Exhibit 4.2
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INDENTURE
Among
LUMINENT MORTGAGE TRUST 200_-_
as Issuer,
[o],
as Master Servicer
and
[o],
as Indenture Trustee
Dated as of [o]
LUMINENT MORTGAGE TRUST 200_-_
MORTGAGE-BACKED NOTES, SERIES 200_-_
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TABLE OF CONTENTS
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ARTICLE I DEFINITIONS AND INCORPORATION BY REFERENCE..................... 2
SECTION 1.1 DEFINITIONS............................................. 2
SECTION 1.2 INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT....... 27
SECTION 1.3 RULES OF CONSTRUCTION................................... 27
ARTICLE II THE NOTES..................................................... 28
SECTION 2.1 FORM.................................................... 28
SECTION 2.2 EXECUTION, AUTHENTICATION, DELIVERY AND DATING.......... 29
SECTION 2.3 REGISTRATION; REGISTRATION OF TRANSFER AND EXCHANGE..... 29
SECTION 2.4 MUTILATED, DESTROYED, LOST OR STOLEN NOTES.............. 31
SECTION 2.5 PERSONS DEEMED OWNERS................................... 31
SECTION 2.6 PAYMENT OF PRINCIPAL AND INTEREST....................... 31
SECTION 2.7 CANCELLATION............................................ 32
SECTION 2.8 AUTHENTICATION OF NOTES................................. 33
SECTION 2.9 BOOK-ENTRY NOTES........................................ 35
SECTION 2.10 NOTICES TO CLEARING AGENCY.............................. 35
SECTION 2.11 DEFINITIVE NOTES........................................ 36
SECTION 2.12 TAX..................................................... 36
SECTION 2.13 RELEASE OF COLLATERAL................................... 36
ARTICLE III COVENANTS.................................................... 37
SECTION 3.1 PAYMENT OF PRINCIPAL AND INTEREST....................... 37
SECTION 3.2 MAINTENANCE OF OFFICE OR AGENCY......................... 37
SECTION 3.3 MONEY FOR PAYMENTS TO BE HELD IN TRUST.................. 37
SECTION 3.4 EXISTENCE............................................... 39
SECTION 3.5 PROTECTION OF COLLATERAL................................ 39
SECTION 3.6 OPINIONS AS TO TRUST FUND............................... 40
SECTION 3.7 PERFORMANCE OF OBLIGATIONS.............................. 40
SECTION 3.8 NEGATIVE COVENANTS...................................... 41
SECTION 3.9 COVENANTS OF THE ISSUER................................. 42
SECTION 3.10 RESTRICTED PAYMENTS..................................... 42
SECTION 3.11 TREATMENT OF NOTES AS DEBT FOR TAX PURPOSES............. 42
SECTION 3.12 NOTICE OF EVENTS OF DEFAULT............................. 43
SECTION 3.13 FURTHER INSTRUMENTS AND ACTS............................ 43
SECTION 3.14 ANNUAL STATEMENT AS TO COMPLIANCE....................... 43
SECTION 3.15 REPRESENTATIONS AND WARRANTIES OF THE ISSUER............ 43
SECTION 3.16 ANNUAL OPINIONS AS TO COLLATERAL........................ 44
ARTICLE IV SATISFACTION AND DISCHARGE.................................... 44
SECTION 4.1 SATISFACTION AND DISCHARGE OF INDENTURE................. 44
SECTION 4.2 APPLICATION OF TRUST MONEY.............................. 45
ARTICLE V EVENTS OF DEFAULT; REMEDIES.................................... 46
SECTION 5.1 EVENTS OF DEFAULT....................................... 46
SECTION 5.2 ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT...... 47
SECTION 5.3 COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY
INDENTURE TRUSTEE.................................... 47
SECTION 5.4 REMEDIES; PRIORITIES.................................... 50
SECTION 5.5 LIMITATION OF SUITS..................................... 51
SECTION 5.6 UNCONDITIONAL RIGHTS OF NOTEHOLDERS TO RECEIVE PRINCIPAL
AND INTEREST......................................... 52
SECTION 5.7 RESTORATION OF RIGHTS AND REMEDIES...................... 52
SECTION 5.8 RIGHTS AND REMEDIES CUMULATIVE.......................... 52
SECTION 5.9 DELAY OR OMISSION NOT A WAIVER.......................... 52
SECTION 5.10 CONTROL BY NOTEHOLDERS.................................. 52
SECTION 5.11 WAIVER OF PAST DEFAULTS................................. 53
SECTION 5.12 UNDERTAKING FOR COSTS................................... 53
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TABLE OF CONTENTS
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SECTION 5.13 WAIVER OF STAY OR EXTENSION LAWS........................ 53
SECTION 5.14 ACTION ON NOTES......................................... 53
SECTION 5.15 OPTIONAL PRESERVATION OF THE COLLATERAL................. 54
SECTION 5.16 PERFORMANCE AND ENFORCEMENT OF CERTAIN OBLIGATIONS...... 54
ARTICLE VI THE INDENTURE TRUSTEE....................................... 54
SECTION 6.1 DUTIES OF INDENTURE TRUSTEE............................. 55
SECTION 6.2 RIGHTS OF INDENTURE TRUSTEE............................. 57
SECTION 6.3 INDIVIDUAL RIGHTS OF INDENTURE TRUSTEE.................. 58
SECTION 6.4 INDENTURE TRUSTEE'S DISCLAIMER.......................... 58
SECTION 6.5 NOTICE OF DEFAULT....................................... 58
SECTION 6.6 REPORTS BY INDENTURE TRUSTEE TO HOLDERS................. 58
SECTION 6.7 COMPENSATION AND INDEMNITY.............................. 58
SECTION 6.8 REPLACEMENT OF INDENTURE TRUSTEE........................ 59
SECTION 6.9 SUCCESSOR INDENTURE TRUSTEE BY MERGER................... 60
SECTION 6.10 APPOINTMENT OF CO-INDENTURE TRUSTEE OR SEPARATE
INDENTURE TRUSTEE.................................... 60
SECTION 6.11 ELIGIBILITY............................................. 62
SECTION 6.12 REPRESENTATIONS AND WARRANTIES.......................... 62
SECTION 6.13 PREFERENTIAL COLLECTION OF CLAIMS AGAINST ISSUER........ 62
ARTICLE VII NOTEHOLDERS' LISTS AND REPORTS.............................. 62
SECTION 7.1 ISSUER TO FURNISH INDENTURE TRUSTEE NAMES AND ADDRESSES
OF NOTEHOLDERS....................................... 62
SECTION 7.2 PRESERVATION OF INFORMATION; COMMUNICATIONS TO
NOTEHOLDERS.......................................... 63
SECTION 7.3 REPORTS BY ISSUER....................................... 63
SECTION 7.4 REPORTS BY INDENTURE TRUSTEE............................ 63
ARTICLE VIII ACCOUNTS, DISBURSEMENTS AND RELEASES........................ 64
SECTION 8.1 COLLECTION OF MONEY..................................... 64
SECTION 8.2 PAYMENTS ON THE NOTES................................... 64
SECTION 8.3 RELEASE OF COLLATERAL................................... 64
ARTICLE IX ADMINISTRATION OF TRUST FUND.................................. 65
SECTION 9.1 COLLECTION ACCOUNTS; DISTRIBUTION ACCOUNT............... 65
SECTION 9.2 PERMITTED WITHDRAWALS FROM THE DISTRIBUTION ACCOUNT..... 66
SECTION 9.3 ADVANCES BY MASTER SERVICER............................. 67
SECTION 9.4 COMPENSATING INTEREST PAYMENTS.......................... 67
SECTION 9.5 PRE-FUNDING ACCOUNT..................................... 67
SECTION 9.6 FINANCIAL ASSETS CUSTODIAL ACCOUNT...................... 68
SECTION 9.7 CALCULATION OF LIBOR.................................... 69
SECTION 9.8 MONTHLY STATEMENTS TO NOTEHOLDERS....................... 70
SECTION 9.9 REPORTS TO THE SECURITIES AND EXCHANGE COMMISSION....... 72
SECTION 9.10 DISCOVERY OF BREACH; REPURCHASE AND SUBSTITUTION OF
MORTGAGE LOANS....................................... 73
ARTICLE X SUPPLEMENTAL INDENTURES........................................ 75
SECTION 10.1 SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF NOTEHOLDERS.. 75
SECTION 10.2 SUPPLEMENTAL INDENTURES WITH CONSENT OF NOTEHOLDERS..... 76
SECTION 10.3 EXECUTION OF SUPPLEMENTAL INDENTURES.................... 77
SECTION 10.4 EFFECT OF SUPPLEMENTAL INDENTURE........................ 77
SECTION 10.5 CONFORMITY WITH TRUST INDENTURE ACT..................... 78
SECTION 10.6 REFERENCE IN NOTES TO SUPPLEMENTAL INDENTURES........... 78
SECTION 10.7 AMENDMENTS TO TRUST AGREEMENT........................... 78
ARTICLE XI DISPOSITION OF THE COLLATERAL; REDEMPTION OF THE NOTES........ 78
SECTION 11.1 REDEMPTION OF THE NOTES................................. 78
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TABLE OF CONTENTS
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SECTION 11.2 FORM OF REDEMPTION NOTICE............................... 79
SECTION 11.3 NOTES PAYABLE ON REDEMPTION DATE........................ 80
ARTICLE XII ADMINISTRATION AND SERVICING OF MORTGAGE LOANS BY THE MASTER
SERVICER............................................. 80
SECTION 12.1 DUTIES OF THE MASTER SERVICER; ENFORCEMENT OF SERVICERS'
OBLIGATIONS.......................................... 80
SECTION 12.2 COMPENSATION TO THE MASTER SERVICER..................... 81
SECTION 12.3 MERGER OR CONSOLIDATION................................. 82
SECTION 12.4 RESIGNATION OF MASTER SERVICER.......................... 82
SECTION 12.5 ASSIGNMENT OR DELEGATION OF DUTIES BY THE MASTER
SERVICER............................................. 00
XXXXXXX 00.0 XXXXXXXXXX XX LIABILITY OF THE MASTER SERVICER.......... 83
SECTION 12.7 INDEMNIFICATION; THIRD-PARTY CLAIMS..................... 83
SECTION 12.8 MASTER SERVICER EVENTS OF DEFAULT....................... 84
SECTION 12.9 INDENTURE TRUSTEE TO ACT; APPOINTMENT OF SUCCESSOR...... 86
SECTION 12.10 NOTIFICATION TO NOTEHOLDERS............................. 87
SECTION 12.11 MASTER SERVICER TO ACT AS SERVICER; APPOINTMENT OF
SUCCESSOR............................................ 88
SECTION 12.12 NOTIFICATION TO NOTEHOLDERS............................. 89
SECTION 12.13 RECORDS; CONFIDENTIALITY................................ 89
SECTION 12.14 ANNUAL OFFICER'S CERTIFICATE AS TO COMPLIANCE........... 89
SECTION 12.15 ANNUAL INDEPENDENT ACCOUNTANT'S SERVICING REPORT........ 90
ARTICLE XIII MISCELLANEOUS............................................... 90
SECTION 13.1 COMPLIANCE CERTIFICATES AND OPINIONS, ETC............... 90
SECTION 13.2 FORM OF DOCUMENTS DELIVERED TO INDENTURE TRUSTEE........ 91
SECTION 13.3 ACTS OF NOTEHOLDERS..................................... 92
SECTION 13.4 NOTICES, ETC. TO INDENTURE TRUSTEE, THE ISSUER AND
RATING AGENCIES...................................... 92
SECTION 13.5 NOTICES TO NOTEHOLDERS; WAIVER.......................... 93
SECTION 13.6 CONFLICT WITH TRUST INDENTURE ACT....................... 93
SECTION 13.7 EFFECT OF HEADINGS AND TABLE OF CONTENTS................ 93
SECTION 13.8 SUCCESSORS AND ASSIGNS.................................. 93
SECTION 13.9 SEVERABILITY............................................ 94
SECTION 13.10 BENEFITS OF INDENTURE AND CONSENT OF NOTEHOLDERS........ 94
SECTION 13.11 LEGAL HOLIDAYS.......................................... 94
SECTION 13.12 GOVERNING LAW........................................... 94
SECTION 13.13 COUNTERPARTS............................................ 94
SECTION 13.14 RECORDING OF INDENTURE.................................. 94
SECTION 13.15 ISSUER OBLIGATIONS...................................... 94
SECTION 13.16 NO PETITION............................................. 95
SECTION 13.17 INSPECTION.............................................. 95
SECTION 13.18 EXECUTION BY THE ISSUER................................. 95
SCHEDULES
Schedule I Mortgage Loan Schedule
Schedule II Financial Asset Schedule
Schedule III Form of Monthly Statements to Noteholders
Schedule IV Purchase Agreements
Schedule V Servicing Agreements
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EXHIBITS
EXHIBIT A Form of Note
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CROSS REFERENCE TABLE
Cross-reference sheet showing the location in the Indenture of the
provisions inserted pursuant to Sections 310 through 318(a) inclusive of the
Trust Indenture Act of 1939.*
Trust Indenture Act of 1939 Indenture Section
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Section 310
(a)(1)...................................................... 6.7
(a)(2)...................................................... 6.7, 6.8
(a)(3)...................................................... 6.13
(a)(4)...................................................... Not Applicable
(a)(5)...................................................... 6.7
(b)......................................................... 6.7, 6.9
(c)......................................................... Not Applicable
Section 311
(a)......................................................... 6.12
(b)......................................................... 6.12
(c)......................................................... Not Applicable
Section 312
(a)......................................................... 7.1, 7.2
(b)......................................................... 7.2
(c)......................................................... 7.2
Section 313
(a)......................................................... 7.3
(b)......................................................... 7.3
(c)......................................................... 13.5
(d)......................................................... 7.3
Section 314
(a)(1)...................................................... 7.4
(a)(2)...................................................... 7.4
(a)(3)...................................................... 7.4
(a)(4)...................................................... 7.4
(b)(1)...................................................... 2.11(c), 13.01
(b)(2)...................................................... 3.6
(c)(1)...................................................... 2.11(d), 4.1,
8.2(d), 13.1
(c)(2)...................................................... 2.11(c), 4.1,
8.2(d), 13.1
(c)(3)...................................................... 8.2(d)
(d)(1)...................................................... 13.1
(d)(2)...................................................... 13.1
(d)(3)...................................................... 13.1
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* This Cross-Reference Table is not part of the Indenture.
(e)......................................................... 13.1
Section 315
(a)......................................................... 6.1
(b)......................................................... 6.2, 13.5
(c)......................................................... 6.1
(d)(1)...................................................... 6.1
(d)(2)...................................................... 6.1
(d)(3)...................................................... 6.1
(e)......................................................... 5.12
Section 316
(a)......................................................... 1.2
(b)......................................................... 5.9
(c)......................................................... 1.2
Section 317
(a)(1)...................................................... 5.3
(a)(2)...................................................... 5.5
(b)......................................................... 3.3
Section 318
(a)......................................................... 13.7
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This INDENTURE dated as of [o], among Luminent Mortgage Trust 200_-_, a
Delaware statutory trust, as Issuer (the "ISSUER"), [o], as Master Servicer (the
"MASTER SERVICER") and [o], as Indenture Trustee (the "INDENTURE TRUSTEE"),
PRELIMINARY STATEMENT
The Issuer has duly authorized the execution and delivery of this Indenture
to provide for its Luminent Mortgage Trust 200_-_, Mortgage-Backed Notes, Series
200_-_ (the "NOTES"), issuable as provided in this Indenture. All covenants and
agreements made by the Issuer herein are for the benefit and security of the
Holders of the Notes and the Note Insurer. The Issuer is entering into this
Indenture, and the Indenture Trustee is accepting the trusts created hereby, for
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged. All things necessary to make this Indenture a valid agreement of
the Issuer in accordance with its terms have been done.
GRANTING CLAUSE
Subject to the terms of this Indenture, the Issuer hereby Grants on the
Closing Date to the Indenture Trustee, as Indenture Trustee for the benefit of
the Holders of the Notes, all of the Issuer's right, title and interest in and
to:
(i) the Mortgage Loans listed on Schedule I to this Indenture (including
property that secures a Mortgage Loan that becomes REO Property), including the
related Mortgage Loan Files delivered or to be delivered to the Indenture
Trustee and all payments of principal and interest received, collected or
otherwise recovered in respect of principal and interest after the Cut-off Date.
(ii) the Issuer's rights and benefits but none of its obligations under the
Sale Agreement (including the Issuer's right to cause the Depositor to
repurchase Mortgage Loans from the Issuer under certain circumstances described
therein);
(iii) the Issuer's rights and benefits but none of its obligations under
the Servicing Agreements;
(iv) the Issuer's rights and benefits but none of its obligations under the
Trust Agreement;
(v) the Issuer's rights and benefits but none of its obligations under the
Acknowledgments;
(vi) the Trust Accounts, all amounts and property in the Trust Accounts
from time to time, and the Security Entitlements (as defined in the UCC) to all
Financial Assets credited to the Trust Accounts from time to time;
(vii) all other property of the Trust from time to time;
(viii) all present and future claims, demands, causes of action and chooses
in action in respect of any or all of the foregoing; and
(ix) all payments on or under and all proceeds of every kind and nature
whatsoever in respect of any or all of the foregoing, including all proceeds of
the conversion thereof, voluntary or involuntary, into cash or other liquid
property, all cash proceeds, accounts, accounts receivable, notes, drafts,
acceptances, chattel paper, checks, deposit accounts, insurance proceeds,
condemnation awards, rights to payment of any and every kind and other forms of
obligations and receivables, instruments and other property which at any time
constitute all or part of or are included in the proceeds of any of the
foregoing (collectively, the "COLLATERAL").
The foregoing Grant is made in trust to secure the payment of principal of
and interest on, and any other amounts owing in respect of, the Notes and to
secure (i) the payment of all amounts due on the Notes in accordance with their
terms, (ii) the payment of all other sums payable under the Indenture with
respect to the Notes, and (iii) compliance with the provisions of this
Indenture, all as provided in this Indenture.
The Indenture Trustee, as Indenture Trustee on behalf of the holders of the
Notes acknowledges such Grant, accepts the trusts hereunder and agrees to
perform the duties required of it in this Indenture in accordance with its
terms.
Each Holder, by acceptance of the Notes and the Indenture Trustee agree and
acknowledge that each item of Collateral that is physically delivered to the
Indenture Trustee will be held by the Indenture Trustee (or its custodian) in
trust for the benefit of the Noteholders under the terms of this Agreement.
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.1 Definitions. Except as otherwise specified herein or as the
context may otherwise require, (i) capitalized terms used but not otherwise
defined herein shall have the respective meanings set forth in the Servicing
Agreement for all purposes of this Indenture and (ii) the following terms have
the respective meanings set forth below for all purposes of this Indenture.
ACT: The meaning specified in Section 13.3(a).
ACCOUNT: Each of the Collection Account, the Distribution Account
(including each sub-account thereof), the Financial Asset Custodial Account and
the Escrow Accounts.
ACCRUAL PERIOD: With respect to any Distribution Date and with respect to
the Notes, the calendar month to immediately preceding the month of such
Distribution Date; and with respect to the LIBOR Notes the period commencing on
the prior Distribution Date immediately preceding the month in which such
Distribution Date occurs and ending at the close of business on the calendar day
immediately preceding the Distribution Date.
ACKNOWLEDGEMENT: Each of the Assignment, Assumption and Recognition
Agreements related to the Servicing Agreements, which are listed on Schedule V
hereto, assigning rights under the Purchase Agreements and the Servicing
Agreements from the Seller to the Depositor and from the Depositor to the
Indenture Trustee for the benefit of the Noteholders.
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ADDITIONAL COLLATERAL: With respect to any Additional Collateral Mortgage
Loan, the marketable securities and other acceptable collateral pledged as
collateral pursuant to the related pledge agreements.
ADDITIONAL COLLATERAL MORTGAGE LOAN: Each Mortgage Loan identified as such
in the Mortgage Loan Schedule.
ADJUSTABLE RATE MORTGAGE LOAN: Any Mortgage Loan in which the related
Mortgage Note contains a provision whereby the Mortgage Rate is adjusted from
time to time in accordance with the terms of such Mortgage Note.
ADVANCE: Any Monthly Advance or Servicer Advance.
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.
APPRAISED VALUE: With respect to any Mortgage Loan, the Appraised Value of
the related Mortgaged Property shall be: (i) with respect to a Mortgage Loan
other than a Refinancing Mortgage Loan, the lesser of (a) the value of the
Mortgaged Property based upon the appraisal made at the time of the origination
of such Mortgage Loan and (b) the sales price of the Mortgaged Property at the
time of the origination of such Mortgage Loan; and (ii) with respect to a
Refinancing Mortgage Loan, the value of the Mortgaged Property based upon the
appraisal made at the time of the origination of such Refinancing Mortgage Loan.
ASSIGNMENT OF MORTGAGE: An assignment of the Mortgage, notice of transfer
or equivalent instrument, in recordable form, sufficient under the laws of the
jurisdiction wherein the related Mortgaged Property is located to reflect the
sale of the Mortgage to the Indenture Trustee, which assignment, notice of
transfer or equivalent instrument may be in the form of one or more blanket
assignments covering the Mortgage Loans secured by Mortgaged Properties located
in the same jurisdiction, if permitted by law; provided, however, that the
Indenture Trustee shall not be responsible for determining whether any such
assignment is in recordable form.
AUTHORIZED OFFICER: With respect to the Trust, any officer of the Owner
Trustee who is authorized to act for the Owner Trustee in matters relating to
the Trust and who is identified on the list of Authorized Officers delivered by
the Owner Trustee to the Indenture Trustee on the Closing Date (as such list may
be modified or supplemented from time to time thereafter).
AVAILABLE DISTRIBUTION AMOUNT: With respect to any Distribution Date, the
total amount of all cash received by the Indenture Trustee on the Mortgage Loans
from each Servicer or otherwise through the related Remittance Date for deposit
into the Distribution Account in respect of such Distribution Date, including
(1) all scheduled installments of interest (net of the related Servicing Fees
and the Master Servicing Fees) and principal collected on the Mortgage Loans and
due during the Due Period related to such Distribution Date, together with any
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Advances in respect thereof, (2) all Insurance Proceeds, Liquidation Proceeds
and the proceeds of any Additional Collateral from the Mortgage Loans, in each
case for such Distribution Date, (3) all other amounts received from the
Servicer with respect to the sale of any defaulted Mortgage Loans in accordance
with the terms of the related Servicing Agreement during the related Prepayment
Period, (4) all partial or full Principal Prepayments, together with any accrued
interest thereon, identified as having been received from the Mortgage Loans
during the related Prepayment Period, (5) any Compensating Interest Payments
paid by the Master Servicer and/or received from the Servicers in respect of
Prepayment Interest Shortfalls with respect to the Mortgage Loans, (6) the
aggregate Purchase Price of all Defective Mortgage Loans purchased from the
Trust Fund during the related Prepayment Period and (7) any amounts remaining in
the Pre-Funding Account and transferred to the Distribution Account immediately
following the termination of the Pre-Funding Period, minus:
(A) all related charges and other amounts payable or reimbursable to
the Master Servicer, the Securities Administrator or the Indenture
Trustee under this Agreement, up to an aggregate maximum amount of
$[o] annually, or to the Servicers under the Servicing Agreements;
(B) in the case of (2), (3) and (4) above, any related unreimbursed
expenses incurred by the related Servicers in connection with a
liquidation or foreclosure and any unreimbursed Advances or Servicing
Advances due to the Master Servicer or the related Servicers;
(C) any related unreimbursed Non-recoverable Advances due to the
Master Servicer or the Servicers; and
(D) in the case of (1) through (4) above, any related amounts
collected which are determined to be attributable to a subsequent Due
Period or Prepayment Period.
AVERAGE SIXTY-DAY DELINQUENCY RATIO: The ratio of the average of the
aggregate Principal Balances of Mortgage Loans delinquent 60 days or more for
the preceding three Due Periods to the average aggregate Scheduled Principal
Balance for the Mortgage Loans for these periods.
AVERAGE THIRTY-DAY DELINQUENCY RATIO: The ratio of the average of the
aggregate Principal Balances of Mortgage Loans delinquent 30 days or more for
the preceding three Due Periods to the average aggregate Scheduled Principal
Balance for the Mortgage Loans for these periods.
BANKRUPTCY CODE: The United States Bankruptcy Code of 1986, as amended, as
codified in 11 U.S.C. xx.xx. 101-1330.
BANKRUPTCY COVERAGE TERMINATION DATE: The date at which the Bankruptcy Loss
Coverage Amount is reduced to zero.
BANKRUPTCY LOSS: With respect to any Mortgage Loan, losses that are
incurred as a result of a Deficient Valuation or Debt Service Reduction;
provided, however, that a Bankruptcy
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Loss shall not be deemed a Bankruptcy Loss hereunder so long as the related
Servicer has notified the Master Servicer and Indenture Trustee in writing that
the related Servicer is diligently pursuing any remedies that may exist in
connection with the related Mortgage Loan and either (A) the related Mortgage
Loan is not in default with regard to payments due thereunder or (B) delinquent
payments of principal and interest under the related Mortgage Loan and any
related escrow payments in respect of such Mortgage Loan are being advanced on a
current basis by the related Servicer, in either case without giving effect to
any Debt Service Reduction or Deficient Valuation.
BANKRUPTCY LOSS COVERAGE AMOUNT: As of any Determination Date, the
Bankruptcy Loss Coverage Amount shall equal the Initial Bankruptcy Coverage
Amount as reduced by (i) the aggregate amount of Bankruptcy Losses allocated to
the Notes since the Cut-off Date and (ii) any permissible reductions in the
Bankruptcy Loss Coverage Amount as evidenced by a letter of each Rating Agency
to the Indenture Trustee to the effect that any such reduction will not result
in a downgrading of the then current ratings assigned to the Notes rated by it.
BOOK-ENTRY NOTES: A beneficial interest in any Notes, ownership and
transfers of which shall be made through book entries by a Clearing Agency as
described in Section 2.9.
BUSINESS DAY: Any day other than (i) a Saturday or a Sunday, or (ii) a day
on which banking institutions in the City of New York, New York, or the State of
[o], or the city in which the Corporate Trust Office of the Indenture Trustee is
located are authorized or obligated by law or executive order to be closed.
CERTIFICATE OF TRUST: The certificate of trust of the Issuer substantially
in the form of Exhibit B to the Trust Agreement.
CLEARING AGENCY: An organization registered as a "clearing agency" pursuant
to Section 17A of the Securities Exchange Act of 1934, as amended. As of the
Closing Date, the Clearing Agency shall be The Depository Trust Company.
CLEARING AGENCY PARTICIPANT: A broker, dealer, bank, other financial
institution or other Person for which from time to time a Clearing Agency
effects book-entry transfers and pledges of securities deposited with the
Clearing Agency.
CLEARSTREAM: Clearstream Banking, societe anonyme, and any successor
thereto.
CLOSING DATE: [o].
CODE: The Internal Revenue Code of 1986, including any successor or
amendatory provisions.
COLLATERAL: The meaning specified in the Granting Clause of this Indenture.
COLLECTION ACCOUNT: The accounts created and maintained by each Servicer
pursuant to its Servicing Agreement with a depository institution in the name of
the related Servicer for the benefit of the Indenture Trustee on behalf of
Noteholders and designated "[____________] in
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trust for the registered holders of Luminent Mortgage Trust 200_-_
Mortgage-Backed Notes, Series 200__-__."
COMMISSION: The Securities and Exchange Commission.
COMPENSATING INTEREST PAYMENT: As to any Distribution Date and any
Prepayment Interest Shortfall for a Mortgage Loan during the related Prepayment
Period, the lesser of (1) the Servicing Fee for the related Servicer for such
date and (2) any Prepayment Interest Shortfall for such date.
COOPERATIVE CORPORATION: The entity that holds title (fee or an acceptable
leasehold estate) to the real property and improvements constituting the
Cooperative Property and which governs the Cooperative Property, which
Cooperative Corporation must qualify as a Cooperative Housing Corporation under
Section 216 of the Code.
CONFIDENTIAL INFORMATION: All non-public personal information about the
Mortgagor under the Mortgage Loan that is supplied to the Master Servicer by or
on behalf of the Mortgagor in connection with this Agreement and the
transactions contemplated hereby. Confidential Information shall not include
information which (i) is or becomes generally available to the public other than
as a result of disclosure by the Master Servicer or its subsidiaries,
affiliates, directors, officers, employees, agents or controlling persons; (ii)
was available to the Master Servicer on a non-confidential basis from a Person
other than the Mortgagor prior to its disclosure to the Master Servicer; (iii)
is required to be disclosed by a governmental authority or related governmental
agencies or as otherwise required by law; or (iv) becomes available to the
Master Servicer on a non-confidential basis from a Person other than the
Mortgagor who, to the best knowledge of the Master Servicer, is not otherwise
bound by a confidentiality agreement with the Master Servicer and is not
otherwise prohibited from transmitting the information to the Master Servicer.
COOPERATIVE LOAN: Any Mortgage Loan secured by Cooperative Shares and a
Proprietary Lease.
COOPERATIVE PROPERTY: The real property and improvements owned by the
Cooperative Corporation, that includes the allocation of individual dwelling
units to the holders of the shares of the Cooperative Corporation.
COOPERATIVE SHARES: Shares issued by a Cooperative Corporation.
CORPORATE TRUST OFFICE: The principal office of the Indenture Trustee at
which at any particular time its corporate trust business shall be administered,
which office at date of execution of this Agreement is located at [o];
Attention: [o], or at such other address as the Indenture Trustee may designate
from time to time by notice to the Noteholders, and the Issuer, or the principal
corporate trust office of any successor Indenture Trustee at the address
designated by such successor Indenture Trustee by notice to the Noteholders and
the Issuer.
CUMULATIVE REALIZED LOSSES: The aggregate Realized Losses incurred in
respect of Liquidated Mortgage Loans since the Cut-off Date.
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CURRENT INTEREST: With respect to any Distribution Date and with respect to
each class of Securities, one month's interest accrued during the related
Accrual Period at the applicable Note Interest Rate on Note Principal Amount.
CURRENT REALIZED LOSS RATIO: With respect to any Distribution Date, the
annualized percentage derived from the fraction, the numerator of which is the
sum of the aggregate Realized Losses in respect of the Assets for the three
preceding Prepayment Periods and the denominator of which is the arithmetic
average of the Pool Scheduled Principal Balances for such Distribution Date and
the preceding two Distribution Dates.
CUT-OFF DATE: [o].
CUT-OFF DATE BALANCE: As to any Mortgage Loan, the Scheduled Principal
Balance thereof as of the close of business on the Cut-off Date.
DEBT SERVICE REDUCTION: With respect to any Mortgage Loan, a reduction by a
court of competent jurisdiction in a proceeding under the Bankruptcy Code in the
Scheduled Payment for such Mortgage Loan which became final and non-appealable,
except such a reduction resulting from a Deficient Valuation or any reduction
that results in a permanent forgiveness of principal.
DEFAULT: Any occurrence that is, or with notice or the lapse of time or
both would become, an Event of Default.
DEFICIENT VALUATION: With respect to any Mortgage Loan, a valuation by a
court of competent jurisdiction of the Mortgaged Property in an amount less than
the then-outstanding indebtedness under the Mortgage Loan, or any reduction in
the amount of principal to be paid in connection with any Scheduled Payment that
results in a permanent forgiveness of principal, which valuation or reduction
results from an order of such court which is final and non-appealable in a
proceeding under the Bankruptcy Code.
DEFINITIVE NOTES: The meaning specified in Section 2.11.
DEPOSITOR: Xxxxx Asset Securitization, Inc., a Delaware corporation, or its
successor in interest.
DEPOSITORY: DTC or any other Person designated by the Issuer as Depository
in the case of Book-Entry Notes.
DEPOSITORY INSTITUTION: Any depository institution or trust company,
including the Indenture 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 in the highest rating category by the Rating Agencies, or is otherwise
acceptable to the Rating Agencies.
DETERMINATION DATE: As to any Distribution Date, the [o]th day of each
month or if such [o]th day is not a Business Day the immediately succeeding
Business Day.
7
DISTRIBUTION ACCOUNT: The separate Eligible Account created and maintained
by the Indenture Trustee pursuant to Section 9.1 in the name of the Indenture
Trustee for the benefit of the Noteholders and designated "[o] in trust for
registered holders of Luminent Mortgage Trust 200__-__ Mortgage-Backed Notes,
Series 200_-_." Funds in the Distribution Account shall be held in trust for the
Noteholders for the uses and purposes set forth in this Agreement.
DISTRIBUTION DATE: The [o]th day of each calendar month after the initial
issuance of the Notes, or if such [o]th day is not a Business Day, the next
succeeding Business Day, commencing in [_______________].
DUE DATE: With respect to any Distribution Date, the first day of the
calendar month in which such Distribution Date occurs, which represents the date
on which a Scheduled Payment is due on each Mortgage Loan under the related
Mortgage Note, exclusive of any grace period.
DUE PERIOD: With respect to any Distribution Date, the period commencing on
the second day of the month preceding the month in which the Distribution Date
occurs and ending at the close of business on the first day of the month in
which the Distribution Date occurs.
