LTP.
"REMIC II Overcollateralization Target Amount": 0.50% of the
Overcollateralization Target Amount.
"REMIC II Overcollateralized Amount": With respect to any date of
determination, (i) 0.50% of the aggregate Uncertificated Balances of the REMIC
II Regular Interests minus (ii) the aggregate of the Uncertificated Balances of
REMIC II Regular Interest II-LTA1, REMIC II Regular Interest II-LTA2, REMIC II
Regular Interest II-LTA3, REMIC II Regular Interest II-LTA4, REMIC II Regular
Interest II-LTA5, REMIC II Regular Interest II-LTM1, REMIC II Regular Interest
II- LTM2, REMIC II Regular Interest II-LTM3, REMIC II Regular Interest II-LTM4,
REMIC II Regular Interest II-LTM5, REMIC II Regular Interest II-LTM6, REMIC II
Regular Interest II-LTM7, REMIC II Regular Interest II-LTM8, REMIC II Regular
Interest II-LTM9, REMIC II Regular Interest II- LTM10 and REMIC II Regular
Interest II-LTP, in each case as of such date of determination.
"REMIC II Principal Loss Allocation Amount": With respect to any
Distribution Date, an amount equal to the product of (i) 50% of the aggregate
Stated Principal Balance of the Mortgage Loans and REO Properties then
outstanding and (ii) 1 minus a fraction, the numerator of which is two times the
aggregate of the Uncertificated Balances of REMIC II Regular Interest II- LTA1,
REMIC II Regular Interest II-LTA2, REMIC II Regular Interest II-LTA3, REMIC II
Regular Interest II-LTA4, REMIC II Regular Interest II-LTA5, REMIC II Regular
Interest II-LTM1, REMIC II Regular Interest II-LTM2, REMIC II Regular Interest
II-LTM3, REMIC II Regular Interest II- LTM4, REMIC II Regular Interest II-LTM5,
REMIC II Regular Interest II-LTM6, REMIC II Regular Interest II-LTM7, REMIC II
Regular Interest II-LTM8, REMIC II Regular Interest II-LTM9 and REMIC II Regular
Interest II-LTM10 and the denominator of which is the aggregate of the
Uncertificated Balances of REMIC II Regular Interest II-LTA1, REMIC II Regular
Interest II-LTA2, REMIC II Regular Interest II-LTA3, REMIC II Regular Interest
II-LTA4, REMIC II Regular Interest II-LTA5, REMIC II Regular Interest II-LTM1,
REMIC II Regular Interest II-LTM2, REMIC II Regular Interest II-LTM3, REMIC II
Regular Interest II-LTM4, REMIC II Regular Interest II-LTM5, REMIC II Regular
Interest II-LTM6, REMIC II Regular Interest II-LTM7, REMIC II Regular Interest
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II-LTM8, REMIC II Regular Interest II-LTM9, REMIC II Regular Interest II-LTM10
and REMIC II Regular Interest II-LTZZ.
"REMIC II Regular Interest": Any of the separate non-certificated
beneficial ownership interests in REMIC II issued hereunder and designated as a
"regular interest" in REMIC II. Each REMIC II Regular Interest shall accrue
interest at the related REMIC II Remittance Rate in effect from time to time,
and shall be entitled to distributions of principal, subject to the terms and
conditions hereof, in an aggregate amount equal to its initial Uncertificated
Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest II-LTAA": One of the separate
non-certificated beneficial ownership interests in REMIC II issued hereunder and
designated as a Regular Interest in REMIC II. REMIC II Regular Interest II-LTAA
shall accrue interest at the related REMIC II Remittance Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest II-LTA1": One of the separate
non-certificated beneficial ownership interests in REMIC II issued hereunder and
designated as a Regular Interest in REMIC II. REMIC II Regular Interest II-LTA1
shall accrue interest at the related REMIC II Remittance Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest II-LTA2": One of the separate
non-certificated beneficial ownership interests in REMIC II issued hereunder and
designated as a Regular Interest in REMIC II. REMIC II Regular Interest II-LTA2
shall accrue interest at the related REMIC II Remittance Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest II-LTA3": One of the separate
non-certificated beneficial ownership interests in REMIC II issued hereunder and
designated as a Regular Interest in REMIC II. REMIC II Regular Interest II-LTA3
shall accrue interest at the related REMIC II Remittance Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest II-LTA4": One of the separate
non-certificated beneficial ownership interests in REMIC II issued hereunder and
designated as a Regular Interest in REMIC II. REMIC II Regular Interest II-LTA4
shall accrue interest at the related REMIC II Remittance Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.
52
"REMIC II Regular Interest II-LTA5": One of the separate
non-certificated beneficial ownership interests in REMIC II issued hereunder and
designated as a Regular Interest in REMIC II. REMIC II Regular Interest II-LTA5
shall accrue interest at the related REMIC II Remittance Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest II-LTM1": One of the separate
non-certificated beneficial ownership interests in REMIC II issued hereunder and
designated as a Regular Interest in REMIC II. REMIC II Regular Interest II-LTM1
shall accrue interest at the related REMIC II Remittance Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest II-LTM2": One of the separate
non-certificated beneficial ownership interests in REMIC II issued hereunder and
designated as a Regular Interest in REMIC II. REMIC II Regular Interest II-LTM2
shall accrue interest at the related REMIC II Remittance Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest II-LTM3": One of the separate
non-certificated beneficial ownership interests in REMIC II issued hereunder and
designated as a Regular Interest in REMIC II. REMIC II Regular Interest II-LTM3
shall accrue interest at the related REMIC II Remittance Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest II-LTM4": One of the separate
non-certificated beneficial ownership interests in REMIC II issued hereunder and
designated as a Regular Interest in REMIC II. REMIC II Regular Interest II-LTM4
shall accrue interest at the related REMIC II Remittance Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest II-LTM5": One of the separate
non-certificated beneficial ownership interests in REMIC II issued hereunder and
designated as a Regular Interest in REMIC II. REMIC II Regular Interest II-LTM5
shall accrue interest at the related REMIC II Remittance Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest II-LTM6": One of the separate
non-certificated beneficial ownership interests in REMIC II issued hereunder and
designated as a Regular Interest in REMIC II. REMIC II Regular Interest II-LTM6
shall accrue interest at the related REMIC II Remittance Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and
53
conditions hereof, in an aggregate amount equal to its initial Uncertificated
Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest II-LTM7": One of the separate
non-certificated beneficial ownership interests in REMIC II issued hereunder and
designated as a Regular Interest in REMIC II. REMIC II Regular Interest II-LTM7
shall accrue interest at the related REMIC II Remittance Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest II-LTM8": One of the separate
non-certificated beneficial ownership interests in REMIC II issued hereunder and
designated as a Regular Interest in REMIC II. REMIC II Regular Interest II-LTM8
shall accrue interest at the related REMIC II Remittance Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest II-LTM9": One of the separate
non-certificated beneficial ownership interests in REMIC II issued hereunder and
designated as a Regular Interest in REMIC II. REMIC II Regular Interest II-LTM9
shall accrue interest at the related REMIC II Remittance Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest II-LTM10": One of the separate
non-certificated beneficial ownership interests in REMIC II issued hereunder and
designated as a Regular Interest in REMIC II. REMIC II Regular Interest II-LTM10
shall accrue interest at the related REMIC II Remittance Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest II-XX": One of the separate
non-certificated beneficial ownership interests in REMIC II issued hereunder and
designated as a Regular Interest in REMIC II. REMIC II Regular Interest II-XX
shall accrue interest at the related REMIC II Remittance Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest II-LTZZ": One of the separate
non-certificated beneficial ownership interests in REMIC II issued hereunder and
designated as a Regular Interest in REMIC II. REMIC II Regular Interest II-LTZZ
shall accrue interest at the related REMIC II Remittance Rate in effect from
time to time, and shall be entitled to distributions of principal, subject to
the terms and conditions hereof, in an aggregate amount equal to its initial
Uncertificated Balance as set forth in the Preliminary Statement hereto.
54
"REMIC II Regular Interest II-LTP": One of the separate
non-certificated beneficial ownership interests in REMIC II issued hereunder and
designated as a Regular Interest in REMIC II. REMIC II Regular Interest II-LTP
shall be entitled to any Prepayment Charges collected by the Master Servicer and
to a distribution of principal, subject to the terms and conditions hereof, in
an aggregate amount equal to its initial Uncertificated Balance as set forth in
the Preliminary Statement hereto.
"REMIC II Regular Interest II-LT1GRP": One of the separate
non-certificated beneficial ownership interests in REMIC II issued hereunder and
designated as a Regular Interest in REMIC II. REMIC II Regular Interest
II-LT1GRP shall accrue interest at the related REMIC II Remittance Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest II-LT1SUB": One of the separate
non-certificated beneficial ownership interests in REMIC II issued hereunder and
designated as a Regular Interest in REMIC II. REMIC II Regular Interest
II-LT1SUB shall accrue interest at the related REMIC II Remittance Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest II-LT2GRP": One of the separate
non-certificated beneficial ownership interests in REMIC II issued hereunder and
designated as a Regular Interest in REMIC II. REMIC II Regular Interest
II-LT2GRP shall accrue interest at the related REMIC II Remittance Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Balance as set forth in the Preliminary Statement hereto.
"REMIC II Regular Interest II-LT2SUB": One of the separate
non-certificated beneficial ownership interests in REMIC II issued hereunder and
designated as a Regular Interest in REMIC II. REMIC II Regular Interest
II-LT2SUB shall accrue interest at the related REMIC II Remittance Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to its
initial Uncertificated Balance as set forth in the Preliminary Statement hereto.
"REMIC II Remittance Rate": With respect to REMIC II Regular
Interest II-LTAA, REMIC II Regular Interest II-LTA1, REMIC II Regular Interest
II-LTA2, REMIC II Regular Interest II-LTA3, REMIC II Regular Interest II-LTA4,
REMIC II Regular Interest II-LTA5, REMIC II Regular Interest II-LTM1, REMIC II
Regular Interest II-LTM2, REMIC II Regular Interest II-LTM3, REMIC II Regular
Interest II-LTM4, REMIC II Regular Interest II-LTM5, REMIC II Regular Interest
II-LTM6, REMIC II Regular Interest II-LTM7, REMIC II Regular Interest II-LTM8,
REMIC II Regular Interest II-LTM9, REMIC II Regular Interest II-LTM10, REMIC II
Regular Interest II- LTZZ, REMIC II Regular Interest II-LTP, REMIC II Regular
Interest II-LT1SUB, REMIC II Regular Interest II-LT2SUB and REMIC II Regular
Interest II-LTXX, the weighted average of the Expense Adjusted Net Mortgage
Rates of the Mortgage Loans. With respect to REMIC II Regular Interest II- 1GRP,
the weighted average of the Expense Adjusted Net Mortgage Rates of the Group I
Mortgage
55
Loans and with respect REMIC II Regular Interest II-2GRP, the weighted average
of the Expense Adjusted Net Mortgage Rates of the Group II Mortgage Loans.
"REMIC II Sub WAC Allocation Percentage": 50% of any amount payable
from or loss attributable to the Mortgage Loans, which shall be allocated to
REMIC II Regular Interest II- LT1SUB, REMIC II Regular Interest II-LT1GRP, REMIC
II Regular Interest II-LT2SUB, REMIC II Regular Interest II-LT2GRP and REMIC II
Regular Interest II-XX.
"REMIC II Subordinated Balance Ratio": The ratio among the
Uncertificated Balances of each REMIC II Regular Interest ending with the
designation "SUB,", equal to the ratio among, with respect to each such REMIC II
Regular Interest, the excess of (x) the aggregate Stated Principal Balance of
the Mortgage Loans in the related Loan Group over (y) the current Certificate
Principal Balance of Class A Certificates in the related Loan Group.
"REMIC III": The segregated pool of assets consisting of all of the
REMIC II Regular Interests conveyed in trust to the Trustee, for the benefit of
the Holders of the Regular Certificates and the Class R Certificate (in respect
of the Class R-III Interest), pursuant to Article II hereunder, and all amounts
deposited therein, with respect to which a separate REMIC election is to be
made.
"REMIC III Certificate": Any Regular Certificate (other than a Class
CE Certificate or Class P Certificate) or Class R Certificate.
"REMIC III Regular Interest": Any Class A Certificate, Mezzanine
Certificate, the Class CE Interest or Class P Interest.
"REMIC IV": The segregated pool of assets consisting of the Class CE
Interest conveyed in trust to the Trustee, for the benefit of the Holders of the
Regular Certificates and the Class R-X Certificate (in respect of the Class R-IV
Interest), pursuant to Article II hereunder, and all amounts deposited therein,
with respect to which a separate REMIC election is to be made.
"REMIC V": The segregated pool of assets consisting of all of the
Class P Interest conveyed in trust to the Trustee, for the benefit of the
Holders of the Regular Certificates and the Class R-X Certificate (in respect of
the Class R-V Interest), pursuant to Article II hereunder, and all amounts
deposited therein, with respect to which a separate REMIC election is to be
made.
"REMIC Provisions": Provisions of the federal income tax law
relating to real estate mortgage investment conduits, which appear at Section
860A through 860G of the Code, and related provisions, and proposed, temporary
and final regulations and published rulings, notices and announcements
promulgated thereunder, as the foregoing may be in effect from time to time.
"REMIC Regular Interest": Any REMIC I Regular Interest, REMIC II
Regular Interest, REMIC III Regular Interest, Class CE Certificate or Class P
Certificate.
"REMIC Remittance Rate": The REMIC I Remittance Rate or REMIC II
Remittance Rate.
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"Remittance Report": A report in form and substance that is
acceptable to the Trustee and the NIMS Insurer on a magnetic disk or tape
prepared by the Master Servicer pursuant to Section 4.03 with such additions,
deletions and modifications as agreed to by the Trustee and the Master Servicer.
"Rents from Real Property": With respect to any REO Property, gross
income of the character described in Section 856(d) of the Code as being
included in the term "rents from real property."
"REO Account": Each of the accounts maintained by the Master
Servicer in respect of an REO Property pursuant to Section 3.13 which account
may be the Collection Account subject to Section 3.13.
"REO Disposition": The sale or other disposition of an REO Property
on behalf of REMIC I.
"REO Imputed Interest": As to any REO Property, for any calendar
month during which such REO Property was at any time part of REMIC I, one
month's interest at the applicable Net Mortgage Rate on the Stated Principal
Balance of such REO Property (or, in the case of the first such calendar month,
of the related Mortgage Loan, if appropriate) as of the close of business on the
Distribution Date in such calendar month.
"REO Principal Amortization": With respect to any REO Property, for
any calendar month, the excess, if any, of (a) the aggregate of all amounts
received in respect of such REO Property during such calendar month, whether in
the form of rental income, sale proceeds (including, without limitation, that
portion of the Termination Price paid in connection with a purchase of all of
the Mortgage Loans and REO Properties pursuant to Section 9.01 that is allocable
to such REO Property) or otherwise, net of any portion of such amounts (i)
payable pursuant to Section 3.13(c) in respect of the proper operation,
management and maintenance of such REO Property or (ii) payable or reimbursable
to the Master Servicer pursuant to Section 3.13(d) for unpaid Servicing Fees in
respect of the related Mortgage Loan and unreimbursed Servicing Advances and
Advances in respect of such REO Property or the related Mortgage Loan, over (b)
the REO Imputed Interest in respect of such REO Property for such calendar
month.
"REO Property": A Mortgaged Property acquired by the Master Servicer
on behalf of REMIC I through foreclosure or deed-in-lieu of foreclosure, as
described in Section 3.13.
"Representative": Citigroup Global Markets Inc.
"Request for Release": A release signed by a Servicing Officer, in
the form of Exhibit E attached hereto.
"Reserve Interest Rate": With respect to any Interest Determination
Date, the rate per annum that the Trustee determines to be either (i) the
arithmetic mean (rounded upwards if necessary to the nearest whole multiple of
1/16%) of the one-month U.S. dollar lending rates which New York City banks
selected by the Trustee are quoting on the relevant Interest Determination Date
57
to the principal London offices of leading banks in the London interbank market
or (ii) in the event that the Trustee can determine no such arithmetic mean, the
lowest one-month U.S. dollar lending rate which New York City banks selected by
the Trustee are quoting on such Interest Determination Date to leading European
banks.
"Residential Dwelling": Any one of the following: (i) an attached or
detached one- family dwelling, (ii) a detached two- to four-family dwelling,
(iii) a one-family dwelling unit in a condominium project or (iv) a detached or
attached one-family dwelling in a planned unit development, none of which is a
co-operative, mobile or manufactured home (unless such mobile or manufactured
home is defined as real property under applicable state law).
"Residual Certificate": Any one of the Class R Certificates and the
Class R-X Certificates.
"Residual Interest": The sole class of "residual interests" in a
REMIC within the meaning of Section 860G(a)(2) of the Code.
"Responsible Officer": When used with respect to the Trustee, any
director, any vice president, any assistant vice president, any associate, any
assistant secretary, any trust officer or any other officer of the Trustee,
customarily performing functions similar to those performed by any of the above
designated officers and, with respect to a particular matter, to whom such
matter is referred because of such officer's knowledge of and familiarity with
the particular subject.
"Scheduled Principal Balance": With respect to any Mortgage Loan:
(a) as of the Cut-off Date (or the related Subsequent Cut-off Date with respect
to a Subsequent Mortgage Loan), the outstanding Stated Principal Balance of such
Mortgage Loan as of such date, net of the principal portion of all unpaid
Monthly Payments, if any, due on or before such date; (b) as of any Due Date
subsequent to the Cut-off Date up to and including the Due Date in the calendar
month in which a Liquidation Event occurs with respect to such Mortgage Loan,
the Scheduled Principal Balance of such Mortgage Loan as of the Cut-off Date,
minus the sum of (i) the principal portion of each Monthly Payment due on or
before such Due Date but subsequent to the Cut-off Date, whether or not
received, (ii) all Principal Prepayments received before such Due Date but after
the Cut-off Date, (iii) the principal portion of all Liquidation Proceeds and
Insurance Proceeds received before such Due Date but after the Cut-off Date, net
of any portion thereof that represents principal due (without regard to any
acceleration of payments under the related Mortgage and Mortgage Note) on a Due
Date occurring on or before the date on which such proceeds were received and
(iv) any Realized Loss incurred with respect thereto as a result of a Deficient
Valuation occurring before such Due Date, but only to the extent such Realized
Loss represents a reduction in the portion of principal of such Mortgage Loan
not yet due (without regard to any acceleration of payments under the related
Mortgage and Mortgage Note) as of the date of such Deficient Valuation; and (c)
as of any Due Date subsequent to the occurrence of a Liquidation Event with
respect to such Mortgage Loan, zero. With respect to any REO Property: (a) as of
any Due Date subsequent to the date of its acquisition on behalf of the Trust
Fund up to and including the Due Date in the calendar month in which a
Liquidation Event occurs with respect to such REO Property, an amount (not less
than zero) equal to the Scheduled Principal Balance of the related Mortgage Loan
as of the Due Date in the calendar month in which such REO Property was
acquired, minus the aggregate amount of REO Principal
58
Amortization, if any, in respect of such REO Property for all previously ended
calendar months; and (b) as of any Due Date subsequent to the occurrence of a
Liquidation Event with respect to such REO Property, zero.
"Seller": Ameriquest Mortgage Company, or its successor in interest,
in its capacity as seller under the Mortgage Loan Purchase Agreement.
"Senior Group I Principal Distribution Amount" With respect to any
Distribution Date, an amount, not less than zero, equal to the excess of (x) the
Certificate Principal Balance of the Group I Certificates immediately prior to
such Distribution Date over (y) the lesser of (A) the product of (i) 56.00% and
(ii) the aggregate Stated Principal Balance of the Group I Mortgage Loans as of
the last day of the related Due Period (after giving effect to scheduled
payments of principal due during the related Due Period, to the extent received
or advanced, and unscheduled collections of principal received during the
related Prepayment Period) and (B) the aggregate Stated Principal Balance of the
Group I Mortgage Loans as of the last day of the related Due Period (after
giving effect to scheduled payments of principal due during the related Due
Period, to the extent received or advanced, and unscheduled collections of
principal received during the related Prepayment Period) minus $3,978,881.
"Senior Group II Principal Distribution Amount" With respect to any
Distribution Date, an amount, not less than zero, equal to the excess of (x) the
aggregate Certificate Principal Balance of the Group II Certificates immediately
prior to such Distribution Date over (y) the lesser of (A) the product of (i)
56.00% and (ii) the aggregate Stated Principal Balance of the Group II Mortgage
Loans as of the last day of the related Due Period (after giving effect to
scheduled payments of principal due during the related Due Period, to the extent
received or advanced, and unscheduled collections of principal received during
the related Prepayment Period) and (B) the aggregate Stated Principal Balance of
the Group II Mortgage Loans as of the last day of the related Due Period (after
giving effect to scheduled payments of principal due during the related Due
Period, to the extent received or advanced, and unscheduled collections of
principal received during the related Prepayment Period) minus $1,021,120.
"Senior Interest Distribution Amount": With respect to any
Distribution Date, an amount equal to the sum of (i) the Interest Distribution
Amount for such Distribution Date for the Class A Certificates and (ii) the
Interest Carry Forward Amount with respect to the Class A Certificates.
"Servicing Advances": The reasonable "out-of-pocket" costs and
expenses incurred by the Master Servicer in connection with a default,
delinquency or other unanticipated event by the Master Servicer in the
performance of its servicing obligations, including, but not limited to, the
cost of (i) the preservation, restoration and protection of a Mortgaged
Property, (ii) any enforcement or judicial proceedings, including foreclosures,
in respect of a particular Mortgage Loan, (iii) the management (including
reasonable fees in connection therewith) and liquidation of any REO Property and
(iv) the performance of its obligations under Section 3.01, Section 3.04(d),
Section 3.08, Section 3.12 and Section 3.13. The Master Servicer shall not be
required to make any Servicing Advance in respect of a Mortgage Loan or REO
Property that, in the good faith business
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judgment of the Master Servicer, would not be ultimately recoverable from
related Insurance Proceeds or Liquidation Proceeds on such Mortgage Loan or REO
Property as provided herein.
"Servicing Fee": With respect to each Mortgage Loan and for any
calendar month, an amount equal to one month's interest (or in the event of any
payment of interest which accompanies a Principal Prepayment in full made by the
Mortgagor during such calendar month, interest for the number of days covered by
such payment of interest) at the applicable Servicing Fee Rate on the same
principal amount on which interest on such Mortgage Loan accrues for such
calendar month. A portion of such Servicing Fee may be retained by any
Sub-Servicer as its servicing compensation.
"Servicing Fee Rate": 0.50% per annum.
"Servicing Officer": Any employee of the Master Servicer involved
in, or responsible for, the administration and servicing of the Mortgage Loans,
whose name and specimen signature appear on a list of Servicing Officers
furnished by the Master Servicer to the Trustee and the Depositor on the Closing
Date, as such list may from time to time be amended.
"Servicing Rights Pledgee": In the event that the Special
Sub-Servicer is designated as the successor Master Servicer pursuant to Section
7.02(a), one or more lenders, selected by the Special Sub-Servicer (in its
capacity as successor Master Servicer), to which the Special Sub-Servicer (in
its capacity as successor Master Servicer) will pledge and assign all of its
right, title and interest in, to and under this Agreement, including Wachovia
Bank, National Association, as the representative of certain lenders.
"Servicing Standard": The standards set forth in the first paragraph
of Section 3.01.
"Single Certificate": With respect to any Class of Certificates
(other than the Class P Certificates and the Residual Certificates), a
hypothetical Certificate of such Class evidencing a Percentage Interest for such
Class corresponding to an initial Certificate Principal Balance or Notional
Amount of $1,000. With respect to the Class P Certificates and the Residual
Certificates, a hypothetical Certificate of such Class evidencing a 20%
Percentage Interest in such Class.
"Special Sub-Servicer": Xxxxxx Loan Servicing LP, a Delaware limited
partnership, in its capacity as Special Sub-Servicer of the Specially Serviced
Mortgage Loans.
"Specially Serviced Mortgage Loan": As defined in the Special
Sub-Servicing Agreement.
"Special Sub-Servicing Agreement": The Special Sub-Servicing
Agreement, dated the Closing Date, between the Master Servicer and the Special
Sub-Servicer, as acknowledged by Credit-Based Asset Servicing and Securitization
LLC and the Trustee, regarding the servicing of the Specially Serviced Mortgage
Loans by the Special Sub-Servicer, substantially in the form attached hereto as
Exhibit N.
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"S&P": Standard & Poor's Ratings Services, a division of The
XxXxxx-Xxxx Companies, Inc., or its successor in interest.
"Startup Day": With respect to each Trust REMIC, the day designated
as such pursuant to Section 10.01(b) hereof.
"Stated Principal Balance": With respect to any Mortgage Loan: (a)
as of any date of determination up to but not including the Distribution Date on
which the proceeds, if any, of a Liquidation Event with respect to such Mortgage
Loan would be distributed, the outstanding principal balance of such Mortgage
Loan as of the Cut-off Date (or the related Subsequent Cut-off Date with respect
to a Subsequent Mortgage Loan), as shown in the Mortgage Loan Schedule, minus
the sum of (i) the principal portion of each Monthly Payment due on a Due Date
subsequent to the Cut-off Date, to the extent received from the Mortgagor or
advanced by the Master Servicer and distributed pursuant to Section 4.01 on or
before such date of determination, (ii) all Principal Prepayments received after
the Cut-off Date, to the extent distributed pursuant to Section 4.01 on or
before such date of determination, (iii) all Liquidation Proceeds and Insurance
Proceeds applied by the Master Servicer as recoveries of principal in accordance
with the provisions of Section 3.12, to the extent distributed pursuant to
Section 4.01 on or before such date of determination and (iv) any Realized Loss
incurred with respect thereto as a result of a Deficient Valuation made during
or prior to the Prepayment Period for the most recent Distribution Date
coinciding with or preceding such date of determination; and (b) as of any date
of determination coinciding with or subsequent to the Distribution Date on which
the proceeds, if any, of a Liquidation Event with respect to such Mortgage Loan
would be distributed, zero. With respect to any REO Property: (a) as of any date
of determination up to but not including the Distribution Date on which the
proceeds, if any, of a Liquidation Event with respect to such REO Property would
be distributed, an amount (not less than zero) equal to the Stated Principal
Balance of the related Mortgage Loan as of the date on which such REO Property
was acquired on behalf of REMIC I, minus the sum of (i) if such REO Property was
acquired before the Distribution Date in any calendar month, the principal
portion of the Monthly Payment due on the Due Date in the calendar month of
acquisition, to the extent advanced by the Master Servicer and distributed
pursuant to Section 4.01 on or before such date of determination, and (ii) the
aggregate amount of REO Principal Amortization in respect of such REO Property
for all previously ended calendar months, to the extent distributed pursuant to
Section 4.01 on or before such date of determination; and (b) as of any date of
determination coinciding with or subsequent to the Distribution Date on which
the proceeds, if any, of a Liquidation Event with respect to such REO Property
would be distributed, zero.
"Stayed Funds": If the Master Servicer is the subject of a
proceeding under the federal Bankruptcy Code and the making of a Remittance (as
defined in Section 7.02(b)) is prohibited by Section 362 of the federal
Bankruptcy Code, funds that are in the custody of the Master Servicer, a trustee
in bankruptcy or a federal bankruptcy court and should have been the subject of
such Remittance absent such prohibition.
"Stepdown Date": The earlier to occur of (i) the first Distribution
Date on which the aggregate Certificate Principal Balance of the Class A
Certificates has been reduced to zero and (ii) the later to occur of (a) the
Distribution Date occurring in June 2007 and (b) the first Distribution Date on
which the Credit Enhancement Percentage for the Class A Certificates (calculated
for this
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purpose only after taking into account distributions of principal on the
Mortgage Loans but prior to any distribution of the Group I Principal
Distribution Amount and the Group II Principal Distribution Amount to the
Certificates then entitled to distributions of principal on such Distribution
Date) is equal to or greater than 44.00%.
"Subsequent Recoveries": As of any Distribution Date, unanticipated
amounts received by the Master Servicer (net of any related expenses permitted
to be reimbursed pursuant to Section 3.05) specifically related to a Mortgage
Loan that was the subject of a liquidation or an REO Disposition prior to the
related Prepayment Period that resulted in a Realized Loss.
"Sub-Servicer": Any Person with which the Master Servicer has
entered into a Sub- Servicing Agreement and which meets the qualifications of a
Sub-Servicer pursuant to Section 6.06.
"Sub-Servicing Account": An account established by a Sub-Servicer
which meets the requirements set forth in Section 6.11 and is otherwise
acceptable to the Master Servicer.
"Sub-Servicing Agreement": The written contract between the Master
Servicer and a Sub-Servicer relating to servicing and administration of certain
Mortgage Loans as provided in Section 6.06.
"Subsequent Cut-off Date": With respect to those Subsequent Mortgage
Loans sold to the Trust Fund pursuant to a Subsequent Transfer Instrument, the
later of (x) the first day of the month in which the related Subsequent Transfer
Date occurs and (y) the date of origination of such Subsequent Mortgage Loan.
"Subsequent Group I Mortgage Loan": A Subsequent Mortgage Loan to be
included in Loan Group I.
"Subsequent Group II Mortgage Loan": A Subsequent Mortgage Loan to
be included in Loan Group II.
"Subsequent Mortgage Loan": A Mortgage Loan sold by the Depositor to
the Trust Fund pursuant to Section 2.09, such Mortgage Loan being identified on
the Mortgage Loan Schedule attached to a Subsequent Transfer Instrument.
"Subsequent Mortgage Loan Interest": Any amount constituting (i) a
monthly payment of interest received or advanced at the Net Mortgage Rate with
respect to a Subsequent Group I Mortgage Loan during the Due Periods relating to
(a) the first Distribution Date in excess of 6.54% per annum, (b) the second
Distribution Date in excess of 6.54% per annum and (c) the third Distribution
Date in excess of 6.54% per annum and (ii) a monthly payment of interest
received or advanced at the Net Mortgage Rate with respect to a Subsequent Group
II Mortgage Loan during the Due Periods relating to (a) the first Distribution
Date in excess of 6.54% per annum, (b) the second Distribution Date in excess of
0% per annum and (c) the third Distribution Date in excess of 0% per annum. The
Subsequent Mortgage Loan Interest shall be distributable to the Class CE
Certificates. The Subsequent Mortgage Loan Interest shall not be an asset of any
Trust REMIC.
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"Subsequent Mortgage Loan Purchase Agreement": The agreement between
the Depositor and the Seller regarding the transfer of the Subsequent Mortgage
Loans by the Seller to the Depositor.
"Subsequent Transfer Date": With respect to each Subsequent Transfer
Instrument, the date on which the related Subsequent Mortgage Loans are sold to
the Trust Fund.
"Subsequent Transfer Instrument": Each subsequent transfer
instrument, dated as of a Subsequent Transfer Date, executed by the Trustee and
the Depositor substantially in the form of Exhibit L, by which Subsequent
Mortgage Loans are sold to the Trust Fund.
"Substitution Shortfall Amount": As defined in Section 2.03(d).
"Tax Returns": The federal income tax return on Internal Revenue
Service Form 1066, U.S. Real Estate Mortgage Investment Conduit Income Tax
Return, including Schedule Q thereto, Quarterly Notice to Residual Interest
Holders of REMIC Taxable Income or Net Loss Allocation, or any successor forms,
to be filed on behalf of each REMIC in the Trust Fund due to its classification
as a REMIC under the REMIC Provisions, together with any and all other
information reports or returns that may be required to be furnished to the
Certificateholders or filed with the Internal Revenue Service or any other
governmental taxing authority under any applicable provisions of federal, state
or local tax laws.
"Telerate Page 3750": The display designated as page "3750" on
Moneyline Telerate (or such other page as may replace page 3750 on that report
for the purpose of displaying London interbank offered rates of major banks).
"Termination Price": As defined in Section 9.01.
"Terminator": As defined in Section 9.01.
"Transfer": Any direct or indirect transfer, sale, pledge,
hypothecation, or other form of assignment of any Ownership Interest in a
Certificate.
"Transferee": Any Person who is acquiring by Transfer any Ownership
Interest in a Certificate.
"Transferor": Any Person who is disposing by Transfer of any
Ownership Interest in a Certificate.
"Trigger Event": A Trigger Event has occurred with respect to a
Distribution Date on or after the Stepdown Date if:
(a) the Delinquency Percentage for the Mortgage Loans, exceeds the
applicable percentages of the Credit Enhancement Percentage for the prior
Distribution Date as set forth below for the most senior Class of Class A
Certificates and Mezzanine Certificates then outstanding:
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Class Percentage
----- ----------
Class A Certificates 36.36%
Class M-1 Certificates 44.44%
Class M-2 Certificates 54.24%
Class M-3 Certificates 62.75%
Class M-4 Certificates 68.09%
Class M-5 Certificates 89.39%
Class M-6 Certificates 103.90%
Class M-7 Certificates 121.21%
Class M-8 Certificates 142.86%
Class M-9 Certificates 181.82%
Class M-10 Certificates 271.19%
or
(b) the Cumulative Loss Percentage exceeds the applicable
percentages set forth below with respect to such Distribution Date:
Distribution Date Occurring In Percentage
------------------------------ ----------
June 2007 through May 2008 3.00%
June 2008 through May 2009 5.00%
June 2009 through May 2010 6.50%
June 2010 and thereafter 7.25%
"Trust Fund": Collectively, all of the assets of REMIC I, REMIC II,
REMIC III, REMIC IV, REMIC V the Net WAC Rate Carryover Reserve Account, the Cap
Contracts, the Pre- Funding Accounts, the Interest Coverage Account, any
Subsequent Mortgage Loan Interest and the other assets conveyed by the Depositor
to the Trustee pursuant to Section 2.01.
"Trust REMIC": Any of REMIC I, REMIC II, REMIC III, REMIC IV or
REMIC V.
"Trustee": Deutsche Bank National Trust Company, a national banking
association, or its successor in interest, or any successor Trustee appointed as
herein provided.
"Trustee Fee": The amount payable to the Trustee on each
Distribution Date pursuant to Section 8.05 as compensation for all services
rendered by it in the exercise and performance of any of the powers and duties
of the Trustee hereunder, which amount shall equal the Trustee Fee Rate accrued
for one month multiplied by the sum of (i) the aggregate Scheduled Principal
Balance of the Mortgage Loans and any REO Properties as of the second preceding
Due Date (or, in the case of the initial Distribution Date, as of the Cut-off
Date), calculated on the basis of a 360-day year consisting of twelve 30-day
months and (ii) the aggregate of the amounts on deposit in the Pre- Funding
Accounts as of the second preceding Due Date (or, in the case of the initial
Distribution Date, as of the Closing Date).
"Trustee Fee Rate": 0.0022% per annum.
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"Uncertificated Balance": The amount of any REMIC Regular Interest
outstanding as of any date of determination. As of the Closing Date, the
Uncertificated Balance of each REMIC Regular Interest shall equal the amount set
forth in the Preliminary Statement hereto as its initial uncertificated balance.
On each Distribution Date, the Uncertificated Balance of each REMIC Regular
Interest shall be reduced by all distributions of principal made on such REMIC
Regular Interest on such Distribution Date pursuant to Section 4.01 and, if and
to the extent necessary and appropriate, shall be further reduced on such
Distribution Date by Realized Losses as provided in Section 4.04. The
Uncertificated Balance of REMIC II Regular Interest II-LTZZ shall be increased
by interest deferrals as provided in Section 4.01(a)(1). The Uncertificated
Balance of each REMIC Regular Interest shall never be less than zero. With
respect to the Class CE Interest as of any date of determination, an amount
equal to the excess, if any, of (A) the then aggregate Uncertificated Principal
Balances of the REMIC II Regular Interests over (B) the then aggregate
Certificate Principal Balances of the Class A Certificates, Mezzanine
Certificates and the Class P Interest then outstanding.
"Uncertificated Interest": With respect to any REMIC Regular
Interest for any Distribution Date, one month's interest at the REMIC Remittance
Rate applicable to such REMIC Regular Interest for such Distribution Date,
accrued on the Uncertificated Balance thereof immediately prior to such
Distribution Date. Uncertificated Interest in respect of any REMIC Regular
Interest shall accrue on the basis of a 360-day year consisting of twelve 30-day
months. Uncertificated Interest with respect to each Distribution Date, as to
any REMIC Regular Interest, shall be reduced by an amount equal to the sum of
(a) the aggregate Prepayment Interest Shortfall, if any, for such Distribution
Date to the extent not covered by payments pursuant to Section 4.03(e) and (b)
the aggregate amount of any Relief Act Interest Shortfall, if any allocated, in
each case, to such REMIC Regular Interest pursuant to Section 1.02. In addition,
Uncertificated Interest with respect to each Distribution Date, as to any REMIC
Regular Interest shall be reduced by Realized Losses, if any, allocated to such
REMIC Regular Interest pursuant to Section 1.02 and Section 4.04.
"Underwriters": Each of Citigroup Global Markets Inc. and UBS
Securities LLC.
"Underwriters' Exemption": An individual exemption issued by the
United States Department of Labor, as Prohibited Transaction Exemption 90-88, to
Citigroup Global Markets Inc., for specific offerings in which Deutsche Bank
Securities Inc. or any person directly or indirectly, through one or more
intermediaries, controlling, controlled by or under common control with Deutsche
Bank Securities Inc. is an underwriter, placement agent or a manager or
co-manager of the underwriting syndicate or selling group where the trust and
the offered certificates meet specified conditions.
"Uninsured Cause": Any cause of damage to a Mortgaged Property such
that the complete restoration of such property is not fully reimbursable by the
hazard insurance policies required to be maintained pursuant to Section 3.08.
"United States Person": 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, any state thereof or the District of Columbia
(except, in the case of a partnership, to the extent provided in regulations)
provided that, solely for purposes of the restrictions on the transfer of
Residual
65
Certificates, no partnership or other entity treated as a partnership for United
States federal income tax purposes shall be treated as a United States Person
unless all persons that own an interest in such partnership either directly or
through any entity that is not a corporation for United States federal income
tax purposes are required by the applicable operative agreement to be United
States Persons, or an estate whose income is subject to United States federal
income tax regardless of its source, or a trust if a court within the United
States is able to exercise primary supervision over the administration of the
trust and one or more United States persons have the authority to control all
substantial decisions of the trust. To the extent prescribed in regulations by
the Secretary of the Treasury, which have not yet been issued, a trust which was
in existence on August 20, 1996 (other than a trust treated as owned by the
grantor under subpart E of part I of subchapter J of chapter 1 of the Code), and
which was treated as a United States person on August 20, 1996 may elect to
continue to be treated as a United States person notwithstanding the previous
sentence. The term "United States" shall have the meaning set forth in Section
7701 of the Code.
"Value": With respect to any Mortgaged Property, the lesser of (i)
the value thereof as determined by an appraisal made for the originator of the
Mortgage Loan at the time of origination of the Mortgage Loan by an appraiser
who met the minimum requirements of the Financial Institutions Reform, Recovery
and Enforcement Act of 1989, and (ii) the purchase price paid for the related
Mortgaged Property by the Mortgagor with the proceeds of the Mortgage Loan,
provided, however, in the case of a Refinanced Mortgage Loan, such value of the
Mortgaged Property is based solely upon the value determined by an appraisal
made for the originator of such Refinanced Mortgage Loan at the time of
origination of such Refinanced Mortgage Loan by an appraiser who met the minimum
requirements of the Financial Institutions Reform, Recovery and Enforcement Act
of 1989 or, subject to the applicable Originator's underwriting guidelines, an
insured automated valuation model.
"Voting Rights": The portion of the voting rights of all of the
Certificates which is allocated to any Certificate. With respect to any date of
determination, 98% of all Voting Rights shall be allocated among the holders of
the Class A Certificates, the Mezzanine Certificates and the Class CE
Certificates in proportion to the then outstanding Certificate Principal
Balances of their respective Certificates, 1% of all Voting Rights shall be
allocated to the holders of the Class P Certificates and 1% of all Voting Rights
shall be allocated among the holders of the Residual Certificates. The Voting
Rights allocated to each Class of Certificate shall be allocated among Holders
of each such Class in accordance with their respective Percentage Interests as
of the most recent Record Date.
SECTION 1.02. Allocation of Certain Interest Shortfalls.
For purposes of calculating the amount of Accrued Certificate
Interest and the amount of the Interest Distribution Amount for the Class A
Certificates, the Mezzanine Certificates and the Class CE Certificates for any
Distribution Date, the aggregate amount of any Prepayment Interest Shortfalls
(to the extent not covered by payments by the Master Servicer pursuant to
Section 4.03(e)) and any Relief Act Interest Shortfall incurred in respect of
the Mortgage Loans for any Distribution Date shall be allocated first, to reduce
the interest accrued on the Class CE Certificates to the extent of one month's
interest at the applicable Pass-Through Rate on the Notional Amount of such
Certificate and thereafter, among the Class A Certificates and the Mezzanine
Certificates on a pro
66
rata basis based on, and to the extent of, one month's interest at the then
applicable respective Pass- Through Rate on the respective Certificate Principal
Balance of each such Certificate.
For purposes of calculating the amount of Uncertificated Interest
for the REMIC I Regular Interests for any Distribution Date, the aggregate
amount of any Prepayment Interest Shortfalls (to the extent not covered by
payments by the Master Servicer pursuant to Section 4.03(e)) and Relief Act
Interest Shortfalls incurred in respect of the Mortgage Loans for any
Distribution Date shall be allocated first, (a) with respect to the Group I
Mortgage Loans, to REMIC I Regular Interest I-LT1 and REMIC I Regular Interest
I-LT1PF, in each case to the extent of one month's interest at the then
applicable respective REMIC I Remittance Rate on the respective Uncertificated
Balance of each such REMIC I Regular Interest; provided, however, with respect
to the first three Distribution Dates, such amounts relating to the Initial
Group I Mortgage Loans shall be allocated to REMIC I Regular Interest I-LT1 and
such amounts relating to the Subsequent Group I Mortgage Loans shall be
allocated to REMIC I Regular Interest I-LT1PF, and (b) with respect to the Group
II Mortgage Loans, to REMIC I Regular Interest I-LT2 and REMIC I Regular
Interest I-LT2PF, in each case to the extent of one month's interest at the then
applicable respective REMIC I Remittance Rate on the respective Uncertificated
Balance of each such REMIC I Regular Interest; provided, however, with respect
to the first three Distribution Dates, such amounts relating to the Initial
Group I Mortgage Loans shall be allocated to REMIC I Regular Interest I-LT2 and
such amounts relating to the Subsequent Group II Mortgage Loans shall be
allocated to REMIC I Regular Interest I-LT2PF.
For purposes of calculating the amount of Uncertificated Interest
for the REMIC II Regular Interests for any Distribution Date:
(A) The REMIC II Marker Allocation Percentage of the aggregate
amount of any Prepayment Interest Shortfalls (to the extent not covered by
payments by the Master Servicer pursuant to Section 4.03(e)) and the REMIC
II Marker Allocation Percentage of any Relief Act Interest Shortfalls
incurred in respect of the Mortgage Loans for any Distribution Date shall
be allocated first, to Uncertificated Interest payable to REMIC II Regular
Interest II- LTAA and REMIC II Regular Interest II-LTZZ up to an aggregate
amount equal to the REMIC III Interest Loss Allocation Amount, 98% and 2%,
respectively, and thereafter among REMIC II Regular Interest II-LTA1,
REMIC II Regular Interest II-LTA2, REMIC II Regular Interest II-LTA3,
REMIC II Regular Interest II-LTA4, REMIC II Regular Interest II-LTA5,
REMIC II Regular Interest II-LTM1, REMIC II Regular Interest II-LTM2,
REMIC II Regular Interest II-LTM3, REMIC II Regular Interest II-LTM4,
REMIC II Regular Interest II-LTM5, REMIC II Regular Interest II-LTM6,
REMIC II Regular Interest II-LTM7, REMIC II Regular Interest II-LTM8,
REMIC II Regular Interest II-LTM9, REMIC II Regular Interest II-LTM10 and
REMIC II Regular Interest II-LTZZ, pro rata based on, and to the extent
of, one month's interest at the then applicable respective REMIC II
Remittance Rate on the respective Uncertificated Balance of each such
REMIC II Regular Interest; and
(B) The REMIC II Sub WAC Allocation Percentage of the aggregate
amount of any Prepayment Interest Shortfalls (to the extent not covered by
payments by the Master Servicer pursuant to Section 4.03(e)) and the REMIC
II Sub WAC Allocation Percentage of any Relief Act Interest Shortfalls
incurred in respect of the Mortgage Loans for any Distribution Date shall
be allocated to Uncertificated Interest payable to REMIC II Regular
67
Interest II-LT1SUB, REMIC II Regular Interest II-LT1GRP, REMIC II Regular
Interest II- LT2SUB, REMIC II Regular Interest II-LT2GRP and REMIC II
Regular Interest II-LTXX, pro rata based on, and to the extent of, one
month's interest at the then applicable respective REMIC II Remittance
Rate on the respective Uncertificated Balance of each such REMIC II
Regular Interest.
SECTION 1.03 Rights of the NIMS Insurer.
Each of the rights of the NIMS Insurer set forth in this Agreement
shall exist so long as (i) the NIMS Insurer has undertaken to guarantee certain
payments of notes issued pursuant to an Indenture and (ii) any series of notes
issued pursuant to one or more Indentures remain outstanding or the NIMS Insurer
is owed amounts in respect of its guarantee of payment on such notes; provided,
however, the NIMS Insurer shall not have any rights hereunder (except pursuant
to Section 11.01 in the case of clause (ii) below) during the period of time, if
any, that (i) the NIMS Insurer has not undertaken to guarantee certain payments
of notes issued pursuant to the Indenture or (ii) any default has occurred and
is continuing under the insurance policy issued by the NIMS Insurer with respect
to such notes.
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
SECTION 2.01. Conveyance of Mortgage Loans.
The Depositor, concurrently with the execution and delivery hereof,
does hereby transfer, assign, set over and otherwise convey to the Trustee
without recourse for the benefit of the Certificateholders all the right, title
and interest of the Depositor, including any security interest therein for the
benefit of the Depositor, in and to the Mortgage Loans identified on the
Mortgage Loan Schedule, the rights of the Depositor under the Mortgage Loan
Purchase Agreement, all other assets included or to be included in REMIC I and
the Cap Contracts. Such assignment includes all interest and principal received
by the Depositor or the Master Servicer on or with respect to the Mortgage Loans
(other than payments of principal and interest due on such Mortgage Loans on or
before the Cut-off Date). The Depositor herewith delivers to the Trustee and the
Special Sub- Servicer an executed copy of the Mortgage Loan Purchase Agreement
and to the Trustee the Original Pre-Funded Amounts and the required deposit to
the Interest Coverage Account and the Trustee, on behalf of the
Certificateholders, acknowledges receipt of the same.
In connection with such transfer and assignment, the Depositor does
hereby deliver to, and deposit with, the Trustee the following documents or
instruments with respect to each Initial Mortgage Loan so transferred and
assigned, and the Depositor shall, in accordance with Section 2.09, deliver or
cause to be delivered to the Trustee, with respect to each Subsequent Mortgage
Loan, the following documents or instruments (a "Mortgage File"):
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(i) the original Mortgage Note, endorsed in blank, without recourse,
or in the following form: "Pay to the order of Deutsche Bank National
Trust Company, as Trustee under the applicable agreement, without
recourse," with all prior and intervening endorsements showing a complete
chain of endorsement from the originator to the Person so endorsing to the
Trustee, or with respect to any lost Mortgage Note, an original Lost Note
Affidavit; provided however, that such substitutions of Lost Note
Affidavits for original Mortgage Notes may occur only with respect to
Mortgage Loans, the aggregate Cut-off Date Principal Balance of which is
less than or equal to 2.00% of the Pool Balance as of the Cut- off Date;
(ii) the original Mortgage with evidence of recording thereon, and a
copy, certified by the appropriate recording office, of the recorded power
of attorney, if the Mortgage was executed pursuant to a power of attorney,
with evidence of recording thereon;
(iii) an original Assignment of the Mortgage assigned in blank,
without recourse;
(iv) the original recorded intervening Assignment or Assignments of
the Mortgage showing a complete chain of assignment from the originator to
the Person assigning the Mortgage to the Trustee as contemplated by the
immediately preceding clause (iii) or the original unrecorded intervening
Assignments;
(v) the original or copies of each assumption, modification, written
assurance or substitution agreement, if any; and
(vi) the original lenders's title insurance policy or an attorney's
opinion of title or similar guarantee of title acceptable to mortgage
lenders generally in the jurisdiction where the Mortgaged Property is
located, together with all endorsements or riders which were issued with
or subsequent to the issuance of such policy, or in the event such
original title policy is unavailable, a written commitment or uniform
binder or preliminary report of title issued by the title insurance or
escrow company.
If any of the documents referred to in Sections 2.01(ii), (iii) or
(iv) above has as of the Closing Date (or the related Subsequent Transfer Date,
with respect to the Subsequent Mortgage Loans) been submitted for recording but
either (x) has not been returned from the applicable public recording office or
(y) has been lost or such public recording office has retained the original of
such document, the obligations of the Depositor to deliver such documents shall
be deemed to be satisfied upon (1) delivery to the Trustee, or to the
appropriate Custodian on behalf of the Trustee, of a copy of each such document
certified by the applicable Originator in the case of (x) above or the
applicable public recording office in the case of (y) above to be a true and
complete copy of the original that was submitted for recording and (2) if such
copy is certified by the applicable Originator, delivery to the Trustee, or to
the appropriate Custodian on behalf of the Trustee, promptly upon receipt
thereof of either the original or a copy of such document certified by the
applicable public recording office to be a true and complete copy of the
original. If the original lender's title insurance policy was not delivered
pursuant to Section 2.01(vi) above, the Depositor shall deliver or cause to be
delivered to the Trustee, or to the appropriate Custodian on behalf of the
Trustee, promptly after receipt thereof, the original lender's title insurance
policy. The Depositor shall deliver
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or cause to be delivered to the Trustee, or to the appropriate Custodian on
behalf of the Trustee, promptly upon receipt thereof any other original
documents constituting a part of a Mortgage File received with respect to any
Mortgage Loan, including, but not limited to, any original documents evidencing
an assumption or modification of any Mortgage Loan.
The Seller shall promptly (and in no event later than thirty (30)
Business Days, subject to extension upon a mutual agreement between the Seller
and the Trustee, following the later of (i) the Closing Date (or the related
Subsequent Transfer Date, with respect to the Subsequent Mortgage Loans), (ii)
the date on which the Seller receives the Assignment from the Custodian and
(iii) the date of receipt by the Seller of the recording information for a
Mortgage) submit or cause to be submitted for recording, at no expense to the
Trust Fund or the Trustee, in the appropriate public office for real property
records, each Assignment referred to in Sections 2.01(iii) and (iv) above and
shall execute each original Assignment referred to in section 2.01(iii) above in
the following form: "Deutsche Bank National Trust Company, as Trustee under the
applicable agreement." In the event that any such Assignment is lost or returned
unrecorded because of a defect therein, the Seller shall promptly prepare or
cause to be prepared a substitute Assignment or cure or cause to be cured such
defect, as the case may be, and thereafter cause each such Assignment to be duly
recorded.
Notwithstanding the foregoing, however, for administrative
convenience and facilitation of servicing and to reduce closing costs, the
Assignments of Mortgage shall not be required to be submitted for recording
(except with respect to any Mortgage Loan located in Maryland) unless such
failure to record would result in a withdrawal or a downgrading by any Rating
Agency of the rating on any Class of Certificates; provided further, however,
each Assignment of Mortgage shall be submitted for recording by the Seller (at
the direction of the Master Servicer) in the manner described above, at no
expense to the Trust Fund or the Trustee, upon the earliest to occur of: (i)
reasonable direction by Holders of Certificates entitled to at least 25% of the
Voting Rights or the NIMS Insurer, (ii) failure of the Master Servicer
Termination Test, (iii) the occurrence of a bankruptcy, insolvency or
foreclosure relating to the Seller, (iv) the occurrence of a servicing transfer
as described in Section 7.02 hereof and (v) if the Seller is not the Master
Servicer and with respect to any one assignment or Mortgage, the occurrence of a
bankruptcy, insolvency or foreclosure relating to the Mortgagor under the
related Mortgage. Notwithstanding the foregoing, if the Master Servicer is
unable to pay the cost of recording the Assignments of Mortgage, such expense
shall be paid by the Trustee and shall be reimbursable to the Trustee as an
Extraordinary Trust Fund Expense.
All original documents relating to the Mortgage Loans that are not
delivered to the Trustee, or to the appropriate Custodian on behalf of the
Trustee, are and shall be held by or on behalf of the Seller, the Depositor or
the Master Servicer, as the case may be, in trust for the benefit of the Trustee
on behalf of the Certificateholders. In the event that any such original
document is required pursuant to the terms of this Section to be a part of a
Mortgage File, such document shall be delivered promptly to the Trustee, or to
the appropriate Custodian on behalf of the Trustee. Any such original document
delivered to or held by the Depositor that is not required pursuant to the terms
of this Section to be a part of a Mortgage File, shall be delivered promptly to
the Master Servicer.
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The parties hereto understand and agree that it is not intended that
any mortgage loan be included in the Trust that is a "High-Cost Home Loan" as
defined by the Home Ownership and Equity Protection Act of 1994 or any other
applicable predatory or abusive lending laws.
SECTION 2.02. Acceptance of REMIC I by the Trustee.
Subject to the provisions of Section 2.01 and subject to any
exceptions noted on the exception report described in the next paragraph below,
the Trustee acknowledges receipt (or, with respect to Mortgage Loans subject to
a Custodial Agreement, receipt by the respective Custodian as the duly appointed
agent of the Trustee) of the documents referred to in Section 2.01 (other than
such documents described in Section 2.01(v)) above and all interests and all
other assets included in the definition of "REMIC I" under clauses (i), (iii),
(iv) and (v) (to the extent of amounts deposited into the Distribution Account)
and declares that it, or such Custodian as its agent, holds and shall hold such
documents and the other documents delivered to it constituting a Mortgage File,
and that it holds or shall hold all such assets and such other assets included
in the definition of "REMIC I" in trust for the exclusive use and benefit of all
present and future Certificateholders.
On or prior to the Closing Date, the Trustee agrees, for the benefit
of the Certificateholders, to execute and deliver (or cause the Custodian to
execute and deliver) to the Depositor and the NIMS Insurer an acknowledgment of
receipt of the Mortgage Note (with any exceptions noted), substantially in the
form attached as Exhibit C-3 hereto.
The Trustee agrees, for the benefit of the Certificateholders, to
review (or cause a Custodian on its behalf to review) each Mortgage Note within
45 days of the Closing Date (or the related Subsequent Transfer Date, with
respect to the Subsequent Mortgage Loans) and to certify in substantially the
form attached hereto as Exhibit C-1 (or cause the Custodian to certify in the
form of the Initial Certification attached to the Custodial Agreement) that, as
to each Mortgage Loan listed in the Mortgage Loan Schedule (other than any
Mortgage Loan paid in full or any Mortgage Loan specifically identified in the
exception report annexed thereto as not being covered by such certification),
(i) all documents constituting part of such Mortgage File (other than such
documents described in Section 2.01(v)) required to be delivered to it pursuant
to this Agreement are in its possession, (ii) such documents have been reviewed
by it or such Custodian and are not mutilated, torn or defaced unless initialed
by the related borrower and relate to such Mortgage Loan, (iii) based on its or
the Custodian's examination and only as to the foregoing, the information set
forth in the Mortgage Loan Schedule that corresponds to items (1) through (3),
(6), (9), (10), (13), (15) and (19) of the definition of "Mortgage Loan
Schedule" accurately reflects information set forth in the Mortgage File. It is
herein acknowledged that, in conducting such review, the Trustee or such
Custodian was under no duty or obligation (i) to inspect, review or examine any
such documents, instruments, certificates or other papers to determine whether
they are genuine, enforceable, or appropriate for the represented purpose or
whether they have actually been recorded or that they are other than what they
purport to be on their face or (ii) to determine whether any Mortgage File
should include any of the documents specified in clause (v) of Section 2.01.
Prior to the first anniversary date of this Agreement the Trustee
shall deliver to the Depositor, the Master Servicer and the NIMS Insurer a final
certification in the form annexed hereto as Exhibit C-2 (or shall cause the
Custodian to deliver to the Trustee, the Depositor, the Master
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Servicer and the NIMS Insurer a final certification in the form attached to the
Custodial Agreement) evidencing the completeness of the Mortgage Files, with any
applicable exceptions noted thereon, with respect to all of the Initial Mortgage
Loans and the Subsequent Mortgage Loans. Upon the request of the Master
Servicer, any exception report related to the final certification shall be
provided in an electronic computer readable format as mutually agreed upon by
the Master Servicer and the Trustee.
If in the process of reviewing the Mortgage Files and making or
preparing, as the case may be, the certifications referred to above, the Trustee
or any Custodian finds any document or documents constituting a part of a
Mortgage File to be missing, mutilated, torn or defaced or does not conform to
the requirements identified above, at the conclusion of its review the Trustee
(or a Custodian on behalf of the Trustee) shall so notify the Depositor, the
NIMS Insurer and the Master Servicer. In addition, upon the discovery by the
Depositor, the NIMS Insurer, the Master Servicer or the Trustee of a breach of
any of the representations and warranties made by the Seller in the Mortgage
Loan Purchase Agreement in respect of any Mortgage Loan which materially
adversely affects such Mortgage Loan or the interests of the related
Certificateholders in such Mortgage Loan, the party discovering such breach
shall give prompt written notice to the other parties.
The Trustee (or a Custodian on behalf of the Trustee) shall, at the
written request and expense of any Certificateholder, Certificate Owner, provide
a written report to such Certificateholder, Certificate Owner, as applicable, of
all Mortgage Files released to the Master Servicer for servicing purposes.
SECTION 2.03. Repurchase or Substitution of Mortgage Loans by the
Seller or the Depositor; Payment of Prepayment Charge
Payment Amounts.
(a) Upon discovery or receipt of notice (including notice under
Section 2.02) of any materially defective document in, or that a document is
missing from, the Mortgage File or of the breach by the Seller of any
representation, warranty or covenant under the Mortgage Loan Purchase Agreement
in respect of any Mortgage Loan which materially adversely affects the value of
such Mortgage Loan or the interest therein of the Certificateholders, the
Trustee shall promptly notify the Seller, the NIMS Insurer and the Master
Servicer of such defect, missing document or breach and request that the Seller
deliver such missing document or cure such defect or breach within 90 days from
the date the Seller was notified of such missing document, defect or breach, and
if the Seller does not deliver such missing document or cure such defect or
breach in all material respects during such period, the Master Servicer (or, in
accordance with Section 6.06(b), the Trustee) shall enforce the obligations of
the Seller under the Mortgage Loan Purchase Agreement to repurchase such
Mortgage Loan from REMIC I at the Purchase Price within 90 days after the date
on which the Seller was notified (subject to Section 2.03(d)) of such missing
document, defect or breach, if and to the extent that the Seller is obligated to
do so under the Mortgage Loan Purchase Agreement. The Purchase Price for the
repurchased Mortgage Loan shall be deposited in the Collection Account, and the
Trustee, upon receipt of written certification from the Master Servicer of such
deposit, shall release to the Seller the related Mortgage File and execute and
deliver such instruments of transfer or assignment, in each case without
recourse, as the Seller shall furnish to it and as shall be necessary to vest in
the Seller any Mortgage Loan released pursuant hereto, and the Trustee shall not
have any
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further responsibility with regard to such Mortgage File. In lieu of
repurchasing any such Mortgage Loan as provided above, if so provided in the
Mortgage Loan Purchase Agreement, the Seller may cause such Mortgage Loan to be
removed from REMIC I (in which case it shall become a Deleted Mortgage Loan) and
substitute one or more Qualified Substitute Mortgage Loans in the manner and
subject to the limitations set forth in Section 2.03(c). It is understood and
agreed that the obligation of the Seller to cure or to repurchase (or to
substitute for) any Mortgage Loan as to which a document is missing, a material
defect in a document exists or as to which such a breach has occurred and is
continuing shall constitute the sole remedy respecting such omission, defect or
breach available to the Trustee on behalf of the Certificateholders.
(b)(i) Promptly upon the earlier of discovery by the Master Servicer
or receipt of notice by the Master Servicer of the breach of any representation,
warranty or covenant of the Master Servicer set forth in Section 2.05 which
materially and adversely affects the interests of the Certificateholders in any
Mortgage Loan, the Master Servicer shall cure such breach in all material
respects.
(ii) Notwithstanding the provisions of Section 2.03(b)(i) above,
(A) [reserved]; and
(B) on the later of (x) the Master Servicer Remittance Date next
following the earlier of discovery by the Master Servicer or receipt of
notice by the Master Servicer of the breach of the covenant made by the
Master Servicer in Section 2.05(viii), which breach materially and
adversely affects the interests of the Holders of the Class P Certificates
to any Prepayment Charge and (y) the Master Servicer Remittance Date next
following the Prepayment Period relating to such a breach, the Master
Servicer shall deposit into the Collection Account, as a Master Servicer
Prepayment Charge Payment Amount, the amount of the waived Prepayment
Charge, but only to the extent required under Section 2.03(b)(iii) below.
(iii) If with respect to any Prepayment Period,
(A) the dollar amount of Prepayment Charges that are the subject of
breaches by the Master Servicer of the covenant made by the Master
Servicer in Section 2.05(viii), which breaches materially and adversely
affect the interests of the Holders of the Class P Certificates to such
Prepayment Charges, exceeds
(B) 5% of the total dollar amount of Prepayment Charges payable by
Mortgagors in connection with Principal Prepayments on the related
Mortgage Loans that occurred during such Prepayment Period,
then the amount required to be paid by the Master Servicer pursuant to Section
2.03(b)(ii)(B) above shall be limited to an amount, that when added to the
amount of Prepayment Charges actually collected by the Master Servicer in
respect of Prepayment Charges relating to Principal Prepayments on the related
Mortgage Loans that occurred during such Prepayment Period, will yield a sum
equal to 95% of the total dollar amount of Prepayment Charges (exclusive of (A)
Prepayment Charges not
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enforced or collected upon because (i) the enforceability thereof shall have
been limited by bankruptcy, insolvency, moratorium, receivership and other
similar laws relating to creditors' rights generally or (ii) the collectability
thereof shall have been limited due to acceleration in connection with a
foreclosure or other involuntary payment and (B) Prepayment Charges waived by
the Master Servicer when such waiver does not breach the covenant set forth in
Section 2.05(viii)) payable by Mortgagors in connection with Principal
Prepayments on the related Mortgage Loans that occurred during such Prepayment
Period.
(c) Any substitution of Qualified Substitute Mortgage Loans for
Deleted Mortgage Loans made pursuant to Section 2.03(a), in the case of the
Seller or Section 2.03(b), in the case of the Depositor, must be effected prior
to the date which is two years after the Startup Day for REMIC I.
As to any Deleted Mortgage Loan for which the Seller or the
Depositor substitutes a Qualified Substitute Mortgage Loan or Loans, such
substitution shall be effected by the Seller or the Depositor, as the case may
be, delivering to the Trustee (or a Custodian on behalf of the Trustee), for
such Qualified Substitute Mortgage Loan or Loans, the Mortgage Note, the
Mortgage, the Assignment to the Trustee, and such other documents and
agreements, with all necessary endorsements thereon, as are required by Section
2.01, together with an Officers' Certificate providing that each such Qualified
Substitute Mortgage Loan satisfies the definition thereof and specifying the
Substitution Shortfall Amount (as described below), if any, in connection with
such substitution. The Trustee (or a Custodian on behalf of the Trustee) shall
acknowledge receipt for such Qualified Substitute Mortgage Loan or Loans and,
within ten Business Days thereafter, review such documents as specified in
Section 2.02 and deliver to the Depositor, the NIMS Insurer, the Trustee and the
Master Servicer, with respect to such Qualified Substitute Mortgage Loan or
Loans, a certification substantially in the form attached hereto as Exhibit C-1,
with any applicable exceptions noted thereon. Within one year of the date of
substitution, the Trustee shall deliver to the Depositor, the NIMS Insurer and
the Master Servicer a certification substantially in the form of Exhibit C-2
hereto with respect to such Qualified Substitute Mortgage Loan or Loans, with
any applicable exceptions noted thereon. Monthly Payments due with respect to
Qualified Substitute Mortgage Loans in the month of substitution are not part of
REMIC I and shall be retained by the Depositor or the Seller, as the case may
be. For the month of substitution, distributions to Certificateholders shall
reflect the Monthly Payment due on such Deleted Mortgage Loan on or before the
Due Date in the month of substitution, and the Depositor or the Seller, as the
case may be, shall thereafter be entitled to retain all amounts subsequently
received in respect of such Deleted Mortgage Loan. The Depositor shall give or
cause to be given written notice to the Certificateholders and the NIMS Insurer
that such substitution has taken place, shall amend the Mortgage Loan Schedule
and, if applicable, the Prepayment Charge Schedule, to reflect the removal of
such Deleted Mortgage Loan from the terms of this Agreement and the substitution
of the Qualified Substitute Mortgage Loan or Loans and shall deliver a copy of
such amended Mortgage Loan Schedule to the Trustee and the NIMS Insurer. Upon
such substitution, such Qualified Substitute Mortgage Loan or Loans shall
constitute part of the Mortgage Pool and shall be subject in all respects to the
terms of this Agreement and, in the case of a substitution effected by the
Seller, the Mortgage Loan Purchase Agreement, including all applicable
representations and warranties thereof.
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For any month in which the Depositor or the Seller substitutes one
or more Qualified Substitute Mortgage Loans for one or more Deleted Mortgage
Loans, the Master Servicer shall determine the amount (the "Substitution
Shortfall Amount"), if any, by which the aggregate Purchase Price of all such
Deleted Mortgage Loans exceeds the aggregate of, as to each such Qualified
Substitute Mortgage Loan, the Scheduled Principal Balance thereof as of the date
of substitution, together with one month's interest on such Scheduled Principal
Balance at the applicable Net Mortgage Rate. On the date of such substitution,
the Depositor or the Seller, as the case may be, shall deliver or cause to be
delivered to the Master Servicer for deposit in the Collection Account an amount
equal to the Substitution Shortfall Amount, if any, and the Trustee, upon
receipt of the related Qualified Substitute Mortgage Loan or Loans and
certification by the Master Servicer of such deposit, shall release to the
Depositor or the Seller, as the case may be, the related Mortgage File or Files
and shall execute and deliver such instruments of transfer or assignment, in
each case without recourse, as the Depositor or the Seller, as the case may be,
shall deliver to it and as shall be necessary to vest therein any Deleted
Mortgage Loan released pursuant hereto.
In addition, the Depositor or the Seller, as the case may be, shall
obtain at its own expense and deliver to the Trustee and the NIMS Insurer an
Opinion of Counsel to the effect that such substitution shall not cause (a) any
federal tax to be imposed on any Trust REMIC, including without limitation, any
federal tax imposed on "prohibited transactions" under Section 860F(a)(1) of the
Code or on "contributions after the startup date" under Section 860G(d)(1) of
the Code, or (b) any Trust REMIC to fail to qualify as a REMIC at any time that
any Certificate is outstanding.
(d) Upon discovery by the Depositor, the NIMS Insurer, the Seller,
the Master Servicer or the Trustee that any Mortgage Loan does not constitute a
"qualified mortgage" within the meaning of Section 860G(a)(3) of the Code, the
party discovering such fact shall within two Business Days give written notice
thereof to the other parties. In connection therewith, the Seller or the
Depositor shall repurchase or, subject to the limitations set forth in Section
2.03(c), substitute one or more Qualified Substitute Mortgage Loans for the
affected Mortgage Loan within 90 days of the earlier of discovery or receipt of
such notice with respect to such affected Mortgage Loan. Such repurchase or
substitution shall be made by the Seller. Any such repurchase or substitution
shall be made in the same manner as set forth in Section 2.03(a). The Trustee
shall reconvey to the Depositor or the Seller, as the case may be, the Mortgage
Loan to be released pursuant hereto in the same manner, and on the same terms
and conditions, as it would a Mortgage Loan repurchased for breach of a
representation or warranty.
SECTION 2.04. [Reserved].
SECTION 2.05. Representations, Warranties and Covenants of the
Master Servicer.
The Master Servicer hereby represents, warrants and covenants to the
Trustee, for the benefit of each of the Trustee, the Certificateholders and to
the Depositor that as of the Closing Date or as of such date specifically
provided herein:
(i) The Master Servicer is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware and
is duly authorized and qualified
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to transact any and all business contemplated by this Agreement to be
conducted by the Master Servicer in any state in which a Mortgaged
Property is located or is otherwise not required under applicable law to
effect such qualification and, in any event, is in compliance with the
doing business laws of any such State, to the extent necessary to ensure
its ability to enforce each Mortgage Loan and to service the Mortgage
Loans in accordance with the terms of this Agreement;
(ii) The Master Servicer has the full corporate power and authority
to service each Mortgage Loan, and to execute, deliver and perform, and to
enter into and consummate the transactions contemplated by this Agreement
and has duly authorized by all necessary corporate action on the part of
the Master Servicer the execution, delivery and performance of this
Agreement; and this Agreement, assuming the due authorization, execution
and delivery thereof by the Depositor and the Trustee, constitutes a
legal, valid and binding obligation of the Master Servicer, enforceable
against the Master Servicer in accordance with its terms, except to the
extent that (a) the enforceability thereof may be limited by bankruptcy,
insolvency, moratorium, receivership and other similar laws relating to
creditors' rights generally and (b) the remedy of specific performance and
injunctive and other forms of equitable relief may be subject to the
equitable defenses and to the discretion of the court before which any
proceeding therefor may be brought;
(iii) The execution and delivery of this Agreement by the Master
Servicer, the servicing of the Mortgage Loans by the Master Servicer
hereunder, the consummation of any other of the transactions herein
contemplated, and the fulfillment of or compliance with the terms hereof
are in the ordinary course of business of the Master Servicer and shall
not (A) result in a breach of any term or provision of the charter or
by-laws of the Master Servicer or (B) conflict with, result in a breach,
violation or acceleration of, or result in a default under, the terms of
any other material agreement or instrument to which the Master Servicer is
a party or by which it may be bound, or any statute, order or regulation
applicable to the Master Servicer of any court, regulatory body,
administrative agency or governmental body having jurisdiction over the
Master Servicer; and the Master Servicer is not a party to, bound by, or
in breach or violation of any indenture or other agreement or instrument,
or subject to or in violation of any statute, order or regulation of any
court, regulatory body, administrative agency or governmental body having
jurisdiction over it, which materially and adversely affects or, to the
Master Servicer's knowledge, would in the future materially and adversely
affect, (x) the ability of the Master Servicer to perform its obligations
under this Agreement or (y) the business, operations, financial condition,
properties or assets of the Master Servicer taken as a whole;
(iv) The Master Servicer is an approved seller/servicer for Xxxxxx
Xxx or Xxxxxxx Mac in good standing and is a HUD approved mortgagee
pursuant to Section 203 and Section 211 of the National Housing Act;
(v) Except as disclosed in the Prospectus Supplement, no litigation
is pending against the Master Servicer that would materially and adversely
affect the execution, delivery or enforceability of this Agreement or the
ability of the Master Servicer to service the
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Mortgage Loans or to perform any of its other obligations hereunder in
accordance with the terms hereof;
(vi) No consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by the Master Servicer of, or compliance by the Master
Servicer with, this Agreement or the consummation of the transactions
contemplated by this Agreement, except for such consents, approvals,
authorizations or orders, if any, that have been obtained prior to the
Closing Date;
(vii) [Reserved];
(viii) The Master Servicer shall not waive any Prepayment Charge or
part of a Prepayment Charge unless, (i) the enforceability thereof shall
have been limited by bankruptcy, insolvency, moratorium, receivership and
other similar laws relating to creditors' rights generally or (ii) the
collectability thereof shall have been limited due to acceleration in
connection with a foreclosure or other involuntary payment or (iii) in the
Master Servicer's reasonable judgment as described in Section 3.01 hereof,
(x) such waiver relates to a default or a reasonably foreseeable default,
(y) such waiver would maximize recovery of total proceeds taking into
account the value of such Prepayment Charge and related Mortgage Loan and
(z) doing so is standard and customary in servicing similar Mortgage Loans
(including any waiver of a Prepayment Charge in connection with a
refinancing of a Mortgage Loan that is related to a default or a
reasonably foreseeable default). In no event shall the Master Servicer
waive a Prepayment Charge in connection with a refinancing of a Mortgage
Loan that is not related to a default or a reasonably foreseeable default;
(ix) The information set forth in the "monthly tape" provided to the
Trustee or any of its affiliates is true and correct in all material
respects;
(x) With respect to each Mortgage Loan, the Assignment is in
recordable form (except that the name of the assignee and the recording
information with respect to such Mortgage Loan is blank);
(xi) The Master Servicer has fully furnished and shall continue to
fully furnish, in accordance with the Fair Credit Reporting Act and its
implementing regulations, accurate and complete information (e.g.,
favorable and unfavorable) on its borrower credit files to Equifax,
Experian and Trans Union Credit Information Company or their successors on
a monthly basis; and
(xii) The Master Servicer shall transmit full-file credit reporting
data for each Mortgage Loan pursuant to Xxxxxx Mae Guide Announcement
95-19 and that for each Mortgage Loan, Master Servicer agrees it shall
report one of the following statuses each month as follows: new
origination, current, delinquent (30-, 60-, 90-days, etc.), foreclosed, or
charged-off.