DTC: The Depository Trust Company.
ELIGIBLE ACCOUNT: Any of (i) an account or accounts maintained with a
federal or state chartered depository institution or trust company the
short-term unsecured debt obligations of which (or, in the case of a depository
institution or trust company that is the principal subsidiary of a holding
company, the debt obligations of such holding company) have the highest
short-term ratings of each Rating Agency at the time any amounts are held on
deposit therein, or (ii) an account or accounts in a depository institution or
trust company in which such accounts are insured by the FDIC (to the limits
established by the FDIC) and the uninsured deposits in which accounts are
otherwise secured such that, as evidenced by an Opinion of Counsel delivered to
the Indenture Trustee and to each Rating Agency, the Noteholders have a claim
with respect to the funds in such account or a perfected first priority security
interest against any collateral (which shall be limited to Permitted
Investments) securing such funds that is superior to claims of any other
depositors or creditors of the depository institution or trust company in which
such account is maintained, or (iii) a trust account or accounts maintained with
(a) the trust department of a federal or state chartered depository institution
or (b) a trust company, acting in its fiduciary capacity or (iv) any other
account acceptable to each Rating Agency. Eligible Accounts may bear interest,
and may include, if otherwise qualified under this definition, accounts
maintained with the Indenture Trustee.
ERISA: The Employee Retirement Income Security Act of 1974, as amended.
ESCROW ACCOUNT: With respect to each Servicing Agreement, as "Escrow
Account" is defined therein.
EUROCLEAR: Xxxxxx Guaranty Trust Company of New York, Brussels office, as
operator of the Euroclear System.
EVENT OF DEFAULT: As specified in Section 5.1.
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EXCESS CASH: With respect to any Distribution Date, the amount, if any, by
which the Available Distribution Amount for such Distribution Date exceeds the
sum of (i) the Note Interest for the related Distribution Date, and (ii) the
Monthly Principal for the related Distribution Date.
EXCHANGE ACT: The Securities Exchange Act of 1934, as amended.
EXECUTIVE OFFICER: With respect to any corporation, the Chief Executive
Officer, Chief Operating Officer, Chief Financial Officer, President, Executive
Vice President, any Vice President, the Secretary or the Treasurer of such
corporation; and with respect to any partnership, any general partner thereof.
EXPENSE RATE: As to each Mortgage Loan, the sum of the related Servicing
Fee Rate, Master Servicing Fee Rate and the Indenture Trustee Fee Rate.
XXXXXX MAE: The entity formerly known as the Federal National Mortgage
Association, a federally chartered and privately owned corporation organized and
existing under the Federal National Mortgage Association Charter Act, or any
successor thereto.
FDIC: The Federal Deposit Insurance Corporation, or any successor thereto.
FINANCIAL ASSETS: Those mortgage-backed securities issued by Xxxxxx Xxx,
Xxxxxxx Mac, Xxxxxx Xxx or one or more private issuers identified on Schedule
II.
FINANCIAL ASSET CUSTODIAL ACCOUNT: The Eligible Account established and
maintained under Section 9.6(b) into which any Financial Assets will be
deposited on the Closing Date.
FIRREA: The Financial Institutions Reform, Recovery, and Enforcement Act of
1989, as amended.
FITCH: Fitch Ratings, Inc., or any successor in interest. The address for
notices to Fitch shall be 0 Xxxxx Xxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx, 00000,
Attention: [o] or such other address as Fitch may hereunder furnish to the
Depositor or the Master Servicer.
FORMULA PRINCIPAL AMOUNT: As to any Distribution Date, the sum (a) the
principal portion of each Scheduled Payment (without giving effect, prior to the
Bankruptcy Coverage Termination Date, to any reductions thereof caused by any
Debt Service Reductions or Deficient Valuations) due on each Mortgage Loan on
the related Due Date, (b) the Scheduled Principal Balance of each Mortgage Loan
that was repurchased by the Seller or the Servicer pursuant to this Agreement as
of such Distribution Date, (c) the Substitution Adjustment Amount in connection
with any Deleted Mortgage Loan received with respect to such Distribution Date,
(d) any Insurance Proceeds or Liquidation Proceeds allocable to recoveries of
principal of Mortgage Loans that are not yet Liquidated Mortgage Loans received
during the calendar month preceding the month of such Distribution Date, (e)
with respect to each Mortgage Loan that became a Liquidated Mortgage Loan during
the calendar month preceding the month of such Distribution Date, the amount of
the Liquidation Proceeds allocable to principal received during the calendar
month preceding the month of such Distribution Date with respect to such
Mortgage Loan and (f) all Principal Prepayments received during the related
Prepayment Period.
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FRAUD LOAN: A Liquidated Mortgage Loan as to which a Fraud Loss has
occurred.
FRAUD LOSSES: Realized Losses on Mortgage Loans as to which a loss is
sustained by reason of a default arising from fraud, dishonesty or
misrepresentation in connection with the related Mortgage Loan, including a loss
by reason of the denial of coverage under any related PMI Policy because of such
fraud, dishonesty or misrepresentation.
FRAUD LOSS COVERAGE AMOUNT: As of the Closing Date, $[o] subject to
reduction from time to time, by the amount of Fraud Losses allocated to the
Notes. In addition, on each anniversary of the Cut-off Date, the Fraud Loss
Coverage Amount will be reduced as follows: (a) on the first, second, third and
fourth anniversaries of the Cut-off Date, to an amount equal to the lesser of
(i) [1]%, in the case of the first anniversary, and [0.5]%, in the case of the
second, third and fourth anniversaries of the then current Pool Scheduled
Principal Balance and (ii) the excess of the Fraud Loss Coverage Amount as of
the preceding anniversary of the Cut-off Date over the cumulative amount of
Fraud Losses allocated to the Notes since such preceding anniversary; and (b) on
the fifth anniversary of the Cut-off Date, to zero.
FRAUD LOSS COVERAGE TERMINATION DATE: The point in time at which the Fraud
Loss Coverage Amount is reduced to zero.
XXXXXXX MAC: A corporate instrumentality of the United States, formerly
known as the Federal Home Loan Mortgage Corporation, created and existing under
Title III of the Emergency Home Finance Act of 1970, as amended, or any
successor thereto.
GLOBAL SECURITIES: The meaning specified in Section 2.1.
GRANT: Mortgage, pledge, bargain, sell, warrant, alienate, remise, release,
convey, assign, transfer, create, and xxxxx x xxxx upon and a security interest
in and right of set-off against, deposit, set over and confirm pursuant to this
Indenture. A Grant of the Collateral or of any other agreement or instrument
shall include all rights, powers and options (but none of the obligations) of
the granting party thereunder, including the immediate and continuing right to
claim for, collect, receive and give receipt for principal and interest payments
in respect of the Collateral and all other moneys payable thereunder, to give
and receive notices and other communications, to make waivers or other
agreements, to exercise all rights and options, to bring Proceedings in the name
of the granting party or otherwise, and generally to do and receive anything
that the granting party is or may be entitled to do or receive thereunder or
with respect thereto.
HOLDER or NOTEHOLDER: The registered holder of any Note as recorded on the
books of the Note Registrar except that, solely for the purposes of taking any
action or giving any consent pursuant to this Agreement, any Note registered in
the name of the Seller, the Indenture Trustee or any Affiliate thereof shall be
deemed not to be outstanding in determining whether the requisite percentage
necessary to effect any such consent has been obtained, except that, in
determining whether the Indenture Trustee shall be protected in relying upon any
such consent, only Notes which a Responsible Officer of the Indenture Trustee
knows to be so held shall be disregarded. The Indenture Trustee may request and
conclusively rely on certifications by the Seller in determining whether any
Notes are registered to an Affiliate of the Seller.
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INDENTURE TRUSTEE: [o] and its permitted successors and assigns and, if a
successor Indenture Trustee is appointed hereunder, such successor.
INDEPENDENT: When used with respect to any specified Person, that such
Person (a) is in fact independent of the Issuer, any other obligor on the Notes,
the Seller and any Affiliate of any of the foregoing Persons, (b) does not have
any direct financial interest or any material indirect financial interest in the
Issuer, any such other obligor, the Seller or any Affiliate of any of the
foregoing Persons and (c) is not connected with the Issuer, any such other
obligor, the Seller or any Affiliate of any of the foregoing Persons as an
officer, employee, promoter, underwriter, Indenture Trustee, partner, director
or person performing similar functions.
INDEPENDENT CERTIFICATE: A certificate or opinion to be delivered to the
Indenture Trustee under the circumstances described in, and otherwise complying
with, the applicable requirements of Section 13.1, made by an Independent
appraiser or other expert appointed by an Issuer Order and approved by the
Indenture Trustee in the exercise of reasonable care, and such opinion or
certificate shall state that the signer has read the definition of "Independent"
in this Indenture and that the signer is Independent within the meaning thereof.
INDIRECT PARTICIPANT: A broker, dealer, bank or other financial institution
or other Person that clears through or maintains a custodial relationship with a
Depository Participant.
INITIAL BANKRUPTCY COVERAGE AMOUNT: $[o].
INITIAL CUT-OFF DATE POOL PRINCIPAL BALANCE: $[o].
INITIAL PURCHASE DATE: The Distribution Date following the month in which
the Pool Balance is less than [o]% of the Cut-off Date Balance.
INSURANCE POLICY: With respect to any Mortgage Loan included in the Trust
Fund, any insurance policy, including all riders and endorsements thereto in
effect, including any replacement policy or policies therefor.
INSURANCE PROCEEDS: Proceeds paid by an insurer pursuant to any Insurance
Policy (excluding proceeds required to be applied to the restoration and repair
of the related Mortgaged Property or released to the Mortgagor), in each case
other than any amount included in such Insurance Proceeds in respect of Insured
Expenses.
INSURED EXPENSES: Expenses covered by an Insurance Policy or any other
insurance policy with respect to the Mortgage Loans.
INTEREST DISTRIBUTION AMOUNT: On any Distribution Date, the Current
Interest for the Notes, as reduced by Net Prepayment Interest Shortfalls, Relief
Act Reductions and the interest portion of Excess Losses. Any such shortfalls
and losses shall be allocated among the Notes proportionately on the basis of
the Interest Distribution Amount otherwise payable thereon.
ISSUER: Luminent Mortgage Trust 200_-__, or any successor and, for purposes
of any provision contained herein and required by the TIA, each other obligor on
the Notes.
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ISSUER ORDER and ISSUER REQUEST: A written order or request signed in the
name of the Issuer by any one of its Authorized Officers and delivered to the
Indenture Trustee.
LATEST POSSIBLE MATURITY DATE: The Distribution Date following the third
anniversary of the scheduled maturity date of the Mortgage Loan having the
latest scheduled maturity date as of the Cut-off Date.
LIBOR: The London interbank offered rate for one-month United States dollar
deposits established on each LIBOR Determination Date pursuant to Section
9.7(a).
LIBOR BUSINESS DAY: Any day on which banks in London, England and the City
of New York are open and conducting transactions in foreign currency and
exchange.
LIBOR DETERMINATION DATE: The second Business Day immediately preceding the
commencement of each Accrual Period for any LIBOR Notes.
LIQUIDATED MORTGAGE LOAN: With respect to any Distribution Date, a
defaulted Mortgage Loan (including any REO Property) which was liquidated in the
calendar month preceding the month of such Distribution Date and as to which the
related Servicer has certified (in accordance with its Servicing Agreement) that
it has received all amounts it expects to receive in connection with the
liquidation of such Mortgage Loan, including the final disposition of an REO
Property.
LIQUIDATION EXPENSES: With respect to a Mortgage Loan in liquidation,
unreimbursed expenses paid or incurred by or for the account of the Master
Servicer and not recovered by the Master Servicer under any PMI Policy for
reasons other than the Master Servicer's failure to ensure the maintenance of or
compliance with a PMI Policy, such expenses including (a) property protection
expenses, (b) property sales expenses, (c) foreclosure and sale costs, including
court costs and reasonable attorneys' fees, and (d) similar expenses reasonably
paid or incurred in connection with liquidation.
LIQUIDATION PROCEEDS: Amounts, including Insurance Proceeds, received in
connection with the partial or complete liquidation of defaulted Mortgage Loans,
whether through Indenture Trustee's sale, foreclosure sale or otherwise or
amounts received in connection with any condemnation or partial release of a
Mortgaged Property and any other proceeds received in connection with an REO
Property.
LOAN-TO-VALUE RATIO: With respect to any Mortgage Loan and as to any date
of determination, the fraction (expressed as a percentage) the numerator of
which is the principal balance of the related Mortgage Loan at such date of
determination and the denominator is the lesser of purchase price or the
Appraised Value of the related Mortgaged Property.
LOST MORTGAGE NOTE: Any Mortgage Note the original of which was permanently
lost or destroyed and has not been replaced.
MAJORITY: On any date, Holders of the Notes representing more than 50% of
the Note Principal Amount of the Notes then outstanding.
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MASTER SERVICER: [o] and its successors and assigns in its capacity as
Master Servicer.
MASTER SERVICER EVENT OF DEFAULT: As defined in Section 12.8 hereof.
MASTER SERVICING FEE: As to each Mortgage Loan and any Distribution Date,
an amount equal to (i) one-twelfth of the Master Servicing Fee Rate multiplied
by the Scheduled Principal Balance of such Mortgage Loan as of the Due Date in
the prior calendar month plus (ii) all investment earnings derived from
principal and interest collections received on the Mortgage Loans on deposit in
the Distribution Account during the period from and including the Remittance
Date to but excluding such Distribution Date.
MASTER SERVICING FEE RATE: With respect to each Mortgage Loan, [o]% per
annum.
MERS: Mortgage Electronic Registration Systems, Inc., a corporation
organized and existing under the laws of the State of Delaware, or any successor
thereto.
MERS(R) SYSTEM: The system of recording transfers of Mortgages
electronically maintained by MERS.
MIN: The Mortgage Identification Number for Mortgage Loans registered with
MERS on the MERS(R) System.
MOM LOAN: With respect to any Mortgage Loan as to which MERS acts as the
mortgagee of such Mortgage Loan, solely as nominee for the originator of such
Mortgage Loan and its successors and assigns, at the origination thereof.
MONTHLY ADVANCE: With respect to a Mortgage Loan, the payments required to
be made by the Master Servicer or the applicable Servicer with respect to any
Distribution Date pursuant to this Agreement or the Servicing Agreements, as
applicable, the amount of any such payment being equal to the aggregate of
payments of principal and interest (net of the Master Servicing Fee and/or the
applicable Servicing Fee and net of any net income in the case of any REO
Property) of the Mortgage Loans that were due on the related Due Date and not
received as of the close of business on the related Determination Date, less the
aggregate amount of any such delinquent payments that the Master Servicer or the
Servicers, as the case may be, have determined would constitute Non-recoverable
Advances if advanced.
MONTHLY STATEMENT: The statement delivered to the Noteholders pursuant to
Section 9.8.
MOODY'S: Xxxxx'x Investors Service, Inc., or any successor thereto. The
address for notices to Moody's shall be Xxxxx'x Investors Service, Inc., 00
Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Residential Pass-Through
Monitoring, or such other address as Moody's may hereafter furnish to the
Depositor or the Master Servicer.
MORTGAGE: The mortgage, deed of trust or other instrument creating a first
lien on an estate in fee simple or leasehold interest in real property securing
a Mortgage Note.
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MORTGAGE FILE: The mortgage documents listed in the Sale Agreement
pertaining to a particular Mortgage Loan and any additional documents delivered
to the Indenture Trustee to be added to the Mortgage File pursuant to this
Agreement.
MORTGAGE LOAN: Each of the mortgage loans transferred and assigned to the
Indenture Trustee pursuant to the provisions hereof as from time to time are
held as a part of the Trust Fund (including any REO Property), the mortgage
loans so held being identified in the Mortgage Loan Schedule, notwithstanding
foreclosure or other acquisition of title of the related Mortgaged Property.
MORTGAGE LOAN SCHEDULE: The list of Mortgage Loans (as from time to time
amended by the Depositor or the related Servicer to reflect the addition of
Substitute Mortgage Loans and the deletion of Deleted Mortgage Loans pursuant to
the provisions of this Agreement) transferred to the Indenture Trustee as part
of the Trust Fund and from time to time subject to this Agreement, attached
hereto as Schedule I, setting forth, among other things, the following
information with respect to each Mortgage Loan:
(i) the loan number;
(ii) the Mortgagor's name and the street address of the Mortgaged
Property, including the zip code;
(iii) the maturity date;
(iv) the original principal balance;
(v) the Cut-off Date Balance;
(vi) the first payment date of the Mortgage Loan;
(vii) the Scheduled Payment in effect as of the Cut-off Date;
(viii) the Loan-to-Value Ratio at origination;
(ix) a code indicating whether the residential dwelling at the time of
origination was represented to be owner-occupied;
(x) a code indicating whether the residential dwelling is either (a) a
detached single family dwelling (b) a dwelling in a de minimis PUD,
(c) a condominium unit or PUD (other than a de minimis PUD), (d) a
two- to four-unit residential property or (e) a Cooperative Property;
(xi) the Mortgage Rate;
(xii) a code indicating whether the Mortgage Loan is a Lender PMI
Mortgage Loan and, in the case of any Lender PMI Mortgage Loan, a
percentage representing the amount of the related interest premium
charged to the borrower;
14
(xiii) the purpose for the Mortgage Loan;
(xiv) the type of documentation program pursuant to which the Mortgage
Loan was originated; and
(xv) the Servicing Fee for the Mortgage Loan.
Such schedule shall also set forth the total of the amounts described under
(iv) and (v) above for all of the Mortgage Loans.
MORTGAGE NOTE: The original executed note or other evidence of indebtedness
evidencing the indebtedness of a Mortgagor under a Mortgage Loan, including any
riders or addenda thereto.
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, net of any interest premium charged by
the mortgagee to obtain or maintain any PMI Policy.
MORTGAGED PROPERTY: With respect to each Mortgage Loan, the underlying real
property servicing payments of the Mortgage Note (or, with respect to a
Cooperative Loan, the related Cooperative Shares and Proprietary Lease), plus,
in the case of each Additional Collateral Mortgage Loan, the Additional
Collateral.
MORTGAGOR: The obligor(s) on a Mortgage Note.
OVERCOLLATERALIZATION AMOUNT: As to any Distribution Date, the amount, if
any, by which (x) the Aggregate Principal Balance of the Mortgage Loans for such
Distribution Date exceeds (y) the Note Principal Balance for such Distribution
Date, after taking into account the Monthly Principal (disregarding any
permitted reduction thereof in Monthly Principal due to an Overcollateralization
surplus made on such Distribution Date) to be applied in reduction of the Note
Principal Balance on such Distribution Date. If the Aggregate Principal Balance
of the Mortgage Loans is less than the Note Principal Balance for such
Distribution Date, determined as provided above, the Overcollateralization
Amount for such Distribution Date shall be [o].
OVERCOLLATERIZATION DEFICIT: As to any Distribution Date, the amount, if
any, by which the Note Principal Balance on such Distribution Date (after taking
into account any payments to be paid on such Distribution Date in reduction of
the Note Principal Balance) exceeds the Aggregate Principal Balance of the
Mortgage Loans for such Distribution Date. If the Aggregate Principal Balance of
the Mortgage Loans as determined pursuant to the preceding sentence is greater
than the Note Principal Balance for such Distribution Date determined as
provided above, the Overcollateralization Deficit for such Distribution Date
shall be [o].
OVERCOLLATERALIZATION SURPLUS: As to any Distribution Date, the amount, if
any, by which (x) the Overcollateralization Amount on such Distribution Date
exceeds (y) the Required Overcollaterlization Amount on such Distribution Date.
15
NET LIQUIDATION PROCEEDS: As to any Liquidated Mortgage Loan, the
Liquidation proceeds less the sum of related unreimbursed Liquidation Expenses,
Master Servicing Fees, Servicing Advances and Monthly Advances.
NET MORTGAGE RATE: As to each Mortgage Loan, and at any time, the Mortgage
Rate less the related Expense Rate.
NET PREPAYMENT INTEREST SHORTFALLS: As to any Distribution Date, the amount
by which the aggregate of Prepayment Interest Shortfalls during the related
Prepayment Period exceeds the Compensating Interest Payments made with respect
to such Distribution Date.
NET WAC: As to any Distribution Date, a per annum rate equal to the
weighted average Net Mortgage Rate of the Mortgage Loans.
NON-RECOVERABLE ADVANCE: Any portion of an Monthly Advance or Servicer
Advance previously made or proposed to be made by the related Servicer or the
Master Servicer that (as certified in an Officer's Certificate of such party),
in the good faith judgment of the such party, will not be ultimately recoverable
by such party, from the related Mortgagor, related Liquidation Proceeds or
otherwise.
NOTE DEPOSITORY AGREEMENT: The agreement dated [o], among the Issuer, the
Indenture Trustee and The Depository Trust Company, as the initial Clearing
Agency, relating to the Book-Entry Notes.
NOTE INTEREST RATE: [o]% per annum.
NOTE OWNER: With respect to a Book-Entry Note, the Person who is the
beneficial owner of such Book-Entry Note, as reflected on the books of the
Clearing Agency or on the books of a Person maintaining an account with such
Clearing Agency (directly as a Clearing Agency Participant or as an indirect
participant, in each case in accordance with the rules of such Clearing Agency),
and with respect to a Definitive Note, the Person that is the beneficial owner
of such Note as reflected in the Note Register.
NOTE PRINCIPAL AMOUNT: With respect to the any Note at any date, the
maximum dollar amount of principal to which the Holder thereof is then entitled
hereunder, such amount being equal to the Denomination thereof minus the sum of
(i) all distributions of principal previously made with respect hereto and (ii)
all Realized Losses allocated thereto. Unless specifically provided herein to
the contrary, Note Principal Amounts shall be determined as of the close of
business of the immediately preceding Distribution Date, after giving effect to
all distribution made on such date.
NOTE REGISTER and NOTE REGISTRAR: The respective meanings specified in
Section 2.3.
OFFICER'S CERTIFICATE: A certificate signed by any Authorized Officer of
the Issuer (or by an officer of the Depositor pursuant to the Administration
Agreement), under the circumstances described in, and otherwise complying with,
the applicable requirements of Section 13.1, and delivered to the Indenture
Trustee.
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OPINION OF COUNSEL: One or more written opinions of counsel who may, except
as otherwise expressly provided in this Indenture, be employees of or counsel to
the Issuer and who shall be satisfactory to the Indenture Trustee, which opinion
or opinions shall be addressed to the Indenture Trustee, as Indenture Trustee,
and shall comply with any applicable requirements of Section 13.1 and shall be
in form and substance satisfactory to the Indenture Trustee.
OPTIONAL TERMINATION: The termination of the trust created hereunder in
connection with the purchase of the Mortgage Loans.
OPTIONAL TERMINATION PURCHASE PRICE: With respect to a Optional
Termination, a price equal to the sum of (i) [o]% of the aggregate outstanding
principal balance of the Mortgage Loans plus accrued interest thereon at the
applicable Mortgage Rate, and (b) the fair market value of all other property
being purchased.
OTS: The Office of Thrift Supervision.
OUTSTANDING: With respect to any Note and as of the date of determination,
any Note theretofore authenticated and delivered under this Indenture except:
(i) Notes theretofore canceled by the Note Registrar or delivered to
the Note Registrar for cancellation;
(ii) Notes or portions thereof the payment for which money in the
necessary amount has been theretofore deposited with the Indenture Trustee
or any Paying Agent in trust for the related Noteholders; and
(iii) Notes in exchange for or in lieu of which other Notes have been
authenticated and delivered pursuant to this Indenture unless proof
satisfactory to the Indenture Trustee is presented that any such Notes are
held by a bona fide purchaser; provided, that in determining whether the
Holders of the requisite Outstanding Amount of the Notes have given any
request, demand, authorization, direction, notice, consent, or waiver
hereunder or under any other Operative Agreement, Notes owned by the
Issuer, any other obligor upon the Notes, the Seller, or any Affiliate of
any of the foregoing Persons shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Indenture Trustee
shall be protected in relying upon any such request, demand, authorization,
direction, notice, consent, or waiver, only Notes that a Responsible
Officer of the Indenture Trustee knows to be so owned shall be so
disregarded. Notes so owned that have been pledged in good faith may be
regarded as Outstanding if the pledgee establishes to the satisfaction of
the Indenture Trustee the pledgee's right so to act with respect to such
Notes and that the pledgee is not the Issuer, any other obligor upon the
Notes, the Seller or any Affiliate of any of the foregoing Persons.
OUTSTANDING AMOUNT: The aggregate of the Note Principal Amounts of all
Notes Outstanding at the date of determination.
PAYING AGENT: The Indenture Trustee or any other Person that meets the
eligibility standards for the Indenture Trustee specified in Section 6.11 hereof
and is authorized by the
17
Issuer to make payments to and distributions from the Distribution Account,
including payments of principal of or interest on the Notes on behalf of the
Issuer.
PENALTY PERIOD: As to any Mortgage Loan, the period of time during which
the borrower will be assessed a Prepayment Premium for any Principal Prepayment
during such time.
PERCENTAGE INTEREST: As defined in the Trust Agreement.
PERMITTED INVESTMENTS: At any time, any one or more of the following
obligations and securities:
(i) obligations of the United States or any agency thereof, provided
such obligations are backed by the full faith and credit of the United
States;
(ii) general obligations of or obligations guaranteed by any state of
the United States or the District of Columbia receiving the highest
long-term debt rating of each Rating Agency, or such lower rating as
will not result in the downgrading or withdrawal of the ratings then
assigned to the Notes by each Rating Agency;
(iii) commercial or finance company paper which is then receiving the
highest commercial or finance company paper rating of each Rating
Agency, or such lower rating as will not result in the downgrading or
withdrawal of the ratings then assigned to the Notes by each Rating
Agency;
(iv) certificates of deposit, demand or time deposits, or bankers'
acceptances issued by any depository institution or trust company
incorporated under the laws of the United States or of any state
thereof and subject to supervision and examination by federal and/or
state banking authorities, provided that the commercial paper and/or
long term unsecured debt obligations of such depository institution or
trust company (or in the case of the principal depository institution
in a holding company system, the commercial paper or long-term
unsecured debt obligations of such holding company, but only if
Xxxxx'x is not a Rating Agency) are then rated one of the two highest
long-term and the highest short-term ratings of each Rating Agency for
such securities, or such lower ratings as will not result in the
downgrading or withdrawal of the rating then assigned to the Notes by
either Rating Agency;
(v) demand or time deposits or certificates of deposit issued by any
bank or trust company or savings institution to the extent that such
deposits are fully insured by the FDIC;
(vi) guaranteed reinvestment agreements issued by any bank, insurance
company or other corporation containing, at the time of the issuance
of such agreements, such terms and conditions as will not result in
the downgrading or withdrawal of the rating then assigned to the Notes
by either Rating Agency;
18
(vii) repurchase obligations with respect to any security described in
clauses (i) and (ii) above, in either case entered into with a
depository institution or trust company (acting as principal)
described in clause (iv) above;
(viii) units of a taxable money-market portfolio having the highest
rating assigned by each Rating Agency and restricted to obligations
issued or guaranteed by the United States of America or entities whose
obligations are backed by the full faith and credit of the United
States of America and repurchase agreements collateralized by such
obligations including money-market portfolios for which the Indenture
Trustee, the Master Servicer, the Securities Administrator or any of
its Affiliates is investment manager or advisor; and
(ix) such other investments bearing interest or sold at a discount
acceptable to each Rating Agency as will not result in the downgrading
or withdrawal of the rating then assigned to the Notes by either
Rating Agency, as evidenced by a signed writing delivered by each
Rating Agency
provided, that no such instrument shall be a Permitted Investment if such
instrument evidences the right to receive interest only payments with respect to
the obligations underlying such instrument.
PERSON: Any individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government, or any agency or political
subdivision thereof.
PMI POLICY: Each policy of primary mortgage guaranty insurance or any
replacement policy therefor with respect to any Mortgage Loan.
POOL SCHEDULED PRINCIPAL BALANCE: As to any Distribution Date, the
aggregate of the Scheduled Principal Balances of the Mortgage Loans which were
Outstanding Mortgage Loans on the Due Date in the month preceding the month of
such Distribution Date.
PREDECESSOR NOTE: With respect to any particular Note, every previous Note
evidencing all or a portion of the same debt as that evidenced by such
particular Note; and, for the purpose of this definition, any Note authenticated
and delivered under Section 2.4 in lieu of a mutilated, lost, destroyed or
stolen Note shall be deemed to evidence the same debt as the mutilated, lost,
destroyed or stolen Note.
PRE-FUNDING ACCOUNT: The account established and maintained pursuant to
Section 9.5.
PRE-FUNDED AMOUNT: $ [o].
PRE-FUNDING PERIOD: The period beginning on the Closing Date and ending on
the earlier of (i) the close of business on _______, (ii) the date on which
there is $100,000 or less (exclusive of investment earnings) remaining in the
Pre-Funding Account, or (iii) the date on which an Event of Default occurs.
19
PREPAYMENT INTEREST SHORTFALL: With respect to any full or partial
Principal Prepayment of a Mortgage Loan, the excess, if any, of (i) one full
month's interest at the applicable Mortgage Rate on the outstanding principal
balance of such Mortgage Loan immediately prior to such Principal Prepayment
over (ii) the amount of interest actually received from the Mortgagor with
respect to such Mortgage Loan in connection with such Principal Prepayment.
PREPAYMENT PERIOD: With respect to any Distribution Date, the calendar
month preceding the month of such Distribution Date.
PREPAYMENT PREMIUM: As to any Mortgage Loan, any payment required to be
made in connection with any Principal Prepayment prior to the expiration or
lapse of the applicable Penalty Period.
PRINCIPAL DISTRIBUTION AMOUNT: For any Distribution Date will be an amount
equal to (A) the aggregate of (i) all scheduled payments of principal received
with respect to the Mortgage Loans and due during the related Due Period, and
all other amounts collected, received or otherwise recovered in respect of
principal of the Mortgage Loans (including Principal Prepayments, but not
including Payments Ahead that are not allocable to principal for the related Due
Period) during or in respect of the related Due Period, and (ii) the aggregate
of the amounts allocable to principal deposited in the Distribution Account on
the related Remittance Date by the Seller, the Depositor, the related Servicer
or the Master Servicer in connection with a repurchase, substitution or removal
of any Mortgage Loan pursuant to the Indenture reduced by (B) the amount of any
Overcollateralization Surplus with respect to such Distribution Date.
PRINCIPAL PREPAYMENT: Any Mortgagor payment of principal or other recovery
of principal on a Mortgage Loan that is recognized as having been received or
recovered in advance of its scheduled Due Date and applied to reduce the
principal balance of the Mortgage Loan[, which is not accompanied by an amount
representing scheduled interest due on any date or dates in any month or months
subsequent to the month of prepayment].
PRINCIPAL PREPAYMENT IN FULL: Any Principal Prepayment made by a Mortgagor
of the entire principal balance of a Mortgage Loan.
PROPRIETARY LEASE: With respect to any Cooperative Property, a lease or
occupancy agreement between a Cooperative Corporation and a holder of related
Cooperative Shares.
PROSPECTUS: The Prospectus Supplement together with the accompanying
prospectus dated [o], relating to the Notes.
PROSPECTUS SUPPLEMENT: The Prospectus Supplement dated [o], relating to the
Notes.
PUD: Planned Unit Development.
PURCHASE AGREEMENT: Any of the mortgage purchase agreements listed in
Schedule IV hereto, as each such agreement may be amended or supplemented from
time to time as permitted hereunder.
20
PURCHASE PRICE: With respect to any Mortgage Loan required to be purchased
by the Depositor pursuant to this Agreement, by the Servicers pursuant to the
Servicing Agreements, or by the Seller pursuant to the Purchase Agreements, an
amount equal to the sum of (i) 100% of the unpaid principal balance of the
Mortgage Loan on the date of such purchase, and (ii) accrued interest thereon at
the applicable Mortgage Rate (or at the applicable Adjusted Mortgage Rate if (x)
the purchaser is any Servicer or (y) if the purchaser is the Seller and the
Seller is any Servicer) from the date through which interest was last paid by
the Mortgagor to the Due Date in the month in which the Purchase Price is to be
distributed to Noteholders.
QUALIFIED INSURER: A mortgage guaranty insurance company duly qualified as
such under the laws of the state of its principal place of business and each
state having jurisdiction over such insurer in connection with the insurance
policy issued by such insurer, duly authorized and licensed in such states to
transact a mortgage guaranty insurance business in such states and to write the
insurance provided by the insurance policy issued by it, approved as a Xxxxxx
Mae-approved mortgage insurer and having a claims paying ability rating of at
least "AA" or equivalent rating by a nationally recognized statistical rating
organization. Any replacement insurer with respect to a Mortgage Loan must have
at least as high a claims paying ability rating as the insurer it replaces had
on the Closing Date.
RATING: The rating initially assigned to the Notes by the Rating Agencies,
as evidenced by a letter from the Rating Agencies.
RATING AGENCY: Means each of S&P, Xxxxx'x and Fitch. If any such
organization or a successor is no longer in existence, "Rating Agency" shall be
such nationally recognized statistical rating organization, or other comparable
Person, as is designated by the Depositor, notice of which designation shall be
given to the Indenture Trustee. References herein to a given rating category of
a Rating Agency shall mean such rating category without giving effect to any
modifiers.