It is understood and agreed that the representations, warranties and
covenants set forth in this Section 2.05 shall survive delivery of the Mortgage
Files to the Trustee or to a Custodian, as
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the case may be, and shall inure to the benefit of the Trustee, the Depositor
and the Certificateholders. Upon discovery by any of the Depositor, the NIMS
Insurer, the Master Servicer or the Trustee of a breach of any of the foregoing
representations, warranties and covenants which materially and adversely affects
the value of any Mortgage Loan, Prepayment Charge or the interests therein of
the Certificateholders, the party discovering such breach shall give prompt
written notice (but in no event later than two Business Days following such
discovery) to the NIMS Insurer and the Trustee. Subject to Section 7.01, the
obligation of the Master Servicer set forth in Section 2.03(b) to cure breaches
(or in the case of the representations, warranties and covenants set forth in
Section 2.05(vii) and Section 2.05(viii) above, to otherwise remedy such
breaches pursuant to Section 2.03(b)) shall constitute the sole remedies against
the Master Servicer available to the Certificateholders, the Depositor or the
Trustee on behalf of the Certificateholders respecting a breach of the
representations, warranties and covenants contained in this Section 2.05. The
preceding sentence shall not, however, limit any remedies available to the
Certificateholders, the Depositor or the Trustee on behalf of the
Certificateholders, pursuant to the Mortgage Loan Purchase Agreement signed by
the Master Servicer in its capacity as Seller, respecting a breach of the
representations, warranties and covenants of the Master Servicer in its capacity
as Seller.
SECTION 2.06. Issuance of the REMIC I Regular Interests and the
Class R-I Interest.
The Trustee acknowledges the assignment to it of the Mortgage Loans
and the delivery to it of the Mortgage Files, subject to the provisions of
Section 2.01 and Section 2.02, together with the assignment to it of all other
assets included in REMIC I, the receipt of which is hereby acknowledged.
Concurrently with such assignment and delivery and in exchange therefor, the
Trustee, pursuant to the written request of the Depositor executed by an officer
of the Depositor, has executed, authenticated and delivered to or upon the order
of the Depositor, the Class R-I Interest in authorized denominations. The
interests evidenced by the Class R-I Interest, together with the REMIC I Regular
Interests, constitute the entire beneficial ownership interest in REMIC I. The
rights of the Class R Certificateholders and REMIC II (as holder of the REMIC I
Regular Interests) to receive distributions from the proceeds of REMIC I in
respect of the Class R-I Interest and the REMIC I Regular Interests,
respectively, and all ownership interests evidenced or constituted by the Class
R-I Interest and the REMIC I Regular Interests, shall be as set forth in this
Agreement.
SECTION 2.07. Conveyance of the REMIC I Regular Interests; REMIC I,
REMIC II, REMIC III, REMIC IV and REMIC V by the
Trustee by the Trustee.
(a) The Depositor, concurrently with the execution and delivery
hereof, does hereby transfer, assign, set over and otherwise convey in trust to
the Trustee without recourse all the right, title and interest of the Depositor
in and to the assets described in the definition of REMIC I for the benefit of
the holders of the REMIC I Regular Interests (which are uncertificated) and the
Class R Certificates (in respect of the Class R-I Interest). The Trustee
acknowledges receipt of the assets described in the definition of REMIC I and
declares that it holds and shall hold the same in trust for the exclusive use
and benefit of the holders of the REMIC I Regular Interests and the Class R
Certificates (in respect of the Class R-I Interest). The interests evidenced by
the Class R-I Interest,
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together with the REMIC I Regular Interests, constitute the entire beneficial
ownership interest in REMIC I.
(b) The Depositor, concurrently with the execution and delivery
hereof, does hereby transfer, assign, set over and otherwise convey in trust to
the Trustee without recourse all the right, title and interest of the Depositor
in and to the REMIC I Regular Interests (which are uncertificated) for the
benefit of the Holders of the REMIC II Regular Interests and the Class R
Certificates (in respect of the Class R-II Interest). The Trustee acknowledges
receipt of the REMIC I Regular Interests and declares that it holds and shall
hold the same in trust for the exclusive use and benefit of the Holders of the
REMIC II Regular Interests and the Class R Certificates (in respect of the Class
R-II Interest). The interests evidenced by the Class R-II Interest, together
with the constitute the entire beneficial ownership interest in REMIC II.
(c) The Depositor, concurrently with the execution and delivery
hereof, does hereby transfer, assign, set over and otherwise convey in trust to
the Trustee without recourse all the right, title and interest of the Depositor
in and to the REMIC II Regular Interests (which are uncertificated) for the
benefit of the Holders of the REMIC III Regular Interests and the Class R
Certificates (in respect of the Class R-III Interest). The Trustee acknowledges
receipt of the REMIC II Regular Interests and declares that it holds and shall
hold the same in trust for the exclusive use and benefit of the Holders of the
REMIC III Regular Interests and the Class R Certificates (in respect of the
Class R-III Interest). The interests evidenced by the Class R-III Interest,
together with the Regular Certificates (other than the Class CE Certificates and
the Class P Certificates), the Class CE Interest and the Class P Interest,
constitute the entire beneficial ownership interest in REMIC III.
(d) The Depositor, concurrently with the execution and delivery
hereof, does hereby transfer, assign, set over and otherwise convey in trust to
the Trustee without recourse all the right, title and interest of the Depositor
in and to the REMIC III Regular Interests (which are uncertificated) for the
benefit of the Holders of the REMIC IV Regular Interests and the Class R
Certificates (in respect of the Class R-IV Interest). The Trustee acknowledges
receipt of the REMIC II Regular Interests and declares that it holds and shall
hold the same in trust for the exclusive use and benefit of the Holders of the
REMIC IV Regular Interests and the Class R-X Certificates (in respect of the
Class R-III Interest). The interests evidenced by the Class R-IV Interest and
the Class CE Certificates, constitute the entire beneficial ownership interest
in REMIC IV.
(e) The Depositor, concurrently with the execution and delivery
hereof, does hereby transfer, assign, set over and otherwise convey in trust to
the Trustee without recourse all the right, title and interest of the Depositor
in and to the Class P Interest (which is uncertificated) for the benefit of the
Holders of the Class P Certificates and the Class R-X Certificates (in respect
of the Class R-V Interest). The Trustee acknowledges receipt of the Class P
Interest and declares that it holds and shall hold the same in trust for the
exclusive use and benefit of the Holders of the Class P Certificates and the
Class R-X Certificates (in respect of the Class R-V Interest). The interests
evidenced by the Class R-V Interest, together with the Class P Certificates,
constitute the entire beneficial ownership interest in REMIC V.
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SECTION 2.08. Issuance of Class R Certificates and Class R-X
Certificates.
(a) The Trustee acknowledges the assignment to it of the REMIC I
Regular Interests and, concurrently therewith and in exchange therefor, pursuant
to the written request of the Depositor executed by an officer of the Depositor
or the Trustee has executed, authenticated and delivered to or upon the order of
the Depositor, the Class R Certificates in authorized denominations. The
interests evidenced by the Class R Certificates, together with the REMIC I
Regular Interests, the REMIC II Regular Interests the REMIC III Certificates,
the Class CE Interest and the Class P Interest, constitute the entire beneficial
ownership interest in REMIC I, REMIC II and REMIC III.
(b) The Trustee acknowledges the assignment to it of the Class CE
Interest and the Class P Interest and, concurrently therewith and in exchange
therefor, pursuant to the written request of the Depositor executed by an
officer of the Depositor, the Trustee has executed, authenticated and delivered
to or upon the order of the Depositor, the Class R-X Certificates in authorized
denominations. The interests evidenced by the Class R-X Certificates, together
with the Class CE Certificates and the Class P Certificates constitute the
entire beneficial ownership interest in REMIC IV and REMIC V.
SECTION 2.09. Conveyance of the Subsequent Mortgage Loans.
(a) Subject to the conditions set forth in paragraph (b) below, in
consideration of the Trustee's delivery on the Subsequent Transfer Dates to or
upon the order of the Depositor of all or a portion of the balance of funds in
the Pre-Funding Accounts, the Depositor shall on any Subsequent Transfer Date
sell, transfer, assign, set over and convey without recourse to the Trustee for
the benefit of the Trust Fund but subject to the other terms and provisions of
this Agreement all of the right, title and interest of the Depositor in and to
(i) the Subsequent Mortgage Loans identified on the Mortgage Loan Schedule
attached to the related Subsequent Transfer Instrument delivered by the
Depositor on such Subsequent Transfer Date, (ii) principal due and interest
accruing on the Subsequent Mortgage Loans after the related Subsequent Cut-off
Date and (iii) all items with respect to such Subsequent Mortgage Loans to be
delivered pursuant to Section 2.01 and the other items in the related Mortgage
Files; provided, however, that the Depositor reserves and retains all right,
title and interest in and to principal due and interest accruing on the
Subsequent Mortgage Loans on or prior to the related Subsequent Cut-off Date.
The transfer and delivery to the Trustee for deposit in the Mortgage Pool by the
Depositor of the Subsequent Mortgage Loans identified on the Mortgage Loan
Schedule attached to the related Subsequent Transfer Agreement shall be absolute
and is intended by the Depositor, the Master Servicer, the Trustee and the
Certificateholders to constitute and to be treated as a sale of the Subsequent
Mortgage Loans by the Depositor to the Trust Fund. The related Mortgage File for
each Subsequent Mortgage Loan shall be delivered to the Trustee or the Custodian
at least three Business Days prior to the related Subsequent Transfer Date.
The purchase price paid by the Trustee from amounts released from
the Group I Pre-Funding Account or the Group II Pre-Funding Account, as
applicable, shall be one-hundred percent (100%) of the aggregate Stated
Principal Balance of the Subsequent Mortgage Loans so transferred (as identified
on the Mortgage Loan Schedule provided by the Depositor). This Agreement shall
constitute a fixed-price purchase contract in accordance with Section
860G(a)(3)(A)(ii) of the Code.
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(b) The Depositor shall transfer and deliver to the Trustee for
deposit in the Trust Fund the Subsequent Mortgage Loans and the other property
and rights related thereto as described in paragraph (a) above, and the Trustee
shall release funds from the Group I Pre-Funding Account or the Group II
Pre-Funding Account, as applicable, only upon the satisfaction of each of the
following conditions on or prior to the related Subsequent Transfer Date:
(i) the Depositor shall have provided the Trustee and the NIMS
Insurer with a timely Addition Notice;
(ii) the Depositor shall have delivered to the Trustee and the NIMS
Insurer a duly executed Subsequent Transfer Instrument, which shall
include a Mortgage Loan Schedule listing the Subsequent Mortgage Loans,
and the Seller shall have been directed by the Master Servicer to deliver
a computer file containing such Mortgage Loan Schedule to the Trustee and
each Rating Agency at least three Business Days prior to the related
Subsequent Transfer Date;
(iii) as of each Subsequent Transfer Date, as evidenced by delivery
of the Subsequent Transfer Instrument, substantially in the form of
Exhibit L, neither the Depositor nor the Seller shall be insolvent nor
shall it have been rendered insolvent by such transfer nor shall it be
aware of any pending insolvency;
(iv) such sale and transfer shall not result in a material adverse
tax consequence to the Trust Fund or the Certificateholders;
(v) the Funding Period shall not have terminated;
(vi) the Depositor shall not have selected the Subsequent Mortgage
Loans in a manner that it believed to be adverse to the interests of the
Certificateholders;
(vii) the Depositor shall have delivered to the Trustee and the NIMS
Insurer a Subsequent Transfer Instrument confirming the satisfaction of
the conditions precedent specified in this Section 2.09 and, pursuant to
the Subsequent Transfer Instrument, assigned to the Trustee without
recourse for the benefit of the Certificateholders all the right, title
and interest of the Depositor, in, to and under the Subsequent Mortgage
Loan Purchase Agreement, to the extent of the Subsequent Mortgage Loans;
(viii) the Depositor shall have delivered to the Trustee, the
Underwriters and the NIMS Insurer an Opinion of Counsel addressed to the
Trustee, the Underwriters and the Rating Agencies with respect to the
transfer of the Subsequent Mortgage Loans substantially in the form of the
Opinion of Counsel delivered to the Trustee on the Closing Date regarding
the true sale of the Mortgage Loans; and
(ix) the Depositor shall have delivered to the Trustee the consent
of the NIMS Insurer to the transfer of such Subsequent Mortgage Loans.
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(c) The obligation of the Trust Fund to purchase a Subsequent
Mortgage Loan on any Subsequent Transfer Date is subject to the satisfaction of
the conditions set forth in paragraph (d) below and the accuracy of the
following representations and warranties with respect to such Subsequent
Mortgage Loan determined as of the related Subsequent Cut-off Date: (i) the
Subsequent Mortgage Loan may not be 30 or more days delinquent as of the related
Subsequent Cut-off Date; (ii) the remaining term to stated maturity of the
Subsequent Mortgage Loan shall not be less than 174 months and shall not exceed
360 months from its first payment date; (iii) the Subsequent Mortgage Loan may
not provide for negative amortization; (iv) the Subsequent Mortgage Loan shall
not have a Loan-to-Value Ratio greater than 95.00%; (v) the Subsequent Mortgage
Loans shall have, as of the Subsequent Cut-off Date, a weighted average term
since origination not in excess of 5 months; (vi) no Subsequent Mortgage Loan
shall have a Mortgage Rate less than 5.20% or greater than 13.20%; (vii) the
Subsequent Mortgage Loan shall have been serviced by the Master Servicer since
origination or purchased by the Originator in accordance with its underwriting
guidelines; (viii) the Subsequent Mortgage Loan must have a first payment date
occurring on or before July 1, 2004; (ix) the Subsequent Mortgage Loan will have
a Principal Balance no greater than $657,708 and (x) the Subsequent Mortgage
Loan shall have been underwritten in accordance with the criteria set forth
under the section "The Mortgage Pool--Underwriting Standards; Representations"
in the Prospectus Supplement.
(d) Following the purchase of the Subsequent Group I Mortgage Loans,
the Group I Mortgage Loans (including the related Subsequent Group I Mortgage
Loans) shall, as of the related Subsequent Cut-off Date: (i) have a weighted
average original term to stated maturity of not more than 358 months from the
first payment date thereon; (ii) have a weighted average Mortgage Rate of not
less than 7.06% and not more than 7.46%; (iii) have a weighted average
Loan-to-Value Ratio of not more than 84.89%, (iv) have no Mortgage Loan with a
Principal Balance in excess of Xxxxxxx Mac loan limits, (v) consist of Mortgage
Loans with Prepayment Charges representing no less than approximately 79.56% of
the Group I Mortgage Loans and (vi) with respect to the Adjustable-Rate Mortgage
Loans in Loan Group II, have a weighted average Gross Margin of not less than
5.43%, in each case, measured by aggregate Stated Principal Balance of the Group
I Mortgage Loans as of the Cut-off Date or Subsequent Cut-off Date, as
applicable.
Following the purchase of the Subsequent Group II Mortgage Loans,
the Group II Mortgage Loans (including the related Subsequent Group II Mortgage
Loans) shall, as of the related Subsequent Cut-off Date: (i) have a weighted
average original term to stated maturity of not more than 358 months from the
first payment date thereon; (ii) have a weighted average Mortgage Rate of not
less than 6.96% and not more than 7.06%; (iii) have a weighted average
Loan-to-Value Ratio of not more than 82.77%; (iv) have no Mortgage Loan with a
Principal Balance in excess of Xxxxxx Xxx loan limits; (v) consist of Mortgage
Loans with Prepayment Charges representing no less than approximately 79.02% of
the Group II Mortgage Loans; and (vi) with respect to the Adjustable-Rate
Mortgage Loans in Loan Group II, have a weighted average Gross Margin of not
less than 5.66%, in each case, measured by aggregate Stated Principal Balance of
the Group II Mortgage Loans as of the related Cut-off Date or Subsequent Cut-off
Date, as applicable.
(e) Notwithstanding the foregoing, any Subsequent Mortgage Loan may
be rejected by the NIMS Insurer or any Rating Agency if the inclusion of any
such Subsequent Mortgage Loan would adversely affect the ratings of any class of
Certificates. At least one Business
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Day prior to the related Subsequent Transfer Date, the Depositor shall obtain
confirmation from each Rating Agency which Subsequent Mortgage Loans, if any,
shall not be included in the transfer on the related Subsequent Transfer Date
and deliver such confirmation to the Trustee and the Master Servicer; provided,
however, that the Master Servicer shall have delivered to each Rating Agency at
least three Business Days prior to such Subsequent Transfer Date a computer file
reasonably acceptable to each Rating Agency describing the characteristics
specified in paragraphs (c) and (d) above.
ARTICLE III
ADMINISTRATION AND SERVICING
OF THE MORTGAGE LOANS
SECTION 3.01. Master Servicer to Act as Master Servicer.
The Master Servicer shall service and administer the Mortgage Loans
on behalf of the Trustee and in the best interests of and for the benefit of the
Certificateholders (as determined by the Master Servicer in its reasonable
judgment) in accordance with (i) the terms of the respective Mortgage Loans and
any insurance policies related thereto, (ii) all Applicable Regulations, (iii)
the terms of this Agreement, (iv) the Loss Mitigation Action Plan, if
applicable, and (v) to the extent consistent with the preceding requirements, in
the same manner in which it services and administers similar mortgage loans for
its own portfolio, giving due consideration to customary and usual standards of
practice of prudent mortgage lenders and loan servicers administering similar
mortgage loans but without regard to:
(i) any relationship that the Master Servicer, any Sub-Servicer or
any Affiliate of the Master Servicer or any Sub-Servicer may have with the
related Mortgagor;
(ii) the ownership of any Certificate by the Master Servicer or any
Affiliate of the Master Servicer;
(iii) the Master Servicer's obligation to make Advances or Servicing
Advances; or
(iv) the Master Servicer's or any Sub-Servicer's right to receive
compensation for its services hereunder or with respect to any particular
transaction (the "Servicing Standard").
Subject only to the above-described servicing standards and the
terms of this Agreement and of the respective Mortgage Loans, the Master
Servicer shall have full power and authority, acting alone or through
Sub-Servicers as provided in Section 6.06, to do or cause to be done any and all
things in connection with such servicing and administration which it may deem
necessary or desirable. Without limiting the generality of the foregoing, the
Master Servicer in its own name or in the name of a Sub-Servicer is hereby
authorized and empowered by the Trustee, in accordance with the servicing
standards set forth above, (i) to execute and deliver, on behalf of the
Certificateholders and the Trustee, any and all instruments of satisfaction or
cancellation, or of
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partial or full release or discharge, or of forbearance, or of modification and
all other comparable instruments, with respect to the Mortgage Loans and the
Mortgaged Properties, (ii) to institute foreclosure proceedings or obtain a
deed-in-lieu of foreclosure to convert the ownership of such properties, and to
hold or cause to be held title to such properties, in the name of the Trust
Fund, on behalf of the Trustee and the Certificateholders, (iii) to market, sell
and transfer title of REO Properties held in the name of the Trust Fund to third
party purchasers upon terms and conditions the Master Servicer deems reasonable
under the Servicing Standard, (iv) to bring or respond to civil actions or
complaints (in its own name or that of the Trust Fund or the Trustee on behalf
of the Trust Fund) related to any Mortgage Loan, Mortgaged Property or REO
Property held by the Trust Fund and (v) execute any other document necessary or
appropriate to enable the Master Servicer to carry out its servicing and
administrative duties hereunder consistent with the Servicing Standard.
At the written request of the Master Servicer, the Trustee shall
execute and furnish to the Master Servicer such documents as are necessary or
appropriate to enable the Master Servicer to carry out its servicing and
administrative duties hereunder. By execution of this Agreement, the Trustee, on
behalf of the Trust Fund, hereby grants to the Master Servicer a power of
attorney to execute any and all documents necessary to carry out any and all
servicing duties described in this Agreement (including the taking of and
transferring title of REO Properties to third parties held in the name of the
Trustee for the benefit of the Trust) and expressly confirms that this paragraph
along with the face page and a copy of the signature page (duly executed) to
this Agreement shall constitute the power of attorney for evidentiary and/or
recording purposes. The Trustee shall not be liable for the actions of the
Master Servicer or any Sub-Servicers under such powers of attorney.
Subject to Section 3.04(d) hereof, in accordance with the Servicing
Standard, the Master Servicer shall advance or cause to be advanced funds as
necessary for the purpose of effecting the timely payment of taxes and
assessments on the Mortgaged Properties, which advances shall be Servicing
Advances reimbursable in the first instance from related collections from the
Mortgagors pursuant to Section 3.04(d), and further as provided in Section
3.05(a). Any cost incurred by the Master Servicer or by Sub-Servicers in
effecting the timely payment of taxes and assessments on a Mortgaged Property
shall not, for the purpose of calculating distributions to Certificateholders,
be added to the unpaid Stated Principal Balance of the related Mortgage Loan,
notwithstanding that the terms of such Mortgage Loan so permit.
Consistent with the terms of this Agreement, the Master Servicer may
waive, modify or vary any term of any Mortgage Loan or consent to the
postponement of strict compliance with any such term or in any manner grant
indulgence to any Mortgagor if such waiver, modification, postponement or
indulgence is in conformity with the Servicing Standard; provided, however,
that:
(A) the Master Servicer shall not make future advances (except as
provided in Section 4.03);
(B) the Master Servicer shall not permit any modification with
respect to any Mortgage Loan that would change the Mortgage Rate, defer or
forgive the payment of any principal or interest payments, reduce the
outstanding Stated Principal Balance (except for reductions resulting from
actual payments of principal) or extend the final maturity date on such
Mortgage Loan (unless as provided in Section 3.02, (i) the Mortgagor is in
default with
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respect to the Mortgage Loan or (ii) such default is, in the judgment of
the Master Servicer, reasonably foreseeable); and
(C) the Master Servicer shall not consent to (i) partial releases of
Mortgages, (ii) alterations, (iii) removal, demolition or division of
properties subject to Mortgages, (iv) modification or (v) second mortgage
subordination agreements with respect to any Mortgage Loan that would: (i)
affect adversely the status of any Trust REMIC as a REMIC,(ii) cause any
Trust REMIC to be subject to a tax on "prohibited transactions" or
"contributions" pursuant to the REMIC Provisions, or (iii) both (x) effect
an exchange or reissuance of such Mortgage Loan under Section 1001 of the
Code (or Treasury regulations promulgated thereunder) and (y) cause any
Trust REMIC constituting part of the Trust Fund to fail to qualify as a
REMIC under the Code or the imposition of any tax on "prohibited
transactions" or "contributions" after the Startup Day under the REMIC
Provisions.
To the extent consistent with the terms of this Agreement, including
Section 2.03 and Section 2.05, the Master Servicer may waive (or permit a
Sub-Servicer to waive) a Prepayment Charge only under the following
circumstances: (i) such waiver is standard and customary in servicing similar
Mortgage Loans and (ii) such waiver relates to a default or a reasonably
foreseeable default and would, in the reasonable judgment of the Master
Servicer, maximize recovery of total proceeds taking into account the value of
such Prepayment Charge and the related Mortgage Loan.
The Master Servicer may delegate its responsibilities under this
Agreement; provided, however, that no such delegation shall release the Master
Servicer from the responsibilities or liabilities arising under this Agreement.
All references to Master Servicer in this Agreement shall be deemed to include
any Sub-Servicer duly appointed by the Master Servicer pursuant to this
Agreement.
SECTION 3.02. Collection of Certain Mortgage Loan Payments.
The Master Servicer shall make reasonable efforts to collect all
payments called for under the terms and provisions of the Mortgage Loans, and
shall, to the extent such procedures shall be consistent with this Agreement and
the terms and provisions of any applicable insurance policies, follow such
collection procedures as it would follow with respect to mortgage loans
comparable to the Mortgage Loans and held for its own account. Consistent with
the foregoing, the Master Servicer may in its discretion (i) waive any late
payment charge or, if applicable, penalty interest, or (ii) extend the due dates
for the Monthly Payments due on a Mortgage Note for a period of not greater than
180 days; provided that any extension pursuant to clause (ii) above shall not
affect the amortization schedule of any Mortgage Loan for purposes of any
computation hereunder. The NIMS Insurer's prior written consent shall be
required for any modification, waiver or amendment if the aggregate number of
outstanding Mortgage Loans which have been modified, waived or amended exceeds
5% of the number of Mortgage Loans as of the Cut-off Date. In the event of any
such arrangement pursuant to clause (ii) above, the Master Servicer shall make
timely advances on such Mortgage Loan during such extension pursuant to Section
4.03 and in accordance with the amortization schedule of such Mortgage Loan
without modification thereof by reason of such arrangements.
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Notwithstanding the foregoing, in the event that any Mortgage Loan
is in default or, in the judgment of the Master Servicer, such default is
reasonably foreseeable, the Master Servicer, consistent with the Servicing
Standard, may also waive, modify or vary any term of such Mortgage Loan
(including modifications that would change the Mortgage Rate, forgive the
payment of principal or interest or extend the final maturity date of such
Mortgage Loan), accept payment from the related Mortgagor of an amount less than
the Stated Principal Balance in final satisfaction of such Mortgage Loan, or
consent to the postponement of strict compliance with any such term or otherwise
grant indulgence to any Mortgagor (any and all such waivers, modifications,
variances, forgiveness of principal or interest, postponements, or indulgences
collectively referred to herein as "forbearance"), provided, however, that in
determining which course of action permitted by this sentence it shall pursue,
the Master Servicer shall adhere to the Loss Mitigation Action Plan. The Master
Servicer's analysis supporting any forbearance and the conclusion that any
forbearance meets the standards of Section 3.01 and the Loss Mitigation Action
Plan shall be reflected in writing in the Mortgage File.
In the event that a shortfall in any collection on or liability with
respect to any Mortgage Loan results from or is attributable to adjustments to
Mortgage Rates, Monthly Payments or Stated Principal Balances that were made by
the Master Servicer in a manner not consistent with the terms of the related
Mortgage Note and this Agreement, the Master Servicer, upon discovery or receipt
of notice thereof, immediately shall deliver to the Trustee for deposit in the
Distribution Account from its own funds the amount of any such shortfall and
shall indemnify and hold harmless the Trust Fund, the Trustee, the Depositor and
any successor master servicer in respect of any such liability. Such indemnities
shall survive the termination or discharge of this Agreement.
SECTION 3.03. [Reserved].
SECTION 3.04. Collection Account, Escrow Account and Distribution
Account.
(a) Collection Account. On behalf of the Trust Fund, the Master
Servicer shall segregate and hold all funds collected and received pursuant to
each Mortgage Loan separate and apart from any of its own funds and general
assets and shall establish and maintain in the name of the Trustee one or more
accounts (such account or accounts, the "Collection Account") in accordance with
this Section 3.04, held in trust for the benefit of the Trustee and the
Certificateholders.
(b) Deposits to the Collection Account. On behalf of the Trust Fund,
the Master Servicer shall deposit or cause to be deposited in the clearing
account (which account must be an Eligible Account) in which it customarily
deposits payments and collections on mortgage loans in connection with its
mortgage loan servicing activities on a daily basis, and in no event more than
one Business Day after the Master Servicer's receipt thereof, and shall
thereafter deposit in the Collection Account, in no event more than two Business
Days after the deposit of such funds into the clearing account, as and when
received or as otherwise required hereunder, and retain therein, the following
payments and collections received or made by it subsequent to the Cut-off Date
with respect to the Initial Mortgage Loans, or the related Subsequent Cut-off
Date with respect to the Subsequent
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Mortgage Loans, or payments (other than Principal Prepayments) received by it on
or prior to the Cut-off Date but allocable to a Due Period subsequent thereto:
(i) all payments on account of principal, including Principal
Prepayments, on the Mortgage Loans and REO Properties;
(ii) all payments on account of interest on the Mortgage Loans and
REO Properties adjusted to the Net Mortgage Rate;
(iii) all Insurance Proceeds and Liquidation Proceeds (other than
proceeds to be held in the Escrow Account and applied to the restoration
or repair of the Mortgaged Property or released to the Mortgagor in
accordance with the Servicing Standard), Subsequent Recoveries and any
amounts received in respect of the rental of any REO Property prior to REO
Disposition;
(iv) all proceeds related to the purchase, substitution or
repurchase of any Mortgage Loan or REO Property in accordance with Section
2.03;
(v) any amounts required to be deposited by the Master Servicer
pursuant to Section 3.09 in connection with the deductible clause in any
blanket hazard insurance policy, such deposit being made from the Master
Servicer's own funds, without reimbursement therefor;
(vi) any amounts required to be deposited by the Master Servicer
pursuant to Section 3.06 in connection with any losses realized on
Permitted Investments with respect to funds held in the Collection
Account;
(vii) all amounts required to be deposited in connection with
shortfalls in principal amount of Qualified Substitute Mortgage Loans
pursuant to Section 2.03 (for purposes of this clause (vii), the Cut-off
Date with respect to any Qualified Substitute Mortgage Loan shall be
deemed to be the date of substitution);
(viii) any amounts required to be deposited by the Master Servicer
pursuant to Section 4.03(b); and
(ix) all Prepayment Charges collected by the Master Servicer, all
Prepayment Charges payable by the Master Servicer pursuant to Section
2.03(b)(ii)(A) and all Master Servicer Prepayment Charge Payment Amounts
payable by the Master Servicer pursuant to Section 2.03(b)(ii)(B) as
limited by Section 2.03(b)(iii).
The foregoing requirements for deposit to the Collection Account
shall be exclusive, it being understood and agreed that, without limiting the
generality of the foregoing, payments in the nature of late payment charges,
assumption fees, insufficient funds charges, modification fees and other
ancillary fees (but not Prepayment Charges) need not be deposited by the Master
Servicer in the Collection Account and shall upon collection, belong to the
Master Servicer as additional compensation for its servicing activities. In the
event the Master Servicer shall deposit in the
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Collection Account any amount not required to be deposited therein, it may at
any time withdraw such amount from the Collection Account, any provision herein
to the contrary notwithstanding.
(c) Escrow Account. The Master Servicer shall segregate and hold all
funds collected and received pursuant to each Mortgage Loan which constitute
Escrow Payments separate and apart from any of its own funds and general assets
and shall establish and maintain in the name of the Trustee one or more accounts
(such account or accounts, the "Escrow Account") held in trust for the benefit
of the Certificateholders and the Trustee.
(d) Deposits to the Escrow Account. The Master Servicer shall
deposit or cause to be deposited in the clearing account (which account must be
an Eligible Account) in which it customarily deposits payments and collections
on mortgage loans in connection with its mortgage loan servicing activities on a
daily basis, and in no event more than one Business Day after the Master
Servicer's receipt thereof, and shall thereafter deposit in the Escrow Account,
in no event more than two Business Days after the deposit of such funds into the
clearing account, as and when received or as otherwise required hereunder, and
retain therein:
(i) all Escrow Payments collected on account of the Mortgage Loans,
for the purpose of effecting timely payment of any such items as required
under the terms of this Agreement; and
(ii) all Insurance Proceeds which are to be applied to the
restoration or repair of any Mortgaged Property.
(e) Distribution Account. On behalf of the Trust Fund, the Trustee
shall segregate and hold all funds collected and received pursuant to this
Agreement separate and apart from any of its own funds and general assets and
shall establish and maintain in the name of the Trustee one or more segregated
accounts (such account or accounts, the "Distribution Account"), held in trust
for the benefit of the Certificateholders.
(f) Trustee Deposits to the Distribution Account. Upon receipt, the
Trustee shall deposit or cause to be deposited into the Distribution Account all
payments of any nature received from the Master Servicer in accordance with this
Agreement. The Trustee shall deposit in the Distribution Account any amounts
required to be deposited pursuant to Section 3.06 in connection with losses
realized on Permitted Investments with respect to funds held in the Distribution
Account. Furthermore, promptly upon receipt of any Stayed Funds, whether from
the Master Servicer, a trustee in bankruptcy, or federal bankruptcy court or
other source, the Trustee shall deposit such funds in the Distribution Account,
subject to withdrawal thereof pursuant to Section 7.02(b) or as otherwise
permitted hereunder.
(g) Master Servicer Transfer of Funds to the Distribution Account.
On behalf of the Trust Fund, the Master Servicer shall deliver to the Trustee in
immediately available funds for deposit in the Distribution Account by 3:00 p.m.
(New York time) on the Master Servicer Remittance Date, (i) that portion of
Available Funds (calculated without regard to the references in clause (2) of
the definition thereof to amounts that may be withdrawn from the Distribution
Account) for the related Distribution Date then on deposit in the Collection
Account, (ii) without duplication,
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the amount of all Prepayment Charges collected by the Master Servicer, all
Prepayment Charges payable by the Master Servicer pursuant to Section
2.03(b)(ii)(A) and all Master Servicer Prepayment Charge Payment Amounts payable
by the Master Servicer pursuant to Section 2.03(b)(ii)(B), subject to Section
2.03(b)(iii) (in each case to the extent not related to Principal Prepayments
occurring after the related Prepayment Period) and (iii) any amounts
reimbursable to an Advancing Person pursuant to Section 3.23 and the terms of
the related Advance Facility.
In addition, the Master Servicer shall deliver to the Trustee from
time to time as required by this Agreement, for deposit and the Trustee shall so
deposit, in the Distribution Account:
(i) any Advances, as required pursuant to Section 4.03;
(ii) any amounts required to be deposited pursuant to Section 3.13
in connection with any REO Property;
(iii) any amounts to be paid in connection with a purchase of
Mortgage Loans and REO Properties pursuant to Section 3.16 and Section
9.01;
(iv) any Compensating Interest as required pursuant to Section
4.03(e);
(v) any Stayed Funds, as soon as permitted by the federal bankruptcy
court having jurisdiction in such matters;
(vi) any amounts required to be paid by the Master Servicer pursuant
to Section 3.06 in connection with any losses realized on Permitted
Investments with respect to funds held in the Collection Account; and
(v) any amounts required to be paid to the Trustee from the assets
of the Trust Fund on deposit in the Collection Account pursuant to this
Agreement, including but not limited to amounts required to be paid to the
Trustee pursuant to Section 7.02 and Section 8.05.
Funds held in the Collection Account pursuant to Section 3.04(b) may
at any time be delivered by the Master Servicer to the Trustee for deposit into
the Distribution Account and for all purposes of this Agreement shall be deemed
to be a part of the Collection Account until the Business Day prior to the
Distribution Date; provided, however, that the Trustee shall have the sole
authority to withdraw any funds held pursuant to this paragraph. In the event
the Master Servicer shall deliver to the Trustee for deposit in the Distribution
Account any amount not required to be deposited therein, it may at any time
request that the Trustee withdraw such amount from the Distribution Account and
remit to it any such amount, any provision herein to the contrary
notwithstanding.
(h) Investment of Account Funds. Funds on deposit in the Collection
Account, the Distribution Account, any REO Account and any Escrow Account may be
invested in Permitted Investments in accordance with the provisions set forth in
Section 3.06. Any investment earnings or interest paid on funds deposited in the
Collection Account, any REO Account and any Escrow Account (subject to Section
3.05(b)) shall accrue to the benefit of the Master Servicer and the Master
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Servicer shall be entitled to retain and withdraw such interest from each such
account on a daily basis. Any investment earnings or interest paid on funds
deposited in the Distribution Account, shall accrue to the benefit of the
Trustee and the Trustee shall be entitled to retain and withdraw such interest
from each such account on a daily basis.
Funds on deposit in the Pre-Funding Accounts, the Interest Coverage
Account and the Net WAC Rate Reserve Carryover Account may be invested in
Permitted Investments in accordance with Section 3.06 subject to any limitations
set forth in Section 4.07 (with respect to the Pre-Funding Accounts), Section
4.08 (with respect to the Interest Coverage Account) and Section 4.10 (with
respect to the Net WAC Rate Carryover Reserve Account) and any investment
earnings or interest paid shall accrue to the benefit of the party designated in
such section.
(i) Creation, Location and Subsequent Transfers of Accounts. Each
account created pursuant to this Agreement must be an Eligible Account. On or
prior to the Closing Date, the Master Servicer and the Trustee shall give
notice, to each other, the NIMS Insurer and the Depositor of the location of any
account created by it pursuant to this Agreement. From time to time, the Master
Servicer and the Trustee may each transfer any account created by it to a
different depository institution provided that upon such transfer the written
notice is provided to all other parties listed in the preceding sentence.
(j) In order to comply with its duties under the U.S. Patriot Act,
the Trustee shall obtain and verify certain information and documentation from
the owners of the accounts that the Trustee establishes pursuant to this
Agreement including, but not limited to, each account owner's name, address, and
other identifying information.
SECTION 3.05. Permitted Withdrawals From the Collection Account,
Escrow Account and Distribution Account.
(a) Collection Account. The Master Servicer may, from time to time,
withdraw from the Collection Account for the following purposes or as described
in Section 4.03:
(i) to remit to the Trustee for deposit in the Distribution Account
the amounts required to be so remitted pursuant to Section 3.04(g) or
permitted to be so remitted pursuant to the last paragraph of Section
3.04(g);
(ii) subject to Section 3.12(c), to reimburse itself for (a) any
unpaid Servicing Fees, (b) any unreimbursed Servicing Advances and (c) any
unreimbursed Advances, the Master Servicer's right to reimburse itself
pursuant to this subclause (ii) being limited to any Late Collections,
Liquidation Proceeds, Subsequent Recoveries and Insurance Proceeds
received on the related Mortgage Loan and any amounts received in respect
of the rental of the related REO Property prior to an REO Disposition that
represent payments of principal and/or interest respecting which any such
advance was made;
(iii) to reimburse itself for (a) any unpaid Servicing Fees to the
extent not recoverable under Section 3.05(a)(ii) and (b) any unpaid
Advances or Servicing Advances that have been deemed Nonrecoverable
Advances or Nonrecoverable Servicing Advances;
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(iv) to pay to itself any Prepayment Interest Excess;
(v) to reimburse itself for any amounts paid pursuant to Section
3.12(b) (and not otherwise previously reimbursed);
(vi) to pay to itself as servicing compensation any interest earned
on funds in the Collection Account;
(vii) subject to Section 4.03(b), to reimburse the Master Servicer
in respect of any unreimbursed Advances to the extent of funds held in the
Collection Account for future distribution that were not included in
Available Funds for the preceding Distribution Date;
(viii) to reimburse the Master Servicer or the Depositor for
expenses incurred by or reimbursable to the Master Servicer or the
Depositor, as the case may be, pursuant to Section 6.03;
(ix) to remit to the Trustee any amounts that the Trustee is
permitted to be paid or reimbursed from the assets of the Trust Fund
pursuant to the terms of this Agreement, including the terms of Section
7.02(a) and Section 8.05 of this Agreement;
(x) to reimburse the NIMS Insurer, the Master Servicer (if the
Master Servicer is not an Affiliate of the Seller) or the Trustee, as the
case may be, for enforcement expenses reasonably incurred in respect of
the breach or defect giving rise to the purchase obligation under Section
2.03 of this Agreement that were included in the Purchase Price of the
Mortgage Loan, including any expenses arising out of the enforcement of
the purchase obligation;
(xi) to pay to the Master Servicer, the Depositor or the Seller, as
the case may be, with respect to each Mortgage Loan that has previously
been purchased or replaced pursuant to Section 2.03 or Section 3.16(a) all
amounts received thereon subsequent to the date of purchase or
substitution, as the case may be;
(xi) to transfer funds in the Collection Account maintained at a
particular depository to the Collection Account maintained at a different
depository, pursuant to Section 3.04(i); and
(xii) to clear and terminate the Collection Account upon the
termination of this Agreement.
On each Business Day as of the commencement of which the balance on
deposit in the Collection Account exceeds $75,000 following any withdrawals
pursuant to the next succeeding sentence, the amount of such excess shall be
remitted to the Trustee, but only if the Collection Account constitutes an
Eligible Account solely pursuant to clause (ii) of the definition of "Eligible
Account." If the balance on deposit in the Collection Account exceeds $75,000 as
of the commencement of business on any Business Day and the Collection Account
constitutes an Eligible Account solely pursuant to clause (ii) of the definition
of "Eligible Account," the Master Servicer
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shall, on or before 3:00 p.m. New York time on such Business Day, withdraw from
the Collection Account any and all amounts payable or reimbursable to the
Depositor, the Master Servicer, the Trustee or any Sub-Servicer pursuant to
Section 3.05 and shall pay such amounts to the Persons entitled thereto.
The foregoing requirements for withdrawal from the Collection
Account shall be exclusive. In the event the Master Servicer shall deposit in
the Collection Account any amount not required to be deposited therein, it may
at any time withdraw such amount from the Collection Account, any provision
herein to the contrary notwithstanding.
The Master Servicer shall keep and maintain separate accounting, on
a Mortgage Loan by Mortgage Loan basis, for the purpose of justifying any
withdrawal from the Collection Account, to the extent held by or on behalf of
it, pursuant to subclauses (ii), (iii), (iv), (v), (vi), (vii), (viii) and (xi)
above. The Master Servicer shall provide written notification to the Trustee and
the NIMS Insurer on or prior to the next succeeding Master Servicer Reporting
Date, upon making any withdrawals from the Collection Account pursuant to
subclause (viii) above.
(b) Escrow Account. The Master Servicer may, from time to time,
withdraw from the Escrow Account for the following purposes:
(i) to effect payments of ground rents, taxes, assessments, water
rates, hazard insurance premiums and comparable items;
(ii) to reimburse the Master Servicer for any Servicing Advance made
by the Master Servicer with respect to a related Mortgage Loan but only
from amounts received on the related Mortgage Loan which represent late
payments or Late Collections of Escrow Payments thereunder;
(iii) to refund to the Mortgagor any funds as may be determined to
be overages;
(iv) for transfer to the Collection Account in accordance with the
terms of this Agreement;
(v) for application to restoration or repair of the Mortgaged
Property;
(vi) to pay to the Master Servicer, or to the Mortgagor to the
extent required by the related Mortgage Loan or Applicable Regulations,
any interest paid on the funds deposited in the Escrow Account;
(vii) to clear and terminate the Escrow Account on the termination
of this Agreement; and
(viii) to transfer to the Collection Account any Insurance Proceeds.
In the event the Master Servicer shall deposit in an Escrow Account
any amount not required to be deposited therein, it may at any time withdraw
such amount from such Escrow
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Account, any provision herein to the contrary notwithstanding. As part of its
servicing duties, the Master Servicer shall pay to the Mortgagor interest on
funds in the Escrow Account, to the extent required by the related Mortgage Loan
or Applicable Regulations, and to the extent that interest earned on funds in
the Escrow Account is insufficient, shall pay such interest from its own funds,
without any reimbursement therefor. The Master Servicer may pay to itself any
excess interest on funds in the Escrow Account, to the extent such action is in
conformity with the Servicing Standard, is permitted by law and such amounts are
not required to be paid to Mortgagors or used for any of the other purposes set
forth above.
(c) Distribution Account. The Trustee shall, from time to time, make
withdrawals from the Distribution Account, for any of the following purposes:
(i) to make distributions to Certificateholders in accordance with
Section 4.01;
(ii) to pay to itself and the Trustee amounts to which it is
entitled pursuant to Section 8.05;
(iii) to pay itself any interest income earned on funds deposited in
the Distribution Account pursuant to Section 3.06;
(iv) to reimburse itself pursuant to Section 7.01 and Section
7.02(b);
(v) to pay any amounts in respect of taxes pursuant to Section
10.01(g)(iii); and
(vi) to clear and terminate the Distribution Account pursuant to
Section 9.01.
SECTION 3.06. Investment of Funds in the Collection Account, the
Escrow Account, the REO Account and the Distribution
Account.
(a) The Master Servicer may direct any depository institution
maintaining the Collection Account, the Escrow Account (subject to Section
3.05(b)), and the REO Account and the Trustee may direct any depository
institution maintaining the Distribution Account, (for purposes of this Section
3.06, each an "Investment Account"), to invest the funds in such Investment
Account in one or more Permitted Investments bearing interest or sold at a
discount, and maturing, unless payable on demand, (i) no later than the Business
Day immediately preceding the date on which such funds are required to be
withdrawn from such account pursuant to this Agreement, if a Person other than
the Trustee is the obligor thereon, and (ii) no later than the date on which
such funds are required to be withdrawn from such Investment Account pursuant to
this Agreement, if the Trustee is the obligor thereon. All such Permitted
Investments shall be held to maturity, unless payable on demand. Any investment
of funds in an Investment Account shall be made in the name of the Trustee (in
its capacity as such) or in the name of a nominee of the Trustee. The Trustee
shall be entitled to sole possession (except with respect to investment
direction of funds held in the Collection Account, the Escrow Account, and the
REO Account) over each such investment and (except with respect to the income on
funds held in the Collection Account, the Escrow Account and the REO Account)
the income thereon, and any certificate or other instrument evidencing any such
investment shall be delivered directly to the Trustee or its agent, together
with any document of
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transfer necessary to transfer title to such investment to the Trustee or its
nominee. In the event amounts on deposit in an Investment Account are at any
time invested in a Permitted Investment payable on demand, the Trustee shall:
(i) consistent with any notice required to be given thereunder,
demand that payment thereon be made on the last day such Permitted
Investment may otherwise mature hereunder in an amount equal to the lesser
of (1) all amounts then payable thereunder and (2) the amount required to
be withdrawn on such date; and
(ii) demand payment of all amounts due thereunder promptly upon
determination by a Responsible Officer of the Trustee that such Permitted
Investment would not constitute a Permitted Investment in respect of funds
thereafter on deposit in the Investment Account.
(b) All income in the nature of interest from the investment of
funds in the Collection Account, the Escrow Account (subject to Section 3.05(b))
and the REO Account shall be for the benefit of the Master Servicer as
compensation for the Master Servicer's services pursuant to this Agreement. The
Master Servicer shall deposit in the Collection Account, the Escrow Account, and
the REO Account from its own funds the amount of any loss incurred in respect of
any such Permitted Investment made with funds in such account immediately upon
realization of such loss.
(c) All income in the nature of interest or earnings from the
investment of funds in the Distribution Account shall be for the benefit of the
Trustee as compensation for the Trustee's services pursuant to this Agreement.
The Trustee shall deposit in the Distribution Account from its own funds the
amount of any loss incurred on Permitted Investments in the Distribution
Account.
(d) Funds on deposit in the Pre-Funding Accounts, the Interest
Coverage Account and the Net WAC Rate Carryover Reserve Account may be invested
in Permitted Investments in accordance with this Section 3.06 subject to any
limitations set forth in Section 4.07 (with respect to the Pre-Funding
Accounts), Section 4.08 (with respect to the Interest Coverage Account) and
Section 4.10 (with respect to the Net WAC Rate Carryover Reserve Account) and
any investment earnings or interest paid shall accrue to the benefit of the
party designated in such section and the party so designated shall deposit in
the related account from its own funds the amount of any loss incurred on
Permitted Investments in such account.
(e) Except as otherwise expressly provided in this Agreement, if any
default occurs in the making of a payment due under any Permitted Investment, or
if a default occurs in any other performance required under any Permitted
Investment, the Trustee may and, subject to Section 8.01 and Section 8.02(a)(v),
upon the request of the NIMS Insurer, or the Holders of Certificates
representing more than 50% of the Voting Rights allocated to any Class of
Certificates, shall take such action as may be appropriate to enforce such
payment or performance, including the institution and prosecution of appropriate
proceedings.
(f) The Trustee or its Affiliates are permitted to receive
compensation that could be deemed to be in the Trustee's economic self-interest
for (i) serving as investment adviser, administrator, shareholder, servicing
agent, custodian or sub-custodian with respect to certain of the
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Permitted Investments, (ii) using Affiliates to effect transactions in certain
Permitted Investments and (iii) effecting transactions in certain Permitted
Investments. Such compensation shall not be considered an amount that is
reimbursable or payable pursuant to Section 3.05.
SECTION 3.07. Payment of Taxes, Insurance and Other Charges.
With respect to each Mortgage Loan, the Master Servicer shall
maintain accurate records reflecting the status of ground rents, taxes,
assessments, water rates and other charges which are or may become a lien upon
the Mortgaged Property and the status of fire and hazard insurance coverage and,
as to those Mortgage Loans subject to a voluntary escrow agreement, shall
obtain, from time to time, all bills for the payment of such charges (including
renewal premiums) and shall effect payment thereof prior to the applicable
penalty or termination date and at a time appropriate for securing maximum
discounts allowable, employing for such purpose deposits of the Mortgagor in the
Escrow Account which shall have been estimated and accumulated by the Master
Servicer in amounts sufficient for such purposes, as allowed under the terms of
the Mortgage or Applicable Regulations. The Master Servicer assumes full
responsibility for the timely payment of all such bills and shall effect timely
payments of all such bills irrespective of the Mortgagor's faithful performance
in the payment of same or the making of the Escrow Payments and shall make
Servicing Advances from its own funds to effect such payments. To the extent
that the Mortgage does not provide for Escrow Payments, the Master Servicer
shall use reasonable efforts consistent with the Servicing Standard to determine
that any such payments are made by the Mortgagor at the time they first become
due and shall ensure that the Mortgaged Property is not lost to a tax lien as a
result of nonpayment and that such Mortgaged Property is not left uninsured.
SECTION 3.08. Maintenance of Hazard Insurance.
The Master Servicer shall cause to be maintained for each Mortgage
Loan fire insurance with extended coverage on the related Mortgaged Property in
an amount which is at least equal to the least of (i) the current Stated
Principal Balance of such Mortgage Loan, (ii) the amount necessary to fully
compensate for any damage or loss to the improvements that are a part of such
property on a replacement cost basis and (iii) the maximum insurable value of
the improvements which are a part of such Mortgaged Property, in each case in an
amount not less than such amount as is necessary to avoid the application of any
coinsurance clause contained in the related hazard insurance policy. The Master
Servicer shall also cause to be maintained fire insurance with extended coverage
on each REO Property in an amount which is at least equal to the lesser of (i)
the maximum insurable value of the improvements which are a part of such
property and (ii) the outstanding Stated Principal Balance of the related
Mortgage Loan, plus accrued interest at the Mortgage Rate and related Servicing
Advances (each measured at the time it became an REO Property). The Master
Servicer shall comply in the performance of this Agreement with all reasonable
rules and requirements of each insurer under any such hazard policies. Any
amounts to be collected by the Master Servicer under any such policies (other
than amounts to be applied to the restoration or repair of the property subject
to the related Mortgage or amounts to be released to the Mortgagor in accordance
with the procedures that the Master Servicer would follow in servicing loans
held for its own account, subject to the terms and conditions of the related
Mortgage and Mortgage Note) shall be deposited in the Collection Account,
subject to withdrawal pursuant to Section 3.05, if received in respect of a
Mortgage Loan, or in the REO Account, subject to withdrawal pursuant to Section
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3.13, if received in respect of an REO Property. Any cost incurred by the Master
Servicer in maintaining any such insurance shall not, for the purpose of
calculating distributions to Certificateholders, be added to the unpaid Stated
Principal Balance of the related Mortgage Loan, notwithstanding that the terms
of such Mortgage Loan so permit. It is understood and agreed that no earthquake
or other additional insurance is to be required of any Mortgagor other than
pursuant to such applicable laws and regulations as shall at any time be in
force and as shall require such additional insurance. If the Mortgaged Property
or REO Property is at any time in an area identified in the Federal Register by
the Federal Emergency Management Agency as having special flood hazards, the
Master Servicer shall cause to be maintained a flood insurance policy in respect
thereof. Such flood insurance shall be in an amount equal to the lesser of (i)
the unpaid Stated Principal Balance of the related Mortgage Loan; (ii) the
maximum amount of such insurance available for the related Mortgaged Property
under the national flood insurance program (assuming that the area in which such
Mortgaged Property is located is participating in such program) and (iii) the
maximum insurable value of the improvements which are part of the related
Mortgaged Property.
SECTION 3.09. Maintenance of Mortgage Blanket Insurance.
In the event that the Master Servicer shall obtain and maintain a
blanket policy with an insurer having a General Policy Rating of A:V or better
in Best's Key Rating Guide (or such other rating that is comparable to such
rating) insuring against hazard losses on all of the Mortgage Loans, it shall
conclusively be deemed to have satisfied its obligations as set forth in the
first two sentences of Section 3.08, it being understood and agreed that such
policy may contain a deductible clause, in which case the Master Servicer shall,
in the event that there shall not have been maintained on the related Mortgaged
Property or REO Property a policy complying with the first two sentences of
Section 3.08, and there shall have been one or more losses which would have been
covered by such policy, deposit to the Collection Account from its own funds the
amount not otherwise payable under the blanket policy because of such deductible
clause. In connection with its activities as administrator and servicer of the
Mortgage Loans, the Master Servicer agrees to prepare and present, on behalf of
itself, the Trustee and Certificateholders, claims under any such blanket policy
in a timely fashion in accordance with the terms of such policy.
SECTION 3.10. Fidelity Bond; Errors and Omissions Insurance.
The Master Servicer shall keep in force during the term of this
Agreement a policy or policies of insurance covering errors and omissions for
failure in the performance of the Master Servicer's obligations under this
Agreement, which policy or policies shall be in such form and amount that would
meet the requirements of Xxxxxx Xxx or Xxxxxxx Mac if it were the purchaser of
the Mortgage Loans, unless the Master Servicer has obtained a waiver of such
requirements from Xxxxxx Mae or Xxxxxxx Mac. The Master Servicer shall also
maintain a fidelity bond in the form and amount that would meet the requirements
of Xxxxxx Mae or Xxxxxxx Mac, unless the Master Servicer has obtained a waiver
of such requirements from Xxxxxx Mae or Xxxxxxx Mac. The Master Servicer shall
provide the Trustee and the NIMS Insurer (upon reasonable request) with copies
of any such insurance policies and fidelity bond. The Master Servicer shall be
deemed to have complied with this provision if an Affiliate of the Master
Servicer has such errors and omissions and fidelity bond coverage and, by the
terms of such insurance policy or fidelity bond, the coverage afforded
thereunder extends to the Master Servicer. Any such errors and omissions policy
and fidelity bond
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shall by its terms not be cancelable without thirty days' prior written notice
to the Trustee. The Master Servicer shall also cause each Sub-Servicer to
maintain a policy of insurance covering errors and omissions and a fidelity bond
which would meet such requirements.
SECTION 3.11. Enforcement of Due-On-Sale Clauses; Assumption
Agreements.
The Master Servicer shall, to the extent it has knowledge of any
conveyance or prospective conveyance of any Mortgaged Property by any Mortgagor
(whether by absolute conveyance or by contract of sale, and whether or not the
Mortgagor remains or is to remain liable under the Mortgage Note and/or the
Mortgage), exercise its rights to accelerate the maturity of such Mortgage Loan
under the "due-on-sale" clause, if any, applicable thereto; provided, however,
that the Master Servicer shall not exercise any such rights if prohibited by law
from doing so. If the Master Servicer reasonably believes it is unable under
applicable law to enforce such "due-on-sale" clause, or if any of the other
conditions set forth in the proviso to the preceding sentence apply, the Master
Servicer is authorized to enter into an assumption and modification agreement
from or with the person to whom such property has been conveyed or is proposed
to be conveyed, pursuant to which such person becomes liable under the Mortgage
Note and, to the extent permitted by applicable state law, the Mortgagor remains
liable thereon. The Master Servicer is also authorized to enter into a
substitution of liability agreement with such person, pursuant to which the
original Mortgagor is released from liability and such person is substituted as
the Mortgagor and becomes liable under the Mortgage Note, provided that no such
substitution shall be effective unless such person satisfies the underwriting
criteria of the Master Servicer. In connection with any assumption or
substitution, the Master Servicer shall apply such underwriting standards and
follow such practices and procedures as shall be normal and usual in its general
mortgage servicing activities and as it applies to other mortgage loans owned
solely by it. The Master Servicer shall not take or enter into any assumption
and modification agreement, however, unless (to the extent practicable in the
circumstances) it shall have received confirmation, in writing, of the continued
effectiveness of any applicable hazard insurance policy, or a new policy meeting
the requirements of this Section is obtained. Any fee collected by the Master
Servicer in respect of an assumption or substitution of liability agreement
shall be retained by the Master Servicer as additional servicing compensation.
In connection with any such assumption, no material term of the Mortgage Note
(including but not limited to the related Mortgage Rate and the amount of the
Monthly Payment) may be amended or modified, except as otherwise required
pursuant to the terms thereof or otherwise permitted under Section 3.01. The
Master Servicer shall notify the Trustee and any respective Custodian that any
such substitution or assumption agreement has been completed by forwarding to
the Trustee or to such Custodian, as the case may be, the executed original of
such substitution or assumption agreement, which document shall be added to the
related Mortgage File and shall, for all purposes, be considered a part of such
Mortgage File to the same extent as all other documents and instruments
constituting a part thereof.
Notwithstanding the foregoing paragraph or any other provision of
this Agreement, the Master Servicer shall not be deemed to be in default, breach
or any other violation of its obligations hereunder by reason of any assumption
of a Mortgage Loan by operation of law or by the terms of the Mortgage Note or
any assumption which the Master Servicer may be restricted by law from
preventing, for any reason whatever. For purposes of this Section 3.11, the term
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"assumption" is deemed to also include a sale (of the Mortgaged Property)
subject to the Mortgage that is not accompanied by an assumption or substitution
of liability agreement.
SECTION 3.12. Realization Upon Defaulted Mortgage Loans.
(a) The Master Servicer shall, consistent with the Servicing
Standard and the Loss Mitigation Action Plan, foreclose upon or otherwise
comparably convert the ownership of properties securing such of the Mortgage
Loans as come into and continue in default and as to which no satisfactory
arrangements can be made for collection of delinquent payments pursuant to
Section 3.02. The Master Servicer shall be responsible for all costs and
expenses incurred by it in any such proceedings; provided, however, that such
costs and expenses shall be recoverable as Servicing Advances by the Master
Servicer as contemplated in Section 3.05 and Section 3.13. The foregoing is
subject to the provision that, in any case in which Mortgaged Property shall
have suffered damage from an Uninsured Cause, the Master Servicer shall not be
required to expend its own funds toward the restoration of such property unless
it shall determine in its discretion that such restoration shall increase the
proceeds of liquidation of the related Mortgage Loan after reimbursement to
itself for such expenses.
(b) Notwithstanding the foregoing provisions of this Section 3.12 or
any other provision of this Agreement, with respect to any Mortgage Loan as to
which the Master Servicer has received actual notice of, or has actual knowledge
of, the presence of any toxic or hazardous substance on the related Mortgaged
Property, the Master Servicer shall not, on behalf of the Trustee, either (i)
obtain title to such Mortgaged Property as a result of or in lieu of foreclosure
or otherwise or (ii) otherwise acquire possession of, or take any other action
with respect to, such Mortgaged Property, if, as a result of any such action,
the Trustee, the Trust Fund or the Certificateholders would be considered to
hold title to, to be a "mortgagee-in-possession" of, or to be an "owner" or
"operator" of such Mortgaged Property within the meaning of the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended from
time to time, or any comparable law, unless the Master Servicer has also
previously determined, based on its reasonable judgment and a report prepared by
a Person who regularly conducts environmental audits using customary industry
standards, that:
(1) such Mortgaged Property is in compliance with applicable
environmental laws or, if not, that it would be in the best economic
interest of the Trust Fund to take such actions as are necessary to bring
the Mortgaged Property into compliance therewith; and
(2) there are no circumstances present at such Mortgaged Property relating
to the use, management or disposal of any hazardous substances, hazardous
materials, hazardous wastes, or petroleum-based materials for which
investigation, testing, monitoring, containment, clean-up or remediation could
be required under any federal, state or local law or regulation, or that if any
such materials are present for which such action could be required, that it
would be in the best economic interest of the Trust Fund to take such actions
with respect to the affected Mortgaged Property.
Notwithstanding the foregoing, if such environmental audit reveals,
or if the Master Servicer has actual knowledge or notice, that such Mortgaged
Property contains such toxic or
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hazardous wastes or substances, the Master Servicer shall not foreclose or
accept a deed in lieu of foreclosure without the prior written consent of the
NIMS Insurer.
The cost of the environmental audit report contemplated by this
Section 3.12 shall be advanced by the Master Servicer, subject to the Master
Servicer's right to be reimbursed therefor from the Collection Account as
provided in Section 3.05(a)(v), such right of reimbursement being prior to the
rights of Certificateholders to receive any amount in the Collection Account
received in respect of the affected Mortgage Loan or other Mortgage Loans.
If the Master Servicer determines, as described above, that it is in
the best economic interest of the Trust Fund to take such actions as are
necessary to bring any such Mortgaged Property into compliance with applicable
environmental laws, or to take such action with respect to the containment,
clean-up or remediation of hazardous substances, hazardous materials, hazardous
wastes or petroleum-based materials affecting any such Mortgaged Property, then
the Master Servicer shall take such action as it deems to be in the best
economic interest of the Trust Fund. Provided, however, that the Master Servicer
shall not proceed with foreclosure or acceptance of a deed in lieu of
foreclosure if the estimated costs of the environmental clean up, as estimated
in the environmental audit report, together with the Advances made by the Master
Servicer and the estimated costs of foreclosure or acceptance of a deed in lieu
of foreclosure exceeds the estimated value of the Mortgaged Property. The cost
of any such compliance, containment, cleanup or remediation shall be advanced by
the Master Servicer, subject to the Master Servicer's right to be reimbursed
therefor from the Collection Account as provided in Section 3.05(a)(v), such
right of reimbursement being prior to the rights of Certificateholders to
receive any amount in the Collection Account received in respect of the affected
Mortgage Loan or other Mortgage Loans.
(c) Proceeds received in connection with any Final Recovery
Determination, as well as any recovery resulting from a partial collection of
Insurance Proceeds, Subsequent Recoveries or Liquidation Proceeds, in respect of
any Mortgage Loan, shall be applied in the following order of priority: first,
to reimburse the Master Servicer or any Sub-Servicer for any related
unreimbursed Servicing Advances and Advances, pursuant to Section 3.05(a)(ii);
second, to accrued and unpaid interest on the Mortgage Loan, to the date of the
Final Recovery Determination, or to the Due Date prior to the Distribution Date
on which such amounts are to be distributed if not in connection with a Final
Recovery Determination; and third, as a recovery of principal of the Mortgage
Loan. If the amount of the recovery so allocated to interest is less than the
full amount of accrued and unpaid interest due on such Mortgage Loan, the amount
of such recovery shall be allocated by the Master Servicer as follows: first, to
unpaid Servicing Fees; and second, to the balance of the interest then due and
owing. The portion of the recovery so allocated to unpaid Servicing Fees shall
be reimbursed to the Master Servicer or any Sub-Servicer pursuant to Section
3.05(a)(ii).
SECTION 3.13. Title, Management and Disposition of REO Property.
(a) The deed or certificate of sale of any REO Property shall be
taken in the name of the Trustee, or its nominee, in trust for the benefit of
the Certificateholders. Pursuant to the power of attorney granted in Section
3.01, the Master Servicer is hereby authorized to transfer the title of any REO
Property taken in the name of the Trustee to a third party purchaser pursuant to
this Section
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3.13 without further documentation of its authority as attorney-in-fact for the
Trustee on behalf of the Trust. The Master Servicer, on behalf of the Trust Fund
(and on behalf of the Trustee for the benefit of the Certificateholders), shall
either sell any REO Property before the close of the third taxable year after
the year the Trust Fund acquires ownership of such REO Property for purposes of
Section 860G(a)(8) of the Code or request from the Internal Revenue Service, no
later than 60 days before the day on which the three-year grace period would
otherwise expire, an extension of the three-year grace period, unless the Master
Servicer shall have delivered to the Trustee, the NIMS Insurer and the Depositor
an Opinion of Counsel, addressed to the Trustee, the NIMS Insurer and the
Depositor, to the effect that the holding by the Trust Fund of such REO Property
subsequent to three years after its acquisition shall not result in the
imposition on any Trust REMIC of taxes on "prohibited transactions" thereof, as
defined in Section 860F of the Code, or cause any Trust REMIC to fail to qualify
as a REMIC under Federal law at any time that any Certificates are outstanding.
The Master Servicer shall manage, conserve, protect and operate each REO
Property for the benefit of the Certificateholders and solely for the purpose of
its prompt disposition and sale in a manner which does not cause such REO
Property to fail to qualify as "foreclosure property" within the meaning of
Section 860G(a)(8) of the Code or result in the receipt by any Trust REMIC of
any "income from non-permitted assets" within the meaning of Section
860F(a)(2)(B) of the Code, or any "net income from foreclosure property" which
is subject to taxation under the REMIC Provisions.
(b) The Master Servicer shall segregate and hold all funds collected
and received in connection with the operation of any REO Property separate and
apart from its own funds and general assets and shall establish and maintain
with respect to REO Properties an account held in trust for the Trustee for the
benefit of the Certificateholders (the "REO Account"), which shall be an
Eligible Account. The Master Servicer shall be permitted to allow the Collection
Account to serve as the REO Account, subject to separate ledgers for each REO
Property. The Master Servicer shall be entitled to retain or withdraw any
interest income paid on funds deposited in the REO Account.
(c) The Master Servicer shall have full power and authority, subject
only to the specific requirements and prohibitions of this Agreement (including
the Loss Mitigation Action Plan), to do any and all things in connection with
any REO Property as are consistent with the manner in which the Master Servicer
manages and operates similar property owned by the Master Servicer or any of its
Affiliates, all on such terms and for such period as the Master Servicer deems
to be in the best interests of Certificateholders and appropriate to effect the
prompt disposition and sale of the REO Property. In connection therewith, the
Master Servicer shall deposit, or cause to be deposited in the clearing account
(which account must be an Eligible Account) in which it customarily deposits
payments and collections on mortgage loans in connection with its mortgage loan
servicing activities on a daily basis, and in no event more than one Business
Day after the Master Servicer's receipt thereof, and shall thereafter deposit in
the REO Account, in no event more than two Business Days after the deposit of
such funds into the clearing account, all revenues received by it with respect
to an REO Property and shall withdraw therefrom funds necessary for the proper
operation, management and maintenance of such REO Property including, without
limitation:
(i) all insurance premiums due and payable in respect of such REO
Property;
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(ii) all real estate taxes and assessments in respect of such REO
Property that may result in the imposition of a lien thereon; and
(iii) all costs and expenses necessary to maintain such REO
Property.
To the extent that amounts on deposit in the REO Account with
respect to an REO Property are insufficient for the purposes set forth in
clauses (i) through (iii) above with respect to such REO Property, the Master
Servicer shall advance from its own funds such amount as is necessary for such
purposes if, but only if, the Master Servicer would make such advances if the
Master Servicer owned the REO Property and if in the Master Servicer's judgment,
the payment of such amounts shall be recoverable from the rental or sale of the
REO Property.
Notwithstanding the Master Servicer's obligation to the
Certificateholders to manage and operate (including the collection of rents from
existing tenants and management of any leases acquired with the REO property to
the extent applicable) the REO Property from the date of acquisition until the
date of sale, neither the Master Servicer nor the Trustee shall knowingly:
(i) authorize the Trust Fund to enter into, renew or extend any New
Lease with respect to any REO Property, if the New Lease by its terms
shall give rise to any income that does not constitute Rents from Real
Property;
(ii) authorize any amount to be received or accrued under any New
Lease other than amounts that shall constitute Rents from Real Property;
(iii) authorize any construction on any REO Property, other than the
completion of a building or other improvement thereon, and then only if
more than ten percent of the construction of such building or other
improvement was completed before default on the related Mortgage Loan
became imminent, all within the meaning of Section 856(e)(4)(B) of the
Code; or
(iv) authorize any Person to Directly Operate any REO Property on
any date more than 90 days after its date of acquisition by the Trust
Fund;
unless, in any such case, the Master Servicer has obtained an Opinion of
Counsel, provided to the Trustee and the NIMS Insurer, to the effect that such
action shall not cause such REO Property to fail to qualify as "foreclosure
property" within the meaning of Section 860G(a)(8) of the Code at any time that
it is held by the Trust Fund, and (B) the Master Servicer has received written
notice from the Trustee that it has received written consent from the NIMS
Insurer that the specific action may be taken.
The Master Servicer may contract with any Independent Contractor for
the operation and management of any REO Property, provided that:
(i) the terms and conditions of any such contract shall not be
inconsistent herewith;
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(ii) any such contract shall require, or shall be administered to
require, that the Independent Contractor pay all costs and expenses
incurred in connection with the operation and management of such REO
Property, including those listed above and remit all related revenues (net
of such costs and expenses) to the Master Servicer as soon as practicable,
but in no event later than thirty days following the receipt thereof by
such Independent Contractor;
(iii) none of the provisions of this Section 3.13(c) relating to any
such contract or to actions taken through any such Independent Contractor
shall be deemed to relieve the Master Servicer of any of its duties and
obligations to the Trustee on behalf of the Certificateholders with
respect to the operation and management of any such REO Property; and
(iv) the Master Servicer shall be obligated with respect thereto to
the same extent as if it alone were performing all duties and obligations
in connection with the operation and management of such REO Property.
The Master Servicer shall be entitled to enter into any agreement
with any Independent Contractor performing services for it related to its duties
and obligations hereunder for indemnification of the Master Servicer by such
Independent Contractor, and nothing in this Agreement shall be deemed to limit
or modify such indemnification. The Master Servicer shall be solely liable for
all fees owed by it to any such Independent Contractor, irrespective of whether
the Master Servicer's compensation pursuant to Section 3.18 is sufficient to pay
such fees. The Master Servicer shall not engage an Independent Contractor to
engage in any activities that the Master Servicer would not be permitted to
engage in itself in accordance with the other provisions of this Agreement
(including the Loss Mitigation Action Plan).
(d) In addition to the withdrawals permitted under Section 3.13(c),
the Master Servicer may from time to time make withdrawals from the REO Account
for any REO Property: (i) to pay itself or any Sub-Servicer unpaid Servicing
Fees in respect of the related Mortgage Loan; and (ii) to reimburse itself or
any Sub-Servicer for unreimbursed Servicing Advances and Advances made in
respect of such REO Property or the related Mortgage Loan. On the Master
Servicer Remittance Date, the Master Servicer shall withdraw from each REO
Account maintained by it and deposit into the Distribution Account in accordance
with Section 3.04(g)(ii), for distribution on the related Distribution Date in
accordance with Section 4.01, the income from the related REO Property received
during the prior calendar month, net of any withdrawals made pursuant to Section
3.13(c) or this Section 3.13(d).
(e) Subject to the time constraints set forth in Section 3.13(a),
(including the constraint that the Master Servicer hold and manage each REO
Property "solely for the purpose of its prompt disposition") each REO
disposition shall be carried out by the Master Servicer at such price and upon
such terms and conditions as shall be in conformity with the requirements of the
Loss Mitigation Action Plan and as shall be normal and usual in its general
servicing activities for similar properties.
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(f) The proceeds from the REO Disposition, net of any amount
required by law to be remitted to the Mortgagor under the related Mortgage Loan
and net of any payment or reimbursement to the Master Servicer or any
Sub-Servicer as provided above, shall be deposited in the Distribution Account
in accordance with Section 3.04(g)(ii) on the Master Servicer Remittance Date in
the month following the receipt thereof for distribution on the related
Distribution Date in accordance with Section 4.01. Any REO Disposition shall be
for cash only (unless changes in the REMIC Provisions made subsequent to the
Startup Day allow a sale for other consideration).
SECTION 3.14. [Reserved].
SECTION 3.15. Reports of Foreclosure and Abandonment of Mortgaged
Properties.
The Master Servicer shall file information returns with respect to
the receipt of mortgage interest received in a trade or business, reports of
foreclosures and abandonments of any Mortgaged Property and cancellation of
indebtedness income with respect to any Mortgaged Property as required by
Sections 6050H, 6050J and 6050P of the Code, respectively. Such reports shall be
in form and substance sufficient to meet the reporting requirements imposed by
such Sections 6050H, 6050J and 6050P of the Code.
SECTION 3.16. Optional Purchase of Defaulted Mortgage Loans.
(a)(i) The NIMS Insurer may, at its option, purchase a Mortgage Loan
which has become 90 or more days delinquent or for which the Master Servicer has
accepted a deed in lieu of foreclosure. Prior to purchase pursuant to this
Section 3.16(a)(i), the Master Servicer shall be required to continue to make
Advances pursuant to Section 4.03. The NIMS Insurer shall not use any procedure
in selecting Mortgage Loans to be repurchased which is materially adverse to the
interests of the Certificateholders. The NIMS Insurer shall purchase such
delinquent Mortgage Loan at a price equal to the Purchase Price of such Mortgage
Loan. Any such purchase of a Mortgage Loan pursuant to this Section 3.16(a)(i)
shall be accomplished by remittance to the Master Servicer for deposit in the
Collection Account of the amount of the Purchase Price. The Trustee shall
effectuate the conveyance of such delinquent Mortgage Loan to the NIMS Insurer
to the extent necessary, as requested, and the Trustee shall promptly deliver
all documentation to the NIMS Insurer.
(ii) During the first full calender month (but excluding the last
Business Day thereof) following a Mortgage Loan or related REO Property becoming
90 days or more delinquent, the Master Servicer shall have the option, but not
the obligation to purchase from the Trust Fund any such Mortgage Loan or related
REO Property that is then still 90 days or more delinquent, which the Master
Servicer determines in good faith shall otherwise become subject to foreclosure
proceedings (evidence of such determination to be delivered in writing to the
Trustee prior to purchase), at a price equal to the Purchase Price. The Purchase
Price for any Mortgage Loan or related REO Property purchased hereunder shall be
deposited in the Collection Account, and the Trustee, upon written certification
of such deposit, shall release or cause to be released to the Master Servicer
the related Mortgage File and the Trustee shall execute and deliver such
instruments of transfer or assignment,
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in each case without recourse, as the Master Servicer shall furnish and as shall
be necessary to vest in the Master Servicer title to any Mortgage Loan or
related REO Property released pursuant hereto.
(iii) Following the expiration of the Master's Servicer's option to
purchase from the Trust Fund any such Mortgage Loan or related REO Property that
is then still 90 days or more delinquent, the Special Sub-Servicer shall have
the option, but not the obligation to purchase from the Trust Fund any such
Mortgage Loan or related REO Property at a price equal to the Purchase Price for
a period of 30 days. The Purchase Price for any Mortgage Loan or related REO
Property purchased hereunder shall be deposited in the Collection Account, and
the Trustee, upon written certification of such deposit, shall release or cause
to be released to the Special Sub-Servicer the related Mortgage File and the
Trustee shall execute and deliver such instruments of transfer or assignment, in
each case without recourse, as the Special Sub-Servicer shall furnish and as
shall be necessary to vest in the Special Sub-Servicer title to any Mortgage
Loan or related REO Property released pursuant hereto.
(b) If with respect to any delinquent Mortgage Loan or related REO
Property, the option of the Special Sub-Servicer set forth in the preceding
paragraph shall have arisen but the Special Sub-Servicer shall have failed to
exercise such option, then such option shall automatically expire; provided,
however, that if any such Mortgage Loan or related REO Property shall cease to
be 90 days or more delinquent but then subsequently shall again become 90 days
or more delinquent, then the Master Servicer and the Special Sub-Servicer shall
be entitled to another repurchase option with respect to such Mortgage Loan or
REO Property as provided in the preceding paragraphs.
SECTION 3.17. Trustee to Cooperate; Release of Mortgage Files.
(a) Upon the payment in full of any Mortgage Loan, or the receipt by
the Master Servicer of a notification that payment in full shall be escrowed in
a manner customary for such purposes, the Master Servicer shall promptly notify
the Trustee and any related Custodian by a certification in the form of Exhibit
E or such other form supplied by the Master Servicer provided that it does not
differ from the substantive content of Exhibit E, (which certification shall
include a statement to the effect that all amounts received or to be received in
connection with such payment which are required to be deposited in the
Collection Account pursuant to Section 3.04(b) have been or shall be so
deposited) of a Servicing Officer and shall request delivery to it of the
Mortgage File. Upon receipt of such certification and request, the Trustee or
such Custodian, as the case may be, shall promptly release (and in no event more
than three (3) Business Days thereafter) the related Mortgage File to the Master
Servicer. No expenses incurred in connection with any instrument of satisfaction
or deed of reconveyance shall be chargeable to the Collection Account or the
Distribution Account.
(b) From time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan, including, for this purpose, collection under
any insurance policy relating to the Mortgage Loans, the Trustee and any related
Custodian shall, upon request of the Master Servicer and delivery to the Trustee
or such Custodian, as the case may be, of a Request for Release in the form of
Exhibit E or such other form supplied by the Master Servicer provided that it
does not differ from the substantive content of Exhibit E, release the related
Mortgage File to the Master Servicer, and the Trustee shall, at the direction of
the Master Servicer, execute such documents as shall be
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necessary to the prosecution of any such proceedings and the Master Servicer
shall retain such Mortgage File in trust for the benefit of the
Certificateholders. Such Request for Release shall obligate the Master Servicer
to return each and every document previously requested from the Mortgage File to
the Trustee or to such Custodian when the need therefor by the Master Servicer
no longer exists, unless the Mortgage Loan has been liquidated and the
Liquidation Proceeds relating to the Mortgage Loan have been deposited in the
Collection Account or the Mortgage File or such document has been delivered to
an attorney, or to a public trustee or other public official as required by law,
for purposes of initiating or pursuing legal action or other proceedings for the
foreclosure of the Mortgaged Property either judicially or non-judicially, and
the Master Servicer has delivered to the Trustee a certificate of a Servicing
Officer certifying as to the name and address of the Person to which such
Mortgage File or such document was delivered and the purpose or purposes of such
delivery. Upon receipt of a certificate of a Servicing Officer stating that such
Mortgage Loan was liquidated and that all amounts received or to be received in
connection with such liquidation that are required to be deposited into the
Collection Account have been so deposited, or that such Mortgage Loan has become
an REO Property, upon request, a copy of the Request for Release shall be
released by the Trustee or such Custodian to the Master Servicer.
(c) Upon written certification of a Servicing Officer, the Trustee
shall execute and deliver to the Master Servicer any court pleadings, requests
for trustee's sale or other documents reasonably necessary to the foreclosure or
trustee's sale in respect of a Mortgaged Property or to any legal action brought
to obtain judgment against any Mortgagor on the Mortgage Note or Mortgage or to
obtain a deficiency judgment, or to enforce any other remedies or rights
provided by the Mortgage Note or Mortgage or otherwise available at law or in
equity. Each such certification shall include a request that such pleadings or
documents be executed by the Trustee and a statement as to the reason such
documents or pleadings are required and that the execution and delivery thereof
by the Trustee shall not invalidate or otherwise affect the lien of the
Mortgage, except for the termination of such a lien upon completion of the
foreclosure or trustee's sale.
(d) The Trustee and the Master Servicer may mutually agree on
policies and procedures (commercially reasonable in nature) to allow the
submission of any and all requests for the release of a Mortgage File
electronically with a digital signature or other identifier to designate the
Servicing Officer of the Master Servicer requesting such collateral.
SECTION 3.18. Servicing Compensation.
As compensation for the activities of the Master Servicer hereunder,
the Master Servicer shall be entitled to the Servicing Fee with respect to each
Mortgage Loan (other than any Mortgage Loan that becomes 90 days or more
delinquent) payable solely from payments of interest in respect of such Mortgage
Loan, subject to Section 4.03(e). In addition, the Master Servicer shall be
entitled to recover unpaid Servicing Fees out of Insurance Proceeds, Subsequent
Recoveries or Liquidation Proceeds to the extent permitted by Section
3.05(a)(ii), out of general funds in the Collection Account to the extent
permitted by Section 3.05(a) and out of amounts derived from the operation and
sale of an REO Property to the extent permitted by Section 3.13. The right to
receive the Servicing Fee may not be transferred in whole or in part except in
connection with the transfer of all of the Master Servicer's responsibilities
and obligations under this Agreement.
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As compensation for its services, the Special Sub-Servicer will be
paid the Servicing Fee with respect to each Mortgage Loan that becomes 90 days
or more delinquent.
Additional servicing compensation in the form of assumption fees,
late payment charges, insufficient funds fees, reconveyance fees and other
similar fees and charges (other than Prepayment Charges) shall be retained by
the Master Servicer only to the extent such fees or charges are received by the
Master Servicer. The Master Servicer shall also be entitled pursuant to Section
3.05(a)(vi) to withdraw from the Collection Account, pursuant to Section 3.04(h)
to withdraw from any Escrow Account and pursuant to Section 3.13(b) to withdraw
from any REO Account, as additional servicing compensation, interest or other
income earned on deposits therein, subject to Section 3.06. The Master Servicer
shall be required to pay all expenses incurred by it in connection with its
servicing activities hereunder (including premiums for the insurance required by
Section 3.08, Section 3.09 and Section 3.10, to the extent such premiums are not
paid by the related Mortgagors or by a Sub-Servicer, servicing compensation of
each Sub-Servicer, and to the extent provided in Section 8.05, the fees and
expenses of the Trustee) and shall not be entitled to reimbursement therefor
except as specifically provided herein.
SECTION 3.19. Statement as to Compliance.
The Master Servicer shall deliver to the Trustee, the NIMS Insurer,
the Depositor and each Rating Agency on or before March 15th of each calendar
year commencing in 2005, an Officers' Certificate, in a form similar to Exhibit
M attached hereto agreeable to the parties hereto, stating, as to each signatory
thereof, that (i) a review of the activities of the Master Servicer during the
preceding calendar year and of performance under this Agreement has been made
under such officers' supervision and (ii) to the best of such officers'
knowledge, based on such review, the Master Servicer has fulfilled all of its
obligations under this Agreement throughout such year, or, if there has been a
default in the fulfillment of any such obligation, specifying each such default
known to such officer and the nature and status thereof. Copies of any such
statement shall be provided by the Trustee to any Certificateholder and to any
Person identified to the Trustee as a prospective transferee of a Certificate,
upon the request and at the expense of the requesting party, provided that such
statement is delivered by the Master Servicer to the Trustee.
SECTION 3.20. Independent Public Accountants' Servicing Report.
Not later than March 15th of each calendar year commencing in 2005,
the Master Servicer, at its expense, shall cause a nationally recognized firm of
independent certified public accountants to furnish to the Master Servicer a
report stating that (i) it has obtained a letter of representation regarding
certain matters from the management of the Master Servicer which includes an
assertion that the Master Servicer has complied with certain minimum residential
mortgage loan servicing standards, identified in the Uniform Single Attestation
Program for Mortgage Bankers established by the Mortgage Bankers Association of
America, with respect to the servicing of residential mortgage loans during the
most recently completed calendar year and (ii) on the basis of an examination
conducted by such firm in accordance with standards established by the American
Institute of Certified Public Accountants, such representation is fairly stated
in all material respects, subject to such exceptions and other qualifications
that may be appropriate. In rendering its report such firm may rely, as to
matters relating to the direct servicing of residential mortgage loans by Sub-
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Servicers, upon comparable reports of firms of independent certified public
accountants rendered on the basis of examinations conducted in accordance with
the same standards (rendered within one year of such report) with respect to
those Sub-Servicers. Immediately upon receipt of such report, the Master
Servicer shall furnish a copy of such report to the Trustee, the NIMS Insurer
and each Rating Agency. Copies of such statement shall be provided by the
Trustee to any Certificateholder upon request at the Master Servicer's expense,
provided that such statement is delivered by the Master Servicer to the Trustee.
In the event such firm of independent certified public accountants requires the
Trustee to agree to the procedures performed by such firm, the Master Servicer
shall direct the Trustee in writing to so agree; it being understood and agreed
that the Trustee shall deliver such letter of agreement in conclusive reliance
upon the direction of the Master Servicer, and the Trustee has not made any
independent inquiry or investigation as to, and shall have no obligation or
liability in respect of, the sufficiency, validity or correctness of such
procedures.
SECTION 3.21. Access to Certain Documentation.
The Master Servicer shall provide to the Office of Thrift
Supervision, the FDIC, and any other federal or state banking or insurance
regulatory authority that may exercise authority over any Certificateholder or
Certificate Owner, access to the documentation regarding the Mortgage Loans
required by applicable laws and regulations. Such access shall be afforded
without charge, but only upon reasonable request and during normal business
hours at the offices of the Master Servicer designated by it. In addition,
access to the documentation regarding the Mortgage Loans shall be provided to
any Certificateholder or Certificate Owner, the Trustee, the NIMS Insurer and to
any Person identified to the Master Servicer as a prospective transferee of a
Certificate, upon reasonable request during normal business hours at the offices
of the Master Servicer designated by it at the expense of the Person requesting
such access. In each case, access to any documentation regarding the Mortgage
Loans may be conditioned upon the requesting party's acknowledgment in writing
of a confidentiality agreement regarding any information that is required to
remain confidential under the Xxxxx-Xxxxx-Xxxxxx Act of 1999.
SECTION 3.22. [Reserved].
SECTION 3.23. Advance Facility.
(a) The Master Servicer and/or the Trustee on behalf of the Trust
Fund, in either case, with the consent of the NIMS Insurer and the Master
Servicer in the case of the Trustee, is hereby authorized to enter into a
facility (an "Advance Facility") with any Person which provides that such Person
(an "Advancing Person") may fund Advances and/or Servicing Advances to the Trust
Fund under this Agreement, although no such facility shall reduce or otherwise
affect the Master Servicer's obligation to fund such Advances and/or Servicing
Advances. If the Master Servicer enters into such an Advance Facility pursuant
to this Section 3.23, upon reasonable request of the Advancing Person, the
Trustee shall execute a letter of acknowledgment, confirming its receipt of
notice of the existence of such Advance Facility. To the extent that an
Advancing Person funds any Advance or any Servicing Advance and provides the
Trustee with notice acknowledged by the Master Servicer that such Advancing
Person is entitled to reimbursement directly from the Trustee pursuant to the
terms of the Advance Facility, such Advancing Person shall be entitled to
receive reimbursement pursuant to this Agreement for such amount to the extent
provided in Section 3.23(b).
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Such notice from the Advancing Person must specify the amount of the
reimbursement, the Section of this Agreement that permits the applicable Advance
or Servicing Advance to be reimbursed and the section(s) of the Advance Facility
that entitle the Advancing Person to request reimbursement from the Trustee,
rather than the Master Servicer, and include the Master Servicer's
acknowledgment thereto or proof of an Event of Default under the Advance
Facility. The Trustee shall have no duty or liability with respect to any
calculation of any reimbursement to be paid to an Advancing Person and shall be
entitled to rely without independent investigation on the Advancing Person's
notice provided pursuant to this Section 3.23. An Advancing Person whose
obligations hereunder are limited to the funding of Advances and/or Servicing
Advances shall not be required to meet the qualifications of a Master Servicer
or a Sub-Servicer pursuant to Section 6.06 hereof and shall not be deemed to be
a Sub-Servicer under this Agreement. If the terms of a facility proposed to be
entered into with an Advancing Person by the Trust Fund would not materially and
adversely affect the interests of any Certificateholder, then the NIMS Insurer
shall not withhold its consent to the Trust Fund's entering such facility.
(b) If, pursuant to the terms of the Advance Facility, an Advancing
Person is entitled to reimbursement directly from the Trustee, then the Master
Servicer shall not reimburse itself therefor under Section 3.05(a)(ii), Section
3.05(a)(iii), Section 3.05(a)(v) or Section 3.05(a)(vii) prior to the remittance
to the Trust Fund, but instead the Master Servicer shall include such amounts in
the applicable remittance to the Trustee made pursuant to Section 3.04(g) to the
extent of amounts on deposit in the Collection Account on the related Master
Servicer Remittance Date. The Trustee is hereby authorized to pay to the
Advancing Person reimbursements for Advances and Servicing Advances from the
Distribution Account, to the extent permitted under the terms of the Advance
Facility, to the same extent the Master Servicer would have been permitted to
reimburse itself for such Advances and/or Servicing Advances in accordance with
Section 3.05(a)(ii), Section 3.05(a)(iii) or Section 3.05(a)(v), as the case may
be, had the Master Servicer itself funded such Advance or Servicing Advance. The
Trustee is hereby authorized to pay directly to the Advancing Person such
portion of the Servicing Fee as the parties to any advancing facility agree to
in writing delivered to the Trustee.
(c) All Advances and Servicing Advances made pursuant to the terms
of this Agreement shall be deemed made and shall be reimbursed on a "first in
first out" (FIFO) basis.
(d) In the event the Master Servicer is terminated pursuant to
Section 7.01, the Advancing Person shall succeed to the terminated Master
Servicer's right of reimbursement set forth in Section 7.02(c) to the extent of
such Advancing Person's financing of Advances or Servicing Advances hereunder
then remaining unreimbursed.
(e) Any amendment to this Section 3.23 or to any other provision of
this Agreement that may be necessary or appropriate to effect the terms of an
Advance Facility as described generally in this Section 3.23, including
amendments to add provisions relating to a successor master servicer, may be
entered into by the Trustee and the Master Servicer without the consent of any
Certificateholder but with the consent of the NIMS Insurer and written
confirmation from each Rating Agency that the amendment shall not result in the
reduction or withdrawal of the then-current ratings of any outstanding Class of
Certificates or any other notes secured by collateral
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which includes all or a portion of the Class CE Certificates, the Class P
Certificates and/or the Residual Certificates, notwithstanding anything to the
contrary in this Agreement.
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ARTICLE IV
PAYMENTS TO CERTIFICATEHOLDERS
SECTION 4.01. Distributions.
(a)(1)(A) On each Distribution Date, the following
amounts, in the following order of priority, shall be distributed by REMIC I to
REMIC II on account of the REMIC I Regular Interests or withdrawn from the
Distribution Account and distributed to the Holders of the Class R Certificates
(in respect of the Class R-I Interest), as the case may be:
With respect to the Group I Mortgage Loans:
(1) (a) to the Holders of REMIC Regular Interest I-LT1, REMIC I
Regular Interest I-LT1PF and REMIC I Regular Interest I-LTP in
an amount equal to (A) the Uncertificated Interest for each
REMIC I Regular Interest for such Distribution Date, plus (B)
any amounts in respect thereof remaining unpaid from previous
Distribution Dates; and
(b) to the Holders of REMIC I Regular Interest I-LTP, on the
Distribution Date immediately following the expiration of the
latest Prepayment Charge as identified on the Prepayment
Charge Schedule or any Distribution Date thereafter until $100
has been distributed pursuant to this clause;
(ii) to the Holders of REMIC I Regular Interest I-LT1 and REMIC I
Regular Interest I-LT1PF, in an amount equal to the remainder of the
Available Funds for such Distribution Date after the distributions made
pursuant to clause (i) above, allocated as follows:
(a) to the Holders of REMIC I Regular Interest I-LT1, until
the Uncertificated Balance of REMIC I Regular Interest I-LT1
is reduced to zero;
(b) to the Holders of REMIC I Regular Interest I-LT1PF, until
the Uncertificated Balance of REMIC I Regular Interest I-LT1PF
is reduced to zero; and
(c) any remaining amount to the Holders of the Class R
Certificates (in respect of the Class R-I Interest).
provided, however, that for the first three Distribution Dates, such amounts
relating to the Initial Group I Mortgage Loans shall be allocated to REMIC I
Regular Interest I-LT1 and such amounts relating to the Subsequent Group I
Mortgage Loans shall be allocated to REMIC I Regular Interest I-LT1PF.
With respect to the Group II Mortgage Loans:
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(i) to the Holders of REMIC Regular Interest I-LT2 and REMIC I
Regular Interest I-LT2PF in an amount equal to (A) the Uncertificated
Interest for each REMIC I Regular Interest for such Distribution Date,
plus (B) any amounts in respect thereof remaining unpaid from previous
Distribution Dates;
(ii) to the Holders of REMIC I Regular Interest I-LT2 and REMIC I
Regular Interest I-LT2PF, in an amount equal to the remainder of the
Available Funds for such Distribution Date after the distributions made
pursuant to clause (i) above, allocated as follows:
(a) to the Holders of REMIC I Regular Interest I-LT2, until
the Uncertificated Balance of REMIC I Regular Interest I-LT2
is reduced to zero;
(b) to the Holders of REMIC I Regular Interest I-LT2PF, until
the Uncertificated Balance of REMIC I Regular Interest I-LT2PF
is reduced to zero; and
(c) any remaining amount to the Holders of the Class R
Certificates (in respect of the Class R-I Interest).
provided, however, that for the first three Distribution Dates, such amounts
relating to the Initial Group II Mortgage Loans shall be allocated to REMIC I
Regular Interest I-LT2 and such amounts relating to the Subsequent Group II
Mortgage Loans shall be allocated to REMIC I Regular Interest I-LT2PF.
On each Distribution Date, all amounts representing Prepayment
Charges in respect of the Mortgage Loans received during the related Prepayment
Period will be distributed by REMIC I to the Holders of REMIC I Regular Interest
I-LTP. The payment of the foregoing amounts to the Holders of REMIC I Regular
Interest I-LTP shall not reduce the Uncertificated Balance thereof.
(B) On each Distribution Date, the following amounts, in the
following order of priority, shall be distributed by REMIC II to REMIC III on
account of the REMIC II Regular Interests or withdrawn from the Distribution
Account and distributed to the Holders of the Class R Certificates (in respect
of the Class R-II Interest), as the case may be:
(i) first, to Holders of REMIC II Regular Interest II-LTAA, REMIC
Regular Interest II-LTA1, REMIC II Regular Interest II-LTA2, REMIC II
Regular Interest II-LTA3, REMIC II Regular Interest II-LTA4, REMIC II
Regular Interest II-LTA5, REMIC II Regular Interest II-LTM1, REMIC II
Regular Interest II-LTM2, REMIC II Regular Interest II-LTM3, REMIC II
Regular Interest II-LTM4, REMIC II Regular Interest II-LTM5, REMIC II
Regular Interest II-LTM6, REMIC II Regular Interest II-LTM7, REMIC II
Regular Interest II-LTM8, REMIC II Regular Interest II-LTM9, REMIC II
Regular Interest II-LTM10, REMIC II Regular Interest II-LTZZ and REMIC II
Regular Interest II-LTP, pro rata, in an amount equal to (A) the
Uncertificated Interest for such Distribution Date, plus (B) any amounts
in respect thereof remaining unpaid from previous Distribution Dates.
Amounts payable as Uncertificated Interest in respect of REMIC II Regular
Interest II-LTZZ shall be
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reduced and deferred when the REMIC II Overcollateralized Amount is less
than the REMIC II Overcollateralization Target Amount, by the lesser of
(x) the amount of such difference and (y) the Maximum II-LTZZ
Uncertificated Interest Deferral Amount and such amount will be payable to
the Holders of REMIC Regular Interest II-LTA1, REMIC II Regular Interest
II-LTA2, REMIC II Regular Interest II-LTA3, REMIC II Regular Interest
II-LTA4, REMIC II Regular Interest II-LTA5, REMIC II Regular Interest
II-LTM1, REMIC II Regular Interest II-LTM2, REMIC II Regular Interest
II-LTM3, REMIC II Regular Interest II-LTM4, REMIC II Regular Interest
II-LTM5, REMIC II Regular Interest II-LTM6, REMIC II Regular Interest
II-LTM7, REMIC II Regular Interest II-LTM8, REMIC II Regular Interest
II-LTM9 and REMIC II Regular Interest II-LTM10 in the same proportion as
the Overcollateralization Increase Amount is allocated to the
Corresponding Certificates and the Uncertificated Principal Balance of the
REMIC II Regular Interest II-LTZZ shall be increased by such amount;
(ii) to Holders of REMIC II Regular Interest II-LT1SUB, REMIC II
Regular Interest II-LT1GRP, REMIC II Regular Interest II-LT2SUB, REMIC II
Regular Interest II- LT2GRP and REMIC II Regular Interest II-LTXX, pro
rata, in an amount equal to (A) the Uncertificated Interest for such
Distribution Date, plus (B) any amounts in respect thereof remaining
unpaid from previous Distribution Dates;
(iii) to the Holders of REMIC II Regular Interests, in an amount
equal to the remainder of the REMIC II Marker Allocation Percentage of
Available Funds for such Distribution Date after the distributions made
pursuant to clause (i) above, allocated as follows:
(a) to the Holders of REMIC II Regular Interest II-LTAA and
REMIC II Regular Interest II-LTP, 98.00% of such remainder (other
than amounts payable under clause (iv) below), until the
Uncertificated Balance of such REMIC II Regular Interest is reduced
to zero, provided, however, that REMIC II Regular Interest II-LTP
shall not be reduced until the Distribution Date immediately
following the expiration of the latest Prepayment Charge as
identified on the Prepayment Charge Schedule or any Distribution
Date thereafter, at which point such amount shall be distributed to
REMIC II Regular Interest II-LTP, until $100 has been distributed
pursuant to this clause;
(b) to the Holders of REMIC Regular Interest II-LTA1, REMIC II
Regular Interest II-LTA2, REMIC II Regular Interest II-LTA3, REMIC
II Regular Interest II-LTA4, REMIC II Regular Interest II-LTA5,
REMIC II Regular Interest II- LTM1, REMIC II Regular Interest
II-LTM2, REMIC II Regular Interest II-LTM3, REMIC II Regular
Interest II-LTM4, REMIC II Regular Interest II-LTM5, REMIC II
Regular Interest II-LTM6, REMIC II Regular Interest II-LTM7, REMIC
II Regular Interest II-LTM8, REMIC II Regular Interest II-LTM9 and
REMIC II Regular Interest II-LTM10, 1.00% of such remainder (other
than amounts payable under clause (iv) below), in the same
proportion as principal payments are allocated to the Corresponding
Certificates, until the Uncertificated Balances of such REMIC II
Regular Interests are reduced to zero;
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(c) to the Holders of REMIC II Regular Interest II-LTZZ, 1.00%
of such remainder (other than amounts payable under clause (iv)
below), until the Uncertificated Balance of such REMIC II Regular
Interest is reduced to zero; and
(d) any remaining amount to the Holders of the Class R
Certificates (in respect of the Class R-I Interest);
provided, however, that (i) 98.00% and (ii) 2.00% of any principal payments that
are attributable to an Overcollateralization Reduction Amount shall be allocated
to Holders of (i) REMIC II Regular Interest II-LTAA and REMIC II Regular
Interest II-LTP, in that order and (ii) REMIC II Regular Interest II-LTZZ,
respectively; provided that REMIC II Regular Interest II-LTP shall not be
reduced until the Distribution Date immediately following the expiration of the
latest Prepayment Charge as identified on the Prepayment Charge Schedule or any
Distribution Date thereafter, at which point such amount shall be distributed to
REMIC II Regular Interest II-LTP, until $100 has been distributed pursuant to
this clause; and
(iv) to the Holders of REMIC II Regular Interests, in an amount
equal to the remainder of the REMIC II Sub WAC Allocation Percentage of
Available Funds for such Distribution Date after the distributions made
pursuant to clause (i) above, such that distributions of principal shall
be deemed to be made to the REMIC II Regular Interests first, so as to
keep the Uncertificated Balance of each REMIC II Regular Interest ending
with the designation "GRP" equal to 0.01% of the aggregate Stated
Principal Balance of the Mortgage Loans in the related Loan Group; second,
to each REMIC II Regular Interest ending with the designation "SUB," so
that the Uncertificated Balance of each such REMIC II Regular Interest is
equal to 0.01% of the excess of (x) the aggregate Stated Principal Balance
of the Mortgage Loans in the related Loan Group over (y) the current
Certificate Principal Balance of the Class A Certificate in the related
Loan Group (except that if any such excess is a larger number than in the
preceding distribution period, the least amount of principal shall be
distributed to such REMIC II Regular Interests such that the REMIC II
Subordinated Balance Ratio is maintained); and third, any remaining
principal to REMIC II Regular Interest II- LTXX.
Notwithstanding the priorities and amounts of distribution of funds pursuant to
this Section 4.01(a)(1), actual distributions of Available Funds shall be made
only in accordance with Section 4.01(a)(2), (3) and (4).
(2)(I) On each Distribution Date, the Trustee shall withdraw from
the Distribution Account an amount equal to the Group I Interest Remittance
Amount and distribute to the Certificateholders the following amounts, in the
following order of priority:
(i) concurrently, to the Holders of each Class of Group I
Certificates, on a pro rata basis based on the entitlement of each such
Class, the Senior Interest Distribution Amount related to such
Certificates; and
(ii) concurrently, to the Holders of each Class of Group II
Certificates, on a pro rata basis based on the entitlement of each such
Class, the Senior Interest Distribution
113
Amount related to such Certificates, to the extent remaining undistributed
after the distribution of the Group II Interest Remittance Amount as set
forth in Section 4.01(a)(2)(II)(i) below.
(II) On each Distribution Date, the Trustee shall withdraw from the
Distribution Account an amount equal to the Group II Interest Remittance Amount
and distribute to the Certificateholders the following amounts, in the following
order of priority:
(i) concurrently, to the Holders of each Class of Group II
Certificates, on a pro rata basis based on the entitlement of each such
Class, the Senior Interest Distribution Amount related to such
Certificates; and
(ii) concurrently, to the Holders of each Class of Group I
Certificates, on a pro rata basis based on the entitlement of each such
Class, the Senior Interest Distribution Amount related to such
Certificates, to the extent remaining undistributed after the distribution
of the Group I Interest Remittance Amount as set forth in Section
4.01(a)(2)(I)(i) above.
(III) On each Distribution Date, following the distributions of
interest set forth in Sections 4.01(a)(I) and (II), the sum of the Group I
Interest Remittance Amount and the Group II Interest Remittance Amount remaining
will be distributed sequentially to the Class X-0, Xxxxx X-0, Class M-3, Class
M-4, Class M-5, Class M-6, Class M-7, Class M-8, Class M-9 and Class M-10
Certificates, in that order, in an amount equal to the Interest Distribution
Amount for each such Class.
(3)(I) On each Distribution Date (a) prior to the Stepdown Date or
(b) on which a Trigger Event is in effect, the Group I Principal Distribution
Amount shall be distributed in the following order of priority:
(i) to the Holders of the Group I Certificates (allocated among such
Certificates in the priority described below), until the Certificate
Principal Balance of each such Class has been reduced to zero; and
(ii) to the holders of the Group II Certificates (allocated among
such Certificates in the priority described below) after taking into
account the distribution of the Group II Principal Distribution Amount
already distributed as set forth in Sections 4.01(a)(3)(II), until the
Certificate Principal Balance of each Class in such group has been reduced
to zero.
(II) On each Distribution Date (a) prior to the Stepdown Date or (b)
on which a Trigger Event is in effect, the Group II Principal Distribution
Amount shall be distributed in the following order of priority:
(i) to the Holders of the Group II Certificates (allocated among
such Certificates in the priority described below), until the Certificate
Principal Balance of each such Class has been reduced to zero; and
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(ii) to the Holders of the Group I Certificates (allocated among
such Certificates in the priority described below) after taking into
account the distribution of the Group I Principal Distribution Amount
already distributed as set forth in Section 4.01(a)(3)(I) above, until the
Certificate Principal Balance of each Class in such group has been reduced
to zero.
(III) On each Distribution Date (a) prior to the Stepdown Date or
(b) on which a Trigger Event is in effect, distributions in respect of principal
to the extent of the sum of the Group I Principal Distribution Amount and the
Group II Principal Distribution Amount remaining undistributed for such
Distribution Date will be made sequentially to the Class X-0, Xxxxx X-0, Class
M-3, Class M-4, Class M-5, Class M-6, Class M-7, Class M-8, Class M-9 and Class
M-10 Certificates, in that order, until the Certificate Principal Balance of
each such Class has been reduced to zero.
(V) On each Distribution Date (a) on or after the Stepdown Date and
(b) on which a Trigger Event is not in effect, the Group I Principal
Distribution Amount shall be distributed in the following order of priority:
(i) to the Holders of the Group I Certificates (allocated among such
Certificates in the priority described below), the Senior Group I
Principal Distribution Amount, until the Certificate Principal Balances
thereof have been reduced to zero; and
(ii) to the Holders of the Group II Certificates (allocated among
such Certificates in the priority described below) after taking into
account the distribution of the Group II Principal Distribution Amount as
set forth in Sections 4.01(a)(3)(VI), up to an amount equal to the Senior
Group II Principal Distribution Amount remaining undistributed, until the
Certificate Principal Balance of each Class in such group has been reduced
to zero.
(VI) On each Distribution Date (a) on or after the Stepdown Date and
(b) on which a Trigger Event is not in effect, the Group II Principal
Distribution Amount shall be distributed in the following order of priority:
(i) to the Holders of the Group II Certificates (allocated among
such Certificates in the priority described below), the Senior Group II
Principal Distribution Amount, until the Certificate Principal Balances
thereof have been reduced to zero; and
(ii) to the Holders of the Group I Certificates (allocated among
such Certificates in the priority described below), after taking into
account the distribution of the Group I Principal Distribution Amount as
set forth in Sections 4.01(a)(3)(V) above, up to an amount equal to the
Senior Group I Principal Distribution Amount remaining undistributed,
until the Certificate Principal Balance of each Class in such group has
been reduced to zero.
(VII) On each Distribution Date (a) on or after the Stepdown Date
and (b) on which a Trigger Event is not in effect, the sum of the Group I
Principal Distribution Amount and the Group II Principal Distribution Amount
remaining undistributed for such Distribution Date shall be distributed in the
following order of priority:
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(i) to the Holders of the Class M-1 Certificates, the Class M-1
Principal Distribution Amount until the Certificate Principal Balance
thereof has been reduced to zero;
(ii) to the Holders of the Class M-2 Certificates, the Class M-2
Principal Distribution Amount until the Certificate Principal Balance
thereof has been reduced to zero;
(iii) to the Holders of the Class M-3 Certificates, the Class M-3
Principal Distribution Amount until the Certificate Principal Balance
thereof has been reduced to zero;
(iv) to the Holders of the Class M-4 Certificates, the Class M-4
Principal Distribution Amount until the Certificate Principal Balance
thereof has been reduced to zero;
(v) to the Holders of the Class M-5 Certificates, the Class M-5
Principal Distribution Amount until the Certificate Principal Balance
thereof has been reduced to zero;
(vi) to the Holders of the Class M-6 Certificates, the Class M-6
Principal Distribution Amount until the Certificate Principal Balance
thereof has been reduced to zero;
(vii) to the Holders of the Class M-7 Certificates, the Class M-7
Principal Distribution Amount until the Certificate Principal Balance
thereof has been reduced to zero;
(viii) to the Holders of the Class M-8 Certificates, the Class M-8
Principal Distribution Amount until the Certificate Principal Balance
thereof has been reduced to zero;
(ix) to the Holders of the Class M-9 Certificates, the Class M-9
Principal Distribution Amount until the Certificate Principal Balance
thereof has been reduced to zero; and
(x) to the Holders of the Class M-10 Certificates, the Class M-10
Principal Distribution Amount until the Certificate Principal Balance
thereof has been reduced to zero.
With respect to the Group I Certificates, all principal distributions will
be distributed concurrently, to the holders of the Class A-1 Certificates (in an
amount equal to the Class A-1 Allocation Percentage of the principal to be
distributed), until the Certificate Principal Balance of the Class A-1
Certificates has been reduced to zero and to the holders of the Class A-2
Certificates (in an amount equal to the Class A-2 Allocation Percentage of the
principal to be distributed), until the Certificate Principal Balance of the
Class A-2 Certificates has been reduced to zero; provided, however, on any
Distribution Date on which the aggregate Certificate Principal Balance of the
Subordinate Certificates has been reduced to zero, notwithstanding anything
contained herein to the contrary, all distributions of principal to the Group I
Certificates will be distributed concurrently, on a pro rata basis based on the
Certificate Principal Balance of each such Class.
With respect to the Group II Certificates, all principal distributions
will be distributed sequentially, to the Class A-3, Class A-4 and Class A-5
Certificates, in that order, until their respective Certificate Principal
Balances have been reduced to zero; provided, however, on any Distribution Date
on which the aggregate Certificate Principal Balance of the Subordinate
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Certificates has been reduced to zero, notwithstanding anything contained herein
to the contrary, all distributions of principal to the Group II Certificates
will be distributed concurrently, on a pro rata basis based on the Certificate
Principal Balance of each such Class.
(4) On each Distribution Date, the Net Monthly Excess Cashflow shall
be distributed as follows:
(I) to the Holders of the Class or Classes of Certificates then
entitled to receive distributions in respect of principal, in an amount
equal to the Overcollateralization Increase Amount, applied as part of the
Group I Principal Distribution Amount or the Group II Principal
Distribution Amount, as applicable, to reduce the Certificate Principal
Balance of such Certificates until the aggregate Certificate Principal
Balance of such Certificates is reduced to zero;
(II) sequentially to the Class X-0, Xxxxx X-0, Class M-3, Class M-4,
Class M-5, Class M-6, Class M-7, Class M-8, Class M-9 and Class M-10
Certificates, in that order, in each case up to the Interest Carry Forward
Amount related to each such Class of Certificates for such Distribution
Date;
(III) sequentially to the Class X-0, Xxxxx X-0, Class M-3, Class
M-4, Class M-5, Class M-6, Class M-7, Class M-8, Class M-9 and Class M-10
Certificates, in that order, in each case up to the related Allocated
Realized Loss Amount related to each such Class of Certificates for such
Distribution Date;
(IV) to the Net WAC Rate Carryover Reserve Account, the amount
required by Section 4.10(b), after taking into account amounts received
under the Cap Contracts;
(V) to the Holders of the Class CE Certificates the related Interest
Distribution Amount for such Distribution Date and the
Overcollateralization Reduction Amount for such Distribution Date; and
(VI) to the Holders of the Class R Certificates, any remaining
amounts; provided that if such Distribution Date is the Distribution Date
immediately following the expiration of the latest Prepayment Charge term
as identified on the Mortgage Loan Schedule or any Distribution Date
thereafter, then any such remaining amounts shall be distributed first, to
the Holders of the Class P Certificates, until the Certificate Principal
Balance thereof has been reduced to zero; and second, to the Holders of
the Class R Certificates.
On each Distribution Date, following the foregoing distributions, an
amount equal to the amount of Subsequent Recoveries deposited into the
Collection Account pursuant to Section 3.05 and included in the Available Funds
for such Distribution Date shall be applied to increase the Certificate
Principal Balance of the Class of Certificates with the Highest Priority up to
the extent of such Realized Losses previously allocated to that Class of
Certificates pursuant to Section 4.04. An amount equal to the amount of any
remaining Subsequent Recoveries shall be applied to increase the Certificate
Principal Balance of the Class of Certificates with the next Highest Priority,
up to the amount of such Realized Losses previously allocated to that Class of
Certificates pursuant to Section
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4.04, and so on. Holders of such Certificates will not be entitled to any
distribution in respect of interest on the amount of such increases for any
Interest Accrual Period preceding the Distribution Date on which such increase
occurs. Any such increases shall be applied to the Certificate Principal Balance
of each Certificate of such Class in accordance with its respective Percentage
Interest.
(b) On each Distribution Date, after making the distributions of the
Available Funds as set forth above, the Trustee shall first, withdraw from the
Net WAC Rate Carryover Reserve Account all net income from the investment of
funds in the Net WAC Rate Carryover Reserve Account and distribute such amount
to the Holders of the Class CE Certificates, and second, withdraw from the Net
WAC Rate Carryover Reserve Account, to the extent of amounts remaining on
deposit therein, the amount of any Net WAC Rate Carryover Amount for such
Distribution Date and distribute such amount as follows:
first, concurrently, to each Class of Adjustable-Rate Class A Certificates
(other than the Class A-1 Certificates), the related Cap Amount for such
Distribution Date, in each case up to a maximum amount equal to the related Net
WAC Carryover Amount;
second, sequentially, to the Class X-0, Xxxxx X-0, Class M-3, Class M-4,
Class M-5, Class M-6, Class M-7, Class M-8, Class M-9 and Class M-10
Certificates, in that order, the related Cap Amount for such Distribution Date,
in each case up to a maximum amount equal to the related Net WAC Carryover
Amount;
third, concurrently, to each Class of Class A Certificates, the related
Net WAC Carryover Amount remaining undistributed pursuant to clause first above,
on a pro rata basis based on such respective remaining Net WAC Rate Carryover
Amounts; and
fourth, sequentially, to the Class X-0, Xxxxx X-0, Class M-3, Class M-4,
Class M-5, Class M-6, Class M-7, Class M-8, Class M-9 and Class M-10
Certificates, in that order, the related Net WAC Carryover Amount remaining
undistributed pursuant to clause second above.
On each Distribution Date, the Trustee shall withdraw any amounts
then on deposit in the Distribution Account that represent Prepayment Charges
collected by the Master Servicer, Prepayment Charges payable by the Master
Servicer pursuant to Section 2.03(b)(ii)(A) and Master Servicer Prepayment
Charge Payment Amounts payable by the Master Servicer pursuant to Section
2.03(b)(ii)(B), subject to Section 2.03(b)(iii), in each case to the extent not
related to Principal Prepayments occurring after the related Prepayment Period,
and the Trustee shall distribute such amounts to the Holders of the Class P
Certificates. Such distributions shall not be applied to reduce the Certificate
Principal Balance of the Class P Certificates.
On each Distribution Date, after the payment of any Net WAC Rate
Carryover Amounts on the Adjustable-Rate Certificates, any amounts remaining in
the Net WAC Rate Reserve Account (representing payments received by the Trustee
under the Cap Contracts), shall be payable to the Trustee. For so long as any
Adjustable-Rate Certificates are held by the Seller or any of its Affiliates,
the Trustee shall not distribute any Cap Amounts for such Certificates to the
Seller or any of its Affiliates and the Trustee shall retain any such amounts as
additional compensation for its role in administering the Cap Contracts.
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(c) All distributions made with respect to each Class of
Certificates on each Distribution Date shall be allocated pro rata among the
outstanding Certificates in such Class based on their respective Percentage
Interests. Payments in respect of each Class of Certificates on each
Distribution Date shall be made to the Holders of the respective Class of record
on the related Record Date (except as otherwise provided in Section 4.01(e) or
Section 9.01 respecting the final distribution on such Class), based on the
aggregate Percentage Interest represented by their respective Certificates, and
shall be made by wire transfer of immediately available funds to the account of
any such Holder at a bank or other entity having appropriate facilities
therefor, if such Holder shall have so notified the Trustee in writing at least
five Business Days prior to the Record Date immediately prior to such
Distribution Date, or otherwise by check mailed by first class mail to the
address of such Holder appearing in the Certificate Register. The final
distribution on each Certificate shall be made in like manner, but only upon
presentment and surrender of such Certificate at the office of the Trustee
maintained for such purpose pursuant to Section 8.12 or such other location
specified in the notice to Certificateholders of such final distribution.
Each distribution with respect to a Book-Entry Certificate shall be
paid to the Depository, as Holder thereof, and the Depository shall be
responsible for crediting the amount of such distribution to the accounts of its
Depository Participants in accordance with its normal procedures. Each
Depository Participant shall be responsible for disbursing such distribution to
the Certificate Owners that it represents and to each indirect participating
brokerage firm (a "brokerage firm" or "indirect participating firm") for which
it acts as agent. Each brokerage firm shall be responsible for disbursing funds
to the Certificate Owners that it represents. None of the Trustee, the
Certificate Registrar, the Depositor or the Master Servicer shall have any
responsibility therefor except as otherwise provided by this Agreement or
applicable law.
(d) The rights of the Certificateholders to receive distributions in
respect of the Certificates, and all interests of the Certificateholders in such
distributions, shall be as set forth in this Agreement. Neither the Holders of
any Class of Certificates nor the Trustee nor the Master Servicer shall in any
way be responsible or liable to the Holders of any other Class of Certificates
in respect of amounts properly previously distributed on the Certificates.
(e) [reserved].
(f) Except as otherwise provided in Section 9.01, whenever the
Trustee expects that the final distribution with respect to any Class of
Certificates shall be made on the next Distribution Date, the Trustee shall, no
later than five (5) days after the related Determination Date, mail to each
Holder on such date of such Class of Certificates a notice to the effect that:
(i) the Trustee expects that the final distribution with respect to
such Class of Certificates shall be made on such Distribution Date, but
only upon presentation and surrender of such Certificates at the office of
the Trustee therein specified or its agent, and
(ii) no interest shall accrue on such Certificates from and after
the end of the related Interest Accrual Period.
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Any funds not distributed to any Holder or Holders of Certificates
of such Class on such Distribution Date because of the failure of such Holder or
Holders to tender their Certificates shall, on such date, be set aside and held
in trust by the Trustee and credited to the account of the appropriate
non-tendering Holder or Holders. If any Certificates as to which notice has been
given pursuant to this Section 4.01(e) shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Trustee shall mail a second notice to the remaining non- tendering
Certificateholders to surrender their Certificates for cancellation in order to
receive the final distribution with respect thereto. If within one year after
the second notice all such Certificates shall not have been surrendered for
cancellation, the Trustee shall, directly or through an agent, mail a final
notice to remaining non-tendering Certificateholders concerning surrender of
their Certificates but shall continue to hold any remaining funds for the
benefit of non-tendering Certificateholders. The costs and expenses of
maintaining the funds in trust and of contacting such Certificateholders shall
be paid out of the assets remaining in such trust fund. If within one year after
the final notice any such Certificates shall not have been surrendered for
cancellation, the Trustee shall pay to the Representative all remaining amounts,
and all rights of non-tendering Certificateholders in or to such amounts shall
thereupon cease. No interest shall accrue or be payable to any Certificateholder
on any amount held in trust by the Trustee as a result of such
Certificateholder's failure to surrender its Certificate(s) for final payment
thereof in accordance with this Section 4.01(e).
(g) Notwithstanding anything to the contrary herein, (i) in no event
shall the Certificate Principal Balance of a Class A Certificate or a Mezzanine
Certificate be reduced more than once in respect of any particular amount both
(a) allocated to such Certificate in respect of Realized Losses pursuant to
Section 4.04 and (b) distributed to the Holder of such Certificate in reduction
of the Certificate Principal Balance thereof pursuant to this Section 4.01 from
Net Monthly Excess Cashflow and (ii) in no event shall the Uncertificated
Balance of a REMIC I Regular Interest to be reduced more than once in respect of
any particular amount both (a) allocated to such REMIC I Regular Interest in
respect of Realized Losses pursuant to Section 4.04 and (b) distributed on such
REMIC I Regular Interest in reduction of the Uncertificated Balance thereof
pursuant to this Section 4.01.
SECTION 4.02. Statements to Certificateholders.
On each Distribution Date, the Trustee shall prepare and make
available to each Holder of the Regular Certificates and the NIMS Insurer, a
statement as to the distributions made on such Distribution Date setting forth:
(i) the amount of the distribution made on such Distribution Date to the
Holders of the Certificates of each Class allocable to principal, and the
amount of distribution made on such Distribution Date to the Holders of
the Class P Certificates allocable to Prepayment Charges or Master
Servicer Prepayment Charge Payment Amounts;
(ii) the amount of the distribution made on such Distribution Date to the
Holders of the Certificates of each Class allocable to interest;
(iii) the aggregate Servicing Fee received by the Master Servicer during
the related Due Period and such other customary information as the Trustee
deems necessary or desirable,
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or which a Certificateholder reasonably requests, to enable
Certificateholders to prepare their tax returns;
(iv) the aggregate amount of Advances for such Distribution Date;
(v) the aggregate Stated Principal Balance of the Mortgage Loans and any
REO Properties as of the close of business on such Distribution Date;
(vi) the number, aggregate Stated Principal Balance, weighted average
remaining term to maturity and weighted average Mortgage Rate of the
Mortgage Loans as of the related Due Date and the number and aggregate
Stated Principal Balance of all Subsequent Mortgage Loans added during the
related Due Period;
(vii) the number and aggregate unpaid Stated Principal Balance of Mortgage
Loans (a) delinquent 30-59 days, (b) delinquent 60-89 days, (c) delinquent
90 or more days in each case, as of the last day of the preceding calendar
month, (d) as to which foreclosure proceedings have been commenced and (e)
with respect to which the related Mortgagor has filed for protection under
applicable bankruptcy laws, with respect to whom bankruptcy proceedings
are pending or with respect to whom bankruptcy protection is in force;
(viii) with respect to any Mortgage Loan that became an REO Property
during the preceding calendar month, the loan number of such Mortgage
Loan, the unpaid Stated Principal Balance and the Stated Principal Balance
of such Mortgage Loan as of the date it became an REO Property;
(ix) the book value and the Stated Principal Balance of any REO Property
as of the close of business on the last Business Day of the calendar month
preceding the Distribution Date;
(x) the aggregate amount of Principal Prepayments made during the related
Prepayment Period;
(xi) the aggregate amount of Realized Losses incurred during the related
Prepayment Period (or, in the case of Bankruptcy Losses allocable to
interest, during the related Due Period), separately identifying whether
such Realized Losses constituted Bankruptcy Losses and the aggregate
amount of Realized Losses incurred since the Closing Date and the
aggregate amount of Subsequent Recoveries received during the related
Prepayment Period and the cumulative amount of Subsequent Recoveries
received since the Closing Date;
(xii) the aggregate amount of Extraordinary Trust Fund Expenses withdrawn
from the Collection Account or the Distribution Account for such
Distribution Date;
(xiii) the aggregate Certificate Principal Balance of each Class of
Certificates, after giving effect to the distributions, and allocations of
Realized Losses, made on such Distribution Date, separately identifying
any reduction thereof due to allocations of Realized Losses;
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(xiv) the Certificate Factor for each such Class of Certificates
applicable to such Distribution Date;
(xv) the Interest Distribution Amount in respect of the Class A
Certificates, the Mezzanine Certificates and the Class CE Certificates for
such Distribution Date and the Interest Carry Forward Amount, if any, with
respect to the Class A Certificates and the Mezzanine Certificates on such
Distribution Date, and in the case of the Class A Certificates, the
Mezzanine Certificates and the Class CE Certificates, separately
identifying any reduction thereof due to allocations of Realized Losses,
Prepayment Interest Shortfalls and Relief Act Interest Shortfalls;
(xvi) the aggregate amount of any Prepayment Interest Shortfall for such
Distribution Date, to the extent not covered by payments by the Master
Servicer pursuant to Section 4.03(e) or allocated to the Class CE
Certificates;
(xvii) the aggregate amount of Relief Act Interest Shortfalls for such
Distribution Date;
(xviii) the Overcollateralization Target Amount and the Credit Enhancement
Percentage for such Distribution Date;
(xix) the Overcollateralization Increase Amount, if any, for such
Distribution Date;
(xx) the Overcollateralization Reduction Amount, if any, for such
Distribution Date;
(xxi) with respect to any Mortgage Loan as to which foreclosure
proceedings have been concluded, the loan number and unpaid Stated
Principal Balance of such Mortgage Loan as of the date of such conclusion
of foreclosure proceedings;
(xxii) with respect to Mortgage Loans as to which a Final Liquidation has
occurred, the number of Mortgage Loans, the unpaid Stated Principal
Balance of such Mortgage Loans as of the date of such Final Liquidation
and the amount of proceeds (including Liquidation Proceeds and Insurance
Proceeds) collected in respect of such Mortgage Loans;
(xxiii) the respective Pass-Through Rates applicable to the Class A
Certificates, the Mezzanine Certificates and the Class CE Certificates for
such Distribution Date and the Pass-Through Rate applicable to the Class A
Certificates and the Mezzanine Certificates for the immediately succeeding
Distribution Date;
(xxiv) the amount on deposit in the Pre-Funding Accounts, the Interest
Coverage Account and the Net WAC Rate Carryover Reserve Account as of the
Determination Date;
(xxv) whether a Trigger Event is in effect;
(xxvi) for the distribution occurring on the Distribution Date immediately
following the end of the Funding Period, the final balance withdrawn from
the Pre-Funding Accounts pursuant to Section 4.07 that was not used to
purchase Subsequent Mortgage Loans and that is being
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distributed to the related Class A Certificateholders as a mandatory
prepayment of principal, if any, on such Distribution Date; and
(xxvii) the Net WAC Rate Carryover Amount for the Class A Certificates and
the Mezzanine Certificates, if any, for such Distribution Date and the
amount remaining unpaid after reimbursements therefor on such Distribution
Date and any amounts received under the Cap Contracts.
The Trustee shall make such statement (and, at its option, any
additional files containing the same information in an alternative format)
available each month to Certificateholders, the NIMS Insurer, the Master
Servicer and the Rating Agencies via the Trustee's internet website. The
Trustee's internet website shall initially be located at
https:\\xxx.xxxxxxxxxxxxxx.xx.xxx and assistance in using the website can be
obtained by calling the Trustee's investor relations desk at 0- 000-000-0000.
Parties that are unable to use the above distribution options are entitled to
have a paper copy mailed to them via first class mail by calling the investor
relations desk and indicating such. The Trustee shall have the right to change
the way such statements are distributed in order to make such distribution more
convenient and/or more accessible to the above parties and the Trustee shall
provide timely and adequate notification to all above parties regarding any such
changes.
In the case of information furnished pursuant to subclauses (i)
through (iii) above, the amounts shall be expressed as a dollar amount per
Single Certificate of the relevant Class.
Within a reasonable period of time after the end of each calendar
year, the Trustee shall furnish to the NIMS Insurer and each Person who at any
time during the calendar year was a Holder of a Regular Certificate a statement
containing the information set forth in subclauses (i) through (iii) above,
aggregated for such calendar year or applicable portion thereof during which
such person was a Certificateholder. Such obligation of the Trustee shall be
deemed to have been satisfied to the extent that substantially comparable
information shall be provided by the Trustee pursuant to any requirements of the
Code as from time to time are in force.
Within a reasonable period of time after the end of each calendar
year, the Trustee shall furnish to the NIMS Insurer and each Person who at any
time during the calendar year was a Holder of a Residual Certificate a statement
setting forth the amount, if any, actually distributed with respect to the
Residual Certificates, as appropriate, aggregated for such calendar year or
applicable portion thereof during which such Person was a Certificateholder.
Such obligation of the Trustee shall be deemed to have been satisfied to the
extent that substantially comparable information shall be prepared by the
Trustee and furnished to such Holders pursuant to the rules and regulations of
the Code as are in force from time to time.
The Trustee shall, upon request, furnish to each Certificateholder,
Certificate Owner and the NIMS Insurer, during the term of this Agreement, such
periodic, special, or other reports or information, whether or not provided for
herein, as shall be reasonable with respect to the Certificateholder, or
otherwise with respect to the purposes of this Agreement, all such reports or
information to be provided at the expense of the Certificateholder or
Certificate Owner in accordance with such reasonable and explicit instructions
and directions as the Certificateholder or Certificate
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Owner may provide. For purposes of this Section 4.02, the Trustee's duties are
limited to the extent that the Trustee receives timely reports as required from
the Master Servicer.
On each Distribution Date the Trustee shall provide Bloomberg
Financial Markets, L.P. ("Bloomberg") CUSIP level factors for each Class of
Certificates as of such Distribution Date, using a format and media mutually
acceptable to the Trustee and Bloomberg.
SECTION 4.03. Remittance Reports and Other Reports to the Trustee;
Advances; Payments in Respect of Prepayment Interest
Shortfalls.
(a) On the Master Servicer Reporting Date, the Master Servicer shall
deliver to the Trustee and the NIMS Insurer by telecopy (or by such other means
as the Master Servicer, the Trustee and the NIMS Insurer may agree from time to
time) a Remittance Report with respect to the related Distribution Date. Such
Remittance Report shall include (i) the amount of Advances to be made by the
Master Servicer in respect of the related Distribution Date, the aggregate
amount of Advances outstanding after giving effect to such Advances, and the
aggregate amount of Nonrecoverable Advances in respect of such Distribution Date
and (ii) such other information with respect to the Mortgage Loans as the
Trustee may reasonably require to perform the calculations necessary to make the
distributions contemplated by Section 4.01 and to prepare the statements to
Certificateholders contemplated by Section 4.02. The Trustee shall not be
responsible to recompute, recalculate or verify any information provided to it
by the Master Servicer.
Not later than fifteen days after each Distribution Date,
the Master Servicer shall forward to the Trustee, the NIMS Insurer and the
Depositor a statement prepared by the Master Servicer setting forth the status
of the Collection Account as of the close of business on such Distribution Date
and showing, for the period covered by such statement, the aggregate amount of
deposits into and withdrawals from the Collection Account of each category of
deposit specified in Section 3.04(b) and each category of withdrawal specified
in Section 3.05. Such statement may be in the form of the then current Xxxxxx
Xxx Monthly Accounting Report for its Guaranteed Mortgage Pass-Through Program
with appropriate additions and changes, and shall also include information as to
the aggregate of the outstanding Stated Principal Balances of all of the
Mortgage Loans as of the last day of the calendar month immediately preceding
such Distribution Date. Copies of such statement shall be provided by the
Trustee to any Certificateholder and to any Person identified to the Trustee as
a prospective transferee of a Certificate, upon request at the expense of the
requesting party, provided such statement is delivered by the Master Servicer to
the Trustee.
(b) The amount of Advances to be made by the Master Servicer for any
Distribution Date shall equal, subject to Section 4.03(d), the sum of (i) the
aggregate amount of Monthly Payments (with each interest portion thereof net of
the related Servicing Fee), due on the related Due Date in respect of the
Mortgage Loans, which Monthly Payments were delinquent as of the close of
business on the related Determination Date and (ii) with respect to each REO
Property, which REO Property was acquired during or prior to the related
Prepayment Period and as to which such REO Property an REO Disposition did not
occur during the related Prepayment Period, an amount equal to the excess, if
any, of the Monthly Payments (with each interest portion thereof net of the
related Servicing Fee) that would have been due on the related Due Date in
respect of the
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related Mortgage Loans, over the net income from such REO Property transferred
to the Distribution Account pursuant to Section 3.13 for distribution on such
Distribution Date.
On or before 3:00 p.m. New York time on the Master Servicer
Remittance Date, the Master Servicer shall remit in immediately available funds
to the Trustee for deposit in the Distribution Account an amount equal to the
aggregate amount of Advances, if any, to be made in respect of the Mortgage
Loans and REO Properties for the related Distribution Date either (i) from its
own funds or (ii) from the Collection Account, to the extent of funds held
therein for future distribution (in which case, it shall cause to be made an
appropriate entry in the records of Collection Account that amounts held for
future distribution have been, as permitted by this Section 4.03, used by the
Master Servicer in discharge of any such Advance) or (iii) in the form of any
combination of (i) and (ii) aggregating the total amount of Advances to be made
by the Master Servicer with respect to the Mortgage Loans and REO Properties.
Any amounts held for future distribution used by the Master Servicer to make a
Advance as permitted in the preceding sentence or withdrawn by the Master
Servicer as permitted in Section 3.05(a)(vii) in reimbursement of Advances
previously made shall be appropriately reflected in the Master Servicer's
records and replaced by the Master Servicer by deposit in the Collection Account
on or before any future Master Servicer Remittance Date to the extent that the
Available Funds for the related Distribution Date (determined without regard to
Advances to be made on the Master Servicer Remittance Date) shall be less than
the total amount that would be distributed to the Classes of Certificateholders
pursuant to Section 4.01 on such Distribution Date if such amounts held for
future distributions had not been so used to make Advances. The Trustee shall
provide notice to the Master Servicer and the NIMS Insurer by telecopy by the
close of business on any Master Servicer Remittance Date in the event that the
amount remitted by the Master Servicer to the Trustee on such date is less than
the Advances required to be made by the Master Servicer for the related
Distribution Date.
(c) The obligation of the Master Servicer to make such Advances is
mandatory, notwithstanding any other provision of this Agreement but subject to
(d) below, and, with respect to any Mortgage Loan or REO Property, shall
continue until a Final Recovery Determination in connection therewith or the
removal thereof from REMIC I pursuant to any applicable provision of this
Agreement, except as otherwise provided in this Section.
(d) Notwithstanding anything herein to the contrary, no Advance or
Servicing Advance shall be required to be made hereunder by the Master Servicer
if such Advance or Servicing Advance would, if made, constitute a Nonrecoverable
Advance or Nonrecoverable Servicing Advance. The determination by the Master
Servicer that it has made a Nonrecoverable Advance or a Nonrecoverable Servicing
Advance or that any proposed Advance or Servicing Advance, if made, would
constitute a Nonrecoverable Advance or Nonrecoverable Servicing Advance,
respectively, shall be evidenced by an Officers' Certificate of the Master
Servicer delivered to the Trustee and the NIMS Insurer.
(e) The Master Servicer shall deliver to the Trustee for deposit
into the Distribution Account on or before 3:00 p.m. New York time on the Master
Servicer Remittance Date from its own funds an amount ("Compensating Interest")
equal to the lesser of (i) the aggregate of the Prepayment Interest Shortfalls
for the related Distribution Date resulting solely from Principal Prepayments
during the related Prepayment Period and (ii) the amount of its aggregate
Servicing Fee
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for the most recently ended calendar month. The Master Servicer shall not have
the right to reimbursement for any amounts remitted to the Trustee in respect of
Prepayment Interest Shortfalls. Such amounts so remitted shall be included in
the Available Funds and distributed therewith on the next Distribution Date. The
Master Servicer shall not be obligated to pay any amounts with respect to Relief
Act Interest Shortfalls.
(f) With respect to each of the obligations of the Master Servicer
set forth in this Section 4.03 and the Specially Serviced Mortgage Loans, the
Master Servicer will confirm that such obligations will be assumed directly by
the Special Sub-Servicer pursuant to the terms of the Special Sub-Servicing
Agreement and any references to the Master Servicer in Section 4.03 in this
Agreement shall refer, in the Special Sub-Servicing Agreement, to the Special
Sub-Servicer with respect to the Specially Serviced Mortgage Loans.
SECTION 4.04. Allocation of Realized Losses.
(a) On or before each Determination Date, the Master Servicer shall
determine as to each Mortgage Loan and REO Property: (i) the total amount of
Realized Losses, if any, incurred in connection with any Final Recovery
Determinations made during the related Prepayment Period; (ii) whether and the
extent to which such Realized Losses constituted Bankruptcy Losses and (iii) the
respective portions of such Realized Losses allocable to interest and allocable
to principal. On or before each Determination Date, the Master Servicer shall
also determine as to each Mortgage Loan: (A) the total amount of Realized
Losses, if any, incurred in connection with any Deficient Valuations made during
the related Prepayment Period and (B) the total amount of Realized Losses, if
any, incurred in connection with Debt Service Reductions in respect of Monthly
Payments due during the related Due Period. The information described in the two
preceding sentences that is to be supplied by the Master Servicer shall be
evidenced by an Officers' Certificate delivered to the Trustee by the Master
Servicer on the Master Servicer Reporting Date immediately following the end of
(x) in the case of Bankruptcy Losses allocable to interest, the Due Period
during which any such Realized Loss was incurred, and (y) in the case of all
other Realized Losses, the Prepayment Period during which any such Realized Loss
was incurred.
(b) All Realized Losses on the Mortgage Loans shall be allocated by
the Trustee on each Distribution Date as follows: first, in reduction of
interest accrued on and otherwise distributable to the Class CE Certificates to
the extent of Net Monthly Excess Cashflow used to pay principal on the Class A
Certificates and Mezzanine Certificates under clause (i) under Section 4.01
hereof; second, in reduction of interest accrued on and otherwise distributable
to the Class CE Certificates to the extent of Net Monthly Excess Cashflow
available for distribution pursuant to clauses (II) through (VI) of Section
4.01(a)(4) hereof; and third, in reduction of the Certificate Principal Balance
of the Class CE Certificates (determined after taking into account all
distributions made on the Certificates on such Distribution Date), until the
Certificate Principal Balance thereof has been reduced to zero. If on any
Distribution Date, after all distributions are made by the Trustee pursuant to
Section 4.01 hereof, the aggregate Certificate Principal Balance of the Class A
Certificates, the Mezzanine Certificates and the Class P certificates exceeds
the sum of the Stated Principal Balance of the Mortgage Loans as of the last day
of the related Due Period (after taking into account prepayments during the
related Prepayment Period), the amount of such excess shall be allocated first,
to the Class M-10 Certificates, until the Certificate Principal Balance of such
Class
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has been reduced to zero; second, to the Class M-9 Certificates, until the
Certificate Principal Balances thereof has been reduced to zero; third, to the
Class M-8 Certificates, until the Certificate Principal Balance thereof has been
reduced to zero; fourth, to the Class M-7 Certificates, until the Certificate
Principal Balance thereof has been reduced to zero; fifth, to the Class M-6
Certificates, until the Certificate Principal Balance thereof has been reduced
to zero; sixth, to the Class M-5 Certificates, until the Certificate Principal
Balance thereof has been reduced to zero; seventh, to the Class M-4
Certificates, until the Certificate Principal Balance thereof has been reduced
to zero; eighth, to the Class M-3 Certificates, until the Certificate Principal
Balance thereof has been reduced to zero; ninth, to the Class M-2 Certificates,
until the Certificate Principal Balance thereof has been reduced to zero; and
tenth, to the Class M-1 Certificates, until the Certificate Principal Balance
thereof has been reduced to zero.
Any such allocation to a Class of Mezzanine Certificate on any
Distribution Date shall be made by reducing the Certificate Principal Balance
thereof (after the actual distributions to be made on such Distribution Date
pursuant to Section 4.01 hereof) by the amount so allocated; any allocation of
Realized Losses to a Class CE Certificate shall be made by reducing the amount
otherwise payable in respect thereof pursuant to Section 4.01(a)(4)(V). No
allocations of any Realized Losses shall be made to the Certificate Principal
Balances of the Class A Certificates or the Class P Certificates.
As used herein, an allocation of a Realized Loss on a "pro rata
basis" among two or more specified Classes of Certificates means an allocation
on a pro rata basis, among the various Classes so specified, to each such Class
of Certificates on the basis of their then outstanding Certificate Principal
Balances prior to giving effect to distributions to be made on such Distribution
Date. All Realized Losses and all other losses allocated to a Class of
Certificates hereunder shall be allocated among the Certificates of such Class
in proportion to the Percentage Interests evidenced thereby.
(c) All Realized Losses on the Group I Mortgage Loans shall be
allocated by the Trustee on each Distribution Date, first to REMIC I Regular
Interest I-LT1 and REMIC I Regular Interest I-LT1PF, until the Uncertificated
Balance of each such REMIC I Regular Interest has been reduced to zero; provided
however, with respect to the first three Distribution Dates, all Realized Losses
on the Initial Group I Mortgage Loans shall be allocated to REMIC 1 Regular
Interest I-LT1, until the Uncertificated Balance thereof has been reduced to
zero, and all Realized Losses on the Subsequent Group I Mortgage Loans shall be
allocated to REMIC I Regular Interest I-LT1PF until the Uncertificated Balance
thereof has been reduced to zero. All Realized Losses on the Group II Mortgage
Loans shall be allocated by the Trustee on each Distribution Date, first to
REMIC I Regular Interest I-LT2 and REMIC I Regular Interest I-LT2PF, until the
Uncertificated Balance of each such REMIC I Regular Interest has been reduced to
zero; provided however, with respect to the first three Distribution Dates, all
Realized Losses on the Initial Group II Mortgage Loans shall be allocated to
REMIC I Regular Interest I-LT2, until the Uncertificated Balance thereof has
been reduced to zero, and all Realized Losses on the Subsequent Group II
Mortgage Loans shall be allocated to REMIC I Regular Interest I-LT2PF until the
Uncertificated Balance thereof has been reduced to zero.