RATING AGENCY CONDITION: With respect to any action to which the Rating
Agency Condition applies, that the Rating Agencies shall have been given [ o ]
days (or such shorter period acceptable to the Rating Agencies) prior notice of
any action to which the Rating Agency Condition applies and that the Rating
Agencies shall have notified the Depositor, the Owner Trustee, the Indenture
Trustee, the Master Servicer and the Securities Administrator in writing that
such proposed action will not result in a reduction or withdrawal of the then
current rating of the Notes (if any).
REALIZED LOSS: With respect to each Liquidated Mortgage Loan, an amount
(not less than zero or more than the Scheduled Principal Balance of the Mortgage
Loan) as of the date of such liquidation, equal to (i) the Scheduled Principal
Balance of the Liquidated Mortgage Loan as of the date of such liquidation, plus
(ii) interest at the Net Mortgage Rate from the Due Date as to which interest
was last paid or advanced (and not reimbursed) to Noteholders up to the Due Date
in the month in which Liquidation Proceeds are required to be distributed on the
Scheduled Principal Balance of such Liquidated Mortgage Loan from time to time,
minus (iii) the Liquidation Proceeds and the proceeds of any Additional
Collateral, if any, received during the month in which such liquidation
occurred, to the extent applied as recoveries of interest at the Net Mortgage
Rate and to principal of the Liquidated Mortgage Loan. With respect to each
21
Mortgage Loan which has become the subject of a Deficient Valuation, if the
principal amount due under the related Mortgage Note has been reduced, the
difference between the principal balance of the Mortgage Loan outstanding
immediately prior to such Deficient Valuation and the 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 and any
Distribution Date, the amount, if any, by which the principal portion of the
related Scheduled Payment has been reduced.
REDEMPTION DATE: In the case of a redemption of the Notes pursuant to
Section 11.1 hereof, the Distribution Date specified by the Indenture Trustee
pursuant to Section 11.2.
REDEMPTION PRICE: An amount equal to the sum of (1) 100% of the aggregate
Note Principal Amount, and (2) the aggregate Current Interest and interest
remaining unpaid from previous Distribution Dates.
REFINANCING MORTGAGE LOAN: Any Mortgage Loan originated in connection with
the refinancing of an existing mortgage loan.
REGISTERED HOLDER: The Person in whose name a Note is registered on the
Note Register on the applicable Record Date.
REGISTERED NOTES: Those Notes which are in registered form. Each of the
Notes will be registered Notes.
RELIEF ACT: The Soldiers' and Sailors' Civil Relief Act of 1940, as
amended, and any similar state laws.
RELIEF ACT REDUCTIONS: With respect to any Distribution Date and any
Mortgage Loan as to which there has been a reduction in the amount of interest
collectible thereon for the most recently ended calendar month as a result of
the application of the Relief Act, the amount, if any, by which (i) interest
collectible on such Mortgage Loan for the most recently ended calendar month is
less than (ii) interest accrued thereon for such month pursuant to the Mortgage
Note.
REMITTANCE DATE: With respect to any Distribution Date, the [18th] Business
Day of the month in which the Distribution Date occurs.
REO PROPERTY: A Mortgaged Property acquired by the Trust Fund through
foreclosure or deed-in-lieu of foreclosure in connection with a defaulted
Mortgage Loan.
REQUEST FOR RELEASE: The Request for Release submitted by the related
Servicer to the Indenture Trustee in the form of Exhibit [o] to the Servicing
Agreement.
REQUIRED INSURANCE POLICY: With respect to any Mortgage Loan, any insurance
policy that is required to be maintained from time to time under this Agreement.
REQUIRED OVERCOLLATERALIZATION AMOUNT: [o].
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REQUIRED RATING: The Notes have received, on the Closing Date, the
following ratings from the Rating Agencies:
[Rating Agency] [Rating Agency]
--------------- ---------------
[o] [o]
SALE AGREEMENT: The sale agreement dated as of [o], by and between the
Seller and the Depositor, pursuant to which the Mortgage Loans are being sold to
the Depositor.
SCHEDULED PAYMENT: The scheduled monthly payment on a Mortgage Loan due on
any Due Date allocable to principal and/or interest on such Mortgage Loan which,
unless otherwise specified herein, shall give effect to any related Debt Service
Reduction and any Deficient Valuation that affects the amount of the monthly
payment due on such Mortgage Loan.
SCHEDULED PRINCIPAL BALANCE: As to any Mortgage Loan and Due Date, the
unpaid principal balance of such Mortgage Loan as of such Due Date as defined in
the amortization schedule at the time relating thereto (before any adjustment to
such amortization schedule by reason of any moratorium or similar waiver or
grace period) after giving effect to any previous partial Principal Prepayments
and Liquidation Proceeds allocable to principal (other than with respect to any
Liquidated Mortgage Loan) and to the payment of principal due on such Due Date
and irrespective of any delinquency in payment by the related Mortgagor.
SECURITIES ACT: The Securities Act of 1933, as amended.
SECURITIES ADMINISTRATOR: [o], not in its individual capacity but solely as
Securities Administrator, or any successor in interest, or if any successor
Securities Administrator shall be appointed as herein provided, then such
successor Securities Administrator.
SELLER: [o] and its successors and assigns, in its capacity as seller of
the Mortgage Loans and the Subsequent Mortgage Loans, if any, to the Depositor
pursuant to the Sale Agreement and the Subsequent Sale Agreement, respectively.
SERVICER: Each of [o] and [o], as servicers of certain Mortgage Loans
pursuant to their respective Servicing Agreements and their respective
successors and assigns under the Servicing Agreements.
SERVICING ADVANCES: As defined in the applicable Servicing Agreement and
will generally include all customary, reasonable and necessary out-of-pocket
costs and expenses incurred in the performance by the Servicer of its servicing
obligations, including, but not limited to, the cost of (a) the preservation,
restoration and protection of the Mortgaged Property, (b) any enforcement or
judicial proceedings, including foreclosures, (c) the management and liquidation
of the Mortgaged Property if the Mortgaged Property is acquired in satisfaction
of the Mortgage, and (d) payments made by the Servicer in respect of any taxes,
assessments and other charges which are or may become a lien upon any Mortgaged
Property or any insurance premiums that are required to maintain adequate fire
and hazard insurance coverage for any Mortgaged Property.
23
SERVICING AGREEMENTS: Each of the servicing agreements identified on
Schedule V hereto, as each such agreement may have been modified by an
Acknowledgement and as amended or supplemented from time to time as permitted
thereby.
SERVICING FEE: As to each Mortgage Loan and any Distribution Date, an
amount equal to the product of (a) one-twelfth of the Servicing Fee Rate
multiplied by (b) the Scheduled Principal Balance of such Mortgage Loan as of
the Due Date in the preceding calendar month.
SERVICING FEE RATE: With respect to each Mortgage Loan and any Distribution
Date, the rate specified in the related Servicing Agreement.
SERVICING OFFICER: Any officer of a Servicer involved in, or responsible
for, the administration and servicing of the Mortgage Loans whose name and
facsimile signature appear on a list of servicing officers furnished to the
Indenture Trustee by the related Servicer on the Closing Date pursuant to a
Servicing Agreement as such list may from time to time be amended.
SPECIAL HAZARD COVERAGE TERMINATION DATE: The date on which the Special
Hazard Loss Coverage Amount is reduced to zero.
SPECIAL HAZARD LOSS: Any Realized Loss suffered by a Mortgaged Property on
account of direct physical loss but not including (i) any loss of a type covered
by a hazard insurance policy or a flood insurance policy required to be
maintained with respect to such Mortgaged Property in the related Servicing
Agreement to the extent of the amount of such loss covered thereby, or (ii) any
loss caused by or resulting from:
(a) normal wear and tear;
(b) fraud, conversion or other dishonest act on the part of the
Indenture Trustee, the Servicer or any of their agents or employees
(without regard to any portion of the loss not covered by any errors and
omissions policy);
(c) errors in design, faulty workmanship or faulty materials, unless
the collapse of the property or a part thereof ensues and then only for the
ensuing loss;
(d) nuclear or chemical reaction or nuclear radiation or radioactive
or chemical contamination, all whether controlled or uncontrolled, and
whether such loss be direct or indirect, proximate or remote or be in whole
or in part caused by, contributed to or aggravated by a peril covered by
the definition of the term "Special Hazard Loss;"
(e) hostile or warlike action in time of peace and war, including
action in hindering, combating or defending against an actual, impending or
expected attack:
1. by any government or sovereign power, de jure or de facto, or
by any authority maintaining or using military, naval or air forces;
or
2. by military, naval or air forces; or
3. by an agent of any such government, power, authority or
forces;
24
(f) any weapon of war employing nuclear fission, fusion or other
radioactive force, whether in time of peace or war; or
(g) insurrection, rebellion, revolution, civil war, usurped power or
action taken by governmental authority in hindering, combating or defending
against such an occurrence, seizure or destruction under quarantine or
customs regulations, confiscation by order of any government or public
authority or risks of contraband or illegal transportation or trade.
SPECIAL HAZARD LOSS COVERAGE AMOUNT: With respect to the first Distribution
Date, $[o]. With respect to any Distribution Date after the first Distribution
Date, the lesser of (a) the greatest of (i) [1%] of the aggregate of the
principal balances of the Mortgage Loans, (ii) twice the principal balance of
the largest Mortgage Loan and (iii) the aggregate of the principal balances of
all Mortgage Loans secured by Mortgaged Properties located in the single
California postal zip code area having the highest aggregate principal balance
of any such zip code area and (b) the Special Hazard Loss Coverage Amount as of
the Closing Date less the amount, if any, of Special Hazard Losses allocated to
the Notes since the Closing Date. All principal balances for the purpose of this
definition will be calculated as of the first day of the calendar month
preceding the month of such Distribution Date after giving effect to Scheduled
Payments on the Mortgage Loans then due, whether or not paid.
SPECIAL HAZARD MORTGAGE LOAN: A Liquidated Mortgage Loan as to which a
Special Hazard Loss has occurred.
S&P: Standard & Poor's Ratings Services, a division of The XxXxxx-Xxxx
Companies, Inc. The address for notices to S&P shall be Standard & Poor's
Ratings Services, 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Mortgage
Surveillance Monitoring, or such other address as S&P may hereafter furnish to
the Depositor and the Servicer.
STATE: Any one of the 00 Xxxxxx xx xxx Xxxxxx Xxxxxx xx Xxxxxxx or the
District of Columbia.
SUBSEQUENT CUT-OFF DATE: The date as determined in the related Subsequent
Sale Agreement.
SUBSEQUENT MORTGAGE LOANS: Each of the Mortgage Loans listed acquired by
the trust with amounts in the Pre-Funding Account and on a schedule attached to
a Subsequent Sale Agreement.
SUBSEQUENT SALE AGREEMENT: Each sale agreement, dated as of a Subsequent
Sales Date, pursuant to which the Seller sells any Subsequent Mortgage Loans to
the Depositor, which Subsequent Mortgage Loans are sold, transferred and
assigned by the Depositor to the Trust.
SUBSEQUENT SALE DATE: The date of each Subsequent Sale Agreement.
SUBSTITUTE MORTGAGE LOAN: A Mortgage Loan substituted by the Seller for a
Deleted Mortgage Loan which must, on the date of such substitution (i) have a
Scheduled Principal Balance, after deduction of the principal portion of the
Scheduled Payment due in the month of
25
substitution, not in excess of, and not more than 10% less than the Scheduled
Principal Balance of the Deleted Mortgage Loan; (ii) be accruing interest at a
rate no lower than and not more than 1% per annum higher than, that of the
Deleted Mortgage Loan; (iii) have a Loan-to-Value Ratio no higher than that of
the Deleted Mortgage Loan; (iv) have a remaining term to maturity no greater
than (and not more than one year less than that of) the Deleted Mortgage Loan;
(v) not be a Cooperative Loan unless the Deleted Mortgage Loan was a Cooperative
Loan and (vi) comply with each representation and warranty set forth in Section
3.01(h) of the Sale Agreement.
SUBSTITUTION ADJUSTMENT AMOUNT: The meaning ascribed to such term pursuant
to Section [o] of the Sale Agreement.
TRUST INDENTURE ACT OR TIA: The Trust Indenture Act of 1939 as in force on
the date hereof, unless otherwise specifically provided.
TRUST ACCOUNTS: The Distribution Account and the Financial Asset Custodial
Account.
INDENTURE TRUSTEE FEE: As to any Distribution Date, an amount equal to
one-twelfth of the Indenture Trustee Fee Rate multiplied by (i) the Pool
Scheduled Principal Balance plus (ii) any amounts remaining in the Pre-Funding
Account (excluding any investment earnings thereon) with respect to such
Distribution Date.
INDENTURE TRUSTEE FEE RATE: With respect to each Mortgage Loan, [o]% per
annum.
UNITED STATES: The United States of America.
UCC: The Uniform Commercial Code as enacted in the relevant jurisdiction.
UNDERWRITERS: [o].
UNDERWRITING AGREEMENT: The Underwriting Agreement, dated [o], among the
Seller, the Depositor and the Underwriters.
UNDERWRITER'S EXEMPTION: Prohibited Transaction Exemption _________, __
Fed. Reg. _____ (_____), as amended (or any successor thereto), or any
substantially similar administrative exemption granted by the U.S. Department of
Labor.
U.S. PERSON: (i) A citizen or resident of the United States, (ii) a
corporation created or organized in or under the laws of the United States, any
state thereof or the District of Columbia, including an entity treated as a
corporation for federal income tax purposes (iii) a partnership (unless Treasury
regulations are adopted that provide otherwise) created or organized in or under
the laws of the United States, any state thereof or the District of Columbia,
including an entity treated as a partnership for federal income tax purposes,
none of the interests in which are owned, directly or indirectly through one or
more intermediate entities, by a person that is not a U.S. Person within the
meaning this paragraph, (iv) an estate the income of which is includible in
gross income for United States federal income tax purposes, regardless of its
source, (v) a trust if a court within the United States is able to exercise
primary supervision over the administration of such trust and one or more United
States fiduciaries have the authority to control all substantial
26
decisions of the trust (or to the extent provided in applicable Treasury
regulations, certain trusts in existence on August 20, 1996 that are eligible to
be treated as United States persons).
UNSCHEDULED DISTRIBUTION AMOUNT: As to any Distribution Date, an amount
equal to the sum of (i) with respect to each Mortgage Loan that became a
Liquidated Mortgage Loan during the calendar month preceding the month of such
Distribution Date, the Liquidation Proceeds allocable to principal received with
respect to such Mortgage Loan and (ii) the amount described in clause (f) of the
definition of "Formula Principal Amount" for such Distribution Date.
SECTION 1.2 Incorporation by Reference of Trust Indenture Act.
(a) Whenever this Indenture refers to a provision of the TIA, the provision
is incorporated by reference in and made a part of this Indenture. The following
TIA terms used in this Indenture have the following meanings:
"COMMISSION" means the Securities and Exchange Commission
"INDENTURE SECURITIES" means the Notes.
"INDENTURE SECURITY HOLDER" means a Noteholder.
"INDENTURE TO BE QUALIFIED" means this Indenture.
"INDENTURE TRUSTEE" or "INSTITUTIONAL INDENTURE TRUSTEE" means the
Indenture Trustee.
"OBLIGOR" on the indenture securities means the Issuer and any other
obligor on the indenture securities.
(b) All other TIA terms used in this Indenture that are defined in the TIA,
defined by TIA reference to another statute or defined by rule of the Securities
and Exchange Commission have the respective meanings assigned to them by such
definitions.
(c) Pursuant to Section 316(a) of TIA, all provisions automatically
provided for in Section 316(a) are hereby expressly excluded.
SECTION 1.3 Rules of Construction. Unless the context otherwise requires:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the meaning assigned
to it in accordance with generally accepted accounting principles as in
effect from time to time;
(iii) "or" is not exclusive;
(iv) "including" means including without limitation;
(v) words in the singular include the plural and words in the plural
include the singular;
27
(vi) any agreement, instrument or statute defined or referred to
herein or in any instrument or certificate delivered in connection herewith
means such agreement, instrument or statute as from time to time amended,
modified or supplemented (as provided in such agreements) and includes (in
the case of agreements or instruments) references to all attachments
thereto and instruments incorporated therein; references to a Person are
also to its permitted successors and assigns; and
(vii) terms defined in the UCC and not otherwise defined herein shall
have the meaning assigned to them in the UCC; and
(viii) to "U.S. dollars", "dollars", or the sign "$" shall be
construed as references to United States dollars which are freely
transferable by residents and non-residents of the United States of America
and convertible by such persons into any other freely convertible currency
unless such transferability or convertibility is restricted by any law or
regulation of general application in which event references to "U.S.
dollars", "dollars", or the sign "$" shall be construed as references to
such coin or currency of the United States of America as at the time of
payment shall be legal tender for the payment of public and private debts
in the United States of America, and "cents" shall be construed
accordingly.
ARTICLE II
THE NOTES
SECTION 2.1 Form. The Notes shall be designated as the "Luminent Mortgage
Trust 200_-__, Mortgage-Backed Notes, Series 200_-__." Each Note, together with
the Indenture Trustee's certificate of authentication, shall be in substantially
the forms set forth in Exhibit A, with such appropriate insertions, omissions,
substitutions and other variations as are required or permitted by this
Indenture, and may have such letters, numbers or other marks of identification
and such legends or endorsements placed thereon as may, consistently herewith,
be determined by the officers executing such Notes, as evidenced by their
execution thereof. Any portion of the text of any Note may be set forth on the
reverse thereof, with an appropriate reference thereto on the face of the Note.
The Definitive Notes and the global certificates ("GLOBAL SECURITIES")
representing the Book-Entry Notes shall be typewritten, printed, lithographed or
engraved or produced by any combination of these methods (with or without steel
engraved borders), all as determined by the officers executing such Notes, as
evidenced by their execution of such Notes.
The Notes shall be issued as registered Notes. The Notes, except as
otherwise provided by supplement to this Indenture, shall be issued in a
denomination of at least $25,000 in principal amount and any larger denomination
that is an integral multiple of $1 approved by the Issuer, such approval to be
evidenced by the execution thereof; provided, however, one Note may be issued in
an amount less than the minimum denomination. If the Notes are issuable in whole
or in part as Book-Entry Notes, any such Note may provide that it shall
represent the aggregate amount of Outstanding Notes from time to time endorsed
thereon and may provide that the aggregate amount of Outstanding Notes
represented thereby may from time to time be reduced to
28
reflect exchanges or increased to reflect the issuance of an additional
principal amount of Notes. Any endorsement of a Book-Entry Note to reflect the
amount, or any increase or decrease in the amount, of Outstanding Notes
represented thereby shall be made in such manner and by such Person or Persons,
as shall be specified therein or in the Issuer Order of authentication delivered
to the Indenture Trustee.
The terms of the Notes set forth in Exhibit A are part of the terms of this
Indenture.
SECTION 2.2 Execution, Authentication, Delivery and Dating. The Notes shall
be executed on behalf of the Issuer by an Authorized Officer of the Owner
Trustee. The signature of any such Authorized Officer on the Notes may be manual
or facsimile.
Notes bearing the manual or facsimile signature of individuals who were at
any time Authorized Officers of the Owner Trustee shall bind the Issuer,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Notes or did not hold
such offices at the date of such Notes.
Subject to the satisfaction of the conditions set forth in Section 2.8
hereof, the Indenture Trustee shall, upon Issuer Order, authenticate and deliver
the Notes for original issue in the aggregate principal amounts as specified
below:
The aggregate principal amounts of Notes outstanding at any time may not
exceed $[o].
The Notes that are authenticated and delivered by the Indenture Trustee to
or upon the order of the Issuer on the Closing Date shall be dated the Closing
Date. All other Notes that are authenticated after the Closing Date as a result
of transfer or exchange or for any other purpose under the Indenture shall be
dated the date of their authentication.
No Note shall be entitled to any benefit under this Indenture or be valid
or obligatory for any purpose, unless there appears on such Note a certificate
of authentication (substantially in the form provided for in the form of Note at
Exhibit A) executed by the Indenture Trustee by the manual signature of one of
its authorized signatories, and such certificate upon any Note shall be
conclusive evidence, and the only evidence, that such Note has been duly
authenticated and delivered hereunder.
SECTION 2.3 Registration; Registration of Transfer and Exchange. The Issuer
shall cause to be kept a register (the "NOTE REGISTER") in which, subject to
such reasonable regulations as it may prescribe, the Issuer shall provide for
the registration of Notes and the registration of transfers of Notes. The [o]
initially shall be the "Note Registrar" for the purpose of registering Notes and
transfers of Notes as herein provided. Upon any resignation of any Note
Registrar, the Issuer shall promptly appoint a successor or, if it elects not to
make such an appointment, assume the duties of Note Registrar.
If a Person other than the Indenture Trustee or [o] is appointed by the
Issuer as Note Registrar, the Issuer will give the Indenture Trustee prompt
written notice of the appointment of such Note Registrar and of the location,
and any change in the location, of the Note Register, and the Indenture Trustee
shall have the right to inspect the Note Register at all reasonable times and to
obtain copies thereof, and the Indenture Trustee shall have the right to rely
upon a certificate
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executed on behalf of the Note Registrar by an Executive Officer thereof as to
the names and addresses of the Holders of the Notes and the principal amounts
and number of such Notes.
Upon surrender for registration of transfer of any Note at the office or
agency of the Issuer to be maintained as provided in Section 3.2, the Issuer
shall execute, and the Indenture Trustee shall authenticate and the Noteholder
shall be entitled to obtain from the Indenture Trustee, in the name of the
designated transferee or transferees, one or more new Notes in any authorized
denominations, of a like aggregate principal amount (or notional amount). At the
option of the Holder, Notes may be exchanged for other Notes in any authorized
denominations, of a like aggregate principal amount (or notional amount), upon
surrender of the Notes to be exchanged at such office or agency. Whenever any
Notes are so surrendered for exchange, the Issuer shall execute, and the
Indenture Trustee shall authenticate and the Noteholder shall be entitled to
obtain from the Indenture Trustee, the Notes which the Noteholder making the
exchange is entitled to receive.
All Notes issued upon any registration of transfer or exchange of Notes
shall be the valid obligations of the Issuer, evidencing the same debt, and
entitled to the same benefits under this Indenture, as the Notes surrendered
upon such registration of transfer or exchange.
Any Note presented or surrendered for registration of transfer or exchange
shall be duly endorsed by, or be accompanied by a written instrument of transfer
in form satisfactory to the Indenture Trustee duly executed by, the Holder
thereof or such Holder's attorney duly authorized in writing, with such
signature guaranteed by an "eligible guarantor institution" meeting the
requirements of the Note Registrar, which requirements include membership or
participation in the Securities Transfer Agent's Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by the Note
Registrar in addition to, or in substitution for, STAMP, all in accordance with
the Exchange Act.
In addition, each purchaser or proposed transferee of a Note must represent
to the Indenture Trustee either (a) that it is not, and is not purchasing the
Notes with assets of, an employee benefit plan subject to Title I of ERISA, or a
plan subject to section 4975 of the Code, or a governmental plan or church plan
that is subject to any provisions of applicable federal, state or local law
("SIMILAR LAW") substantially similar to the foregoing provisions of ERISA or
the Code, or (b) that its acquisition and holding of the Notes will not
constitute or result in a nonexempt prohibited transaction under ERISA or the
Code or Similar Law and will not subject the Issuer, the Indenture Trustee, the
Owner Trustee or Master Servicer to any obligation in addition to those
undertaken in the Indenture.
No service charge shall be made to a Noteholder for any registration of
transfer or exchange of Notes, but the Issuer or the Note Registrar may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any registration of transfer or exchange of
Notes, other than exchanges pursuant to Section 2.4 or Section 10.6 not
involving any transfer.
The preceding provisions of this Section notwithstanding, the Issuer shall
not be required to make and the Note Registrar need not register transfers or
exchanges of Notes for a period of [ o ] days preceding the Distribution Date
for any payment with respect to such Note.
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SECTION 2.4 Mutilated, Destroyed, Lost or Stolen Notes. If (i) any
mutilated Note is surrendered to the Indenture Trustee, or the Indenture Trustee
receives evidence to its satisfaction of the destruction, loss or theft of any
Note, and (ii) there is delivered to the Indenture Trustee such security or
indemnity as may be required by it to hold the Issuer and the Indenture Trustee
harmless, then, in the absence of notice to the Issuer, the Note Registrar or
the Indenture Trustee that such Note has been acquired by a bona fide purchaser,
the Issuer shall execute, and upon its request the Indenture Trustee shall
authenticate and deliver, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Note, a replacement Note; provided, however, that if
any such destroyed, lost or stolen Note, but not a mutilated Note, shall have
become or within [ o ] days shall be due and payable, or shall have been called
for redemption, instead of issuing a replacement Note, the Issuer may pay such
destroyed, lost or stolen Note when so due or payable or upon the Redemption
Date without surrender thereof. If, after the delivery of such replacement Note
or payment of a destroyed, lost or stolen Note pursuant to the proviso to the
preceding sentence, a bona fide purchaser of the original Note in lieu of which
such replacement Note was issued presents for payment such original Note, the
Issuer and the Indenture Trustee shall be entitled to recover such replacement
Note (or such payment) from the Person to whom it was delivered or any Person
taking such replacement Note from such Person to whom such replacement Note was
delivered or any assignee of such Person, except a bona fide purchaser, and
shall be entitled to recover upon the security or indemnity provided therefor to
the extent of any loss, damage, cost or expense incurred by the Issuer or the
Indenture Trustee in connection therewith.
Upon the issuance of any replacement Note under this Section, the Issuer
may require the payment by the Holder of such Note, of a sum sufficient to cover
any tax or other governmental charge that may be imposed in relation thereto and
any other reasonable expenses (including the fees and expenses of the Indenture
Trustee) connected therewith.
Every replacement Note issued pursuant to this Section in replacement of
any mutilated, destroyed, lost or stolen Note shall constitute an original
additional contractual obligation of the Issuer, whether or not the mutilated,
destroyed, lost or stolen Note shall be at any time enforceable by anyone, and
shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Notes duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Notes.
SECTION 2.5 Persons Deemed Owners. Prior to due presentment for
registration of transfer of any Note, the Issuer, the Indenture Trustee and any
agent of the Issuer or the Indenture Trustee may treat the Person in whose name
any Note is registered (as of the day of determination) as the owner of such
Note for the purpose of receiving payments of principal of and interest, if any,
on such Note and for all other purposes whatsoever, whether or not such Note be
overdue, and none of the Issuer, the Indenture Trustee or any agent of the
Issuer or the Indenture Trustee shall be affected by notice to the contrary.
SECTION 2.6 Payment of Principal and Interest. (a) The Notes shall accrue
interest at the Note Interest Rate, and such interest shall be payable on each
Distribution Date, subject to
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Section 3.1. Interest shall be computed on the basis of a 360-day year
consisting of twelve 30-day months. Interest shall be computed on LIBOR Notes on
the basis of a 360-day year and the actual number of days elapsed in each
Accrual Period and in accordance with Section 9.7. All interest payments on the
Notes shall be made pro rata to the Noteholders entitled thereto. Any
installment of interest or principal payable on any Note shall be paid on the
applicable Distribution Date to the Person in whose name such Note (or one or
more Predecessor Notes) is registered on the Record Date by check mailed
first-class postage prepaid to such Person's address as it appears on the Note
Register on such Record Date or, upon written request made to the Indenture
Trustee at least [ o ] Business Days prior to the related Record Date, by the
Holder of a Note having an initial Note Principal Amount of not less than
$2,500,000 by wire transfer in immediately available funds to an account
specified in the request and at the expense of such Noteholder, except that,
unless Definitive Notes have been issued pursuant to Section 2.11, with respect
to Notes registered on the Record Date in the name of the nominee of the
Clearing Agency (initially, such nominee to be Cede & Co.), payment will be made
by wire transfer in immediately available funds to the account designated by
such nominee, except for the final installment of principal payable with respect
to such Note on a Distribution Date or on the applicable Maturity Date for such
Notes (and except for the Redemption Price for any Note called for redemption
pursuant to Section 11.1), which shall be payable as provided below. The funds
represented by any such checks returned undelivered shall be held in accordance
with Section 3.3.
(b) The principal of each Note shall be payable in installments on each
Distribution Date as provided in the Servicing Agreement and in the forms of the
Notes set forth in Exhibit A hereto. Notwithstanding the foregoing, the entire
unpaid principal amount of the Notes shall be due and payable, if not previously
paid, on the earlier of (i) the applicable Maturity Date, (ii) the applicable
Redemption Date or (iii) the date on which an Event of Default shall have
occurred and be continuing, if the Indenture Trustee or the Majority of the
Noteholders shall have declared the Notes to be immediately due and payable in
the manner provided in Section 5.2 hereof.
(c) All principal payments on the Notes shall be made pro rata to the
Noteholders entitled thereto. The Indenture Trustee shall notify the Person in
whose name a Note is registered at the close of business on the Record Date
preceding the Distribution Date on which the Issuer expects that the final
installment of principal of and interest on such Note will be paid. Such notice
shall be mailed or transmitted by facsimile prior to such final Distribution
Date and shall specify that such final installment will be payable only upon
presentation and surrender of such Note and shall specify the place where such
Note may be presented and surrendered for payment of such installment. Notices
in connection with redemptions of Notes shall be mailed to Noteholders as
provided in Section 11.2 hereof.
SECTION 2.7 Cancellation. All Notes surrendered for payment, registration
of transfer or exchange shall, if surrendered to any Person other than the
Indenture Trustee, be delivered to the Indenture Trustee and shall be promptly
canceled by the Indenture Trustee. The Issuer shall deliver to the Indenture
Trustee for cancellation any Notes previously authenticated and delivered
hereunder which the Issuer may have acquired in any manner whatsoever, and all
Notes so delivered shall be promptly canceled by the Indenture Trustee. No Notes
shall be authenticated in lieu of or in exchange for any Notes canceled as
provided in this Section, except as expressly permitted by this Indenture. All
canceled Notes may be held or disposed of by the
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Indenture Trustee in accordance with its standard retention or disposal policy
as in effect at the time unless the Issuer shall direct by an Issuer Order that
they be destroyed or returned to it; provided, that such Issuer Order is timely
and the Notes have not been previously disposed of by the Indenture Trustee.
SECTION 2.8 Authentication of Notes.
(a) The Notes shall be authenticated by the Indenture Trustee, upon Issuer
Request and upon receipt by the Indenture Trustee of the following:
(i) An Issuer Order authorizing the execution and authentication of
such Notes;
(ii) All of the items of Collateral that are to be delivered to the
Indenture Trustee or its designee;
(iii) An executed counterpart of the Trust Agreement, the Indenture,
the Administration Agreement, the Assignment and Assumption Agreements and
the Servicing Agreement and an executed original of the Certificate of
Trust;
(iv) Except to the extent provided in subsection (b) below, Opinions
of Counsel addressed to the Indenture Trustee to the effect that:
(A) the Issuer has been duly formed and is validly existing as a
business trust under the laws of the State of Delaware, and has power,
authority and legal right to execute and deliver this Indenture and
the other Operative Agreements to which it is a party;
(B) the issuance of the Notes has been duly and validly
authorized by the Issuer;
(C) the Notes, when executed and authenticated in accordance with
the provisions of this Indenture and delivered against payment
therefor, will be the legal, valid and binding obligations of the
Issuer pursuant to the terms of this Indenture and will be entitled to
the benefits of this Indenture, and will be enforceable in accordance
with their terms, subject to bankruptcy, insolvency, reorganization,
arrangement, moratorium, fraudulent or preferential conveyance and
other similar laws of general application affecting the rights of
creditors generally and to general principles of equity (regardless of
whether such enforcement is considered in a proceeding in equity or at
law);
(D) all conditions precedent provided for in this Indenture
relating to the authentication of the Notes have been complied with;
(E) assuming due authorization, execution and delivery thereof by
the Indenture Trustee, this Indenture has been duly executed and
delivered by Issuer and constitutes the legal, valid and binding
obligation of the Issuer, enforceable against the Issuer in accordance
with its terms, subject to bankruptcy, insolvency,
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reorganization, arrangement, moratorium, fraudulent or preferential
conveyance and other similar laws of general application affecting the
rights of creditors generally and to general principles of equity
(regardless of whether such enforcement is considered in a proceeding
in equity or at law);
(F) the Issuer is not required to be registered under the
Investment Company Act of 1940, as amended;
(G) the Issuer will not be characterized as an association (or
publicly traded partnership) taxable as a corporation;
(H) the provisions of the Indenture are sufficient to create a
valid security interest in favor of the Indenture Trustee in the
Collateral; and
(I) this Indenture has been duly qualified under the Trust
Indenture Act.