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(d) (i) The REMIC II Marker Percentage of all Realized Losses on the
Mortgage Loans shall be allocated by the Trustee on each Distribution Date to
the following REMIC II Regular Interests in the specified percentages, as
follows: first, to Uncertificated Interest payable to the REMIC II Regular
Interest II-LTAA and REMIC II Regular Interest II-LTZZ up to an aggregate amount
equal to the REMIC III Interest Loss Allocation Amount, 98% and 2%,
respectively; second, to the Uncertificated Balances of the REMIC II Regular
Interest II-LTAA and REMIC II Regular Interest II-LTZZ up to an aggregate amount
equal to the REMIC III Principal Loss Allocation Amount, 98% and 2%,
respectively; third, to the Uncertificated Balances of REMIC II Regular Interest
II-LTAA, REMIC II Regular Interest II-LTM10 and REMIC II Regular Interest II-
LTZZ, 98%, 1.00% and 1.00%, respectively, until the Uncertificated Balance of
REMIC II Regular Interest II-LTM10 has been reduced to zero; fourth, to the
Uncertificated Balances of REMIC II Regular Interest II-LTAA, REMIC II Regular
Interest II-LTM9 and REMIC II Regular Interest II- LTZZ, 98%, 1.00% and 1.00%,
respectively, until the Uncertificated Balance of REMIC II Regular Interest
II-LTM9 has been reduced to zero; fifth, to the Uncertificated Balances of REMIC
II Regular Interest II-LTAA, REMIC II Regular Interest II-LTM8 and REMIC II
Regular Interest II-LTZZ, 98%, 1.00%, and 1%, respectively, until the
Uncertificated Balance of REMIC II Regular Interest II-LTM8 has been reduced to
zero; sixth, to the Uncertificated Balances of REMIC II Regular Interest II-
LTAA, REMIC II Regular Interest III-LTM7, and REMIC II Regular Interest II-LTZZ,
98%, 1% and 1%, respectively, respectively, until the Uncertificated Balances of
REMIC II Regular Interest III- LTM7 have been reduced to zero; seventh, to the
Uncertificated Balances of REMIC II Regular Interest II-LTAA, REMIC II Regular
Interest II-LTM6, and REMIC II Regular Interest II-LTZZ, 98%, 1% and 1%,
respectively, until the Uncertificated Balances of REMIC II Regular Interest II-
LTM6 have been reduced to zero; eighth, to the Uncertificated Balances of REMIC
II Regular Interest II-LTAA, REMIC II Regular Interest II-LTM5 and REMIC II
Regular Interest II-LTZZ, 98%, 1% and 1%, respectively, until the Uncertificated
Balance of REMIC II Regular Interest II-LTM5 has been reduced to zero; ninth, to
the Uncertificated Balances of REMIC II Regular Interest II- LTAA, REMIC II
Regular Interest III-LTM4, and REMIC II Regular Interest II-LTZZ, 98%, 1% and
1%, respectively, respectively, until the Uncertificated Balances of REMIC II
Regular Interest III- LTM4 have been reduced to zero; tenth, to the
Uncertificated Balances of REMIC II Regular Interest II-LTAA, REMIC II Regular
Interest II-LTM3, and REMIC II Regular Interest II-LTZZ, 98%, 1% and 1%,
respectively, until the Uncertificated Balances of REMIC II Regular Interest
II-LTM3 have been reduced to zero; eleventh, to the Uncertificated Balances of
REMIC II Regular Interest II- LTAA, REMIC II Regular Interest II-LTM2 and REMIC
II Regular Interest II-LTZZ, 98%, 1% and 1%, respectively, until the
Uncertificated Balance of REMIC II Regular Interest II-LTM2 has been reduced to
zero; and twelfth, to the Uncertificated Balances of REMIC II Regular Interest
II-LTAA, REMIC II Regular Interest II-LTM1 and REMIC II Regular Interest
II-LTZZ, 98%, 1% and 1%, respectively, until the Uncertificated Balance of REMIC
II Regular Interest II-LTM1 has been reduced to zero.
(ii) The REMIC II Sub WAC Allocation Percentage of all Realized
Losses shall be applied after all distributions have been made on each
Distribution Date first, so as to keep the Uncertificated Balance of each REMIC
II Regular Interest ending with the designation "GRP" equal to 0.01% of the
aggregate Stated Principal Balance of the Mortgage Loans in the related Loan
Group; second, to each REMIC II Regular Interest ending with the designation
"SUB," so that the Uncertificated Balance of each such REMIC II Regular Interest
is equal to 0.01% of the excess of (x) the aggregate Stated Principal Balance of
the Mortgage Loans in the related Loan Group over (y)
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the current Certificate Principal Balance of the Class A Certificate in the
related Loan Group (except that if any such excess is a larger number than in
the preceding distribution period, the least amount of Realized Losses shall be
applied to such REMIC II Regular Interests such that the REMIC II Subordinated
Balance Ratio is maintained); and third, any remaining Realized Losses shall be
allocated to REMIC II Regular Interest II-LTXX.
SECTION 4.05. Compliance with Withholding Requirements.
Notwithstanding any other provision of this Agreement, the Trustee
shall comply with all federal withholding requirements respecting payments to
Certificateholders of interest or original issue discount that the Trustee
reasonably believes are applicable under the Code. The consent of
Certificateholders shall not be required for such withholding. In the event the
Trustee does withhold any amount from interest or original issue discount
payments or advances thereof to any Certificateholder pursuant to federal
withholding requirements, the Trustee shall indicate the amount withheld to such
Certificateholders.
SECTION 4.06. Commission Reporting.
(a) The Trustee shall reasonably cooperate with the Depositor in
connection with the Trust's satisfying the reporting requirements under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"). The Trustee
shall prepare on behalf of the Trust any Forms 8-K and 10-K customary for
similar securities as required by the Exchange Act and the Rules and Regulations
of the Commission thereunder, and the Depositor shall sign (or shall cause
another entity acceptable to the Commission to sign) and the Trustee shall file
(via the Commission's Electronic Data Gathering and Retrieval System) such forms
on behalf of the Depositor (or such other entity). The Depositor hereby grants
to the Trustee a limited power of attorney to execute any Form 8-K and file each
such document on behalf of the Depositor. Such power of attorney shall continue
until the earlier of (i) receipt by the Trustee from the Depositor of written
termination of such power of attorney and (ii) the termination of the Trust.
Notwithstanding anything herein to the contrary, the Depositor, and not the
Trustee, shall be responsible for executing each Form 10-K filed on behalf of
the Trust.
(b) Each Form 8-K shall be filed by the Trustee within 15 days after
each Distribution Date, with a copy of the statement to the Certificateholders
for such Distribution Date as an exhibit thereto. Prior to March 30th of each
year (or such earlier date as may be required by the Exchange Act and the Rules
and Regulations of the Commission), the Trustee shall file a Form 10- K, in
substance as required by applicable law or applicable Commission staff's
interpretations. Such Form 10-K shall include as exhibits the Master Servicer's
annual statement of compliance described under Section 3.19 and the accountant's
report described under Section 3.20, in each case to the extent they have been
timely delivered to the Trustee. If they are not so timely delivered, the
Trustee shall file an amended Form 10-K including such documents as exhibits
reasonably promptly after they are delivered to the Trustee. The Trustee shall
have no liability with respect to any failure to properly prepare or file such
periodic reports resulting from or relating to the Trustee's inability or
failure to obtain any information not resulting from its own negligence or
willful misconduct. The Form 10-K shall also include a certification in the form
attached hereto as Exhibit J-1 (the
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"Certification"), which shall be signed by the senior officer of the Depositor
in charge of securitization.
(c) In addition, the Trustee shall sign a certification (in the form
attached hereto as Exhibit J-2) for the benefit of the Depositor and its
officers, directors and Affiliates regarding certain aspects of items 1 through
3 of the Certification (provided, however, that the Trustee shall not undertake
an analysis of the accountant's report attached as an exhibit to the Form 10-K).
The Trustee's certification shall be delivered to the Depositor by no later than
March 18th of each year (or if such day is not a Business Day, the immediately
preceding Business Day) and the Depositor shall deliver the Certification to the
Trustee for filing no later than March 20th of each year (or if such day is not
a Business Day, the immediately preceding Business Day).
In addition, the Trustee shall indemnify and hold harmless the
Depositor and its officers, directors and Affiliates from and against any
losses, damages, penalties, fines, forfeitures, reasonable and necessary legal
fees and related costs, judgments and other costs and expenses arising out of or
based upon a breach of the Trustee's obligations under this Section 4.06 or the
Trustee's negligence, bad faith or willful misconduct in connection therewith.
The Depositor shall indemnify and hold harmless the Trustee and its officers,
directors and Affiliates from and against any losses, damages, penalties, fines,
forfeitures, reasonable and necessary legal fees and related costs, judgments
and other costs and expenses arising out of or based upon a breach of the
Depositor's obligations under this Section 4.06 or the Depositor's negligence,
bad faith or willful misconduct in connection therewith. If the indemnification
provided for herein is unavailable or insufficient to hold harmless the
Depositor or the Trustee, as applicable, then the other party, in connection
with a breach of its respective obligations under this Section 4.06 or its
respective negligence, bad faith or willful misconduct in connection therewith,
agrees that it shall contribute to the amount paid or payable by the other party
as a result of the losses, claims, damages or liabilities of the other party in
such proportion as is appropriate to reflect the relative fault of the Depositor
on the one hand and the Trustee on the other.
(d) Upon any filing with the Commission, the Trustee shall promptly
deliver to the Depositor a copy of any executed report, statement or
information.
(e) Prior to January 30 of the first year in which the Trustee is
able to do so under applicable law, the Trustee shall file a Form 15 Suspension
Notification with respect to the Trust.
(f) To the extent that, following the Closing Date, the Depositor
certifies that reports and certifications differing from those required under
this Section 4.06 comply with the reporting requirements under the Exchange Act,
the Trustee hereby agrees that it shall reasonably cooperate to amend the
provisions of this Section 4.06 (in accordance with Section 11.01) in order to
comply with such amended reporting requirements and such amendment of this
Section 4.06. Any such amendment may result in the reduction of the reports
filed by the Depositor under the Exchange Act. Notwithstanding the foregoing,
the Trustee shall not be obligated to enter into any amendment pursuant to this
Section that adversely affects its obligations and immunities under this
Agreement.
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SECTION 4.07. Pre-Funding Accounts.
(a) No later than the Closing Date, the Trustee shall establish and
maintain two segregated trust accounts that are each Eligible Accounts, which
shall be titled (i) "Group I Pre- Funding Account, Deutsche Bank National Trust
Company, as Trustee for the registered holders of Argent Securities Inc.,
Asset-Backed Pass-Through Certificates, Series 2004-W7" (the "Group I Pre-
Funding Account") and (ii) "Group II Pre-Funding Account, Deutsche Bank National
Trust Company, as Trustee for the registered holders of Argent Securities Inc.,
Asset-Backed Pass-Through Certificates, Series 2004-W7" (the "Group II
Pre-Funding Account"). The Trustee shall, promptly upon receipt, deposit in the
applicable Pre-Funding Account and retain therein the Original Group I
Pre-Funded Amount or the Original Group II Pre-Funding Account, as applicable,
remitted on the Closing Date to the Trustee by the Depositor. Funds deposited in
the Pre-Funding Accounts shall be held in trust by the Trustee for the
Certificateholders for the uses and purposes set forth herein.
(b) The Trustee shall invest funds deposited in the Pre-Funding
Accounts in Permitted Investments of the kind described in clauses (i), (v) or
(vi) of the definition of Permitted Investments, as specified in a written
direction from the Master Servicer, with a maturity date no later than the
second Business Day preceding each Distribution Date. For federal income tax
purposes, the holder of the largest Percentage Interest of the Residual
Certificates shall be the owner of the Pre-Funding Accounts and shall report all
items of income, deduction, gain or loss arising therefrom. The Master Servicer
shall deposit in the applicable Pre-Funding Account the amount of any net loss
incurred in respect of any such Permitted Investment immediately upon
realization of such loss without any right of reimbursement therefor. The
Pre-Funding Accounts shall not be assets of any Trust REMIC.
(c) Amounts on deposit in the Pre-Funding Accounts shall be
withdrawn by the Trustee as follows:
(i) on any Subsequent Transfer Date, the Trustee shall withdraw from
the related Pre-Funding Account an amount equal to 100% of the Stated
Principal Balances of the Subsequent Mortgage Loans transferred and
assigned to the Trustee for deposit in the Mortgage Pool on such
Subsequent Transfer Date and pay such amount to or upon the order of the
Depositor upon satisfaction of the conditions set forth in Section 2.09
with respect to such transfer and assignment;
(ii) if the amount on deposit in the related Pre-Funding Account has
not been reduced to zero during the Funding Period, on the day of the
termination of the Funding Period, the Trustee shall deposit into the
Distribution Account any amounts remaining in the Pre-Funding Account to
be held uninvested;
(iii) to withdraw any amount not required to be deposited in the
Pre-Funding Accounts or deposited therein in error;
(iv) to distribute to the Interest Coverage Account any income and
gain realized from the investment of funds in the Pre-Funding Accounts;
and
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(v) to clear and terminate the Pre-Funding Accounts upon the earlier
to occur of (A) the day immediately following the end of the Funding
Period and (B) the termination of this Agreement, with any amounts
remaining on deposit therein being paid to the Holders of the Certificates
then entitled to distributions in respect of principal.
SECTION 4.08. Interest Coverage Account.
(a) No later than the Closing Date, the Trustee shall establish and
maintain a segregated trust account that is an Eligible Account, which shall be
titled "Interest Coverage Account, Deutsche Bank National Trust Company, as
Trustee for the registered holders of Argent Securities Inc., Asset-Backed
Pass-Through Certificates, Series 2004-W7" (the "Interest Coverage Account").
The Trustee shall, promptly upon receipt, deposit in the Interest Coverage
Account and retain therein the Interest Coverage Amount, remitted on the Closing
Date to the Trustee by the Depositor. Funds deposited in the Interest Coverage
Account shall be held in trust by the Trustee for the Certificateholders for the
uses and purposes set forth herein
(b) The Trustee shall invest funds deposited in the Interest
Coverage Account in Permitted Investments of the kind described in clauses (i),
(v) or (vi) of the definition of Permitted Investments, as specified in a
written direction from the Master Servicer, with a maturity date no later than
the second Business Day preceding each Distribution Date. For federal income tax
purposes, the holder of the largest Percentage Interest of the Residual
Certificates shall be the owner of the Interest Coverage Account and shall
report all items of income, deduction, gain or loss arising therefrom. At no
time will the Interest Coverage Account be an asset of any Trust REMIC. All
income and gain realized from investment of funds deposited in the Interest
Coverage Account shall be for the sole and exclusive benefit of the Master
Servicer and shall be remitted by the Trustee to the Master Servicer on the
first Business Day following each Distribution Date. The Master Servicer shall
deposit in the Interest Coverage Account the amount of any net loss incurred in
respect of any such Permitted Investment immediately upon realization of such
loss.
(c) On each Distribution Date during the Funding Period and on the
last day of the Funding Period, the Trustee shall withdraw from the Interest
Coverage Account and deposit in the Distribution Account an amount equal to 30
days' interest on the excess, if any, of the Original Pre-Funded Amounts, over
the aggregate Principal Balance of Subsequent Mortgage Loans that both (i) had a
Due Date during the Due Period relating to such Distribution Date and (ii) had a
Subsequent Cut-off Date prior to the first day of the month in which such
Distribution Date occurs, at a per annum rate equal to the weighted average
Pass-Through Rate of the Offered Certificates for such Distribution Date, with
the Pass-Through Rate on the Offered Certificates, solely for the purposes of
the foregoing calculation, multiplied by a fraction, the numerator of which is
the actual number of days in the Accrual Period for such Class for such
Distribution Date, and the denominator of which is 30. Such withdrawal and
deposit shall be treated as a contribution of cash by the Master Servicer to
REMIC I. Immediately following any such withdrawal and deposit, and immediately
following the conveyance of any Subsequent Mortgage Loans to the Trust on any
Subsequent Transfer Date, the Trustee shall withdraw from the Interest Coverage
Account and remit to the Master Servicer or its designee an amount equal to the
excess, if any, of the amount remaining in the Interest Coverage Account over
the amount that would be required to be withdrawn therefrom (assuming sufficient
funds therein) pursuant to the second preceding sentence on each subsequent
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Distribution Date, if any, that will occur during the Funding Period or that
will be the Distribution Date immediately following the end of the Funding
Period, if no Subsequent Mortgage Loans were acquired by the Trust Fund after
the end of the Prepayment Period relating to the current Distribution Date
(assuming that LIBOR remains constant at the level of LIBOR applicable to the
calculation of the Pass-Through Rate for the A-1 Certificates for the current
Distribution Date).
(d) Upon the earlier of (i) the Distribution Date immediately
following the end of the Funding Period, (ii) the reduction of the aggregate
Certificate Principal Balance of the Class A Certificates and the Mezzanine
Certificates to zero or (iii) the termination of this Agreement in accordance
with Section 9.01, any amount remaining on deposit in the Interest Coverage
Account after distributions pursuant to paragraph (c) above shall be withdrawn
by the Trustee and paid to the Depositor or its designee.
SECTION 4.09. [Reserved].
SECTION 4.10 Net WAC Rate Carryover Reserve Account.
(a) No later than the Closing Date, the Trustee shall establish and
maintain with itself, as agent for the Trustee, a separate, segregated trust
account titled, "Net WAC Rate Carryover Reserve Account, Deutsche Bank National
Trust Company, as Trustee, in trust for the registered holders of Argent
Securities Inc., Asset-Backed Pass-Through Certificates, Series 0000-X0." Xx the
Closing Date, the Depositor shall deposit, or cause to be deposited, into the
Net WAC Rate Carryover Reserve Account $1,000. In addition, the amount in the
Net WAC Rate Carryover Reserve Account shall include any payments received by
the Trustee under the Cap Contracts and deposited into the Net WAC Rate
Carryover Reserve Account for the benefit of the Holders of the Offered
Certificates.
(b) On each Distribution Date as to which there is a Net WAC Rate
Carryover Amount payable to the Class A Certificates or the Mezzanine
Certificates, the Trustee has been directed by the Class CE Certificateholders
to, and therefore shall, deposit into the Net WAC Rate Carryover Reserve Account
the amount of such Net WAC Rate Carryover Amount, rather than distributing such
amounts to the Class CE Certificateholders. On each such Distribution Date, the
Trustee shall hold all such amounts for the benefit of the Holders of the Class
A Certificates and the Mezzanine Certificates, and shall distribute such amounts
to the Holders of the Class A Certificates and the Mezzanine Certificates in the
amounts and priorities set forth in Section 4.01(b). If no Net WAC Rate
Carryover Amounts are payable on a Distribution Date, the Trustee shall deposit
into the Net WAC Rate Carryover Reserve Account on behalf of the Class CE
Certificateholders, from amounts otherwise distributable to the Class CE
Certificateholders, an amount such that when added to other amounts already on
deposit in the Net WAC Rate Carryover Reserve Account, the aggregate amount on
deposit therein is equal to $1,000.
(c) For federal and state income tax purposes, the Class CE
Certificateholders shall be deemed to be the owners of the Net WAC Rate
Carryover Reserve Account and all amounts deposited into the Net WAC Rate
Carryover Reserve Account (other than the initial deposit therein of $1,000)
shall be treated as amounts distributed by REMIC II to the Holders of the Class
CE Interest and by REMIC III to the Holders of the Class CE Certificates. Upon
the termination of the
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Trust, or the payment in full of the Class A Certificates and the Mezzanine
Certificates, all amounts remaining on deposit in the Net WAC Rate Carryover
Reserve Account shall be released by the Trust and distributed to the Class CE
Certificateholders or their designees. The Net WAC Rate Carryover Reserve
Account shall be part of the Trust but not part of any REMIC and any payments to
the Holders of the Class A Certificates or the Mezzanine Certificates of Net WAC
Rate Carryover Amounts shall not be payments with respect to a "regular
interest" in a REMIC within the meaning of Code Section 860(G)(a)(1).
(d) By accepting a Class CE Certificate, each Class CE
Certificateholder hereby agrees to direct the Trustee, and the Trustee hereby is
directed, to deposit into the Net WAC Rate Carryover Reserve Account the amounts
described above on each Distribution Date as to which there is any Net WAC Rate
Carryover Amount rather than distributing such amounts to the Class CE
Certificateholders. By accepting a Class CE Certificate, each Class CE
Certificateholder further agrees that such direction is given for good and
valuable consideration, the receipt and sufficiency of which is acknowledged by
such acceptance.
(e) At the written direction of the Holders of a majority in
Percentage Interest in the Class CE Certificates, the Trustee shall direct any
depository institution maintaining the Net WAC Rate Carryover Reserve Account to
invest the funds in such account in one or more Permitted Investments bearing
interest or sold at a discount, and maturing, unless payable on demand, (i) no
later than the Business Day immediately preceding the date on which such funds
are required to be withdrawn from such account pursuant to this Agreement, if a
Person other than the Trustee or an Affiliate manages or advises such
investment, and (ii) no later than the date on which such funds are required to
be withdrawn from such account pursuant to this Agreement, if the Trustee or an
Affiliate manages or advises such investment. If no investment direction of the
Holders of a majority in Percentage Interest in the Class CE Certificates with
respect to the Net WAC Rate Carryover Reserve Account is received by the
Trustee, the Trustee shall invest the funds in the Deutsche Bank Institutional
Cash Management Fund 541 so long as it is a Permitted Investment. Interest
earned on such investment shall be deposited into the Net WAC Rate Carryover
Reserve Account.
(f) For federal tax return and information reporting, the right of
the Holders of the Mezzanine Certificates to receive payments from the Net WAC
Rate Carryover Reserve Account in respect of any Net Wac Rate Carryover Amount
may be obtained from the Trustee upon request. Such information will be provided
to the Trustee by the Underwriter on or prior to the Closing Date.
ARTICLE V
THE CERTIFICATES
SECTION 5.01. The Certificates.
(a) The Certificates in the aggregate shall represent the entire
beneficial ownership interest in the Mortgage Loans and all other assets
included in REMIC I. At the Closing Date, the aggregate Certificate Principal
Balance of the Certificates shall equal the aggregate Stated Principal Balance
of the Mortgage Loans.
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The Certificates shall be substantially in the forms annexed hereto
as Exhibits A-1 through A-19. The Certificates of each Class shall be issuable
in registered form only, in denominations of authorized Percentage Interests as
described in the definition thereof. Each Certificate shall share ratably in all
rights of the related Class.
Upon original issue, the Certificates shall be executed and
delivered by the Trustee and the Trustee shall cause the Certificates to be
authenticated by the Certificate Registrar to or upon the order of the
Depositor. The Certificates shall be executed and attested by manual or
facsimile signature on behalf of the Trustee by an authorized signatory.
Certificates bearing the manual or facsimile signatures of individuals who were
at any time the proper officers of the Trustee shall bind the Trustee
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Certificates or did not
hold such offices at the date of such Certificates. No Certificate shall be
entitled to any benefit under this Agreement or be valid for any purpose, unless
there appears on such Certificate a certificate of authentication substantially
in the form provided herein executed by the Certificate Registrar by manual
signature, and such certificate of authentication shall be conclusive evidence,
and the only evidence, that such Certificate has been duly authenticated and
delivered hereunder. All Certificates shall be dated the date of their
authentication.
(b) The Class A Certificates and the Mezzanine Certificates shall
initially be issued as one or more Certificates held by the Book-Entry Custodian
or, if appointed to hold such Certificates as provided below, the Depository and
registered in the name of the Depository or its nominee and, except as provided
below, registration of such Certificates may not be transferred by the Trustee
except to another Depository that agrees to hold such Certificates for the
respective Certificate Owners with Ownership Interests therein. The Certificate
Owners shall hold their respective Ownership Interests in and to such
Certificates through the book-entry facilities of the Depository and, except as
provided below, shall not be entitled to definitive, fully registered
Certificates ("Definitive Certificates") in respect of such Ownership Interests.
All transfers by Certificate Owners of their respective Ownership Interests in
the Book-Entry Certificates shall be made in accordance with the procedures
established by the Depository Participant or brokerage firm representing such
Certificate Owner. Each Depository Participant shall only transfer the Ownership
Interests in the Book-Entry Certificates of Certificate Owners it represents or
of brokerage firms for which it acts as agent in accordance with the
Depository's normal procedures. The Trustee is hereby initially appointed as the
Book-Entry Custodian and hereby agrees to act as such in accordance herewith and
in accordance with the agreement that it has with the Depository authorizing it
to act as such. The Book-Entry Custodian may, and if it is no longer qualified
to act as such, the Book- Entry Custodian shall, appoint, by a written
instrument delivered to the Depositor, the Master Servicer, the Trustee (if the
Trustee is not the Book-Entry Custodian) and any other transfer agent (including
the Depository or any successor Depository) to act as Book-Entry Custodian under
such conditions as the predecessor Book-Entry Custodian and the Depository or
any successor Depository may prescribe, provided that the predecessor Book-Entry
Custodian shall not be relieved of any of its duties or responsibilities by
reason of any such appointment of other than the Depository. If the Trustee
resigns or is removed in accordance with the terms hereof, if it so elects, the
Depository shall immediately succeed to its predecessor's duties as Book-Entry
Custodian. The Depositor shall have the right to inspect, and to obtain copies
of, any Certificates held as Book-Entry Certificates by the Book-Entry
Custodian.
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The Trustee, the Master Servicer and the Depositor may for all
purposes (including the making of payments due on the Book-Entry Certificates)
deal with the Depository as the authorized representative of the Certificate
Owners with respect to the Book-Entry Certificates for the purposes of
exercising the rights of Certificateholders hereunder. The rights of Certificate
Owners with respect to the Book-Entry Certificates shall be limited to those
established by law and agreements between such Certificate Owners and the
Depository Participants and brokerage firms representing such Certificate
Owners. Multiple requests and directions from, and votes of, the Depository as
Holder of the Book-Entry Certificates with respect to any particular matter
shall not be deemed inconsistent if they are made with respect to different
Certificate Owners. The Trustee may establish a reasonable record date in
connection with solicitations of consents from or voting by Certificateholders
and shall give notice to the Depository of such record date.
If (i)(A) the Depositor advises the Trustee in writing that the
Depository is no longer willing or able to properly discharge its
responsibilities as Depository, and (B) the Depositor is unable to locate a
qualified successor or (ii) after the occurrence of a Master Servicer Event of
Default, Certificate Owners representing in the aggregate not less than 51% of
the Ownership Interests of the Book-Entry Certificates advise the Trustee
through the Depository, in writing, that the continuation of a book-entry system
through the Depository is no longer in the best interests of the Certificate
Owners, the Trustee shall notify all Certificate Owners, through the Depository,
of the occurrence of any such event and of the availability of Definitive
Certificates to Certificate Owners requesting the same. Upon surrender to the
Trustee of the Book-Entry Certificates by the Book-Entry Custodian or the
Depository, as applicable, accompanied by registration instructions from the
Depository for registration of transfer, the Trustee shall issue the Definitive
Certificates. Such Definitive Certificates shall be issued in minimum
denominations of $25,000 ($50,000 in the case of the Class X-0, Xxxxx X-0, Class
M-9 and Class M-10 Certificates), except that any beneficial ownership that was
represented by a Book-Entry Certificate in an amount less than $25,000
immediately prior to the issuance of a Definitive Certificate shall be issued in
a minimum denomination equal to the amount represented by such Book-Entry
Certificate. None of the Depositor, the Master Servicer or the Trustee shall be
liable for any delay in the delivery of such instructions and may conclusively
rely on, and shall be protected in relying on, such instructions. Upon the
issuance of Definitive Certificates all references herein to obligations imposed
upon or to be performed by the Depository shall be deemed to be imposed upon and
performed by the Trustee, to the extent applicable with respect to such
Definitive Certificates, and the Trustee shall recognize the Holders of the
Definitive Certificates as Certificateholders hereunder.
SECTION 5.02. Registration of Transfer and Exchange of Certificates.
(a) The Trustee shall cause to be kept at one of the offices or
agencies to be appointed by the Trustee in accordance with the provisions of
Section 8.12 a Certificate Register for the Certificates in which, subject to
such reasonable regulations as it may prescribe, the Trustee shall provide for
the registration of Certificates and of transfers and exchanges of Certificates
as herein provided. The Trustee shall initially serve as Certificate Registrar
for the purpose of registering Certificates and transfers and exchanges of
Certificates as herein provided. The Certificate Registrar may appoint, by a
written instrument delivered to the Master Servicer and the Depositor, any other
bank or trust company to act as Certificate Registrar under such conditions as
the predecessor Certificate Registrar may prescribe, provided that the
predecessor Certificate Registrar shall not be
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relieved of any of its duties or responsibilities hereunder by reason of such
appointment. If the Trustee shall at any time not be the Certificate Registrar,
the Trustee shall have and maintain the right to inspect the Certificate
Register or to obtain a copy thereof at all reasonable times, and to rely
conclusively upon a certificate of the Certificate Registrar as to the
information set forth in the Certificate Register.
(b) No transfer of any Class M-7 Certificate, Class M-8
Certificates, Class M-9 Certificates, Class M-10 Certificates, Class CE
Certificate, Class P Certificate or Residual Certificate shall be made unless
that transfer is made pursuant to an effective registration statement under the
Securities Act of 1933, as amended (the "1933 Act"), and an effective
registration or qualification under applicable state securities laws, or is made
in a transaction that does not require such registration or qualification. In
the event that such a transfer of a Class M-7 Certificate, Class M-8
Certificates, Class M-9 Certificates, Class M-10 Certificates, Class CE
Certificate, Class P Certificate or Residual Certificate is to be made without
registration or qualification (other than in connection with the initial
transfer of any such Certificate by the Depositor to an affiliate of the
Depositor), the Trustee and the Certificate Registrar shall each require receipt
of: (i) if such transfer is purportedly being made in reliance upon Rule 144A
under the 1933 Act, written certifications from the Certificateholder desiring
to effect the transfer and from such Certificateholder's prospective transferee,
substantially in the forms attached hereto as Exhibit F-1; and (ii) in all other
cases, an Opinion of Counsel satisfactory to it that such transfer may be made
without such registration (which Opinion of Counsel shall not be an expense of
the Depositor, the Trustee, the Master Servicer, in its capacity as such, or the
Trust Fund), together with copies of the written certification(s) of the
Certificateholder desiring to effect the transfer and/or such
Certificateholder's prospective transferee upon which such Opinion of Counsel is
based, if any. None of the Depositor, the Certificate Registrar or the Trustee
is obligated to register or qualify the Class M-7 Certificates, Class M-8
Certificates, Class M-9 Certificates, Class M-10 Certificates, the Class CE
Certificates, the Class P Certificates or the Residual Certificates under the
1933 Act or any other securities laws or to take any action not otherwise
required under this Agreement to permit the transfer of such Certificates
without registration or qualification. If a transfer of an Ownership Interest in
the Class M-7 Certificates, Class M-8 Certificates, Class M-9 Certificates,
Class M-10 Certificates are to be made without registration under the 1933 Act
(other than in connection with the initial issuance thereof or a transfer
thereof by the Depositor or one of its Affiliates), then the Certificate
Registrar shall refuse to register such transfer unless it receives (and upon
receipt, may conclusively rely upon) a certificate from the Certificateholder
desiring to effect such transfer and a certificate from such Certificateholder's
prospective transferee (which in the case of the Book-Entry Certificates, the
Certificateholder and the Certificateholder's prospective transferee will be
deemed to have represented such certification), to the effect that, among other
things, the transfer is being made to a qualified institutional buyer as defined
in Rule 144A under the Securities Act in accordance with Rule 144A. Any
Certificateholder desiring to effect the transfer of a Class M-7 Certificates,
Class M-8 Certificates, Class M-9 Certificates, Class M-10 Certificates, Class
CE Certificate, a Class P Certificate or a Residual Certificate shall, and does
hereby agree to, indemnify the Trustee, the Depositor, the Certificate Registrar
and the Master Servicer against any liability that may result if the transfer is
not so exempt or is not made in accordance with such federal and state laws.
Notwithstanding the foregoing, no certification or Opinion of
Counsel described in this Section 5.02(b) shall be required in connection with
the transfer, on the Closing Date, of any
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Class R Certificate by the Depositor to an "accredited investor" within the
meaning of Rule 501(d) of the 1933 Act.
(c) No transfer of a Class CE Certificate, Class P Certificate or
Residual Certificate or any interest in any such Certificates shall be made to
any Plan subject to ERISA or Section 4975 of the Code, any Person acting,
directly or indirectly, on behalf of any such Plan or any Person acquiring such
Certificates with "Plan Assets" of a Plan within the meaning of the Department
of Labor regulation promulgated at 29 C.F.R. ss. 2510.3-101 ("Plan Assets"), as
certified by such transferee in the form of Exhibit G, unless the Trustee is
provided with an Opinion of Counsel for the benefit of the Depositor, the
Trustee, the NIMS Insurer, the Trust Fund and the Master Servicer and on which
they may rely, to the effect that the purchase and holding of such Certificates
is permissible under applicable law, shall not constitute or result in any
non-exempt prohibited transaction under ERISA or Section 4975 of the Code and
shall not subject the Depositor, the Master Servicer, the NIMS Insurer, the
Trustee or the Trust Fund to any obligation or liability (including obligations
or liabilities under ERISA or Section 4975 of the Code) in addition to those
undertaken in this Agreement, which Opinion of Counsel shall not be an expense
of the Depositor, the Master Servicer, the NIMS Insurer, the Trustee or the
Trust Fund. Neither an Opinion of Counsel nor any certification shall be
required in connection with the initial transfer of any such Certificate by the
Depositor to an affiliate of the Depositor (in which case, the Depositor or any
affiliate thereof shall have deemed to have represented that such affiliate is
not a Plan or a Person investing Plan Assets) and the Trustee shall be entitled
to conclusively rely upon a representation (which, upon the request of the
Trustee, shall be a written representation) from the Depositor of the status of
such transferee as an affiliate of the Depositor.
Each beneficial owner of a Mezzanine Certificate or any interest
therein shall be deemed to have represented, by virtue of its acquisition or
holding of that Certificate or interest therein, that either (i) it is not a
Plan or acting, directly or indirectly, on behalf of a Plan or with Plan Assets,
(ii) it has acquired and is holding such Mezzanine Certificate in reliance on
the Underwriters' Exemption, and that it understands that there are certain
conditions to the availability of the Underwriters' Exemption, including that
the Mezzanine Certificates must be rated, at the time of purchase, not lower
than "BBB-" (or its equivalent) by Xxxxx'x, Fitch or S&P or (iii) (1) it is an
insurance company, (2) the source of funds used to acquire or hold the
Certificate or interest therein is an "insurance company general account," as
such term is defined in PTCE 95-60, and (3) the conditions in Sections I and III
of PTCE 95-60 have been satisfied.
If any Class CE Certificate, Class P Certificate, Residual
Certificate or Mezzanine Certificate or any interest therein is acquired or held
in violation of the provisions of the preceding two paragraphs, the next
preceding permitted beneficial owner shall be treated as the beneficial owner of
that Certificate retroactive to the date of transfer to the purported beneficial
owner. Any purported beneficial owner whose acquisition or holding of any such
Certificate or interest therein was effected in violation of the provisions of
the preceding two paragraphs shall indemnify and hold harmless the Depositor,
the Master Servicer, the Trustee, the NIMS Insurer and the Trust Fund from and
against any and all liabilities, claims, costs or expenses incurred by those
parties as a result of that acquisition or holding.
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(d)(i) Each Person who has or who acquires any Ownership Interest in
a Residual Certificate shall be deemed by the acceptance or acquisition of such
Ownership Interest to have agreed to be bound by the following provisions and to
have irrevocably authorized the Certificate Registrar or its designee under
clause (iii)(A) below to deliver payments to a Person other than such Person and
to negotiate the terms of any mandatory sale under clause (iii)(B) below and to
execute all instruments of Transfer and to do all other things necessary in
connection with any such sale. The rights of each Person acquiring any Ownership
Interest in a Residual Certificate are expressly subject to the following
provisions:
(A) Each Person holding or acquiring any Ownership Interest in a
Residual Certificate shall be a Permitted Transferee and shall promptly
notify the Certificate Registrar of any change or impending change in its
status as a Permitted Transferee.
(B) In connection with any proposed Transfer of any Ownership
Interest in a Residual Certificate, the Certificate Registrar shall
require delivery to it and shall not register the Transfer of any Residual
Certificate until its receipt of an affidavit and agreement (a "Transfer
Affidavit and Agreement"), in the form attached hereto as Exhibit F-2 from
the proposed Transferee, in form and substance satisfactory to the
Certificate Registrar, representing and warranting, among other things,
that such Transferee is a Permitted Transferee, that it is not acquiring
its Ownership Interest in the Residual Certificate that is the subject of
the proposed Transfer as a nominee, trustee or agent for any Person that
is not a Permitted Transferee, that for so long as it retains its
Ownership Interest in a Residual Certificate, it shall endeavor to remain
a Permitted Transferee, and that it has reviewed the provisions of this
Section 5.02(d) and agrees to be bound by them.
(C) Notwithstanding the delivery of a Transfer Affidavit and
Agreement by a proposed Transferee under clause (B) above, if a
Responsible Officer of the Certificate Registrar who is assigned to this
transaction has actual knowledge that the proposed Transferee is not a
Permitted Transferee, no Transfer of an Ownership Interest in a Residual
Certificate to such proposed Transferee shall be effected.
(D) Each Person holding or acquiring any Ownership Interest in a
Residual Certificate shall agree (x) to require a Transfer Affidavit and
Agreement from any other Person to whom such Person attempts to transfer
its Ownership Interest in a Residual Certificate and (y) not to transfer
its Ownership Interest unless it provides a Transferor Affidavit (in the
form attached hereto as Exhibit F-2), to the Certificate Registrar stating
that, among other things, it has no actual knowledge that such other
Person is not a Permitted Transferee.
(E) Each Person holding or acquiring an Ownership Interest in a
Residual Certificate, by purchasing an Ownership Interest in such
Certificate, agrees to give the Certificate Registrar written notice that
it is a "pass-through interest holder" within the meaning of temporary
Treasury regulation Section 1.67-3T(a)(2)(i)(A) immediately upon acquiring
an Ownership Interest in a Residual Certificate, if it is, or is holding
an Ownership Interest in a Residual Certificate on behalf of, a
"pass-through interest holder."
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(ii) The Certificate Registrar shall register the Transfer of any
Residual Certificate only if it shall have received the Transfer Affidavit and
Agreement and all of such other documents as shall have been reasonably required
by the Certificate Registrar as a condition to such registration. In addition,
no Transfer of a Residual Certificate shall be made unless the Certificate
Registrar shall have received a representation letter from the Transferee of
such Certificate to the effect that such Transferee is a Permitted Transferee.
(iii)(A) If any purported Transferee shall become a Holder of a
Residual Certificate in violation of the provisions of this Section 5.02(d),
then the last preceding Permitted Transferee shall be restored, to the extent
permitted by law, to all rights as holder thereof retroactive to the date of
registration of such Transfer of such Residual Certificate. The Certificate
Registrar shall be under no liability to any Person for any registration of
Transfer of a Residual Certificate that is in fact not permitted by this Section
5.02(d) or for making any payments due on such Certificate to the holder thereof
or for taking any other action with respect to such holder under the provisions
of this Agreement.
(B) If any purported Transferee shall become a holder of a Residual
Certificate in violation of the restrictions in this Section 5.02(d) and
to the extent that the retroactive restoration of the rights of the holder
of such Residual Certificate as described in clause (iii)(A) above shall
be invalid, illegal or unenforceable, then the Certificate Registrar shall
have the right, without notice to the holder or any prior holder of such
Residual Certificate, to sell such Residual Certificate to a purchaser
selected by the Certificate Registrar on such terms as the Certificate
Registrar may choose. Such purported Transferee shall promptly endorse and
deliver each Residual Certificate in accordance with the instructions of
the Certificate Registrar. Such purchaser may be the Certificate Registrar
itself or any Affiliate of the Certificate Registrar. The proceeds of such
sale, net of the commissions (which may include commissions payable to the
Certificate Registrar or its Affiliates), expenses and taxes due, if any,
shall be remitted by the Certificate Registrar to such purported
Transferee. The terms and conditions of any sale under this clause
(iii)(B) shall be determined in the sole discretion of the Certificate
Registrar, and the Certificate Registrar shall not be liable to any Person
having an Ownership Interest in a Residual Certificate as a result of its
exercise of such discretion.
(iv) The Trustee shall make available to the Internal Revenue
Service and those Persons specified by the REMIC Provisions all information
necessary to compute any tax imposed (A) as a result of the Transfer of an
Ownership Interest in a Residual Certificate to any Person who is a Disqualified
Organization, including the information described in Treasury regulations
sections 1.860D-1(b)(5) and 1.860E-2(a)(5) with respect to the "excess
inclusions" of such Residual Certificate and (B) as a result of any regulated
investment company, real estate investment trust, common trust fund,
partnership, trust, estate or organization described in Section 1381 of the Code
that holds an Ownership Interest in a Residual Certificate having as among its
record holders at any time any Person which is a Disqualified Organization.
Reasonable compensation for providing such information may be accepted by the
Trustee.
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(v) The provisions of this Section 5.02(d) set forth prior to this
subsection (v) may be modified, added to or eliminated, provided that there
shall have been delivered to the Trustee at the expense of the party seeking to
modify, add to or eliminate any such provision the following:
(A) written notification from each Rating Agency to the effect that
the modification, addition to or elimination of such provisions shall not
cause such Rating Agency to downgrade its then-current ratings of any
Class of Certificates; and
(B) an Opinion of Counsel, in form and substance satisfactory to the
Trustee, to the effect that such modification of, addition to or
elimination of such provisions shall not cause any Trust REMIC to cease to
qualify as a REMIC and shall not cause any Trust REMIC, as the case may
be, to be subject to an entity-level tax caused by the Transfer of any
Residual Certificate to a Person that is not a Permitted Transferee or (y)
a Person other than the prospective transferee to be subject to a
REMIC-tax caused by the Transfer of a Residual Certificate to a Person
that is not a Permitted Transferee.
The Trustee shall forward to the NIMS Insurer a copy of the items
delivered to it pursuant to (A) and (B) above.
(e) Subject to the preceding subsections, upon surrender for
registration of transfer of any Certificate at any office or agency of the
Trustee maintained for such purpose pursuant to Section 8.12, the Trustee shall
execute and the Certificate Registrar shall authenticate and deliver, in the
name of the designated Transferee or Transferees, one or more new Certificates
of the same Class of a like aggregate Percentage Interest.
(f) At the option of the Holder thereof, any Certificate may be
exchanged for other Certificates of the same Class with authorized denominations
and a like aggregate Percentage Interest, upon surrender of such Certificate to
be exchanged at any office or agency of the Trustee maintained for such purpose
pursuant to Section 8.12. Whenever any Certificates are so surrendered for
exchange the Trustee, shall execute and cause the Certificate Registrar to
authenticate and deliver the Certificates which the Certificateholder making the
exchange is entitled to receive. Every Certificate presented or surrendered for
transfer or exchange shall (if so required by the Trustee) be duly endorsed by,
or be accompanied by a written instrument of transfer in the form satisfactory
to the Trustee and the Certificate Registrar duly executed by, the Holder
thereof or his attorney duly authorized in writing. In addition, (i) with
respect to each Class R Certificate, the Holder thereof may exchange, in the
manner described above, the Class R Certificate for two separate Certificates,
each representing such Holder's respective Percentage Interest in the Class R-I
Interest and the Class R-II Interest, respectively, in each case that was
evidenced by the Class R Certificate being exchanged and (ii) with respect to
each Class R-X Certificate, the holder thereof may exchange, in the manner
described above, such Class R-X Certificate for two separate certificates, each
representing such holder's respective Percentage Interest in the Class R-III
Interest and the Class R-IV Interest, respectively, in each case that was
evidenced by the Class R-X Certificate being exchanged..
(g) No service charge to the Certificateholders shall be made for
any transfer or exchange of Certificates, but the Trustee may require payment of
a sum sufficient to cover any tax
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or governmental charge that may be imposed in connection with any transfer or
exchange of Certificates.
(h) All Certificates surrendered for transfer and exchange shall be
canceled and destroyed by the Certificate Registrar in accordance with its
customary procedures.
(i) The Trustee shall cause the Certificate Registrar (unless the
Trustee is acting as Certificate Registrar) to provide notice to the Trustee of
each transfer of a Certificate and to provide the Trustee with an updated copy
of the Certificate Register on the first Business Day in March and August of
each year, commencing in August 2004.
(j) Any attempted or purported transfer of any Certificate in
violation of the provisions of Section 5.02(c) hereof shall be void ab initio
and such Certificate shall be considered to have been held continuously by the
prior permitted Holder.
SECTION 5.03. Mutilated, Destroyed, Lost or Stolen Certificates.
If (i) any mutilated Certificate is surrendered to the Trustee or
the Certificate Registrar, or the Trustee and the Certificate Registrar receive
evidence to their satisfaction of the destruction, loss or theft of any
Certificate, and (ii) there is delivered to the Trustee, the NIMS Insurer and
the Certificate Registrar such security or indemnity as may be required by them
to save each of them harmless, then, in the absence of actual knowledge by the
Trustee or the Certificate Registrar that such Certificate has been acquired by
a bona fide purchaser or the Trustee shall execute and deliver, in exchange for
or in lieu of any such mutilated, destroyed, lost or stolen Certificate, a new
Certificate of the same Class and of like denomination and Percentage Interest.
Upon the issuance of any new Certificate under this Section, the Trustee may
require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses (including
the fees and expenses of the Certificate Registrar) connected therewith. Any
replacement Certificate issued pursuant to this Section shall constitute
complete and indefeasible evidence of ownership in the applicable REMIC created
hereunder, as if originally issued, whether or not the lost, stolen or destroyed
Certificate shall be found at any time.
SECTION 5.04. Persons Deemed Owners.
The Depositor, the Master Servicer, the Trustee, the NIMS Insurer,
the Certificate Registrar and any agent of any of them may treat the Person in
whose name any Certificate is registered as the owner of such Certificate for
the purpose of receiving distributions pursuant to Section 4.01 and for all
other purposes whatsoever, and none of the Depositor, the Master Servicer, the
Trustee, the Certificate Registrar, the NIMS Insurer or any agent of any of them
shall be affected by notice to the contrary.
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SECTION 5.05. Certain Available Information.
On or prior to the date of the first sale of any Class M-7
Certificates, Class M-8 Certificates, Class M-9 Certificates, Class M-10
Certificates, Class CE Certificate, Class P Certificate or Residual Certificate
to an Independent third party, the Depositor shall provide to the Trustee ten
copies of any private placement memorandum or other disclosure document used by
the Depositor in connection with the offer and sale of the Class M-7
Certificates, Class M-8 Certificates, Class M-9 Certificates, Class M-10
Certificates, Class CE Certificates, the Class P Certificates or the Residual
Certificates. In addition, if any such private placement memorandum or
disclosure document is revised, amended or supplemented at any time following
the delivery thereof to the Trustee, the Depositor promptly shall inform the
Trustee of such event and shall deliver to the Trustee ten copies of the private
placement memorandum or disclosure document, as revised, amended or
supplemented. The Trustee shall maintain at its Corporate Trust Office and shall
make available free of charge during normal business hours for review by any
Holder of a Certificate, Certificate Owner or any Person identified to the
Trustee as a prospective transferee of a Certificate, originals or copies of the
following items: (i) in the case of a Holder or prospective transferee of a
Class M-7 Certificates, Class M-8 Certificates, Class M-9 Certificates, Class
M-10 Certificates, a Class CE Certificate, a Class P Certificate or a Residual
Certificate, the private placement memorandum or other disclosure document
relating to such Certificates, if any, in the form most recently provided to the
Trustee; and (ii) in all cases, (A) this Agreement and any amendments hereof
entered into pursuant to Section 11.01, (B) all monthly statements required to
be delivered to Certificateholders of the relevant Class pursuant to Section
4.02 since the Closing Date, and all other notices, reports, statements and
written communications delivered to the Certificateholders of the relevant Class
pursuant to this Agreement since the Closing Date, (C) all certifications
delivered by a Responsible Officer of the Trustee since the Closing Date
pursuant to Section 10.01(h), (D) any and all Officers' Certificates delivered
to the Trustee by the Master Servicer since the Closing Date to evidence the
Master Servicer's determination that any Advance or Servicing Advance was, or if
made, would be a Nonrecoverable Advance or Nonrecoverable Servicing Advance,
respectively, and (E) any and all Officers' Certificates delivered to the
Trustee by the Master Servicer since the Closing Date pursuant to Section
4.04(a). Copies and mailing of any and all of the foregoing items shall be
available from the Trustee upon request at the expense of the person requesting
the same.
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ARTICLE VI
THE DEPOSITOR AND THE MASTER SERVICER
SECTION 6.01. Liability of the Depositor and the Master Servicer.
The Depositor and the Master Servicer each shall be liable in
accordance herewith only to the extent of the obligations specifically imposed
by this Agreement and undertaken hereunder by the Depositor and the Master
Servicer herein.
SECTION 6.02. Merger or Consolidation of the Depositor or the Master
Servicer.
Subject to the following paragraph, the Depositor shall keep in full
effect its existence, rights and franchises as a corporation under the laws of
the jurisdiction of its incorporation. Subject to the following paragraph, the
Master Servicer shall keep in full effect its existence, rights and franchises
as a corporation under the laws of the jurisdiction of its incorporation and its
qualification as an approved conventional seller/servicer for Xxxxxx Xxx or
Xxxxxxx Mac in good standing. The Depositor and the Master Servicer each shall
obtain and preserve its qualification to do business as a foreign corporation in
each jurisdiction in which such qualification is or shall be necessary to
protect the validity and enforceability of this Agreement, the Certificates or
any of the Mortgage Loans and to perform its respective duties under this
Agreement.
The Depositor or the Master Servicer may be merged or consolidated
with or into any Person, or transfer all or substantially all of its assets to
any Person, in which case any Person resulting from any merger or consolidation
to which the Depositor or the Master Servicer shall be a party, or any Person
succeeding to the business of the Depositor or the Master Servicer, shall be the
successor of the Depositor or the Master Servicer, as the case may be,
hereunder, without the execution or filing of any paper or any further act on
the part of any of the parties hereto, anything herein to the contrary
notwithstanding; provided, however, that the successor or surviving Person to
the Master Servicer shall be qualified to service mortgage loans on behalf of
Xxxxxx Mae or Xxxxxxx Mac; and provided further that the Rating Agencies'
ratings of the Class A Certificates and the Mezzanine Certificates in effect
immediately prior to such merger or consolidation shall not be qualified,
reduced or withdrawn as a result thereof (as evidenced by a letter to such
effect from the Rating Agencies).
SECTION 6.03. Limitation on Liability of the Depositor, the Master
Servicer and Others.
None of the Depositor, the NIMS Insurer, the Master Servicer or any
of the directors, officers, employees or agents of the Depositor or the Master
Servicer shall be under any liability to the Trust Fund or the
Certificateholders for any action taken or for refraining from the taking of any
action in good faith pursuant to this Agreement, or for errors in judgment;
provided, however, that this provision shall not protect the Depositor, the NIMS
Insurer, the Master Servicer or any such person against any breach of
warranties, representations or covenants made herein, or against any specific
liability imposed on the Master Servicer pursuant hereto, or against any
liability which
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would otherwise be imposed by reason of willful misfeasance, bad faith or
negligence in the performance of duties or by reason of reckless disregard of
obligations and duties hereunder. The Depositor, the NIMS Insurer, the Master
Servicer or the Trustee and any director, officer, employee or agent of the
Depositor, the NIMS Insurer, the Master Servicer or the Trustee may rely in good
faith on any document of any kind which, prima facie, is properly executed and
submitted by any Person respecting any matters arising hereunder.
The Depositor, the NIMS Insurer, the Master Servicer and any
director, officer, employee or agent of the Depositor, the NIMS Insurer or the
Master Servicer shall be indemnified and held harmless by the Trust Fund against
any loss, liability or expense incurred in connection with any legal action
relating to this Agreement or the Certificates, other than any loss, liability
or expense relating to any specific Mortgage Loan or Mortgage Loans (except as
any such loss, liability or expense shall be otherwise reimbursable pursuant to
this Agreement) or any loss, liability or expense incurred by reason of willful
misfeasance, bad faith or negligence in the performance of duties hereunder or
by reason of reckless disregard of obligations and duties hereunder. Neither the
Depositor, the NIMS Insurer nor the Master Servicer shall be under any
obligation to appear in, prosecute or defend any legal action unless such action
is related to its respective duties under this Agreement and, in its opinion,
does not involve it in any expense or liability; provided, however, that each of
the Depositor, the NIMS Insurer and the Master Servicer may in its discretion
undertake any such action which it may deem necessary or desirable with respect
to this Agreement and the rights and duties of the parties hereto and the
interests of the Certificateholders hereunder. In such event, unless the
Depositor or the Master Servicer acts without the consent of the Holders of
Certificates entitled to at least 51% of the Voting Rights (which consent shall
not be necessary in the case of litigation or other legal action by either to
enforce their respective rights or defend themselves hereunder), the legal
expenses and costs of such action and any liability resulting therefrom (except
any loss, liability or expense incurred by reason of willful misfeasance, bad
faith or negligence in the performance of duties hereunder or by reason of
reckless disregard of obligations and duties hereunder) shall be expenses, costs
and liabilities of the Trust Fund, and the Depositor, the NIMS Insurer and the
Master Servicer shall be entitled to be reimbursed therefor from the Collection
Account as and to the extent provided in Section 3.05, any such right of
reimbursement being prior to the rights of the Certificateholders to receive any
amount in the Collection Account.
SECTION 6.04. Limitation on Resignation of the Master Servicer.
The Master Servicer shall not resign from the obligations and duties
hereby imposed on it except (i) upon determination that its duties hereunder are
no longer permissible under applicable law or (ii) with the written consent of
the Trustee, the NIMS Insurer and written confirmation from each Rating Agency
(which confirmation shall be furnished to the Depositor, the NIMS Insurer and
the Trustee) that such resignation shall not cause such Rating Agency to reduce
the then current rating of the Class A Certificates or the Mezzanine
Certificates. Any such determination pursuant to clause (i) of the preceding
sentence permitting the resignation of the Master Servicer shall be evidenced by
an Opinion of Counsel to such effect obtained at the expense of the Master
Servicer and delivered to the Trustee and the NIMS Insurer. No resignation of
the Master Servicer shall become effective until the Trustee or a successor
servicer acceptable to the NIMS Insurer shall have assumed the Master Servicer's
responsibilities, duties, liabilities (other than
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those liabilities arising prior to the appointment of such successor) and
obligations under this Agreement.
Except as expressly provided herein, the Master Servicer shall not
assign or transfer any of its rights, benefits or privileges hereunder to any
other Person, nor delegate to or subcontract with, nor authorize or appoint any
other Person to perform any of the duties, covenants or obligations to be
performed by the Master Servicer hereunder. If, pursuant to any provision
hereof, the duties of the Master Servicer are transferred to a successor master
servicer, the entire amount of the Servicing Fee and other compensation payable
to the Master Servicer pursuant hereto shall thereafter be payable to such
successor master servicer.
Notwithstanding anything to the contrary set forth above in this
Section 6.04, in the event that the Special Sub-Servicer is designated as the
successor Master Servicer pursuant to Section 7.02(a), the Trustee and the
Depositor hereby specifically (i) consent to the pledge and assignment by the
Special Sub-Servicer (in its capacity as successor Master Servicer) of all of
the Special Sub-Servicer's (in its capacity as successor Master Servicer) right,
title and interest in, to and under this Agreement to the Servicing Rights
Pledgee, for the benefit of certain lenders and (ii) provided that no Master
Servicer Event of Default exists (with respect to the Special Sub-Servicer, in
its capacity as successor Master Servicer), agree that upon delivery to the
Trustee by the Servicing Rights Pledgee of (x) a letter signed by the Special
Sub-Servicer (in its capacity as successor Master Servicer) whereunder the
Special Sub-Servicer (in its capacity as successor Master Servicer) shall resign
as successor Master Servicer under this Agreement and (y) a letter signed by the
Servicing Rights Pledgee or its designee, whereunder such party acknowledges
such assignment and agrees to be subject to the terms of this Agreement, the
Trustee shall appoint the Servicing Rights Pledgee or its designee as successor
Master Servicer pursuant to Section 7.02, provided that at the time of such
appointment, the Servicing Rights Pledgee or such designee meets the
requirements of a successor Master Servicer pursuant to Section 7.02(a) hereof;
provided, that the consent and approval of the NIMs Insurer shall be deemed to
have been given to the Servicing Rights Pledgee or its designee, and the
Servicing Rights Pledgee and its designee are hereby agreed to be acceptable to
the NIMs Insurer. If, pursuant to any provision hereof, the duties of the
Special Sub-Servicer (in its capacity as successor Master Servicer) are
transferred to a successor master servicer, the entire amount of the Servicing
Fee and other compensation payable to the Special Sub-Servicer (in its capacity
as successor Master Servicer) pursuant hereto shall thereafter be payable to
such successor master servicer.
SECTION 6.05. Rights of the Depositor in Respect of the Master
Servicer.
The Master Servicer shall afford (and any Sub-Servicing Agreement
shall provide that each Sub-Servicer shall afford) the Depositor, the NIMS
Insurer and the Trustee, upon reasonable notice, during normal business hours,
access to all records maintained by the Master Servicer (and any such
Sub-Servicer) in respect of the Master Servicer's rights and obligations
hereunder and access to officers of the Master Servicer (and those of any such
Sub-Servicer) responsible for such obligations. Upon request, the Master
Servicer shall furnish to the Depositor, the NIMS Insurer and the Trustee its
(and any such Sub-Servicer's) most recent financial statements and such other
information relating to the Master Servicer's capacity to perform its
obligations under this Agreement that it possesses. To the extent such
information is not otherwise available to the public,
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the Depositor, the NIMS Insurer and the Trustee shall not disseminate any
information obtained pursuant to the preceding two sentences without the Master
Servicer's (or any such Sub-Servicer's) written consent, except as required
pursuant to this Agreement or to the extent that it is appropriate to do so (i)
in working with legal counsel, auditors, taxing authorities or other
governmental agencies, rating agencies or reinsurers or (ii) pursuant to any
law, rule, regulation, order, judgment, writ, injunction or decree of any court
or governmental authority having jurisdiction over the Depositor, the Trustee or
the Trust Fund, and in either case, the Depositor, the NIMS Insurer or the
Trustee, as the case may be, shall use its best efforts to assure the
confidentiality of any such disseminated non-public information. The Depositor
may, but is not obligated to, enforce the obligations of the Master Servicer
under this Agreement and may, but is not obligated to, perform, or cause a
designee to perform, any defaulted obligation of the Master Servicer under this
Agreement or exercise the rights of the Master Servicer under this Agreement;
provided that the Master Servicer shall not be relieved of any of its
obligations under this Agreement by virtue of such performance by the Depositor
or its designee. The Depositor shall not have any responsibility or liability
for any action or failure to act by the Master Servicer and is not obligated to
supervise the performance of the Master Servicer under this Agreement or
otherwise.
SECTION 6.06. Sub-Servicing Agreements Between the Master Servicer
and Sub-Servicers.
(a) The Master Servicer may enter into Sub-Servicing Agreements
(provided that such agreements would not result in a withdrawal or a downgrading
by any Rating Agency of the ratings on any Class of Certificates and the NIMS
Insurer shall have consented to such Sub-Servicing Agreement) with
Sub-Servicers, for the servicing and administration of the Mortgage Loans.
Each Sub-Servicer shall be (i) authorized to transact business in
the state or states in which the related Mortgaged Properties it is to service
are situated, if and to the extent required by applicable law to enable the
Sub-Servicer to perform its obligations hereunder and under the Sub- Servicing
Agreement, (ii) an institution approved as a mortgage loan originator by the
Federal Housing Administration or an institution the deposit accounts in which
are insured by the FDIC and (iii) a Xxxxxxx Mac or Xxxxxx Mae approved mortgage
servicer. Each Sub-Servicing Agreement must impose on the Sub-Servicer
requirements conforming to the provisions set forth in Section 6.11 and provide
for servicing of the Mortgage Loans consistent with the terms of this Agreement.
The Master Servicer shall examine each Sub-Servicing Agreement and shall be
familiar with the terms thereof. The terms of any Sub-Servicing Agreement shall
not be inconsistent with any of the provisions of this Agreement. The Master
Servicer and the Sub-Servicers may enter into and make amendments to the
Sub-Servicing Agreements or enter into different forms of Sub-Servicing
Agreements; provided, however, that any such amendments or different forms shall
be consistent with and not violate the provisions of this Agreement, and that no
such amendment or different form shall be made or entered into which could be
reasonably expected to be materially adverse to the interests of the
Certificateholders, without the consent of the Holders of Certificates entitled
to at least 66% of the Voting Rights. Any variation without the consent of the
Holders of Certificates entitled to at least 66% of the Voting Rights from the
provisions set forth in Section 6.11 relating to insurance or priority
requirements of Sub-Servicing Accounts, or credits and charges to the Sub-
Servicing Accounts or the timing and amount of remittances by the Sub-Servicers
to the Master Servicer, are conclusively deemed to be inconsistent with this
Agreement and therefore prohibited.
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The Master Servicer shall deliver to the Trustee and the NIMS Insurer copies of
all Sub-Servicing Agreements, and any amendments or modifications thereof,
promptly upon the Master Servicer's execution and delivery of such instruments.
(b) As part of its servicing activities hereunder, the Master
Servicer (except as otherwise provided in the last sentence of this paragraph),
for the benefit of the Trustee and the Certificateholders, shall enforce the
obligations of each Sub-Servicer under the related Sub-Servicing Agreement and
of the Seller under the Mortgage Loan Purchase Agreement, including, without
limitation, any obligation to make advances in respect of delinquent payments as
required by a Sub- Servicing Agreement, or to purchase a Mortgage Loan on
account of missing or defective documentation or on account of a breach of a
representation, warranty or covenant, as described in Section 2.03(a). Such
enforcement, including, without limitation, the legal prosecution of claims,
termination of Sub-Servicing Agreements, and the pursuit of other appropriate
remedies, shall be in such form and carried out to such an extent and at such
time as the Master Servicer, in its good faith business judgment, would require
were it the owner of the related Mortgage Loans. The Master Servicer shall pay
the costs of such enforcement at its own expense, and shall be reimbursed
therefor only (i) from a general recovery resulting from such enforcement, to
the extent, if any, that such recovery exceeds all amounts due in respect of the
related Mortgage Loans or (ii) from a specific recovery of costs, expenses or
attorneys' fees against the party against whom such enforcement is directed.
Enforcement of the Mortgage Loan Purchase Agreement against the Seller shall be
effected by the Master Servicer to the extent it is not the Seller, and
otherwise by the Trustee, in accordance with the foregoing provisions of this
paragraph.
(c) The parties hereto acknowledge that the Special Sub-Servicer has
been retained by the Master Servicer to service the Specially Serviced Mortgage
Loans pursuant to the Special Sub-Servicing Agreement, which shall constitute a
Sub-Servicing Agreement hereunder. As compensation for its services, the Special
Sub-Servicer will be paid the Servicing Fee with respect to each Mortgage Loan
that becomes 90 days or more delinquent. Notwithstanding anything in this
Section 6.06 or Section 6.07 to the contrary, the conditions governing the
termination of the Special Sub-Servicer shall be set forth in the Special
Sub-Servicing Agreement. In the event that Xxxxxx Loan Servicing LP is no longer
the Special Sub-Servicer, Ameriquest Mortgage Company may serve in such
capacity.
SECTION 6.07. Successor Sub-Servicers.
The Master Servicer, with the consent of the NIMS Insurer, shall be
entitled to terminate any Sub-Servicing Agreement and the rights and obligations
of any Sub-Servicer pursuant to any Sub-Servicing Agreement in accordance with
the terms and conditions of such Sub-Servicing Agreement. In the event of
termination of any Sub-Servicer, all servicing obligations of such Sub- Servicer
shall be assumed simultaneously by the Master Servicer without any act or deed
on the part of such Sub-Servicer or the Master Servicer, and the Master Servicer
either shall service directly the related Mortgage Loans or shall enter into a
Sub-Servicing Agreement with a successor Sub-Servicer which qualifies under
Section 6.06.
Any Sub-Servicing Agreement shall include the provision that such
agreement may be immediately terminated by the Trustee without fee, in
accordance with the terms of this
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Agreement, in the event that the Master Servicer shall, for any reason, no
longer be the Master Servicer (including termination due to a Master Servicer
Event of Default).
SECTION 6.08. Liability of the Master Servicer.
Notwithstanding any Sub-Servicing Agreement, any of the provisions
of this Agreement relating to agreements or arrangements between the Master
Servicer and a Sub-Servicer or reference to actions taken through a Sub-Servicer
or otherwise, the Master Servicer shall remain obligated and primarily liable to
the Trustee and the Certificateholders for the servicing and administering of
the Mortgage Loans in accordance with the provisions of Section 3.01 without
diminution of such obligation or liability by virtue of such Sub-Servicing
Agreements or arrangements or by virtue of indemnification from the Sub-Servicer
and to the same extent and under the same terms and conditions as if the Master
Servicer alone were servicing and administering the Mortgage Loans.
Notwithstanding the foregoing, with respect to the Special Sub-Servicing
Agreement, the Master Servicer shall confirm that the Special Sub-Servicer shall
be primarily obligated and liable to the Trustee and the Certificateholders for
the servicing and administering of the Specially Serviced Mortgage Loans and the
Master Servicer shall have no responsibility or liability therefor. The Master
Servicer shall be entitled to enter into any agreement with a Sub- Servicer for
indemnification of the Master Servicer by such Sub-Servicer and nothing
contained in this Agreement shall be deemed to limit or modify such
indemnification.
SECTION 6.09. No Contractual Relationship Between Sub-Servicers and
the NIMS Insurer, the Trustee or Certificateholders.
Any Sub-Servicing Agreement that may be entered into and any
transactions or services relating to the Mortgage Loans involving a Sub-Servicer
in its capacity as such shall be deemed to be between the Sub-Servicer and the
Master Servicer alone, and the NIMS Insurer, the Trustee and Certificateholders
shall not be deemed parties thereto and shall have no claims, rights,
obligations, duties or liabilities with respect to the Sub-Servicer except as
set forth in Section 6.10. The Master Servicer shall be solely liable for all
fees owed by it to any Sub-Servicer, irrespective of whether the Master
Servicer's compensation pursuant to this Agreement is sufficient to pay such
fees.
SECTION 6.10. Assumption or Termination of Sub-Servicing Agreements
by Trustee.
In the event the Master Servicer shall for any reason no longer be
the master servicer (including termination due to a Master Servicer Event of
Default), the Trustee or its designee shall thereupon assume (or cause its
designee or the successor master servicer for the Trustee appointed pursuant to
Section 7.02 to assume) all of the rights and obligations of the Master Servicer
under each Sub-Servicing Agreement that the Master Servicer may have entered
into, unless the Trustee elects to terminate any Sub-Servicing Agreement in
accordance with its terms as provided in Section 6.07. Upon such assumption, the
Trustee, its designee or the successor servicer for the Trustee appointed
pursuant to Section 7.02 shall be deemed, subject to Section 6.07, to have
assumed all of the Master Servicer's interest therein and to have replaced the
Master Servicer as a party to each Sub-Servicing Agreement to the same extent as
if each Sub-Servicing Agreement had been assigned
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to the assuming party, except that (i) the Master Servicer shall not thereby be
relieved of any liability or obligations under any Sub-Servicing Agreement and
(ii) none of the Trustee, its designee or any successor Master Servicer shall be
deemed to have assumed any liability or obligation of the Master Servicer that
arose before it ceased to be the Master Servicer.
The Master Servicer at its expense shall, upon request of the
Trustee, deliver to the assuming party all documents and records relating to
each Sub-Servicing Agreement and the Mortgage Loans then being serviced and an
accounting of amounts collected and held by or on behalf of it, and otherwise
use its best efforts to effect the orderly and efficient transfer of the Sub-
Servicing Agreements to the assuming party.
SECTION 6.11. Sub-Servicing Accounts.
In those cases where a Sub-Servicer is servicing a Mortgage Loan
pursuant to a Sub- Servicing Agreement, the Sub-Servicer shall be required to
establish and maintain one or more accounts (collectively, the "Sub-Servicing
Account"). The Sub-Servicing Account shall be an Eligible Account. The
Sub-Servicer shall deposit in the clearing account (which account must be an
Eligible Account) in which it customarily deposits payments and collections on
mortgage loans in connection with its mortgage loan servicing activities on a
daily basis, and in no event more than one Business Day after the Sub-Servicer's
receipt thereof, all proceeds of Mortgage Loans received by the Sub-Servicer
less its servicing compensation to the extent permitted by the Sub-Servicing
Agreement, and shall thereafter deposit such amounts in the Sub-Servicing
Account, in no event more than two Business Days after the deposit of such funds
into the clearing account. The Sub- Servicer shall thereafter deposit such
proceeds in the Collection Account or remit such proceeds to the Master Servicer
for deposit in the Collection Account not later than two Business Days after the
deposit of such amounts in the Sub-Servicing Account. For purposes of this
Agreement, the Master Servicer shall be deemed to have received payments on the
Mortgage Loans when the Sub-Servicer receives such payments.
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ARTICLE VII
DEFAULT
SECTION 7.01. Master Servicer Events of Default.
"Master Servicer Event of Default," wherever used herein, means any
one of the following events:
(i) any failure by the Master Servicer to remit to the Trustee for
distribution to the Certificateholders any payment (other than an Advance
required to be made from its own funds on any Master Servicer Remittance
Date pursuant to Section 4.03) required to be made under the terms of the
Certificates and this Agreement which continues unremedied for a period of
one Business Day after the date upon which written notice of such failure,
requiring the same to be remedied, shall have been given to the Master
Servicer by the Depositor or the Trustee (in which case notice shall be
provided by telecopy), or to the Master Servicer, the Depositor and the
Trustee by the NIMS Insurer or the Holders of Certificates entitled to at
least 25% of the Voting Rights; or
(ii) any failure on the part of the Master Servicer duly to observe
or perform in any material respect any of the covenants or agreements on
the part of the Master Servicer contained in the Certificates or in this
Agreement (or, if the Master Servicer is the Seller, the failure of the
Seller to repurchase a Mortgage Loan as to which a breach has been
established that requires a repurchase pursuant to the terms of Section 7
of the Mortgage Loan Purchase Agreement) which continues unremedied for a
period of 45 days after the earlier of (i) the date on which written
notice of such failure, requiring the same to be remedied, shall have been
given to the Master Servicer by the Depositor or the Trustee, or to the
Master Servicer, the Depositor and the Trustee by the NIMS Insurer or the
Holders of Certificates entitled to at least 25% of the Voting Rights and
(ii) actual knowledge of such failure by a Servicing Officer of the Master
Servicer; or
(iii) a decree or order of a court or agency or supervisory
authority having jurisdiction in the premises in an involuntary case under
any present or future federal or state bankruptcy, insolvency or similar
law or the appointment of a conservator or receiver or liquidator in any
insolvency, readjustment of debt, marshaling of assets and liabilities or
similar proceeding, or for the winding-up or liquidation of its affairs,
shall have been entered against the Master Servicer and if such proceeding
is being contested by the Master Servicer in good faith, such decree or
order shall have remained in force undischarged or unstayed for a period
of 60 days or results in the entry of an order for relief or any such
adjudication or appointment; or
(iv) the Master Servicer shall consent to the appointment of a
conservator or receiver or liquidator in any insolvency, readjustment of
debt, marshaling of assets and liabilities or similar proceedings of or
relating to the Master Servicer or of or relating to all or substantially
all of its property; or
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(v) the Master Servicer shall admit in writing its inability to pay
its debts generally as they become due, file a petition to take advantage
of any applicable insolvency or reorganization statute, make an assignment
for the benefit of its creditors, or voluntarily suspend payment of its
obligations; or
(vi) any failure by the Master Servicer of the Master Servicer
Termination Test; or
(vii) any failure of the Master Servicer to make any Advance on any
Master Servicer Remittance Date required to be made from its own funds
pursuant to Section 4.03 which continues unremedied until 3:00 p.m. New
York time on the Business Day immediately following the Master Servicer
Remittance Date.