(v) An Officer's Certificate of the Depositor on behalf of the Issuer
complying with the requirements of Section 13.1 and stating that:
(A) the Issuer is not in Default under this Indenture and the
issuance of the Notes will not result in any breach of any of the
terms, conditions or provisions of, or constitute a default under, any
indenture, mortgage, deed of trust or other agreement or instrument to
which the Issuer is a party or by which it is bound, or any order of
any court or administrative agency entered in any proceeding to which
the Issuer is a party or by which it may be bound or to which it may
be subject;
(B) the Issuer is the owner of all of the Mortgage Loans, has
not, other than pursuant to this Indenture, assigned any interest or
participation in the Mortgage Loans (or, if any such interest or
participation has been assigned, it has been released) and has the
right to Grant all of the Mortgage Loans to the Indenture Trustee;
(C) the Issuer has Granted to the Indenture Trustee all of its
right, title and interest in and to the Collateral, and has delivered
or caused the same to be delivered to the Indenture Trustee;
(D) attached thereto are true and correct copies of letters
signed by the Rating Agencies to the effect that the Notes has been
assigned the Required Rating; and
(E) all conditions precedent provided for in this Indenture
relating to the authentication and delivery of the Notes have been
complied with.
(b) The representations and warranties made pursuant to the foregoing
Officer's Certificate shall survive the discharge of this Indenture and may not
be waived by any party hereto. The Opinions of Counsel to be delivered pursuant
to subsection (a)(iv) above may differ
34
from the Opinions of Counsel described in such subsection so long as such
Opinions of Counsel so delivered are acceptable to the Rating Agencies and the
Indenture Trustee, the Indenture Trustee's authentication and delivery of the
Notes and the Rating Agencies' issuance of their letters pursuant to subsection
(a)(D) above and such acceptable opinions shall be deemed to be the Opinions of
Counsel required pursuant to subsection (a)(iv) above.
SECTION 2.9 Book-Entry Notes. The Notes will be issued in the form of
typewritten Notes or Global Securities representing the Book-Entry Notes, to be
delivered to DTC, the initial Clearing Agency, by, or on behalf of, the Issuer.
The Book-Entry Notes shall be registered initially on the Note Register in the
name of Cede & Co., the nominee of DTC, and no owner thereof will receive a
definitive Note representing such Note Owner's interest in such Note, except as
provided in Section 2.11. Unless and until definitive, fully registered Notes
(the "DEFINITIVE NOTES") have been issued to such Note Owners pursuant to
Section 2.11:
(i) the provisions of this Section shall be in full force and
effect;
(ii) the Note Registrar and the Indenture Trustee shall be
entitled to deal with the Clearing Agency for all purposes of this
Indenture (including the payment of principal of and interest on the
Notes and the giving of instructions or directions hereunder) as the
sole Holder of the Notes, and shall have no obligation to the Note
Owners;
(iii) to the extent that the provisions of this Section conflict
with any other provisions of this Indenture, the provisions of this
Section shall control;
(iv) the rights of Note Owners shall be exercised only through
the Clearing Agency and shall be limited to those established by law
and agreements between such Note Owners and the Clearing Agency and/or
the Clearing Agency Participants pursuant to the Note Depository
Agreement. Unless and until Definitive Notes are issued pursuant to
Section 2.11, the initial Clearing Agency will make Book-Entry
transfers among the Clearing Agency Participants and receive and
transmit payments of principal of and interest on the Notes to such
Clearing Agency Participants; and
(v) whenever this Indenture requires or permits actions to be
taken based upon instructions or directions of Holders of Notes
evidencing a specified percentage of the Outstanding Amount of the
Notes, the Clearing Agency shall be deemed to represent such
percentage only to the extent that it has received instructions to
such effect from Note Owners and/or Clearing Agency Participants
owning or representing, respectively, such required percentage of the
beneficial interest in the Notes and has delivered such instructions
to the Indenture Trustee.
SECTION 2.10 Notices to Clearing Agency. Whenever a notice or other
communication to the Noteholders is required under this Indenture, unless and
until Definitive Notes shall have been issued to such Note Owners pursuant to
Section 2.11, the Indenture Trustee shall give all such notices and
communications specified herein to be given to Holders of the Notes to the
Clearing Agency, and shall have no obligation to such Note Owners.
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SECTION 2.11 Definitive Notes. If (i) the Issuer advises the Indenture
Trustee in writing that the Clearing Agency is no longer willing or able to
properly discharge its responsibilities with respect to the Book-Entry Notes and
the Indenture Trustee is unable to locate a qualified successor, (ii) the Issuer
at its option advises the Indenture Trustee in writing that it elects to
terminate the Book-Entry system through the Clearing Agency or (iii) after the
occurrence of an Event of Default, Owners of the Book-Entry Notes representing
beneficial interests aggregating at least a majority of the Outstanding Amount
of Book-Entry Notes advise the Clearing Agency in writing that the continuation
of a Book-Entry system through the Clearing Agency is no longer in the best
interests of such Note Owners, then the Clearing Agency shall notify all Note
Owners and the Indenture Trustee of the occurrence of such event and of the
availability of Definitive Notes to Note Owners requesting the same. Upon
surrender to the Indenture Trustee of the typewritten Notes representing the
Book-Entry Notes by the Clearing Agency, accompanied by registration
instructions, the Issuer shall execute and the Indenture Trustee shall
authenticate the Definitive Notes in accordance with the instructions of the
Clearing Agency. None of the Issuer, the Note Registrar or the Indenture Trustee
shall be liable for any delay in delivery of such instructions, and each such
party may conclusively rely on, and shall be protected in relying on, such
instructions. Upon the issuance of Definitive Notes, the Indenture Trustee shall
recognize the Holders of the Definitive Notes as Noteholders.
SECTION 2.12 Tax. The Issuer has entered into this Indenture, and the Notes
will be issued, with the intention that, for federal, state and local income,
single business and franchise tax purposes, the Notes will qualify as
indebtedness of the Issuer secured by the Collateral. The Issuer, by entering
into this Indenture, and each Noteholder, by its acceptance of a Note (and each
Note Owner by its acceptance of an interest in the applicable Book-Entry Note),
agree to treat the Notes for federal, state and local income, single business
and franchise tax purposes as indebtedness of the Issuer.
SECTION 2.13 Release of Collateral.
(a) Except as otherwise provided in subsections (b) and (c) of this Section
and the terms of the Operative Agreements, the Indenture Trustee shall release
property from the lien of this Indenture only upon receipt by it of an Issuer
Request accompanied by (i) an Officer's Certificate, (ii) an Opinion of Counsel,
(iii) certificates in accordance with TIA Sections 314(c) and (d)(1), and
(iv)(A) Independent Certificates in accordance with TIA Sections 314(c) and
314(d)(1) or (B) an Opinion of Counsel in lieu of such Independent Certificates
to the effect that the TIA does not require any such Independent Certificates;
provided that no such Independent Certificates or Opinion of Counsel in lieu of
such Independent Certificates shall be necessary in respect of property released
from the lien of the Indenture in accordance with the provisions hereof if such
property consists solely of cash.
(b) The Master Servicer or any Servicer, on behalf of the Issuer, shall be
entitled to obtain a release from the lien of this Indenture for any Mortgage
Loan and the Mortgaged Property at any time (i) after a payment by the Seller or
the Issuer of the Purchase Price of the Mortgage Loan, (ii) after a Substitute
Mortgage Loan is substituted for such Mortgage Loan and payment of the
Substitution Amount, if any, (iii) after liquidation of the Mortgage Loan in
accordance with the applicable Servicing Agreement and the deposit of all
Liquidation Proceeds and Insurance Proceeds in the Collection Account, or (iv)
upon the termination of a Mortgage
36
Loan (due to, among other causes, a prepayment in full of the Mortgage Loan and
sale or other disposition of the related Mortgaged Property).
ARTICLE III
COVENANTS
SECTION 3.1 Payment of Principal and Interest. The Issuer will duly and
punctually pay (or will cause to be duly and punctually paid) the principal of
and interest on the Notes in accordance with the terms of the Notes and this
Indenture. Without limiting the foregoing, unless the Notes have been declared
due and payable pursuant to Section 5.2 and monies collected by the Indenture
Trustee are being applied in accordance with Section 5.4(b), subject to and in
accordance with Section 8.2, the Issuer will cause to be paid amounts on deposit
in the Distribution Account Account on each Distribution Date to the Holders of
the Notes. Amounts properly withheld under the Code by any Person from a payment
to any Noteholder of interest and/or principal shall be considered as having
been paid by the Issuer to such Noteholder for all purposes of this Indenture.
The Notes shall be non-recourse obligations of the Issuer and shall be
limited in right of payment to amounts available from the Collateral as provided
in this Indenture. The Issuer shall not otherwise be liable for payments of the
Notes, and none of the owners, agents, officers, directors, employees, Indenture
Trustees or successors or assigns of the Issuer shall be personally liable for
any amounts payable, or performance due, under the Notes or this Indenture. If
any other provision of this Indenture shall be deemed to conflict with the
provisions of this Section 3.1, the provisions of this Section 3.1 shall
control.
SECTION 3.2 Maintenance of Office or Agency. The Issuer will or will cause
the Indenture Trustee to maintain in [o], [o], an office or agency where Notes
may be surrendered for registration of transfer or exchange, and where notices
and demands to or upon the Issuer in respect of the Notes and this Indenture may
be served which initially shall be the Corporate Trust Office. The Issuer hereby
initially appoints the Indenture Trustee to serve as its agent for the foregoing
purposes and to serve as Paying Agent with respect to the Notes. The Issuer will
give prompt written notice to the Indenture Trustee of the appointment of new or
additional paying agents for the Notes, the location, and of any change in the
location, of any such office or agency. If at any time the Issuer shall fail to
maintain any such office or agency or shall fail to furnish the Indenture
Trustee with the address thereof, such surrenders, notices and demands may be
made or served at the Corporate Trust Office, and the Issuer hereby appoints the
Indenture Trustee as its agent to receive all such surrenders, notices and
demands.
SECTION 3.3 Money for Payments To Be Held in Trust. All payments of amounts
due and payable with respect to any Notes that are to be made from amounts
withdrawn from the Accounts shall be made on behalf of the Issuer by the
Indenture Trustee or by the Paying Agent.
On or before the Business Day preceding each Distribution Date and the
Redemption Date, the Paying Agent shall deposit or cause to be deposited in the
Distribution Account an aggregate sum sufficient to pay the amounts then
becoming due under the Notes, such sum to be
37
held in trust for the benefit of the Persons entitled thereto, and (unless the
Paying Agent is the Indenture Trustee) shall promptly notify the Indenture
Trustee of its action or failure so to act.
Any Paying Agent other than the Indenture Trustee shall be appointed by
Issuer Order with written notice thereof to the Indenture Trustee. Any Paying
Agent appointed by the Issuer shall be a Person who would be eligible to be
Indenture Trustee hereunder as provided in Section 6.11. The Issuer shall not
appoint any Paying Agent (other than the Indenture Trustee) which is not, at the
time of such appointment, a Depository Institution.
The Issuer will cause each Paying Agent (other than the Indenture Trustee)
to execute and deliver to the Indenture Trustee an instrument in which such
Paying Agent shall agree with the Indenture Trustee (and if the Indenture
Trustee acts as Paying Agent, it hereby so agrees), subject to the provisions of
this Section, that such Paying Agent will:
(i) hold all sums held by it for the payment of amounts due with
respect to the Notes in trust for the benefit of the Persons entitled
thereto until such sums shall be paid to such Persons or otherwise disposed
of as herein provided and pay such sums to such Persons as herein provided;
(ii) give the Indenture Trustee notice of any default by the Issuer
(or any other obligor upon the Notes) of which it has actual knowledge in
the making of any payment required to be made with respect to the Notes;
(iii) at any time during the continuance of any such default, upon the
written request of the Indenture Trustee, forthwith pay to the Indenture
Trustee all sums so held in trust by such Paying Agent;
(iv) immediately resign as a Paying Agent and forthwith pay to the
Indenture Trustee all sums held by it in trust for the payment of Notes if
at any time it ceases to meet the standards required to be met by a Paying
Agent at the time of its appointment; and
(v) comply with all requirements of the Code with respect to the
withholding from any payments made by it on any Notes of any applicable
withholding taxes imposed thereon and with respect to any applicable
reporting requirements in connection therewith; provided, however, that
with respect to withholding and reporting requirements applicable to
original issue discount (if any) on the Notes, the Issuer shall have first
provided the calculated amounts pertaining thereto to the Indenture
Trustee.
The Issuer may at any time, for the purpose of obtaining the satisfaction
and discharge of this Indenture or for any other purpose, by Issuer Order direct
any Paying Agent to pay to the Indenture Trustee all sums held in trust by such
Paying Agent, such sums to be held by the Indenture Trustee upon the same trusts
as those upon which the sums were held by such Paying Agent. Upon such payment
by any Paying Agent to the Indenture Trustee, such Paying Agent shall be
released from all further liability with respect to such money.
Subject to applicable laws with respect to escheat of funds or abandoned
property, any money held by the Indenture Trustee or any Paying Agent in trust
for the payment of any amount
38
due with respect to any Note and remaining unclaimed for two years after such
amount has become due and payable shall be discharged from such trust and be
paid to the Issuer on Issuer Request; and the Holder of such Note shall
thereafter, as an unsecured general creditor, look only to the Issuer for
payment thereof (but only to the extent of the amounts so paid to the Issuer),
and all liability of the Indenture Trustee or such Paying Agent with respect to
such trust money shall thereupon cease; provided, however, that the Indenture
Trustee or such Paying Agent, before being required to make any such repayment,
shall at the expense and direction of the Issuer cause to be published once, in
a newspaper published in the English language, customarily published on each
Business Day and of general circulation in [ o ], notice that such money remains
unclaimed and that, after a date specified therein, which shall not be less than
[ o ] days from the date of such publication, any unclaimed balance of such
money then remaining will be repaid to the Issuer. The Indenture Trustee shall
also adopt and employ, at the expense and direction of the Issuer, any other
reasonable means of notification of such repayment (including, but not limited
to, mailing notice of such repayment to Holders whose right to or interest in
moneys due and payable but not claimed is determinable from the records of the
Indenture Trustee or of any Paying Agent, at the last address of record for each
such Holder).
SECTION 3.4 Existence.
(a) The Issuer will keep in full effect its existence, rights and
franchises as a business trust under the laws of the State of Delaware (unless
it becomes, or any successor Issuer hereunder is or becomes, organized under the
laws of any other State or of the United States of America, in which case the
Issuer will keep in full effect its existence, rights and franchises under the
laws of such other jurisdiction) and will obtain and preserve its qualification
to do business in each jurisdiction in which such qualification is or shall be
necessary to protect the validity and enforceability of this Indenture, the
Notes and the Collateral.
(b) Any successor to the Owner Trustee appointed pursuant to Section [____]
of the Trust Agreement shall be the successor Owner Trustee under this Indenture
without the execution or filing of any paper, instrument or further act to be
done on the part of the parties hereto.
(c) Upon any consolidation or merger of or other succession to the Owner
Trustee, the Person succeeding to the Owner Trustee under the Trust Agreement
may exercise every right and power of the Owner Trustee under this Indenture
with the same effect as if such Person had been named as the Owner Trustee
herein.
SECTION 3.5 Protection of Collateral. The Issuer will from time to time,
and upon direction of the Majority of Noteholders, execute and deliver all such
supplements and amendments hereto and all such financing statements,
continuation statements, instruments of further assurance and other instruments,
and will take such other action necessary or advisable to:
(i) provide further assurance with respect to the Grant of all or any
portion of the Collateral;
39
(ii) maintain or preserve the lien and security interest (and the
priority thereof) of this Indenture or carry out more effectively the
purposes hereof;
(iii) perfect, publish notice of or protect the validity of any Grant
made or to be made by this Indenture;
(iv) enforce any rights with respect to the Collateral; or
(v) preserve and defend title to the Collateral and the rights of the
Indenture Trustee and the Noteholders in such Collateral against the claims
of all Persons and parties.
The Issuer hereby designates the Indenture Trustee its agent and
attorney-in-fact to execute any financing statement, continuation statement or
other instrument provided to the Indenture Trustee by the Depositor and required
to be executed pursuant to this Section 3.5.
SECTION 3.6 Opinions as to Trust Fund.
On the Closing Date, the Issuer shall furnish to the Securities
Administrator and the Indenture Trustee an Opinion of Counsel to the effect that
either, in the opinion of such counsel, such action has been taken with respect
to the recording and filing of this Indenture, any indentures supplemental
hereto, and any other requisite documents, and with respect to the execution and
filing of any financing statements and continuation statements, as are necessary
to make effective the lien and security interest of this Indenture, or stating
that, in the opinion of such counsel, no such action is necessary to make such
lien and security interest effective.
SECTION 3.7 Performance of Obligations.
(a) The Issuer will not take any action and will use its best efforts not
to permit any action to be taken by others that would release any Person from
any of such Person's material covenants or obligations under any instrument or
agreement included in the Collateral or that would result in the amendment,
hypothecation, subordination, termination or discharge of, or impair the
validity or effectiveness of, any such instrument or agreement, except as
expressly provided in this Indenture, the Servicing Agreement or such other
instrument or agreement.
(b) The Issuer may contract with or otherwise obtain the assistance of
other Persons to assist it in performing its duties under this Indenture, and
any performance of such duties by a Person identified to the Indenture Trustee
in an Officer's Certificate of the Issuer shall be deemed to be action taken by
the Issuer.
(c) The Issuer will punctually perform and observe all of its obligations
and agreements contained in this Indenture, any other agreements to which it is
a party and in the instruments and agreements included in the Collateral,
including but not limited to (i) filing or causing to be filed all UCC financing
statements and continuation statements required to be filed by the terms of this
Indenture and the Servicing Agreements and (ii) recording or causing to be
recorded all Mortgages, Assignments of Mortgage, all intervening Assignments of
Mortgage and all assumption and modification agreements required to be recorded
by the terms of the Servicing Agreements, in accordance with and within the time
periods provided for in this
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Indenture and/or the Servicing Agreements, as applicable. Except as otherwise
expressly provided therein, the Issuer shall not waive, amend, modify,
supplement or terminate any Agreement or any provision thereof without the
consent of the Indenture Trustee and the Holders of a majority of the
Outstanding Amount of the Notes.
(d) If the Issuer shall have knowledge of the occurrence of an Event of
Default under the Servicing Agreements, the Issuer shall promptly notify the
Indenture Trustee and the Rating Agencies thereof, and shall specify in such
notice the action, if any, the Issuer is taking with respect to such default.
(e) As promptly as possible after the giving of notice to the Master
Servicer of the termination of the Master Servicer's rights and powers pursuant
to Section [____] of the Servicing Agreement, the Indenture Trustee shall
proceed in accordance with Section [____] of the Servicing Agreement.
(f) Without derogating from the absolute nature of the assignment granted
to the Indenture Trustee under this Indenture or the rights of the Indenture
Trustee hereunder, the Issuer agrees that it will not, without the prior written
consent of a Majority of the Noteholders (i) amend, modify, waive, supplement,
terminate or surrender, or agree to any amendment, modification, supplement,
termination, waiver or surrender of, the terms of any Collateral (except to the
extent otherwise provided in the Servicing Agreement) or (ii) waive timely
performance or observance by the Seller under the Servicing Agreement. If any
such amendment, modification, supplement or waiver shall be so consented to by
the [Indenture Trustee] [such Holders], the Issuer agrees, promptly following a
request by the Indenture Trustee, to execute and deliver, in its own name and at
its own expense, such agreements, instruments, consents and other documents as
the Indenture Trustee may deem necessary or appropriate in the circumstances.
SECTION 3.8 Negative Covenants. So long as any Notes are Outstanding, the
Issuer shall not:
(a) except as expressly permitted by this Indenture, the Sale Agreement or
the Servicing Agreement, sell, transfer, exchange or otherwise dispose of any of
the properties or assets of the Issuer, including those included in the
Collateral, unless directed to do so by the Indenture Trustee;
(b) claim any credit on, or make any deduction from the principal or
interest payable in respect of, the Notes (other than amounts properly withheld
from such payments under the Code) or assert any claim against any present or
former Noteholder by reason of the payment of the taxes levied or assessed upon
any part of the Collateral;
(c) engage in any business or activity other than as permitted by the Trust
Agreement or other than in connection with, or relating to, the issuance of
Notes pursuant to this Indenture, or amend the Trust Agreement as in effect on
the Closing Date other than in accordance with Section [____] thereof;
(d) issue debt obligations under any other indenture;
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(e) incur or assume any indebtedness or guarantee any indebtedness of any
Person, except for such indebtedness as may be incurred by the Issuer in
connection with the issuance of the Notes pursuant to this Indenture;
(f) dissolve or liquidate in whole or in part or merge or consolidate with
any other Person; or
(g) (A) permit the validity or effectiveness of this Indenture to be
impaired, or permit the lien of this Indenture to be amended, hypothecated,
subordinated, terminated or discharged, or permit any Person to be released from
any covenants or obligations with respect to the Notes under this Indenture
except as may be expressly permitted hereby, (B) permit any lien, charge,
excise, claim, security interest, mortgage or other encumbrance (other than the
lien of this Indenture) to be created on or extend to or otherwise arise upon or
burden the Collateral or any part thereof or any interest therein or the
proceeds thereof (other than any junior liens or tax liens, mechanics' liens and
other liens that arise by operation of law, in each case on any of the Mortgaged
Properties and arising solely as a result of an action or omission of the
related Mortgagors), or (C) permit the lien of this Indenture not to constitute
a valid first priority (other than with respect to any such tax, mechanic's or
other lien) security interest in the Collateral.
SECTION 3.9 Covenants of the Issuer. All covenants of the Issuer in this
Indenture are covenants of the Issuer and are not covenants of the Owner
Trustee. The Owner Trustee is, and any successor Owner Trustee under the Trust
Agreement will be, entering into this Indenture solely as Owner Trustee under
the Trust Agreement and not in its respective individual capacity, and in no
case whatsoever shall the Owner Trustee or any such successor Owner Trustee be
personally liable on, or for any loss in respect of, any of the statements,
representations, warranties or obligations of the Issuer hereunder, as to all of
which the parties hereto agree to look solely to the property of the Issuer.
SECTION 3.10 Restricted Payments. The Issuer shall not, directly or
indirectly, (i) pay any dividend or make any distribution (by reduction of
capital or otherwise), whether in cash, property, securities or a combination
thereof, to the Owner Trustee or any owner of a beneficial interest in the
Issuer or otherwise with respect to any ownership or equity interest or security
in or of the Issuer, (ii) redeem, purchase, retire or otherwise acquire for
value any such ownership or equity interest or security or (iii) set aside or
otherwise segregate any amounts for any such purpose; provided, however, that
the Issuer may make, or cause to be made, (x) distributions to the Indenture
Trustee, the Owner Trustee, the Master Servicer, any Servicer and the
Securityholders as contemplated by, and to the extent funds are available for
such purpose under the Indenture, the Servicing Agreement or the Trust Agreement
and (y) payments to the Indenture Trustee pursuant to the Administration
Agreement. The Issuer will not, directly or indirectly, make or cause to be made
payments to or distributions from the Trust Accounts except in accordance with
this Indenture and the Operative Agreements.
SECTION 3.11 Treatment of Notes as Debt for Tax Purposes. The Issuer shall,
and shall cause the Indenture Trustee and the Master Servicer shall treat the
Notes as indebtedness for all federal, state and local income, single business
and franchise tax purposes and treat the Collateral as securing such
indebtedness.
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SECTION 3.12 Notice of Events of Default. The Issuer shall give the
Indenture Trustee and the Rating Agencies prompt written notice of each Event of
Default hereunder and each default on the part of the Depositor or the Master
Servicer under the Servicing Agreement.
SECTION 3.13 Further Instruments and Acts. Upon request of the Indenture
Trustee, the Issuer will execute and deliver such further instruments and do
such further acts as may be reasonably necessary or proper to carry out more
effectively the purpose of this Indenture.
SECTION 3.14 Annual Statement as to Compliance. So long as the Notes are
outstanding, the Issuer will deliver to the Indenture Trustee, within 120 days
after the end of each fiscal year of the Issuer (commencing with the fiscal year
200__), an Officer's Certificate stating, as to the Authorized Officer signing
such Officer's Certificate, that:
(a) a review of the activities of the Issuer during such year and of its
performance under this Indenture has been made under such Authorized Officer's
supervision; and
(b) to the best of such Authorized Officer's knowledge, based on such
review, the Issuer has complied with all conditions and covenants under this
Indenture throughout such year, or, if there has been a default in its
compliance with any such condition or covenant, specifying each such default
known to such Authorized Officer and the nature and status thereof.
SECTION 3.15 Representations and Warranties of the Issuer. The Issuer
hereby represents and warrants that:
(a) this Agreement creates a valid and continuing security interest (as
defined in the UCC) in the Collateral in favor of the Indenture Trustee, which
security interest is prior to all other liens, and is enforceable as such as
against creditors of and purchasers from the Issuer;
(b) the Collateral constitutes "instruments" within the meaning of the UCC;
(c) the Issuer owns and has good and marketable title to the Collateral
free and clear of any lien, claim or encumbrance of any Person;
(d) the Issuer has received all consents and approvals required by the
terms of the Collateral to pledge the Collateral hereunder to the Indenture
Trustee;
(e) the Issuer has caused or will have caused, within [ o ] days from the
Closing Date, the filing of all appropriate financing statements in the proper
filing office in the appropriate jurisdictions under applicable law in order to
perfect the security interest in the Collateral granted to the Indenture Trustee
hereunder;
(f) all original executed copies of each Mortgage Note that constitute or
evidence the Collateral have been delivered to the Indenture Trustee or the
applicable Custodian on behalf of the Indenture Trustee;
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(g) the Issuer has received a written acknowledgment from the applicable
Custodian that such Custodian is holding the Mortgage Notes that constitute or
evidence the Collateral solely on behalf and for the benefit of the Indenture
Trustee;
(h) other than the security interest granted to the Indenture Trustee
pursuant to this Agreement, the Issuer has not pledged, assigned, sold, granted
a security interest in, or otherwise conveyed any of the Collateral. The Issuer
has not authorized the filing of and is not aware of any financing statements
against the Issuer that include a description of collateral covering the
Collateral other than any financing statement relating to the security interest
granted to the Indenture Trustee hereunder or that has been terminated. The
Issuer is not aware of any judgment or tax lien filings against the Issuer; and
(i) none of the Mortgage Notes that constitute or evidence the Collateral
has any marks or notations indicating that they have been pledged, assigned or
otherwise conveyed to any Person other than the Secured Party.
SECTION 3.16 Annual Opinions as to Collateral. On or before March 15th in
each calendar year, beginning in 200__, the Issuer shall furnish to the
Indenture Trustee an Opinion of Counsel either stating that, in the opinion of
such counsel, such action has been taken with respect to the recording, filing,
re-recording and refiling of this Indenture, any indentures supplemental hereto
and any other requisite documents and with respect to the execution and filing
of any financing statements and continuation statements as is necessary to
maintain the lien and security interest created by this Indenture and reciting
the details of such action or stating that in the opinion of such counsel no
such action is necessary to maintain such lien and security interest. Such
Opinion of Counsel shall also describe the recording, filing, rerecording and
refiling of this Indenture, any indentures supplemental hereto and any other
requisite documents and the execution and filing of any financing statements and
continuation statements that will, in the opinion of such counsel, be required
to maintain the lien and security interest of this Indenture until March 15th of
the following calendar year.
ARTICLE IV
SATISFACTION AND DISCHARGE
SECTION 4.1 Satisfaction and Discharge of Indenture. This Indenture shall
be discharged and cease to be of further effect with respect to the Notes and
Collateral securing the Notes when either (i) the Servicing Agreement has been
terminated pursuant to Article VII or (ii) all of the following have occurred:
(a) either
(i) all Notes theretofore authenticated and delivered (other than (A)
Notes that have been mutilated, destroyed, lost or stolen and that have
been replaced or paid as provided in Section 2.4 and (B) Notes for whose
payment money has theretofore been deposited in trust or segregated and
held in trust by the Issuer and thereafter repaid to the Issuer or
discharged from such trust, as provided in Section 3.3) have been delivered
to the Indenture Trustee for cancellation; or
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(ii) all Notes not theretofore delivered to the Indenture Trustee for
cancellation (A) have become due and payable, (B) will become due and
payable within one year of the Maturity Date, or (C) are to be called for
redemption within one year under arrangements satisfactory to the Indenture
Trustee for the giving of notice of redemption by the Indenture Trustee in
the name, and at the expense, of the Issuer, and the Issuer has irrevocably
deposited or caused to be irrevocably deposited with the Indenture Trustee
cash or direct obligations of or obligations guaranteed by the United
States of America (which will mature prior to the date such amounts are
payable), in trust for such purpose, in an amount sufficient to pay and
discharge the entire indebtedness on such Notes to the Maturity Date of the
Notes or the Redemption Date (if Notes are called for redemption pursuant
to Section 11.1 hereof), as the case may be;
(b) the later of (i) eighteen months after payment in full of all
outstanding obligations under the Notes and (ii) the date on which the Issuer
has paid or caused to be paid all other sums payable hereunder and no other
amounts will become due and payable by the Issuer; and
(c) the Issuer has delivered to the Indenture Trustee an Officer's
Certificate and an Opinion of Counsel (at the Issuer's expense) and (if required
by the TIA or the Indenture Trustee) an Independent Certificate from a firm of
certified public accountants, each meeting the applicable requirements of
Section 13.1(a) hereof and, subject to Section 13.2 hereof, each stating that
all conditions precedent herein provided for relating to the satisfaction and
discharge of this Indenture with respect to the Notes have been satisfied,
then, upon Issuer Request, this Indenture and the lien, rights, and interests
created hereby shall cease to be of further effect with respect to the Notes
(except as to (i) rights of registration of transfer and exchange, (ii)
substitution of mutilated, destroyed, lost or stolen Notes, (iii) rights of
Noteholders to receive payments of principal thereof and interest thereon, (iv)
Sections 3.3, 3.4, 3.5, 3.8 and 3.9 hereof, (v) the rights, obligations and
immunities of the Indenture Trustee hereunder (including the rights of the
Indenture Trustee under Section 6.7 and the obligations of the Indenture Trustee
under Section 4.2) and (vi) the rights of Noteholders as beneficiaries hereof
with respect to the property so deposited with the Indenture Trustee payable to
all or any of them), and the Indenture Trustee, on demand of and at the expense
of the Issuer, shall execute and deliver proper instruments acknowledging
satisfaction and discharge of this Indenture with respect to the Notes, and
shall pay, or assign or transfer and deliver, to or at the direction of the
Issuer, all Collateral held by it after satisfaction of the conditions specified
in clauses (b) and (c) above.
SECTION 4.2 Application of Trust Money. All moneys deposited with the
Indenture Trustee pursuant to Sections 3.3 and 4.1 hereof shall be held in trust
and applied by it, in accordance with the provisions of the Notes and this
Indenture, to the payment, either directly or through any Paying Agent, as the
Indenture Trustee may determine, to the Holders of the Notes for the payment of
all sums due and to become due thereon for principal and interest; but such
moneys need not be segregated from other funds except to the extent required
herein or in the Servicing Agreement or otherwise required by law.
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ARTICLE V
EVENTS OF DEFAULT; REMEDIES
SECTION 5.1 Events of Default.
(a) "Event of Default," wherever used herein, means any one of the
following events (whatever the reason for such Event of Default and whether it
shall be voluntary or involuntary or be effected by operation of law or pursuant
to any judgment, decree or order of any court or any order, rule or regulation
of any administrative or governmental body):
(i) a default in the payment of Current Interest or Principal in
respect of the Notes when the same becomes due and payable, and the
continuance of such default for a period of [ o ] days; or
(ii) a default in the payment of the entire Principal Note Amount of
any Note on the applicable Maturity Date; or
(iii) either the Issuer or the pool of Collateral becomes an
"investment company" required to be registered under the Investment Company
Act of 1940, as amended; or
(iv) default in the observance or performance of any covenant or
agreement of the Issuer made in this Indenture (other than a covenant or
agreement, a default in the observance or performance of which is elsewhere
in this Section specifically dealt with), or any representation or warranty
of the Issuer made in this Indenture, the Servicing Agreement or in any
certificate or other writing delivered pursuant hereto or in connection
herewith proving to have been incorrect in any material respect as of the
time when the same shall have been made, and such default shall continue or
not be cured, or the circumstance or condition in respect of which such
representation or warranty was incorrect shall not have been eliminated or
otherwise cured, for a period of [ o ] days after there shall have been
given, by registered or certified mail, to the Issuer by the Indenture
Trustee or to the Issuer and the Indenture Trustee by the Holders of at
least 25% of the Outstanding Amount of the Notes, a written notice
specifying such default or incorrect representation or warranty and
requiring it to be remedied and stating that such notice is a notice of
Default hereunder; or
(v) the filing of a decree or order for relief by a court having
jurisdiction in the premises in respect of the Issuer or any substantial
part of the Collateral in an involuntary case under any applicable federal
or state bankruptcy, insolvency or other similar law now or hereafter in
effect, or appointing a receiver, liquidator, assignee, custodian,
Indenture Trustee, sequestrator or similar official of the Issuer or for
any substantial part of the Collateral, or ordering the winding-up or
liquidation of the Issuer's affairs, and such decree or order shall remain
unstayed and in effect for a period of [ o ] consecutive days; or
46
(vi) the commencement by the Issuer of a voluntary case under any
applicable federal or state bankruptcy, insolvency or other similar law now
or hereafter in effect, or the consent by the Issuer to the entry of an
order for relief in an involuntary case under any such law, or the consent
by the Issuer to the appointment or taking possession by a receiver,
liquidator, assignee, custodian, Indenture Trustee, sequestrator or similar
official of the Issuer or for any substantial part of the Collateral, or
the making by the Issuer of any general assignment for the benefit of
creditors, or the failure by the Issuer generally to pay its debts as such
debts become due, or the taking of any action by the Issuer in furtherance
of any of the foregoing.
(b) The Issuer shall deliver to a Responsible Officer of the Indenture
Trustee, within [ o ] days after the occurrence thereof, written notice in the
form of an Officer's Certificate of any event which with the giving of notice
and the lapse of time would become an Event of Default, its status and what
action the Issuer is taking or proposes to take with respect thereto.
SECTION 5.2 Acceleration of Maturity; Rescission and Annulment.
(a) If an Event of Default should occur and be continuing of which a
Responsible Officer of the Indenture Trustee has actual knowledge, then and in
every such case the Indenture Trustee may, and shall at the direction of the
Majority Noteholders, declare all the Notes to be immediately due and payable,
by a notice in writing to the Issuer and the Indenture Trustee, and upon any
such declaration the unpaid principal amount of such Notes, together with
accrued and unpaid interest thereon through the date of acceleration, shall
become immediately due and payable.
(b) At any time after such declaration of acceleration of maturity has been
made and before a judgment or decree for payment of the money due has been
obtained by the Indenture Trustee as hereinafter in this Article V provided, the
Noteholders, by written notice to the Issuer and the Indenture Trustee, may
rescind and annul such declaration and its consequences if the Issuer has paid
or deposited with the Indenture Trustee a sum sufficient to pay:
(i) all payments of principal of and interest on all Notes and all
other amounts that would then be due hereunder or upon such Notes if the
Event of Default giving rise to such acceleration had not occurred; and
(ii) all sums paid or advanced by the Indenture Trustee hereunder and
the reasonable compensation, expenses, disbursements and advances of [each
of] the Indenture Trustee and its agents and counsel; and
(iii) all Events of Default, other than the nonpayment of the
principal of the Notes that has become due solely by such acceleration,
have been cured or waived as provided in Section 5.11.
No such rescission shall affect any subsequent default or impair any right
consequent thereto.
SECTION 5.3 Collection of Indebtedness and Suits for Enforcement by
Indenture Trustee.
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(a) The Issuer covenants that if default is made in the payment of any
interest on any Note when the same becomes due and payable, and such default
continues for a period of [ o ] days, the Issuer will, upon demand of the
Indenture Trustee or at the direction of a Majority of the Noteholders, pay to
the Indenture Trustee, for the benefit of the Holders of the Notes, the whole
amount then due and payable on such Notes for interest and in addition thereto
such further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Indenture Trustee and its agents and counsel.
(b) In case the Issuer shall fail forthwith to pay such amounts upon such
demand, the Indenture Trustee, in its own name and as Indenture Trustee of an
express trust may, and shall, at the direction of a Majority of the Noteholders,
institute a Proceeding for the collection of the sums so due and unpaid, and may
prosecute such Proceeding to judgment or final decree, and may enforce the same
against the Issuer or other obligor upon such Notes and collect in the manner
provided by law out of the property of the Issuer or other obligor upon such
Notes, wherever situated, the monies adjudged or decreed to be payable.
(c) If an Event of Default occurs and is continuing, the Indenture Trustee
may, in its discretion, and shall, at the direction of a Majority of the
Noteholders, as more particularly provided in Section 5.4, proceed to protect
and enforce its rights and the rights of the Noteholders, by such appropriate
Proceedings as the Indenture Trustee shall deem most effective to protect and
enforce any such rights, whether for the specific enforcement of any covenant or
agreement in this Indenture or in aid of the exercise of any power granted
herein, or to enforce any other proper remedy or legal or equitable right vested
in the Indenture Trustee by this Indenture or by law.
(d) In case there shall be pending, relative to the Issuer or any other
obligor upon the Notes or any Person having or claiming an ownership interest in
the Collateral, Proceedings under Title 11 of the United States Code or any
other applicable federal or state bankruptcy, insolvency or other similar law,
or in case a receiver, assignee or Indenture Trustee in bankruptcy or
reorganization, liquidator, sequestrator or similar official shall have been
appointed for or taken possession of the Issuer or its property or such other
obligor or Person, or in case of any other comparable judicial Proceedings
relative to the Issuer or other obligor upon the Notes, or to the creditors or
property of the Issuer or such other obligor, the Indenture Trustee,
irrespective of whether the principal of any Notes shall then be due and payable
as therein expressed or by declaration or otherwise and irrespective of whether
the Indenture Trustee shall have made any demand pursuant to the provisions of
this Section, shall be entitled and empowered, upon the direction of a Majority
of the Noteholders, by intervention in such Proceedings or otherwise:
(i) to file and prove a claim or claims for the whole amount of
principal and interest owing and unpaid in respect of the Notes and to file
such other papers or documents as may be necessary or advisable in order to
have the claims of the Indenture Trustee (including any claim for
reasonable compensation to the Indenture Trustee, each predecessor
Indenture Trustee, and their respective agents, attorneys and counsel, and
for reimbursement of all expenses and liabilities incurred, and all
advances made, by the
48
Indenture Trustee and each predecessor Indenture Trustee (except as a
result of negligence or bad faith)) and of the Noteholders allowed in such
Proceedings;
(ii) unless prohibited by applicable law and regulations, to vote on
behalf of the Holders of Notes in any election of a Indenture Trustee, a
standby Indenture Trustee or Person performing similar functions in any
such Proceedings;
(iii) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute all amounts received with
respect to the claims of the Noteholders and the Indenture Trustee on their
behalf;
(iv) to file such proofs of claim and other papers or documents as may
be necessary or advisable in order to have the claims of the Indenture
Trustee or the Holders of Notes allowed in any judicial proceedings
relative to the Issuer, its creditors and its property; and any Indenture
Trustee, receiver, liquidator, custodian or other similar official in any
such Proceeding is hereby authorized by each of such Noteholders to make
payments to the Indenture Trustee and, in the event that the Indenture
Trustee shall consent to the making of payments directly to such
Noteholders to pay to the Indenture Trustee such amounts as shall be
sufficient to cover reasonable compensation to the Indenture Trustee, each
predecessor Indenture Trustee and their respective agents, attorneys and
counsel, and all other expenses and liabilities incurred, and all advances
made, by the Indenture Trustee and each predecessor Indenture Trustee
except as a result of negligence or bad faith;
(v) nothing herein contained shall be deemed to authorize the
Indenture Trustee to authorize or consent to or vote for or accept or adopt
on behalf of any Noteholder
(vi) any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Holder thereof or to
authorize the Indenture Trustee to vote in respect of the claim of any
Noteholder in any such proceeding except, as aforesaid, to vote for the
election of a Indenture Trustee in bankruptcy or similar Person;
(vii) all rights of action and of asserting claims under this
Indenture, or under any of the Notes, may be enforced by the Indenture
Trustee without the possession of any of the Notes or the production
thereof in any trial or other Proceedings relative thereto, and any such
action or Proceedings instituted by the Indenture Trustee shall be brought
in its own name as Indenture Trustee of an express trust, and any recovery
of judgment, subject to the payment of the expenses, disbursements and
compensation of the Indenture Trustee, each predecessor Indenture Trustee
and their respective agents and attorneys, shall be for the ratable benefit
of the Holders of the Notes; and
(viii) in any Proceedings brought by the Indenture Trustee (and also
any Proceedings involving the interpretation of any provision of this
Indenture to which the Indenture Trustee shall be a party), the Indenture
Trustee shall be held to represent all the
49
Noteholders, and it shall not be necessary to make any Noteholder a party
to any such Proceedings.
SECTION 5.4 Remedies; Priorities.
(a) If an Event of Default shall have occurred and be continuing, of which
a Responsible Officer of the Indenture Trustee has actual knowledge, the
Indenture Trustee may, and at the direction of the Majority of the Noteholders
shall, do one or more of the following (subject to Section 5.5):
(i) institute Proceedings in its own name (as Indenture Trustee) and
as Indenture Trustee of an express trust for the collection of all amounts
then payable on the Notes or under this Indenture with respect thereto,
whether by declaration or otherwise, enforce any judgment obtained, and
collect from the Issuer and any other obligor upon such Notes monies
adjudged due;
(ii) institute Proceedings from time to time for the complete or
partial foreclosure of this Indenture with respect to the Collateral;
(iii) exercise any remedies of a secured party under the UCC and take
any other appropriate action to protect and enforce the rights and remedies
of the Indenture Trustee or the Noteholders; and
(iv) sell the Collateral or any portion thereof or rights or interest
therein in a commercially reasonable manner, at one or more public or
private sales called and conducted in any manner permitted by law;
provided, however, that the Indenture Trustee may not sell or otherwise
liquidate the Collateral following an Event of Default, unless (A) the Holders
of 100% of the Outstanding Amount of the Notes consent thereto, (B) the proceeds
of such sale or liquidation distributable to the Noteholders are sufficient to
discharge in full all amounts then due and unpaid upon the Notes for principal
and interest or (C) the Indenture Trustee determines that the Collateral will
not continue to provide sufficient funds for the payment of principal of and
interest on the Notes as they would have become due if the Notes had not been
declared due and payable, and the Indenture Trustee obtains the consent of
Holders of 66-2/3% of the Outstanding Amount of the Notes. In determining such
sufficiency or insufficiency with respect to clauses (B) and (C), the Indenture
Trustee shall obtain at the cost of the Issuer and rely upon an opinion of an
Independent investment banking or accounting firm of national reputation as to
the feasibility of such proposed action and as to the sufficiency of the
Collateral for such purpose.
(b) If the Indenture Trustee collects any money or property pursuant to
this Article V, it shall pay out the money or property in the following order:
first: to the Indenture Trustee, for any costs or expenses incurred by
it in connection with the enforcement of the remedies provided for in
this Article V and for any other unpaid amounts due to the Indenture
Trustee hereunder, to the Custodians for any amounts due and owing to
them under the Custodial Agreements, and to the Owner Trustee, to the
extent of any fees and expenses due
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and owing to it (including pursuant to Section 7.02 of the Trust
Agreement) and for any other unpaid amounts due to the Owner Trustee
hereunder;
second: to the Master Servicer and Servicers for any Master Servicing
Fees or Servicing Fees then due and unpaid and any unreimbursed
Advances and other servicing advances; and
third: to the Notes, all accrued and unpaid interest thereon and
amounts in respect of principal; provided, however, that accrued and
unpaid interest shall be paid to Noteholders before any payments in
respect of principal.
The Indenture Trustee may fix a record date and Distribution Date for any
payment to be made to the Noteholders pursuant to this Section. At least [ o ]
days before such record date, the Indenture Trustee shall mail to each
Noteholder and the Issuer a notice that states the record date, the Distribution
Date and the amount to be paid.
SECTION 5.5 Limitation of Suits. No Holder of any Note shall have any right
to institute any Proceeding, judicial or otherwise, with respect to this
Indenture or for the appointment of a receiver or Indenture Trustee, or for any
other remedy hereunder, unless:
(a) such Holder has previously given written notice to the Indenture
Trustee of a continuing Event of Default;
(b) a Majority of the Noteholders have made written request to the
Indenture Trustee to institute such Proceeding in respect of such Event of
Default in its own name as Indenture Trustee hereunder;
(c) such Holder or Holders have offered to the Indenture Trustee reasonable
indemnity against the costs, expenses and liabilities to be incurred in
complying with such request;
(d) the Indenture Trustee for [ o ] days after its receipt of such notice,
request and offer of indemnity has failed to institute such Proceedings; and
(e) no direction inconsistent with such written request has been given to
the Indenture Trustee during such 60-day period by the Majority of the
Noteholders.
It is understood and intended that no one or more Holders of Notes shall
have any right in any manner whatever by virtue of, or by availing of, any
provision of this Indenture to affect, disturb or prejudice the rights of any
other Holders of Notes or to obtain or to seek to obtain priority or preference
over any other Holders or to enforce any right under this Indenture, except in
the manner herein provided.
In the event the Indenture Trustee shall receive conflicting or
inconsistent requests and indemnity from two or more groups of Holders of Notes
pursuant to this Section, each representing less than the Majority of the
Noteholders, the Indenture Trustee in its sole discretion may determine what
action, if any, shall be taken, notwithstanding any other provision of this
Indenture.
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SECTION 5.6 Unconditional Rights of Noteholders To Receive Principal and
Interest. Notwithstanding any other provisions in this Indenture, the Holder of
any Note shall have the right, which is absolute and unconditional, to receive
payment of the principal of and interest on, such Note on or after the Maturity
Date (or, in the case of redemption, on or after the Redemption Date) and to
institute suit for the enforcement of any such payment, and such right shall not
be impaired without the consent of such Holder.
SECTION 5.7 Restoration of Rights and Remedies. If the Indenture Trustee or
any Noteholder has instituted any Proceeding to enforce any right or remedy
under this Indenture and such Proceeding has been discontinued or abandoned for
any reason or has been determined adversely to the Indenture Trustee or to such
Noteholder, then and in every such case the Issuer, the Indenture Trustee and
the Noteholders shall, subject to any determination in such Proceeding, be
restored severally and respectively to their former positions hereunder, and
thereafter all rights and remedies of the Indenture Trustee and the Noteholders
shall continue as though no such Proceeding had been instituted.
SECTION 5.8 Rights and Remedies Cumulative. No right or remedy herein
conferred upon or reserved to the Indenture Trustee or to the Noteholders is
intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at law
or in equity or otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
SECTION 5.9 Delay or Omission Not a Waiver. No delay or omission of the
Indenture Trustee or any Holder of any Note to exercise any right or remedy
accruing upon any Default or Event of Default shall impair any such right or
remedy or constitute a waiver of any such Default or Event of Default or an
acquiescence therein. Every right and remedy given by this Article V or by law
to the Indenture Trustee or to the Noteholders may be exercised from time to
time, and as often as may be deemed expedient, by the Indenture Trustee or by
the Noteholders, as the case may be
SECTION 5.10 Control by Noteholders.
The Majority of the Noteholders shall have the right to direct the time,
method and place of conducting any Proceeding for any remedy available to the
Indenture Trustee with respect to the Notes or exercising any trust or power
conferred on the Indenture Trustee; provided that:
(a) such direction shall not be in conflict with any rule of law or with
this Indenture;
(b) subject to the express terms of Section 5.4, any direction to the
Indenture Trustee to sell or liquidate the Collateral shall be by not less than
100% of the Outstanding Amount of the Notes; and
(c) the Indenture Trustee may take any other action deemed proper by the
Indenture Trustee that is not inconsistent with such direction.
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Notwithstanding the rights of the Noteholders set forth in this Section,
subject to Section 6.1, the Indenture Trustee need not take any action that it
determines might involve it in liability or might materially adversely affect
the rights of any Noteholders not consenting to such action.
SECTION 5.11 Waiver of Past Defaults.
Prior to the declaration of the acceleration of the maturity of the Notes
as provided in Section 5.2, the Majority of the Noteholders may waive any past
Default or Event of Default and its consequences except a Default (a) in the
payment of interest on any of the Notes or (b) in respect of a covenant or
provision hereof that cannot be modified or amended without the consent of the
Holder of each Note, as applicable. In the case of any such waiver, the Issuer,
the Indenture Trustee and the Holders of the Notes shall be restored to their
former positions and rights hereunder, respectively, but no such waiver shall
extend to any subsequent or other Default or impair any right consequent
thereto.
Upon any such waiver, such Default shall cease to exist and be deemed to
have been cured and not to have occurred, and any Event of Default arising
therefrom shall be deemed to have been cured and not to have occurred, for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other Default or Event of Default or impair any right consequent thereto.
SECTION 5.12 Undertaking for Costs. All parties to this Indenture agree,
and each Holder of any Note by such Holder's acceptance thereof shall be deemed
to have agreed, that any court may in its discretion require, in any suit for
the enforcement of any right or remedy under this Indenture, or in any suit
against the Indenture Trustee for any action taken, suffered or omitted by it as
Indenture Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the
provisions of this Section shall not apply to (a) any suit instituted by the
Indenture Trustee, (b) any suit instituted by any Noteholder, or group of
Noteholders, in each case holding in the aggregate more than 10% of the
Outstanding Amount of the Notes or (c) any suit instituted by any Noteholder for
the enforcement of the payment of principal of or interest on any Note on or
after the respective due dates expressed in such Note and in this Indenture.
SECTION 5.13 Waiver of Stay or Extension Laws. The Issuer covenants (to the
extent that it may lawfully do so) that it will not at any time insist upon, or
plead or in any manner whatsoever, claim or take the benefit or advantage of,
any stay or extension law wherever enacted, now or at any time hereafter in
force, that may affect the covenants or the performance of this Indenture; and
the Issuer (to the extent that it may lawfully do so) hereby expressly waives
all benefit or advantage of any such law, and covenants that it will not hinder,
delay or impede the execution of any power herein granted to the Indenture
Trustee, but will suffer and permit the execution of every such power as though
no such law had been enacted.
SECTION 5.14 Action on Notes. The Indenture Trustee's right to seek and
recover judgment on the Notes or under this Indenture shall not be affected by
the seeking, obtaining or application of any other relief under or with respect
to this Indenture. Neither the
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lien of this Indenture nor any rights or remedies of the Indenture Trustee or
the Noteholders shall be impaired by the recovery of any judgment by the
Indenture Trustee against the Issuer or by the levy of any execution under such
judgment upon any portion of the Collateral or upon any of the assets of the
Issuer. Any money or property collected by the Indenture Trustee shall be
applied in accordance with Section 5.4(b).
SECTION 5.15 Optional Preservation of the Collateral. If the Notes have
been declared to be due and payable under Section 5.2 following an Event of
Default and such declaration and its consequences have not been rescinded and
annulled, the Indenture Trustee may, but need not, elect to maintain possession
of the Collateral. It is the desire of the parties hereto and the Noteholders
that there be at all times sufficient funds for the payment of principal of and
interest on the Notes, and the Indenture Trustee shall take such desire into
account when determining whether or not to maintain possession of the
Collateral. In determining whether to maintain possession of the Collateral, the
Indenture Trustee may, but need not, obtain and rely upon an opinion (at the
expense of the Issuer) of an Independent investment banking or accounting firm
of national reputation as to the feasibility of such proposed action and as to
the sufficiency of the Collateral for such purpose.
SECTION 5.16 Performance and Enforcement of Certain Obligations. (a)
Promptly following a request from the Indenture Trustee to do so and at the
Issuer's expense, the Issuer shall take all such lawful action as the Indenture
Trustee may request to compel or secure the performance and observance by the
Seller and the Master Servicer, as applicable, of each of their obligations to
the Issuer under or in connection with the Mortgage Loan Sale Agreement and the
Servicing Agreement, and to exercise any and all rights, remedies, powers and
privileges lawfully available to the Issuer under or in connection with the
Servicing Agreement to the extent and in the manner directed by the Indenture
Trustee, including the transmission of notices of default on the part of the
Seller or the Master Servicer thereunder and the institution of legal or
administrative actions or proceedings to compel or secure performance by the
Seller or the Master Servicer of each of their obligations under the Servicing
Agreement and the Sale Agreement.
(b) If an Event of Default of which a Responsible Officer of the Indenture
Trustee has actual knowledge has occurred and is continuing, the Indenture
Trustee may, and at the direction (which direction shall be in writing or by
telephone, confirmed in writing promptly thereafter) of a Majority of the
Noteholders shall, exercise all rights, remedies, powers, privileges and claims
of the Issuer against the Master Servicer under or in connection with the
Servicing Agreement or the Seller under or in connection with the Mortgage Loan
Sale Agreement, including the right or power to take any action to compel or
secure performance or observance by the Seller or the Master Servicer of each of
their obligations to the Issuer thereunder and to give any consent, request,
notice, direction, approval, extension, or waiver under the Servicing Agreement
or Mortgage Loan Sale Agreement, and any right of the Issuer to take such action
shall be suspended.
ARTICLE VI
THE INDENTURE TRUSTEE
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SECTION 6.1 Duties of Indenture Trustee.
(a) If an Event of Default has occurred and is continuing, the Indenture
Trustee shall exercise the rights and powers vested in it by this Indenture 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.
(b) Except during the continuance of an Event of Default:
(i) the Indenture Trustee undertakes to perform such duties and only
such duties as are specifically set forth in this Indenture, the Indenture
Trustee shall not be liable except for the performance of such duties and
obligations as are specifically set forth in this Indenture and no implied
covenants or obligations shall be read into this Indenture against the
Indenture Trustee; and
(ii) in the absence of bad faith on its part, the Indenture Trustee
may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Indenture Trustee and conforming to the
requirements of this Indenture; however, the Indenture Trustee shall
examine the certificates and opinions to determine whether or not they
conform to the requirements of this Indenture.
(c) The Indenture Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(i) this paragraph does not limit the effect of paragraph (b) of this
Section;
(ii) the Indenture Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer unless it is proved
that the Indenture Trustee was negligent in ascertaining the pertinent
facts;
(iii) the Indenture Trustee shall not be liable with respect to any
action it takes or omits to take in good faith in accordance with this
Agreement or upon a direction received by it pursuant to Section 5.10
hereof;
(iv) the Indenture Trustee shall not be liable for interest on any
money received by it except as the Indenture Trustee may agree in writing
with the Issuer;
(v) money held in trust by the Indenture Trustee shall be segregated
from other funds except to the extent permitted by law or the terms of this
Indenture or the Servicing Agreement;
(vi) no provision of this Indenture shall require the Indenture
Trustee 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 it shall have reasonable
grounds to believe that repayment of such funds or adequate indemnity
against such risk or liability is not reasonably assured to it;
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(vii) every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Indenture Trustee
shall be subject to the provisions of this Section and to the provisions of
the TIA;
(viii) the Indenture Trustee shall not be required to take notice or
be deemed to have notice or knowledge of any default or Event of Default
(except an Event of Default described in Section 5.01(a)(i)) unless a
Responsible Officer of the Indenture Trustee shall have actual knowledge
thereof; in the absence of such actual knowledge, the Indenture Trustee may
conclusively assume that there is no default or Event of Default; and
(ix) anything in this Agreement to the contrary notwithstanding, in no
event shall the Indenture Trustee be liable for special, indirect or
consequential loss or damage of any kind whatsoever (including but not
limited to lost profits), even if the Indenture Trustee has been advised of
the likelihood of such loss or damage and regardless of the form of action.
(d) The Indenture Trustee shall not have any duty or obligation to
manage, make any payment with respect to, register, record, sell, dispose
of, or otherwise deal with the Collateral, or to otherwise take or refrain
from taking any action under, or in connection with, any document
contemplated hereby to which the Indenture Trustee is a party, except as
expressly provided (i) in accordance with the powers granted to and the
authority conferred upon the Indenture Trustee pursuant to this Agreement
or any other Operative Agreement, and (ii) in accordance with any document
or instruction delivered to the Indenture Trustee pursuant to the terms of
this Agreement; and no implied duties or obligations shall be read into
this Agreement or any Operative Agreement against the Indenture Trustee.
The Indenture Trustee shall have no responsibility to prepare or file any
Securities and Exchange Commission filing for the Trust or to record this
Agreement or any Operative Agreement or to prepare or file any tax return
for the Trust. The Indenture Trustee nevertheless agrees that it will, at
its own cost and expense, promptly take all action as may be necessary to
discharge any liens on any part of the Collateral that result from actions
by, or claims against itself that are not related to the administration of
the Collateral.
(e) Every provision of this Indenture relating to the conduct or affecting
the liability of or affording protection to the Indenture Trustee shall be
subject to the provisions of this Section and to the provisions of the TIA.
(f) The Indenture Trustee shall not refuse or fail to perform any of its
duties hereunder solely as a result of nonpayment of its normal fees and
expenses; provided, that nothing in this Section 6.1(f) shall be construed to
limit the exercise by the Indenture Trustee of any right or remedy permitted
under this Indenture or otherwise in the event of the Issuer's failure to pay
the Indenture Trustee's fees and expenses pursuant to Section 6.7. In
determining that such repayment or indemnity is not reasonably assured to it,
the Indenture Trustee must consider not only the likelihood of repayment or
indemnity by or on behalf of the Issuer but also the likelihood of repayment or
indemnity from amounts payable to it from the Collateral pursuant to Section
6.7.
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SECTION 6.2 Rights of Indenture Trustee.
(a) The Indenture Trustee may rely on and shall be protected in acting in
good faith upon any document believed by it to be genuine and to have been
signed or presented by the proper person. The Indenture Trustee need not
investigate any fact or matter stated in any such document.
(b) Before the Indenture Trustee acts or refrains from acting, it may
require an Officer's Certificate or an Opinion of Counsel. The Indenture Trustee
shall not be liable for any action it takes or omits to take in good faith in
reliance on an Officer's Certificate or an Opinion of Counsel.
(c) The Indenture Trustee may execute any of the trusts or powers hereunder
or perform any duties hereunder either directly or by or through agents or
attorneys or a custodian or nominee and the Indenture Trustee shall not be
responsible for any misconduct or negligence on the part of such agent,
attorney, custodian or nominee appointed by the Indenture Trustee with due care.
(d) The Indenture Trustee shall not be liable for any action it takes or
omits to take in good faith which it believes to be authorized or within its
rights or powers; provided, however, that such action or omission by the
Indenture Trustee does not constitute willful misconduct, negligence or bad
faith.
(e) The Indenture Trustee may consult with counsel, and the advice or
opinion of counsel or any Opinion of Counsel with respect to legal matters
relating to the Operative Agreements shall be full and complete authorization
and protection from liability with respect to any action taken, omitted or
suffered by it hereunder in good faith and in accordance with the advice or
opinion of such counsel. The Issuer shall be responsible for the reasonable
costs and expenses of any such counsel.
(f) The Indenture Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, approval, bond or
other paper or document, unless requested in writing to do so by the Majority
the Noteholders; provided, however, that if the payment within a reasonable time
to the Indenture 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
Indenture Trustee, not reasonably assured to the Indenture Trustee by the
security afforded to it by the terms of this Indenture, the Indenture Trustee
may require reasonable indemnity against such cost, expense or liability as a
condition to taking any such action. The reasonable expense of every such
investigation shall be paid by the Issuer or, if paid by the Indenture Trustee,
shall be repaid by the Issuer upon demand.
(g) The right of the Indenture Trustee to perform any discretionary act
enumerated in this Agreement shall not be construed as a duty, and the Indenture
Trustee shall not be answerable for other than its negligence or willful
misconduct in the performance of such act.
(h) The Indenture Trustee shall not be required to give any bond or surety
in respect of the execution of the powers granted hereunder.
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SECTION 6.3 Individual Rights of Indenture Trustee.
The Indenture Trustee in its individual or any other capacity other than as
Indenture Trustee may, and in its capacity as Indenture Trustee may not, become
the owner or pledgee of Notes and may otherwise deal with the Issuer or its
Affiliates with the same rights it would have if it were not Indenture Trustee.
Any Paying Agent, Note Registrar, co-registrar or co-paying agent may do the
same with like rights.
SECTION 6.4 Indenture Trustee's Disclaimer.
(a) The Indenture Trustee shall not be responsible for and makes no
representation as to the validity or adequacy of this Indenture, any other
Operative Agreement or the Notes or the Issuer's use of the proceeds from the
Notes, or responsible for any statement of the Issuer in the Indenture or in any
document issued in connection with the sale of the Notes or in the Notes other
than the Indenture Trustee's certificate of authentication.
(b) Notwithstanding anything to the contrary in this Indenture or the other
Operative Agreements, the Indenture Trustee shall have no duties,
responsibilities or obligations under the Consolidated Agreement or the Existing
Trust Agreements (as defined in the Consolidated Agreement).
SECTION 6.5 Notice of Default. If a Default occurs and is continuing and if
it is known to a Responsible Officer of the Indenture Trustee, the Indenture
Trustee shall mail to each Noteholder notice of the Default within [ o ] days
after it acquires knowledge of such Default.
SECTION 6.6 Reports by Indenture Trustee to Holders. Upon request by a
Noteholder, the Master Servicer shall deliver to each Noteholder such
information as may be required to enable such holder to prepare its federal and
State income tax returns.
SECTION 6.7 Compensation and Indemnity. As compensation for its services
hereunder and under the Servicing Agreement (including in its capacity as Paying
Agent and Custodian), the Indenture Trustee shall be entitled to receive an
annual fee (which shall not be limited by any provision of law in regard to the
compensation of a Indenture Trustee of an express trust) payable by the Master
Servicer. Reimbursement for all reasonable out-of-pocket expenses incurred or
made by the Indenture Trustee, including costs of collection, shall be payable
by the Issuer. Such expenses shall include the reasonable compensation and
expenses, disbursements and advances, if any, of the Indenture Trustee's agents,
counsel, accountants and experts. The Issuer shall, or shall cause the Seller
to, and the Seller shall, indemnify the Indenture Trustee (including in its
capacities as Paying Agent, Custodian and Securities Intermediary) and [o], in
its capacity as a Custodian, against any and all loss, liability or expense
(including attorneys' fees) incurred by the Indenture Trustee (including in its
capacities as Paying Agent, Custodian and Securities Intermediary) (or [o], in
its capacity as a Custodian) in connection with the administration of this trust
and the performance of its duties under the Operative Agreements. The Indenture
Trustee (or a Custodian) shall notify the Issuer and the Seller promptly of any
claim for which it may seek indemnity. Failure by the Indenture Trustee (or a
Custodian) to so notify the Issuer and the Seller shall not relieve the Issuer
and the Seller of its obligations hereunder. The Issuer shall or shall cause the
Seller to defend any such claim, and
58
the Indenture Trustee, the Paying Agent, the Custodian and the Securities
Intermediary may have separate counsel and the Issuer shall or shall cause the
Seller to pay the fees and expenses of such counsel. The Seller need not
reimburse any expense or indemnify against any loss, liability or expense
incurred by the Indenture Trustee, the Paying Agent, the Custodian or the
Securities Intermediary to the extent attributable to such Person's own willful
misconduct, negligence or bad faith.
The payment and indemnification obligations of the Seller, the Master
Servicer and the Issuer, as applicable, to the Indenture Trustee (including in
its capacities as Paying Agent, Custodian and Securities Intermediary) (or [o],
in its capacity as a Custodian) pursuant to this Section shall survive the
resignation or removal of the Indenture Trustee (or its Custodian) or discharge
of this Indenture. When the Indenture Trustee incurs expenses in connection with
the occurrence of a Default specified in Section 5.01(v) or (vi) with respect to
the Issuer, the expenses are intended to constitute expenses of administration
under Title 11 of the United States Code or any other applicable federal or
State bankruptcy, insolvency or similar law.
SECTION 6.8 Replacement of Indenture Trustee. No resignation or removal of
the Indenture Trustee and no appointment of a successor Indenture Trustee shall
become effective until the acceptance of appointment by the successor Indenture
Trustee pursuant to this Section. The Indenture Trustee may resign at any time
by so notifying the Issuer. The Holders of a majority in Outstanding Amount of
the Notes may remove the Indenture Trustee by so notifying the Indenture Trustee
and may appoint a successor Indenture Trustee. The Issuer shall remove the
Indenture Trustee if:
(a) the Indenture Trustee fails to comply with Section 6.11;
(b) the Indenture Trustee is adjudged a bankrupt or insolvent;
(c) a receiver or other public officer takes charge of the Indenture
Trustee or its property; or
(d) the Indenture Trustee otherwise becomes incapable of acting.
If the Indenture Trustee resigns or is removed or if a vacancy exists in
the office of Indenture Trustee for any reason (the Indenture Trustee in such
event being referred to herein as the "resigning or removed Indenture Trustee"),
the Issuer shall promptly appoint a successor Indenture Trustee that satisfies
the eligibility requirements of Section 6.11.
The resigning or removed Indenture Trustee agrees to cooperate with any
successor Indenture Trustee in effecting the termination of the resigning or
removed Indenture Trustee's responsibilities and rights hereunder and shall
promptly provide such successor Indenture Trustee all documents and records
reasonably requested by it to enable it to assume the Indenture Trustee's
functions hereunder. Any successor Indenture Trustee shall have all the rights,
powers and duties of the Indenture Trustee under this Indenture.
The resigning or removed Indenture Trustee shall Grant to the successor
Indenture Trustee the Collateral, and the Seller, the Issuer and the resigning
or removed Indenture Trustee shall execute and deliver such instruments and do
such other things as may reasonably be
59
required for more fully and certainly vesting and confirming in the successor
Indenture Trustee all rights, powers, duties and obligations under this
Indenture.
The successor Indenture Trustee shall deliver a written acceptance of its
appointment to the resigning or removed Indenture Trustee and the Issuer. The
successor Indenture Trustee shall mail a notice of its succession to
Noteholders. The resigning Indenture Trustee shall promptly transfer all
property held by it as Indenture Trustee to the successor Indenture Trustee.
If a successor Indenture Trustee does not take office within [ o ] days
after the retiring Indenture Trustee resigns or is removed, the resigning or
removed Indenture Trustee, the Issuer or the Holders of a majority of the
Outstanding Amount of the Notes may petition any court of competent jurisdiction
for the appointment of a successor Indenture Trustee. If the Indenture Trustee
fails to comply with Section 6.11, any Noteholder may petition any court of
competent jurisdiction for the removal of the Indenture Trustee and the
appointment of a successor Indenture Trustee.