If a Master Servicer Event of Default described in clauses (i)
through (vi) of this Section shall occur, then, and in each and every such case,
so long as such Master Servicer Event of Default shall not have been remedied,
the Depositor, the NIMS Insurer or the Trustee may, and at the written direction
of the Holders of Certificates entitled to at least 51% of Voting Rights, or at
the direction of the NIMS Insurer, the Trustee shall, by notice in writing to
the Master Servicer, the Special Sub-Servicer the Servicing Rights Pledgee (if
any) and the Depositor, terminate all of the rights and obligations of the
Master Servicer in its capacity as Master Servicer under this Agreement, to the
extent permitted by law, and in and to the Mortgage Loans and the proceeds
thereof. If a Master Servicer Event of Default described in clause (vii) hereof
shall occur, the Trustee shall, by notice in writing to the Master Servicer, the
Depositor and the Servicing Rights Pledgee (if any), terminate all of the rights
and obligations of the Master Servicer in its capacity as Master Servicer under
this Agreement and in and to the Mortgage Loans and the proceeds thereof and the
Trustee as successor or another successor Master Servicer appointed in
accordance with Section 7.02, shall immediately make such Advance (which Advance
shall be part of Available Funds for such Distribution Date) and assume,
pursuant to Section 7.02, the duties of a successor Master Servicer. On or after
the receipt by the Master Servicer of such written notice, all authority and
power of the Master Servicer under this Agreement, whether with respect to the
Certificates (other than as a Holder of any Certificate) or the Mortgage Loans
or otherwise, shall pass to and be vested in the Trustee pursuant to and under
this Section and, without limitation, the Trustee is hereby authorized and
empowered, as attorney-in-fact or otherwise, to execute and deliver on behalf of
and at the expense of the Master Servicer, any and all documents and other
instruments and to do or accomplish all other acts or things necessary or
appropriate to effect the purposes of such notice of termination, whether to
complete the transfer and endorsement or assignment of the Mortgage Loans and
related documents, or otherwise. The Master Servicer agrees, at its sole cost
and expense, promptly (and in any event no later than ten Business Days
subsequent to such notice) to provide the Trustee with all documents and records
requested by it to enable it to assume the Master Servicer's functions under
this Agreement, and to cooperate with the Trustee in effecting the termination
of the Master Servicer's responsibilities and rights under this Agreement,
including, without limitation, the transfer within one Business Day to the
Trustee for administration by it of all cash amounts which at the time shall be
or should have been credited by the Master Servicer to the Collection Account
held by or on behalf of the Master Servicer, the Distribution Account or any REO
Account or Servicing Account held by or on behalf of the Master Servicer or
thereafter be received with respect to the Mortgage Loans or any REO Property
serviced by the Master Servicer (provided, however, that the Master Servicer
shall continue to be entitled to receive all amounts accrued or owing to it
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under this Agreement on or prior to the date of such termination, whether in
respect of Advances or otherwise, and shall continue to be entitled to the
benefits of Section 6.03, notwithstanding any such termination, with respect to
events occurring prior to such termination). For purposes of this Section 7.01,
the Trustee shall not be deemed to have knowledge of a Master Servicer Event of
Default unless a Responsible Officer of the Trustee assigned to and working in
the Trustee's Corporate Trust Office has actual knowledge thereof or unless
written notice is received by the Trustee of any such event and such notice
references the Certificates, REMIC I or this Agreement.
The Trustee shall be entitled to be reimbursed by the Master
Servicer (or by the Trust Fund if the Master Servicer is unable to fulfill its
obligations hereunder) for all costs associated with the transfer of servicing
from the predecessor servicer, including without limitation, any costs or
expenses associated with the complete transfer of all servicing data and the
completion, correction or manipulation of such servicing data as may be required
by the Trustee to correct any errors or insufficiencies in the servicing data or
otherwise to enable the Trustee to service the Mortgage Loans properly and
effectively.
SECTION 7.02. Trustee to Act; Appointment of Successor.
(a) On and after the time the Master Servicer receives a notice of
termination subject to the rights of the Special Sub-Servicer and the Servicing
Rights Pledgee, the Trustee shall be the successor in all respects to the Master
Servicer in its capacity as Master Servicer under this Agreement and the
transactions set forth or provided for herein and shall be subject to all the
responsibilities, duties and liabilities relating thereto and arising thereafter
placed on the Master Servicer (except for any representations or warranties of
the Master Servicer under this Agreement, the responsibilities, duties and
liabilities contained in Section 2.03(c) and its obligation to deposit amounts
in respect of losses pursuant to Section 3.06) by the terms and provisions
hereof including, without limitation, the Master Servicer's obligations to make
Advances pursuant to Section 4.03; provided, however, that if the Trustee is
prohibited by law or regulation from obligating itself to make advances
regarding delinquent mortgage loans, then the Trustee shall not be obligated to
make Advances pursuant to Section 4.03; and provided further, that any failure
to perform such duties or responsibilities caused by the Master Servicer's
failure to provide information required by Section 7.01 shall not be considered
a default by the Trustee as successor to the Master Servicer hereunder;
provided, however, it is understood and acknowledged by the parties that there
shall be a period of transition (not to exceed 90 days) before the servicing
transfer is fully effected. As compensation therefor, effective from and after
the time the Master Servicer receives a notice of termination or immediately
upon assumption of the obligations to make Advances, the Trustee shall be
entitled to the Servicing Fee and all funds relating to the Mortgage Loans to
which the Master Servicer would have been entitled if it had continued to act
hereunder (other than amounts which were due or would become due to the Master
Servicer prior to its termination or resignation). Notwithstanding the above and
subject to the next paragraph, the Trustee may, if it shall be unwilling to so
act, or shall, if it is unable to so act or if it is prohibited by law from
making advances regarding delinquent mortgage loans, or if the Holders of
Certificates entitled to at least 51% of the Voting Rights or the NIMS Insurer
so request in writing to the Trustee promptly appoint or petition a court of
competent jurisdiction to appoint, an established mortgage loan servicing
institution acceptable to each Rating Agency (with confirmation from the Rating
Agencies that such appointment shall not result in the reduction or withdrawal
of the rating of any outstanding Class of Certificates) and acceptable to the
NIMS Insurer (except for a court-appointed successor) and having a net worth of
not less than
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$15,000,000 as the successor to the Master Servicer under this Agreement in the
assumption of all or any part of the responsibilities, duties or liabilities of
the Master Servicer under this Agreement. No appointment of a successor to the
Master Servicer under this Agreement shall be effective until the assumption by
the successor of all of the Master Servicer's responsibilities, duties and
liabilities hereunder. In connection with such appointment and assumption
described herein, 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 the Master Servicer as such hereunder. The Depositor, the Trustee and
such successor shall take such action, consistent with this Agreement, as shall
be necessary to effectuate any such succession. Pending appointment of a
successor to the Master Servicer under this Agreement, the Trustee shall act in
such capacity as hereinabove provided.
Upon removal or resignation of the Master Servicer, the Trustee,
with the cooperation of the Depositor, (x) shall solicit bids for a successor
Master Servicer as described below and (y) pending the appointment of a
successor Master Servicer as a result of soliciting such bids, shall serve as
Master Servicer of the Mortgage Loans serviced by such predecessor Master
Servicer. The Trustee shall solicit, by public announcement, bids from housing
and home finance institutions, banks and mortgage servicing institutions meeting
the qualifications set forth above (including the Trustee or any affiliate
thereof) (including that such mortgage loan servicing institution be acceptable
to each Rating Agency and the NIMS Insurer). Such public announcement shall
specify that the successor Master Servicer shall be entitled to the servicing
compensation agreed upon between the Trustee, the successor Master Servicer and
the Depositor; provided, however, that no such fee shall exceed the Servicing
Fee. Within thirty days after any such public announcement, the Trustee, with
the cooperation of the Depositor, shall negotiate in good faith and effect the
sale, transfer and assignment of the servicing rights and responsibilities
hereunder to the qualified party submitting the highest satisfactory bid as to
the price they shall pay to obtain such servicing. The Trustee upon receipt of
the purchase price shall pay such purchase price to the Master Servicer being so
removed, after deducting from any sum received by the Trustee from the successor
to the Master Servicer in respect of such sale, transfer and assignment all
costs and expenses of any public announcement and of any sale, transfer and
assignment of the servicing rights and responsibilities reasonably incurred
hereunder. After such deductions, the remainder of such sum shall be paid by the
Trustee to the Master Servicer at the time of such sale.
Notwithstanding the foregoing, the parties hereto acknowledge that
in the event of the termination of the Master Servicer pursuant to Section 7.01,
the Special Sub-Servicer shall be appointed at the time of such termination the
successor Master Servicer provided that at the time of the Master Servicer's
termination hereunder (i) the Special Sub-Servicer has at least RPS-2 and RSS-2
rankings by Fitch, (ii) the Special Sub-Servicer has performed its duties and
obligations under the Special Sub-Servicing Agreement as evidenced by a
certificate of the Special Sub-Servicer delivered to the Trustee, (iii) any
Special Sub-Servicer event of termination as set forth in the Special
Sub-Servicing Agreement has not occurred and is not continuing of which a
Responsible Officer of the Trustee has actual knowledge and (iv) the appointment
of the Special Sub-Servicer as successor Master Servicer will not cause any
Rating Agency to withdraw or downgrade its then-current ratings of any Class of
Certificates as evidenced by a written conformation of the Rating Agency.
Notwithstanding anything contained herein, if Xxxxxx Loan Servicing LP becomes
the successor Master Servicer, the Loss Mitigation Action Plan shall not apply.
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If, pursuant to 6.04, the Special Sub-Servicer (in its capacity as
successor Master Servicer) assigns of all of the Special Sub-Servicer's (in its
capacity as successor Master Servicer) right, title and interest in, to and
under this Agreement to the Servicing Rights Pledgee or its designee, the
Trustee hereby agrees that such party shall be appointed successor Master
Servicer upon receipt of (x) a letter signed by the Special Sub-Servicer (in its
capacity as successor Master Servicer) whereunder the Special Sub-Servicer (in
its capacity as successor Master Servicer) shall resign as successor Master
Servicer under this Agreement, (y) a letter signed by the Servicing Rights
Pledgee or its designee, whereunder such party acknowledges such assignment and
agrees to be subject to the terms of this Agreement and (z) confirmation from
the Rating Agencies that such appointment will not cause any Rating Agency to
withdraw or downgrade its then-current ratings of any Class of Certificates.
(b) If the Master Servicer fails to remit to the Trustee for
distribution to the Certificateholders any payment required to be made under the
terms of the Certificates and this Agreement (for purposes of this Section
7.02(b), a "Remittance") because the Master Servicer is the subject of a
proceeding under the federal Bankruptcy Code and the making of such Remittance
is prohibited by Section 362 of the federal Bankruptcy Code, the Trustee shall
upon notice of such prohibition, regardless of whether it has received a notice
of termination under Section 7.01, advance the amount of such Remittance by
depositing such amount in the Distribution Account on the related Distribution
Date. The Trustee shall be obligated to make such advance only if (i) such
advance, in the good faith judgment of the Trustee can reasonably be expected to
be ultimately recoverable from Stayed Funds and (ii) the Trustee is not
prohibited by law from making such advance or obligating itself to do so. Upon
remittance of the Stayed Funds to the Trustee or the deposit thereof in the
Distribution Account by the Master Servicer, a trustee in bankruptcy or a
federal bankruptcy court, the Trustee may recover the amount so advanced,
without interest, by withdrawing such amount from the Distribution Account;
however, nothing in this Agreement shall be deemed to affect the Trustee's
rights to recover from the Master Servicer's own funds interest on the amount of
any such advance. If the Trustee at any time makes an advance under this
Subsection which it later determines in its good faith judgment shall not be
ultimately recoverable from the Stayed Funds with respect to which such advance
was made, the Trustee shall be entitled to reimburse itself for such advance,
without interest, by withdrawing from the Distribution Account, out of amounts
on deposit therein, an amount equal to the portion of such advance attributable
to the Stayed Funds.
(c) If the Master Servicer is terminated pursuant to Section 7.01,
then the successor Master Servicer shall not be permitted to reimburse itself
directly for Advances or Servicing Advances under Section 3.05(a)(ii), Section
3.05(a)(iii), Section 3.05(a)(v) or Section 3.05(a)(vii) if the Master Servicer
has not been fully reimbursed for its Advances and Servicing Advances, but
instead the successor Master Servicer shall include such amounts in the
applicable remittance to the Trustee made pursuant to Section 3.04(g) to the
extent of amounts on deposit in the Collection Account on the related Master
Servicer Remittance Date. The Trustee is hereby authorized to pay to the
terminated Master Servicer (or the related Advancing Person in accordance with
Section 3.23) and the successor Master Servicer, as applicable, reimbursements
for Advances and Servicing Advances from the Distribution Account to the same
extent each such Master Servicer would have been permitted to reimburse itself
for such Advances and/or Servicing Advances in accordance with Section
3.05(a)(ii), Section 3.05(a)(iii), Section 3.05(a)(v) or Section 3.05(a)(vii),
as the case may be. All Advances and Servicing Advances made pursuant to the
terms of this Agreement shall be deemed made and shall be reimbursed on a "first
in-first out" (FIFO) basis. At
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such time as the Master Servicer (or related Advancing Person) has been
reimbursed for all Advances and Servicing Advances made by it, the successor
Master Servicer shall no longer be required to remit in accordance with the
first sentence of this Section 7.02(c) and shall then be permitted to reimburse
itself directly for Advances and Servicing Advances in accordance with Section
3.05(a)(ii), Section 3.05(a)(iii), Section 3.05(a)(v) or Section 3.05(a)(vii).
(d) In the event that the Special Sub-Servicer has been designated
as the successor Master Servicer pursuant to Section 7.02(a) and in the event
that following such designation, a Master Servicer Event of Default has occurred
with respect to the Special Sub-Servicer as successor Master Servicer,
notwithstanding anything to the contrary above, the Trustee and the Depositor
hereby agree that upon delivery to the Trustee by or on behalf of the Servicing
Rights Pledgee of a letter signed by the Special Sub-Servicer within ten
Business Days of the date on which the Trustee sent notice of such default,
whereunder the Special Sub-Servicer (in its capacity as successor Master
Servicer) shall resign as successor Master Servicer under this Agreement, the
Trustee shall appoint the Servicing Rights Pledgee or its designee as successor
Master Servicer, provided that at the time of such appointment, the Servicing
Rights Pledgee or such designee meets the requirements of a successor Master
Servicer set forth above and the Servicing Rights Pledgee or such designee
agrees to be subject to the terms of this Agreement. If the Servicing Rights
Pledgee fails to provide the Trustee with such letter, the Trustee shall appoint
a successor Master Servicer in accordance with Section 7.02. Notwithstanding
anything to the contrary above, the Special Sub-Servicer shall continue to
perform all of the obligations of Master Servicer hereunder until the Trustee
appoints a successor Master Servicer.
SECTION 7.03. Notification to Certificateholders.
(a) Upon any termination of the Master Servicer pursuant to Section
7.01 above or any appointment of a successor to the Master Servicer pursuant to
Section 7.02 above, the Trustee shall give prompt written notice thereof to
Certificateholders and the NIMS Insurer at their respective addresses appearing
in the Certificate Register.
(b) Not later than the later of 60 days after the occurrence of any
event, which constitutes or which, with notice or lapse of time or both, would
constitute a Master Servicer Event of Default or five days after a Responsible
Officer of the Trustee becomes aware of the occurrence of such an event, the
Trustee shall transmit by mail to the NIMS Insurer and to all Holders of
Certificates notice of each such occurrence, unless such default or Master
Servicer Event of Default shall have been cured or waived.
SECTION 7.04. Waiver of Master Servicer Events of Default.
The Holders representing at least 66% of the Voting Rights (with the
consent of the NIMS Insurer) evidenced by all Classes of Certificates affected
by any default or Master Servicer Event of Default hereunder may waive such
default or Master Servicer Event of Default; provided, however, that a default
or Master Servicer Event of Default under clause (i) or (vii) of Section 7.01
may be waived only by all of the Holders of the Regular Certificates (with the
consent of the NIMS Insurer). Upon any such waiver of a default or Master
Servicer Event of Default, such default or Master Servicer Event of Default
shall cease to exist and shall be deemed to have been remedied for every purpose
hereunder. No such waiver shall extend to any subsequent or other default or
Master
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Servicer Event of Default or impair any right consequent thereon except to the
extent expressly so waived.
ARTICLE VIII
CONCERNING THE TRUSTEE
SECTION 8.01. Duties of Trustee.
The Trustee, prior to the occurrence of a Master Servicer Event of
Default and after the curing of all Master Servicer Events of Default which may
have occurred, undertakes to perform such duties and only such duties as are
specifically set forth in this Agreement. During a Master Servicer Event of
Default, 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. Any permissive right of the Trustee enumerated in
this Agreement shall not be construed as a duty.
The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments furnished
to the Trustee which are specifically required to be furnished pursuant to any
provision of this Agreement, shall examine them to determine whether they
conform on their face to the requirements of this Agreement. If any such
instrument is found not to conform on its face to the requirements of this
Agreement in a material manner, the Trustee shall take such action as it deems
appropriate to have the instrument corrected, and if the instrument is not
corrected to its respective satisfaction, such dissatisfied party shall provide
notice thereof to the Certificateholders and the NIMS Insurer.
No provision of this Agreement shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own misconduct; provided, however, that:
(i) Prior to the occurrence of a Master Servicer Event of Default,
and after the curing of all such Master Servicer Events of Default which
may have occurred, the duties and obligations of the Trustee shall be
determined solely by the express provisions of this Agreement, the Trustee
shall not be liable except for the performance of such duties and
obligations as are specifically set forth in this Agreement, no implied
covenants or obligations shall be read into this Agreement against the
Trustee and, in the absence of bad faith on the part of the Trustee, the
Trustee may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon any certificates or
opinions furnished to the Trustee that conform to the requirements of this
Agreement;
(ii) The Trustee shall not be personally liable for an error of
judgment made in good faith by a Responsible Officer or Responsible
Officers of the Trustee unless it shall be proved that the Trustee was
negligent in ascertaining the pertinent facts; and
(iii) The Trustee shall not be personally liable with respect to any
action taken, suffered or omitted to be taken by it in good faith in
accordance with the direction of the NIMS Insurer or the Holders of
Certificates entitled to at least 25% of the Voting Rights
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relating to the time, method and place of conducting any proceeding for
any remedy available to the Trustee or exercising any trust or power
conferred upon it, under this Agreement.
The Trustee shall not be required to expend or risk its own funds or
otherwise incur financial liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers, if there is
reasonable ground for believing that the repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it, and
none of the provisions contained in this Agreement shall in any event require it
to perform, or be responsible for the manner of performance of, any of the
obligations of the Master Servicer under this Agreement, except during such
time, if any, as the Trustee shall be the successor to, and be vested with the
rights, duties, powers and privileges of, the Master Servicer in accordance with
the terms of this Agreement.
SECTION 8.02. Certain Matters Affecting the Trustee.
(a) Except as otherwise provided in Section 8.01:
(i) The Trustee may request and rely upon and shall be protected in
acting or refraining from acting upon any resolution, Officers'
Certificate, certificate of auditors or any other certificate, statement,
instrument, opinion, report, notice, request, consent, order, appraisal,
bond or other paper or document reasonably believed by it to be genuine
and to have been signed or presented by the proper party or parties;
(ii) The Trustee may consult with counsel and any Opinion of Counsel
shall be full and complete authorization and protection in respect of any
action taken or suffered or omitted by it hereunder in good faith and in
accordance with such Opinion of Counsel;
(iii) The Trustee shall not be under any obligation to exercise any
of the trusts or powers vested in it by this Agreement or to institute,
conduct or defend any litigation hereunder or in relation hereto at the
request, order or direction of any of the Certificateholders or the NIMS
Insurer, pursuant to the provisions of this Agreement, unless such
Certificateholders or the NIMS Insurer, as applicable, shall have offered
to the Trustee security or indemnity reasonably satisfactory to it against
the costs, expenses and liabilities which may be incurred therein or
thereby; nothing contained herein shall, however, relieve the Trustee of
the obligation, upon the occurrence of a Master Servicer Event of Default
(which has not been cured or waived), to exercise such of the rights and
powers vested in it by this Agreement, and to use the same degree of care
and skill in their exercise as a prudent person would exercise or use
under the circumstances in the conduct of such person's own affairs;
(iv) The Trustee shall not be personally liable for any action
taken, suffered or omitted by it in good faith and believed by it to be
authorized or within the discretion or rights or powers conferred upon it
by this Agreement;
(v) Prior to the occurrence of a Master Servicer Event of Default
hereunder and after the curing of all Master Servicer Events of Default
which may have occurred, 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,
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approval, bond or other paper or document, unless requested in writing to
do so by the NIMS Insurer or the Holders of Certificates entitled to at
least 25% of the Voting Rights; provided, however, that if the payment
within a reasonable time to the Trustee of the costs, expenses or
liabilities likely to be incurred by it in the making of such
investigation is, in the opinion of the Trustee not reasonably assured to
the Trustee by such Certificateholders, the Trustee may require reasonable
indemnity against such expense, or liability from such Certificateholders
or the NIMS Insurer as a condition to taking any such action;
(vi) The Trustee may execute any of the trusts or powers hereunder
or perform any duties hereunder either directly or by or through agents or
attorneys; and
(vii) The Trustee shall not be personally liable for any loss
resulting from the investment of funds held in the Collection Account, the
Escrow Account or the REO Account made at the direction of the Master
Servicer pursuant to Section 3.06.
(b) All rights of action under this Agreement or under any of the
Certificates, enforceable by the Trustee, may be enforced by it without the
possession of any of the Certificates, or the production thereof at the trial or
other proceeding relating thereto, and any such suit, action or proceeding
instituted by the Trustee shall be brought in the name of the Trustee for the
benefit of all the Holders of such Certificates, subject to the provisions of
this Agreement.
(c) The Depositor hereby directs the Trustee to execute, deliver and
perform its obligations under the Cap Contracts on the Closing Date and
thereafter on behalf of the Holders of the Class A Certificates (other than the
Class A-1 Certificates) and the Mezzanine Certificates. The Seller, the
Depositor, the Master Servicer and the Holders of the Class A Certificates
(other than the Class A-1 Certificates) and the Mezzanine Certificates by their
acceptance of such Certificates acknowledge and agree that the Trustee shall
execute, deliver and perform its obligations under the Cap Contracts and shall
do so solely in its capacity as Trustee of the Trust Fund and not in its
individual capacity. Every provision of this Agreement relating to the conduct
or affecting the liability of or affording protection to the Trustee shall apply
to the Trustee's execution of the Cap Contracts, and the performance of its
duties and satisfaction of its obligations thereunder.
SECTION 8.03. The Trustee Not Liable for Certificates or Mortgage
Loans.
The recitals contained herein and in the Certificates (other than
the signature of the Trustee, the authentication of the Certificate Registrar on
the Certificates, the acknowledgments of the Trustee contained in Article II and
the representations and warranties of the Trustee in Section 8.13) shall be
taken as the statements of the Depositor and the Trustee assumes no
responsibility for their correctness. The Trustee makes no representations or
warranties as to the validity or sufficiency of this Agreement (other than as
specifically set forth with respect to such party in Section 8.13) or of the
Certificates (other than the signature of the Trustee and authentication of the
Certificate Registrar on the Certificates) or of any Mortgage Loan or related
document. The Trustee shall not be accountable for the use or application by the
Depositor of any of the Certificates or of the proceeds of such Certificates, or
for the use or application of any funds paid to the Depositor or the Master
Servicer in respect of the Mortgage Loans or deposited in or withdrawn from the
Collection Account by the Master Servicer, other than, subject to Section 8.01,
any funds held by or on behalf of the Trustee in accordance with Section 3.04.
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SECTION 8.04. Trustee May Own Certificates.
The Trustee in its individual capacity or any other capacity may
become the owner or pledgee of Certificates with the same rights it would have
if it were not Trustee.
SECTION 8.05. Trustee's Fees and Expenses.
(a) The Trustee shall withdraw from the Distribution Account on each
Distribution Date and pay to itself the Trustee Fee and, to the extent that the
funds therein are at any time insufficient for such purpose, the Depositor shall
pay such fees. The Trustee, or any director, officer, employee or agent of the
Trustee shall be indemnified by REMIC I and held harmless against any loss,
liability or expense (not including expenses, disbursements and advances
incurred or made by the Trustee including the compensation and the expenses and
disbursements of its agents and counsel, in the ordinary course of the Trustee's
performance in accordance with the provisions of this Agreement) incurred by the
Trustee in connection with any claim or legal action or any pending or
threatened claim or legal action arising out of or in connection with the
acceptance or administration of its obligations and duties under this Agreement,
other than any loss, liability or expense (i) resulting from a breach of the
Master Servicer's obligations and duties under this Agreement and the Mortgage
Loans (for which the Master Servicer shall indemnify pursuant to Section
8.05(b)), (ii) that constitutes a specific liability of the Trustee pursuant to
Section 10.01(c) or (iii) any loss, liability or expense incurred by reason of
its willful misfeasance, bad faith or negligence in the performance of its
duties hereunder or by reason of reckless disregard of its obligations and
duties hereunder or as a result of a breach of its obligations under Article X
hereof. Any amounts payable to the Trustee, or any director, officer, employee
or agent of the Trustee in respect of the indemnification provided by this
paragraph (a), or pursuant to any other right of reimbursement from the Trust
Fund that the Trustee, or any director, officer, employee or agent of the
Trustee may have hereunder in its capacity as such, may be withdrawn by the
Trustee from the Distribution Account at any time.
(b) The Master Servicer agrees to indemnify the Trustee from, and
hold it harmless against, any loss, liability or expense resulting from a breach
of the Master Servicer's obligations and duties under this Agreement. Such
indemnity shall survive the termination or discharge of this Agreement and the
resignation or removal of the Trustee. Any payment hereunder made by the Master
Servicer to the Trustee shall be from the Master Servicer's own funds, without
reimbursement from the Trust Fund therefor.
(c) The Master Servicer shall pay any annual rating agency fees of
the Rating Agencies for ongoing surveillance from its own funds without right of
reimbursement.
SECTION 8.06. Eligibility Requirements for Trustee.
The Trustee hereunder shall at all times be a corporation or an
association (other than the Depositor, the Seller, the Master Servicer or any
Affiliate of the foregoing) 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 at least
$50,000,000 and subject to supervision or examination by federal or state
authority. If such corporation or association publishes reports of conditions at
least annually, pursuant to law or to the requirements of the
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aforesaid supervising or examining authority, then for the purposes of this
Section the combined capital and surplus of such corporation or association
shall be deemed to be its combined capital and surplus as set forth in its most
recent report of conditions so published. In case at any time the Trustee shall
cease to be eligible in accordance with the provisions of this Section, the
Trustee shall resign immediately in the manner and with the effect specified in
Section 8.07.
SECTION 8.07. Resignation and Removal of the Trustee.
The Trustee may at any time resign and be discharged from the trust
hereby created by giving written notice thereof to the Depositor, the NIMS
Insurer, the Master Servicer and the Certificateholders. Upon receiving such
notice of resignation of the Trustee, the Depositor shall promptly appoint a
successor trustee acceptable to the NIMS Insurer by written instrument, in
duplicate, which instrument shall be delivered to the resigning Trustee and to
the successor trustee. A copy of such instrument shall be delivered to the
Certificateholders, the Trustee and the Master Servicer by the Depositor. If no
successor trustee shall have been so appointed and have accepted appointment
within 30 days after the giving of such notice of resignation, the resigning
Trustee may petition any court of competent jurisdiction for the appointment of
a successor trustee.
If at any time the Trustee shall cease to be eligible in accordance
with the provisions of Section 8.06 and shall fail to resign after written
request therefor by the Depositor or the NIMS Insurer, or if at any time the
Trustee shall become incapable of acting, or shall be adjudged bankrupt or
insolvent, or a receiver of the Trustee or of its respective property shall be
appointed, or any public officer shall take charge or control of the Trustee or
of its respective property or affairs for the purpose of rehabilitation,
conservation or liquidation, then the Depositor or the NIMS Insurer may remove
the Trustee and appoint a successor trustee acceptable to the NIMS Insurer by
written instrument, in duplicate, which instrument shall be delivered to the
Trustee so removed and to the successor trustee. A copy of such instrument shall
be delivered to the Certificateholders and the Master Servicer by the Depositor.
The Holders of Certificates entitled to at least 51% of the Voting
Rights (or the NIMS Insurer upon failure of the Trustee to perform its
obligations hereunder) may at any time remove the Trustee and appoint a
successor trustee acceptable to the NIMS Insurer by written instrument or
instruments, in triplicate, signed by such Holders or their attorneys-in-fact
duly authorized, one complete set of which instruments shall be delivered to the
Depositor, one complete set to the Trustee so removed and one complete set to
the successor so appointed. A copy of such instrument shall be delivered to the
Certificateholders and the Master Servicer by the Depositor.
Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to any of the provisions of this Section shall not
become effective until acceptance of appointment by the successor trustee as
provided in Section 8.08.
SECTION 8.08. Successor Trustee.
Any successor trustee appointed as provided in Section 8.07 shall
execute, acknowledge and deliver to the Depositor, the NIMS Insurer 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
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or conveyance, shall become fully vested with all the rights, powers, duties and
obligations of its predecessor hereunder, with the like effect as if originally
named as trustee herein. The predecessor trustee shall deliver to the successor
trustee all Mortgage Files and related documents and statements, as well as all
moneys, held by it hereunder (other than any Mortgage Files at the time held by
a Custodian, which Custodian shall become the agent of any successor trustee
hereunder), and the Depositor and the predecessor trustee shall execute and
deliver such instruments and do such other things as may reasonably be required
for more fully and certainly vesting and confirming in the successor trustee all
such rights, powers, duties and obligations.
No successor trustee shall accept appointment as provided in this
Section unless at the time of such acceptance such successor trustee shall be
eligible under the provisions of Section 8.06 and the appointment of such
successor trustee shall not result in a downgrading of any Class of Certificates
by either Rating Agency, as evidenced by a letter from each Rating Agency.
Upon acceptance of appointment by a successor trustee as provided in
this Section, the Depositor shall mail notice of the succession of such trustee
hereunder to all Holders of Certificates at their addresses as shown in the
Certificate Register. If the Depositor fails to mail such notice within 10 days
after acceptance of appointment by the successor trustee, the successor trustee
shall cause such notice to be mailed at the expense of the Depositor.
SECTION 8.09. Merger or Consolidation of Trustee.
Any corporation or association into which the Trustee may be merged
or converted or with which it may be consolidated or any corporation or
association resulting from any merger, conversion or consolidation to which the
Trustee shall be a party, or any corporation or association succeeding to the
business of the Trustee shall be the successor of the Trustee hereunder,
provided such corporation or association shall be eligible under the provisions
of Section 8.06, without the execution or filing of any paper or any further act
on the part of any of the parties hereto, anything herein to the contrary
notwithstanding.
SECTION 8.10. Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions hereof, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of REMIC I or property securing the same may at the time be located, the Master
Servicer and the Trustee acting jointly shall have the power and shall execute
and deliver all instruments to appoint one or more Persons approved by the
Trustee and the NIMS Insurer to act as co-trustee or co-trustees, jointly with
the Trustee, or separate trustee or separate trustees, of all or any part of
REMIC I, and to vest in such Person or Persons, in such capacity, such title to
REMIC I, or any part thereof, and, subject to the other provisions of this
Section 8.10, such powers, duties, obligations, rights and trusts as the Master
Servicer and the Trustee may consider necessary or desirable. Any such
co-trustee or separate trustee shall be subject to the written approval of the
Master Servicer and the NIMS Insurer. If the Master Servicer and the NIMS
Insurer shall not have joined in such appointment within 15 days after the
receipt by it of a request so to do, or in case a Master Servicer Event of
Default shall have occurred and be continuing, the Trustee alone shall have the
power to make such appointment. No co-trustee or separate trustee hereunder
shall be required to meet the terms of eligibility as a successor trustee under
Section 8.06
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hereunder and no notice to Holders of Certificates of the appointment of
co-trustee(s) or separate trustee(s) shall be required under Section 8.08
hereof.
In the case of any appointment of a co-trustee or separate trustee
pursuant to this Section 8.10 all rights, powers, duties and obligations
conferred or imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or co-trustee
jointly, except to the extent that under any law of any jurisdiction in which
any particular act or acts are to be performed by the Trustee (whether as
Trustee hereunder or as successor to the Master Servicer hereunder), the Trustee
shall be incompetent or unqualified to perform such act or acts, in which event
such rights, powers, duties and obligations (including the holding of title to
REMIC I or any portion thereof in any such jurisdiction) shall be exercised and
performed by such separate trustee or co-trustee at the direction of the
Trustee.
Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the then separate trustees and co-trustees,
as effectively as if given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Agreement and the conditions
of this Article VIII. Each separate trustee and co-trustee, upon its acceptance
of the trust conferred, shall be vested with the estates or property specified
in its instrument of appointment, either jointly with the Trustee or separately,
as may be provided therein, subject to all the provisions of this Agreement,
specifically including every provision of this Agreement relating to the conduct
of, affecting the liability of, or affording protection to, the Trustee. Every
such instrument shall be filed with the Trustee and a copy thereof given to the
Depositor, the Master Servicer and the NIMS Insurer.
Any separate trustee or co-trustee may, at any time, constitute the
Trustee, its agent or attorney-in-fact, with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee, to the extent permitted by law, without the appointment of a new or
successor trustee.
SECTION 8.11. Appointment of Custodians.
The Trustee may, with the consent of the Depositor and the Master
Servicer appoint one or more Custodians to hold all or a portion of the Mortgage
Files as agent for the Trustee, by entering into a Custodial Agreement. The
appointment of any Custodian may at any time be terminated and a substitute
Custodian appointed therefor upon the reasonable request of the Master Servicer
to the Trustee, the consent to which shall not be unreasonably withheld. The
Trustee shall pay any and all fees and expenses of any Custodian in accordance
with each Custodial Agreement (provided that if expenses of the kind that would
be reimbursable to the Trustee pursuant to Section 8.05 if incurred by the
Trustee are incurred by the Custodian, the Trustee shall be entitled to
reimbursement under Section 8.05 for such kind of expenses to the extent the
Trustee has paid such expenses on behalf of the Custodian or for which the
Trustee has reimbursed the Custodian). The Trustee initially appoints the
Custodian as Custodian, and the Depositor and the Master Servicer consent to
such appointment. Subject to Article VIII hereof, the Trustee agrees to comply
with the terms of each Custodial Agreement and to enforce the terms and
provisions thereof against the Custodian for the benefit of the
Certificateholders having an interest in any Mortgage File held by
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such Custodian. Each Custodian shall be a depository institution or trust
company subject to supervision by federal or state authority, shall have
combined capital and surplus of at least $10,000,000 and shall be qualified to
do business in the jurisdiction in which it holds any Mortgage File. Each
Custodial Agreement may be amended only as provided in Section 11.01. In no
event shall the appointment of any Custodian pursuant to a Custodial Agreement
diminish the obligations of the Trustee hereunder.
SECTION 8.12. Appointment of Office or Agency.
The Trustee shall designate an office or agency in the City of New
York where the Certificates may be surrendered for registration of transfer or
exchange, and presented for final distribution, and where notices and demands to
or upon the Trustee in respect of the Certificates and this Agreement may be
delivered. As of the Closing Date, the Trustee designates the office of its
agent located c/o DTC Transfer Agent Services, 00 Xxxxx Xxxxxx, Xxxxxxxx Xxxx
Entrance, Xxx Xxxx, XX 00000 for such purposes.
SECTION 8.13. Representations and Warranties of the Trustee.
The Trustee hereby represents and warrants, to the Master Servicer
and the Depositor, as of the Closing Date, that:
(i) It is a national banking association duly organized, validly
existing and in good standing under the laws of the United States.
(ii) The execution and delivery of this Agreement by it, and the
performance and compliance with the terms of this Agreement by it, shall
not violate its charter or bylaws or constitute a default (or an event
which, with notice or lapse of time, or both, would constitute a default)
under, or result in the breach of, any material agreement or other
instrument to which it is a party or which is applicable to it or any of
its assets.
(iii) It has the full power and authority to enter into and
consummate all transactions contemplated by this Agreement, has duly
authorized the execution, delivery and performance of this Agreement, and
has duly executed and delivered this Agreement.
(iv) This Agreement, assuming due authorization, execution and
delivery by the other parties hereto, constitutes a valid, legal and
binding obligation of it, enforceable against it in accordance with the
terms hereof, subject to (A) applicable bankruptcy, insolvency,
receivership, reorganization, moratorium and other laws affecting the
enforcement of creditors' rights generally, and (B) general principles of
equity, regardless of whether such enforcement is considered in a
proceeding in equity or at law.
(v) It is not in violation of, and its execution and delivery of
this Agreement and its performance and compliance with the terms of this
Agreement shall not constitute a violation of, any law, any order or
decree of any court or arbiter, or any order, regulation or demand of any
federal, state or local governmental or regulatory authority, which
violation, in its good faith and reasonable judgment, is likely to affect
materially and adversely either the ability of it to perform its
obligations under this Agreement or its financial condition.
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(vi) No litigation is pending or, to the best knowledge, threatened
against it which would prohibit it from entering into this Agreement or,
in its good faith reasonable judgment, is likely to materially and
adversely affect either its ability to perform its obligations under this
Agreement or its financial condition.
ARTICLE IX
TERMINATION
SECTION 9.01 Termination Upon Repurchase or Liquidation of All
Mortgage Loans.
(a) Subject to Section 9.02, the respective obligations and
responsibilities under this Agreement of the Depositor, the Master Servicer and
the Trustee (other than the obligations of the Master Servicer to the Trustee
pursuant to Section 8.05 and of the Master Servicer to provide for and the
Trustee to make payments in respect of the REMIC I Regular Interests, the REMIC
II Regular Interests or the Classes of Certificates as hereinafter set forth)
shall terminate upon payment to the Certificateholders and the deposit of all
amounts held by or on behalf of the Trustee and required hereunder to be so paid
or deposited on the Distribution Date coinciding with or following the earlier
to occur of (i) the purchase by the Terminator (as defined below) of all
Mortgage Loans and each REO Property remaining in REMIC I and (ii) the final
payment or other liquidation (or any advance with respect thereto) of the last
Mortgage Loan or REO Property remaining in REMIC I; provided, however, that in
no event shall the trust created hereby continue beyond the expiration of 21
years from the death of the last survivor of the descendants of Xxxxxx X.
Xxxxxxx, the late ambassador of the United States to the Court of St. Xxxxx,
living on the date hereof. The purchase by the Terminator of all Mortgage Loans
and each REO Property remaining in REMIC I shall be at a price (the "Termination
Price") equal to greater of (A) the aggregate fair market value of all of the
assets of REMIC I and (B) the sum of the Stated Principal Balance of the
Mortgage Loans (after giving effect to scheduled payments of principal due
during the related Due Period, to the extent received or advanced, and
unscheduled collections of principal received during the related Prepayment
Period) and the appraised fair market value of the REO Properties plus accrued
interest through the end of the calendar month preceding the month of the final
Distribution Date and any unreimbursed Advances and Servicing Advances (in the
case of fair market values required to be determined under (A) or (B) above, as
determined by the Terminator, the Trustee and, if the Terminator is not the NIMS
Insurer, the NIMS Insurer, as of the close of business on the third Business Day
next preceding the date upon which notice of any such termination is furnished
to Certificateholders pursuant to the third paragraph of this Section 9.01);
provided, however, such option may only be exercised if the Termination Price is
sufficient to pay all interest accrued on, as well as amounts necessary to
retire the note balance of, each class of notes issued pursuant to the Indenture
and any amounts owed to the NIMS Insurer at the time the option is exercised.
(b) The majority Class CE Certificateholder and the Master Servicer
(or if each of the majority Class CE Certificateholder and the Master Servicer
fails to exercise such right, the NIMS Insurer) shall each have the right (the
party exercising such right, the "Terminator"), to purchase all of the Mortgage
Loans and each REO Property remaining in REMIC I pursuant to clause (i) of the
preceding paragraph no later than the Determination Date in the month
immediately
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preceding the Distribution Date on which the Certificates shall be retired;
provided, however, that the Terminator may elect to purchase all of the Mortgage
Loans and each REO Property remaining in REMIC I pursuant to clause (i) above
only (A) if the Terminator is the majority Class CE Certificateholder, if the
aggregate Stated Principal Balance of the Mortgage Loans and each REO Property
remaining in the Trust Fund at the time of such election is less than 10% of the
sum of (x) the aggregate Stated Principal Balance of the Initial Mortgage Loans
as of the Cut-off Date and (y) the Original Pre-Funded Amounts, (B) if the
Terminator is the Master Servicer, if the aggregate Stated Principal Balance of
the Mortgage Loans and each REO Property remaining in the Trust Fund at the time
of such election is less than 5% of the sum of (x) the aggregate Stated
Principal Balance of the Initial Mortgage Loans as of the Cut-off Date and (y)
the Original Pre-Funded Amounts and (C) if the Terminator is the Master Servicer
and is an affiliate of the Seller, the Master Servicer shall have delivered to
the Trustee and the NIMS Insurer a written certification that the burdens of
servicing the Mortgage Loans and REO Properties remaining in REMIC I exceed the
benefits of the Servicing Fees that would be realized by the Master Servicer if
it continued to service such assets on behalf of the Trust Fund. By acceptance
of the Residual Certificates, the Holders of the Residual Certificates agree, in
connection with any termination hereunder, to assign and transfer any amounts in
excess of par, and to the extent received in respect of such termination, to pay
any such amounts to the Holders of the Class CE Certificates.
(c) Notice of the liquidation of the REMIC I Regular Interests shall
be given promptly by the Trustee by letter to Certificateholders mailed (a) in
the event such notice is given in connection with the purchase of the Mortgage
Loans and each REO Property by the Terminator, not earlier than the 15th day and
not later than the 25th day of the month next preceding the month of the final
distribution on the Certificates or (b) otherwise during the month of such final
distribution on or before the Determination Date in such month, in each case
specifying (i) the Distribution Date upon which the Trust Fund shall terminate
and final payment in respect of the REMIC I Regular Interests, the REMIC II
Regular Interests and the Certificates shall be made upon presentation and
surrender of the related Certificates at the office of the Trustee therein
designated, (ii) the amount of any such final payment, (iii) that no interest
shall accrue in respect of the REMIC I Regular Interests, the REMIC II Regular
Interests or the Certificates from and after the Interest Accrual Period
relating to the final Distribution Date therefor and (iv) that the Record Date
otherwise applicable to such Distribution Date is not applicable, payments being
made only upon presentation and surrender of the Certificates at the office of
the Trustee. The Trustee shall give such notice to the Certificate Registrar at
the time such notice is given to Certificateholders. In the event such notice is
given in connection with the purchase of all of the Mortgage Loans and each REO
Property remaining in REMIC I by the Terminator, the Terminator shall deliver to
the Trustee for deposit in the Distribution Account not later than the last
Business Day preceding the final Distribution Date on the Certificates an amount
in immediately available funds equal to the above-described purchase price. Upon
certification to the Trustee by a Servicing Officer of the making of such final
deposit, the Trustee shall promptly release or cause to be released to the
Terminator the Mortgage Files for the remaining Mortgage Loans, and the Trustee
shall execute all assignments, endorsements and other instruments necessary to
effectuate such transfer.
(d) Upon presentation of the Certificates by the Certificateholders
on the final Distribution Date, the Trustee shall distribute to each
Certificateholder so presenting and surrendering its Certificates the amount
otherwise distributable on such Distribution Date in accordance with Section
4.01 in respect of the Certificates so presented and surrendered. Any funds
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not distributed to any Holder or Holders of Certificates being retired on such
Distribution Date because of the failure of such Holder or Holders to tender
their Certificates shall, on such date, be set aside and held in trust by the
Trustee and credited to the account of the appropriate non-tendering Holder or
Holders. If any Certificates as to which notice has been given pursuant to this
Section 9.01 shall not have been surrendered for cancellation within six months
after the time specified in such notice, the Trustee shall mail a second notice
to the remaining non-tendering Certificateholders to surrender their
Certificates for cancellation in order to receive the final distribution with
respect thereto. If within one year after the second notice all such
Certificates shall not have been surrendered for cancellation, the Trustee
shall, directly or through an agent, mail a final notice to remaining related
non-tendering Certificateholders concerning surrender of their Certificates. The
costs and expenses of maintaining the funds in trust and of contacting such
Certificateholders shall be paid out of the assets remaining in the trust funds.
If within one year after the final notice any such Certificates shall not have
been surrendered for cancellation, the Trustee shall pay to the Representative
all remaining amounts, and all rights of non-tendering Certificateholders in or
to such amounts shall thereupon cease. No interest shall accrue or be payable to
any Certificateholder on any amount held in trust by the Trustee as a result of
such Certificateholder's failure to surrender its Certificate(s) for final
payment thereof in accordance with this Section 9.01.
Immediately following the deposit of funds in trust hereunder in
respect of the Certificates, the Trust Fund shall terminate.
SECTION 9.02 Additional Termination Requirements.
(a) In the event that the Terminator purchases all the Mortgage
Loans and each REO Property or the final payment on or other liquidation of the
last Mortgage Loan or REO Property remaining in REMIC I pursuant to Section
9.01, the Trust Fund shall be terminated in accordance with the following
additional requirements:
(i) The Trustee shall specify the first day in the 90-day
liquidation period in a statement attached to each Trust REMIC's final Tax
Return pursuant to Treasury regulation Section 1.860F-1 and shall satisfy
all requirements of a qualified liquidation under Section 860F of the Code
and any regulations thereunder, as evidenced by an Opinion of Counsel
obtained at the expense of the Terminator;
(ii) During such 90-day liquidation period, and at or prior to the
time of making of the final payment on the Certificates, the Trustee shall
sell all of the assets of REMIC I to the Terminator for cash; and
(iii) At the time of the making of the final payment on the
Certificates, the Trustee shall distribute or credit, or cause to be
distributed or credited, to the Holders of the Residual Certificates all
cash on hand in the Trust Fund (other than cash retained to meet claims),
and the Trust Fund shall terminate at that time.
(b) At the expense of the applicable Terminator (or in the event of
termination under Section 9.01(a)(ii), at the expense of the Trustee), the
Trustee shall prepare or cause to be prepared the documentation required in
connection with the adoption of a plan of liquidation of each Trust REMIC
pursuant to this Section 9.02.
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(c) By their acceptance of Certificates, the Holders thereof hereby
agree to authorize the Trustee to specify the 90-day liquidation period for each
Trust REMIC which authorization shall be binding upon all successor
Certificateholders.
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ARTICLE X
REMIC PROVISIONS
SECTION 10.01. REMIC Administration.
(a) The Trustee shall elect to treat each Trust REMIC as a REMIC
under the Code and, if necessary, under applicable state law. Each such election
shall be made by the Trustee on Form 1066 or other appropriate federal tax or
information return or any appropriate state return for the taxable year ending
on the last day of the calendar year in which the Certificates are issued. For
the purposes of the REMIC election in respect of REMIC I, the REMIC I Regular
Interests shall be designated as the Regular Interests in REMIC I and the Class
R-I Interest shall be designated as the Residual Interest in REMIC I. The REMIC
II Regular Interests shall be designated as the Regular Interests in REMIC II
and the Class R-II Interest shall be designated as the Residual Interest in
REMIC II. The Class A Certificates and the Mezzanine Certificates (exclusive of
any right to receive payments from the Net WAC Rate Carryover Reserve Account),
the Class CE Interest and the Class P Interest shall be designated as the
Regular Interests in REMIC III and the Class R-III Interest shall be designated
as the Residual Interest in REMIC III. The CE Certificates shall be designated
as the Regular Interests in REMIC IV and the Class R-IV Interest shall be
designated as the Residual Interest in REMIC IV. The P Certificates shall be
designated as the Regular Interests in REMIC V and the Class R-V Interest shall
be designated as the Residual Interest in REMIC V. The Trustee shall not permit
the creation of any "interests" in any Trust REMIC (within the meaning of
Section 860G of the Code) other than the REMIC I Regular Interests, the REMIC II
Regular Interests, the Class CE Interest, the Class P Interest and the interests
represented by the Certificates.
(b) The Closing Date is hereby designated as the "Startup Day" of
each Trust REMIC within the meaning of Section 860G(a)(9) of the Code.
(c) The Trustee shall pay out of its own funds, without any right of
reimbursement, any and all expenses relating to any tax audit of the Trust Fund
caused by the Trustee (including, but not limited to, any professional fees or
any administrative or judicial proceedings with respect to any Trust REMIC that
involve the Internal Revenue Service or state tax authorities), other than the
expense of obtaining any tax related Opinion of Counsel except as specified
herein. The Trustee, as agent for each Trust REMIC's tax matters person, shall
(i) act on behalf of the Trust Fund in relation to any tax matter or controversy
involving any Trust REMIC and (ii) represent the Trust Fund in any
administrative or judicial proceeding relating to an examination or audit by any
governmental taxing authority with respect thereto. The holder of the largest
Percentage Interest of each Class of Residual Certificates shall be designated,
in the manner provided under Treasury regulations section 1.860F-4(d) and
Treasury regulations section 301.6231(a)(7)-1, as the tax matters person of the
related REMIC created hereunder. By their acceptance thereof, the holder of the
largest Percentage Interest of the Residual Certificates hereby agrees to
irrevocably appoint the Trustee or an Affiliate as its agent to perform all of
the duties of the tax matters person for the Trust Fund.
(d) The Trustee shall prepare, sign and file all of the Tax Returns
in respect of each REMIC created hereunder. The expenses of preparing and filing
such returns shall be borne by the Trustee without any right of reimbursement
therefor. The Master Servicer shall provide on
169
a timely basis to the Trustee or its designee such information with respect to
the assets of the Trust Fund as is in its possession and reasonably required by
the Trustee to enable it to perform its obligations under this Article.
(e) The Trustee shall perform on behalf of each Trust REMIC all
reporting and other tax compliance duties that are the responsibility of such
REMIC under the Code, the REMIC Provisions or other compliance guidance issued
by the Internal Revenue Service or any state or local taxing authority. Among
its other duties, as required by the Code, the REMIC Provisions or other such
compliance guidance, the Trustee shall provide (i) to any Transferor of a
Residual Certificate such information as is necessary for the application of any
tax relating to the transfer of a Residual Certificate to any Person who is not
a Permitted Transferee, (ii) to the Certificateholders such information or
reports as are required by the Code or the REMIC Provisions including reports
relating to interest, original issue discount and market discount or premium
(using the Prepayment Assumption as required) and (iii) to the Internal Revenue
Service the name, title, address and telephone number of the person who shall
serve as the representative of each Trust REMIC. The Master Servicer shall
provide on a timely basis to the Trustee such information with respect to the
assets of the Trust Fund, including, without limitation, the Mortgage Loans, as
is in its possession and reasonably required by the Trustee to enable each of
them to perform their respective obligations under this subsection. In addition,
the Depositor shall provide or cause to be provided to the Trustee, within ten
(10) days after the Closing Date, all information or data that the Trustee
reasonably determines to be relevant for tax purposes as to the valuations and
issue prices of the Certificates, including, without limitation, the price,
yield, prepayment assumption and projected cash flow of the Certificates.
(f) The Trustee shall take such action and shall cause each REMIC
created hereunder to take such action as shall be necessary to create or
maintain the status thereof as a REMIC under the REMIC Provisions (and the
Master Servicer shall assist it, to the extent reasonably requested by it). The
Trustee shall not take any action, cause the Trust Fund 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 any Trust REMIC as a REMIC or (ii) result in the imposition of a tax
upon the Trust Fund (including but not limited to the tax on prohibited
transactions as defined in Section 860F(a)(2) of the Code and the tax on
contributions to a REMIC set forth in Section 860G(d) of the Code) (either such
event, an "Adverse REMIC Event") unless the Trustee and the NIMS Insurer have
received an Opinion of Counsel, addressed to the Trustee (at the expense of the
party seeking to take such action but in no event at the expense of the Trustee)
to the effect that the contemplated action shall not, with respect to any Trust
REMIC, endanger such status or result in the imposition of such a tax, nor shall
the Master Servicer take or fail to take any action (whether or not authorized
hereunder) as to which the Trustee or the NIMS Insurer has advised it in writing
that it has received an Opinion of Counsel to the effect that an Adverse REMIC
Event could occur with respect to such action. In addition, prior to taking any
action with respect to any Trust REMIC or the respective assets of each, or
causing any Trust REMIC to take any action, which is not contemplated under the
terms of this Agreement, the Master Servicer shall consult with the Trustee, the
NIMS Insurer or its designee, in writing, with respect to whether such action
could cause an Adverse REMIC Event to occur with respect to any Trust REMIC, and
the Master Servicer shall not take any such action or cause any Trust REMIC to
take any such action as to which the Trustee or the NIMS Insurer has advised it
in writing that an Adverse REMIC Event could occur. The Trustee or the NIMS
Insurer may consult with counsel to make such
170
written advice, and the cost of same shall be borne by the party seeking to take
the action not permitted by this Agreement, but in no event shall such cost be
an expense of the Trustee. At all times as may be required by the Code, the
Master Servicer on behalf of the Trustee shall ensure that substantially all of
the assets of any Trust REMIC shall consist of "qualified mortgages" as defined
in Section 860G(a)(3) of the Code and "permitted investments" as defined in
Section 860G(a)(5) of the Code.
(g) In the event that any tax is imposed on "prohibited
transactions" of any REMIC created hereunder as defined in Section 860F(a)(2) of
the Code, on the "net income from foreclosure property" of such REMIC as defined
in Section 860G(c) of the Code, on any contributions to any such REMIC after the
Startup Day therefor pursuant to Section 860G(d) of the Code, or any other tax
is imposed by the Code or any applicable provisions of state or local tax laws,
such tax shall be charged (i) to the Trustee pursuant to Section 10.03 hereof,
if such tax arises out of or results from a breach by the Trustee of any of its
obligations under this Article X, (ii) to the Master Servicer pursuant to
Section 10.03 hereof, if such tax arises out of or results from a breach by the
Master Servicer of any of its obligations under Article III or this Article X,
or otherwise (iii) against amounts on deposit in the Distribution Account and
shall be paid by withdrawal therefrom.
(h) On or before April 15th of each calendar year, commencing April
15, 2005, the Trustee shall deliver to the Master Servicer, the NIMS Insurer and
each Rating Agency a Certificate from a Responsible Officer of the Trustee
stating, without regard to any action taken by any party other than the Trustee,
the Trustee's compliance with this Article X.
(i) The Trustee shall, for federal income tax purposes, maintain
books and records with respect to each Trust REMIC on a calendar year and on an
accrual basis. The Trustee shall apply for an Employer Identification Number for
the Trust Fund from the Internal Revenue Service via a Form SS-4 or such other
form as is appropriate.
(j) Following the Startup Day, the Trustee shall not accept any
contributions of assets to any Trust REMIC other than in connection with any
Qualified Substitute Mortgage Loan delivered in accordance with Section 2.03
unless it shall have received an Opinion of Counsel to the effect that the
inclusion of such assets in the Trust Fund shall not cause the related REMIC to
fail to qualify as a REMIC at any time that any Certificates are outstanding or
subject such REMIC to any tax under the REMIC Provisions or other applicable
provisions of federal, state and local law or ordinances.
(k) Neither the Trustee nor the Master Servicer shall enter into any
arrangement by which any Trust REMIC shall receive a fee or other compensation
for services nor permit any such REMIC to receive any income from assets other
than the Mortgage Pool which are deemed to constitute "qualified mortgages" as
defined in Section 860G(a)(3) of the Code or "permitted investments" as defined
in Section 860G(a)(5) of the Code.
SECTION 10.02. Prohibited Transactions and Activities.
None of the Depositor, the Master Servicer or the Trustee shall
sell, dispose of or substitute for any of the Mortgage Loans (except in
connection with (i) the foreclosure of a Mortgage Loan, including but not
limited to, the acquisition or sale of a Mortgaged Property acquired by deed
171
in lieu of foreclosure, (ii) the bankruptcy of REMIC I, (iii) the termination of
REMIC I pursuant to Article IX of this Agreement, (iv) a substitution pursuant
to Article II of this Agreement or (v) a purchase of Mortgage Loans pursuant to
Article II or III of this Agreement), nor acquire any assets for any Trust REMIC
(other than REO Property acquired in respect of a defaulted Mortgage Loan), nor
sell or dispose of any investments in the Collection Account or the Distribution
Account for gain, nor accept any contributions to any Trust REMIC after the
Closing Date (other than a Qualified Substitute Mortgage Loan delivered in
accordance with Section 2.03), unless it has received an Opinion of Counsel,
addressed to the Trustee and the NIMS Insurer (at the expense of the party
seeking to cause such sale, disposition, substitution, acquisition or
contribution but in no event at the expense of the Trustee) that such sale,
disposition, substitution, acquisition or contribution shall not (a) affect
adversely the status of any Trust REMIC as a REMIC or (b) cause any Trust REMIC
to be subject to a tax on "prohibited transactions" or "contributions" pursuant
to the REMIC Provisions.
SECTION 10.03. Master Servicer and Trustee Indemnification.
(a) The Trustee agrees to indemnify the Trust Fund, the NIMS
Insurer, the Depositor and the Master Servicer for any taxes and costs
including, without limitation, any reasonable attorneys fees imposed on or
incurred by the Trust Fund, the Depositor or the Master Servicer, caused solely
by the Trustee's failure to act in accordance with its standard of care set
forth in this Article X or any state, local or franchise taxes imposed upon the
Trust as a result of the location of the Trustee.
(b) The Master Servicer agrees to indemnify the Trust Fund, the NIMS
Insurer, the Depositor and the Trustee for any taxes and costs including,
without limitation, any reasonable attorneys' fees imposed on or incurred by the
Trust Fund, the Depositor or the Trustee, as a result of a breach of the Master
Servicer's covenants set forth in Article III or this Article X or any state,
local or franchise taxes imposed upon the Trust as a result of the location of
the Master Servicer or any subservicer.
172
ARTICLE XI
MISCELLANEOUS PROVISIONS
SECTION 11.01. Amendment.
This Agreement or any Custodial Agreement may be amended from time
to time by the Depositor, the Master Servicer, the Trustee and, if applicable,
the Custodian with the consent of the NIMS Insurer and without the consent of
any of the Certificateholders, (i) to cure any ambiguity or defect, (ii) to
correct, modify or supplement any provisions herein (including to give effect to
the expectations of Certificateholders), or in any Custodial Agreement, or (iii)
to make any other provisions with respect to matters or questions arising under
this Agreement or in any Custodial Agreement which shall not be inconsistent
with the provisions of this Agreement or such Custodial Agreement, provided that
such action shall not adversely affect in any material respect the interests of
any Certificateholder, as evidenced by either (i) an Opinion of Counsel
delivered to the Master Servicer and the Trustee to such effect or (ii)
confirmation from the Rating Agencies that such amendment shall not result in
the reduction or withdrawal of the rating of any outstanding Class of
Certificates. No amendment shall be deemed to adversely affect in any material
respect the interests of any Certificateholder who shall have consented thereto,
and no Opinion of Counsel shall be required to address the effect of any such
amendment on any such consenting Certificateholder.
This Agreement or any Custodial Agreement may also be amended from
time to time by the Depositor, the Master Servicer, the NIMS Insurer and the
Trustee with the consent of the NIMS Insurer and the Holders of Certificates
entitled to at least 66% of the Voting Rights for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Agreement or any Custodial Agreement or of modifying in any manner the
rights of the Holders of Certificates; provided, however, that no such amendment
shall (i) reduce in any manner the amount of, or delay the timing of, payments
received on Mortgage Loans which are required to be distributed on any
Certificate without the consent of the Holder of such Certificate, (ii)
adversely affect in any material respect the interests of the Holders of any
Class of Certificates (as evidenced by either (i) an Opinion of Counsel
delivered to the Trustee or (ii) written notice to the Depositor, the Master
Servicer and the Trustee from the Rating Agencies that such action shall not
result in the reduction or withdrawal of the rating of any outstanding Class of
Certificates with respect to which it is a Rating Agency) in a manner other than
as described in (i), or (iii) modify the consents required by the immediately
preceding clauses (i) and (ii) without the consent of the Holders of all
Certificates then outstanding. Notwithstanding any other provision of this
Agreement, for purposes of the giving or withholding of consents pursuant to
this Section 11.01, Certificates registered in the name of the Depositor or the
Master Servicer or any Affiliate thereof shall be entitled to Voting Rights with
respect to matters affecting such Certificates.
Notwithstanding any contrary provision of this Agreement, neither
the Trustee nor the NIMS Insurer shall consent to any amendment to this
Agreement unless it shall have first received an Opinion of Counsel satisfactory
to the NIMS Insurer to the effect that such amendment shall not result in the
imposition of any tax on any Trust REMIC pursuant to the REMIC Provisions or
cause any Trust REMIC to fail to qualify as a REMIC at any time that any
Certificates are outstanding.
173
Notwithstanding any of the other provisions of this Section 11.01,
none of the Depositor, the Master Servicer or the Trustee shall enter into any
amendment of this Agreement that would significantly change the permitted
activities of the Trust Fund without the consent of the NIMS Insurer and the
holders of Certificates that represent more than 50.00% of the aggregate
Certificate Principal Balance of all Certificates.
Promptly after the execution of any such amendment the Trustee shall
furnish a copy of such amendment to each Certificateholder.
It shall not be necessary for the consent of Certificateholders
under this Section 11.01 to approve the particular form of any proposed
amendment, but it shall be sufficient if such consent shall approve the
substance thereof. The manner of obtaining such consents and of evidencing the
authorization of the execution thereof by Certificateholders shall be subject to
such reasonable regulations as the Trustee may prescribe.
The cost of any Opinion of Counsel to be delivered pursuant to this
Section 11.01 shall be borne by the Person seeking the related amendment, but in
no event shall such Opinion of Counsel be an expense of the Trustee.
The Trustee may, but shall not be obligated to enter into any
amendment pursuant to this Section that affects its respective rights, duties
and immunities under this Agreement or otherwise.
SECTION 11.02. Recordation of Agreement; Counterparts.
To the extent permitted by applicable law, this Agreement is subject
to recordation in all appropriate public offices for real property records in
all the counties or other comparable jurisdictions in which any or all of the
properties subject to the Mortgages are situated, and in any other appropriate
public recording office or elsewhere, such recordation to be effected by the
Master Servicer at the expense of the Certificateholders, but only upon
direction of the Trustee accompanied by an Opinion of Counsel to the effect that
such recordation materially and beneficially affects the interests of the
Certificateholders.
For the purpose of facilitating the recordation of this Agreement as
herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute but one and
the same instrument.
SECTION 11.03. Limitation on Rights of Certificateholders.
The death or incapacity of any Certificateholder shall not operate
to terminate this Agreement or the Trust Fund, nor entitle such
Certificateholder's legal representatives or heirs to claim an accounting or to
take any action or proceeding in any court for a partition or winding up of the
Trust Fund, nor otherwise affect the rights, obligations and liabilities of the
parties hereto or any of them.
174
No Certificateholder shall have any right to vote (except as
expressly provided for herein) or in any manner otherwise control the operation
and management of the Trust Fund, or the obligations of the parties hereto, nor
shall anything herein set forth, or contained in the terms of any of the
Certificates, be construed so as to constitute the Certificateholders from time
to time as partners or members of an association; nor shall any
Certificateholder be under any liability to any third person by reason of any
action taken by the parties to this Agreement pursuant to any provision hereof.
No Certificateholder shall have any right by virtue of any provision
of this Agreement to institute any suit, action or proceeding in equity or at
law upon or under or with respect to this Agreement, unless (i) such Holder
previously shall have given to the Trustee a written notice of default and of
the continuance thereof, as hereinbefore provided, and (ii) the Holders of
Certificates entitled to at least 25% of the Voting Rights shall have made
written request upon the Trustee to institute such action, suit or proceeding in
the name of the Trustee hereunder and shall have offered to the Trustee such
reasonable indemnity as it may require against the costs, expenses and
liabilities to be incurred therein or thereby, and the Trustee, for 15 days
after its receipt of such notice, request and offer of indemnity, shall have
neglected or refused to institute any such action, suit or proceeding. It is
understood and intended, and expressly covenanted by each Certificateholder with
every other Certificateholder and the Trustee, that no one or more Holders of
Certificates shall have any right in any manner whatsoever by virtue of any
provision of this Agreement to affect, disturb or prejudice the rights of the
Holders of any other of such Certificates, or to obtain or seek to obtain
priority over or preference to any other such Holder, or to enforce any right
under this Agreement, except in the manner herein provided and for the equal,
ratable and common benefit of all Certificateholders. For the protection and
enforcement of the provisions of this Section, each and every Certificateholder
and the Trustee shall be entitled to such relief as can be given either at law
or in equity.
SECTION 11.04. Governing Law.
This Agreement shall be construed in accordance with the laws of the
State of New York and the obligations, rights and remedies of the parties
hereunder shall be determined in accordance with such laws excluding the choice
of laws provisions therein.
SECTION 11.05. Notices.
All directions, demands, requests, authorizations and notices
hereunder shall be in writing and shall be deemed to have been duly given when
received if personally delivered at or mailed by first class mail, postage
prepaid, or by express delivery service, facsimile, electronic mail or delivered
in any other manner specified herein, to (a) in the case of the Depositor, 0000
Xxxx & Xxxxxxx Xxxx, Xxxxx 0000, Xxxxxx, Xxxxxxxxxx 00000, Attention: Capital
Markets (telecopy number (000) 000-0000), or such other address or telecopy
number as may hereafter be furnished to the Master Servicer, the NIMS Insurer
and the Trustee in writing by the Depositor, (b) in the case of the Master
Servicer, 0000 Xxxx & Xxxxxxx Xxxx, 00xx Xxxxx, Xxxxxx, Xxxxxxxxxx 00000,
Attention: General Counsel (telecopy number: (000) 000-0000), or such other
address or telecopy number as may hereafter be furnished to the Trustee, the
NIMS Insurer and the Depositor in writing by the Master Servicer, (c) in the
case of the Trustee, Deutsche Bank National Trust Company, 0000 Xxxx Xx. Xxxxxx
Xxxxx, Xxxxx Xxx, XX 00000-0000, Attention: Trust Administration-AR0407
(telecopy
175
number: (000) 000-0000), or such other address or telecopy number as may
hereafter be furnished to the Master Servicer, the NIMS Insurer and the
Depositor in writing by the Trustee and (d) in the case of the NIMS Insurer,
such address furnished to the Depositor, the Master Servicer and the Trustee in
writing by the NIMS Insurer. Any notice required or permitted to be given to a
Certificateholder shall be given by first class mail, postage prepaid, at the
address of such Holder as shown in the Certificate Register. Any notice so
mailed within the time prescribed in this Agreement shall be conclusively
presumed to have been duly given when mailed, whether or not the
Certificateholder receives such notice. A copy of any notice required to be
telecopied hereunder also shall be mailed to the appropriate party in the manner
set forth above.
SECTION 11.06. Severability of Provisions.
If any one or more of the covenants, agreements, provisions or terms
of this Agreement shall 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 11.07. Notice to Rating Agencies and the NIMS Insurer.
The Trustee shall use its best efforts promptly to provide notice to
the Rating Agencies and the NIMS Insurer with respect to each of the following
of which it has actual knowledge:
1. Any material change or amendment to this Agreement;
2. The occurrence of any Master Servicer Event of Default that has
not been cured or waived;
3. The resignation or termination of the Master Servicer or the
Trustee;
4. The repurchase or substitution of Mortgage Loans pursuant to or
as contemplated by Section 2.03;
5. The final payment to the Holders of any Class of Certificates;
6. Any change in the location of the Collection Account or the
Distribution Account;
7. Any event that would result in the inability of the Trustee, were
it to succeed as Master Servicer, to make advances regarding delinquent
Mortgage Loans; and
8. The filing of any claim under the Master Servicer's blanket bond
and errors and omissions insurance policy required by Section 3.09 or the
cancellation or material modification of coverage under any such
instrument.
176
In addition, the Trustee shall promptly furnish to each Rating
Agency and the NIMS Insurer copies of each report to Certificateholders
described in Section 4.02 and the Master Servicer, as required pursuant to
Section 3.19 and Section 3.20, shall promptly furnish to each Rating Agency
copies of the following:
1. Each annual statement as to compliance described in Section 3.19;
and
2. Each annual independent public accountants' servicing report
described in Section 3.20.
Any such notice pursuant to this Section 11.07 shall be in writing
and shall be deemed to have been duly given if personally delivered at or mailed
by first class mail, postage prepaid, or by express delivery service to Xxxxx'x
Investors Service, 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, to Fitch Ratings,
0 Xxxxx Xxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 and to Standard & Poor's, a
division of the XxXxxx-Xxxx Companies, Inc., 00 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx
00000, or such other addresses as the Rating Agencies may designate in writing
to the parties hereto.
SECTION 11.08. Article and Section References.
All article and section references used in this Agreement, unless
otherwise provided, are to articles and sections in this Agreement.
SECTION 11.09. Grant of Security Interest.
It is the express intent of the parties hereto that the conveyance
of the Mortgage Loans by the Depositor to the Trustee be, and be construed as, a
sale of the Mortgage Loans by the Depositor and not a pledge of the Mortgage
Loans by the Depositor to secure a debt or other obligation of the Depositor or
the Seller. However, in the event that, notwithstanding the aforementioned
intent of the parties, the Mortgage Loans are held to be property of the
Depositor or the Seller, then, (a) it is the express intent of the parties that
such conveyance be deemed a pledge of the Mortgage Loans by the Depositor to the
Trustee to secure a debt or other obligation of the Depositor or the Seller and
(b)(1) this Agreement shall also be deemed to be a security agreement within the
meaning of Articles 8 and 9 of the Uniform Commercial Code as in effect from
time to time in the State of New York; (2) the conveyance provided for in
Section 2.01 hereof shall be deemed to be a grant by the Seller and the
Depositor to the Trustee of a security interest in all of the Seller's and the
Depositor's right, title and interest in and to the Mortgage Loans and all
amounts payable to the holders of the Mortgage Loans in accordance with the
terms thereof and all proceeds of the conversion, voluntary or involuntary, of
the foregoing into cash, instruments, securities or other property, including
without limitation all amounts, other than investment earnings, from time to
time held or invested in the Collection Account and the Distribution Account,
whether in the form of cash, instruments, securities or other property; (3) the
obligations secured by such security agreement shall be deemed to be all of the
Depositor's obligations under this Agreement, including the obligation to
provide to the Certificateholders the benefits of this Agreement relating to the
Mortgage Loans and the Trust Fund; and (4) notifications to persons holding such
property, and acknowledgments, receipts or confirmations from persons holding
such property, shall be deemed notifications to, or acknowledgments, receipts or
confirmations from, financial intermediaries, bailees or agents (as applicable)
of the Trustee for the purpose of perfecting such security interest
177
under applicable law. Accordingly, the Depositor hereby grants to the Trustee a
security interest in the Mortgage Loans and all other property described in
clause (2) of the preceding sentence, for the purpose of securing to the Trustee
the performance by the Depositor of the obligations described in clause (3) of
the preceding sentence. Notwithstanding the foregoing, the parties hereto intend
the conveyance pursuant to Section 2.01 and the transfer pursuant to the
Mortgage Loan Purchase Agreement to be a true, absolute and unconditional sale
of the Mortgage Loans and assets constituting the Trust Fund by the Depositor to
the Trustee.