Notwithstanding the replacement of the Indenture Trustee pursuant to this
Section, the Issuer's obligations under Section 6.07 shall continue for the
benefit of the retiring Indenture Trustee.
SECTION 6.9 Successor Indenture Trustee by Merger. If the Indenture Trustee
consolidates with, merges or converts into, or transfers all or substantially
all its corporate trust business or assets to, another corporation or banking
association, the resulting, surviving or transferee corporation without any
further act shall be the successor Indenture Trustee; provided, that such
corporation or banking association shall be otherwise qualified and eligible
under Section 6.11.
In case at the time such successor or successors by merger, conversion or
consolidation to the Indenture Trustee shall succeed to the trusts created by
this Indenture any of the Notes shall have been authenticated but not delivered,
any such successor to the Indenture Trustee may adopt the certificate of
authentication of any predecessor Indenture Trustee, and deliver such Notes so
authenticated; and in case at that time any of the Notes shall not have been
authenticated, any successor to the Indenture Trustee may authenticate such
Notes either in the name of any predecessor hereunder or in the name of the
successor to the Indenture Trustee; and in all such cases such certificates
shall have the full force which it is anywhere in the Notes or in this Indenture
provided that the certificate of the Indenture Trustee shall have.
SECTION 6.10 Appointment of Co-Indenture Trustee or Separate Indenture
Trustee.
(a) Notwithstanding any other provisions of this Indenture, at any time,
for the purpose of meeting any legal requirement of any jurisdiction in which
any part of the Collateral may at the time be located, the Indenture Trustee
shall have the power and may execute and deliver all instruments to appoint one
or more Persons to act as a co-Indenture Trustee or co-Indenture Trustees, or
separate Indenture Trustee or separate Indenture Trustees, of all or any part of
the Trust Estate, and to vest in such Person or Persons, in such capacity and
for the benefit of the Noteholders, such title to the Collateral, or any part
thereof, and, subject to the
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other provisions of this Section, such powers, duties, obligations, rights and
trusts as the Indenture Trustee may consider necessary or desirable. No
co-Indenture Trustee or separate Indenture Trustee hereunder shall be required
to meet the terms of eligibility as a successor Indenture Trustee under Section
6.11 and no notice to Noteholders of the appointment of any co-Indenture Trustee
or separate Indenture Trustee shall be required under this Section 6.10 hereof;
(b) Every separate Indenture Trustee and co-Indenture Trustee shall, to the
extent permitted by law, be appointed and act subject to the following
provisions and conditions:
(i) all rights, powers, duties and obligations conferred or imposed
upon the Indenture Trustee shall be conferred or imposed upon and exercised
or performed by the Indenture Trustee and such separate Indenture Trustee
or co-Indenture Trustee jointly (it being understood that such separate
Indenture Trustee or co-Indenture Trustee is not authorized to act
separately without the Indenture Trustee joining in such act), except to
the extent that under any law of any jurisdiction in which any particular
act or acts are to be performed the Indenture Trustee shall be incompetent
or unqualified to perform such act or acts, in which event such rights,
powers, duties and obligations (including the holding of title to the
Collateral or any portion thereof in any such jurisdiction) shall be
exercised and performed singly by such separate Indenture Trustee or
co-Indenture Trustee, but solely at the direction of the Indenture Trustee;
(ii) no Indenture Trustee hereunder shall be personally liable by
reason of any act or omission of any other Indenture Trustee hereunder; and
(iii) the Indenture Trustee may at any time accept the resignation of
or remove any separate Indenture Trustee or co-Indenture Trustee.
(c) Any notice, request or other writing given to the Indenture Trustee
shall be deemed to have been given to each of the then separate Indenture
Trustees and co-Indenture Trustees, as effectively as if given to each of them.
Every instrument appointing any separate Indenture Trustee or co-Indenture
Trustee shall refer to this Indenture and the conditions of this Article VI.
Each separate Indenture Trustee and co-Indenture Trustee, upon its acceptance of
the trusts conferred, shall be vested with the estates or property specified in
its instrument of appointment, jointly with the Indenture Trustee, subject to
all the provisions of this Indenture, specifically including every provision of
this Indenture relating to the conduct of, affecting the liability of, or
affording protection to, the Indenture Trustee. Every such instrument shall be
filed with the Indenture Trustee.
(d) Any separate Indenture Trustee or co-Indenture Trustee may at any time
constitute the Indenture 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 Indenture on its behalf and in its name. If any separate
Indenture Trustee or co-Indenture 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 Indenture Trustee, to the extent
permitted by law, without the appointment of a new or successor Indenture
Trustee.
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SECTION 6.11 Eligibility. The Indenture Trustee shall at all times (i)
satisfy the requirements of TIA Section 310(a), (ii) have a combined capital and
surplus of at least $[50,000,000] as set forth in its most recently published
annual report of condition, (iii) have a long-term debt rating equivalent to "A"
or better by the Rating Agencies or be otherwise acceptable to the Rating
Agencies [;] [and] (iv) not be an Affiliate of the Issuer or the Owner Trustee.
The Indenture Trustee shall comply with TIA Section 310(b), including the
optional provision permitted by the second sentence of TIA Section 310(b)(9);
provided, however, that there shall be excluded from the operation of TIA
Section 310(b)(1) any indenture or indentures under which other securities of
the Issuer are outstanding if the requirements for such exclusion set forth in
TIA Section 310(b)(1) are met.
SECTION 6.12 Representations and Warranties. The Indenture Trustee hereby
represents that:
(a) the Indenture Trustee is duly organized and validly existing as a [o]
in good standing under the laws of the State of [o] with power and authority to
own its properties and to conduct its business as such properties are currently
owned and such business is presently conducted;
(b) the Indenture Trustee has the power and authority to execute and
deliver this Indenture and to carry out its terms; and the execution, delivery
and performance of this Indenture have been duly authorized by the Indenture
Trustee by all necessary corporate action;
(c) the consummation of the transactions contemplated by this Indenture and
the fulfillment of the terms hereof do not conflict with, result in any breach
of any of the terms and provisions of, or constitute (with or without notice or
lapse of time) a default under the articles of organization or bylaws of the
Indenture Trustee or any agreement or other instrument to which the Indenture
Trustee is a party or by which it is bound; and
(d) there are no proceedings or investigations pending or, to the knowledge
of the Indenture Trustee, threatened before any court, regulatory body,
administrative agency or other governmental instrumentality having jurisdiction
over the Indenture Trustee or its properties: (i) asserting the invalidity of
this Indenture, (ii) seeking to prevent the consummation of any of the
transactions contemplated by this Indenture or (iii) seeking any determination
or ruling that might materially and adversely affect the performance by the
Indenture Trustee of its obligations under, or the validity or enforceability
of, this Indenture.
SECTION 6.13 Preferential Collection of Claims Against Issuer. The
Indenture Trustee shall comply with TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). An Indenture Trustee which has
resigned or been removed shall be subject to TIA Section 311(a) to the extent
indicated.
ARTICLE VII
NOTEHOLDERS' LISTS AND REPORTS
SECTION 7.1 Issuer To Furnish Indenture Trustee Names and Addresses of
Noteholders. The Issuer will furnish or cause to be furnished to
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the Indenture Trustee not more than [ o ] days after each Record Date, a list,
in such form as the Indenture Trustee may reasonably require, of the names and
addresses of the Holders of Notes as of such Record Date; provided, however,
that so long as the Indenture Trustee is the Note Registrar, no such list shall
be required to be furnished.
SECTION 7.2 Preservation of Information; Communications to Noteholders.
(a) The Indenture Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of the Holders of Notes
contained in the most recent list furnished to the Indenture Trustee as provided
in Section 7.01 and the names and addresses of Holders of Notes received by the
Indenture Trustee in its capacity as Note Registrar. The Indenture Trustee may
destroy any list furnished to it as provided in such Section 7.01 upon receipt
of a new list so furnished.
(b) Noteholders may communicate pursuant to TIA Section 312(b) with other
Noteholders with respect to their rights under this Indenture or under the
Notes.
(c) The Issuer, the Note Registrar and the Indenture Trustee shall have the
protection of TIA Section 3l2(c).
SECTION 7.3 Reports by Issuer.
(a) The Issuer shall:
(i) file with the Indenture Trustee and the Commission in accordance
with the rules and regulations prescribed from time to time by the
Commission such information, documents and reports with respect to
compliance by the Issuer with the conditions and covenants of this
Indenture as may be required from time to time by such rules and
regulations; and
(ii) supply to the Indenture Trustee (and the Indenture Trustee shall
transmit by mail to all Noteholders described in TIA Section 313(c)) such
summaries of any information, documents and reports required to be filed by
the Issuer pursuant to clause (i) of this Section 7.03(a) and by rules and
regulations prescribed from time to time by the Commission.
(b) Unless the Issuer otherwise determines, the fiscal year of the Issuer
shall end on December 31 of each year.
SECTION 7.4 Reports by Indenture Trustee. If required by TIA Section
313(a), within 60 days after each March 1, beginning with March 1, 200_, the
Indenture Trustee shall mail to each Noteholder as required by TIA Section
313(c) a brief report dated as of such date that complies with TIA Section
313(a). The Indenture Trustee also shall comply with TIA Section 313(b).
A copy of each report at the time of its mailing to Noteholders shall be
filed by the Indenture Trustee with the Commission and each securities exchange,
if any, on which the Notes
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are listed. The Issuer shall notify the Indenture Trustee if and when the Notes
are listed on any securities exchange.
ARTICLE VIII
ACCOUNTS, DISBURSEMENTS AND RELEASES
SECTION 8.1 Collection of Money.
(a) Except as otherwise expressly provided herein, the Indenture Trustee
may demand payment or delivery of, and shall receive and collect, directly and
without intervention or assistance of any fiscal agent or other intermediary,
all money and other property payable to or receivable by the Indenture Trustee
pursuant to this Indenture. The Indenture Trustee shall apply all such money
received by it as provided in this Indenture. Except as otherwise expressly
provided in this Indenture, if any default occurs in the making of any payment
or performance under any agreement or instrument that is part of the Collateral,
the Indenture Trustee may take such action as may be appropriate to enforce such
payment or performance, including the institution and prosecution of appropriate
Proceedings. Any such action shall be without prejudice to any right to claim a
Default or Event of Default under this Indenture and any right to proceed
thereafter as provided in Article V.
SECTION 8.2 Payments on the Notes.
(a) On each Distribution Date, the Paying Agent (or, if the Indenture
Trustee acts as Paying Agent, the Indenture Trustee) shall distribute the
Available Distribution Amount as follows.
first, to the Noteholders the Interest Distribution Amount for such
Distribution Date;
second, to the Noteholders, the amount of Principal Distribution for
such Distribution Date in reduction of the Note Principal Balance
until the Note Principal Balance reducted to zero;
third, to the Noteholders in reduction of the Note Principal Balance,
the amount, if any, equal to the lessor of (A) the Excess Cash with
respect to such Distribution Date (after giving effect to application
of Monthly Principal for such Distribution Date) and (2) the amount
necessary to reduce the Note Principal Balance to zero (the "Excess
Cash Payment");
Any Available Distribution Amount remaining after application in the manner
specified above will be released to holders of the Trust Certificates, free and
clear of the lien of this Indenture.
SECTION 8.3 Release of Collateral.
(a) Subject to the payment of its fees and expenses pursuant to Section
6.07, the Indenture Trustee may, and when required by the provisions of this
Indenture or the Servicing
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Agreement shall, execute instruments to release property from the lien of this
Indenture, or convey the Indenture Trustee's interest in the same, in a manner
and under circumstances that are not inconsistent with the provisions of this
Indenture or the Servicing Agreement. No party relying upon an instrument
executed by the Indenture Trustee as provided in this Article VIII shall be
bound to ascertain the Indenture Trustee's authority, inquire into the
satisfaction of any conditions precedent or see to the application of any
monies.
(b) The Indenture Trustee shall, at such time as there are no Notes
outstanding and all sums due to the Noteholders and all fees and expenses of the
Indenture Trustee, the Master Servicer and the Custodians pursuant to this
Indenture have been paid, release any remaining portion of the Collateral that
secured the Notes from the lien of this Indenture and release to the Issuer or
any other Person entitled thereto any funds then on deposit in the Trust
Accounts. The Indenture Trustee shall release property from the lien of this
Indenture pursuant to this subsection (b) only upon receipt of an Issuer Request
accompanied by an Officer's Certificate, an Opinion of Counsel and (if required
by the TIA) Independent Certificates in accordance with TIA Sections 314(c) and
314(d)(1) meeting the applicable requirements of Section 13.1 hereof.
ARTICLE IX
ADMINISTRATION OF TRUST FUND
SECTION 9.1 Collection Accounts; Distribution Account.
(a) On or prior to the Closing Date, the Master Servicer shall have caused
the Servicers to establish and maintain one or more Collection Accounts, which
shall be Eligible Accounts into which all Scheduled Payments and unscheduled
payments with respect to the Mortgage Loans, net of any deductions or
reimbursements permitted under the related Servicing Agreement, shall be
deposited. On each Remittance Date, the Servicers shall remit to the Indenture
Trustee for deposit into the Distribution Account, all amounts so required to be
deposited into such account in accordance with the terms of the related
Servicing Agreement.
(b) The Indenture Trustee shall establish and maintain an Eligible Account
entitled "Distribution Account of __________, as Indenture Trustee for the
benefit of the Holders of the Luminent Mortgage Trust 200_ - ____,
Mortgage-Backed Notes, Series 200_ - ____." The Indenture Trustee shall,
promptly upon receipt from the Servicers on each Remittance Date, deposit into
the Distribution Account and retain on deposit until the related Distribution
Date the following amounts:
(i) the aggregate of collections with respect to the Mortgage Loans
remitted by the Servicers from the related Collection Accounts and the
amount of any Monthly Advances, Servicing Advances or Compensating Interest
Payments with respect to the Mortgage Loans;
(ii) any amounts required to be deposited by the Master Servicer with
respect to the Mortgage Loans for the related Due Period pursuant to this
Agreement, including the amount of any Monthly Advances, Servicing Advances
or Compensating Interest Payments with respect to the Mortgage Loans not
paid by the Servicers; and
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(iii) any other amounts so required to be deposited in the
Distribution Account in the related Due Period pursuant to this Agreement.
(c) In the event the Master Servicer or a Servicer has remitted in error to
the Distribution Account any amount not required to be remitted in accordance
with the definition of Available Distribution Amount, it may at any time direct
the Indenture Trustee to withdraw such amount from the Distribution Account for
repayment to the Master Servicer or the related Servicer, as applicable, by
delivery of an Officer's Certificate to Indenture Trustee which describes the
amount deposited in error.
(d) On each Distribution Date, the Indenture Trustee shall distribute the
Available Distribution Amount to the Noteholders and any other parties entitled
thereto. The Indenture Trustee may from time to time withdraw from the
Distribution Account and pay the Master Servicer, the Indenture Trustee, the
Securities Administrator or any Servicer any amounts permitted to be paid or
reimbursed to such Person from funds in the Distribution Account pursuant to the
clauses (A) through (D) of the definition of Available Distribution Amount.
(e) Funds in the Distribution Account may be invested in Permitted
Investments selected by and at the written direction of the Master Servicer,
which shall mature not later than one Business Day prior to the Distribution
Date (except that if such Permitted Investment is an obligation of the Master
Servicer, then such Permitted Investment shall mature not later than such
applicable Distribution Date) and any such Permitted Investment shall not be
sold or disposed of prior to its maturity. All such Permitted Investments shall
be made in the name of the Indenture Trustee (in its capacity as such) or its
nominee. All income and gain realized from any Permitted Investment shall be for
the benefit of the Master Servicer and shall be subject to its withdrawal or
order from time to time, and shall not be part of the Trust Fund. The amount of
any losses incurred in respect of any such investments shall be deposited in
such Distribution Account by the Master Servicer out of its own funds, without
any right of reimbursement therefor, immediately as realized.
SECTION 9.2 Permitted Withdrawals from the Distribution Account. The
Indenture Trustee shall withdraw funds from the Distribution Account for
distributions to Noteholders in the manner specified in this Agreement (and to
withhold from the amounts so withdrawn, the amount of any taxes that it is
authorized to withhold hereunder. In addition, the Indenture Trustee may from
time to time make withdrawals from the Distribution Account for the following
purposes:
(i) to pay to itself the Indenture Trustee Fee for the related
Distribution Date;
(ii) to pay the Master Servicer the Master Servicing Fee for the
related Distribution Date;
(iii) to withdraw and return to the related Servicer any amount
deposited in the Distribution Account and not required to be deposited
therein; and
(iv) to clear and terminate the Distribution Account upon termination
of this Indenture.
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SECTION 9.3 Advances by Master Servicer. If any Servicer fails to remit any
Advance required to be made under the applicable Servicing Agreement, the Master
Servicer shall itself make, or shall cause the successor Servicer to make, such
Advance. If the Master Servicer determines that an Advance is required, it shall
on the Business Day preceding the Distribution Date immediately following such
Determination Date, remit to the Securities Administrator from its own funds (or
funds advanced by the applicable Servicer) for deposit in the Distribution
Account immediately available funds in an amount equal to such Advance. The
Master Servicer and each Servicer shall be entitled to be reimbursed for all
Advances made by it. Notwithstanding anything to the contrary herein, in the
event the Master Servicer determines in its reasonable judgment that an Advance
is a Non-recoverable Advance, the Master Servicer shall be under no obligation
to make such Advance. If the Master Servicer determines that an Advance is a
Non-recoverable Advance, it shall, on or prior to the related Distribution Date,
deliver an Officer's Certificate to the Indenture Trustee to such effect;
provided, that, with respect to any Mortgage Loan for which the related Servicer
provided an Officer Certificate that any Advance would constitute a
Non-recoverable Advance, such Officer's Certificate shall fulfill the Master
Servicer's obligations under this Section 9.3.
SECTION 9.4 Compensating Interest Payments. The amount of the aggregate
Master Servicing Fees payable to the Master Servicer in respect of any
Distribution Date shall be reduced (but not below zero) by the amount of any
Compensating Interest Payment for such Distribution Date, but only to the extent
that Prepayment Interest Shortfalls relating to such Distribution Date are
required to be paid but not actually paid by the Servicers. Such amount shall
not be treated as an Advance and shall not be reimbursable to the Master
Servicer.
SECTION 9.5 Pre-Funding Account.
(a) The Indenture Trustee shall establish and maintain an Eligible Account,
to be held in trust for the benefit of Noteholders, entitled "Pre-Funding
Account of [o], as Indenture Trustee, for the benefit of Holders of the Luminent
Mortgage Trust 200_-_ Mortgage-Backed Notes." On the Closing Date, the Depositor
will cause to be deposited to the Pre-Funding Account the Pre-Funded Amount.
(b) Amounts on deposit in the Pre-Funding Account (exclusive of investment
earnings thereon) shall solely be applied to acquire Subsequent Mortgage Loans.
(c) On any Subsequent Sale Date, the Depositor shall instruct the Indenture
Trustee, in writing, to withdraw funds (exclusive of investment earnings) from
the Pre-Funding Account (specifying the applicable sub-account, if applicable)
in an amount equal to the price for the Subsequent Mortgage Loans to be acquired
on such Subsequent Sale Date, and to pay such amount to the order of the
Depositor. In no event shall the Indenture Trustee withdraw from the Pre-Funding
Account an amount in excess of the Pre-Funded Amount (or portion thereof)
deposited to such Account on the Closing Date.
(d) During the Pre-Funding Period, amounts on deposit in the Pre-Funding
Account may be invested in Permitted Investments by the Indenture Trustee at the
direction of the Depositor, or in absence of direction from the Depositor, in
money market funds described in paragraph (viii) of the definition of Permitted
Investments in Article I. All such Permitted
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Investments shall be made in the name of the Indenture Trustee (in it capacity
as such) or its nominee. Any investment earnings on such Permitted Investments
held in the Pre-Funding Account shall be immediately transferred to the
Distribution Account and constitute part of the Available Distribution Amount
for distribution to the related Noteholders on the next succeeding Distribution
Date.
(e) On the last day of the Pre-Funding Period, the Indenture Trustee shall
transfer any remaining Pre-Funded Amount on deposit in the Pre-Funding Account
(or sub-account thereof, if applicable) to the Distribution Account, which will
be held uninvested, and will be included in the Available Distribution Amount
for distribution to the Notes as an additional prepayment of principal on the
immediately following Distribution Date and terminate such Account.
(f) The Indenture Trustee, on behalf of the Trust, shall be the legal owner
of the Pre-Funding Account. All amounts earned on deposits in the Pre-Funding
Account shall be taxable to ___________. The Indenture Trustee shall release to
___________ all investment earnings in the Pre-Funding Account on the Business
Day immediately following the end of the Pre-Funding Period.
(g) On the Subsequent Sales Date, each Subsequent Mortgage Loan must meet
the following conditions: (i) the remaining term to maturity of each Subsequent
Mortgage Loan may not exceed 30 years; (ii) the addition of the Subsequent
Mortgage Loans will not result in the reduction, qualification or withdrawal of
the then current ratings of the Notes; (iii) no Subsequent Mortgage Loan may
have a Loan-to-Value Ratio greater than 100%; (iv) each Subsequent Mortgage Loan
will be underwritten in accordance with the underwriting guidelines used for the
original Mortgage Loans; (v) the acquisition of the Subsequent Mortgage Loans
will not lower the weighed average annual percentage rate of all of the Mortgage
Loans held by the Trust Fund by 100 basis points or more.
SECTION 9.6 Financial Assets Custodial Account.
(a) The Indenture Trustee, shall establish and maintain an Eligible
Account, to be held in trust for the benefit of Noteholders, entitled "Financial
Assets Custodial Account of [o], as Indenture Trustee, for the benefit of the
Holders of the Luminent Mortgage Trust 200_-_ Mortgage-Backed Notes." On the
Closing Date, the Depositor shall cause to be deposited in the Financial Assets
Custodial Account the those Financial Assets identified on Schedule II.
(b) The Financial Asset Custodial Account is a "securities account" (within
the meaning of Section 8-501(a) of the UCC) in respect of which the Indenture
Trustee is a "securities intermediary" (within the meaning of Section
8-102(a)(14) of the UCC) and the Indenture Trustee is the "entitlement holder"
(within the meaning of Section 8-102(a)(7) of the UCC).
(c) The Indenture Trustee hereby agrees that each item of property (whether
cash, a security, an instrument or any other property whatsoever) credited to
any of the Accounts shall be treated as a "financial asset" under Article 8 of
the UCC. All securities and other financial assets credited to the Financial
Asset Custodial Account that are in registered form or that are payable to or to
order shall be (i) registered in the name of, or payable to or to the order of,
the
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Indenture Trustee, (ii) endorsed to or to the order of the Indenture Trustee or
in blank or (iii) credited to another securities account maintained in the name
of the Indenture Trustee.
(d) The Indenture Trustee agrees that its "securities intermediary's
jurisdiction" (within the meaning of Section 8-110(e) of the UCC) with respect
to the Accounts is the State of [o].
(e) Any distributions received in respect of the Financial Assets during
the related Due Period shall be remitted to the Distribution Account on or prior
to the related Distribution Date for Distribution.
SECTION 9.7 Calculation of LIBOR.
(a) For each LIBOR Determination Date, the Indenture Trustee will determine
the arithmetic mean of the London Interbank Offered Rate quotations for
one-month Eurodollar deposits ("LIBOR") for the succeeding Accrual Period on the
basis of the Reference Banks' offered LIBOR quotations provided to the Indenture
Trustee as of 11:00 a.m. (London time) for such LIBOR Determination Date. As
used herein with respect to a LIBOR Determination Date, "REFERENCE BANKS" means
leading banks engaged in transactions in Eurodollar deposits in the
international Eurocurrency market (i) with an established place of business in
London, (ii) whose quotations appear on the Designated Telerate Page for the
LIBOR Determination Date in question and (iii) which have been designated as
such by the Servicer and are able and willing to provide such quotations to the
Servicer for each LIBOR Determination Date. "DESIGNATED TELERATE PAGE" means the
[BBA Page][the Bloomberg Screen US0001 Index Page]. ["BBA PAGE" means the
interest settlement rates set by the British Bankers' Association as currently
displayed on the Dow Xxxxx Telerate Service page 3750.] ["BLOOMBERG SCREEN
US0001M INDEX PAGE" means the display designated as page US0001M on the
Bloomberg Financial Markets Commodities News (or such other pages as may replace
such page on that service for the purpose of displaying LIBOR quotations of
major banks)]. If any Reference Bank should be removed from the Telerate Page or
in any other way fails to meet the qualifications of a Reference Bank, the
Indenture Trustee may, in its sole discretion, designate an alternative
Reference Bank.
(b) For each LIBOR Determination Date, LIBOR for the next succeeding
Accrual Period will be established by the Indenture Trustee as follows:
(i) If, for any LIBOR Determination Date, two or more of the Reference
Banks provide offered LIBOR quotations on the Telerate Page, LIBOR for the
next Accrual Period will be the arithmetic mean of such offered quotations
(rounding such arithmetic mean if necessary to the nearest five decimal
places).
(ii) If, for any LIBOR Determination Date, only one or none of the
Reference Banks provides such offered LIBOR quotations for the next
applicable Accrual Period, LIBOR for the next Accrual Period will be the
higher of (x) LIBOR as determined for the previous LIBOR Determination Date
and (y) the Reserve Interest Rate. The "RESERVE INTEREST RATE" will be the
rate per annum that the Indenture Trustee determines to be either (A) the
arithmetic mean (rounding such arithmetic mean if necessary to the nearest
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five decimal places) of the one-month Eurodollar lending rate that New York
City banks selected by the Indenture Trustee are quoting, on the relevant
LIBOR Determination Date, to the principal London offices of at least two
leading banks in the London Interbank market or (B) in the event that the
Indenture Trustee can determine no such arithmetic mean, the lowest
one-month Eurodollar lending rate that the New York City banks selected by
the Indenture Trustee are quoting on such LIBOR Determination Date to
leading European banks.
(iii) If, for any LIBOR Determination Date, the Indenture Trustee is
required but is unable to determine the Reserve Interest Rate in the manner
provided in paragraph (ii) above, LIBOR for the next applicable Accrual
Period will be LIBOR as determined for the previous LIBOR Determination
Date.
(c) Notwithstanding the foregoing, LIBOR for an Accrual Period shall not be
based on LIBOR for the previous Accrual Period for two consecutive LIBOR
Determination Dates. If, under the priorities described above, LIBOR for an
Accrual Period would be based on LIBOR for the previous LIBOR Determination Date
for the second consecutive LIBOR Determination Date, the Indenture Trustee shall
select an alternative index (over which the Indenture Trustee has no control)
used for determining one-month Eurodollar lending rates that is calculated and
published (or otherwise made available) by an independent third party.
(d) The establishment of LIBOR (or an alternative index) by the Indenture
Trustee for the relevant Accrual Period, in the absence of manifest error, will
be final and binding.
SECTION 9.8 Monthly Statements to Noteholders.
(a) Not later than each Distribution Date, the Indenture Trustee shall
prepare and make available to each Noteholder, the Master Servicer, the
Depositor and each Rating Agency a statement setting forth with respect to the
related distribution:
(i) the amount thereof allocable to principal, separately identifying
the aggregate amount of any Principal Prepayments and Liquidation Proceeds
included therein;
(ii) the amount thereof allocable to interest, any accrued and unpaid
Interest Distribution Shortfall Amounts included in such distribution and
any remaining unpaid Interest Distribution Shortfall Amount after giving
effect to such distribution;
(iii) if the distribution to the Holders of such Notes is less than
the full amount that would be distributable to such Holders if there were
sufficient funds available therefor, the amount of the shortfall and the
allocation thereof as between principal and interest;
(iv) the Note Principal Amount after giving effect to the distribution
of principal on such Distribution Date;
(v) the Pool Scheduled Principal Balance for the following
Distribution Date;
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(vi) the amount of the Servicing Fees paid to or retained by each
Servicer with respect to such Distribution Date, and the amount of Master
Servicing Fees paid to or retained by the Master Servicer with respect to
such Distribution Date;
(vii) the amount of Monthly Advances included in the distribution on
such Distribution Date and the aggregate amount of Monthly Advances
outstanding as of the close of business on such Distribution Date;
(viii) the number and aggregate principal amounts of Mortgage Loans
(A) delinquent (exclusive of Mortgage Loans in foreclosure) (1) one to 30
days (2) 31 to 60 days (3) 61 to 90 days and (4) 91 or more days and (B) in
foreclosure and delinquent (1) one to 30 days (2) 31 to 60 days (3) 61 to
90 days and (4) 91 or more days, as of the close of business on the last
day of the calendar month preceding such Distribution Date;
(ix) with respect to any Mortgage Loan that became an REO Property
during the preceding calendar month, the loan number and Scheduled
Principal Balance of such Mortgage Loan as of the close of business on the
Determination Date preceding such Distribution Date and the date of
acquisition thereof;
(x) the total number and principal balance of any REO Properties (and
market value, if available) as of the close of business on the
Determination Date preceding such Distribution Date;
(xi) the aggregate amount of Realized Losses incurred during the
preceding calendar month;
(xii) the Special Hazard Loss Coverage Amount, the Fraud Loss Coverage
Amount and the Bankruptcy Loss Coverage Amount, in each case as of the
related Determination Date; and
(xiii) the Pre-Funded Amount, if any, in the Pre-Funding Account on
the related Distribution Date, the amount of funds, if any, used to
purchase Subsequent Mortgage Loans during the Pre-Funding Period and the
amount of funds, if any, allocated as a prepayment of principal at the end
of the Pre-Funding Period.
The Indenture Trustee may make the above information available to
Noteholders via the Indenture Trustee's website at [o].
(b) The Indenture Trustee's responsibility for disseminating the above
information to the Noteholders is limited to the availability, timeliness and
accuracy of the information provided by the Servicers and/or the Master
Servicer.
(c) Within a reasonable period of time after the end of each calendar year,
the Indenture Trustee shall cause to be furnished to each Person who at any time
during the calendar year was a Noteholder, a statement containing the
information set forth in clauses (a)(i), (a)(ii) and (a)(vii) of this Section
9.8 aggregated for such calendar year or applicable portion thereof during which
such Person was a Noteholder. Such obligation of the Indenture Trustee shall be
deemed to have been satisfied to the extent that substantially comparable
information shall be
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provided by the Indenture Trustee pursuant to any requirements of the Code as
from time to time in effect.
SECTION 9.9 Reports to the Securities and Exchange Commission.
(a) Within 15 days after each Distribution Date, the Master Servicer shall,
in accordance with industry standards, file with the Commission via the
Electronic Data Gathering and Retrieval System ("XXXXX"), a Form 8-K with a copy
of the statement to be furnished by the Securities Administrator to the
Noteholders for such Distribution Date as an exhibit thereto. Prior to [o], the
Master Servicer shall, in accordance with industry standards, file a Form 15
Suspension Notice with respect to the Trust Fund, if applicable. Prior to [o]
and annually thereafter (if required), the Master Servicer shall file a Form
10-K, in substance conforming to industry standards, with respect to the Trust
Fund. Such Form 10-K shall include, to the extent available, as exhibits (i)
each applicable Servicer's annual statement of compliance described under the
related Servicing Agreement, (ii) each applicable Servicer's accountants report
described under the related Servicing Agreement, (iii) the Master Servicer's
accountant's report described in Section 12.15, if applicable, in each case to
the extent timely delivered, if applicable, to the Master Servicer, and (iv) a
written certification signed by an officer of the Master Servicer that complies
with the Xxxxxxxx-Xxxxx Act of 2002 as in effect on the date of this Agreement
and the August 27, 2002, Statement by the Staff of the Division of Corporation
Finance of the Commission Regarding Compliance by Asset-Backed Issuers with
Exchange Act Rules 13a-14 and 15d-14 as in effect as of the date of this
Agreement. If items (i) and (ii) in the preceding sentence are not timely
delivered, the Master Servicer shall file an amended Form 10-K including such
documents as exhibits reasonably promptly after they are delivered to the Master
Servicer. The Indenture Trustee hereby grants to the Master Servicer a limited
power of attorney to execute and file each Form 8-K and Form 10-K on behalf of
the Trust Fund. Such power of attorney shall continue until either the earlier
of (i) receipt by the Master Servicer from the Depositor of written termination
of such power of attorney and (ii) the termination of the Trust Fund. The
Depositor and the Indenture Trustee each agree to promptly furnish to the Master
Servicer, from time to time upon request, such further information, reports and
financial statements within its control related to this Agreement and the
Mortgage Loans as the Master Servicer reasonably deems appropriate to prepare
and file all necessary reports with the Commission. The Master Servicer will
cooperate with the Depositor in connection with any additional filings with
respect to the Trust Fund as the Depositor deems necessary under the Securities
Exchange Act of 1934, as amended (the "EXCHANGE ACT"). Copies of all reports
filed by the Master Servicer under the Exchange Act shall be sent to the
Depositor.
(b) The Master Servicer shall indemnify and hold harmless the Depositor,
the Indenture Trustee and their respective 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 Master Servicer's
obligations under this Section 9.9 or the Master Servicer's negligence, bad
faith or willful misconduct in connection therewith. Fees and expenses incurred
by the Master Servicer in connection with this Section 9.9 shall not be
reimbursable from the Trust Fund.
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SECTION 9.10 Discovery of Breach; Repurchase and Substitution of Mortgage
Loans.
(a) Pursuant to Section 3.01(h) of the Sale Agreement, the Seller has made
certain representations and warranties as to the characteristics of the Mortgage
Loans as of the Closing Date and the conveyance thereof to Owner Trustee, for
the benefit of the Owner Trustee, Indenture Trustee and the Noteholders and the
Seller has agreed under the terms of the Sale Agreement to comply with the
provisions of this Section SECTION 9.10(a) in respect of a breach of any of such
representations and warranties.
It is understood and agreed that such representations and warranties set
forth in Section 3.01(h) of the Sale Agreement shall survive delivery of the
Mortgage Files and the Assignment of Mortgage of each Mortgage Loan to the Owner
Trustee and shall continue throughout the term of this Agreement. Upon discovery
by the Depositor or receipt of written notice of any materially defective
document in, or, following the date of delivery to the Indenture Trustee of a
Final Certification, that a document is missing from, a Mortgage File, or
discovery by the Depositor or the Seller of the breach by the Seller of any
representation or warranty under the Sale Agreement in respect of any Mortgage
Loan which materially adversely affects the value of that Mortgage Loan or the
interest therein of the Noteholders (a "DEFECTIVE MORTGAGE LOAN") (each of such
parties hereby agreeing to give written notice thereof to the Indenture Trustee
and the other of such parties), the Indenture Trustee, or its designee, shall
promptly notify the Depositor in writing of such defective or missing document
or breach and request that the Depositor deliver such missing document or cure
or cause the cure of such defect or breach within 90 days from the date that the
Depositor discovered or was notified of such missing document, defect or breach,
and if the Depositor does not deliver such missing document or cure such defect
or breach in all material respects during such period, the Indenture Trustee
shall enforce the Seller's obligation under the Sale Agreement and cause the
Seller to repurchase that Mortgage Loan from the Trust Fund at the Purchase
Price on or prior to the Determination Date following the expiration of such
90-day period; provided, however, that, in connection with any such breach that
could not reasonably have been cured within such 90-day period, if the Seller
shall have commenced to cure such breach within such 90-day period, the Seller
shall be permitted to proceed thereafter diligently and expeditiously to cure
the same within an additional 90-day period. The Purchase Price for the
repurchased Mortgage Loan shall be deposited in the Distribution Account, and
the Indenture Trustee, or its designee, upon receipt of written certification
from the Securities Administrator of such deposit, shall release to the Seller
the related Mortgage File and shall execute and deliver such instruments of
transfer or assignment, in each case without recourse, representation or
warranties, as either party shall furnish to it and as shall be necessary to
vest in such party any Mortgage Loan released pursuant hereto and the Indenture
Trustee, or its designee, shall have no further responsibility with regard to
such Mortgage File (it being understood that the Trustee shall have no
responsibility for determining the sufficiency of such assignment for its
intended purpose).
In lieu of [repurchasing any such Mortgage Loan as provided above, either
party may cause such Mortgage Loan to be removed from the Trust Fund (in which
case it shall become a "DELETED MORTGAGE LOAN") and substitute one or more
Substitute Mortgage Loans in the manner and subject to the limitations set forth
in Section 9.10(b) below. If the Seller is not a member of MERS at the time when
it repurchases a Mortgage Loan and the Mortgage is
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registered on the MERS(R) System, the Seller, at its own expense and without any
right of reimbursement, shall cause MERS to execute and deliver an assignment of
the Mortgage in recordable form to transfer the Mortgage from MERS to the Seller
and shall cause such Mortgage to be removed from registration on the MERS(R)
System in accordance with MERS's rules and regulations. 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 constituent document exists or as to which such a breach has
occurred and is continuing shall constitute the sole remedy against the such
party respecting such omission, defect or breach available to the Indenture
Trustee on behalf of the Noteholders.
(b) Any substitution of Substitute Mortgage Loans for Deleted Mortgage
Loans made pursuant to Section 9.10(a) above must be effected prior to the last
Business Day that is within two years after the Closing Date. As to any Deleted
Mortgage Loan for which the Seller substitutes a Substitute Mortgage Loan or
Loans, such substitution shall be effected by delivering to the Indenture
Trustee, for such Substitute Mortgage Loan or Loans, the Mortgage Note, the
Mortgage, the Assignment to the Owner Trustee, and such other documents and
agreements, with all necessary endorsements thereon, together with an Officers'
Certificate stating that each such Substitute Mortgage Loan satisfies the
definition thereof and specifying the Substitution Adjustment Amount (as
described below), if any, in connection with such substitution. The Indenture
Trustee shall acknowledge receipt for such Substitute Mortgage Loan and, within
45 days thereafter, shall review such Mortgage Files and deliver to the
Indenture Trustee and the Depositor, with respect to such Substitute Mortgage
Loans, a certification substantially in the form of a revised Initial
Certification, with any exceptions noted thereon. Within one year of the date of
substitution, the Custodian shall deliver to the Indenture Trustee and the
Depositor a certification substantially in the form of a revised Final
Certification, with respect to such Substitute Mortgage Loans, with any
exceptions noted thereon. Scheduled Payments due with respect to Substitute
Mortgage Loans in the month of substitution shall not be included as part of the
Trust Fund and shall be retained by the Seller. For the month of substitution,
distributions to Noteholders shall reflect the collections and recoveries in
respect of such Deleted Mortgage Loan in the Due Period preceding the month of
substitution and the Seller shall thereafter be entitled to retain all amounts
subsequently received in respect of such Deleted Mortgage Loan. Upon such
substitution, such Substitute Mortgage Loan shall constitute part of the Trust
Fund and shall be subject in all respects to the terms of this Agreement and the
Sale Agreement, including all representations and warranties thereof included in
the Sale Agreement, in each case as of the date of substitution.
For any month in which the Seller substitutes one or more Substitute
Mortgage Loans for one or more Deleted Mortgage Loans, the related Servicer
shall determine the excess (each, a "SUBSTITUTION ADJUSTMENT Amount"), if any,
by which the aggregate Purchase Price of all such Deleted Mortgage Loans exceeds
the aggregate Scheduled Principal Balance of the Substitute Mortgage Loans
replacing such Deleted Mortgage Loans, together with one month's interest on
such excess amount at the applicable Net Mortgage Rate. On the date of such
substitution, the Seller shall deliver or cause to be delivered to the Servicer
for deposit in the related Collection Account an amount equal to the related
Substitution Adjustment Amount, if any, and the Indenture Trustee, upon receipt
of the related Substitute Mortgage Loan or Loans and certification by the
related Servicer of such deposit, shall release to the Seller the related
Mortgage File or Files and shall execute and deliver such instruments of
transfer or assignment,
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in each case without recourse, as the Seller shall deliver to it and as shall be
necessary to vest therein any Deleted Mortgage Loan released pursuant hereto.
ARTICLE X
SUPPLEMENTAL INDENTURES
SECTION 10.1 Supplemental Indentures Without Consent of Noteholders.
(a) Without the consent of the Holders of any Notes but with prior written
notice to the Rating Agencies and with the prior written consent of the Issuer
and the Indenture Trustee, when authorized by an Issuer Order, at any time and
from time to time, may enter into one or more indentures supplemental hereto
(which shall conform to the provisions of the Trust Indenture Act as in force at
the date of the execution thereof), in form satisfactory to the Indenture
Trustee, for any of the following purposes:
(i) to correct or amplify the description of any property at any time
subject to the lien of this Indenture, or better to assure, convey and
confirm unto the Indenture Trustee any property subject or required to be
subjected to the lien of this Indenture, or to subject to the lien of this
Indenture additional property;
(ii) to evidence the succession, in compliance with the applicable
provisions hereof, of another person to the Issuer, and the assumption by
any such successor of the covenants of the Issuer herein and in the Notes
contained;
(iii) to add to the covenants of the Issuer, for the benefit of the
Holders of the Notes or to surrender any right or power herein conferred
upon the Issuer;
(iv) to (A) cure any ambiguity, (B) correct or supplement any
provision herein or in any supplemental indenture that may be inconsistent
with any other provisions herein or in any supplemental indenture or to
conform the provisions hereof to those of any Offering Document, (C) obtain
a rating for the Notes from a nationally recognized statistical rating
organization, or (D) make any other provisions with respect to matters or
questions arising under this Indenture; provided, however, that no such
supplemental indenture entered into pursuant to clause (D) of this
subparagraph (iv) shall adversely affect in any material respect the
interests of any Holder not consenting thereto;
(v) to evidence and provide for the acceptance of the appointment
hereunder of a successor Indenture Trustee with respect to the Notes and to
add to or change any of the provisions of this Indenture as shall be
necessary to facilitate the administration of the trusts hereunder by more
than one Indenture Trustee, pursuant to the requirements of Article VI; or
(vi) to modify, eliminate or add to the provisions of this Indenture
to such extent as shall be necessary to effect the qualification of this
Indenture under the TIA or under any similar federal statute hereafter
enacted and to add to this Indenture such other provisions as may be
expressly required by the TIA.
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provided, however, that no such supplemental indenture shall be entered into
unless the Indenture Trustee shall have received an Opinion of Counsel stating
that entering into such supplemental indenture will not (A) result in a
"substantial modification" of the Notes under Treasury Regulation Section
1.1001.3 or adversely affect the status of the Notes as indebtedness for federal
income tax purposes or (B) cause the Trust to be subject to an entity level tax.
The Indenture Trustee is hereby authorized to join in the execution of any
such supplemental indenture and to make any further appropriate agreements and
stipulations that may be therein contained.
(b) The Issuer and the Indenture Trustee, when authorized by an Issuer
Order, may, also without the consent of any Noteholder and prior notice to the
Rating Agencies, enter into an indenture or indentures supplemental hereto for
the purpose of adding any provisions to, or changing in any manner or
eliminating any of the provisions of, this Indenture or of modifying in any
manner the rights of the Noteholders under this Indenture; provided, however,
that such action shall not, as evidenced by either (i) an Opinion of Counsel or
(ii) satisfaction of the Rating Agency Condition, adversely affect in any
material respect the interests of any Noteholder.
SECTION 10.2 Supplemental Indentures with Consent of Noteholders. The
Issuer and the Indenture Trustee, when authorized by an Issuer Order, also may,
with the prior consent of the Rating Agencies and with the consent of Holders of
not less than 66-2/3% of the Outstanding Amount of Notes, enter into an
indenture or indentures supplemental hereto for the purpose of adding any
provisions to, or changing in any manner or eliminating any of the provisions
of, this Indenture or of modifying in any manner the rights of the Holders of
the Notes under this Indenture; provided, however, that no such supplemental
indenture shall, without the consent of the Holder of each Outstanding Note
affected thereby:
(a) change the date of payment of any installment of principal of or
interest on any Note, or reduce the principal amount thereof, the interest rate
thereon, change the provisions of this Indenture relating to the application of
collections on, or the proceeds of the sale of, the Collateral to payment of
principal of or interest on the Notes, or change any place of payment where, or
the coin or currency in which, any Note or the interest thereon is payable, or
impair the right to institute suit for the enforcement of the provisions of this
Indenture requiring the application of funds available therefor, as provided in
Article V, to the payment of any such amount due on the Notes on or after the
respective due dates thereof (or, in the case of redemption, on or after the
Redemption Date);
(b) reduce the percentage of the Outstanding Amount of the Notes, the
consent of the Holders of which is required for any such supplemental indenture,
or the consent of the Holders of which is required for any waiver of compliance
with certain provisions of this Indenture or certain defaults hereunder and
their consequences provided for in this Indenture;
(c) modify or alter the provisions of the proviso to the definition of the
term "Outstanding";
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(d) reduce the percentage of the Outstanding Amount of the Notes required
to direct the Indenture Trustee to direct the Issuer to sell or liquidate the
Collateral pursuant to Section 5.4;
(e) modify any provision of this Section except to increase any percentage
specified herein or to provide that certain additional provisions of this
Indenture or the Operative Agreements cannot be modified or waived without the
consent of the Holder of each Outstanding Note affected thereby;
(f) modify any of the provisions of this Indenture in such manner as to
affect the calculation of the amount of any payment of interest or principal due
on any Note on any Distribution Date; or
(g) permit the creation of any lien ranking prior to or on a parity with
the lien of this Indenture with respect to any part of the Collateral or, except
as otherwise permitted or contemplated herein, terminate the lien of this
Indenture on any property at any time subject hereto or deprive the Holder of
any Note of the security provided by the lien of this Indenture.
The Indenture Trustee may rely on an Opinion of Counsel (at the expense of
the party requesting the supplemental indenture) regarding whether or not any
Notes would be affected by any supplemental indenture and any such determination
shall be conclusive upon the Holders of all Notes, whether theretofore or
thereafter authenticated and delivered hereunder.
In connection with requesting the consent of the Noteholders pursuant to
this Section, the Issuer shall mail to the Holders of the Notes to which such
amendment or supplemental indenture relates and to the Owner Trustee a notice
setting forth in general terms the substance of such supplemental indenture. It
shall not be necessary for any Act of Noteholders under this Section to approve
the particular form of any proposed supplemental indenture, but it shall be
sufficient if such Act shall approve the substance thereof.
SECTION 10.3 Execution of Supplemental Indentures. In executing, or
permitting the additional trusts created by, any supplemental indenture
permitted by this Article IX or the modification thereby of the trusts created
by this Indenture, the Indenture Trustee shall be entitled to receive, and
subject to Sections 6.01 and 6.02, shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such supplemental indenture is
authorized or permitted by this Indenture. The Indenture Trustee may, but shall
not be obligated to, enter into any such supplemental indenture that affects the
Indenture Trustee's own rights, duties, liabilities or immunities under this
Indenture or otherwise.
SECTION 10.4 Effect of Supplemental Indenture. Upon the execution of any
supplemental indenture pursuant to the provisions hereof, this Indenture shall
be and shall be deemed to be modified and amended in accordance therewith with
respect to the Notes affected thereby, and the respective rights, limitations of
rights, obligations, duties, liabilities and immunities under this Indenture of
the Indenture Trustee, the Issuer and the Holders of the Notes shall thereafter
be determined, exercised and enforced hereunder subject in all respects to such
modifications and amendments, and all the terms and conditions of any such
supplemental
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indenture shall be and be deemed to be part of the terms and conditions of this
Indenture for any and all purposes.
SECTION 10.5 Conformity with Trust Indenture Act. Every amendment of this
Indenture and every supplemental indenture executed pursuant to this Article IX
shall conform to the requirements of the Trust Indenture Act as then in effect
so long as this Indenture shall then be qualified under the Trust Indenture Act.
SECTION 10.6 Reference in Notes to Supplemental Indentures. Notes
authenticated and delivered after the execution of any supplemental indenture
pursuant to this Article IX may, and if required by the Indenture Trustee shall,
bear a notation in form approved by the Indenture Trustee as to any matter
provided for in such supplemental indenture. If the Issuer or the Indenture
Trustee shall so determine, new Notes so modified as to conform, in the opinion
of the Indenture Trustee and the Issuer, to any such supplemental indenture may
be prepared and executed by the Issuer and authenticated and delivered by the
Indenture Trustee in exchange for Outstanding Notes.
SECTION 10.7 Amendments to Trust Agreement. The Indenture Trustee shall,
upon Issuer Order, consent to any proposed amendment to the Trust Agreement or
an amendment to or waiver of any provision of any other document relating to the
Trust Agreement, such consent to be given without the necessity of obtaining the
consent of the Holders of any Notes upon satisfaction of the requirements under
Section 11.1 of the Trust Agreement.
Nothing in this Section shall be construed to require that any Person
obtain the consent of the Indenture Trustee to any amendment or waiver or any
provision of any document where the making of such amendment or the giving of
such waiver without obtaining the consent of the Indenture Trustee is not
prohibited by this Indenture or by the terms of the document that is the subject
of the proposed amendment or waiver.
ARTICLE XI
DISPOSITION OF THE COLLATERAL; REDEMPTION OF THE NOTES
SECTION 11.1 Redemption of the Notes.
(a) All the Notes may be redeemed in whole, but not in part, on the
Redemption Date at the Redemption Price at the option of the holders of a
majority of the percentage interests of the Certificates provided, however, that
funds in an amount equal to the Redemption Price, any unreimbursed Servicing
Advances and any unreimbursed amounts due and owing to the Indenture Trustee
hereunder, must have been deposited with the Indenture Trustee prior to the
Indenture Trustee's giving notice of such redemption pursuant to Section 11.2 or
the Issuer shall have complied with the requirements for satisfaction and
discharge of the Notes specified in Section 4.1. Notice of the election to
redeem the Notes shall be furnished to the Indenture Trustee and each Noteholder
not later than 30 days prior to the Distribution Date selected for such
redemption, whereupon all such Notes shall be due and payable on such
Distribution Date upon the furnishing of a notice pursuant to Section 11.2 to
each Holder of such Notes and the Note Issuer.
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(b) Upon receipt of the notice from the party exercising its election to
redeem the Notes pursuant to Section 11.1(a), the Indenture Trustee shall
prepare and deliver to the Issuer, no later than the related Redemption Date, a
Distribution Date Statement stating therein that it has determined that the
conditions to redemption at the option of the Issuer have been satisfied and
setting forth the amount, if any, to be withdrawn from the Distribution Account
and paid to the Servicer as reimbursement for Servicing Advances and such other
information as may be required to accomplish such redemption.
(c) The Notes may be redeemed in whole, but not in part, on a Distribution
Date specified by the Issuer at any time upon a determination by the Issuer,
based on an Opinion of Counsel addressed to the Issuer, the Indenture Trustee
and the Noteholders, that a substantial risk exists that the Notes will not be
treated for federal income tax purposes as evidence of indebtedenss.
SECTION 11.2 Form of Redemption Notice. Notice of redemption under Section
11.1 hereof shall be given by the Indenture Trustee by first-class mail, postage
prepaid, or by facsimile mailed or transmitted not later than ten days prior to
the applicable Redemption Date to each Holder of the Notes to be redeemed, as of
the close of business on the Record Date preceding the applicable Redemption
Date, at such Holder's address or facsimile number appearing in the Note
Register.
All notices of redemption shall state:
(a) the Redemption Date;
(b) the Redemption Price;
(c) that on a Redemption Date, if the Notes are not to be paid in full, (i)
the Redemption Price will become due and payble only with respect to the Notes
as shall be specified in such notice and that the amount payable in respect of
the redeemed Notes shall be limited to the Redemption Price therefor and (ii)
that interest thereon shall cease to accrue on the date specified on the notice
for, and that payment of the Redemption Price will be made to, the Persons whose
names appear as the registered holders thereof on the Note Register as of the
Record Date applicable to such Redemption Date and identified in such notice of
redemption;
(d) that on a Redemption Date, if the Notes are to be paid in full, (i) the
fact of such payment in full and that interest thereon shall cease to accrue on
the date specified on the notice and (ii) that the payment of all other amounts
described in Section 7.01(a)(ii) of the Servicing Agreement will be made; and
(e) the place where such Notes are to be surrendered for payment of the
Redemption Price (which shall be the office or agency of the Issuer to be
maintained as provided in Section 3.02 hereof).
Notice of redemption of the Notes shall be given by the Indenture Trustee
in the name of the Issuer and at the expense of [ o ]. Failure to give to any
Holder of any Note notice of redemption, or any defect therein, shall not impair
or affect the validity of the redemption of any other Note.
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SECTION 11.3 Notes Payable on Redemption Date. Notes to be redeemed shall,
following notice of redemption as required by Section 11.2 hereof (in the case
of redemption pursuant to Section 11.1) hereof, on the applicable Redemption
Date become due and payable at the Redemption Price and (unless the Issuer shall
default in the payment of the Redemption Price) no interest shall accrue thereon
for any period after the date to which accrued interest is calculated for
purposes of calculating the Redemption Price. The Issuer may not redeem the
Notes unless (i) all outstanding obligations under the Notes have been paid in
full and (ii) the Indenture Trustee has been paid all amounts to which it is
entitled hereunder.
ARTICLE XII
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS BY THE MASTER SERVICER
SECTION 12.1 Duties of the Master Servicer; Enforcement of Servicers'
Obligations.
(a) The Master Servicer, on behalf of the Indenture Trustee, the Depositor
and the Noteholders shall monitor the performance of each Servicer, and shall
use its reasonable good faith efforts to cause each Servicer to duly and
punctually perform all of its duties and obligations in accordance with the
terms of the applicable Servicing Agreement (including the obligation of each
Servicer to maintain an errors and omissions policy and Fidelity Bond). Upon the
occurrence of an "Event of Default" (as defined in the applicable Servicing
Agreement) of which an Authorized Officer of the Master Servicer has actual
knowledge, the Master Servicer shall promptly notify the Indenture Trustee
thereof, and shall specify in such notice the action, if any, the Master
Servicer is taking in respect of such default. So long as any such default shall
be continuing, the Master Servicer may, and shall if it determines such action
to be in the best interests of Noteholders, (i) terminate all of the rights and
powers of such Servicer as provided in the applicable Servicing Agreement; (ii)
exercise any rights it may have to enforce the Servicing Agreement against such
Servicer; and/or (iii) waive any such default or take any other action with
respect to such default as is permitted thereunder.
(b) Upon any termination by the Master Servicer of a Servicer's rights and
powers pursuant to the Servicing Agreement, subject to Section 12.11 the Master
Servicer shall either (i) with the consent of the Indenture Trustee and the
Rating Agencies, such consent not to be unreasonably withheld, and in accordance
with the applicable provisions of the Servicing Agreement, appoint a successor
servicer under the related Servicing Agreement or (ii) assume the obligations of
the terminated Servicer under the related Servicing Agreement; provided,
however, that it is understood and agreed by the parties hereto that there will
be a period of transition (not to exceed 90 days) before the actual servicing
functions can be fully transferred to a successor servicer (including the Master
Servicer). In connection with the appointment of any successor servicer, the
Master Servicer may make such arrangements for the compensation of such
successor as it and such successor shall agree, but in no event shall such
compensation of any successor servicer (including the Master Servicer) be in
excess of that payable to the nominated Servicer.
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(c) The Master Servicer shall pay the costs of such enforcement (including
the termination of any Servicer, the appointment of a successor servicer or the
transfer and assumption of the servicing by the Master Servicer) at its own
expense and shall be reimbursed therefor initially (i) by the terminated
Servicer, (ii) from a general recovery resulting from such enforcement only to
the extent, if any, that such recovery exceeds all amounts due in respect of the
related Mortgage Loans, (iii) from a specific recovery of costs, expenses or
attorney's fees against the party against whom such enforcement is directed, or
(iv) to the extent that such amounts described in (i)-(iii) above are
insufficient to reimburse the Master Servicer for such costs of enforcement,
from the Trust Fund, as provided in Section 12.2.
(d) If the Master Servicer assumes the servicing with respect to any of the
Mortgage Loans, it will not assume liability for the representations and
warranties of any Servicer it replaces or for the errors or omissions of such
Servicer.
(i) Upon any termination of a Servicer's rights and powers pursuant to
its Servicing Agreement, the Master Servicer shall promptly notify the
Indenture Trustee and the Rating Agencies, specifying in such notice that
the Master Servicer or any successor servicer, as the case may be, has
succeeded the Servicer, which notice shall also specify the name and
address of any such successor servicer.
(ii) Neither the Depositor nor the Indenture Trustee shall consent to
the assignment by any Servicer of such Servicer's rights and obligations
under the related Servicing Agreement without the prior written consent of
the Master Servicer, which consent shall not be unreasonably withheld.
(e) The Master Servicer is hereby authorized and empowered by the Indenture
Trustee, on behalf of the Noteholders and the Indenture Trustee, in its own name
or in the name of any Servicer, when the Master Servicer or the related
Servicer, as the case may be, believes it appropriate in its best judgment to
register any Mortgage Loan on the MERS(R) System, or cause the removal from the
registration of any Mortgage Loan on the MERS(R) System, to execute and deliver,
on behalf of the Indenture Trustee and the Noteholders of any of them, any and
all instruments of assignment and other comparable instrument with respect to
such assignment or re-recording of a Mortgage in the name of MERS, solely as
nominee for the Indenture Trustee and its successors and assigns. Any expenses
incurred in connection with the actions described in the preceding sentence
shall be borne by the Master Servicer, with no right of reimbursement; provided,
that if, as a result of MERS discontinuing or becoming unable to continue
operations in connection with the MERS System, it becomes necessary to remove
any Mortgage Loan from registration on the MERS System and to arrange for the
assignment of the related Mortgages to the Indenture Trustee, then any related
expenses shall be reimbursable to the Master Servicer.
SECTION 12.2 Compensation to the Master Servicer. The Master Servicer shall
be entitled to be paid by the Trust Fund, and may either retain or withdraw from
the Distribution Account, (i) its Master Servicing Fee with respect to each
Distribution Date, (ii) amounts necessary to reimburse itself for any previously
unreimbursed Monthly Advances, Servicer Advances and Non-recoverable Advances in
accordance with the definition of "Available Distribution Amount" and (iii)
amounts representing assumption fees, late payment charges or other ancillary
income not included in the definition of "Available Distribution Amount" and
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which are not required to be remitted by the Servicers to the Indenture Trustee
or deposited by the Indenture Trustee into the Distribution Account. The Master
Servicer shall be required to pay all expenses incurred by it in connection with
its activities hereunder and shall not be entitled to reimbursement therefor
except as provided in this Agreement.
SECTION 12.3 Merger or Consolidation. Any Person into which the Master
Servicer may be merged or consolidated, or any Person resulting from any merger,
conversion, other change in form or consolidation to which the Master Servicer
shall be a party, or any Person succeeding to the business of the Master
Servicer, shall be the successor to the Master Servicer hereunder, without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, anything herein to the contrary notwithstanding; provided,
however, that the successor or resulting Person to the Master Servicer shall be
a Person that shall be qualified and approved to service mortgage loans for
Xxxxxx Xxx or Xxxxxxx Mac and shall have a net worth of not less than
$15,000,000.
SECTION 12.4 Resignation of Master Servicer. Except as otherwise provided
in Sections 12.3 and 12.5 hereof, the Master Servicer shall not resign from the
obligations and duties hereby imposed on it unless the Master Servicer's duties
hereunder are no longer permissible under applicable law or are in material
conflict by reason of applicable law with any other activities carried on by it
and cannot be cured. Any such determination permitting the resignation of the
Master Servicer shall be evidenced by an Opinion of Counsel that shall be
Independent to such effect delivered to the Indenture Trustee. No such
resignation shall become effective until the Indenture Trustee shall have
assumed, or a successor master servicer shall have been appointed by the
Indenture Trustee and until such successor shall have assumed, the Master
Servicer's responsibilities and obligations under this Agreement. Notice of such
resignation shall be given promptly by the Master Servicer and the Depositor to
the Indenture Trustee.
If, at any time, the Master Servicer resigns under this Section, or
transfers or assigns its rights and obligations under Section 12.5, then at such
time as [o] also shall resign (and shall be entitled to resign) as Securities
Administrator under this Agreement. In such event, the obligations of each such
party shall be assumed by the Indenture Trustee or such successor master
servicer appointed by the Indenture Trustee (subject to the provisions of
Section 12.2).
SECTION 12.5 Assignment or Delegation of Duties by the Master Servicer.
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, or delegate to or subcontract with, or authorize or appoint any other
Person to perform any of the duties, covenants or obligations to be performed by
the Master Servicer hereunder; provided, however, that the Master Servicer shall
have the right with the prior written consent of the Indenture Trustee and the
Depositor (which consent shall not be unreasonably withheld), and upon delivery
to the Indenture Trustee and the Depositor of a letter from each Rating Agency
to the effect that such action shall not result in a downgrading of the Notes,
to delegate or assign to or subcontract with or authorize or appoint any
qualified Person to perform and carry out any duties, covenants or obligations
to be performed and carried out by the Master Servicer hereunder. Notice of such
permitted assignment shall be given promptly by the Master Servicer to the
Depositor and the Indenture Trustee. If, pursuant to any provision hereof, the
duties of the Master Servicer are
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transferred to a successor master servicer, the entire amount of the Master
Servicing Fees and other compensation payable to the Master Servicer pursuant
hereto shall thereafter be payable to such successor Master Servicer. Such
successor Master Servicer shall also pay the fees of the Indenture Trustee and
the Securities Administrator, as provided herein.
SECTION 12.6 Limitation on Liability of the Master Servicer. Neither the
Master Servicer nor any of the directors, officers, employees or agents of the
Master Servicer shall be under any liability to the Indenture Trustee or the
Noteholders 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 Master Servicer or any such
person against any liability that would otherwise be imposed by reason of
willful misfeasance, bad faith or negligence in its performance of its duties or
by reason of reckless disregard for its obligations and duties under this
Agreement. The Master Servicer and any director, officer, employee or agent of
the Master Servicer may rely in good faith on any document of any kind prima
facie properly executed and submitted by any Person respecting any matters
arising hereunder. The Master Servicer shall be under no obligation to appear
in, prosecute or defend any legal action that is not incidental to its duties to
master service the Mortgage Loans in accordance with this Agreement and that in
its opinion may involve it in any expenses or liability; provided, however, that
the Master Servicer may in its sole discretion undertake any such action that it
may deem necessary or desirable in respect to this Agreement and the rights and
duties of the parties hereto and the interests of the Noteholders hereunder. In
such event, the legal expenses and costs of such action and any liability
resulting therefrom shall be expenses, costs and liabilities of the Trust Fund
and the Master Servicer shall be entitled to be reimbursed therefor out of the
Distribution Account.
The Master Servicer shall not be liable for any acts or omissions of any
Servicer except to the extent that damages or expenses are incurred as a result
of such act or omissions and such damages and expenses would not have been
incurred but for the negligence, willful misfeasance, bad faith or recklessness
of the Master Servicer in supervising, monitoring and overseeing the obligations
of the Servicers in this Agreement.
SECTION 12.7 Indemnification; Third-Party Claims. The Master Servicer
agrees to indemnify the Depositor, the Securities Administrator and the
Indenture Trustee, and hold them harmless against any and all claims, losses,
penalties, fines, forfeitures, legal fees and related costs, judgments, and any
other costs, liability, fees and expenses that the Depositor, the Securities
Administrator or the Indenture Trustee may sustain as a result of the Master
Servicer's willful misfeasance, bad faith or negligence in the performance of
its duties hereunder or by reason of its reckless disregard for its obligations
and duties under this Agreement. The Depositor, the Securities Administrator and
the Indenture Trustee shall immediately notify the Master Servicer if a claim is
made by a third party with respect to this Agreement or the Mortgage Loans
entitling the Depositor, the Securities Administrator or the Indenture Trustee
to indemnification under this Section 12.7, whereupon the Master Servicer shall
assume the defense of any such claim and pay all expenses in connection
therewith, including counsel fees, and promptly pay, discharge and satisfy any
judgment or decree which may be entered against it or them in respect of such
claim.
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SECTION 12.8 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 Indenture
Trustee for distribution to the Noteholders any payment required to be made
under the terms of the Notes 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 Indenture Trustee, or to the
Master Servicer, the Depositor and the Indenture Trustee by the Holders of
Notes 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 other of the covenants or agreements on
the part of the Master Servicer contained in this Agreement, which
continues unremedied for a period of 30 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 Indenture Trustee, or to the Master Servicer, the Depositor and the
Indenture Trustee by the Holders of Notes 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, marshalling 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 such decree or
order shall have remained in force undischarged or unstayed for a period of
90 days; or
(iv) the Master Servicer shall consent to the appointment of a
conservator or receiver or liquidator in any insolvency, readjustment of
debt, marshalling of assets and liabilities or similar proceedings of or
relating to it or of or relating to all or substantially all of its
property; or
(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) The Master Servicer shall be dissolved, or shall dispose of all
or substantially all of its assets, or consolidate with or merge into
another entity or shall permit another entity to consolidate or merge into
it, such that the resulting entity does not meet the criteria for a
successor Servicer as specified in Section 12.3 hereof; or
(vii) If a representation or warranty of the Master Servicer shall
prove to be incorrect as of the time made in any respect that materially
and adversely affects the interests of the Noteholders, and the
circumstance or condition in respect of which such representation or
warranty was incorrect shall not have been eliminated or cured within
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30 days after the date on which written notice of such incorrect
representation or warranty shall have been given to the Master Servicer by
the Indenture Trustee or the Securities Administrator, or to the Master
Servicer, the Securities Administrator and the Indenture Trustee by the
Holders of Notes entitled to at least 25% of the Voting Rights; or
(viii) A sale or pledge of any of the rights of the Master Servicer
hereunder or an assignment of this Agreement by the Master Servicer or a
delegation of the rights or duties of the Master Servicer hereunder shall
have occurred in any manner not otherwise permitted hereunder and without
the prior written consent of the Indenture Trustee and Holders of Notes
entitled to at least 25% of the Voting Rights; or
(ix) After receipt of notice from the Indenture Trustee, any failure
of the Master Servicer to make any Advances required to be made hereunder.