SECTION 11.10 Third Party Rights.
The NIMS Insurer shall be deemed a third-party beneficiary of this
Agreement to the same extent as if it were a party hereto, and shall have the
right to enforce the provisions of this Agreement.
178
IN WITNESS WHEREOF, the Depositor, the Master Servicer and the
Trustee have caused their names to be signed hereto by their respective officers
thereunto duly authorized, in each case as of the day and year first above
written.
ARGENT SECURITIES INC.,
as Depositor
By: /s/ Xxxx X. Xxxxxx
----------------------------
Name: Xxxx X. Xxxxxx
Title: CFO
AMERIQUEST MORTGAGE COMPANY,
as Master Servicer
By: /s/ Xxxx X. Xxxxxx
----------------------------
Name: Xxxx X. Xxxxxx
Title: EVP
DEUTSCHE BANK NATIONAL TRUST
COMPANY,
as Trustee
By: /s/ Xxxxxxx Xxxxx
----------------------------
Name: Xxxxxxx Xxxxx
Title: Assistant Vice President
By: /s/ Xxxxxxx Xxxxxxx
----------------------------
Name: Xxxxxxx Xxxxxxx
Title: Associate
STATE OF CALIFORNIA )
) ss.:
COUNTY OF ORANGE )
On the 29th day of April 2004, before me, a notary public in
and for said State, personally appeared Xxxx X. Xxxxxx, known to me to be the
person executing as the Chief Financial Officer of Argent Securities Inc., one
of the corporations that executed the within instrument, and also known to me to
be the person who executed it on behalf of said corporation, and acknowledged to
me that such corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
/s/ Xxxxxx Xxxxxx
---------------------------------
Notary Public
[Notarial Seal]
STATE OF CALIFORNIA )
) ss.:
COUNTY OF ORANGE )
On the 29th day of April 2004, before me, a notary public in and for
said State, personally appeared Xxxx X. Xxxxxx, known to me to be the person
executing as the Executive Vice President of Ameriquest Mortgage Company, one of
the corporations that executed the within instrument, and also known to me to be
the person who executed it on behalf of said corporation, and acknowledged to me
that such corporation executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
/s/ Xxxxxx Xxxxxx
-------------------------------
Notary Public
[Notarial Seal]
STATE OF CALIFORNIA )
) ss.:
COUNTY OF ORANGE )
On the 30th day of April 2004, before me, a notary public in and for
said State, personally appeared Xxxxxxx Xxxxx, known to me to be an AVP and
Xxxxxxx Xxxxxxx, known to me to be an Associate of Deutsche Bank National Trust
Company, one of the entities that executed the within instrument, and also known
to me to be the person who executed it on behalf of said corporation, and
acknowledged to me that such entity executed the within instrument.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed my
official seal the day and year in this certificate first above written.
/s/ Xxx Xxxx Xxxxxxxx
---------------------------------
Notary Public
[Notarial Seal]
EXHIBIT A-1
FORM OF CLASS A-1 CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE
INTERNAL REVENUE CODE OF 1986 (THE "CODE").
Series 2004-W7, Class A-1 Aggregate Certificate Principal Balance
of the Class A-1 Certificates as of the
Issue Date:
Pass-Through Rate: Variable $558,360,000.00
Date of Pooling and Servicing Agreement Denomination: $558,360,000.00
and Cut-off Date: May 1, 2004
Master Servicer: Ameriquest Mortgage
First Distribution Date: June 25, 2004 Company
No. 1 Trustee: Deutsche Bank National Trust
Company
Issue Date: May 4, 2004
CUSIP: 040104 HW 4
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ABOVE AS THE DENOMINATION OF THIS CERTIFICATE.
A-1-1
ASSET-BACKED PASS-THROUGH CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional one- to four-family
adjustable-rate and fixed-rate first lien mortgage loans (the "Mortgage Loans")
formed and sold by
ARGENT SECURITIES INC.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ARGENT
SECURITIES INC., THE MASTER SERVICER, THE TRUSTEE OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING
MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES.
This certifies that Cede & Co. is the registered owner of a
Percentage Interest (obtained by dividing the denomination of this Certificate
by the aggregate Certificate Principal Balance of the Class A-1 Certificates as
of the Issue Date) in that certain beneficial ownership interest evidenced by
all the Class A-1 Certificates in a REMIC created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Argent
Securities Inc. (hereinafter called the "Depositor," which term includes any
successor entity under the Agreement), the Master Servicer and the Trustee, a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, the capitalized terms used herein have the
meanings assigned in the Agreement. This Certificate is issued under and is
subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of the acceptance hereof
assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
First Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class A-1 Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date or otherwise by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register. Notwithstanding the above, the final distribution on
this Certificate will be made after due notice by the Trustee of the pendency of
such distribution and only upon presentation and surrender of this Certificate
at the office or agency appointed by the Trustee for that purpose as provided in
the Agreement.
The Pass-Through Rate applicable to the calculation of interest
payable with respect to this Certificate on any Distribution Date shall be the
lesser of (x) the related Formula Rate for such
A-1-2
Distribution Date and (y) the Net WAC Pass-Through Rate for such Distribution
Date. For any Distribution Date and this Certificate, the Formula Rate is the
lesser of (a) One-Month LIBOR plus the Certificate Margin and (b) the Maximum
Cap Rate. The Certificate Margin with respect to this Certificate is 0.260% on
each Distribution Date through and including the Optional Termination Date and
0.520% thereafter.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset- Backed Pass-Through Certificates of the Series specified on
the face hereof (herein called the "Certificates") and representing a Percentage
Interest in the Class of Certificates specified on the face hereof equal to the
denomination specified on the face hereof divided by the aggregate Certificate
Principal Balance of the Class of Certificates specified on the face hereof.
The Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the Master
Servicer and the Trustee with the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other
A-1-3
governmental charge that may be imposed in connection with any transfer or
exchange of Certificates.
The Depositor, the Master Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Master Servicer, the Trustee or
the Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Master Servicer, the Trustee, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by the Trustee and required to be paid to them pursuant to the Agreement
following the earlier of (i) the final payment or other liquidation (or any
advance with respect thereto) of the last Mortgage Loan remaining in REMIC I,
and (ii) the purchase by the party designated in the Agreement at a price
determined as provided in the Agreement from REMIC I of all the Mortgage Loans
and all property acquired in respect of such Mortgage Loans. The Agreement
permits, but does not require, the party designated in the Agreement to purchase
from REMIC I all the Mortgage Loans and all property acquired in respect of any
Mortgage Loan at a price determined as provided in the Agreement. The exercise
of such right will effect early retirement of the Certificates; however, such
right to purchase is subject to the aggregate Stated Principal Balance of the
Mortgage Loans at the time of purchase being less than 10% of the sum of the
aggregate Stated Principal Balance of the Initial Mortgage Loans at the Cut- off
Date.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-1-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: May __, 2004
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Trustee
By:________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Certificate Registrar
By:________________________________
Authorized Signatory
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
----------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts to
Minors Act
JT TEN - as joint tenants with right if
survivorship and not as tenants ----------------------
in common (State)
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to____% evidenced by the within Asset-Backed Pass-
Through Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following
address:________________________________________________________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
A-1-6
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to__________________________________________________
________________________________ for the account of ___________________________,
account number______________ or, if mailed by check, to ________________________
_______________________________________________________________________________.
Applicable statements should be mailed to_______________________________________
________________________________________________________________________________
_______________________________________________________________________________.
This information is provided by
_______________________________________________, the assignee named above, or
____________________________________, as its agent.
X-0-0
XXXXXXX X-0
FORM OF CLASS A-2 CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE
INTERNAL REVENUE CODE OF 1986 (THE "CODE").
Series 2004-W7, Class A-2 Aggregate Certificate Principal
Balance of the Class A-2
Certificates as of the Issue Date:
Pass-Through Rate: Variable $ 62,040,000.00
Date of Pooling and Servicing Agreement Denomination: $ 62,040,000.00
and Cut-off Date: May 1, 2004
Master Servicer: Ameriquest Mortgage
First Distribution Date: June 25, 2004 Company
No. 1 Trustee: Deutsche Bank National Trust
Company
Issue Date: May 4, 2004
CUSIP: 040104 HX 2
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ABOVE AS THE DENOMINATION OF THIS CERTIFICATE.
A-2-1
ASSET-BACKED PASS-THROUGH CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional one- to four-family
adjustable-rate and fixed-rate first lien mortgage loans (the "Mortgage Loans")
formed and sold by
ARGENT SECURITIES INC.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ARGENT
SECURITIES INC., THE MASTER SERVICER, THE TRUSTEE OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING
MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES.
This certifies that Cede & Co. is the registered owner of a
Percentage Interest (obtained by dividing the denomination of this Certificate
by the aggregate Certificate Principal Balance of the Class A-2 Certificates as
of the Issue Date) in that certain beneficial ownership interest evidenced by
all the Class A-2 Certificates in a REMIC created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Argent
Securities Inc. (hereinafter called the "Depositor," which term includes any
successor entity under the Agreement), the Master Servicer and the Trustee, a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, the capitalized terms used herein have the
meanings assigned in the Agreement. This Certificate is issued under and is
subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of the acceptance hereof
assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
First Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class A-2 Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date or otherwise by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register. Notwithstanding the above, the final distribution on
this Certificate will be made after due notice by the Trustee of the pendency of
such distribution and only upon presentation and surrender of this Certificate
at the office or agency appointed by the Trustee for that purpose as provided in
the Agreement.
The Pass-Through Rate applicable to the calculation of interest
payable with respect to this Certificate on any Distribution Date shall be the
lesser of (x) the related Formula Rate for such
A-2-2
Distribution Date and (y) the Net WAC Pass-Through Rate for such Distribution
Date. For any Distribution Date and this Certificate, the Formula Rate is the
lesser of (a) One-Month LIBOR plus the Certificate Margin and (b) the Maximum
Cap Rate. The Certificate Margin with respect to this Certificate is 0.520% on
each Distribution Date through and including the Optional Termination Date and
1.040% thereafter.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset- Backed Pass-Through Certificates of the Series specified on
the face hereof (herein called the "Certificates") and representing a Percentage
Interest in the Class of Certificates specified on the face hereof equal to the
denomination specified on the face hereof divided by the aggregate Certificate
Principal Balance of the Class of Certificates specified on the face hereof.
The Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the Master
Servicer and the Trustee with the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other
A-2-3
governmental charge that may be imposed in connection with any transfer or
exchange of Certificates.
The Depositor, the Master Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Master Servicer, the Trustee or
the Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Master Servicer, the Trustee, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by the Trustee and required to be paid to them pursuant to the Agreement
following the earlier of (i) the final payment or other liquidation (or any
advance with respect thereto) of the last Mortgage Loan remaining in REMIC I,
and (ii) the purchase by the party designated in the Agreement at a price
determined as provided in the Agreement from REMIC I of all the Mortgage Loans
and all property acquired in respect of such Mortgage Loans. The Agreement
permits, but does not require, the party designated in the Agreement to purchase
from REMIC I all the Mortgage Loans and all property acquired in respect of any
Mortgage Loan at a price determined as provided in the Agreement. The exercise
of such right will effect early retirement of the Certificates; however, such
right to purchase is subject to the aggregate Stated Principal Balance of the
Mortgage Loans at the time of purchase being less than 10% of the sum of the
aggregate Stated Principal Balance of the Initial Mortgage Loans at the Cut- off
Date.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-2-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: May __, 2004
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Trustee
By:_____________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Certificate Registrar
By:_____________________________
Authorized Signatory
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
----------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts to
Minors Act
JT TEN - as joint tenants with right if
survivorship and not as tenants ----------------------
in common (State)
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to____% evidenced by the within Asset-Backed Pass-
Through Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:__________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
A-2-6
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________ for the account of ___________________________,
account number______________ or, if mailed by check, to ________________________
_______________________________________________________________________________.
Applicable statements should be mailed to_______________________________________
________________________________________________________________________________
_______________________________________________________________________________.
This information is provided by __________________________________, the
assignee named above, or ____________________________________, as its agent.
X-0-0
XXXXXXX X-0
FORM OF CLASS A-3 CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE
INTERNAL REVENUE CODE OF 1986 (THE "CODE").
Series 2004-W7, Class A-3 Aggregate Certificate Principal
Balance of the Class A-3
Certificates as of the Issue Date:
Pass-Through Rate: Variable $ 88,000,000.00
Date of Pooling and Servicing Agreement Denomination: $ 88,000,000.00
and Cut-off Date: May 1, 2004
Master Servicer: Ameriquest Mortgage
First Distribution Date: June 25, 2004 Company
No. 1 Trustee: Deutsche Bank National
Trust Company
Issue Date: May 4, 2004
CUSIP: 040104 HY 0
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ABOVE AS THE DENOMINATION OF THIS CERTIFICATE.
A-3-1
ASSET-BACKED PASS-THROUGH CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional one- to four-family
adjustable-rate and fixed-rate first lien mortgage loans (the "Mortgage Loans")
formed and sold by
ARGENT SECURITIES INC.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ARGENT
SECURITIES INC., THE MASTER SERVICER, THE TRUSTEE OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING
MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES.
This certifies that Cede & Co. is the registered owner of a
Percentage Interest (obtained by dividing the denomination of this Certificate
by the aggregate Certificate Principal Balance of the Class A-3 Certificates as
of the Issue Date) in that certain beneficial ownership interest evidenced by
all the Class A-3 Certificates in a REMIC created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Argent
Securities Inc. (hereinafter called the "Depositor," which term includes any
successor entity under the Agreement), the Master Servicer and the Trustee, a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, the capitalized terms used herein have the
meanings assigned in the Agreement. This Certificate is issued under and is
subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of the acceptance hereof
assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
First Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class A-3 Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date or otherwise by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register. Notwithstanding the above, the final distribution on
this Certificate will be made after due notice by the Trustee of the pendency of
such distribution and only upon presentation and surrender of this Certificate
at the office or agency appointed by the Trustee for that purpose as provided in
the Agreement.
The Pass-Through Rate applicable to the calculation of interest
payable with respect to this Certificate on any Distribution Date shall be the
lesser of (x) the related Formula Rate for such
A-3-2
Distribution Date and (y) the Net WAC Pass-Through Rate for such Distribution
Date. For any Distribution Date and this Certificate, the Formula Rate is the
lesser of (a) One-Month LIBOR plus the Certificate Margin and (b) the Maximum
Cap Rate. The Certificate Margin with respect to this Certificate is 0.110% on
each Distribution Date through and including the Optional Termination Date and
0.220% thereafter.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset- Backed Pass-Through Certificates of the Series specified on
the face hereof (herein called the "Certificates") and representing a Percentage
Interest in the Class of Certificates specified on the face hereof equal to the
denomination specified on the face hereof divided by the aggregate Certificate
Principal Balance of the Class of Certificates specified on the face hereof.
The Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the Master
Servicer and the Trustee with the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other
A-3-3
governmental charge that may be imposed in connection with any transfer or
exchange of Certificates.
The Depositor, the Master Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Master Servicer, the Trustee or
the Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Master Servicer, the Trustee, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by the Trustee and required to be paid to them pursuant to the Agreement
following the earlier of (i) the final payment or other liquidation (or any
advance with respect thereto) of the last Mortgage Loan remaining in REMIC I,
and (ii) the purchase by the party designated in the Agreement at a price
determined as provided in the Agreement from REMIC I of all the Mortgage Loans
and all property acquired in respect of such Mortgage Loans. The Agreement
permits, but does not require, the party designated in the Agreement to purchase
from REMIC I all the Mortgage Loans and all property acquired in respect of any
Mortgage Loan at a price determined as provided in the Agreement. The exercise
of such right will effect early retirement of the Certificates; however, such
right to purchase is subject to the aggregate Stated Principal Balance of the
Mortgage Loans at the time of purchase being less than 10% of the sum of the
aggregate Stated Principal Balance of the Initial Mortgage Loans at the Cut- off
Date.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-3-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: May __, 2004
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Trustee
By:______________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Certificate Registrar
By:______________________________
Authorized Signatory
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
----------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts to
Minors Act
JT TEN - as joint tenants with right if
survivorship and not as tenants ----------------------
in common (State)
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to____% evidenced by the within Asset-Backed Pass-
Through Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:__________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
A-3-6
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to__________________________________________________
________________________________ for the account of ___________________________,
account number______________ or, if mailed by check, to ________________________
_______________________________________________________________________________.
Applicable statements should be mailed to_______________________________________
________________________________________________________________________________
_______________________________________________________________________________.
This information is provided by ___________________________________, the
assignee named above, or ____________________________________, as its agent.
X-0-0
XXXXXXX X-0
FORM OF CLASS A-4 CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE
INTERNAL REVENUE CODE OF 1986 (THE "CODE").
Series 2004-W7, Class A-4 Aggregate Certificate Principal
Balance of the Class A-4
Certificates as of the Issue Date:
Pass-Through Rate: Variable $ 42,700,000.00
Date of Pooling and Servicing Agreement Denomination: $ 42,700,000.00
and Cut-off Date: May 1, 2004
Master Servicer: Ameriquest Mortgage
First Distribution Date: June 25, 2004 Company
No. 1 Trustee: Deutsche Bank National
Trust Company
Issue Date: May 4, 2004
CUSIP: 040104 HZ 7
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ABOVE AS THE DENOMINATION OF THIS CERTIFICATE.
A-4-1
ASSET-BACKED PASS-THROUGH CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional one- to four-family
adjustable-rate and fixed-rate first lien mortgage loans (the "Mortgage Loans")
formed and sold by
ARGENT SECURITIES INC.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ARGENT
SECURITIES INC., THE MASTER SERVICER, THE TRUSTEE OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING
MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES.
This certifies that Cede & Co. is the registered owner of a
Percentage Interest (obtained by dividing the denomination of this Certificate
by the aggregate Certificate Principal Balance of the Class A-4 Certificates as
of the Issue Date) in that certain beneficial ownership interest evidenced by
all the Class A-4 Certificates in a REMIC created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Argent
Securities Inc. (hereinafter called the "Depositor," which term includes any
successor entity under the Agreement), the Master Servicer and the Trustee, a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, the capitalized terms used herein have the
meanings assigned in the Agreement. This Certificate is issued under and is
subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of the acceptance hereof
assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
First Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class A-4 Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date or otherwise by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register. Notwithstanding the above, the final distribution on
this Certificate will be made after due notice by the Trustee of the pendency of
such distribution and only upon presentation and surrender of this Certificate
at the office or agency appointed by the Trustee for that purpose as provided in
the Agreement.
The Pass-Through Rate applicable to the calculation of interest
payable with respect to this Certificate on any Distribution Date shall be the
lesser of (x) the related Formula Rate for such
A-4-2
Distribution Date and (y) the Net WAC Pass-Through Rate for such Distribution
Date. For any Distribution Date and this Certificate, the Formula Rate is the
lesser of (a) One-Month LIBOR plus the Certificate Margin and (b) the Maximum
Cap Rate. The Certificate Margin with respect to this Certificate is 0.220% on
each Distribution Date through and including the Optional Termination Date and
0.440% thereafter.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset- Backed Pass-Through Certificates of the Series specified on
the face hereof (herein called the "Certificates") and representing a Percentage
Interest in the Class of Certificates specified on the face hereof equal to the
denomination specified on the face hereof divided by the aggregate Certificate
Principal Balance of the Class of Certificates specified on the face hereof.
The Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the Master
Servicer and the Trustee with the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other
A-4-3
governmental charge that may be imposed in connection with any transfer or
exchange of Certificates.
The Depositor, the Master Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Master Servicer, the Trustee or
the Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Master Servicer, the Trustee, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by the Trustee and required to be paid to them pursuant to the Agreement
following the earlier of (i) the final payment or other liquidation (or any
advance with respect thereto) of the last Mortgage Loan remaining in REMIC I,
and (ii) the purchase by the party designated in the Agreement at a price
determined as provided in the Agreement from REMIC I of all the Mortgage Loans
and all property acquired in respect of such Mortgage Loans. The Agreement
permits, but does not require, the party designated in the Agreement to purchase
from REMIC I all the Mortgage Loans and all property acquired in respect of any
Mortgage Loan at a price determined as provided in the Agreement. The exercise
of such right will effect early retirement of the Certificates; however, such
right to purchase is subject to the aggregate Stated Principal Balance of the
Mortgage Loans at the time of purchase being less than 10% of the sum of the
aggregate Stated Principal Balance of the Initial Mortgage Loans at the Cut- off
Date.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-4-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: May __, 2004
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Trustee
By:________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Certificate Registrar
By:________________________________
Authorized Signatory
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
----------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts to
Minors Act
JT TEN - as joint tenants with right if
survivorship and not as tenants ----------------------
in common (State)
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to____% evidenced by the within Asset-Backed Pass-
Through Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:__________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
A-4-6
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to__________________________________________________
________________________________ for the account of ___________________________,
account number______________ or, if mailed by check, to ________________________
_______________________________________________________________________________.
Applicable statements should be mailed to_______________________________________
________________________________________________________________________________
_______________________________________________________________________________.
This information is provided by ___________________________________, the
assignee named above, or ____________________________________, as its agent.
X-0-0
XXXXXXX X-0
FORM OF CLASS A-5 CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE
INTERNAL REVENUE CODE OF 1986 (THE "CODE").
Series 2004-W7, Class A-5 Aggregate Certificate Principal
Balance of the Class A-5
Certificates as of the Issue Date:
Pass-Through Rate: Variable $ 28,900,000.00
Date of Pooling and Servicing Agreement Denomination: $ 28,900,000.00
and Cut-off Date: May 1, 2004
Master Servicer: Ameriquest Mortgage
First Distribution Date: June 25, 2004 Company
No. 1 Trustee: Deutsche Bank National Trust
Company
Issue Date: May 4, 2004
CUSIP: 040104 JA 0
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ABOVE AS THE DENOMINATION OF THIS CERTIFICATE.
A-5-1
ASSET-BACKED PASS-THROUGH CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional one- to four-family
adjustable-rate and fixed-rate first lien mortgage loans (the "Mortgage Loans")
formed and sold by
ARGENT SECURITIES INC.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ARGENT
SECURITIES INC., THE MASTER SERVICER, THE TRUSTEE OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING
MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES.
This certifies that Cede & Co. is the registered owner of a
Percentage Interest (obtained by dividing the denomination of this Certificate
by the aggregate Certificate Principal Balance of the Class A-5 Certificates as
of the Issue Date) in that certain beneficial ownership interest evidenced by
all the Class A-5 Certificates in a REMIC created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Argent
Securities Inc. (hereinafter called the "Depositor," which term includes any
successor entity under the Agreement), the Master Servicer and the Trustee, a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, the capitalized terms used herein have the
meanings assigned in the Agreement. This Certificate is issued under and is
subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of the acceptance hereof
assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
First Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class A-5 Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date or otherwise by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register. Notwithstanding the above, the final distribution on
this Certificate will be made after due notice by the Trustee of the pendency of
such distribution and only upon presentation and surrender of this Certificate
at the office or agency appointed by the Trustee for that purpose as provided in
the Agreement.
The Pass-Through Rate applicable to the calculation of interest
payable with respect to this Certificate on any Distribution Date shall be the
lesser of (x) the related Formula Rate for such
A-5-2
Distribution Date and (y) the Net WAC Pass-Through Rate for such Distribution
Date. For any Distribution Date and this Certificate, the Formula Rate is the
lesser of (a) One-Month LIBOR plus the Certificate Margin and (b) the Maximum
Cap Rate. The Certificate Margin with respect to this Certificate is 0.530% on
each Distribution Date through and including the Optional Termination Date and
1.060% thereafter.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset- Backed Pass-Through Certificates of the Series specified on
the face hereof (herein called the "Certificates") and representing a Percentage
Interest in the Class of Certificates specified on the face hereof equal to the
denomination specified on the face hereof divided by the aggregate Certificate
Principal Balance of the Class of Certificates specified on the face hereof.
The Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the Master
Servicer and the Trustee with the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other
A-5-3
governmental charge that may be imposed in connection with any transfer or
exchange of Certificates.
The Depositor, the Master Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Master Servicer, the Trustee or
the Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Master Servicer, the Trustee, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by the Trustee and required to be paid to them pursuant to the Agreement
following the earlier of (i) the final payment or other liquidation (or any
advance with respect thereto) of the last Mortgage Loan remaining in REMIC I,
and (ii) the purchase by the party designated in the Agreement at a price
determined as provided in the Agreement from REMIC I of all the Mortgage Loans
and all property acquired in respect of such Mortgage Loans. The Agreement
permits, but does not require, the party designated in the Agreement to purchase
from REMIC I all the Mortgage Loans and all property acquired in respect of any
Mortgage Loan at a price determined as provided in the Agreement. The exercise
of such right will effect early retirement of the Certificates; however, such
right to purchase is subject to the aggregate Stated Principal Balance of the
Mortgage Loans at the time of purchase being less than 10% of the sum of the
aggregate Stated Principal Balance of the Initial Mortgage Loans at the Cut- off
Date.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-5-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: May __, 2004
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Trustee
By:_____________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Certificate Registrar
By:_____________________________
Authorized Signatory
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
----------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts to
Minors Act
JT TEN - as joint tenants with right if
survivorship and not as tenants ----------------------
in common (State)
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to____% evidenced by the within Asset-Backed Pass-
Through Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:__________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
A-5-6
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to__________________________________________________
________________________________ for the account of ___________________________,
account number______________ or, if mailed by check, to ________________________
_______________________________________________________________________________.
Applicable statements should be mailed to ______________________________________
________________________________________________________________________________
_______________________________________________________________________________.
This information is provided by _________________________________________,
the assignee named above, or ____________________________________, as its agent.
X-0-0
XXXXXXX X-0
FORM OF CLASS M-1 CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF
THE INTERNAL REVENUE CODE OF 1986 (THE "CODE").
Series 2004-W7, Class M-1 Aggregate Certificate Principal
Balance of the Class M-1 Certificates
as of the Issue Date: Pass-Through
Rate: Variable $ 40,000,000.00
Date of Pooling and Servicing Agreement Denomination: $ 40,000,000.00
and Cut-off Date: May 1, 2004
Master Servicer: Ameriquest Mortgage
First Distribution Date: June 25, 2004 Company
No. 1 Trustee: Deutsche Bank National Trust
Company
Issue Date: May 4, 2004
CUSIP: 040104 JB 8
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ABOVE AS THE DENOMINATION OF THIS CERTIFICATE.
ANY TRANSFEREE OF THIS CERTIFICATE SHALL BE DEEMED TO MAKE THE
REPRESENTATIONS SET FORTH IN SECTION 5.02(c) OF THE AGREEMENT.
A-6-1
ASSET-BACKED PASS-THROUGH CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional one- to four-family
adjustable-rate and fixed-rate first lien mortgage loans (the "Mortgage Loans")
formed and sold by
ARGENT SECURITIES INC.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ARGENT
SECURITIES INC., THE MASTER SERVICER, THE TRUSTEE OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING
MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES.
This certifies that Cede & Co. is the registered owner of a
Percentage Interest (obtained by dividing the denomination of this Certificate
by the aggregate Certificate Principal Balance of the Class M-1 Certificates as
of the Issue Date) in that certain beneficial ownership interest evidenced by
all the Class M-1 Certificates in a REMIC created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Argent
Securities Inc. (hereinafter called the "Depositor," which term includes any
successor entity under the Agreement), the Master Servicer and the Trustee, a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, the capitalized terms used herein have the
meanings assigned in the Agreement. This Certificate is issued under and is
subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of the acceptance hereof
assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
First Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class M-1 Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date or otherwise by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register. Notwithstanding the above, the final distribution on
this Certificate will be made after due notice by the Trustee of the pendency of
such distribution and only upon presentation and surrender of this Certificate
at the office or agency appointed by the Trustee for that purpose as provided in
the Agreement.
The Pass-Through Rate applicable to the calculation of interest
payable with respect to this Certificate on any Distribution Date shall be the
lesser of (x) the related Formula Rate for such
A-6-2
Distribution Date and (y) the Net WAC Pass-Through Rate for such Distribution
Date. For any Distribution Date and this Certificate, the Formula Rate is the
lesser of (a) One-Month LIBOR plus the Certificate Margin and (b) the Maximum
Cap Rate. The Certificate Margin with respect to this Certificate is 0.550% each
Distribution Date through and including the Optional Termination Date and 0.825%
thereafter.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset- Backed Pass-Through Certificates of the Series specified on
the face hereof (herein called the "Certificates") and representing a Percentage
Interest in the Class of Certificates specified on the face hereof equal to the
denomination specified on the face hereof divided by the aggregate Certificate
Principal Balance of the Class of Certificates specified on the face hereof.
The Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
Any transferee of this Certificate shall be deemed to make the
representations set forth in Section 5.02(c) of the Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the Master
Servicer and the Trustee with the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
A-6-3
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
The Depositor, the Master Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Master Servicer, the Trustee or
the Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Master Servicer, the Trustee, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by the Trustee and required to be paid to them pursuant to the Agreement
following the earlier of (i) the final payment or other liquidation (or any
advance with respect thereto) of the last Mortgage Loan remaining in REMIC I,
and (ii) the purchase by the party designated in the Agreement at a price
determined as provided in the Agreement from REMIC I of all the Mortgage Loans
and all property acquired in respect of such Mortgage Loans. The Agreement
permits, but does not require, the party designated in the Agreement to purchase
from REMIC I all the Mortgage Loans and all property acquired in respect of any
Mortgage Loan at a price determined as provided in the Agreement. The exercise
of such right will effect early retirement of the Certificates; however, such
right to purchase is subject to the aggregate Stated Principal Balance of the
Mortgage Loans at the time of purchase being less than 10% of the sum of the
aggregate Stated Principal Balance of the Initial Mortgage Loans at the Cut- off
Date.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-6-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: May __, 2004
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Trustee
By:________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Certificate Registrar
By:________________________________
Authorized Signatory
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
----------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts to
Minors Act
JT TEN - as joint tenants with right if
survivorship and not as tenants ----------------------
in common (State)
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to____% evidenced by the within Asset-Backed Pass-
Through Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:__________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
A-6-6
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to__________________________________________________
________________________________ for the account of ___________________________,
account number______________ or, if mailed by check, to ________________________
____________________________________.
Applicable statements should be mailed to______________________________________
________________________________________________________________________________
_______________________________________________________________________________.
This information is provided by _______________________________________________,
the assignee named above, or ____________________________________, as its agent.
X-0-0
XXXXXXX X-0
FORM OF CLASS M-2 CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE
INTERNAL REVENUE CODE OF 1986 (THE "CODE").
THIS CERTIFICATE IS SUBORDINATE TO EACH CLASS OF CLASS A CERTIFICATES AND
THE CLASS M-1 CERTIFICATES TO THE EXTENT DESCRIBED IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
Series 2004-W7, Class M-2 Aggregate Certificate Principal
Balance of the Class M-2 Certificates
as of the Issue Date:
Pass-Through Rate: Variable $ 32,500,000.00
Date of Pooling and Servicing Agreement Denomination: $ 32,500,000.00
and Cut-off Date: May 1, 2004
Master Servicer: Ameriquest Mortgage
First Distribution Date: June 25, 2004 Company
No. 1 Trustee: Deutsche Bank National Trust
Company
Issue Date: May 4, 2004
CUSIP: 040104 JC 6
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ABOVE AS THE DENOMINATION OF THIS CERTIFICATE.
ANY TRANSFEREE OF THIS CERTIFICATE SHALL BE DEEMED TO MAKE THE
REPRESENTATIONS SET FORTH IN SECTION 5.02(c) OF THE AGREEMENT.
A-7-1
ASSET-BACKED PASS-THROUGH CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional one- to four-family
adjustable-rate and fixed-rate first lien mortgage loans (the "Mortgage Loans")
formed and sold by
ARGENT SECURITIES INC.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ARGENT
SECURITIES INC., THE MASTER SERVICER, THE TRUSTEE OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING
MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES.
This certifies that Cede & Co. is the registered owner of a
Percentage Interest (obtained by dividing the denomination of this Certificate
by the aggregate Certificate Principal Balance of the Class M-2 Certificates as
of the Issue Date) in that certain beneficial ownership interest evidenced by
all the Class M-2 Certificates in a REMIC created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Argent
Securities Inc. (hereinafter called the "Depositor," which term includes any
successor entity under the Agreement), the Master Servicer and the Trustee, a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, the capitalized terms used herein have the
meanings assigned in the Agreement. This Certificate is issued under and is
subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of the acceptance hereof
assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
First Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class M-2 Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date or otherwise by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register. Notwithstanding the above, the final distribution on
this Certificate will be made after due notice by the Trustee of the pendency of
such distribution and only upon presentation and surrender of this Certificate
at the office or agency appointed by the Trustee for that purpose as provided in
the Agreement.
The Pass-Through Rate applicable to the calculation of interest
payable with respect to this Certificate on any Distribution Date shall be the
lesser of (x) the related Formula Rate for such
A-7-2
Distribution Date and (y) the Net WAC Pass-Through Rate for such Distribution
Date. For any Distribution Date and this Certificate, the Formula Rate is the
lesser of (a) One-Month LIBOR plus the Certificate Margin and (b) the Maximum
Cap Rate. The Certificate Margin with respect to this Certificate is 0.600% each
Distribution Date through and including the Optional Termination Date and 0.900%
thereafter.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset- Backed Pass-Through Certificates of the Series specified on
the face hereof (herein called the "Certificates") and representing a Percentage
Interest in the Class of Certificates specified on the face hereof equal to the
denomination specified on the face hereof divided by the aggregate Certificate
Principal Balance of the Class of Certificates specified on the face hereof.
The Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
Any transferee of this Certificate shall be deemed to make the
representations set forth in Section 5.02(c) of the Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the Master
Servicer and the Trustee with the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
A-7-3
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
The Depositor, the Master Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Master Servicer, the Trustee or
the Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Master Servicer, the Trustee, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by the Trustee and required to be paid to them pursuant to the Agreement
following the earlier of (i) the final payment or other liquidation (or any
advance with respect thereto) of the last Mortgage Loan remaining in REMIC I,
and (ii) the purchase by the party designated in the Agreement at a price
determined as provided in the Agreement from REMIC I of all the Mortgage Loans
and all property acquired in respect of such Mortgage Loans. The Agreement
permits, but does not require, the party designated in the Agreement to purchase
from REMIC I all the Mortgage Loans and all property acquired in respect of any
Mortgage Loan at a price determined as provided in the Agreement. The exercise
of such right will effect early retirement of the Certificates; however, such
right to purchase is subject to the aggregate Stated Principal Balance of the
Mortgage Loans at the time of purchase being less than 10% of the sum of the
aggregate Stated Principal Balance of the Initial Mortgage Loans at the Cut- off
Date.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-7-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: May __, 2004
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Trustee
By:_______________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Certificate Registrar
By:________________________________
Authorized Signatory
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
----------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts to
Minors Act
JT TEN - as joint tenants with right if
survivorship and not as tenants ----------------------
in common (State)
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to____% evidenced by the within Asset-Backed Pass-
Through Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:__________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
A-7-6
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to__________________________________________________
________________________________ for the account of _________________________,
account number______________ or, if mailed by check, to ________________________
_______________________________________________________________________________.
Applicable statements should be mailed to ______________________________________
________________________________________________________________________________
_______________________________________________________________________________.
This information is provided by ____________________________________, the
assignee named above, or ____________________________________, as its agent.
X-0-0
XXXXXXX X-0
FORM OF CLASS M-3 CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE
INTERNAL REVENUE CODE OF 1986 (THE "CODE").
THIS CERTIFICATE IS SUBORDINATE TO EACH CLASS OF CLASS A CERTIFICATES, THE
CLASS M-1 CERTIFICATES AND THE CLASS M-2 CERTIFICATES TO THE EXTENT
DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
Series 2004-W7, Class M-3 Aggregate Certificate Principal
Balance of the Class M-3 Certificates
as of the Issue Date:
Pass-Through Rate: Variable $ 20,000,000.00
Date of Pooling and Servicing Agreement Denomination: $ 20,000,000.00
and Cut-off Date: May 1, 2004
Master Servicer: Ameriquest Mortgage
First Distribution Date: June 25, 2004 Company
Trustee: Deutsche Bank National Trust
Company
No. 1
Issue Date: May 4, 2004
CUSIP: 040104 JD 4
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ABOVE AS THE DENOMINATION OF THIS CERTIFICATE.
ANY TRANSFEREE OF THIS CERTIFICATE SHALL BE DEEMED TO MAKE THE
REPRESENTATIONS SET FORTH IN SECTION 5.02(c) OF THE AGREEMENT.
A-8-1
ASSET-BACKED PASS-THROUGH CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional one- to four-family
adjustable-rate and fixed-rate first lien mortgage loans (the "Mortgage Loans")
formed and sold by
ARGENT SECURITIES INC.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ARGENT
SECURITIES INC., THE MASTER SERVICER, THE TRUSTEE OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING
MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES.
This certifies that Cede & Co. is the registered owner of a
Percentage Interest (obtained by dividing the denomination of this Certificate
by the aggregate Certificate Principal Balance of the Class M-3 Certificates as
of the Issue Date) in that certain beneficial ownership interest evidenced by
all the Class M-3 Certificates in a REMIC created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Argent
Securities Inc. (hereinafter called the "Depositor," which term includes any
successor entity under the Agreement), the Master Servicer and the Trustee, a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, the capitalized terms used herein have the
meanings assigned in the Agreement. This Certificate is issued under and is
subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of the acceptance hereof
assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
First Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class M-3 Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date or otherwise by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register. Notwithstanding the above, the final distribution on
this Certificate will be made after due notice by the Trustee of the pendency of
such distribution and only upon presentation and surrender of this Certificate
at the office or agency appointed by the Trustee for that purpose as provided in
the Agreement.
A-8-2
The Pass-Through Rate applicable to the calculation of interest
payable with respect to this Certificate on any Distribution Date shall be the
lesser of (x) the related Formula Rate for such Distribution Date and (y) the
Net WAC Pass-Through Rate for such Distribution Date. For any Distribution Date
and this Certificate, the Formula Rate is the lesser of (a) One-Month LIBOR plus
the Certificate Margin and (b) the Maximum Cap Rate. The Certificate Margin with
respect to this Certificate is 0.720% each Distribution Date through and
including the Optional Termination Date and 1.080% thereafter.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset- Backed Pass-Through Certificates of the Series specified on
the face hereof (herein called the "Certificates") and representing a Percentage
Interest in the Class of Certificates specified on the face hereof equal to the
denomination specified on the face hereof divided by the aggregate Certificate
Principal Balance of the Class of Certificates specified on the face hereof.
The Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
Any transferee of this Certificate shall be deemed to make the
representations set forth in Section 5.02(c) of the Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the Master
Servicer and the Trustee with the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
A-8-3
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
The Depositor, the Master Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Master Servicer, the Trustee or
the Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Master Servicer, the Trustee, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by the Trustee and required to be paid to them pursuant to the Agreement
following the earlier of (i) the final payment or other liquidation (or any
advance with respect thereto) of the last Mortgage Loan remaining in REMIC I,
and (ii) the purchase by the party designated in the Agreement at a price
determined as provided in the Agreement from REMIC I of all the Mortgage Loans
and all property acquired in respect of such Mortgage Loans. The Agreement
permits, but does not require, the party designated in the Agreement to purchase
from REMIC I all the Mortgage Loans and all property acquired in respect of any
Mortgage Loan at a price determined as provided in the Agreement. The exercise
of such right will effect early retirement of the Certificates; however, such
right to purchase is subject to the aggregate Stated Principal Balance of the
Mortgage Loans at the time of purchase being less than 10% of the sum of the
aggregate Stated Principal Balance of the Initial Mortgage Loans at the Cut- off
Date.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-8-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: May __, 2004
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Trustee
By:_________________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Certificate Registrar
By:_________________________________
Authorized Signatory
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
----------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts to
Minors Act
JT TEN - as joint tenants with right if
survivorship and not as tenants ----------------------
in common (State)
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to____% evidenced by the within Asset-Backed Pass-
Through Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:__________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
A-8-6
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________ for the account of __________________________,
account number______________ or, if mailed by check, to ________________________
_______________________________________________________________________________.
Applicable statements should be mailed to ______________________________________
________________________________________________________________________________
_______________________________________________________________________________.
This information is provided by ________________________________________,
the assignee named above, or ____________________________________, as its agent.
X-0-0
XXXXXXX X-0
FORM OF CLASS M-4 CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE
INTERNAL REVENUE CODE OF 1986 (THE "CODE").
THIS CERTIFICATE IS SUBORDINATE TO EACH CLASS OF CLASS A CERTIFICATES, THE
CLASS M-1 CERTIFICATES, THE CLASS M-2 CERTIFICATES AND THE CLASS M-3
CERTIFICATES TO THE EXTENT DESCRIBED IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN.
Series 2004-W7, Class M-4 Aggregate Certificate Principal
Balance of the Class M-4 Certificates
as of the Issue Date:
Pass-Through Rate: Variable $ 10,000,000.00
Date of Pooling and Servicing Agreement Denomination: $ 10,000,000.00
and Cut-off Date: May 1, 2004
Master Servicer: Ameriquest Mortgage
First Distribution Date: June 25, 2004 Company
No. 1 Trustee: Deutsche Bank National Trust
Company
Issue Date: May 4, 2004
CUSIP: 040104 JE 2
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ABOVE AS THE DENOMINATION OF THIS CERTIFICATE.
ANY TRANSFEREE OF THIS CERTIFICATE SHALL BE DEEMED TO MAKE THE
REPRESENTATIONS SET FORTH IN SECTION 5.02(c) OF THE AGREEMENT.
A-9-1
ASSET-BACKED PASS-THROUGH CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional one- to four-family
adjustable-rate and fixed-rate first lien mortgage loans (the "Mortgage Loans")
formed and sold by
ARGENT SECURITIES INC.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ARGENT
SECURITIES INC., THE MASTER SERVICER, THE TRUSTEE OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING
MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES.
This certifies that Cede & Co. is the registered owner of a
Percentage Interest (obtained by dividing the denomination of this Certificate
by the aggregate Certificate Principal Balance of the Class M-4 Certificates as
of the Issue Date) in that certain beneficial ownership interest evidenced by
all the Class M-4 Certificates in a REMIC created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Argent
Securities Inc. (hereinafter called the "Depositor," which term includes any
successor entity under the Agreement), the Master Servicer and the Trustee, a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, the capitalized terms used herein have the
meanings assigned in the Agreement. This Certificate is issued under and is
subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of the acceptance hereof
assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
First Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class M-4 Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date or otherwise by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register. Notwithstanding the above, the final distribution on
this Certificate will be made after due notice by the Trustee of the pendency of
such distribution and only upon presentation and surrender of this Certificate
at the office or agency appointed by the Trustee for that purpose as provided in
the Agreement.
A-9-2
The Pass-Through Rate applicable to the calculation of interest
payable with respect to this Certificate on any Distribution Date shall be the
lesser of (x) the related Formula Rate for such Distribution Date and (y) the
Net WAC Pass-Through Rate for such Distribution Date. For any Distribution Date
and this Certificate, the Formula Rate is the lesser of (a) One-Month LIBOR plus
the Certificate Margin and (b) the Maximum Cap Rate. The Certificate Margin with
respect to this Certificate is 1.200% each Distribution Date through and
including the Optional Termination Date and 1.800% thereafter.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset- Backed Pass-Through Certificates of the Series specified on
the face hereof (herein called the "Certificates") and representing a Percentage
Interest in the Class of Certificates specified on the face hereof equal to the
denomination specified on the face hereof divided by the aggregate Certificate
Principal Balance of the Class of Certificates specified on the face hereof.
The Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
Any transferee of this Certificate shall be deemed to make the
representations set forth in Section 5.02(c) of the Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the Master
Servicer and the Trustee with the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
A-9-3
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
The Depositor, the Master Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Master Servicer, the Trustee or
the Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Master Servicer, the Trustee, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by the Trustee and required to be paid to them pursuant to the Agreement
following the earlier of (i) the final payment or other liquidation (or any
advance with respect thereto) of the last Mortgage Loan remaining in REMIC I,
and (ii) the purchase by the party designated in the Agreement at a price
determined as provided in the Agreement from REMIC I of all the Mortgage Loans
and all property acquired in respect of such Mortgage Loans. The Agreement
permits, but does not require, the party designated in the Agreement to purchase
from REMIC I all the Mortgage Loans and all property acquired in respect of any
Mortgage Loan at a price determined as provided in the Agreement. The exercise
of such right will effect early retirement of the Certificates; however, such
right to purchase is subject to the aggregate Stated Principal Balance of the
Mortgage Loans at the time of purchase being less than 10% of the sum of the
aggregate Stated Principal Balance of the Initial Mortgage Loans at the Cut- off
Date.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-9-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: May __, 2004
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Trustee
By:_______________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Certificate Registrar
By:_______________________________
Authorized Signatory
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
----------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts to
Minors Act
JT TEN - as joint tenants with right if
survivorship and not as tenants ----------------------
in common (State)
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to____% evidenced by the within Asset-Backed Pass-
Through Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:__________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
A-9-6
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________ for the account of ___________________________,
account number______________ or, if mailed by check, to ________________________
_______________________________________________________________________________.
Applicable statements should be mailed to_______________________________________
________________________________________________________________________________
_______________________________________________________________________________.
This information is provided by _____________________________________, the
assignee named above, or ____________________________________, as its agent.
X-0-0
XXXXXXX X-00
CLASS OF CLASS M-5 CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE
INTERNAL REVENUE CODE OF 1986 (THE "CODE").
THIS CERTIFICATE IS SUBORDINATE TO EACH CLASS OF CLASS A CERTIFICATES, THE
CLASS M-1 CERTIFICATES, THE CLASS M-2 CERTIFICATES, THE CLASS M-3
CERTIFICATES AND THE CLASS M-4 CERTIFICATES TO THE EXTENT DESCRIBED IN THE
POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
Series 2004-W7, Class M-5 Aggregate Certificate Principal
Balance of the Class M-5 Certificates
as of the Issue Date:
Pass-Through Rate: Variable $ 28,000,000.00
Date of Pooling and Servicing Agreement Denomination: $ 28,000,000.00
and Cut-off Date: May 1, 2004
Master Servicer: Ameriquest Mortgage
First Distribution Date: June 25, 2004 Company
No. 1 Trustee: Deutsche Bank National Trust
Company
Issue Date: May 4, 2004
CUSIP: 040104 JF 9
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ABOVE AS THE DENOMINATION OF THIS CERTIFICATE.
ANY TRANSFEREE OF THIS CERTIFICATE SHALL BE DEEMED TO MAKE THE
REPRESENTATIONS SET FORTH IN SECTION 5.02(c) OF THE AGREEMENT.
A-10-1
ASSET-BACKED PASS-THROUGH CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional one- to four-family
adjustable-rate and fixed-rate first lien mortgage loans (the "Mortgage Loans")
formed and sold by
ARGENT SECURITIES INC.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ARGENT
SECURITIES INC., THE MASTER SERVICER, THE TRUSTEE OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING
MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES.
This certifies that Cede & Co. is the registered owner of a
Percentage Interest (obtained by dividing the denomination of this Certificate
by the aggregate Certificate Principal Balance of the Class M-5 Certificates as
of the Issue Date) in that certain beneficial ownership interest evidenced by
all the Class M-5 Certificates in a REMIC created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Argent
Securities Inc. (hereinafter called the "Depositor," which term includes any
successor entity under the Agreement), the Master Servicer and the Trustee, a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, the capitalized terms used herein have the
meanings assigned in the Agreement. This Certificate is issued under and is
subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of the acceptance hereof
assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
First Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class M-5 Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date or otherwise by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register. Notwithstanding the above, the final distribution on
this Certificate will be made after due notice by the Trustee of the pendency of
such distribution and only upon presentation and surrender of this Certificate
at the office or agency appointed by the Trustee for that purpose as provided in
the Agreement.
The Pass-Through Rate applicable to the calculation of interest
payable with respect to this Certificate on any Distribution Date shall be the
lesser of (x) the related Formula Rate for such
A-10-2
Distribution Date and (y) the Net WAC Pass-Through Rate for such Distribution
Date. For any Distribution Date and this Certificate, the Formula Rate is the
lesser of (a) One-Month LIBOR plus the Certificate Margin and (b) the Maximum
Cap Rate. The Certificate Margin with respect to this Certificate is 1.350% on
each Distribution Date through and including the Optional Termination Date and
2.025% thereafter.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset- Backed Pass-Through Certificates of the Series specified on
the face hereof (herein called the "Certificates") and representing a Percentage
Interest in the Class of Certificates specified on the face hereof equal to the
denomination specified on the face hereof divided by the aggregate Certificate
Principal Balance of the Class of Certificates specified on the face hereof.
The Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
Any transferee of this Certificate shall be deemed to make the
representations set forth in Section 5.02(c) of the Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the Master
Servicer and the Trustee with the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
A-10-3
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
The Depositor, the Master Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Master Servicer, the Trustee or
the Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Master Servicer, the Trustee, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by the Trustee and required to be paid to them pursuant to the Agreement
following the earlier of (i) the final payment or other liquidation (or any
advance with respect thereto) of the last Mortgage Loan remaining in REMIC I,
and (ii) the purchase by the party designated in the Agreement at a price
determined as provided in the Agreement from REMIC I of all the Mortgage Loans
and all property acquired in respect of such Mortgage Loans. The Agreement
permits, but does not require, the party designated in the Agreement to purchase
from REMIC I all the Mortgage Loans and all property acquired in respect of any
Mortgage Loan at a price determined as provided in the Agreement. The exercise
of such right will effect early retirement of the Certificates; however, such
right to purchase is subject to the aggregate Stated Principal Balance of the
Mortgage Loans at the time of purchase being less than 10% of the sum of the
aggregate Stated Principal Balance of the Initial Mortgage Loans at the Cut- off
Date.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-10-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: May __, 2004
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Trustee
By:______________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Certificate Registrar
By:______________________________
Authorized Signatory
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
----------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts to
Minors Act
JT TEN - as joint tenants with right if
survivorship and not as tenants ----------------------
in common (State)
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to____% evidenced by the within Asset-Backed Pass-
Through Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:__________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
A-10-6
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to ________________________________________________
________________________________ for the account of ___________________________,
account number______________ or, if mailed by check, to ________________________
_______________________________________________________________________________.
Applicable statements should be mailed to ______________________________________
________________________________________________________________________________
_______________________________________________________________________________.
This information is provided by ________________________________________,
the assignee named above, or ____________________________________, as its agent.
A-10-7
EXHIBIT A-11
FORM OF CLASS M-6 CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE
INTERNAL REVENUE CODE OF 1986 (THE "CODE").
THIS CERTIFICATE IS SUBORDINATE TO EACH CLASS OF CLASS A CERTIFICATES, THE
CLASS M-1 CERTIFICATES, THE CLASS M-2 CERTIFICATES, THE CLASS M-3
CERTIFICATES, THE CLASS M-4 CERTIFICATES AND THE CLASS M-5 CERTIFICATES TO
THE EXTENT DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN.
Series 2004-W7, Class M-6 Aggregate Certificate Principal
Balance of the Class M-6 Certificates
as of the Issue Date:
Pass-Through Rate: Variable $ 12,500,000.00
Date of Pooling and Servicing Agreement Denomination: $ 12,500,000.00
and Cut-off Date: May 1, 2004
Master Servicer: Ameriquest Mortgage
First Distribution Date: June 25, 2004 Company
No. 1 Trustee: Deutsche Bank National Trust
Company
Issue Date: May 4, 2004
CUSIP: 040104 JG 7
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ABOVE AS THE DENOMINATION OF THIS CERTIFICATE.
ANY TRANSFEREE OF THIS CERTIFICATE SHALL BE DEEMED TO MAKE THE
REPRESENTATIONS SET FORTH IN SECTION 5.02(c) OF THE AGREEMENT.
A-11-1
ASSET-BACKED PASS-THROUGH CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional one- to four-family
adjustable-rate and fixed-rate first lien mortgage loans (the "Mortgage Loans")
formed and sold by
ARGENT SECURITIES INC.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ARGENT
SECURITIES INC., THE MASTER SERVICER, THE TRUSTEE OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING
MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES.
This certifies that Cede & Co. is the registered owner of a
Percentage Interest (obtained by dividing the denomination of this Certificate
by the aggregate Certificate Principal Balance of the Class M-6 Certificates as
of the Issue Date) in that certain beneficial ownership interest evidenced by
all the Class M-6 Certificates in a REMIC created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Argent
Securities Inc. (hereinafter called the "Depositor," which term includes any
successor entity under the Agreement), the Master Servicer and the Trustee, a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, the capitalized terms used herein have the
meanings assigned in the Agreement. This Certificate is issued under and is
subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of the acceptance hereof
assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
First Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class M-6 Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date or otherwise by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register. Notwithstanding the above, the final distribution on
this Certificate will be made after due notice by the Trustee of the pendency of
such distribution and only upon presentation and surrender of this Certificate
at the office or agency appointed by the Trustee for that purpose as provided in
the Agreement.
The Pass-Through Rate applicable to the calculation of interest
payable with respect to this Certificate on any Distribution Date shall be the
lesser of (x) the related Formula Rate for such
A-11-2
Distribution Date and (y) the Net WAC Pass-Through Rate for such Distribution
Date. For any Distribution Date and this Certificate, the Formula Rate is the
lesser of (a) One-Month LIBOR plus the Certificate Margin and (b) the Maximum
Cap Rate. The Certificate Margin with respect to this Certificate is 1.600% on
each Distribution Date through and including the Optional Termination Date and
2.400% thereafter.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset- Backed Pass-Through Certificates of the Series specified on
the face hereof (herein called the "Certificates") and representing a Percentage
Interest in the Class of Certificates specified on the face hereof equal to the
denomination specified on the face hereof divided by the aggregate Certificate
Principal Balance of the Class of Certificates specified on the face hereof.
The Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
Any transferee of this Certificate shall be deemed to make the
representations set forth in Section 5.02(c) of the Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the Master
Servicer and the Trustee with the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
A-11-3
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
The Depositor, the Master Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Master Servicer, the Trustee or
the Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Master Servicer, the Trustee, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by the Trustee and required to be paid to them pursuant to the Agreement
following the earlier of (i) the final payment or other liquidation (or any
advance with respect thereto) of the last Mortgage Loan remaining in REMIC I,
and (ii) the purchase by the party designated in the Agreement at a price
determined as provided in the Agreement from REMIC I of all the Mortgage Loans
and all property acquired in respect of such Mortgage Loans. The Agreement
permits, but does not require, the party designated in the Agreement to purchase
from REMIC I all the Mortgage Loans and all property acquired in respect of any
Mortgage Loan at a price determined as provided in the Agreement. The exercise
of such right will effect early retirement of the Certificates; however, such
right to purchase is subject to the aggregate Stated Principal Balance of the
Mortgage Loans at the time of purchase being less than 10% of the sum of the
aggregate Stated Principal Balance of the Initial Mortgage Loans at the Cut- off
Date.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-11-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: May __, 2004
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Trustee
By:____________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Certificate Registrar
By:____________________________
Authorized Signatory
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
----------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts to
Minors Act
JT TEN - as joint tenants with right if
survivorship and not as tenants ----------------------
in common (State)
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to____% evidenced by the within Asset-Backed Pass-
Through Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:__________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
A-11-6
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________ for the account of _________________________,
account number______________ or, if mailed by check, to ________________________
_______________________________________________________________________________.
Applicable statements should be mailed to ______________________________________
________________________________________________________________________________
_______________________________________________________________________________.
This information is provided by ________________________________________,
the assignee named above, or ____________________________________, as its agent.
A-11-7
EXHIBIT A-12
FORM OF CLASS M-7 CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE").
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A CERTIFICATES, THE CLASS M-1
CERTIFICATES, THE CLASS M-2 CERTIFICATES, THE CLASS M-3 CERTIFICATES, THE
CLASS M-4 CERTIFICATES, THE CLASS M-5 CERTIFICATES AND THE CLASS M-6
CERTIFICATES TO THE EXTENT DESCRIBED IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE
AND MAY NOT BE RESOLD OR TRANSFERRED UNLESS IT IS REGISTERED PURSUANT TO
SUCH ACT AND LAWS OR IS SOLD OR TRANSFERRED IN TRANSACTIONS THAT ARE
EXEMPT FROM REGISTRATION UNDER SUCH ACT AND UNDER APPLICABLE STATE LAW AND
IS TRANSFERRED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF THE
AGREEMENT.
Series 2004-W7, Class M-7 Aggregate Certificate Principal
Balance of the Class M-7 Certificates
as of the Issue Date:
Pass-Through Rate: Variable $ 11,000,000.00
Date of Pooling and Servicing Agreement Denomination: $ 11,000,000.00
and Cut-off Date: May 1, 2004
Master Servicer: Ameriquest Mortgage
First Distribution Date: June 25, 2004 Company
No. 1 Trustee: Deutsche Bank National Trust
Company
Issue Date: May 4, 2004
CUSIP: 040104 KB 6
A-12-1
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ABOVE AS THE DENOMINATION OF THIS CERTIFICATE.
ANY TRANSFEREE OF THIS CERTIFICATE SHALL BE DEEMED TO MAKE THE
REPRESENTATIONS SET FORTH IN SECTION 5.02(c) OF THE AGREEMENT.
A-12-2
ASSET-BACKED PASS-THROUGH CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional one- to four-family
adjustable-rate and fixed-rate first lien mortgage loans (the "Mortgage Loans")
formed and sold by
ARGENT SECURITIES INC.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ARGENT
SECURITIES INC., THE MASTER SERVICER, THE TRUSTEE OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING
MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES.
This certifies that Cede & Co. is the registered owner of a
Percentage Interest (obtained by dividing the denomination of this Certificate
by the aggregate Certificate Principal Balance of the Class M-7 Certificates as
of the Issue Date) in that certain beneficial ownership interest evidenced by
all the Class M-7 Certificates in a REMIC created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Argent
Securities Inc. (hereinafter called the "Depositor," which term includes any
successor entity under the Agreement), the Master Servicer and the Trustee, a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, the capitalized terms used herein have the
meanings assigned in the Agreement. This Certificate is issued under and is
subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of the acceptance hereof
assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
First Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class M-7 Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date or otherwise by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register. Notwithstanding the above, the final distribution on
this Certificate will be made after due notice by the Trustee of the pendency of
such distribution and only upon presentation and surrender of this Certificate
at the office or agency appointed by the Trustee for that purpose as provided in
the Agreement.
The Pass-Through Rate applicable to the calculation of interest
payable with respect to this Certificate on any Distribution Date shall be the
lesser of (x) the related Formula Rate for such
A-12-3
Distribution Date and (y) the Net WAC Pass-Through Rate for such Distribution
Date. For any Distribution Date and this Certificate, the Formula Rate is
One-Month LIBOR plus the Certificate Margin. The Certificate Margin for this
Certificate is 1.950% in the case of each Distribution Date through and
including the Optional Termination Date, or 2.925%, in the case of any
Distribution Date thereafter.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset- Backed Pass-Through Certificates of the Series specified on
the face hereof (herein called the "Certificates") and representing a Percentage
Interest in the Class of Certificates specified on the face hereof equal to the
denomination specified on the face hereof divided by the aggregate Certificate
Principal Balance of the Class of Certificates specified on the face hereof.
The Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
Any transferee of this Certificate shall be deemed to make the
representations set forth in Section 5.02(c) of the Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the Master
Servicer and the Trustee with the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
A-12-4
No transfer of this Certificate shall be made unless the transfer is
made pursuant to an effective registration statement under the Securities Act of
1933, as amended (the "1933 Act"), and an effective registration or
qualification under applicable state securities laws, or is made in a
transaction that does not require such registration or qualification. In the
event that such a transfer of this Certificate is to be made without
registration or qualification, the Trustee and the Certificate Registrar shall
require receipt of (i) if such transfer is purportedly being made in reliance
upon Rule 144A under the 1933 Act, written certifications from the Holder of the
Certificate desiring to effect the transfer, and from such Holder's prospective
transferee, substantially in the forms attached to the Agreement as Exhibit F-1,
and (ii) in all other cases, an Opinion of Counsel satisfactory to it that such
transfer may be made without such registration or qualification (which Opinion
of Counsel shall not be an expense of the Trust Fund or of the Depositor, the
Trustee or the Master Servicer in their respective capacities as such), together
with copies of the written certification(s) of the Holder of the Certificate
desiring to effect the transfer and/or such Holder's prospective transferee upon
which such Opinion of Counsel is based. None of the Depositor, the Certificate
Registrar or the Trustee is obligated to register or qualify the Class of
Certificates specified on the face hereof under the 1933 Act or any other
securities law or to take any action not otherwise required under the Agreement
to permit the transfer of such Certificates without registration or
qualification. Any Holder desiring to effect a transfer of this Certificate
shall be required to indemnify the Trustee, the Depositor, the Certificate
Registrar and the Master Servicer against any liability that may result if the
transfer is not so exempt or is not made in accordance with such federal and
state laws.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
The Depositor, the Master Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Master Servicer, the Trustee or
the Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Master Servicer, the Trustee, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by the Trustee and required to be paid to them pursuant to the Agreement
following the earlier of (i) the final payment or other liquidation (or any
advance with respect thereto) of the last Mortgage Loan remaining in REMIC I,
and (ii) the purchase by the party designated in the Agreement at a price
determined as provided in the Agreement from REMIC I of all the Mortgage Loans
and all property acquired in respect of such Mortgage Loans. The Agreement
permits, but does not require, the party designated in the Agreement to purchase
from REMIC I all the Mortgage Loans and all property acquired in respect of any
Mortgage Loan at a price determined as provided in the Agreement. The exercise
of such right will effect early retirement of the Certificates; however, such
right cannot be exercised until the Optional Termination Date.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-12-6
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: May ___, 2004
DEUTSCHE BANK NATIONAL
TRUST COMPANY
as Trustee
By:_______________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
DEUTSCHE BANK NATIONAL
TRUST COMPANY
as Certificate Registrar
By:_______________________________
Authorized Signatory
A-12-7
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
----------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts to
Minors Act
JT TEN - as joint tenants with right if
survivorship and not as tenants ----------------------
in common (State)
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to____% evidenced by the within Asset-Backed Pass-
Through Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:__________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
A-12-8
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________ for the account of ___________________________,
account number______________ or, if mailed by check, to ________________________
_______________________________________________________________________________.
Applicable statements should be mailed to ______________________________________
________________________________________________________________________________
_______________________________________________________________________________.
This information is provided by _________________________________________,
the assignee named above, or ____________________________________, as its agent.
A-12-9
EXHIBIT A-13
FORM OF CLASS M-8 CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE
INTERNAL REVENUE CODE OF 1986 (THE "CODE").
THIS CERTIFICATE IS SUBORDINATE TO EACH CLASS OF CLASS A CERTIFICATES, THE
CLASS M-1 CERTIFICATES, THE CLASS M-2 CERTIFICATES, THE CLASS M-3
CERTIFICATES, THE CLASS M-4 CERTIFICATES, THE CLASS M-5 CERTIFICATES, THE
CLASS M-6 CERTIFICATES AND THE CLASS M-7 CERTIFICATES TO THE EXTENT
DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
Series 2004-W7, Class M-8 Aggregate Certificate Principal
Balance of the Class M-8 Certificates
as of the Issue Date:
Pass-Through Rate: Variable $ 10,000,000.00
Date of Pooling and Servicing Agreement Denomination: $ 10,000,000.00
and Cut-off Date: May 1, 2004
Master Servicer: Ameriquest Mortgage
First Distribution Date: June 25, 2004 Company
No. 1 Trustee: Deutsche Bank National Trust
Company
Issue Date: May 4, 2004
CUSIP: 040104 KC 4
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ABOVE AS THE DENOMINATION OF THIS CERTIFICATE.
ANY TRANSFEREE OF THIS CERTIFICATE SHALL BE DEEMED TO MAKE THE
REPRESENTATIONS SET FORTH IN SECTION 5.02(c) OF THE AGREEMENT.
A-13-1
ASSET-BACKED PASS-THROUGH CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional one- to four-family
adjustable-rate and fixed-rate first lien mortgage loans (the "Mortgage Loans")
formed and sold by
ARGENT SECURITIES INC.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ARGENT
SECURITIES INC., THE MASTER SERVICER, THE TRUSTEE OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING
MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES.
This certifies that Cede & Co. is the registered owner of a
Percentage Interest (obtained by dividing the denomination of this Certificate
by the aggregate Certificate Principal Balance of the Class M-8 Certificates as
of the Issue Date) in that certain beneficial ownership interest evidenced by
all the Class M-8 Certificates in a REMIC created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Argent
Securities Inc. (hereinafter called the "Depositor," which term includes any
successor entity under the Agreement), the Master Servicer and the Trustee, a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, the capitalized terms used herein have the
meanings assigned in the Agreement. This Certificate is issued under and is
subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of the acceptance hereof
assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
First Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class M-8 Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date or otherwise by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register. Notwithstanding the above, the final distribution on
this Certificate will be made after due notice by the Trustee of the pendency of
such distribution and only upon presentation and surrender of this Certificate
at the office or agency appointed by the Trustee for that purpose as provided in
the Agreement.
The Pass-Through Rate applicable to the calculation of interest
payable with respect to this Certificate on any Distribution Date shall be the
lesser of (x) the related Formula Rate for such
A-13-2
Distribution Date and (y) the Net WAC Pass-Through Rate for such Distribution
Date. For any Distribution Date and this Certificate, the Formula Rate is the
lesser of (a) One-Month LIBOR plus the Certificate Margin and (b) the Maximum
Cap Rate. The Certificate Margin with respect to this Certificate is 2.250% on
each Distribution Date through and including the Optional Termination Date and
3.375% thereafter.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset- Backed Pass-Through Certificates of the Series specified on
the face hereof (herein called the "Certificates") and representing a Percentage
Interest in the Class of Certificates specified on the face hereof equal to the
denomination specified on the face hereof divided by the aggregate Certificate
Principal Balance of the Class of Certificates specified on the face hereof.
The Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
Any transferee of this Certificate shall be deemed to make the
representations set forth in Section 5.02(c) of the Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the Master
Servicer and the Trustee with the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
A-13-3
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
The Depositor, the Master Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Master Servicer, the Trustee or
the Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Master Servicer, the Trustee, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by the Trustee and required to be paid to them pursuant to the Agreement
following the earlier of (i) the final payment or other liquidation (or any
advance with respect thereto) of the last Mortgage Loan remaining in REMIC I,
and (ii) the purchase by the party designated in the Agreement at a price
determined as provided in the Agreement from REMIC I of all the Mortgage Loans
and all property acquired in respect of such Mortgage Loans. The Agreement
permits, but does not require, the party designated in the Agreement to purchase
from REMIC I all the Mortgage Loans and all property acquired in respect of any
Mortgage Loan at a price determined as provided in the Agreement. The exercise
of such right will effect early retirement of the Certificates; however, such
right to purchase is subject to the aggregate Stated Principal Balance of the
Mortgage Loans at the time of purchase being less than 10% of the sum of the
aggregate Stated Principal Balance of the Initial Mortgage Loans at the Cut- off
Date.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-13-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: May __, 2004
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Trustee
By:_____________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Certificate Registrar
By:_____________________________
Authorized Signatory
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
----------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts to
Minors Act
JT TEN - as joint tenants with right if
survivorship and not as tenants ----------------------
in common (State)
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to____% evidenced by the within Asset-Backed Pass-
Through Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:__________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
A-13-6
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________ for the account of ________________________,
account number______________ or, if mailed by check, to ________________________
_______________________________________________________________________________.
Applicable statements should be mailed to_______________________________________
________________________________________________________________________________
_______________________________________________________________________________.
This information is provided by _____________________________________, the
assignee named above, or ____________________________________, as its agent.
A-13-7
EXHIBIT A-14
FORM OF CLASS M-9 CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE
INTERNAL REVENUE CODE OF 1986 (THE "CODE").
THIS CERTIFICATE IS SUBORDINATE TO EACH CLASS OF CLASS A CERTIFICATES, THE
CLASS M-1 CERTIFICATES, THE CLASS M-2 CERTIFICATES, THE CLASS M-3
CERTIFICATES, THE CLASS M-4 CERTIFICATES, THE CLASS M-5 CERTIFICATES, THE
CLASS M-6 CERTIFICATES, THE CLASS M-7 CERTIFICATES AND THE CLASS M-8
CERTIFICATES TO THE EXTENT DESCRIBED IN THE POOLING AND SERVICING
AGREEMENT REFERRED TO HEREIN.
Series 2004-W7, Class M-9 Aggregate Certificate Principal
Balance of the Class M-9 Certificates
as of the Issue Date:
Pass-Through Rate: Variable $ 12,000,000.00
Date of Pooling and Servicing Agreement Denomination: $ 12,000,000.00
and Cut-off Date: May 1, 2004
Master Servicer: Ameriquest Mortgage
First Distribution Date: June 25, 2004 Company
No. 1 Trustee: Deutsche Bank National Trust
Company
Issue Date: May 4, 2004
CUSIP: 040104 KD 2
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ABOVE AS THE DENOMINATION OF THIS CERTIFICATE.
ANY TRANSFEREE OF THIS CERTIFICATE SHALL BE DEEMED TO MAKE THE
REPRESENTATIONS SET FORTH IN SECTION 5.02(c) OF THE AGREEMENT.
A-14-1
ASSET-BACKED PASS-THROUGH CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional one- to four-family
adjustable-rate and fixed-rate first lien mortgage loans (the "Mortgage Loans")
formed and sold by
ARGENT SECURITIES INC.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ARGENT
SECURITIES INC., THE MASTER SERVICER, THE TRUSTEE OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING
MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES.
This certifies that Cede & Co. is the registered owner of a
Percentage Interest (obtained by dividing the denomination of this Certificate
by the aggregate Certificate Principal Balance of the Class M-9 Certificates as
of the Issue Date) in that certain beneficial ownership interest evidenced by
all the Class M-9 Certificates in a REMIC created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Argent
Securities Inc. (hereinafter called the "Depositor," which term includes any
successor entity under the Agreement), the Master Servicer and the Trustee, a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, the capitalized terms used herein have the
meanings assigned in the Agreement. This Certificate is issued under and is
subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of the acceptance hereof
assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
First Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class M-9 Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date or otherwise by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register. Notwithstanding the above, the final distribution on
this Certificate will be made after due notice by the Trustee of the pendency of
such distribution and only upon presentation and surrender of this Certificate
at the office or agency appointed by the Trustee for that purpose as provided in
the Agreement.
The Pass-Through Rate applicable to the calculation of interest
payable with respect to this Certificate on any Distribution Date shall be the
lesser of (x) the related Formula Rate for such
A-14-2
Distribution Date and (y) the Net WAC Pass-Through Rate for such Distribution
Date. For any Distribution Date and this Certificate, the Formula Rate is the
lesser of (a) One-Month LIBOR plus the Certificate Margin and (b) the Maximum
Cap Rate. The Certificate Margin with respect to this Certificate is 3.200% on
each Distribution Date through and including the Optional Termination Date and
4.800% thereafter.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset- Backed Pass-Through Certificates of the Series specified on
the face hereof (herein called the "Certificates") and representing a Percentage
Interest in the Class of Certificates specified on the face hereof equal to the
denomination specified on the face hereof divided by the aggregate Certificate
Principal Balance of the Class of Certificates specified on the face hereof.
The Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
Any transferee of this Certificate shall be deemed to make the
representations set forth in Section 5.02(c) of the Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the Master
Servicer and the Trustee with the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
A-14-3
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
The Depositor, the Master Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Master Servicer, the Trustee or
the Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Master Servicer, the Trustee, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by the Trustee and required to be paid to them pursuant to the Agreement
following the earlier of (i) the final payment or other liquidation (or any
advance with respect thereto) of the last Mortgage Loan remaining in REMIC I,
and (ii) the purchase by the party designated in the Agreement at a price
determined as provided in the Agreement from REMIC I of all the Mortgage Loans
and all property acquired in respect of such Mortgage Loans. The Agreement
permits, but does not require, the party designated in the Agreement to purchase
from REMIC I all the Mortgage Loans and all property acquired in respect of any
Mortgage Loan at a price determined as provided in the Agreement. The exercise
of such right will effect early retirement of the Certificates; however, such
right to purchase is subject to the aggregate Stated Principal Balance of the
Mortgage Loans at the time of purchase being less than 10% of the sum of the
aggregate Stated Principal Balance of the Initial Mortgage Loans at the Cut- off
Date.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-14-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: May __, 2004
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Trustee
By:______________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Certificate Registrar
By:______________________________
Authorized Signatory
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
----------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts to
Minors Act
JT TEN - as joint tenants with right if
survivorship and not as tenants ----------------------
in common (State)
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to____% evidenced by the within Asset-Backed Pass-
Through Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:__________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
A-14-6
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________ for the account of ___________________________,
account number______________ or, if mailed by check, to ________________________
_______________________________________________________________________________.
Applicable statements should be mailed to ______________________________________
________________________________________________________________________________
_______________________________________________________________________________.
This information is provided by _______________________________________,
the assignee named above, or ____________________________________, as its agent.
A-14-7
EXHIBIT A-15
FORM OF CLASS M-10 CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE
INTERNAL REVENUE CODE OF 1986 (THE "CODE").
THIS CERTIFICATE IS SUBORDINATE TO EACH CLASS OF CLASS A CERTIFICATES, THE
CLASS M-1 CERTIFICATES, THE CLASS M-2 CERTIFICATES, THE CLASS M-3
CERTIFICATES, THE CLASS M-4 CERTIFICATES, THE CLASS M-5 CERTIFICATES, THE
CLASS M-6 CERTIFICATES, THE CLASS M-7 CERTIFICATES, THE CLASS M-8
CERTIFICATES AND THE CLASS M-9 CERTIFICATES TO THE EXTENT DESCRIBED IN THE
POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
Series 2004-W7, Class M-10 Aggregate Certificate Principal
Balance of the Class M-10
Certificates as of the Issue Date:
Pass-Through Rate: Variable $ 14,500,000.00
Date of Pooling and Servicing Agreement Denomination: $ 14,500,000.00
and Cut-off Date: May 1, 2004
Master Servicer: Ameriquest Mortgage
First Distribution Date: June 25, 2004 Company
No. 1 Trustee: Deutsche Bank National Trust
Company
Issue Date: May 4, 2004
CUSIP: 040104 KE 0
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ABOVE AS THE DENOMINATION OF THIS CERTIFICATE.
ANY TRANSFEREE OF THIS CERTIFICATE SHALL BE DEEMED TO MAKE THE
REPRESENTATIONS SET FORTH IN SECTION 5.02(c) OF THE AGREEMENT.
A-15-1
ASSET-BACKED PASS-THROUGH CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional one- to four-family
adjustable-rate and fixed-rate first lien mortgage loans (the "Mortgage Loans")
formed and sold by
ARGENT SECURITIES INC.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ARGENT
SECURITIES INC., THE MASTER SERVICER, THE TRUSTEE OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING
MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES.
This certifies that Cede & Co. is the registered owner of a
Percentage Interest (obtained by dividing the denomination of this Certificate
by the aggregate Certificate Principal Balance of the Class M-10 Certificates as
of the Issue Date) in that certain beneficial ownership interest evidenced by
all the Class M-10 Certificates in a REMIC created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Argent
Securities Inc. (hereinafter called the "Depositor," which term includes any
successor entity under the Agreement), the Master Servicer and the Trustee, a
summary of certain of the pertinent provisions of which is set forth hereafter.
To the extent not defined herein, the capitalized terms used herein have the
meanings assigned in the Agreement. This Certificate is issued under and is
subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of the acceptance hereof
assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
First Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class M-10 Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date or otherwise by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register. Notwithstanding the above, the final distribution on
this Certificate will be made after due notice by the Trustee of the pendency of
such distribution and only upon presentation and surrender of this Certificate
at the office or agency appointed by the Trustee for that purpose as provided in
the Agreement.
The Pass-Through Rate applicable to the calculation of interest
payable with respect to this Certificate on any Distribution Date shall be the
lesser of (x) the related Formula Rate for such
A-15-2
Distribution Date and (y) the Net WAC Pass-Through Rate for such Distribution
Date. For any Distribution Date and this Certificate, the Formula Rate is the
lesser of (a) One-Month LIBOR plus the Certificate Margin and (b) the Maximum
Cap Rate. The Certificate Margin with respect to this Certificate is 2.500% on
each Distribution Date through and including the Optional Termination Date and
3.750% thereafter.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset- Backed Pass-Through Certificates of the Series specified on
the face hereof (herein called the "Certificates") and representing a Percentage
Interest in the Class of Certificates specified on the face hereof equal to the
denomination specified on the face hereof divided by the aggregate Certificate
Principal Balance of the Class of Certificates specified on the face hereof.
The Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
Any transferee of this Certificate shall be deemed to make the
representations set forth in Section 5.02(c) of the Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the Master
Servicer and the Trustee with the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
A-15-3
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
The Depositor, the Master Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Master Servicer, the Trustee or
the Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Master Servicer, the Trustee, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by the Trustee and required to be paid to them pursuant to the Agreement
following the earlier of (i) the final payment or other liquidation (or any
advance with respect thereto) of the last Mortgage Loan remaining in REMIC I,
and (ii) the purchase by the party designated in the Agreement at a price
determined as provided in the Agreement from REMIC I of all the Mortgage Loans
and all property acquired in respect of such Mortgage Loans. The Agreement
permits, but does not require, the party designated in the Agreement to purchase
from REMIC I all the Mortgage Loans and all property acquired in respect of any
Mortgage Loan at a price determined as provided in the Agreement. The exercise
of such right will effect early retirement of the Certificates; however, such
right to purchase is subject to the aggregate Stated Principal Balance of the
Mortgage Loans at the time of purchase being less than 10% of the sum of the
aggregate Stated Principal Balance of the Initial Mortgage Loans at the Cut- off
Date.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-15-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: May __, 2004
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Trustee
By:_______________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Certificate Registrar
By:_______________________________
Authorized Signatory
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
----------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts to
Minors Act
JT TEN - as joint tenants with right if
survivorship and not as tenants ----------------------
in common (State)
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to____% evidenced by the within Asset-Backed Pass-
Through Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:__________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
A-15-6
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________ for the account of __________________________,
account number______________ or, if mailed by check, to ________________________
_______________________________________________________________________________.
Applicable statements should be mailed to ______________________________________
________________________________________________________________________________
_______________________________________________________________________________.
This information is provided by ____________________________________, the
assignee named above, or ____________________________________, as its agent.
A-15-7
EXHIBIT A-16
FORM OF CLASS CE CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT", AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE
INTERNAL REVENUE CODE OF 1986 (THE "CODE").
THIS CERTIFICATE IS SUBORDINATE TO THE CLASS A CERTIFICATES AND THE
MEZZANINE CERTIFICATES TO THE EXTENT DESCRIBED IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE
AND MAY NOT BE RESOLD OR TRANSFERRED UNLESS IT IS REGISTERED PURSUANT TO
SUCH ACT AND LAWS OR IS SOLD OR TRANSFERRED IN TRANSACTIONS THAT ARE
EXEMPT FROM REGISTRATION UNDER SUCH ACT AND UNDER APPLICABLE STATE LAW AND
IS TRANSFERRED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF THE
AGREEMENT.
NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER
RETIREMENT ARRANGEMENT (EACH A "PLAN") SUBJECT TO THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR THE CODE WILL BE
REGISTERED EXCEPT IN COMPLIANCE WITH THE PROCEDURES DESCRIBED HEREIN.
Series 2004-W7, Class CE Aggregate Notional Amount of the
Class CE Certificates as of the
Issue Date:
Date of Pooling and Servicing Agreement
and Cut-off Date: May 1, 2004 $
Denomination: $
First Distribution Date: June 25, 2004
Master Servicer: Ameriquest Mortgage
No. 1 Company
Issue Date: May 4, 2004 Trustee: Deutsche Bank National Trust
Company
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ABOVE AS THE DENOMINATION OF THIS CERTIFICATE.
A-16-1
ASSET-BACKED PASS-THROUGH CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional one- to four-family
adjustable-rate and fixed-rate first lien mortgage loans (the "Mortgage Loans")
formed and sold by
ARGENT SECURITIES INC.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ARGENT
SECURITIES INC., THE MASTER SERVICER, THE TRUSTEE OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING
MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES.
This certifies that Ameriquest Mortgage Company is the registered
owner of a Percentage Interest (obtained by dividing the denomination of this
Certificate by the aggregate Certificate Principal Balance of the Class CE
Certificates as of the Issue Date) in that certain beneficial ownership interest
evidenced by all the Class CE Certificates in a REMIC created pursuant to a
Pooling and Servicing Agreement, dated as specified above (the "Agreement"),
among Argent Securities Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), the Master Servicer and the
Trustee, a summary of certain of the pertinent provisions of which is set forth
hereafter. To the extent not defined herein, the capitalized terms used herein
have the meanings assigned in the Agreement. This Certificate is issued under
and is subject to the terms, provisions and conditions of the Agreement, to
which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
First Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class CE Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date or otherwise by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register. Notwithstanding the above, the final distribution on
this Certificate will be made after due notice by the Trustee of the pendency of
such distribution and only upon presentation and surrender of this Certificate
at the office or agency appointed by the Trustee for that purpose as provided in
the Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset- Backed Pass-Through Certificates of the Series specified on
the face hereof (herein called the "Certificates") and representing a Percentage
Interest in the Class of Certificates specified on the face
A-16-2
hereof equal to the denomination specified on the face hereof divided by the
aggregate Certificate Principal Balance of the Class of Certificates specified
on the face hereof.
The Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the Master
Servicer and the Trustee with the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No transfer of this Certificate shall be made unless the transfer is
made pursuant to an effective registration statement under the Securities Act of
1933, as amended (the "1933 Act"), and an effective registration or
qualification under applicable state securities laws, or is made in a
transaction that does not require such registration or qualification. In the
event that such a transfer of this Certificate is to be made without
registration or qualification, the Trustee and the Certificate Registrar shall
require receipt of (i) if such transfer is purportedly being made in reliance
upon Rule 144A under the 1933 Act, written certifications from the Holder of the
Certificate desiring to effect the transfer, and from such Holder's prospective
transferee, substantially in the forms attached to the Agreement as Exhibit F-1,
and (ii) in all other cases, an Opinion of Counsel satisfactory to it that such
transfer may be made without such registration or qualification (which Opinion
of Counsel shall not be an expense of the Trust Fund or of the Depositor, the
Trustee or the Master Servicer in their respective capacities as such), together
with copies of the written certification(s) of the Holder of the
A-16-3
Certificate desiring to effect the transfer and/or such Holder's prospective
transferee upon which such Opinion of Counsel is based. None of the Depositor,
the Certificate Registrar or the Trustee is obligated to register or qualify the
Class of Certificates specified on the face hereof under the 1933 Act or any
other securities law or to take any action not otherwise required under the
Agreement to permit the transfer of such Certificates without registration or
qualification. Any Holder desiring to effect a transfer of this Certificate
shall be required to indemnify the Trustee, the Depositor, the Certificate
Registrar and the Master Servicer against any liability that may result if the
transfer is not so exempt or is not made in accordance with such federal and
state laws.
No transfer of this Certificate to a Plan subject to ERISA or
Section 4975 of the Code, any Person acting, directly or indirectly, on behalf
of any such Plan or any Person using "Plan Assets" to acquire this Certificate
shall be made except in accordance with Section 5.02(c) of the Agreement.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
The Depositor, the Master Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Master Servicer, the Trustee or
the Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Master Servicer, the Trustee, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by the Trustee and required to be paid to them pursuant to the Agreement
following the earlier of (i) the final payment or other liquidation (or any
advance with respect thereto) of the last Mortgage Loan remaining in REMIC I,
and (ii) the purchase by the party designated in the Agreement at a price
determined as provided in the Agreement from REMIC I of all the Mortgage Loans
and all property acquired in respect of such Mortgage Loans. The Agreement
permits, but does not require, the party designated in the Agreement to purchase
from REMIC I all the Mortgage Loans and all property acquired in respect of any
Mortgage Loan at a price determined as provided in the Agreement. The exercise
of such right will effect early retirement of the Certificates; however, such
right to purchase is subject to the aggregate Stated Principal Balance of the
Mortgage Loans at the time of purchase being less than 10% of the sum of the
aggregate Stated Principal Balance of the Initial Mortgage Loans at the Cut- off
Date.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-16-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: May __, 2004
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Trustee
By:____________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Certificate Registrar
By:____________________________
Authorized Signatory
A-16-5
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
----------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts to
Minors Act
JT TEN - as joint tenants with right if
survivorship and not as tenants ----------------------
in common (State)
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to____% evidenced by the within Asset-Backed Pass-
Through Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:__________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
A-16-6
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________ for the account of ___________________________,
account number______________ or, if mailed by check, to ________________________
________________________________________________________________________________
Applicable statements should be mailed to ______________________________________
________________________________________________________________________________
_______________________________________________________________________________.
This information is provided by ___________________________________, the
assignee named above, or ____________________________________, as its agent.
A-16-7
EXHIBIT A-17
FORM OF CLASS P CERTIFICATE
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT", AS
THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE
INTERNAL REVENUE CODE OF 1986 (THE "CODE").
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE
AND MAY NOT BE RESOLD OR TRANSFERRED UNLESS IT IS REGISTERED PURSUANT TO
SUCH ACT AND LAWS OR IS SOLD OR TRANSFERRED IN TRANSACTIONS THAT ARE
EXEMPT FROM REGISTRATION UNDER SUCH ACT AND UNDER APPLICABLE STATE LAW AND
IS TRANSFERRED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF THE
AGREEMENT.
NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER
RETIREMENT ARRANGEMENT (EACH A "PLAN") SUBJECT TO THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR THE CODE WILL BE
REGISTERED EXCEPT IN COMPLIANCE WITH THE PROCEDURES DESCRIBED HEREIN.
Series 2004-W7, Class P Aggregate Certificate Principal
Balance of the Class P Certificates
as of the Issue Date:
Date of Pooling and Servicing Agreement $100.00
and Cut-off Date: May 1, 2004
Denomination: $100.00
First Distribution Date: June 25, 2004
No. 1 Master Servicer: Ameriquest Mortgage
Company
Trustee: Deutsche Bank National Trust
Company
Issue Date: May 4, 2004
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS
THAN THE AMOUNT SHOWN ABOVE AS THE DENOMINATION OF THIS CERTIFICATE.
A-17-1
ASSET-BACKED PASS-THROUGH CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional one- to four-family
adjustable-rate and fixed-rate first lien mortgage loans (the "Mortgage Loans")
formed and sold by
ARGENT SECURITIES INC.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ARGENT
SECURITIES INC., THE MASTER SERVICER, THE TRUSTEE OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING
MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES.
This certifies that Ameriquest Mortgage Company is the registered
owner of a Percentage Interest (obtained by dividing the denomination of this
Certificate by the aggregate Certificate Principal Balance of the Class P
Certificates as of the Issue Date) in that certain beneficial ownership interest
evidenced by all the Class P Certificates in a REMIC created pursuant to a
Pooling and Servicing Agreement, dated as specified above (the "Agreement"),
among Argent Securities Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), the Master Servicer and the
Trustee, a summary of certain of the pertinent provisions of which is set forth
hereafter. To the extent not defined herein, the capitalized terms used herein
have the meanings assigned in the Agreement. This Certificate is issued under
and is subject to the terms, provisions and conditions of the Agreement, to
which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
First Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class P Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date or otherwise by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register. Notwithstanding the above, the final distribution on
this Certificate will be made after due notice by the Trustee of the pendency of
such distribution and only upon presentation and surrender of this Certificate
at the office or agency appointed by the Trustee for that purpose as provided in
the Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset- Backed Pass-Through Certificates of the Series specified on
the face hereof (herein called the "Certificates") and representing a Percentage
Interest in the Class of Certificates specified on the face
A-17-2
hereof equal to the denomination specified on the face hereof divided by the
aggregate Certificate Principal Balance of the Class of Certificates specified
on the face hereof.
The Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the Master
Servicer and the Trustee with the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No transfer of this Certificate shall be made unless the transfer is
made pursuant to an effective registration statement under the Securities Act of
1933, as amended (the "1933 Act"), and an effective registration or
qualification under applicable state securities laws, or is made in a
transaction that does not require such registration or qualification. In the
event that such a transfer of this Certificate is to be made without
registration or qualification, the Trustee and the Certificate Registrar shall
require receipt of (i) if such transfer is purportedly being made in reliance
upon Rule 144A under the 1933 Act, written certifications from the Holder of the
Certificate desiring to effect the transfer, and from such Holder's prospective
transferee, substantially in the forms attached to the Agreement as Exhibit F-1,
and (ii) in all other cases, an Opinion of Counsel satisfactory to it that such
transfer may be made without such registration or qualification (which Opinion
of Counsel shall not be an expense of the Trust Fund or of the Depositor, the
Trustee or the Master Servicer in their respective capacities as such), together
with copies of the written certification(s) of the Holder of the
A-17-3
Certificate desiring to effect the transfer and/or such Holder's prospective
transferee upon which such Opinion of Counsel is based. None of the Depositor,
the Certificate Registrar or the Trustee is obligated to register or qualify the
Class of Certificates specified on the face hereof under the 1933 Act or any
other securities law or to take any action not otherwise required under the
Agreement to permit the transfer of such Certificates without registration or
qualification. Any Holder desiring to effect a transfer of this Certificate
shall be required to indemnify the Trustee, the Depositor, the Certificate
Registrar and the Master Servicer against any liability that may result if the
transfer is not so exempt or is not made in accordance with such federal and
state laws.
No transfer of this Certificate to a Plan subject to ERISA or
Section 4975 of the Code, any Person acting, directly or indirectly, on behalf
of any such Plan or any Person using "Plan Assets" to acquire this Certificate
shall be made except in accordance with Section 5.02(c) of the Agreement.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
The Depositor, the Master Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Master Servicer, the Trustee or
the Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Master Servicer, the Trustee, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by the Trustee and required to be paid to them pursuant to the Agreement
following the earlier of (i) the final payment or other liquidation (or any
advance with respect thereto) of the last Mortgage Loan remaining in REMIC I,
and (ii) the purchase by the party designated in the Agreement at a price
determined as provided in the Agreement from REMIC I of all the Mortgage Loans
and all property acquired in respect of such Mortgage Loans. The Agreement
permits, but does not require, the party designated in the Agreement to purchase
from REMIC I all the Mortgage Loans and all property acquired in respect of any
Mortgage Loan at a price determined as provided in the Agreement. The exercise
of such right will effect early retirement of the Certificates; however, such
right to purchase is subject to the aggregate Stated Principal Balance of the
Mortgage Loans at the time of purchase being less than 10% of the sum of the
aggregate Stated Principal Balance of the Initial Mortgage Loans at the Cut- off
Date.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-17-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: May __, 2004
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Trustee
By:______________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Certificate Registrar
By:______________________________
Authorized Signatory
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
----------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts to
Minors Act
JT TEN - as joint tenants with right if
survivorship and not as tenants ----------------------
in common (State)
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to____% evidenced by the within Asset-Backed Pass-
Through Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:__________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
A-17-6
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________ for the account of _________________________,
account number______________ or, if mailed by check, to ________________________
_______________________________________________________________________________.
Applicable statements should be mailed to ______________________________________
________________________________________________________________________________
_______________________________________________________________________________.
This information is provided by _______________________________________,
the assignee named above, or ____________________________________, as its agent.
A-17-7
EXHIBIT A-18
FORM OF CLASS R CERTIFICATE
THIS CERTIFICATE MAY NOT BE TRANSFERRED TO A NON- UNITED STATES PERSON.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"RESIDUAL INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT"
("REMIC"), AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND
860D OF THE INTERNAL REVENUE CODE OF 1986 (THE "CODE").
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE
AND MAY NOT BE RESOLD OR TRANSFERRED UNLESS IT IS REGISTERED PURSUANT TO
SUCH ACT AND LAWS OR IS SOLD OR TRANSFERRED IN TRANSACTIONS THAT ARE
EXEMPT FROM REGISTRATION UNDER SUCH ACT AND UNDER APPLICABLE STATE LAW AND
IS TRANSFERRED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF THE
AGREEMENT.
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE MADE
ONLY IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER
RETIREMENT ARRANGEMENT (EACH A "PLAN") SUBJECT TO THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR THE CODE WILL BE
REGISTERED EXCEPT IN COMPLIANCE WITH THE PROCEDURES DESCRIBED HEREIN.
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE MADE
ONLY IF THE PROPOSED TRANSFEREE PROVIDES (I) AN AFFIDAVIT TO THE TRUSTEE
THAT (A) SUCH TRANSFEREE IS NOT (1) THE UNITED STATES OR ANY POSSESSION
THEREOF, ANY STATE OR POLITICAL SUBDIVISION THEREOF, ANY FOREIGN
GOVERNMENT, ANY INTERNATIONAL ORGANIZATION, OR ANY AGENCY OR
INSTRUMENTALITY OF ANY OF THE FOREGOING, (2) ANY ORGANIZATION (OTHER THAN
A COOPERATIVE DESCRIBED IN SECTION 521 OF THE CODE) THAT 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, (3) ANY
ORGANIZATION DESCRIBED IN SECTION 1381(A)(2)(C) OF THE CODE (ANY SUCH
PERSON DESCRIBED IN THE
A-18-1
FOREGOING CLAUSES (1), (2) OR (3) SHALL HEREINAFTER BE REFERRED TO AS A
"DISQUALIFIED ORGANIZATION") OR (4) AN AGENT OF A DISQUALIFIED
ORGANIZATION AND (B) NO PURPOSE OF SUCH TRANSFER IS TO IMPEDE THE
ASSESSMENT OR COLLECTION OF TAX, AND (II) SUCH TRANSFEREE SATISFIES
CERTAIN ADDITIONAL CONDITIONS RELATING TO THE FINANCIAL CONDITION OF THE
PROPOSED TRANSFEREE. NOTWITHSTANDING THE REGISTRATION IN THE CERTIFICATE
REGISTER OF ANY TRANSFER, SALE OR OTHER DISPOSITION OF THIS CERTIFICATE TO
A DISQUALIFIED ORGANIZATION OR AN AGENT OF A DISQUALIFIED ORGANIZATION,
SUCH REGISTRATION SHALL BE DEEMED TO BE OF NO LEGAL FORCE OR EFFECT
WHATSOEVER AND SUCH PERSON SHALL NOT BE DEEMED TO BE A CERTIFICATEHOLDER
FOR ANY PURPOSE HEREUNDER, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF
DISTRIBUTIONS ON THIS CERTIFICATE. EACH HOLDER OF THIS CERTIFICATE BY
ACCEPTANCE HEREOF SHALL BE DEEMED TO HAVE CONSENTED TO THE PROVISIONS OF
THIS PARAGRAPH AND THE PROVISIONS OF SECTION 5.02(D) OF THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN. ANY PERSON THAT IS A DISQUALIFIED
ORGANIZATION IS PROHIBITED FROM ACQUIRING BENEFICIAL OWNERSHIP OF THIS
CERTIFICATE.
Series 2004-W7, Class R Aggregate Percentage Interest of the
Class R Certificates as of the
Issue Date: 100.00%
Date of Pooling and Servicing Agreement Percentage Interest
and Cut-off Date: May 1, 2004
Denomination: 100% Percentage Interest
First Distribution Date: June 25, 2004
Master Servicer: Ameriquest Mortgage
No. 1 Company
Trustee: Deutsche Bank National Trust
Company
Issue Date: May 4, 2004
A-18-2
ASSET-BACKED PASS-THROUGH CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional one- to four-family
adjustable-rate and fixed-rate first lien mortgage loans (the "Mortgage Loans")
formed and sold by
ARGENT SECURITIES INC.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ARGENT
SECURITIES INC., THE MASTER SERVICER, THE TRUSTEE OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING
MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES.
This certifies that Ameriquest Mortgage Company is the registered
owner of a Percentage Interest specified above in that certain beneficial
ownership interest evidenced by all the Class R Certificates in a REMIC created
pursuant to a Pooling and Servicing Agreement, dated as specified above (the
"Agreement"), among Argent Securities Inc. (hereinafter called the "Depositor,"
which term includes any successor entity under the Agreement), the Master
Servicer and the Trustee, a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the capitalized
terms used herein have the meanings assigned in the Agreement. This Certificate
is issued under and is subject to the terms, provisions and conditions of the
Agreement, to which Agreement the Holder of this Certificate by virtue of the
acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
First Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class R Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date or otherwise by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register. Notwithstanding the above, the final distribution on
this Certificate will be made after due notice by the Trustee of the pendency of
such distribution and only upon presentation and surrender of this Certificate
at the office or agency appointed by the Trustee for that purpose as provided in
the Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset- Backed Pass-Through Certificates of the Series specified on
the face hereof (herein called the "Certificates") and representing a Percentage
Interest in the Class of Certificates specified on the face
A-18-3
hereof equal to the denomination specified on the face hereof divided by the
aggregate Certificate Principal Balance of the Class of Certificates specified
on the face hereof.
The Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the Master
Servicer and the Trustee with the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No transfer of this Certificate shall be made unless the transfer is
made pursuant to an effective registration statement under the Securities Act of
1933, as amended (the "1933 Act"), and an effective registration or
qualification under applicable state securities laws, or is made in a
transaction that does not require such registration or qualification. In the
event that such a transfer of this Certificate is to be made without
registration or qualification, the Trustee and the Certificate Registrar shall
require receipt of (i) if such transfer is purportedly being made in reliance
upon Rule 144A under the 1933 Act, written certifications from the Holder of the
Certificate desiring to effect the transfer, and from such Holder's prospective
transferee, substantially in the forms attached to the Agreement as Exhibit F-1,
and (ii) in all other cases, an Opinion of Counsel satisfactory to it that such
transfer may be made without such registration or qualification (which Opinion
of Counsel shall not be an expense of the Trust Fund or of the Depositor, the
Trustee or the Master Servicer in their respective capacities as such), together
with copies of the written certification(s) of the Holder of the
A-18-4
Certificate desiring to effect the transfer and/or such Holder's prospective
transferee upon which such Opinion of Counsel is based. None of the Depositor,
the Certificate Registrar or the Trustee is obligated to register or qualify the
Class of Certificates specified on the face hereof under the 1933 Act or any
other securities law or to take any action not otherwise required under the
Agreement to permit the transfer of such Certificates without registration or
qualification. Any Holder desiring to effect a transfer of this Certificate
shall be required to indemnify the Trustee, the Depositor, the Certificate
Registrar and the Master Servicer against any liability that may result if the
transfer is not so exempt or is not made in accordance with such federal and
state laws.
No transfer of this Certificate to a Plan subject to ERISA or
Section 4975 of the Code, any Person acting, directly or indirectly, on behalf
of any such Plan or any Person using "Plan Assets" to acquire this Certificate
shall be made except in accordance with Section 5.02(c) of the Agreement.
Prior to registration of any transfer, sale or other disposition of
this Certificate, the proposed transferee shall provide to the Trustee (i) an
affidavit to the effect that such transferee is any Person other than a
Disqualified Organization or the agent (including a broker, nominee or
middleman) of a Disqualified Organization, and (ii) a certificate that
acknowledges that (A) the Class R Certificates have been designated as residual
interests in three REMICs, (B) it will include in its income a pro rata share of
the net income of the Trust Fund and that such income may be an "excess
inclusion," as defined in the Code, that, with certain exceptions, cannot be
offset by other losses or benefits from any tax exemption, and (C) it expects to
have the financial means to satisfy all of its tax obligations including those
relating to holding the Class R Certificates. Notwithstanding the registration
in the Certificate Register of any transfer, sale or other disposition of this
Certificate to a Disqualified Organization or an agent (including a broker,
nominee or middleman) of a Disqualified Organization, such registration shall be
deemed to be of no legal force or effect whatsoever and such Person shall not be
deemed to be a Certificateholder for any purpose, including, but not limited to,
the receipt of distributions in respect of this Certificate.
The Holder of this Certificate, by its acceptance hereof, shall be
deemed to have consented to the provisions of Section 5.02 of the Agreement and
to any amendment of the Agreement deemed necessary by counsel of the Depositor
to ensure that the transfer of this Certificate to any Person other than a
Permitted Transferee or any other Person will not cause the Trust Fund to cease
to qualify as a REMIC or cause the imposition of a tax upon the REMIC.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
The Depositor, the Master Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Master Servicer, the Trustee or
the Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Master Servicer, the Trustee, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
A-18-5
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by the Trustee and required to be paid to them pursuant to the Agreement
following the earlier of (i) the final payment or other liquidation (or any
advance with respect thereto) of the last Mortgage Loan remaining in REMIC I,
and (ii) the purchase by the party designated in the Agreement at a price
determined as provided in the Agreement from REMIC I of all the Mortgage Loans
and all property acquired in respect of such Mortgage Loans. The Agreement
permits, but does not require, the party designated in the Agreement to purchase
from REMIC I all the Mortgage Loans and all property acquired in respect of any
Mortgage Loan at a price determined as provided in the Agreement. The exercise
of such right will effect early retirement of the Certificates; however, such
right to purchase is subject to the aggregate Stated Principal Balance of the
Mortgage Loans at the time of purchase being less than 10% of the sum of the
aggregate Stated Principal Balance of the Initial Mortgage Loans at the Cut- off
Date.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-18-6
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: May __, 2004
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Trustee
By:______________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Certificate Registrar
By:______________________________
Authorized Signatory
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
----------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts to
Minors Act
JT TEN - as joint tenants with right if
survivorship and not as tenants ----------------------
in common (State)
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to____% evidenced by the within Asset-Backed Pass-
Through Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:__________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
A-18-8
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________ for the account of ___________________________,
account number______________ or, if mailed by check, to ________________________
_______________________________________________________________________________.
Applicable statements should be mailed to ______________________________________
________________________________________________________________________________
_______________________________________________________________________________.
This information is provided by ___________________________________, the
assignee named above, or ____________________________________, as its agent.
A-18-9
EXHIBIT A-19
FORM OF CLASS R-X CERTIFICATE
THIS CERTIFICATE MAY NOT BE TRANSFERRED TO A NON- UNITED STATES PERSON.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A
"RESIDUAL INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT"
("REMIC"), AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND
860D OF THE INTERNAL REVENUE CODE OF 1986 (THE "CODE").
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE
AND MAY NOT BE RESOLD OR TRANSFERRED UNLESS IT IS REGISTERED PURSUANT TO
SUCH ACT AND LAWS OR IS SOLD OR TRANSFERRED IN TRANSACTIONS THAT ARE
EXEMPT FROM REGISTRATION UNDER SUCH ACT AND UNDER APPLICABLE STATE LAW AND
IS TRANSFERRED IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF THE
AGREEMENT.
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE MADE
ONLY IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CERTIFICATE TO AN EMPLOYEE BENEFIT PLAN OR OTHER
RETIREMENT ARRANGEMENT (EACH A "PLAN") SUBJECT TO THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR THE CODE WILL BE
REGISTERED EXCEPT IN COMPLIANCE WITH THE PROCEDURES DESCRIBED HEREIN.
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE MADE
ONLY IF THE PROPOSED TRANSFEREE PROVIDES (I) AN AFFIDAVIT TO THE TRUSTEE
THAT (A) SUCH TRANSFEREE IS NOT (1) THE UNITED STATES OR ANY POSSESSION
THEREOF, ANY STATE OR POLITICAL SUBDIVISION THEREOF, ANY FOREIGN
GOVERNMENT, ANY INTERNATIONAL ORGANIZATION, OR ANY AGENCY OR
INSTRUMENTALITY OF ANY OF THE FOREGOING, (2) ANY ORGANIZATION (OTHER THAN
A COOPERATIVE DESCRIBED IN SECTION 521 OF THE CODE) THAT 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, (3) ANY
ORGANIZATION DESCRIBED IN SECTION 1381(A)(2)(C) OF THE CODE (ANY SUCH
PERSON DESCRIBED IN THE
A-19-1
FOREGOING CLAUSES (1), (2) OR (3) SHALL HEREINAFTER BE REFERRED TO AS A
"DISQUALIFIED ORGANIZATION") OR (4) AN AGENT OF A DISQUALIFIED
ORGANIZATION AND (B) NO PURPOSE OF SUCH TRANSFER IS TO IMPEDE THE
ASSESSMENT OR COLLECTION OF TAX, AND (II) SUCH TRANSFEREE SATISFIES
CERTAIN ADDITIONAL CONDITIONS RELATING TO THE FINANCIAL CONDITION OF THE
PROPOSED TRANSFEREE. NOTWITHSTANDING THE REGISTRATION IN THE CERTIFICATE
REGISTER OF ANY TRANSFER, SALE OR OTHER DISPOSITION OF THIS CERTIFICATE TO
A DISQUALIFIED ORGANIZATION OR AN AGENT OF A DISQUALIFIED ORGANIZATION,
SUCH REGISTRATION SHALL BE DEEMED TO BE OF NO LEGAL FORCE OR EFFECT
WHATSOEVER AND SUCH PERSON SHALL NOT BE DEEMED TO BE A CERTIFICATEHOLDER
FOR ANY PURPOSE HEREUNDER, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF
DISTRIBUTIONS ON THIS CERTIFICATE. EACH HOLDER OF THIS CERTIFICATE BY
ACCEPTANCE HEREOF SHALL BE DEEMED TO HAVE CONSENTED TO THE PROVISIONS OF
THIS PARAGRAPH AND THE PROVISIONS OF SECTION 5.02(D) OF THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN. ANY PERSON THAT IS A DISQUALIFIED
ORGANIZATION IS PROHIBITED FROM ACQUIRING BENEFICIAL OWNERSHIP OF THIS
CERTIFICATE.
Series 2004-W7, Class R-X Aggregate Percentage Interest of the
Class R-X Certificates as of the
Issue Date: 100.00%
Date of Pooling and Servicing Agreement Percentage Interest
and Cut-off Date: May 1, 2004
Denomination: 100% Percentage Interest
First Distribution Date: June 25, 2004
Master Servicer: Ameriquest Mortgage
No. 1 Company
Trustee: Deutsche Bank National Trust
Company
Issue Date: May 4, 2004
A-19-2
ASSET-BACKED PASS-THROUGH CERTIFICATE
evidencing a beneficial ownership interest in a Trust Fund (the "Trust Fund")
consisting primarily of a pool of conventional one- to four-family
adjustable-rate and fixed-rate first lien mortgage loans (the "Mortgage Loans")
formed and sold by
ARGENT SECURITIES INC.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ARGENT
SECURITIES INC., THE MASTER SERVICER, THE TRUSTEE OR ANY OF THEIR
RESPECTIVE AFFILIATES. NEITHER THIS CERTIFICATE NOR THE UNDERLYING
MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY OF THE
UNITED STATES.
This certifies that MKM I Corp. is the registered owner of a
Percentage Interest specified above in that certain beneficial ownership
interest evidenced by all the Class R-X Certificates in a REMIC created pursuant
to a Pooling and Servicing Agreement, dated as specified above (the
"Agreement"), among Argent Securities Inc. (hereinafter called the "Depositor,"
which term includes any successor entity under the Agreement), the Master
Servicer and the Trustee, a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the capitalized
terms used herein have the meanings assigned in the Agreement. This Certificate
is issued under and is subject to the terms, provisions and conditions of the
Agreement, to which Agreement the Holder of this Certificate by virtue of the
acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
First Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Record Date, in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class R-X Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the
Agreement will be made or caused to be made by or on behalf of the Trustee by
wire transfer in immediately available funds to the account of the Person
entitled thereto if such Person shall have so notified the Trustee in writing at
least five Business Days prior to the Record Date immediately prior to such
Distribution Date or otherwise by check mailed by first class mail to the
address of the Person entitled thereto, as such name and address shall appear on
the Certificate Register. Notwithstanding the above, the final distribution on
this Certificate will be made after due notice by the Trustee of the pendency of
such distribution and only upon presentation and surrender of this Certificate
at the office or agency appointed by the Trustee for that purpose as provided in
the Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Asset- Backed Pass-Through Certificates of the Series specified on
the face hereof (herein called the "Certificates") and representing a Percentage
Interest in the Class of Certificates specified on the face
A-19-3
hereof equal to the denomination specified on the face hereof divided by the
aggregate Certificate Principal Balance of the Class of Certificates specified
on the face hereof.
The Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Master Servicer, the Trustee and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the Master
Servicer and the Trustee with the consent of the Holders of Certificates
entitled to at least 66% of the Voting Rights. Any such consent by the Holder of
this Certificate shall be conclusive and binding on such Holder and upon all
future Holders of this Certificate and of any Certificate issued upon the
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent is made upon this Certificate. The Agreement also permits the
amendment thereof, in certain limited circumstances, without the consent of the
Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies appointed by the Trustee as provided in the
Agreement, duly endorsed by, or accompanied by an assignment in the form below
or other written instrument of transfer in form satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder hereof or such Holder's
attorney duly authorized in writing, and thereupon one or more new Certificates
of the same Class in authorized denominations evidencing the same aggregate
Percentage Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No transfer of this Certificate shall be made unless the transfer is
made pursuant to an effective registration statement under the Securities Act of
1933, as amended (the "1933 Act"), and an effective registration or
qualification under applicable state securities laws, or is made in a
transaction that does not require such registration or qualification. In the
event that such a transfer of this Certificate is to be made without
registration or qualification, the Trustee and the Certificate Registrar shall
require receipt of (i) if such transfer is purportedly being made in reliance
upon Rule 144A under the 1933 Act, written certifications from the Holder of the
Certificate desiring to effect the transfer, and from such Holder's prospective
transferee, substantially in the forms attached to the Agreement as Exhibit F-1,
and (ii) in all other cases, an Opinion of Counsel satisfactory to it that such
transfer may be made without such registration or qualification (which Opinion
of Counsel shall not be an expense of the Trust Fund or of the Depositor, the
Trustee or the Master Servicer in their respective capacities as such), together
with copies of the written certification(s) of the Holder of the
A-19-4
Certificate desiring to effect the transfer and/or such Holder's prospective
transferee upon which such Opinion of Counsel is based. None of the Depositor,
the Certificate Registrar or the Trustee is obligated to register or qualify the
Class of Certificates specified on the face hereof under the 1933 Act or any
other securities law or to take any action not otherwise required under the
Agreement to permit the transfer of such Certificates without registration or
qualification. Any Holder desiring to effect a transfer of this Certificate
shall be required to indemnify the Trustee, the Depositor, the Certificate
Registrar and the Master Servicer against any liability that may result if the
transfer is not so exempt or is not made in accordance with such federal and
state laws.
No transfer of this Certificate to a Plan subject to ERISA or
Section 4975 of the Code, any Person acting, directly or indirectly, on behalf
of any such Plan or any Person using "Plan Assets" to acquire this Certificate
shall be made except in accordance with Section 5.02(c) of the Agreement.
Prior to registration of any transfer, sale or other disposition of
this Certificate, the proposed transferee shall provide to the Trustee (i) an
affidavit to the effect that such transferee is any Person other than a
Disqualified Organization or the agent (including a broker, nominee or
middleman) of a Disqualified Organization, and (ii) a certificate that
acknowledges that (A) the Class R-X Certificates have been designated as
residual interests in two REMICs, (B) it will include in its income a pro rata
share of the net income of the Trust Fund and that such income may be an "excess
inclusion," as defined in the Code, that, with certain exceptions, cannot be
offset by other losses or benefits from any tax exemption, and (C) it expects to
have the financial means to satisfy all of its tax obligations including those
relating to holding the Class R-X Certificates. Notwithstanding the registration
in the Certificate Register of any transfer, sale or other disposition of this
Certificate to a Disqualified Organization or an agent (including a broker,
nominee or middleman) of a Disqualified Organization, such registration shall be
deemed to be of no legal force or effect whatsoever and such Person shall not be
deemed to be a Certificateholder for any purpose, including, but not limited to,
the receipt of distributions in respect of this Certificate.
The Holder of this Certificate, by its acceptance hereof, shall be
deemed to have consented to the provisions of Section 5.02 of the Agreement and
to any amendment of the Agreement deemed necessary by counsel of the Depositor
to ensure that the transfer of this Certificate to any Person other than a
Permitted Transferee or any other Person will not cause the Trust Fund to cease
to qualify as a REMIC or cause the imposition of a tax upon the REMIC.
No service charge will be made for any such registration of transfer
or exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
The Depositor, the Master Servicer, the Trustee and the Certificate
Registrar and any agent of the Depositor, the Master Servicer, the Trustee or
the Certificate Registrar may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and none of the Depositor, the
Master Servicer, the Trustee, the Certificate Registrar nor any such agent shall
be affected by notice to the contrary.
A-19-5
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by the Trustee and required to be paid to them pursuant to the Agreement
following the earlier of (i) the final payment or other liquidation (or any
advance with respect thereto) of the last Mortgage Loan remaining in REMIC I,
and (ii) the purchase by the party designated in the Agreement at a price
determined as provided in the Agreement from REMIC I of all the Mortgage Loans
and all property acquired in respect of such Mortgage Loans. The Agreement
permits, but does not require, the party designated in the Agreement to purchase
from REMIC I all the Mortgage Loans and all property acquired in respect of any
Mortgage Loan at a price determined as provided in the Agreement. The exercise
of such right will effect early retirement of the Certificates; however, such
right to purchase is subject to the aggregate Stated Principal Balance of the
Mortgage Loans at the time of purchase being less than 10% of the sum of the
aggregate Stated Principal Balance of the Initial Mortgage Loans at the Cut- off
Date.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-19-6
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated: May __, 2004
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Trustee
By:_______________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
DEUTSCHE BANK NATIONAL TRUST
COMPANY
as Certificate Registrar
By:_______________________________
Authorized Signatory
A-19-7
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out in
full according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
----------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts to
Minors Act
JT TEN - as joint tenants with right if
survivorship and not as tenants ----------------------
in common (State)
Additional abbreviations may also be used though not in the above list.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to____% evidenced by the within Asset-Backed
Pass-Through Certificate and hereby authorize(s) the registration of transfer of
such interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:__________________________
________________________________________________________________________________
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
A-19-8
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
_______________________________for the account of _____________________________,
account number______________ or, if mailed by check, to ________________________
_______________________________________________________________________________.
Applicable statements should be mailed to ______________________________________
________________________________________________________________________________
_______________________________________________________________________________.
This information is provided by
_______________________________________________, the assignee named above, or
____________________________________, as its agent.
A-19-9
EXHIBIT B
FORM OF LOST NOTE AFFIDAVIT
Loan #: ____________
Borrower: _____________
LOST NOTE AFFIDAVIT
I, as ____________________ of ___________________, a _______________
corporation am authorized to make this Affidavit on behalf of
_____________________ (the "Seller"). In connection with the administration of
the Mortgage Loans held by ____________________, a _________________ corporation
as Seller on behalf of Argent Securities Inc. (the "Purchaser"), _______________
(the "Deponent"), being duly sworn, deposes and says that:
1. The Seller's address is: _____________________
_____________________
_____________________
2. The Seller previously delivered to the Purchaser a signed Initial
Certification with respect to such Mortgage and/or Assignment of
Mortgage;
3. Such Mortgage Note and/or Assignment of Mortgage was assigned or
sold to the Purchaser by ________________________, a ____________
corporation pursuant to the terms and provisions of a Mortgage Loan
Purchase Agreement dated as of __________ __, _____;
4. Such Mortgage Note and/or Assignment of Mortgage is not outstanding
pursuant to a request for release of Documents;
5. Aforesaid Mortgage Note and/or Assignment of Mortgage (the
"Original") has been lost;
6. Deponent has made or caused to be made a diligent search for the
Original and has been unable to find or recover same;
7. The Seller was the Seller of the Original at the time of the loss;
and
8. Deponent agrees that, if said Original should ever come into
Seller's possession, custody or power, Seller will immediately and
without consideration surrender the Original to the Purchaser.
9. Attached hereto is a true and correct copy of (i) the Note, endorsed
in blank by the Mortgagee and (ii) the Mortgage or Deed of Trust
(strike one) which secures the Note, which Mortgage or Deed of Trust
is recorded in the county where the property is located.
B-1
10. Deponent hereby agrees that the Seller (a) shall indemnify and hold
harmless the Purchaser, its successors and assigns, against any
loss, liability or damage, including reasonable attorney's fees,
resulting from the unavailability of any Notes, including but not
limited to any loss, liability or damage arising from (i) any false
statement contained in this Affidavit, (ii) any claim of any party
that has already purchased a mortgage loan evidenced by the Lost
Note or any interest in such mortgage loan, (iii) any claim of any
borrower with respect to the existence of terms of a mortgage loan
evidenced by the Lost Note on the related property to the fact that
the mortgage loan is not evidenced by an original note and (iv) the
issuance of a new instrument in lieu thereof (items (i) through (iv)
above hereinafter referred to as the "Losses") and (b) if required
by any Rating Agency in connection with placing such Lost Note into
a Pass-Through Transfer, shall obtain a surety from an insurer
acceptable to the applicable Rating Agency to cover any Losses with
respect to such Lost Note.
11. This Affidavit is intended to be relied upon by the Purchaser, its
successors and assigns. _____________________, a ______________
corporation represents and warrants that it has the authority to
perform its obligations under this Affidavit of Lost Note.
Executed this ____ day, of ___________ ______.
SELLER
By:_________________________
Name:
Title:
On this _____ day of ________, _____, before me appeared
_________________ to me personally known, who being duly sworn did say that he
is the _____________________ of ____________________ a ______________
corporation and that said Affidavit of Lost Note was signed and sealed on behalf
of such corporation and said acknowledged this instrument to be the free act and
deed of said corporation.
Signature:
[Seal]
B-2
EXHIBIT C-1
FORM OF TRUSTEE'S INITIAL CERTIFICATION
[Date]
Argent Securities Inc.
0000 Xxxx & Xxxxxxx Xxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxxxx 00000
Ameriquest Mortgage Company
0000 Xxxx & Xxxxxxx Xxxx
Xxxxxx, Xxxxxxxxxx 00000
Re: Pooling and Servicing Agreement, dated as of May 1, 2004,
among Argent Securities Inc., Ameriquest Mortgage Company and
Deutsche Bank National Trust Company, relating to Argent
Securities Inc., Asset-Backed Pass- Through Certificates,
Series 2004-W7
Ladies and Gentlemen:
Pursuant to Section 2.01 of the Pooling and Servicing Agreement,
dated as of May 1 2004, among Argent Securities Inc. as Depositor, Ameriquest
Mortgage Company, as master servicer and Deutsche Bank National Trust Company as
trustee, we hereby acknowledge that as to each Mortgage Loan listed in the
Mortgage Loan Schedule (other than any Mortgage Loan paid in full or any
Mortgage Loan specifically identified in the exception report annexed thereto as
not being covered by such certification), (i) all documents constituting part of
such Mortgage File (other than such documents described in Section 2.01(v))
required to be delivered to it pursuant to this Agreement are in its possession,
(ii) such documents have been reviewed by it or such Custodian and are not
mutilated, torn or defaced unless initialed by the related borrower and relate
to such Mortgage Loan, (iii) based on its or the Custodian's examination and
only as to the foregoing, the information set forth in the Mortgage Loan
Schedule that corresponds to items (1) through (3), (6), (9), (10), (13), (15)
and (19) of the definition of "Mortgage Loan Schedule" accurately reflects
information set forth in the Mortgage File.
The Trustee has made no independent examination of any documents
contained in each Mortgage File beyond the review specifically required in the
above-referenced Pooling and Servicing Agreement. The Trustee makes no
representations as to: (i) the validity, legality, sufficiency, recordability,
enforceability or genuineness of any of the documents contained in the Mortgage
File of any of the Mortgage Loans identified on the Mortgage Loan Schedule, or
(ii) the collectability, insurability, perfection, priority, effectiveness or
suitability of any such Mortgage Loan.
The Trustee was under no duty or obligation (i) to inspect, review
or examine any such documents, instruments, certificates or other papers to
determine whether they are genuine, enforceable, or appropriate for the
represented purpose or whether they have actually been recorded
C-1-1
or that they are other than what they purport to be on their face or (ii) to
determine whether any Mortgage File should include any of the documents
specified in clause (v) of Section 2.01.
Capitalized terms used but not defined herein shall have the
meanings assigned to them in the Pooling and Servicing Agreement.
DEUTSCHE BANK NATIONAL TRUST
COMPANY, as Trustee
By:______________________________
Name:
Title:
C-1-2
EXHIBIT C-2
FORM OF TRUSTEE'S FINAL CERTIFICATION
[Date]
Argent Securities Inc.
0000 Xxxx & Xxxxxxx Xxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxxxx 00000
Ameriquest Mortgage Company
0000 Xxxx & Xxxxxxx Xxxx
Xxxxxx, Xxxxxxxxxx 00000
Re: Pooling and Servicing Agreement, dated as of May 1, 2004,
among Argent Securities Inc., Ameriquest Mortgage Company and
Deutsche Bank National Trust Company, relating to Argent
Securities Inc. Asset-Backed Pass-Through Certificates, Series
2004-W7
Ladies and Gentlemen:
In accordance with Section 2.02 of the above-captioned Pooling and
Servicing Agreement, the undersigned, as Trustee, 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 a Custodian on its
behalf has received each of the documents listed in Section 2.01.
The Trustee has made no independent examination of any documents
contained in each Mortgage File beyond the review specifically required in the
above-referenced Pooling and Servicing Agreement. The Trustee makes no
representations as to: (i) the validity, legality, sufficiency, recordability,
enforceability or genuineness of any of the documents contained in the Mortgage
File of any of the Mortgage Loans identified on the Mortgage Loan Schedule, or
(ii) the collectability, insurability, perfection, priority, effectiveness or
suitability of any such Mortgage Loan.
Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the above-captioned Pooling and Servicing
Agreement.
DEUTSCHE BANK NATIONAL TRUST
COMPANY, as Trustee
By:_____________________________
Name:
Title:
C-2-1
EXHIBIT C-3
FORM OF TRUSTEE'S RECEIPT OF MORTGAGE NOTE
[Date]
Argent Securities Inc.
0000 Xxxx & Xxxxxxx Xxxx
Xxxxxx, Xxxxxxxxxx 00000
Ameriquest Mortgage Company
0000 Xxxx & Xxxxxxx Xxxx
Xxxxxx, Xxxxxxxxxx 00000
Re: Pooling and Servicing Agreement, dated as of May 2004, among
Argent Securities Inc., Ameriquest Mortgage Company and
Deutsche Bank National Trust Company, relating to Argent
Securities Inc., Asset-Backed Pass-Through Certificates,
Series 2004-W7
Ladies and Gentlemen:
Pursuant to Section 2.01 of the Pooling and Servicing Agreement,
dated as of May 1, 2004, among Argent Securities Inc. as depositor, Ameriquest
Mortgage Company as master servicer and Deutsche Bank National Trust Company as
trustee, we hereby acknowledge the receipt of the original Mortgage Note for
each Mortgage Loan with any exceptions thereto listed on Exhibit 1.
Capitalized terms used but not defined herein shall have the
meanings assigned to them in the Pooling and Servicing Agreement.
DEUTSCHE BANK NATIONAL TRUST
COMPANY, as Trustee
By:____________________________
Name:
Title:
C-3-1
EXHIBIT D
FORM OF MORTGAGE LOAN PURCHASE AGREEMENT
D-1
MORTGAGE LOAN PURCHASE AGREEMENT
This is a Mortgage Loan Purchase Agreement (the "Agreement"), dated
April 30, 2004, between Ameriquest Mortgage Company, a Delaware corporation (the
"Seller") and Argent Securities Inc., a Delaware corporation (the "Purchaser").
Preliminary Statement
The Seller intends to sell the Mortgage Loans (as hereinafter
defined) to the Purchaser on the terms and subject to the conditions set forth
in this Agreement. The Purchaser shall deposit the Mortgage Loans into a
mortgage pool constituting the Trust Fund. The Trust Fund will be evidenced by a
single series of asset-backed pass-through certificates designated as Series
2004-W7 (the "Certificates"). The Certificates will consist of nineteen classes
of certificates. The Class CE Certificates, the Class P Certificates and the
Residual Certificates (collectively, the "Non-Offered Certificates") will be
delivered to the Seller or its designee as partial consideration for the
Mortgage Loans as further described below.
The Certificates will be issued pursuant to a Pooling and Servicing
Agreement relating to the Series 2004-W7 Certificates, dated as of May 1, 2004
(the "Pooling and Servicing Agreement"), among the Purchaser as depositor (in
such capacity, the "Depositor"), the Seller as master servicer (the "Master
Servicer") and Deutsche Bank National Trust Company as trustee (in such
capacity, the "Trustee"). Pursuant to the Pooling and Servicing Agreement, the
Depositor will assign all of its right, title and interest in and to the
Mortgage Loans, together with its rights under this Agreement, to the Trustee
for the benefit of the Certificateholders. Capitalized terms used but not
defined herein shall have the meanings set forth in the Pooling and Servicing
Agreement.
The parties hereto agree as follows:
SECTION 1. Agreement to Purchase. The Seller hereby sells, and the
Purchaser hereby purchases, on or before May 4, 2004 (the "Closing Date"),
certain adjustable-rate and fixed- rate conventional, one- to four-family,
residential mortgage loans (the "Mortgage Loans"), having an aggregate principal
balance as of the close of business on May 1, 2004 (the "Cut-off Date") of
$800,000,174.23 after giving effect to all payments due on the Mortgage Loans on
or before the Cut- off Date (the "Closing Balance"), whether or not received,
including the right to any Prepayment Charges collected after the Cut-off Date
from the Mortgagors in connection with any Principal Prepayments on the Mortgage
Loans. Any payments (including Prepayment Charges) collected on or before the
Cut-off Date, including all scheduled payments of principal and interest due on
or before the Cut-off Date and collected after the Cut-off Date, shall belong to
the Seller. In addition to the sale of the Mortgage Loans, the Seller will cause
the Cap Contracts to be transferred to the Purchaser.
SECTION 2. Mortgage Loan Schedule and Prepayment Charge Schedule.
The Purchaser and the Seller have agreed upon which of the mortgage loans owned
by the Seller are to be purchased by the Purchaser pursuant to this Agreement,
and the Seller shall prepare or cause to
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be prepared on or prior to the Closing Date a final schedule (the "Closing
Schedule") describing such Mortgage Loans and setting forth all of the Mortgage
Loans to be purchased under this Agreement. The Closing Schedule shall conform
to the requirements set forth in this Agreement and to the definition of
"Mortgage Loan Schedule" under the Pooling and Servicing Agreement. The Closing
Schedule shall be used as the Mortgage Loan Schedule under the Pooling and
Servicing Agreement. The Seller shall also prepare or cause to be prepared on or
prior to the Closing Date a final schedule (the "Prepayment Charge Schedule")
setting forth each Mortgage Loan containing a Prepayment Charge and conforming
to the definition of Prepayment Charge Schedule under the Pooling and Servicing
Agreement.
SECTION 3. Consideration.
In consideration for the Mortgage Loans that will be purchased
hereunder, the Purchaser shall, as described in Section 8, (i) pay to or upon
the order of the Seller in immediately available funds an amount equal to the
net sale proceeds of the Class A-1 Certificates, the Class A-2 Certificates, the
Class A-3 Certificates, the Class A-4 Certificates, the Class A-5 Certificates,
the Class M-1 Certificates, the Class M-2 Certificates, the Class M-3
Certificates, the Class M-4 Certificates, the Class M-5 Certificates, the Class
M-6 Certificates, the Class M-7 Certificates, the Class M-8 Certificates, the
Class M-9 Certificates and the Class M-10 Certificates and (ii) deliver to the
Seller, or its designee, the Non-Offered Certificates.
SECTION 4. Transfer of the Mortgage Loans.
(a) Possession of Mortgage Files. The Seller does hereby sell to the
Purchaser, without recourse but subject to the terms of this Agreement, all of
its right, title and interest in, to and under the Mortgage Loans, including the
related Prepayment Charges collected after the Cut-off Date. The contents of
each Mortgage File not delivered to the Purchaser or to any assignee, transferee
or designee of the Purchaser on or prior to the Closing Date are and shall be
held in trust by the Seller for the benefit of the Purchaser or any assignee,
transferee or designee of the Purchaser. Upon the sale and contribution of the
Mortgage Loans, the ownership of each Mortgage Note, the related Mortgage and
the other contents of the related Mortgage File is vested in the Purchaser and
the ownership of all records and documents with respect to the related Mortgage
Loan prepared by or that come into the possession of the Seller on or after the
Closing Date shall immediately vest in the Purchaser and shall be delivered
immediately to the Purchaser or as otherwise directed by the Purchaser.
(b) Delivery of Mortgage Loan Documents. The Seller will, on or
prior to the Closing Date, deliver or cause to be delivered to the Purchaser or
any assignee, transferee or designee of the Purchaser each of the following
documents for each Mortgage Loan:
(i) the original Mortgage Note, endorsed in blank, without recourse,
or in the following form: "Pay to the order of Deutsche Bank National
Trust Company, as Trustee
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under the applicable agreement, without recourse," with all prior and
intervening endorsements showing a complete chain of endorsement from the
originator to the Person so endorsing to the Trustee, or with respect to
any lost Mortgage Note, an original Lost Note Affidavit; provided however,
that such substitutions of Lost Note Affidavits for original Mortgage
Notes may occur only with respect to Mortgage Loans, the aggregate Cut-off
Date Principal Balance of which is less than or equal to 2.00% of the Pool
Balance as of the Cut-off Date;
(ii) the original Mortgage with evidence of recording thereon, and a
copy, certified by the appropriate recording office, of the recorded power of
attorney, if the Mortgage was executed pursuant to a power of attorney, with
evidence of recording thereon;
(iii) an original Assignment of the Mortgage assigned in blank,
without recourse;
(iv) the original recorded intervening Assignment or Assignments of
the Mortgage showing a complete chain of assignment from the originator to the
Person assigning the Mortgage to the Trustee as contemplated by the immediately
preceding clause (iii) or the original unrecorded intervening Assignments;
(v) the original or copies of each assumption, modification, written
assurance or substitution agreement, if any; and
(vi) the original lenders's title insurance policy or an attorney's
opinion of title or similar guarantee of title acceptable to mortgage lenders
generally in the jurisdiction where the Mortgaged Property is located, together
with all endorsements or riders which were issued with or subsequent to the
issuance of such policy, insuring the priority of the Mortgage as a first lien
on the Mortgaged Property represented therein as a fee interest vested in the
Mortgagor, or in the event such original title policy is unavailable, a written
commitment or uniform binder or preliminary report of title issued by the title
insurance or escrow company.
If any document referred to in Section 4(b)(ii), 4(b)(iii) or 4(b)(iv)
above has been submitted for recording but either (x) has not been returned from
the applicable public recording office or (y) has been lost or such public
recording office has retained the original of such document, the obligations of
the Seller hereunder shall be deemed to have been satisfied upon (1) delivery by
or on behalf of the Seller promptly upon receipt thereof to the Purchaser or any
assignee, transferee or designee of the Purchaser of either the original or a
copy of such document certified by the Seller in the case of (x) above or the
public recording office in the case of (y) above to be a true and complete copy
of the recorded original thereof and (2) if such delivered copy is certified by
the Seller then in addition thereto delivery promptly upon receipt thereof of
either the original or a copy of such document certified by the public recording
office to be a true and complete copy of the original. In the event that the
original lender's title insurance policy has not yet been issued, the Seller
shall deliver to the Purchaser or any assignee, transferee or designee of the
Purchaser a written
-4-
commitment or interim binder or preliminary report of title issued by the title
insurance or escrow company. Promptly upon receipt by the Seller of any such
original title insurance policy the Seller shall deliver such to the Purchaser
or any assignee, transferee or designee of the Purchaser.
The Seller shall promptly (and in no event later than thirty (30)
Business Days, subject to extension upon mutual agreement between the Seller and
the Trustee, following the later of (i) the Closing Date, (ii) the date on which
the Seller receives the Assignment from the Trustee and (iii) the date of
receipt by the Seller of the recording information for a Mortgage) submit or
cause to be submitted for recording, at no expense to the Trust Fund or the
Trustee, in the appropriate public office for real property records, each
Assignment referred to in (iii) and (iv) above and shall execute each original
Assignment referred to in (iii) in the following form: "Deutsche Bank National
Trust Company, as Trustee under the applicable agreement without recourse". In
the event that any such Assignment is lost or returned unrecorded because of a
defect therein, the Seller shall promptly prepare or cause to be prepared a
substitute Assignment or cure or cause to be cured such defect, as the case may
be, and thereafter cause each such Assignment to be duly recorded.
Notwithstanding the foregoing, however, for administrative
convenience and facilitation of servicing and to reduce closing costs, the
Assignments of Mortgage shall not be required to be submitted for recording
(except with respect to any Mortgage Loan located in Maryland) unless such
failure to record would result in a withdrawal or a downgrading by any Rating
Agency of the rating on any Class of Certificates; provided further, however,
each Assignment of Mortgage shall be submitted for recording by the Seller in
the manner described above, at no expense to the Trust Fund or the Trustee, upon
the earliest to occur of: (i) reasonable direction by Holders of Certificates
entitled to at least 25% of the Voting Rights or the NIMS Insurer, (ii) a
failure of the Master Servicer Termination Test as set forth in the Pooling and
Servicing Agreement, (iii) the occurrence of the bankruptcy or insolvency of the
Seller, (iv) the occurrence of a servicing transfer as described in Section 7.02
of the Pooling and Servicing Agreement, and (v) if the Seller is not the Master
Servicer and with respect to any one assignment or Mortgage, the occurrence of a
bankruptcy, insolvency or foreclosure relating to the Mortgagor under the
related Mortgage.
Each original document relating to any Mortgage Loan which is not
delivered to the Purchaser or its assignee, transferee or designee, if held by
the Seller, shall be so held for the benefit of the Purchaser or its assignee,
transferee or designee.
(c) Acceptance of Mortgage Loans. The documents delivered pursuant
to Section 4(b) hereof shall be reviewed by the Purchaser or any assignee,
transferee or designee of the Purchaser at any time before or after the Closing
Date (and with respect to each document permitted to be delivered after the
Closing Date within seven days of its delivery) to ascertain that all required
documents have been executed and received and that such documents relate to the
Mortgage Loans identified on the Mortgage Loan Schedule.
(d) Reserved.
-5-
(e) Transfer of Interest in Agreements. The Purchaser has the right
to assign its interest under this Agreement, in whole or in part, to the
Trustee, as may be required to effect the purposes of the Pooling and Servicing
Agreement, without the consent of the Seller, and the assignee shall succeed to
the rights and obligations hereunder of the Purchaser. Any expense reasonably
incurred by or on behalf of the Purchaser or the Trustee in connection with
enforcing any obligations of the Seller under this Agreement will be promptly
reimbursed by the Seller.
(f) Examination of Mortgage Files. Prior to the Closing Date, the
Seller shall either (i) deliver in escrow to the Purchaser or to any assignee,
transferee or designee of the Purchaser, for examination, the Mortgage File
pertaining to each Mortgage Loan or (ii) make such Mortgage Files available to
the Purchaser or to any assignee, transferee or designee of the Purchaser for
examination at the Trustee's offices in Santa Ana, California. Such examination
may be made by the Purchaser, and its respective designees, upon reasonable
notice to the Seller and the Trustee during normal business hours before the
Closing Date and within 60 days after the Closing Date. If any such person makes
such examination prior to the Closing Date and identifies any Mortgage Loans
that do not conform to the requirements of the Purchaser as described in this
Agreement, such Mortgage Loans shall be deleted from the Closing Schedule. The
Purchaser may, at its option and without notice to the Seller, purchase all or
part of the Mortgage Loans without conducting any partial or complete
examination. The fact that the Purchaser or any person has conducted or has
failed to conduct any partial or complete examination of the Mortgage Files
shall not affect the rights of the Purchaser or any assignee, transferee or
designee of the Purchaser to demand repurchase or other relief as provided
herein or under the Pooling and Servicing Agreement.
SECTION 5. Representations, Warranties and Covenants of the Seller.
The Seller hereby represents and warrants to the Purchaser, as of
the date hereof and as of the Closing Date, and covenants, that:
(i) The Seller is a corporation duly organized, validly existing and
in good standing under the laws of the State of Delaware and is duly authorized
and qualified to transact any and all business contemplated by this Agreement to
be conducted by the Seller in any state in which a Mortgaged Property is located
or is otherwise not required under applicable law to effect such qualification
and, in any event, is in compliance with the doing business laws of any such
State, to the extent necessary to ensure the ability of the Master Servicer to
enforce each Mortgage Loan and to service the Mortgage Loans in accordance with
the terms of the Pooling and Servicing Agreement;
(ii) The Seller had the full corporate power and authority to hold
and sell each Mortgage Loan and has the full corporate power and authority to
service each Mortgage Loan, and to execute, deliver and perform, and to enter
into and consummate the transactions contemplated by this Agreement and has duly
authorized by all necessary corporate action on the part of the Seller the
execution, delivery and performance of this Agreement; this Agreement has been
duly executed and delivered by the Seller; and this Agreement, assuming the due
authorization, execution and
-6-
delivery thereof by the Purchaser, constitutes a legal, valid and binding
obligation of the Seller, enforceable against the Seller in accordance with its
terms, except to the extent that (a) the enforceability thereof may be limited
by bankruptcy, insolvency, moratorium, receivership and other similar laws
relating to creditors' rights generally and (b) the remedy of specific
performance and injunctive and other forms of equitable relief may be subject to
the equitable defenses and to the discretion of the court before which any
proceeding therefor may be brought;
(iii) The execution and delivery of this Agreement by the Seller,
the servicing of the Mortgage Loans by the Seller under the Pooling and
Servicing Agreement, the consummation of any other of the transactions herein
contemplated, and the fulfillment of or compliance with the terms hereof are in
the ordinary course of business of the Seller and will not (A) result in a
breach of any term or provision of the charter or by-laws of the Seller or (B)
conflict with, result in a breach, violation or acceleration of, or result in a
default under, the terms of any other material agreement or instrument to which
the Seller is a party or by which it may be bound, or any statute, order or
regulation applicable to the Seller of any court, regulatory body,
administrative agency or governmental body having jurisdiction over the Seller;
and the Seller is not a party to, bound by, or in breach or violation of any
indenture or other agreement or instrument, or subject to or in violation of any
statute, order or regulation of any court, regulatory body, administrative
agency or governmental body having jurisdiction over it, which materially and
adversely affects or, to the Seller's knowledge, would in the future materially
and adversely affect, (x) the ability of the Seller to perform its obligations
under this Agreement or (y) the business, operations, financial condition,
properties or assets of the Seller taken as a whole;
(iv) No consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by the Seller of, or compliance by the Seller with, this Agreement
or the consummation of the transactions contemplated hereby, or if any such
consent, approval, authorization or order is required, the Seller has obtained
the same;
(v) The Seller is an approved originator/servicer for Xxxxxx Xxx or
Xxxxxxx Mac in good standing and is a HUD approved mortgagee pursuant to Section
203 and Section 211 of the National Housing Act; and
(vi) Except as otherwise disclosed in the Prospectus Supplement, no
litigation is pending against the Seller that would materially and adversely
affect the execution, delivery or enforceability of this Agreement or the
ability of the Seller to service the Mortgage Loans or the Seller to perform any
of its other obligations hereunder in accordance with the terms hereof.
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SECTION 6. Representations and Warranties of the Seller Relating to
the Mortgage Loans.