If a Master Servicer Event of Default described in clauses (i) through (ix)
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 or the Indenture Trustee may, and at the written direction of the
Holders of Notes entitled to at least 51% of Voting Rights, the Indenture
Trustee shall, by notice in writing to the Master Servicer (and to the Depositor
if given by the Indenture Trustee or to the Indenture Trustee if given by 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. Any such
notice to the Master Servicer shall also be given to each Rating Agency and the
Depositor. 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 Notes (other than as a Holder of any Note) or the
Mortgage Loans or otherwise, shall pass to and be vested in the Indenture
Trustee (or if another successor Master Servicer shall at such time have already
been appointed in accordance with Section 12.9, in such successor Master
Servicer) pursuant to and under this Section (subject to Section 12.9), and,
without limitation, the Indenture Trustee (or such other successor Master
Servicer appointed in accordance with Section 12.9) 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 promptly (and in any
event no later than ten Business Days subsequent to such notice) to provide the
Indenture Trustee (or such other successor Master Servicer appointed in
accordance with Section 12.9) with all documents and records in the Master
Servicer's possession requested by the Indenture Trustee (or such other
successor Master Servicer appointed in accordance with Section 12.9) to enable
the Indenture Trustee (or such other successor Master Servicer appointed in
accordance with Section 12.9) to assume the Master Servicer's functions under
this Agreement, and to cooperate with the Indenture Trustee (or such other
successor Master Servicer appointed in accordance with Section 12.9) 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 Indenture Trustee (or such other successor Master Servicer
appointed in accordance with Section 12.9) for administration by it of all cash
amounts which at the time shall
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be or should have been credited by the Master Servicer to the Collection 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 under this Agreement on
or prior to the date of such termination, and shall continue to be entitled to
the benefits of Section 12.6, notwithstanding any such termination, with respect
to events occurring prior to such termination). For purposes of this Section
12.8, the Indenture Trustee shall not be deemed to have knowledge of a Master
Servicer Event of Default unless a Responsible Officer of the Indenture Trustee
assigned to and working in the Indenture Trustee's Corporate Trust Office has
actual knowledge thereof or unless written notice of any event which is in fact
such a Master Servicer Event of Default is received by the Indenture Trustee and
such notice references the Notes, the Trust Fund or this Agreement.
SECTION 12.9 Indenture Trustee to Act; Appointment of Successor.
(a) On and after the time the Master Servicer receives a notice of
termination, the Indenture 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 all the responsibilities,
duties and liabilities relating thereto and arising thereafter shall be assumed
by the Indenture Trustee (except for any representations or warranties of the
Master Servicer under this Agreement, the responsibilities, duties and
liabilities contained in Section 12.1 and the obligation to deposit amounts in
respect of losses pursuant to Section 12.1) by the terms and provisions hereof;
provided, however, that any failure to perform such duties or responsibilities
during the period following the termination of the Master Servicer reasonably
necessary for the Indenture Trustee as successor to the Master Servicer
hereunder to assume the duties and responsibilities of the Master Servicer or
caused by the Master Servicer's failure to provide information, documents or
funds (or any other items reasonably requested by the Indenture Trustee in order
to succeed to the Master Servicer's responsibilities, duties and liabilities
hereunder) required by Section 12.8 shall not be considered a default by the
Indenture Trustee as successor to the Master Servicer hereunder and shall not
result in any liability to the Indenture Trustee. As compensation therefor, the
Indenture Trustee shall be entitled to the Master 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. Notwithstanding the above, the
Indenture 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 Notes entitled to at least 51% of
the Voting Rights so request in writing to the Indenture Trustee, promptly
appoint, or petition a court of competent jurisdiction to appoint, an
established mortgage loan servicing institution acceptable to each Rating Agency
and having a net worth of not less than $50,000,000, 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.
The appointment of a successor Master Servicer shall not affect any
liability of the predecessor Master Servicer which may have arisen under this
Agreement prior to its termination as Master Servicer to indemnify the Indenture
Trustee pursuant to Section 12.7, nor shall any successor Master Servicer be
liable for any acts or omissions of the predecessor Master Servicer or for any
breach by such Master Servicer of any of its representations or warranties
contained
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herein or in any related document or agreement. The Indenture Trustee and such
successor shall take such action, consistent with this Agreement, as shall be
necessary to effectuate any such succession. All costs and expenses associated
with the transfer of the master servicing responsibilities shall be paid by the
terminated Master Servicer upon presentation of reasonable documentation of such
costs.
(b) 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 Indenture
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 Indenture 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 Indenture Trustee shall act in
such capacity as hereinabove provided.
(c) In connection with the termination or resignation of the Master
Servicer hereunder, either (i) the successor Master Servicer, including the
Indenture Trustee if the Indenture Trustee is acting as successor Master
Servicer, shall represent and warrant that it is a member of MERS in good
standing and shall agree to comply in all material respects with the rules and
procedures of MERS in connection with the servicing of the Mortgage Loans that
are registered with MERS, in which case the predecessor Master Servicer shall
cooperate with the successor Master Servicer in causing MERS to revise its
records to reflect the transfer of servicing to the successor Master Servicer as
necessary under MERS' rules and regulations, or (ii) the predecessor Master
Servicer shall cooperate with the successor Master Servicer in causing MERS to
execute and deliver an assignment of Mortgage in recordable form to transfer the
Mortgage from MERS to the Indenture Trustee and to execute and deliver such
other notices, documents and other instruments as may be necessary or desirable
to effect a transfer of such Mortgage Loan or servicing of such Mortgage Loan on
the MERS(R) System to the successor Master Servicer. The predecessor Master
Servicer shall file or cause to be filed any such assignment in the appropriate
recording office. The predecessor Master Servicer shall bear any and all fees of
MERS, costs of preparing any assignments of Mortgage, and fees and costs of
filing any assignments of Mortgage that may be required under this subsection
(c). The successor Master Servicer shall cause such assignment to be delivered
to the Indenture Trustee or the Custodian promptly upon receipt of the original
with evidence of recording thereon or a copy certified by the public recording
office in which such assignment was recorded.
SECTION 12.10 Notification to Noteholders.
(a) Upon any termination of the Master Servicer pursuant to Section 12.8
above or any appointment of a successor to the Master Servicer pursuant to
Section 12.9 above, the Indenture Trustee shall give prompt written notice
thereof to the Noteholders at their respective addresses appearing in the Note
Register.
(b) Not later than the later of (i) 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
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Event of Default and (ii) five days after a Responsible Officer of the Indenture
Trustee becomes aware of the occurrence of such an event, the Indenture Trustee
shall transmit by mail to all Holders of Notes notice of each such occurrence,
unless such default or Master Servicer Event of Default shall have been cured or
waived.
SECTION 12.11 Master Servicer to Act as Servicer; Appointment of Successor.
On and after the time any Servicer resigns or is terminated pursuant to the
terms of the applicable Servicing Agreement, the Master Servicer either shall
appoint a successor servicer pursuant to the related Servicing Agreement or
shall assume the obligations of such Servicer in its capacity as Servicer under
the related Servicing Agreement and the transactions set forth or provided for
herein and shall be subject to all the responsibilities, duties and liabilities
relating thereto placed on such Servicer by the terms and provisions of the
applicable Servicing Agreement and applicable law. As compensation therefor, the
Master Servicer shall be entitled to all funds relating to the Mortgage Loans
that the Servicer would have been entitled to charge to the related Collection
Account if the Servicer had continued to act hereunder. Notwithstanding the
foregoing, if the Master Servicer has become the successor to a Servicer, the
Master Servicer may, if it shall be unwilling to so act, or if it is otherwise
unable to so act, appoint, or petition a court of competent jurisdiction to
appoint, any established mortgage loan servicing institution the appointment of
which does not adversely affect the then current rating of the Notes by each
Rating Agency as the successor to the related Servicer pursuant to the
applicable Servicing Agreement in the assumption of all or any part of the
responsibilities, duties or liabilities of the Servicer thereunder. Any
successor to any Servicer shall be an institution which is a Xxxxxx Xxx and
Xxxxxxx Mac approved seller/servicer in good standing, which has a net worth of
at least $15,000,000, and which is willing to service the Mortgage Loans and
executes and delivers to the Depositor and the Master Servicer, an agreement
accepting such delegation and assignment, which contains an assumption by such
Person of the rights, powers, duties, responsibilities, obligations and
liabilities of such Servicer), with like effect as if originally named as a
party to the related Servicing Agreement; and provided further that each Rating
Agency acknowledges that its rating of the Notes in effect immediately prior to
such assignment and delegation shall not be qualified or reduced as a result of
such assignment and delegation. Pending appointment of a successor to the
terminated Servicer, the Master Servicer shall act in such capacity as
hereinabove provided. In connection with such appointment and assumption, the
Master Servicer 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 the
Servicing Fee permitted to the related Servicer pursuant to the Servicing
Agreement. The Master Servicer and such successor shall take such action,
consistent with this Agreement, as shall be necessary to effectuate any such
succession. Neither the Master Servicer nor any other successor Servicer shall
be deemed to be in default hereunder by reason of any failure to make, or any
delay in making, any distribution hereunder or any portion thereof or any
failure to perform, or any delay in performing, any duties or responsibilities
hereunder, in either case caused by the failure of any Servicer to deliver or
provide, or any delay in delivering or providing, any cash, information,
documents or records to it.
Any successor to any of the Servicers as Servicer shall give notice to the
Mortgagors of such change of servicer and shall, during the term of its service
as Servicer maintain in force the policy or policies that such Servicer is
required to maintain pursuant to its Servicing Agreement.
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SECTION 12.12 Notification to Noteholders.
(a) Upon any termination of or appointment of a successor to the Servicer,
the Master Servicer or the Indenture Trustee, as applicable, shall give prompt
written notice thereof to Noteholders and to each Rating Agency.
(b) Within 60 days after the occurrence of any Master Servicer Event of
Default, the Master Servicer or the Indenture Trustee, as applicable, shall
transmit by mail to all Noteholders notice of each such Master Servicer Event of
Default hereunder known to the Master Servicer or the Indenture Trustee, as
applicable, unless such Master Servicer Event of Default shall have been cured
or waived.
SECTION 12.13 Records; Confidentiality.
(a) The Master Servicer shall maintain appropriate books of account and
records relating to services performed hereunder, which books of account and
records shall be accessible for inspection and copying by the Depositor (at the
Depositor's expense) upon reasonable prior notice during normal business hours.
(b) The Master Servicer hereby covenants to hold and treat all Confidential
Information in confidence in accordance with this Section 12.13(b). The Master
Servicer, including its subsidiaries, affiliates, directors, officers,
employees, agents or controlling persons, agrees that it (i) shall comply with
any applicable laws and regulations regarding the privacy and security of
Confidential Information; (ii) shall not use Confidential Information in any
manner inconsistent with any applicable laws and regulations regarding the
privacy and security of such Confidential Information; (iii) shall not disclose
Confidential Information to third parties without the prior written consent of
the Mortgagor other than for the purpose of taking permitted action under this
Agreement or any other agreement; (iv) shall maintain adequate physical,
technical and administrative safeguards to protect Confidential Information from
unauthorized access; and (v) shall promptly notify the Mortgagor if it has
sufficient reason to believe that there has been any breach of the
confidentiality requirements contained in this Section 12.13(b). Disclosure of
any Confidential Information by the Master Servicer at the request of its
outside auditors or governmental regulatory authorities in connection with an
examination of the Master Servicer by any such authority shall not constitute a
breach of its obligations under this Section 12.13(b) and shall not require the
prior consent of the Mortgagor so long as such disclosure is not in violation of
the Right to Financial Privacy Act of 1978, as amended, the Xxxxx-Xxxxx-Xxxxxx
Act of 1999 or other applicable law.
SECTION 12.14 Annual Officer's Certificate as to Compliance.
(a) The Master Servicer shall deliver to the Indenture Trustee and the
Rating Agencies on or before May 31 of each year, commencing on May 31, [o], an
Officer's Certificate signed by a Servicing Officer, certifying that with
respect to the period ending December 31 of the prior year: (i) such Servicing
Officer has reviewed the activities of such Master Servicer during the preceding
calendar year or portion thereof and its performance under this Agreement, (ii)
to the best of such Servicing Officer's knowledge, based on such review, such
Master Servicer has performed and fulfilled its duties, responsibilities and
obligations under this
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Agreement in all material respects throughout such year, or, if there has been a
default in the fulfillment of any such duties, responsibilities or obligations,
specifying each such default known to such Servicing Officer and the nature and
status thereof, (iii) nothing has come to the attention of such Servicing
Officer to lead such Servicing Officer to believe that any Servicer has failed
to perform any of its duties, responsibilities and obligations under its
Servicing Agreement in all material respects throughout such year, or, if there
has been a material default in the performance or fulfillment of any such
duties, responsibilities or obligations, specifying each such default known to
such Servicing Officer and the nature and status thereof.
(b) Copies of such statements shall be provided to any Noteholder upon
request, by the Master Servicer or by the Indenture Trustee at the Master
Servicer's expense if the Master Servicer failed to provide such copies (unless
(i) the Master Servicer shall have failed to provide the Indenture Trustee with
such statement or (ii) the Indenture Trustee shall be unaware of the Master
Servicer's failure to provide such statement).
SECTION 12.15 Annual Independent Accountant's Servicing Report. If the
Master Servicer has, during the course of any fiscal year, directly serviced any
of the Mortgage Loans, then the Master Servicer at its expense shall cause a
nationally recognized firm of independent certificate public accountants to
furnish a statement to the Indenture Trustee, the Rating Agencies and the Seller
on or before May 31 of each year, commencing on May 31, [o] to the effect that,
with respect to the most recently ended fiscal year, such firm has examined
certain records and documents relating to the Master Servicer's performance of
its servicing obligations under this Agreement and that, on the basis of such
examination conducted substantially in compliance with the audit program for
mortgages serviced for Xxxxxxx Mac or the Uniform Single Attestation Program for
Mortgage Bankers, such firm is of the opinion that the Master Servicer's
activities have been conducted in compliance with this Agreement, or that such
examination has disclosed no material items of noncompliance except for (i) such
exceptions as such firm believes to be immaterial, (ii) such other exceptions as
are set forth in such statement and (iii) such exceptions that the Uniform
Single Attestation Program for Mortgage Bankers or the Audit Program for
Mortgages Serviced by Xxxxxxx Mac requires it to report. Copies of such
statements shall be provided to any Noteholder upon request by the Master
Servicer, or by the Indenture Trustee at the expense of the Master Servicer if
the Master Servicer shall fail to provide such copies. If such report discloses
exceptions that are material, the Master Servicer shall advise the Indenture
Trustee whether such exceptions have been or are susceptible of cure, and will
take prompt action to do so.
ARTICLE XIII
MISCELLANEOUS
SECTION 13.1 Compliance Certificates and Opinions, etc. Upon any
application or request by the Issuer to the Indenture Trustee to take any action
under any provision of this Indenture, the Issuer shall furnish to the Indenture
Trustee (a) an Officer's Certificate stating that all conditions precedent, if
any, provided for in this Indenture relating to the proposed action have been
complied with, (b) an Opinion of Counsel stating that in the opinion of such
counsel all such conditions precedent, if any, have been complied with, and (c)
(if required by the TIA) an Independent Certificate from a firm of certified
public accountants meeting the applicable
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requirements of this Section, except that, in the case of any such application
or request as to which the furnishing of such documents is specifically required
by any provision of this Indenture, no additional certificate or opinion need be
furnished. Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(a) a statement that each signatory of such certificate or opinion has read
such covenant or condition and the definitions herein relating thereto;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of each such signatory, such signatory
has made such examination or investigation as is necessary to enable such
signatory to express an informed opinion as to whether or not such covenant or
condition has been complied with; and
(d) a statement as to whether or not, in the opinion of each such
signatory, such condition or covenant has been complied with.
SECTION 13.2 Form of Documents Delivered to Indenture Trustee. In any case
where several matters are required to be certified by, or covered by an opinion
of, any specified Person, it is not necessary that all such matters be certified
by, or covered by the opinion of, only one such Person, or that they be so
certified or covered by only one document, but one such Person may certify or
give an opinion with respect to some matters and one or more other such Persons
as to other matters, and any such Person may certify or give an opinion as to
such matters in one or several documents.
Any certificate or opinion of an Authorized Officer of the Issuer may be
based, insofar as it relates to legal matters, upon a certificate or opinion of,
or representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which such officer's certificate or opinion is
based are erroneous. Any such certificate of an Authorized Officer or Opinion of
Counsel may be based, insofar as it relates to factual matters, upon a
certificate or opinion of, or representations by, an officer or officers of the
Seller, stating that the information with respect to such factual matters is in
the possession of the Seller, unless such counsel knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to such matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Whenever in this Indenture, in connection with any application or
certificate or report to the Indenture Trustee, it is provided that the Issuer
shall deliver any document as a condition of the granting of such application,
or as evidence of the Issuer's compliance with any term hereof, it is intended
that the truth and accuracy, at the time of the granting of such application or
at the effective date of such certificate or report (as the case may be), of the
facts and opinions stated in such document shall in such case be conditions
precedent to the right of the Issuer to have such
91
application granted or to the sufficiency of such certificate or report. The
foregoing shall not, however, be construed to affect the Indenture Trustee's
right to rely upon the truth and accuracy of any statement or opinion contained
in any such document as provided in Article VI.
SECTION 13.3 Acts of Noteholders.
(a) Any request, demand, authorization, direction, notice, consent, waiver
or other action provided by this Indenture to be given or taken by Noteholders
may be embodied in and evidenced by one or more instruments of substantially
similar tenor signed by such Noteholders in person or by agents duly appointed
in writing; and except as herein otherwise expressly provided such action shall
become effective when such instrument or instruments are delivered to the
Indenture Trustee, and, where it is hereby expressly required, to the Issuer.
Such instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Noteholders
signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Indenture and (subject to Section 6.01) conclusive in favor of
the Indenture Trustee and the Issuer, if made in the manner provided in this
Section.
(b) The fact and date of the execution by any person of any such instrument
or writing may be proved in any manner that the Indenture Trustee deems
sufficient.
(c) The ownership of Notes shall be proved by the Note Register.
(d) Any request, demand, authorization, direction, notice, consent, waiver
or other action by the Holder of any Notes shall bind the Holder of every Note
issued upon the registration thereof or in exchange therefor or in lieu thereof,
in respect of anything done, omitted or suffered to be done by the Indenture
Trustee or the Issuer in reliance thereon, whether or not notation of such
action is made upon such Note.
SECTION 13.4 Notices, etc. to Indenture Trustee, the Issuer and Rating
Agencies. Any request, demand, authorization, direction, notice, consent, waiver
or Act of Noteholders or other documents provided or permitted by this Indenture
shall be in writing and if such request, demand, authorization, direction,
notice, consent, waiver or act of Noteholders is to be made upon, given or
furnished to or filed with:
(a) the Indenture Trustee by any Noteholder or by the Issuer shall be
sufficient for every purpose hereunder if made, given, furnished or filed in
writing to or with the Indenture Trustee at its Corporate Trust Office, or
(b) the Issuer by the Indenture Trustee or by any Noteholder shall be
sufficient for every purpose hereunder if in writing and mailed first-class,
postage prepaid to the Issuer addressed to: Luminent Mortgage Trust 200_-__, in
care of [o], or at any other address previously furnished in writing to the
Indenture Trustee by the Issuer. The Issuer shall promptly transmit any notice
received by it from the Noteholders to the Indenture Trustee.
(c) Any notice required to be given to the Seller or [o] pursuant to
Section 6.07 shall be sufficient for every purpose hereunder if in writing and
delivered by first-class mail, postage
92
prepaid, overnight courier or facsimile to such parties addressed to the Seller
at [o]; or to [o] at [o].
Notices required to be given to the Rating Agencies by the Issuer, the
Indenture Trustee or the Owner Trustee shall be in writing, personally delivered
or mailed by certified mail, return receipt requested by overnight courier or
facsimile. Where this Indenture provides for notice to the Rating Agencies,
failure to give such notice shall not affect any other rights or obligations
created hereunder and shall not constitute a Default or Event of Default.
SECTION 13.5 Notices to Noteholders; Waiver. Where this Indenture provides
for notice to Noteholders of any event, such notice shall be sufficiently given
(unless otherwise herein expressly provided) if in writing and delivered by
first-class mail, postage prepaid, overnight courier or facsimile to each
Noteholder affected by such event, at his address as it appears on the Note
Register, not later than the latest date, and not earlier than the earliest
date, prescribed for the giving of such notice. In any case where notice to
Noteholders is given by mail, neither the failure to mail such notice nor any
defect in any notice so mailed to any particular Noteholder shall affect the
sufficiency of such notice with respect to other Noteholders, and any notice
that is mailed in the manner herein provided shall conclusively be presumed to
have been duly given.
Where this Indenture provides for notice in any manner, such notice may be
waived in writing by any Person entitled to receive such notice, either before
or after the event, and such waiver shall be the equivalent of such notice.
Waivers of notice by Noteholders shall be filed with the Indenture Trustee but
such filing shall not be a condition precedent to the validity of any action
taken in reliance upon such a waiver.
In case, by reason of the suspension of regular mail service as a result of
a strike, work stoppage or similar activity, it shall be impractical to mail
notice of any event to Noteholders when such notice is required to be given
pursuant to any provision of this Indenture, then any manner of giving such
notice as shall be satisfactory to the Indenture Trustee shall be deemed to be a
sufficient giving of such notice.
SECTION 13.6 Conflict with Trust Indenture Act. If any provision hereof
limits, qualifies or conflicts with another provision hereof that is required to
be included in this Indenture by any of the provisions of the Trust Indenture
Act, such required provision shall control.
The provisions of TIA Sections 310 through 317 that impose duties on any
person (including the provisions automatically deemed included herein unless
expressly excluded by this Indenture) are a part of and govern this Indenture,
whether or not physically contained herein.
SECTION 13.7 Effect of Headings and Table of Contents. The Article and
Section headings herein and the Table of Contents are for convenience only and
shall not affect the construction hereof.
SECTION 13.8 Successors and Assigns. All covenants and agreements in this
Indenture and the Notes by the Issuer shall bind its successors and assigns,
whether so expressed
93
or not. All agreements of the Indenture Trustee in this Indenture shall bind its
successors, co-Indenture Trustees and agents.
SECTION 13.9 Severability. In case any provision in this Indenture or in
the Notes shall be invalid, illegal or unenforceable, the validity, legality,
and enforceability of the remaining provisions shall not in any way be affected
or impaired thereby.
SECTION 13.10 Benefits of Indenture and Consent of Noteholders. Nothing in
this Indenture or in the Notes, express or implied, shall give to any Person,
other than the parties hereto and their successors hereunder, and the
Noteholders, and any other party secured hereunder, and any other Person with an
ownership interest in any part of the Collateral, any benefit or any legal or
equitable right, remedy or claim under this Indenture. Each Noteholder and Note
Owner, by acceptance of a Note or, in the case of a Note Owner, a beneficial
interest in a Note, consents to and agrees to be bound by the terms and
conditions of this Indenture.
SECTION 13.11 Legal Holidays. In any case where the date on which any
payment is due shall not be a Business Day, then (notwithstanding any other
provision of the Notes or this Indenture) payment need not be made on such date,
but may be made on the next succeeding Business Day with the same force and
effect as if made on the date on which nominally due, and no interest shall
accrue for the period from and after any such nominal date.
SECTION 13.12 Governing Law. THIS INDENTURE SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, AND TO THE
EXTENT PERMITTED BY LAW, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS,
AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.
SECTION 13.13 Counterparts. This Indenture may be executed in any number of
counterparts, each of which so executed shall be deemed to be an original, but
all such counterparts shall together constitute but one and the same instrument.
SECTION 13.14 Recording of Indenture. If this Indenture is subject to
recording in any appropriate public recording offices, such recording is to be
effected by the Issuer and at its expense accompanied by an Opinion of Counsel
at its expense (which may be counsel to the Indenture Trustee or any other
counsel reasonably acceptable to the Indenture Trustee) to the effect that such
recording is necessary either for the protection of the Noteholders or any other
Person secured hereunder or for the enforcement of any right or remedy granted
to the Indenture Trustee under this Indenture.
SECTION 13.15 Issuer Obligations. No recourse may be taken, directly or
indirectly, with respect to the obligations of the Issuer, the Owner Trustee or
the Indenture Trustee on the Notes or under this Indenture or any certificate or
other writing delivered in connection herewith or therewith, against (i) the
Indenture Trustee or the Owner Trustee in its individual capacity, (ii) any
owner of a beneficial interest in the Issuer or (iii) any partner, owner,
beneficiary, agent, officer, director, employee or agent of the Indenture
Trustee or the Owner Trustee in its individual capacity, any holder of a
beneficial interest in the Issuer, the Owner
94
Trustee or the Indenture Trustee or of any successor or assign of the Indenture
Trustee or the Owner Trustee in its individual capacity, except as any such
Person may have expressly agreed (it being understood that the Indenture Trustee
and the Owner Trustee have no such obligations in their individual capacity) and
except that any such partner, owner or beneficiary shall be fully liable, to the
extent provided by applicable law, for any unpaid consideration for stock,
unpaid capital contribution or failure to pay any installment or call owing to
such entity. For all purposes of this Indenture, in the performance of any
duties or obligations of the Issuer hereunder, the Owner Trustee shall be
subject to, and entitled to the benefits of, the terms and provisions of Article
VI, VII and VIII of the Trust Agreement.
SECTION 13.16 No Petition. The Indenture Trustee, by entering into this
Indenture, and each Noteholder, by its acceptance of a Note, hereby covenant and
agree that they will not at any time institute against the Seller, the Depositor
or the Issuer or join in any institution against the Seller, the Depositor or
the Issuer, any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceedings, or other proceedings under any United States federal or
state bankruptcy or similar law in connection with any obligations relating to
the Notes, this Indenture or any of the other Operative Agreements.
SECTION 13.17 Inspection. The Issuer agrees that, on reasonable prior
notice, it will permit any representative of the Indenture Trustee during the
Issuer's normal business hours, to examine all the books of account, records,
reports and other papers of the Issuer, to make copies and extracts therefrom,
to cause such books to be audited by Independent certified public accountants,
and to discuss the Issuer's affairs, finances and accounts with the Issuer's
officers, employees, and Independent certified public accountants, all at such
reasonable times and as often as may be reasonably requested. The Indenture
Trustee shall and shall cause its representatives to hold in confidence all such
information except to the extent disclosure may be required by law (and all
reasonable applications for confidential treatment are unavailing) and except to
the extent that the Indenture Trustee may reasonably determine that such
disclosure is consistent with its obligations hereunder.
SECTION 13.18 Execution by the Issuer. It is expressly understood and
agreed by the parties hereto that (a) this Indenture is executed and delivered
by [o], not individually or personally but solely as Owner Trustee of the
Issuer, in the exercise of the powers and authority conferred and vested in its
as Indenture Trustee, (b) each of the representations, undertaking and
agreements herein made on the part of the Issuer is made and intended not as
personal representations, undertakings and agreements by [o] but is made and
intended for the purpose of binding only the Issuer, (c) nothing herein
contained shall be construed as creating any liability on [o], individually or
personally, to perform any covenant either expressed or implied contained
herein, all such liability, if any, being expressly waived by the parties and by
any person claiming by, through or under the parties hereto and (d) under no
circumstances shall [o] be personally liable for the payment of any indebtedness
or expenses of the Issuer or be liable for the breach or failure of any
obligation, representations, warranty or covenant made or undertaken by the
Issuer under this Indenture or any other document.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
95
IN WITNESS WHEREOF, the Issuer, the Master Indenture Trustee and the
Indenture Trustee have caused this Indenture to be duly executed by their
respective officers, thereunto duly authorized and duly attested, all as of the
day and year first above written.
LUMINENT MORTGAGE TRUST 200_-_, as
Issuer
By: [o],
not in its individual capacity but
solely as Owner Trustee
By:
--------------------------------
Name:
Title:
[o],
as Master Servicer
By:
--------------------------------
Name:
Title:
[o],
as Indenture Trustee
By:
--------------------------------
Name:
Title:
[INDENTURE]
EXHIBIT A-1
FORM OF NOTE
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO ISSUER OR ITS AGENT
FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THIS NOTE DOES NOT EVIDENCE AN OBLIGATION OF OR AN INTEREST IN, AND IS NOT
GUARANTEED BY, THE DEPOSITOR, THE MASTER SERVICER, THE INDENTURE TRUSTEE, THE
OWNER TRUSTEE, OR ANY AFFILIATE OF ANY OF THEM AND IS NOT INSURED OR GUARANTEED
BY ANY GOVERNMENTAL AGENCY OR PRIVATE INSURER.
THE PRINCIPAL OF THIS NOTE IS PAYABLE IN INSTALLMENTS AS SET FORTH HEREIN.
ACCORDINGLY, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS NOTE AT ANY TIME MAY BE
LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF.
EACH PURCHASER OR PROPOSED TRANSFEREE OF A NOTE MUST REPRESENT TO THE
INDENTURE TRUSTEE EITHER (A) THAT IT IS NOT, AND IS NOT PURCHASING THE NOTES
WITH ASSETS OF, AN EMPLOYEE BENEFIT PLAN SUBJECT TO TITLE I OF THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR A PLAN SUBJECT
TO SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"),
OR A GOVERNMENTAL PLAN OR CHURCH PLAN THAT IS SUBJECT TO ANY PROVISIONS OF
APPLICABLE FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW") SUBSTANTIALLY SIMILAR TO
THE FOREGOING PROVISIONS OF ERISA OR THE CODE, OR (B) THAT ITS ACQUISITION AND
HOLDING OF THE NOTES WILL NOT CONSTITUTE OR RESULT IN A NONEXEMPT PROHIBITED
TRANSACTION UNDER ERISA OR THE CODE OR SIMILAR LAW AND WILL NOT SUBJECT THE
ISSUER, THE INDENTURE TRUSTEE, THE OWNER TRUSTEE OR MASTER SERVICER TO ANY
OBLIGATION IN ADDITION TO THOSE UNDERTAKEN IN THE INDENTURE.
A-1-1
LUMINENT MORTGAGE TRUST 200_-__,
MORTGAGE-BACKED NOTES
Aggregate Original Principal Amount Original Principal Amount of this Note:
of the
Notes: _____________________________ ________________________________________
INTEREST RATE: Adjustable CUSIP: _________________________________
Number ______________________________
Luminent Mortgage Trust 200_-_, a statutory business trust organized and
existing under the laws of the State of Delaware (herein referred to as the
"Issuer"), for value received, hereby promises to pay to CEDE & CO., or
registered assigns, the principal sum of ___________________ DOLLARS AND NO/100
($ ) payable on each Distribution Date in an amount equal to the result obtained
by multiplying (A) a fraction the numerator of which is $___________________ and
the denominator of which is the aggregate original principal amount of all Notes
issued on the Closing Date, by (B) the aggregate amount, if any, payable from
the Distribution Account in respect of principal on the Notes pursuant to
Section [__] of the Indenture, dated as of [o], between the Issuer and [o], a
[o] as Indenture Trustee (the "Indenture Trustee"); provided, however, that the
entire unpaid principal amount of this Note shall be due and payable on the
Distribution Date occurring in [o] (the "Maturity Date") or as otherwise
specified in the Indenture. Capitalized terms used but not defined herein are
defined in the Indenture, which also contains rules as to construction that
shall be applicable herein.
The Issuer will pay interest on this Note at a per annum rate equal to the
Note Interest Rate, on the principal amount of this Note outstanding on the
immediately preceding Distribution Date (after giving effect to all payments of
principal made on such preceding Distribution Date) on each Distribution Date
until the principal of this Note is paid or made available for payment in full.
Interest on this Note will accrue for each Distribution Date during the
period beginning on the immediately preceding Distribution Date (or [o], in the
case of the first Accrual Period) and ending on the day immediately preceding
the related Distribution Date (each, an "Accrual Period"). Interest will be
computed on the basis of a 360-day year and the actual number of days elapsed
during the related Accrual Period. Such principal of and interest on this Note
shall be paid in the manner specified on the reverse hereof.
The principal of and interest on this Note are payable in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts. All payments made by the Issuer
with respect to this Note shall be applied first to interest due and payable on
this Note as provided above and then to the unpaid principal of this Note.
Reference is made to the further provisions of this Note set forth on the
reverse hereof, which shall have the same effect as though fully set forth on
the face of this Note.
A-1-2
Unless the certificate of authentication hereon has been executed by the
Indenture Trustee whose name appears below by manual signature, this Note shall
not be entitled to any benefit under the Indenture referred to on the reverse
hereof, or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Issuer has caused this instrument to be signed,
manually or in facsimile, by its Authorized Officer, as of the date set forth
below.
LUMINENT MORTGAGE TRUST 200_-__
By: [o],
not in its individual capacity but
solely as Owner Trustee under the
Trust Agreement
By:
------------------------------------
Authorized Signatory
Dated: [o]
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Notes designated above and referred to in the
within-mentioned Indenture.
[o],
not in its individual capacity but
solely as Indenture Trustee,
By:
------------------------------------
Authorized Signatory
Dated: [o]
A-1-3
LUMINENT MORTGAGE TRUST 200_-_
This Note is one of a duly authorized issue of Notes of the Issuer, all
issued under the Indenture, to which Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective rights and
obligations thereunder of the