The Seller hereby represents and warrants to the Purchaser, with
respect to the Mortgage Loans as of the Closing Date or as of such date
specifically provided herein:
(i) The information set forth on the Mortgage Loan Schedule
with respect to each Mortgage Loan is true and correct in all material respects;
(ii) [Reserved];
(iii) No material error, omission, misrepresentation,
negligence, fraud or similar occurrence with respect to any Mortgage Loan has
taken place on the part of any person, including without limitation, the
Mortgagor, any appraiser, any builder or developer, or any other party involved
in the origination of the Mortgage Loan or in the application of any insurance
in relation to such Mortgage Loan;
(iv) All payments due prior to the Cut-off Date have been made
and none of the Mortgage Loans will have been contractually delinquent for more
than one calendar month more than once since the origination thereof;
(v) Each Mortgage is a valid and enforceable first lien on the
Mortgaged Property, including all improvements thereon, subject only to (a) the
lien of nondelinquent current real property taxes and assessments, (b)
covenants, conditions and restrictions, rights of way, easements and other
matters of public record as of the date of recording of such Mortgage, such
exceptions appearing of record being acceptable to mortgage lending institutions
generally or specifically reflected in the appraisal made in connection with the
origination of the related Mortgage Loan, and (c) other matters to which like
properties are commonly subject which do not materially interfere with the
benefits of the security intended to be provided by such Mortgage;
(vi) Immediately prior to the sale of the Mortgage Loans to
the Purchaser, the Seller had good title to, and was the sole legal and
beneficial owner of, each Mortgage Loan free and clear of any pledge, lien,
encumbrance or security interest and has full right and authority, subject to no
interest or participation of, or agreement with, any other party to sell and
assign the same;
(vii) There is no delinquent tax or assessment lien against
any Mortgaged Property;
(viii) There is no valid offset, defense or counterclaim to
any Mortgage Note or Mortgage, including the obligation of the Mortgagor to pay
the unpaid principal of or interest on such Mortgage Note, nor will the
operation of any of the terms of the Mortgage Note and the
-8-
Mortgage, or the exercise of any right thereunder, render the Mortgage
unenforceable, in whole or in part, or subject to any valid right of rescission,
set-off, counterclaim or defense, including the defense of usury and no such
valid right of rescission, set-off, counterclaim or defense has been asserted
with respect thereto;
(ix) There are no mechanics' liens or claims for work, labor
or material rendered to the Mortgaged Property affecting any Mortgaged Property
which are or may be a lien prior to, or equal with, the lien of the related
Mortgage, except those which are insured against by the title insurance policy
referred to in (xiii) below;
(x) Subject to the Escrow Withhold referred to in (xx) below,
each Mortgaged Property is free of material damage and is in good repair;
(xi) Each Mortgage Loan at origination complied in all
material respects with applicable local, state and federal laws and regulations,
including, without limitation, usury, equal credit opportunity, real estate
settlement procedures, truth-in-lending, disclosure laws and all applicable
predatory and abusive lending laws, and consummation of the transactions
contemplated hereby will not involve the violation of any such laws;
(xii) Neither the Seller nor any prior holder of any Mortgage
has modified, impaired or waived the Mortgage in any material respect (except
that a Mortgage Loan may have been modified by a written instrument which has
been recorded, if necessary, to protect the interests of the Purchaser and which
has been delivered to the Trustee); satisfied, canceled or subordinated such
Mortgage in whole or in part; released the related Mortgaged Property in whole
or in part from the lien of such Mortgage; or executed any instrument of
release, cancellation, modification or satisfaction with respect thereto;
(xiii) A lender's policy of title insurance together with a
condominium endorsement, extended coverage endorsement, and an adjustable rate
mortgage endorsement (each as applicable) in an amount at least equal to the
Cut-off Date principal balance of each such Mortgage Loan or a commitment
(binder) to issue the same was effective on the date of the origination of each
Mortgage Loan, each such policy is valid and remains in full force and effect,
the transfer of the related Mortgage Loan to the Purchaser will not affect the
validity or enforceability of such policy and each such policy was issued by a
title insurer qualified to do business in the jurisdiction where the Mortgaged
Property is located and in a form acceptable to Xxxxxx Mae or Xxxxxxx Mac, which
policy insures the Seller and successor owners of indebtedness secured by the
insured Mortgage, as to the first priority lien of the Mortgage; no claims have
been made under such lender's title insurance policy and no prior holder of the
related Mortgage, including the Seller, has done, by act or omission, anything
which would impair the coverage of such lender's title insurance policy;
-9-
(xiv) Each Mortgage Loan was originated by the Seller in
accordance with the underwriting standards (or, if generated by an entity other
than the Seller, in accordance with the underwriting standards set forth in the
Prospectus Supplement or, if generated on behalf of the Seller by a person other
than the Seller, is subject to the same underwriting standards and procedures
used by the Seller in originating mortgage loans directly) or by a savings and
loan association, savings bank, commercial bank, credit union, insurance company
or similar institution which is supervised and examined by a federal or state
authority (including a mortgage broker), or by a mortgagee approved by the
Secretary of Housing and Urban Development pursuant to Sections 203 and 211 of
the National Housing Act;
(xv) With respect to each Adjustable-Rate Mortgage Loan, on
each adjustment date, the Mortgage Rate will be adjusted to equal the Index plus
the Gross Margin, rounded to the nearest 0.125%, subject to the Periodic Rate
Cap, the Maximum Mortgage Rate and the Minimum Mortgage Rate. The related
Mortgage Note is payable on the first day of each month in self-amortizing
monthly installments of principal and interest, with interest payable in
arrears, and requires a monthly payment which is sufficient to fully amortize
the outstanding principal balance of the Mortgage Loan over its remaining term
and to pay interest at the applicable Mortgage Rate. No Mortgage Loan is subject
to negative amortization;
(xvi) All of the improvements which were included for the
purpose of determining the appraised value of the Mortgaged Property lie wholly
within the boundaries and building restriction lines of such property, and no
improvements on adjoining properties encroach upon the Mortgaged Property,
except those, if any, which are insured against by the lender's title insurance
policy referred to in (xiii) above.
(xvii) All inspections, licenses and certificates required to
be made or issued with respect to all occupied portions of the Mortgaged
Property including but not limited to certificates of occupancy, have been made
or obtained from the appropriate authorities and the Mortgaged Property is
lawfully occupied under applicable law except as may otherwise be insured
against by the lender's title insurance policy referred to in (xiii) above.
(xviii) All parties which have had any interest in the
Mortgage, whether as mortgagee, assignee, pledgee or otherwise, are (or, during
the period in which they held and disposed of such interest, were) in compliance
with any and all applicable licensing requirements of the laws of the state
wherein the Mortgaged Property is located;
(xix) The Mortgage Note and the related Mortgage are genuine,
and each is the legal, valid and binding obligation of the maker thereof,
enforceable in accordance with its terms and with applicable laws. All parties
to the Mortgage Note and the Mortgage had legal capacity to execute the Mortgage
Note and the Mortgage and each Mortgage Note and Mortgage have been duly and
properly executed by such parties;
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(xx) The proceeds of each Mortgage Loan have been fully
disbursed, there is no requirement for future advances thereunder and any and
all requirements as to completion of any on-site or off-site improvements and as
to disbursements of any escrow funds therefor have been complied with, except
any Mortgaged Property or Mortgage Loan subject to an Escrow Withhold as defined
in the Originator's underwriting guidelines. All costs, fees and expenses
incurred in making, closing or recording the Mortgage Loans were paid;
(xxi) The related Mortgage contains customary and enforceable
provisions which render the rights and remedies of the holder thereof adequate
for the realization against the Mortgaged Property of the benefits of the
security, including, (i) in the case of a Mortgage designated as a deed of
trust, by trustee's sale, and (ii) otherwise by judicial foreclosure. There is
no homestead or other exemption available to the Mortgagor which would
materially interfere with the right to sell the Mortgaged Property at a
trustee's sale or the right to foreclose the Mortgage;
(xxii) With respect to each Mortgage constituting a deed of
trust, a trustee, duly qualified under applicable law to serve as such, has been
properly designated and currently so serves and is named in such Mortgage, and
no fees or expenses are or will become payable by the Purchaser to the trustee
under the deed of trust, except in connection with a trustee's sale after
default by the Mortgagor;
(xxiii) There exist no deficiencies with respect to escrow
deposits and payments, if such are required, for which customary arrangements
for repayment thereof have not been made, and no escrow deposits or payments of
other charges or payments due the Seller have been capitalized under the
Mortgage or the related Mortgage Note;
(xxiv) The origination, collection and servicing practices
used by the Seller with respect to each Mortgage Loan have been in all material
respects legal, proper, reasonable and customary in the subprime mortgage
origination and servicing business and each of the Mortgage Loans have been
serviced by the Seller since origination;
(xxv) There is no pledged account or other security other than
real estate securing the Mortgagor's obligations;
(xxvi) No Mortgage Loan has a shared appreciation feature, or
other contingent interest feature;
(xxvii) The improvements upon each Mortgaged Property are
covered by a valid, binding and existing hazard insurance policy that is in full
force and effect with a generally acceptable carrier that provides for fire
extended coverage and such other hazards as are customary in the area where the
Mortgaged Property is located representing coverage not less than the lesser of
the outstanding principal balance of the related Mortgage Loan or the minimum
amount required to compensate for damage or loss on a replacement cost basis.
All individual insurance policies and
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flood policies referred to in clause (xxviii) below contain a standard mortgagee
clause naming the Seller or the original mortgagee, and its successors in
interest, as mortgagee, and the Seller has received no notice that any premiums
due and payable thereon have not been paid; the Mortgage obligates the Mortgagor
thereunder to maintain all such insurance, including flood insurance, at the
Mortgagor's cost and expense, and upon the Mortgagor's failure to do so,
authorizes the holder of the Mortgage to obtain and maintain such insurance at
the Mortgagor's cost and expense and to seek reimbursement therefor from the
Mortgagor, except as may be limited or restricted by applicable law;
(xxviii) If the Mortgaged Property is in an area identified in
the Federal Register by the Federal Emergency Management Agency as having
special flood hazards, a valid and binding flood insurance policy that is in
full force and effect in a form meeting the requirements of the current
guidelines of the Flood Insurance Administration is in effect with respect to
such Mortgaged Property with a generally acceptable carrier in an amount
representing coverage not less than the least of (A) the original outstanding
principal balance of the Mortgage Loan, (B) the minimum amount required to
compensate for damage or loss on a replacement cost basis or (C) the maximum
amount of insurance that is available under the Flood Disaster Protection Act of
1973;
(xxix) There is no default, breach, violation or event of
acceleration existing under the Mortgage or the related Mortgage Note; and the
Seller has not waived any default, breach, violation or event of acceleration;
(xxx) Each Mortgaged Property is improved by a one- to
four-family residential dwelling, including condominium units and dwelling units
in planned unit developments, which does not include (a) cooperatives or (b)
mobile homes and manufactured homes (as defined in the Xxxxxx Xxx
Seller-Servicer's Guide), except when the appraisal indicates that (i) the
mobile or manufactured home was built under the Federal Manufactured Home
Construction and Safety Standards of 1976 or (ii) otherwise assumes the
characteristics of site-built housing and meets local building codes, is readily
marketable, has been permanently affixed to the site, is not in a mobile home
"park," and is treated as real property under the applicable state law. With
respect to any Mortgage Loan that is secured by a leasehold estate, (a) the
lease is valid, in full force and effect; (b) all rents and other payments due
under the lease have been paid; (c) the lessee is not in default under any
provision of the lease; (d) the term of the lease exceeds the maturity date of
the related Mortgage Loan by at least five years and (e) the Mortgagee under the
Mortgage Loan is given notice and an opportunity to cure any defaults under the
lease;
(xxxi) There is no obligation on the part of the Seller or any
other party under the terms of the Mortgage or related Mortgage Note to make
payments in lieu of or in addition to those made by the Mortgagor;
(xxxii) Any future advances made prior to the Cut-off Date
have been consolidated with the outstanding principal amount secured by the
Mortgage, and the secured
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principal amount, as consolidated, bears a single interest rate and single
repayment term reflected on the Mortgage Loan Schedule. The consolidated
principal amount does not exceed the original principal amount of the Mortgage
Loan;
(xxxiii) Each Mortgage Loan was either underwritten in
accordance with the Seller's underwriting guidelines as set forth in the
Prospectus Supplement or in accordance with the underwriting guidelines as set
forth in the Prospectus Supplement;
(xxxiv) The Mortgage File contains an appraisal which was
performed by an appraiser who satisfied, and which was conducted in accordance
with, all of the applicable requirements of the Financial Institutions Reform,
Recovery and Enforcement Act of 1989, as amended;
(xxxv) None of the Mortgage Loans is a graduated payment
mortgage loan, nor is any Mortgage Loan subject to a temporary buydown or
similar arrangement;
(xxxvi) No Mortgagor has currently requested any relief under
the Servicemembers Civil Relief Act or similar state laws;
(xxxvii) The Mortgage Loans comply in all material respects
with the description set forth under the heading "The Mortgage Pool" and Annex
III in the Depositor's Prospectus Supplement, dated April 30, 2004 (the
"Prospectus Supplement");
(xxxviii) The Mortgage contains an enforceable provision for
the acceleration of the payment of the unpaid principal balance of the Mortgage
Loan in the event that the Mortgaged Property is sold or transferred without the
prior written consent of the mortgagee thereunder, except as may be limited by
applicable law;
(xxxix) The information set forth in the Prepayment Charge
Schedule attached as Schedule 2 to the Pooling and Servicing Agreement
(including the prepayment charge summary attached thereto) is complete, true and
correct in all material respects at the date or dates respecting which such
information is furnished and each Prepayment Charge is permissible and
enforceable in accordance with its terms upon the full and voluntary prepayment
by the Mortgagor under applicable law and complied in all material respects with
applicable local, state and federal laws (except to the extent that (i) the
enforceability thereof may be limited by bankruptcy, insolvency, moratorium,
receivership and other similar laws relating to creditors' rights generally and
(ii) the collectability thereof may be limited due to acceleration in connection
with a foreclosure or other involuntary payoff);
(xl) Each Mortgage Loan is an obligation that is principally
secured by real property for purposes of the REMIC Provisions of the Code;
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(xli) The Mortgage Loans are not subject to the requirements
of the Home Ownership and Equity Protection Act of 1994 ("HOEPA") and no
Mortgage Loan is subject to, or in violation of, any applicable state or local
law, ordinance or regulation similar to HOEPA.
(xlii) (a) No Mortgage Loan is a High Cost Loan as defined by
HOEPA or any other applicable predatory or abusive lending laws and (b) no
mortgage loan in the Trust is a "high cost home", "covered" (excluding home
loans defined as "covered home loans" pursuant to clause (1) of the definition
of that term in the New Jersey Home Ownership Security Act of 2002), "high risk
home" or "predatory" loan under any other applicable state, federal or local law
(or a similarly classified loan using different terminology under a law imposing
heightened regulatory scrutiny or additional legal liability for resident
mortgage loans having high interest rates, points and/or fees);
(xliii) No subprime Mortgage Loan originated on or after
October 1, 2002 underlying the Certificates will impose a Prepayment Charge for
a term in excess of three years. Any Mortgage Loans originated prior to such
date, and any non-subprime loans, will not impose a Prepayment Charge for a term
in excess of five years;
(xliv) No Mortgage Loan that is secured by property located in
the State of Georgia is either a "Covered Loan" or "High Cost Home Loan" within
the meaning of the Georgia Fair Lending Act, as amended (the "Georgia Act");
(xlv) The Mortgage Loans in the rated pools are not High-Cost
Home Loans under the New Jersey Home Ownership Security Act of 2002 (the "New
Jersey Act") effective November 27, 2003;
(xlvi) No Mortgage Loan in the transaction originated in the
City of Oakland is subject to the City of Oakland California Ordinance 12361 as
a home loan;
(xlvii) No Mortgage Loan, except as identified in detail to
the Rating Agencies, is a Section 10 mortgage under the Oklahoma Home Ownership
and Equity Protection Act (Oklahoma House Xxxx 1574);
(xlviii) No Mortgage Loan is a "High-Cost Home Loan" as
defined in the New Mexico Home Loan Protection Act, effective January 1, 2004;
(xlix) The Master Servicer for each Mortgage Loan underlying
the Certificates has fully furnished, in accordance with the Fair Credit
Reporting Act and its implementing regulations, accurate and complete
information (e.g., favorable and unfavorable) on its borrower credit files to
Equifax, Experian and Trans Union Credit Information Company or their successors
(the "Credit Repositories") on a monthly basis;
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(l) There is no Mortgage Loan in the Trust that was originated
on or after October 1, 2002 and before March 7, 2003, which is secured by
property located in the State of Georgia;
(li) No Mortgage Loan is a " High-Risk Home Loan" as defined
in the Illinois High Risk Home Loan Act 93-561, effective January 1, 2004;
(lii) The Prepayment Charges included in the transaction are
enforceable and originated in compliance with all applicable federal, state and
local law;
(liii) No proceeds from any Mortgage Loan underlying the
Security were used to finance single-premium credit insurance policies;
(liv) No Mortgage Loan is a "High-Cost Home Loan" as defined
under Kentucky State Statute KRS 360.100, effective as of June 25, 2003;
(lv) No Mortgage Loan is a "High-Cost Home Loan" as defined
under the Arkansas Home Loan Protection Act, effective as of July 14, 2003;
(lvi) No Mortgage Loan is a "High-Cost Home Loan" as defined
under the Maine House Xxxx 383 X.X. 494, effective September 13, 2003;
(lvii) No Mortgage Loan in the transaction originated in the
City of Los Angeles is subject to the City of Los Angeles California Ordinance
175008 as a home loan; and
(lviii) No Mortgage Loan is a "Nevada Home Loan" as defined
under the Nevada Assembly Xxxx No. 284, effective as of October 1, 2003, and the
Nevada Home Loans comply with all applicable laws.
SECTION 7. Repurchase Obligation for Defective Documentation and for
Breach of Representation and Warranty.
(a) The representations and warranties contained in Section 6 shall
not be impaired by any review and examination of loan files or other documents
evidencing or relating to the Mortgage Loans or any failure on the part of the
Purchaser to review or examine such documents and shall inure to the benefit of
any assignee, transferee or designee of the Purchaser, including the Trustee for
the benefit of the Certificateholders.
Upon discovery by the Seller, the Purchaser or any assignee,
transferee or designee of the Purchaser of any materially defective document in,
or that any material document was not transferred by the Seller (as listed on
the Trustee's Preliminary Exception Report), as part of, any Mortgage File or of
a breach of any of the representations and warranties contained in Section 5 or
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Section 6 that materially and adversely affects the value of any Mortgage Loan
or the interest therein of the Purchaser or the Purchaser's assignee, transferee
or designee (it being understood that with respect to the representations and
warranties set forth in (xli), (xlii), (xliii), (xliv), (xlix), (l) and (liii)
of Section 6 herein, a breach of any such representation or warranty shall in
and of itself be deemed to materially adversely affect the interest therein of
the Purchaser and the Purchaser's assignee, transferee or designee), the party
discovering the breach shall give prompt written notice to the other. Within
ninety (90) days of its discovery or its receipt of notice of any such missing
documentation which was not transferred to the Purchaser as described above or
materially defective documentation or any such breach of a representation and
warranty (it being understood that with respect to the representations and
warranties set forth in (xli), (xlii), (xliii), (xliv), (xlix), (l) and (liii)
of Section 6 herein, a breach of any such representation or warranty shall in
and of itself be deemed to materially adversely affect the interest therein of
the Purchaser and the Purchaser's assignee, transferee or designee), the Seller
promptly shall deliver such missing document or cure such defect or breach in
all material respects, or in the event the Seller cannot deliver such missing
document or such defect or breach cannot be cured, the Seller shall, within 90
days of its discovery or receipt of notice, either (i) repurchase the affected
Mortgage Loan at a price equal to the Purchase Price or (ii) pursuant to the
provisions of the Pooling and Servicing Agreement, cause the removal of such
Mortgage Loan from the Trust Fund and substitute one or more Qualified
Substitute Mortgage Loans. In the event that any Mortgage Loan is subject to a
breach of the representation and warranty in Section 6(xxxix) resulting in the
Master Servicer's inability to collect all or part of the Prepayment Charge from
the Mortgagor, in lieu of repurchase, the Seller shall be obligated to remit to
the Master Servicer (for deposit in the Collection Account) any shortfall in the
Prepayment Charge collected upon the Mortgagor's voluntary Principal Prepayment.
Notwithstanding the foregoing, within 90 days of the earlier of
discovery by the Seller or receipt of notice by the Seller of the breach of the
representation of the Seller set forth in Section 6(xxxix) above which
materially and adversely affects the interests of the Holders of the Class P
Certificates in any Prepayment Charge, the Seller shall pay the amount of the
scheduled Prepayment Charge, for the benefit of the Holders of the Class P
Certificates, by depositing such amount into the Collection Account, net of any
amount previously collected by the Master Servicer and paid by the Master
Servicer, for the benefit of the Holders of the Class P Certificates, in respect
of such Prepayment Charge.
The Seller shall amend the Closing Schedule to reflect the
withdrawal of such Mortgage Loan from the terms of this Agreement and the
Pooling and Servicing Agreement and the addition, if any, of a Qualified
Substitute Mortgage Loan. The Seller shall deliver to the Purchaser such amended
Closing Schedule and shall deliver such other documents as are required by this
Agreement or the Pooling and Servicing Agreement within five (5) days of any
such amendment. Any repurchase pursuant to this Section 7(a) shall be
accomplished by deposit in the Collection Account of the amount of the Purchase
Price in accordance with Section 2.03 of the Pooling and Servicing Agreement.
Any repurchase or substitution required by this Section shall be made in a
manner consistent with Section 2.03 of the Pooling and Servicing Agreement.
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In addition, upon discovery by the Seller, the Purchaser, or any
assignee, transferee or designee of the Purchaser that any Mortgage Loan does
not constitute a "qualified mortgage" within the meaning of Section 860G(a)(3)
of the Code, the party discovering the breach shall give prompt written notice
within five Business Days to the others. Within ninety (90) days of its
discovery or its receipt of notice, the Seller promptly shall either (i)
repurchase the affected Mortgage Loan at the Purchase Price (as such term is
defined in the Pooling and Servicing Agreement) or (ii) pursuant to the
provisions of the Pooling and Servicing Agreement, cause the removal of such
Mortgage Loan from the Trust Fund and substitute one or more Qualified
Substitute Mortgage Loans.
(b) It is understood and agreed that the obligations of the Seller
set forth in this Section 7 to cure, remit a Prepayment Charge shortfall,
repurchase or substitute for a defective Mortgage Loan constitute the sole
remedies of the Purchaser against the Seller respecting a missing or defective
material document or a breach of the representations and warranties contained in
Section 5 or Section 6.
SECTION 8. Closing; Payment for the Mortgage Loans. The closing of
the purchase and sale of the Mortgage Loans shall be held at the New York City
office of Xxxxxxx Xxxxxxxx & Xxxx LLP at 10:00 AM New York City time on the
Closing Date.
The closing shall be subject to each of the following conditions:
(a) All of the representations and warranties of the Seller under
this Agreement shall be true and correct in all material
respects as of the date as of which they are made and no event
shall have occurred which, with notice or the passage of time,
would constitute a default under this Agreement;
(b) The Purchaser shall have received, or the attorneys of the
Purchaser shall have received in escrow (to be released from
escrow at the time of closing), all Closing Documents as
specified in Section 9 of this Agreement, in such forms as are
agreed upon and acceptable to the Purchaser, duly executed by
all signatories other than the Purchaser as required pursuant
to the respective terms thereof;
(c) The Seller shall have delivered or caused to be delivered and
released to the Purchaser or to its designee, all documents
(including without limitation, the Mortgage Loans) required to
be so delivered by the Purchaser pursuant to Section 2.01 of
the Pooling and Servicing Agreement; and
(d) All other terms and conditions of this Agreement shall have
been complied with.
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Subject to the foregoing conditions, the Purchaser shall deliver or
cause to be delivered to the Seller on the Closing Date, against delivery and
release by the Seller to the Trustee of all documents required pursuant to the
Pooling and Servicing Agreement, the consideration for the Mortgage Loans as
specified in Section 3 of this Agreement, by delivery to the Seller of the
purchase price.
SECTION 9. Closing Documents. Without limiting the generality of
Section 8 hereof, the closing shall be subject to delivery of each of the
following documents:
(a) (i) An Officers' Certificate of the Seller and Master
Servicer, dated the Closing Date, in form satisfactory to and
upon which the Purchaser and the Underwriters may rely, and
attached thereto copies of the certificate of incorporation,
by-laws and certificate of good standing of the Seller and
Master Servicer under the laws of Delaware and stating that
the information contained in the Prospectus Supplement,
relating to the Mortgage Loans, the Seller and Master
Servicer, and its loan portfolio, is true and accurate in all
material respects and does not contain any untrue statement of
a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not
misleading;
(b) An Officers' Certificate of the Seller, dated the Closing
Date, in form satisfactory to and upon which the Purchaser and
the Underwriters may rely, with respect to certain facts
regarding the sale of the Mortgage Loans by the Seller to the
Purchaser;
(c) An Opinion of Counsel of the Seller and Master Servicer, dated
the Closing Date, in form satisfactory to and addressed to the
Purchaser and the Underwriters;
(d) Such opinions of counsel from the Purchaser's or Seller's
counsel as the Rating Agencies may request in connection with
the sale of the Mortgage Loans by the Seller to the Purchaser
or the Seller's execution and delivery of, or performance
under, this Agreement and upon which the Underwriters may
rely;
(e) A letter from Deloitte & Touche LLP, certified public
accountants, dated the date hereof and to the effect that they
have performed certain specified procedures as a result of
which they determined that certain information of an
accounting, financial or statistical nature set forth in the
Prospectus Supplement, under the captions "Summary of
Prospectus Supplement", "Risk Factors", "The Mortgage Pool",
"Yield on the Certificates", "Description of
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the Certificates", "Pooling and Servicing Agreement--The
Seller and Master Servicer", Annex II and Annex III;
(f) The Seller and Master Servicer shall deliver for inclusion in
the Prospectus Supplement under the captions "The Mortgage
Pool--Underwriting Standards of the Originators" and "Pooling
and Servicing Agreement--The Seller and the Master Servicer"
or for inclusion in other offering material such publicly
available information regarding its financial condition and
its mortgage loan delinquency, foreclosure and loss
experience, underwriting standards, lending activities and
loan sales, production, and servicing and collection
practices, and any similar nonpublic, unaudited financial
information; and
(g) Such further information, certificates, opinions and documents
as the Purchaser or the Underwriters may reasonably request.
SECTION 10. Costs. The Seller shall pay (or shall reimburse the
Purchaser or any other Person to the extent that the Purchaser or such other
Person shall pay) all costs and expenses incurred in connection with the
transfer and delivery of the Mortgage Loans, including without limitation,
assignment of mortgage recording costs and/or fees for title policy endorsements
and continuations, the fees and expenses of the Seller's in-house accountants
and in-house attorneys, the costs and expenses incurred in connection with
producing the Seller's loan loss, foreclosure and delinquency experience, and
the costs and expenses incurred in connection with obtaining the documents
referred to in Sections 9(d) and 9(e) to the extent such costs and expenses were
not previously paid by the Seller. The Seller shall pay (or shall reimburse the
Purchaser or any other Person to the extent that the Purchaser or such other
Person shall pay) the costs and expenses of printing (or otherwise reproducing)
and delivering this Agreement, the Pooling and Servicing Agreement, the
Certificates, the prospectus and the prospectus supplement relating to the
Certificates and other related documents, the initial fees, costs and expenses
of the Trustee relating to the issuance of the initial certification of the
Trustee under Section 2.02 of the Pooling and Servicing Agreement, the fees and
expenses of the Seller's counsel in connection with the preparation of all
documents relating to the securitization of the Mortgage Loans, the filing fee
charged by the Securities and Exchange Commission for registration of the
Certificates, the cost of outside special counsel that may be required for the
Purchaser, the cost of obtaining the documents referred to in Section 9(g) and
the fees charged by any rating agency to rate the Certificates. All other costs
and expenses in connection with the transactions contemplated hereunder shall be
borne by the party incurring such expense.
SECTION 11. [Reserved].
SECTION 12. [Reserved].
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SECTION 13. Mandatory Delivery; Grant of Security Interest. The sale
and delivery on the Closing Date of the Mortgage Loans described on the Mortgage
Loan Schedule in accordance with the terms and conditions of this Agreement is
mandatory. It is specifically understood and agreed that each Mortgage Loan is
unique and identifiable on the date hereof and that an award of money damages
would be insufficient to compensate the Purchaser for the losses and damages
incurred by the Purchaser in the event of the Seller's failure to deliver the
Mortgage Loans on or before the Closing Date. The Seller hereby grants to the
Purchaser a lien on and a continuing security interest in the Seller's interest
in each Mortgage Loan and each document and instrument evidencing each such
Mortgage Loan to secure the performance by the Seller of its obligation
hereunder, and the Seller agrees that it holds such Mortgage Loans in custody
for the Purchaser, subject to the Purchaser's (i) right, prior to the Closing
Date, to reject any Mortgage Loan to the extent permitted by this Agreement, and
(ii) obligation to deliver or cause to be delivered the consideration for the
Mortgage Loans pursuant to Section 8 hereof. Any Mortgage Loans rejected by the
Purchaser shall concurrently therewith be released from the security interest
created hereby. The Seller agrees that, upon acceptance of the Mortgage Loans by
the Purchaser or its designee and delivery of payment to the Seller, that its
security interest in the Mortgage Loans shall be released. All rights and
remedies of the Purchaser under this Agreement are distinct from, and cumulative
with, any other rights or remedies under this Agreement or afforded by law or
equity and all such rights and remedies may be exercised concurrently,
independently or successively.
Notwithstanding the foregoing, if on the Closing Date, each of the
conditions set forth in Section 8 hereof shall have been satisfied and the
Purchaser shall not have paid or caused to be paid the purchase price, or any
such condition shall not have been waived or satisfied and the Purchaser
determines not to pay or cause to be paid the purchase price, the Purchaser
shall immediately effect the redelivery of the Mortgage Loans, if delivery to
the Purchaser has occurred and the security interest created by this Section 13
shall be deemed to have been released.
SECTION 14. Notices. All demands, notices and communications
hereunder shall be in writing and shall be deemed to have been duly given if
personally delivered to or mailed by registered mail, postage prepaid, or
transmitted by telex or telegraph and confirmed by a similar mailed writing, if
to the Purchaser, addressed to the Purchaser at 0000 Xxxx & Xxxxxxx Xxxx, Xxxxx
0000, Xxxxxx, Xxxxxxxxxx 00000, Facsimile: (000) 000-0000, Attention: General
Counsel, or such other address as may hereafter be furnished to the Seller in
writing by the Purchaser; if to the Seller, addressed to the Seller at 0000 Xxxx
& Xxxxxxx Xxxx, Xxxxx 0000, Xxxxxx, Xxxxxxxxxx 00000, Facsimile: (000) 000-0000,
Attention: General Counsel, or to such other address as the Seller may designate
in writing to the Purchaser.
SECTION 15. Severability of Provisions. Any part, provision,
representation or warranty of this Agreement which is prohibited or which is
held to be void or unenforceable shall be ineffective to the extent of such
prohibition or unenforceability without invalidating the remaining provisions
hereof. Any part, provision, representation or warranty of this Agreement which
is prohibited or unenforceable or is held to be void or unenforceable in any
jurisdiction shall, as to such
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jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction as to any Mortgage Loan
shall not invalidate or render unenforceable such provision in any other
jurisdiction. To the extent permitted by applicable law, the parties hereto
waive any provision of law which prohibits or renders void or unenforceable any
provision hereof.
SECTION 16. Agreement of Parties. The Seller and the Purchaser agree
to execute and deliver such instruments and take such actions as either of the
others may, from time to time, reasonably request in order to effectuate the
purpose and to carry out the terms of this Agreement and the Pooling and
Servicing Agreement.
SECTION 17. Survival. The Seller agrees that the representations,
warranties and agreements made by it herein and in any certificate or other
instrument delivered pursuant hereto shall be deemed to be relied upon by the
Purchaser, notwithstanding any investigation heretofore or hereafter made by the
Purchaser or on its behalf, and that the representations, warranties and
agreements made by the Seller herein or in any such certificate or other
instrument shall survive the delivery of and payment for the Mortgage Loans and
shall continue in full force and effect, notwithstanding any restrictive or
qualified endorsement on the Mortgage Notes and notwithstanding subsequent
termination of this Agreement, the Pooling and Servicing Agreement or the Trust
Fund.
SECTION 18. GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS, DUTIES,
OBLIGATIONS AND RESPONSIBILITIES OF THE PARTIES HERETO SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS (EXCLUDING THE CHOICE OF LAW PROVISIONS)
AND DECISIONS OF THE STATE OF NEW YORK. THE PARTIES HERETO INTEND THAT THE
PROVISIONS OF SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW SHALL APPLY
TO THIS AGREEMENT.
SECTION 19. Miscellaneous. This Agreement may be executed in two or
more counterparts, each of which when so executed and delivered shall be an
original, but all of which together shall constitute one and the same
instrument. This Agreement shall inure to the benefit of and be binding upon the
parties hereto and their respective successors and assigns. This Agreement
supersedes all prior agreements and understandings relating to the subject
matter hereof. Neither this Agreement nor any term hereof may be changed,
waived, discharged or terminated orally, but only by an instrument in writing
signed by the party against whom enforcement of the change, waiver, discharge or
termination is sought. The headings in this Agreement are for purposes of
reference only and shall not limit or otherwise affect the meaning hereof. The
NIMS Insurer, if any, shall be a third party beneficiary hereof and may enforce
the terms hereof as if a party hereto.
It is the express intent of the parties hereto that the conveyance
of the Mortgage Loans by the Seller to the Purchaser as provided in Section 4
hereof be, and be construed as, a sale of the Mortgage Loans by the Seller to
the Purchaser and not as a pledge of the Mortgage Loans by the
-21-
Seller to the Purchaser to secure a debt or other obligation of the Seller.
However, in the event that, notwithstanding the aforementioned intent of the
parties, the Mortgage Loans are held to be property of the Seller, then, (a) it
is the express intent of the parties that such conveyance be deemed a pledge of
the Mortgage Loans by the Seller to the Purchaser to secure a debt or other
obligation of the Seller and (b) (1) this Agreement shall also be deemed to be a
security agreement within the meaning of Articles 8 and 9 of the New York
Uniform Commercial Code; (2) the conveyance provided for in Section 4 hereof
shall be deemed to be a grant by the Seller to the Purchaser of a security
interest in all of the Seller's right, title and interest in and to the Mortgage
Loans and all amounts payable to the holders of the Mortgage Loans in accordance
with the terms thereof and all proceeds of the conversion, voluntary or
involuntary, of the foregoing into cash, instruments, securities or other
property, including without limitation all amounts, other than investment
earnings, from time to time held or invested in the Collection Account whether
in the form of cash, instruments, securities or other property; (3) the
possession by the Purchaser or its agent of Mortgage Notes, the related
Mortgages and such other items of property that constitute instruments, money,
negotiable documents or chattel paper shall be deemed to be "possession" for
purposes of perfecting the security interest pursuant to the New York Uniform
Commercial Code; and (4) notifications to persons holding such property, and
acknowledgments, receipts or confirmations from persons holding such property,
shall be deemed notifications to, or acknowledgments, receipts or confirmations
from, financial intermediaries, bailees or agents (as applicable) of the
Purchaser for the purpose of perfecting such security interest under applicable
law. Any assignment of the interest of the Purchaser pursuant to Section 4(d)
hereof shall also be deemed to be an assignment of any security interest created
hereby. The Seller and the Purchaser shall, to the extent consistent with this
Agreement, take such actions as may be necessary to ensure that, if this
Agreement were deemed to create a security interest in the Mortgage Loans, such
security interest would be deemed to be a perfected security interest of first
priority under applicable law and will be maintained as such throughout the term
of this Agreement and the Pooling and Servicing Agreement.
IN WITNESS WHEREOF, the Seller and the Purchaser have caused their
names to be signed by their respective officers thereunto duly authorized as of
the date first above written.
AMERIQUEST MORTGAGE COMPANY
By:_________________________________
Name:
Title:
ARGENT SECURITIES INC.
By:_________________________________
Name:
Title:
EXHIBIT E
REQUEST FOR RELEASE OF DOCUMENTS
To: Deutsche Bank National Trust Company,
0000 Xxxx Xx. Xxxxxx Xxxxx
Xxxxx Xxx, XX 00000-0000
Attn: Trust Administration - [____]
Re: Pooling and Servicing Agreement dated as of May 1, 2004 among Argent
Securities Inc., as depositor, Ameriquest Mortgage Company, as
master servicer, and Deutsche - Bank National Trust Company, as
Trustee
In connection with the administration of the Mortgage Loans held by
you as Trustee pursuant to the above-captioned Trustee Agreement, we
request the release, and hereby acknowledge receipt, of the
Trustee's Mortgage File for the Mortgage Loan described below, for
the reason indicated.
Mortgage Loan Number:
Mortgagor Name. Address & Zip Code:
Reason for Requesting Documents (check one):
_________1. Mortgage Paid in Full
_________2. Foreclosure
_________3. Substitution
_________4. Other Liquidation (Repurchases, etc.)
_________5. Nonliquidation Reason:________________
Address to which Trustee should deliver
the Trustee's Mortgage File:
_________________________________________
_________________________________________
E-1
By:__________________________________
(authorized signer)
Issuer:______________________________
Address:_____________________________
Date:________________________________
Trustee
Deutsche Bank National Trust Company
Please acknowledge the execution of the above request by your signature
and date below:
________________________________ ________________________________
Signature Date
Documents returned to Trustee:
________________________________ ________________________________
Trustee Date
E-2
EXHIBIT F-1
FORM OF TRANSFEROR REPRESENTATION LETTER
[DATED]
Deutsche Bank National Trust Company
0000 Xxxx Xx. Xxxxxx Xxxxx
Xxxxx Xxx, Xxxxxxxxxx 00000-0000
Re: Argent Securities Inc., Asset-Backed Pass-Through
Certificates, Series 2004-W7, Class [M-7] [M-8] [M-9] [M-10]
[CE] [P] [R] [R-X], [representing a ______% Percentage
Interest] [with an aggregate Certificate Principal Balance
of _____] [with a Notional Amount of ______]
Ladies and Gentlemen:
In connection with the transfer by ________________ (the
"Transferor") to ________________ (the "Transferee") of the captioned
asset-backed pass-through certificates (the "Certificates"), the Transferor
hereby certifies as follows:
Neither the Transferor nor anyone acting on its behalf has (a)
offered, pledged, sold, disposed of or otherwise transferred any Certificate,
any interest in any Certificate or any other similar security to any person in
any manner, (b) has solicited any offer to buy or to accept a pledge,
disposition or other transfer of any Certificate, any interest in any
Certificate or any other similar security from any person in any manner, (c) has
otherwise approached or negotiated with respect to any Certificate, any interest
in any Certificate or any other similar security with any person in any manner,
(d) has made any general solicitation by means of general advertising or in any
other manner, (e) has taken any other action, that (in the case of each of
subclauses (a) through (e) above) would constitute a distribution of the
Certificates under the Securities Act of 1933, as amended (the "1933 Act"), or
would render the disposition of any Certificate a violation of Section 5 of the
1933 Act or any state securities law or would require registration or
qualification pursuant thereto. The Transferor will not act, nor has it
authorized or will it authorize any person to act, in any manner set forth in
the foregoing sentence with respect to any Certificate. The Transferor will not
sell or otherwise transfer any of the Certificates, except in compliance with
the provisions of that certain Pooling and Servicing Agreement, dated as of May
1, 2004, among Argent Securities Inc. as Depositor, Ameriquest Mortgage Company
as Master Servicer and Deutsche Bank National Trust Company as Trustee (the
"Pooling and Servicing Agreement"), pursuant to which Pooling and Servicing
Agreement the Certificates were issued.
F-1-1
Capitalized terms used but not defined herein shall have the
meanings assigned thereto in the Pooling and Servicing Agreement.
Very truly yours,
[Transferor]
By:______________________________
Name:
Title:
F-1-2
FORM OF TRANSFEREE REPRESENTATION LETTER
[Date]
Deutsche Bank National Trust Company
0000 Xxxx Xx. Xxxxxx Xxxxx
Xxxxx Xxx, Xxxxxxxxxx 00000-0000
Re: Argent Securities Inc., Asset-Backed Pass-Through
Certificates, Series 2004-W7 Class [M-7] [M-8] [M-9] [M-10]
[CE] [P] [R] [R- X], [representing a _________% Percentage
Interest] [with an aggregate Certificate Principal Balance
of _____] [with a Notional Amount of ______]
Ladies and Gentlemen:
In connection with the purchase from ______________________ (the
"Transferor") on the date hereof of the captioned trust certificates (the
"Certificates"), _______________ (the "Transferee") hereby certifies as follows:
1. The Transferee is a "qualified institutional buyer" as that term
is defined in Rule 144A ("Rule 144A") under the Securities Act of 1933
(the "1933 Act") and has completed either of the forms of certification to
that effect attached hereto as Annex 1 or Annex 2. The Transferee is aware
that the sale to it is being made in reliance on Rule 144A. The Transferee
is acquiring the Certificates for its own account or for the account of a
qualified institutional buyer, and understands that such Certificate may
be resold, pledged or transferred only (i) to a person reasonably believed
to be a qualified institutional buyer that purchases for its own account
or for the account of a qualified institutional buyer to whom notice is
given that the resale, pledge or transfer is being made in reliance on
Rule 144A, or (ii) pursuant to another exemption from registration under
the 1933 Act.
2. The Transferee has been furnished with all information regarding
(a) the Certificates and distributions thereon, (b) the nature,
performance and servicing of the Mortgage Loans, (c) the Pooling and
Servicing Agreement referred to below, and (d) any credit enhancement
mechanism associated with the Certificates, that it has requested.
All capitalized terms used but not otherwise defined herein have the
respective meanings assigned thereto in the Pooling and Servicing Agreement,
dated as of May 1, 2004, among Argent Securities Inc. as Depositor, Ameriquest
Mortgage Company as Master Servicer and Deutsche Bank National Trust Company as
Trustee, pursuant to which the Certificates were issued.
[TRANSFEREE]
By: ______________________________
Name:
Title:
F-1-3
ANNEX 1 TO EXHIBIT F-1
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees Other Than Registered Investment Companies]
The undersigned hereby certifies as follows to [name of Transferor]
(the "Transferor") and Deutsche Bank National Trust Company as Trustee, with
respect to the asset-backed pass- through certificates (the "Certificates")
described in the Transferee Certificate to which this certification relates and
to which this certification is an Annex:
1. As indicated below, the undersigned is the President, Chief
Financial Officer, Senior Vice President or other executive officer of the
entity purchasing the Certificates (the "Transferee").
2. In connection with purchases by the Transferee, the Transferee is
a "qualified institutional buyer" as that term is defined in Rule 144A under the
Securities Act of 1933 ("Rule 144A") because (i) the Transferee owned and/or
invested on a discretionary basis $______________________ in securities (except
for the excluded securities referred to below) as of the end of the Transferee's
most recent fiscal year (such amount being calculated in accordance with Rule
144A) and (ii) the Transferee satisfies the criteria in the category marked
below.
___ Corporation, Etc. The Transferee is a corporation (other than a
bank, savings and loan association or similar institution),
Massachusetts or similar business trust, partnership, or any
organization described in Section 501(c)(3) of the Internal Revenue
Code of 1986.
___ Bank. The Transferee (a) is a national bank or banking institution
organized under the laws of any State, territory or the District of
Columbia, the business of which is substantially confined to banking
and is supervised by the State or territorial banking commission or
similar official or is a foreign bank or equivalent institution, and
(b) has an audited net worth of at least $25,000,000 as demonstrated
in its latest annual financial statements, a copy of which is
attached hereto.
___ Savings and Loan. The Transferee (a) is a savings and loan
association, building and loan association, cooperative bank,
homestead association or similar institution, which is supervised
and examined by a State or Federal authority having supervision over
any such institutions or is a foreign savings and loan association
or equivalent institution and (b) has an audited net worth of at
least 1Transferee must own and/or invest on a discretionary basis at
least $100,000,000 in securities unless Transferee is a dealer, and,
in that case, Transferee must own and/or invest on a discretionary
basis at least $10,000,000 in securities. $25,000,000 as
demonstrated in its latest annual financial statements, a copy of
which is attached hereto.
F-1-4
___ Broker-Dealer. The Transferee is a dealer registered pursuant to
Section 15 of the Securities Exchange Act of 1934.
___ Insurance Company. The Transferee is an insurance company whose
primary and predominant business activity is the writing of
insurance or the reinsuring of risks underwritten by insurance
companies and which is subject to supervision by the insurance
commissioner or a similar official or agency of a State, territory
or the District of Columbia.
___ State or Local Plan. The Transferee is a plan established and
maintained by a State, its political subdivisions, or any agency or
instrumentality of the State or its political subdivisions, for the
benefit of its employees.
___ ERISA Plan. The Transferee is an employee benefit plan within the
meaning of Title I of the Employee Retirement Income Security Act of
1974.
___ Investment Advisor. The Transferee is an investment advisor
registered under the Investment Advisers Act of 1940.
3. The term "Securities" as used herein does not include (i)
securities of issuers that are affiliated with the Transferee, (ii) securities
that are part of an unsold allotment to or subscription by the Transferee, if
the Transferee is a dealer, (iii) securities issued or guaranteed by the U.S. or
any instrumentality thereof, (iv) bank deposit notes and certificates of
deposit, (v) loan participations, (vi) repurchase agreements, (vii) securities
owned but subject to a repurchase agreement and (viii) currency, interest rate
and commodity swaps.
4. For purposes of determining the aggregate amount of securities
owned and/or invested on a discretionary basis by the Transferee, the Transferee
used the cost of such securities to the Transferee and did not include any of
the securities referred to in the preceding paragraph. Further, in determining
such aggregate amount, the Transferee may have included securities owned by
subsidiaries of the Transferee, but only if such subsidiaries are consolidated
with the Transferee in its financial statements prepared in accordance with
generally accepted accounting principles and if the investments of such
subsidiaries are managed under the Transferee's direction. However, such
securities were not included if the Transferee is a majority-owned, consolidated
subsidiary of another enterprise and the Transferee is not itself a reporting
company under the Securities Exchange Act of 1934.
5. The Transferee acknowledges that it is familiar with Rule 144A
and understands that the Transferor and other parties related to the
Certificates are relying and will continue to rely on the statements made herein
because one or more sales to the Transferee may be in reliance on Rule 144A.
_____ _____ Will the Transferee be purchasing the Certificates
Yes No only for the Transferee's own account?
6. If the answer to the foregoing question is "no", the Transferee
agrees that, in connection with any purchase of securities sold to the
Transferee for the account of a third party
F-1-5
(including any separate account) in reliance on Rule 144A, the Transferee will
only purchase for the account of a third party that at the time is a "qualified
institutional buyer" within the meaning of Rule 144A. In addition, the
Transferee agrees that the Transferee will not purchase securities for a third
party unless the Transferee has obtained a current representation letter from
such third party or taken other appropriate steps contemplated by Rule 144A to
conclude that such third party independently meets the definition of "qualified
institutional buyer" set forth in Rule 144A.
7. The Transferee will notify each of the parties to which this
certification is made of any changes in the information and conclusions herein.
Until such notice is given, the Transferee's purchase of the Certificates will
constitute a reaffirmation of this certification as of the date of such
purchase. In addition, if the Transferee is a bank or savings and loan as
provided above, the Transferee agrees that it will furnish to such parties
updated annual financial statements promptly after they become available.
Dated:
Print Name of Transferee
By:_____________________________
Name:
Title:
F-1-6
ANNEX 2 TO EXHIBIT F-1
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees That Are Registered Investment Companies]
The undersigned hereby certifies as follows to [name of Transferor]
(the "Transferor") and Deutsche Bank National Trust Company, as Trustee, with
respect to the asset-backed pass- through certificates (the "Certificates")
described in the Transferee Certificate to which this certification relates and
to which this certification is an Annex:
1. As indicated below, the undersigned is the President, Chief
Financial Officer or Senior Vice President of the entity purchasing the
Certificates (the "Transferee") or, if the Transferee is a "qualified
institutional buyer" as that term is defined in Rule 144A under the Securities
Act of 1933 ("Rule 144A") because the Transferee is part of a Family of
Investment Companies (as defined below), is such an officer of the investment
adviser (the "Adviser").
2. In connection with purchases by the Transferee, the Transferee is
a "qualified institutional buyer" as defined in Rule 144A because (i) the
Transferee is an investment company registered under the Investment Company Act
of 1940, and (ii) as marked below, the Transferee alone, or the Transferee's
Family of Investment Companies, owned at least $100,000,000 in securities (other
than the excluded securities referred to below) as of the end of the
Transferee's most recent fiscal year. For purposes of determining the amount of
securities owned by the Transferee or the Transferee's Family of Investment
Companies, the cost of such securities was used.
____ The Transferee owned $___________________ in securities (other than
the excluded securities referred to below) as of the end of the
Transferee's most recent fiscal year (such amount being calculated
in accordance with Rule 144A).
____ The Transferee is part of a Family of Investment Companies which
owned in the aggregate $______________ in securities (other than the
excluded securities referred to below) as of the end of the
Transferee's most recent fiscal year (such amount being calculated
in accordance with Rule 144A).
3. The term "Family of Investment Companies" as used herein means
two or more registered investment companies (or series thereof) that have the
same investment adviser or investment advisers that are affiliated (by virtue of
being majority owned subsidiaries of the same parent or because one investment
adviser is a majority owned subsidiary of the other).
4. The term "Securities" as used herein does not include (i)
securities of issuers that are affiliated with the Transferee or are part of the
Transferee's Family of Investment Companies, (ii) securities issued or
guaranteed by the U.S. or any instrumentality thereof, (iii) bank deposit notes
and certificates of deposit, (iv) loan participations, (v) repurchase
agreements, (vi) securities owned but subject to a repurchase agreement and
(vii) currency, interest rate and commodity swaps.
F-1-8
5. The Transferee is familiar with Rule 144A and understands that
the parties to which this certification is being made are relying and will
continue to rely on the statements made herein because one or more sales to the
Transferee will be in reliance on Rule 144A. In addition, the Transferee will
only purchase for the Transferee's own account.
6. The undersigned will notify the parties to which this
certification is made of any changes in the information and conclusions herein.
Until such notice, the Transferee's purchase of the Certificates will constitute
a reaffirmation of this certification by the undersigned as of the date of such
purchase.
Dated:
Print Name of Transferee or Advisor
By: _________________________________
Name:
Title:
IF AN ADVISER:
_____________________________________
Print Name of Transferee
F-1-9
FORM OF TRANSFEREE REPRESENTATION LETTER
The undersigned hereby certifies on behalf of the purchaser named below
(the "Purchaser") as follows:
1. I am an executive officer of the Purchaser.
2. The Purchaser is a "qualified institutional buyer", as defined in
Rule 144A, ("Rule 144A") under the Securities Act of 1933, as amended.
3. As of the date specified below (which is not earlier than the
last day of the Purchaser's most recent fiscal year), the amount of
"securities", computed for purposes of Rule 144A, owned and invested on a
discretionary basis by the Purchaser was in excess of $100,000,000.
Name of Purchaser ________________________________________________________
By: (Signature) ________________________________________________________
Name of Signatory ________________________________________________________
Title __________________________________________________________________________
Date of this certificate _______________________________________________________
Date of information provided in paragraph 3 ____________________________________
F-1-10
EXHIBIT F-2
FORM OF TRANSFER AFFIDAVIT AND AGREEMENT
STATE OF NEW YORK )
: ss.:
COUNTY OF NEW YORK )
____________________________, being duly sworn, deposes, represents
and warrants as follows:
1. I am a ______________________ of ____________________________
(the "Owner") a corporation duly organized and existing under the laws of
______________, the record owner of Argent Securities Inc., Asset-Backed
Pass-Through Certificates, Series 2004-W7, Class [R][R-X] (the "Residual
Certificates"), on behalf of whom I make this affidavit and agreement.
Capitalized terms used but not defined herein have the respective meanings
assigned thereto in the Pooling and Servicing Agreement pursuant to which the
Residual Certificates were issued.
2. The Owner (i) is and will be a "Permitted Transferee" as of
____________________, 2004 and (ii) is acquiring the Residual Certificates for
its own account or for the account of another Owner from which it has received
an affidavit in substantially the same form as this affidavit. A "Permitted
Transferee" is any person other than a "disqualified organization" or a
possession of the United States. For this purpose, a "disqualified organization"
means the United States, any state or political subdivision thereof, any agency
or instrumentality of any of the foregoing (other than an instrumentality all of
the activities of which are subject to tax and, except for the Federal Home Loan
Mortgage Corporation, a majority of whose board of directors is not selected by
any such governmental entity) or any foreign government, international
organization or any agency or instrumentality of such foreign government or
organization, any rural electric or telephone cooperative, or any organization
(other than certain farmers' cooperatives) that is generally exempt from federal
income tax unless such organization is subject to the tax on unrelated business
taxable income.
3. The Owner is aware (i) of the tax that would be imposed on
transfers of the Residual Certificates to disqualified organizations under the
Internal Revenue Code of 1986 that applies to all transfers of the Residual
Certificates after March 31, 1988; (ii) that such tax would be on the transferor
or, if such transfer is through an agent (which person includes a broker,
nominee or middleman) for a non-Permitted Transferee, on the agent; (iii) that
the person otherwise liable for the tax shall be relieved of liability for the
tax if the transferee furnishes to such person an affidavit that the transferee
is a Permitted Transferee and, at the time of transfer, such person does not
have actual knowledge that the affidavit is false; and (iv) that each of the
Residual Certificates may be a "noneconomic residual interest" within the
meaning of proposed Treasury regulations promulgated under the Code and that the
transferor of a "noneconomic residual interest" will remain liable for any taxes
due with respect to the income on such residual interest, unless no significant
purpose of the transfer is to impede the assessment or collection of tax.
4. The Owner is aware of the tax imposed on a "pass-through entity"
holding the Residual Certificates if, at any time during the taxable year of the
pass-through entity, a non-
F-2-1
Permitted Transferee is the record holder of an interest in such entity. (For
this purpose, a "pass- through entity" includes a regulated investment company,
a real estate investment trust or common trust fund, a partnership, trust or
estate, and certain cooperatives.)
5. The Owner is aware that the Certificate Registrar will not
register the transfer of any Class R Certificate unless the transferee, or the
transferee's agent, delivers to the Certificate Registrar, among other things,
an affidavit in substantially the same form as this affidavit. The Owner
expressly agrees that it will not consummate any such transfer if it knows or
believes that any of the representations contained in such affidavit and
agreement are false.
6. The Owner consents to any additional restrictions or arrangements
that shall be deemed necessary upon advice of counsel to constitute a reasonable
arrangement to ensure that the Residual Certificates will only be owned,
directly or indirectly, by an Owner that is a Permitted Transferee.
7. The Owner's taxpayer identification number is ____________.
8. The Owner has reviewed the restrictions set forth on the face of
the Residual Certificates and the provisions of Section 5.02(d) of the Pooling
and Servicing Agreement under which the Residual Certificates were issued (in
particular, clauses (iii)(A) and (iii)(B) of Section 5.02(d) which authorize the
Trustee to deliver payments to a person other than the Owner and negotiate a
mandatory sale by the Trustee in the event that the Owner holds such Certificate
in violation of Section 5.02(d)); and that the Owner expressly agrees to be
bound by and to comply with such restrictions and provisions.
9. The Owner is not acquiring and will not transfer the Residual
Certificates in order to impede the assessment or collection of any tax.
10. The Owner anticipates that it will, so long as it holds the
Residual Certificates, have sufficient assets to pay any taxes owed by the
holder of such Residual Certificates, and hereby represents to and for the
benefit of the person from whom it acquired the Residual Certificates that the
Owner intends to pay taxes associated with holding such Residual Certificates as
they become due, fully understanding that it may incur tax liabilities in excess
of any cash flows generated by the Residual Certificates.
11. The Owner has no present knowledge that it may become insolvent
or subject to a bankruptcy proceeding for so long as it holds the Residual
Certificates.
12. The Owner has no present knowledge or expectation that it will
be unable to pay any United States taxes owed by it so long as any of the
Certificates remain outstanding.
13. The Owner is not acquiring the Residual Certificates with the
intent to transfer the Residual Certificates to any person or entity that will
not have sufficient assets to pay any taxes owed by the holder of such Residual
Certificates, or that may become insolvent or subject to a bankruptcy
proceeding, for so long as the Residual Certificates remain outstanding.
F-2-2
14. The Owner will, in connection with any transfer that it makes of
the Residual Certificates, obtain from its transferee the representations
required by Section 5.02(d) of the Pooling and Servicing Agreement under which
the Class R Certificate were issued and will not consummate any such transfer if
it knows, or knows facts that should lead it to believe, that any such
representations are false.
15. The Owner will, in connection with any transfer that it makes of
the Residual Certificates, deliver to the Certificate Registrar an affidavit,
which represents and warrants that it is not transferring the Residual
Certificates to impede the assessment or collection of any tax and that it has
no actual knowledge that the proposed transferee: (i) has insufficient assets to
pay any taxes owed by such transferee as holder of the Residual Certificates;
(ii) may become insolvent or subject to a bankruptcy proceeding for so long as
the Residual Certificates remains outstanding; and (iii) is not a "Permitted
Transferee".
16. The Owner is a citizen or resident of the United States, a
corporation or partnership (or other entity treated as a corporation or
partnership for federal income tax purposes) created or organized in, or under
the laws of, the United States, any state thereof or the District of Columbia
(except, in the case of a partnership or entity treated as a partnership, to the
extent provided in regulations), an estate the income of which is subject to
United States federal income taxation regardless of its source or a trust other
than a "foreign trust" described in section 7701(a)(31) of the Code.
F-2-3
IN WITNESS WHEREOF, the Owner has caused this instrument to be
executed on its behalf, pursuant to the authority of its Board of Directors, by
its [Vice] President, attested by its [Assistant] Secretary, this ____ day of
__________, 200__.
[OWNER]
By:_____________________________
Name:
Title: [Vice] President
ATTEST:
By: ____________________________
Name:
Title:[Assistant] Secretary
Personally appeared before me the above-named , known or proved to
me to be the same person who executed the foregoing instrument and to be a
[Vice] President of the Owner, 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 Owner.
Subscribed and sworn before me this ____ day of __________, 200__.
_______________________________
Notary Public
County of _____________________
State of ______________________
F-2-4
FORM OF TRANSFEROR AFFIDAVIT
STATE OF NEW YORK )
: ss. :
COUNTY OF NEW YORK )
_______________________________________, being duly sworn, deposes,
represents and warrants _____________________________ as follows:
1. I am a ____________________ of (the "Owner"), a corporation duly
organized and existing under the laws of ______________, on behalf of whom I
make this affidavit.
2. The Owner is not transferring the Class [R][R-X] (the "Residual
Certificates") to impede the assessment or collection of any tax.
3. The Owner has no actual knowledge that the Person that is the
proposed transferee (the "Purchaser") of the Residual Certificates: (i) has
insufficient assets to pay any taxes owed by such proposed transferee as holder
of the Residual Certificates; (ii) may become insolvent or subject to a
bankruptcy proceeding for so long as the Residual Certificates remain
outstanding and (iii) is not a Permitted Transferee.
4. The Owner understands that the Purchaser has delivered to the
Certificate Registrar a transfer affidavit and agreement in the form attached to
the Pooling and Servicing Agreement as Exhibit F-2. The Owner does not know or
believe that any representation contained therein is false.
5. At the time of transfer, the Owner has conducted a reasonable
investigation of the financial condition of the Purchaser as contemplated by
Treasury Regulations Section 1.860E- 1(c)(4)(i) and, as a result of that
investigation, the Owner has determined that the Purchaser has historically paid
its debts as they became due and has found no significant evidence to indicate
that the Purchaser will not continue to pay its debts as they become due in the
future. The Owner understands that the transfer of a Residual Certificate may
not be respected for United States income tax purposes (and the Owner may
continue to be liable for United States income taxes associated therewith)
unless the Owner has conducted such an investigation.
6. Capitalized terms not otherwise defined herein shall have the
meanings ascribed to them in the Pooling and Servicing Agreement.
F-2-5
IN WITNESS WHEREOF, the Owner has caused this instrument to be
executed on its behalf, pursuant to the authority of its Board of Directors, by
its [Vice] President, attested by its [Assistant] Secretary, this ____ day of
___________, 200__.
[OWNER]
By: ____________________________
Name:
Title: [Vice] President
ATTEST:
By: ______________________________
Name:
Title: [Assistant] Secretary
Personally appeared before me the above-named , known or proved to
me to be the same person who executed the foregoing instrument and to be a
[Vice] President of the Owner, 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 Owner.
Subscribed and sworn before me this ____ day of __________, 200__.
__________________________________
Notary Public
County of ________________________
State of _________________________
My Commission expires:
F-2-6
EXHIBIT G
FORM OF CERTIFICATION WITH RESPECT TO ERISA AND THE CODE
_____________, 200__
Argent Securities Inc. Deutsche Bank National Trust Company
0000 Xxxx & Xxxxxxx Xxxx 0000 Xxxx Xx. Xxxxxx Xxxxx
Xxxxxx, Xxxxxxxxxx 00000 Xxxxx Xxx, Xxxxxxxxxx 00000-0000
Ameriquest Mortgage Company
0000 Xxxx & Xxxxxxx Xxxx
Xxxxxx, Xxxxxxxxxx 00000
Re: Argent Securities Inc., Asset-Backed Pass-Through
Certificates, Series 2004-W5, Class X-0, X-0, X-0, X-00, XX,
X, X and R-X
Dear Ladies and Gentlemen:
__________________________________ (the "Transferee") intends to
acquire from _____________________ (the "Transferor") [$____________ Initial
Certificate Principal Balance] [$____________ initial Notional Amount] [_____%
Percentage Interest] of Argent Securities Inc., Asset- Backed Pass-Through
Certificates, Series 2004-W7, Class ___ (the "Certificates"), issued pursuant to
a Pooling and Servicing Agreement (the "Pooling and Servicing Agreement") dated
as of May 1, 2004 among Argent Securities Inc. as depositor (the "Depositor"),
Ameriquest Mortgage Company as master servicer (the "Master Servicer") and
Deutsche Bank National Trust Company as trustee (the "Trustee"). Capitalized
terms used herein and not otherwise defined shall have the meanings assigned
thereto in the Pooling and Servicing Agreement. The Transferee hereby certifies,
represents and warrants to, and covenants with the Depositor, the Trustee and
the Master Servicer that the following statements in either (1) or (2) are
accurate:
The Certificates either (A) (i) are not being acquired by, and will
not be transferred to, any employee benefit plan within the meaning of section
3(3) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), or other retirement arrangement, including individual retirement
accounts and annuities, Xxxxx plans and bank collective investment funds and
insurance company general or separate accounts in which such plans, accounts or
arrangements are invested, that is subject to Section 406 of ERISA or Section
4975 of the Internal Revenue Code of 1986 (the "Code") (any of the foregoing, a
"Plan"), (ii) are not being acquired with "plan assets" of a Plan within the
meaning of the Department of Labor ("DOL") regulation, 29 C.F.R. ss. 2510.3-101,
and (iii) will not be transferred to any entity that is deemed to be investing
in plan assets within the meaning of the DOL regulation at 29
C.F.R.ss.2510.3-101 or (B) solely in the case of the Class M-7, Class M-8, Class
M-9 or Class M-10 Certificates, either (i) are not being acquired by, and will
not be transferred to, a Plan or (ii) [for the first transfer after an offering
of Class M-7, Class M-8, Class M-9 or Class M-10 Certificates, the Class M-7,
Class M-8, Class M-9 or Class M-10 Certificates have been offered in an
underwriting or placement within the meaning of Prohibited Transaction Exemption
2002-41, as amended] are being acquired by an insurance company, the source of
funds used to acquire and hold the Certificate is an "insurance company general
account" as such term is defined in Prohibited Transaction Class Exemption
("PTCE") 95-60 and the conditions in Sections I and III of PTCE 95-60 have been
satisfied.
Very truly yours,
By: __________________________
Name:
Title:
X-0
XXXXXXX X
XXXX XX XXX CONTRACTS
[Available Upon Request]
H-1
EXHIBIT I
LOSS MITIGATION ACTION PLAN
--------------------------------------------------------------------------------------------------
DEFAULT MITIGATION ACTION SUPPORTING STANDARDS
--------------------------------------------------------------------------------------------------
Forbearance Workout Borrower documents a temporary financial
Defer any of the following: hardship resulting in request for a forbearance
1. accrued interest Borrower documents financial ability to pay
2. past due principal under the proposed forbearance terms
3. escrow advances Borrower expresses a willingness to perform.
4. corporate advances Current monthly payments are scheduled to be
5. ancillary fees made prior to late charge date during the
6. any combination of the above forbearance term
--------------------------------------------------------------------------------------------------
Loan Modification Workout Borrower documents a non-temporary financial
Any of the following: hardship resulting in the request for a loan
1. waive accrued interest modification
2. waive past due principal Borrower documents financial ability to pay
3. waive corporate advances under the proposed loan modification terms
4. waive ancillary fees Borrower does not have the ability to pay under
5. reduce principal the original loan terms
6. reduce interest rate Borrower expresses a willingness to perform
7. any combination of the above items No waiver of escrow advances (taxes and
8. any combination with the Forbearance insurance) is allowed
items
--------------------------------------------------------------------------------------------------
Short Sale Disposal Sale to a third party
Waive or negotiate a reduced amount of Independent appraisal supports sale price
any of the following: No cash to seller (borrower), excluding costs
1. accrued interest necessary to close
2. principal Borrower does not have the ability and/or
3. escrow advances willingness to pay
4. corporate advances Borrower no longer wants property
5. ancillary fees
6. prepayment charges
7. any combination of the above items
--------------------------------------------------------------------------------------------------
I-1
-----------------------------------------------------------------------------------------------
DEFAULT MITIGATION ACTION SUPPORTING STANDARDS
-----------------------------------------------------------------------------------------------
Short pay-off Disposal Refinance by independent third party Lender
Waive or negotiate a reduced amount of Independent appraisal supports new loan
any of the following: amount
1. accrued interest New loan is no cash out (i.e. no cash to
2. principal borrower excluding costs necessary to close)
3. escrow advances Borrower has expressed his/her unwillingness
4. corporate advances to pay
5. ancillary fees Anticipated refinance time frame is less than
6. prepayment charges anticipated foreclosure time frame
7. any combination of the above items
-----------------------------------------------------------------------------------------------
Deed-in-lieu Disposal Borrower has already or will abandon the
property or is willing to vacate the property
(in a broom sweep condition) on a mutually
agreeable date
Borrower does not have the ability and/or
willingness to pay
Independent appraisal confirms property has a
value
Title is clean
Property appears to be resalable based on
condition and value shown in independent
appraisal
Property does not appear to have any
environmental or hazardous conditions (or
such conditions appear to be curable)
-----------------------------------------------------------------------------------------------
Foreclosure Disposal Borrower has already or will abandon the
property (which may be by an eviction
proceeding or mutual agreement)
Borrower does not have the ability and/or
willingness to pay
Independent appraisal confirms property has a
value
Property appears to be resalable based on
condition and value shown in independent
appraisal
Property does not appear to have any
environmental or hazardous conditions (or
such conditions appear to be curable)
-----------------------------------------------------------------------------------------------
Workouts in the form of either a Forbearance or Loan Modification
require that the Borrower document the existence of a financial hardship leading
to the payment delinquency and document the ability to make the payments
required under the proposed Forbearance or Loan Modification. If the Borrower
fails to meet both of these conditions or the Borrower is uncooperative, a
Disposal
I-2
Loss Mitigation Action will be employed to liquidate the delinquent loan,
assuming the Borrower does not otherwise cure the existing default. Each of the
Default Mitigation Actions and Supporting Standards may not be applicable to
each and every loan subject to a default in its monthly payments and in those
cases where a Default Mitigation Action or Supporting Standard may be
applicable, each is subject to amendment and/or waiver on an individual basis
pursuant to applicable federal, state and local laws, decisional authorities,
court orders, instructions of regulatory and/or other governmental authorities,
the advice of legal counsel, instructions from the Trustee and changes in the
loan servicing standards.
I-3
EXHIBIT J-1
FORM CERTIFICATION TO BE PROVIDED BY THE DEPOSITOR WITH FORM 10-K
I, [identify the certifying individual], certify that:
1. I have reviewed this annual report on Form 10-K, and all reports
on Form 8-K containing distribution or servicing reports filed in respect of
periods included in the year covered by this annual report, of Argent Securities
Inc., Asset-Backed Pass-Through Certificates, Series 2004-W7;
2. Based on my knowledge, the information in these reports, taken as
a whole, does not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading as of the
last day of the period covered by this annual report;
3. Based on my knowledge, the distribution or servicing information
required to be provided to the trustee by the servicer under the pooling and
servicing, or similar, agreement, for inclusion in these reports is included in
these reports;
4. Based on my knowledge and upon the annual compliance statement
included in the report and required to be delivered to the trustee in accordance
with the terms of the pooling and servicing, or similar, agreement, and except
as disclosed in the reports, the servicer has fulfilled its obligations under
the servicing agreement; and
5. The reports disclose all significant deficiencies relating to the
servicer's compliance with the minimum servicing standards based upon the report
provided by an independent public accountant, after conducting a review in
compliance with the Uniform Single Attestation Program for Mortgage Bankers or
similar procedure, as set forth in the pooling and servicing, or similar,
agreement, that is included in these reports.
In giving the certifications above, I have reasonably relied on
information provided to me by the following unaffiliated parties: Deutsche Bank
National Trust Company.
Date: __________________
___________________________
[Signature]
[Title]
X-0-0
XXXXXXX X-0
FORM CERTIFICATION TO BE
PROVIDED TO DEPOSITOR BY THE TRUSTEE
Re: Argent Securities Inc., Series 2004-W7
Asset-Backed Certificates, Series 2004-W7
I, [identify the certifying individual], a [title] of Deutsche Bank
National Trust Company, as Trustee, hereby certify to Argent Securities Inc.
(the "Depositor"), and its officers, directors and affiliates, and with the
knowledge and intent that they will rely upon this certification, that:
1. I have reviewed the annual report on Form 10-K for the fiscal
year [___], and all reports on Form 8-K containing distribution reports filed in
respect of periods included in the year covered by that annual report, of the
Depositor relating to the above-referenced trust;
2. Based on my knowledge, the information in these distribution
reports prepared by the Trustee, taken as a whole, does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading as of the last day of the period covered by that
annual report; and
3. Based on my knowledge, the distribution information required to
be provided by the Trustee under the Pooling and Servicing Agreement is included
in these distribution reports.
Capitalized terms used but not defined herein have the meanings
ascribed to them in the Pooling and Servicing Agreement, dated May 1, 2004 (the
"Pooling and Servicing Agreement"), among the Registrant as depositor,
Ameriquest Mortgage Company as master servicer and Deutsche Bank National Trust
Company as trustee.
DEUTSCHE BANK NATIONAL TRUST
COMPANY, as Trustee
By:________________________________
Name:
Title:
Date:
J-2-1
EXHIBIT K
[Reserved]
K-1
EXHIBIT L
[Reserved]
L-1
EXHIBIT M
ANNUAL STATEMENT OF COMPLIANCE PURSUANT TO SECTION 3.19
Argent Securities Inc.
Asset-Backed Pass-Through Certificates, Series 2004-W7
I, _____________________, hereby certify that I am a duly appointed
__________________________ of Ameriquest Mortgage Company (the "Master
Servicer"), and further certify as follows:
1. This certification is being made pursuant to the terms of the
Pooling and Servicing Agreement, dated as of May 1, 2004 (the "Agreement"),
among Argent Securities Inc., as depositor, the Master Servicer and Deutsche
Bank National Trust Company, as trustee.
2. I have reviewed the activities of the Master Servicer during the
preceding year and the Master Servicer's performance under the Agreement and to
the best of my knowledge, based on such review, the Master Servicer has
fulfilled all of its obligations under the Agreement throughout the year.
Capitalized terms not otherwise defined herein have the meanings set
forth in the Agreements.
Dated: _________________
M-1
IN WITNESS WHEREOF, the undersigned has executed this Certificate as
of ________________.
By:_____________________________
Name:
Title:
I, _________________________, a (an) __________________ of the
Master Servicer, hereby certify that _________________ is a duly elected,
qualified, and acting _______________________ of the Master Servicer and that
the signature appearing above is his/her genuine signature.
IN WITNESS WHEREOF, the undersigned has executed this Certificate as
of ______________.
By:_____________________________
Name:
Title:
M-2
SCHEDULE 1
MORTGAGE LOAN SCHEDULE
Filed By Paper
Schedule I-1
SCHEDULE 2
PREPAYMENT CHARGE SCHEDULE
Available Upon Request
Schedule-2-1
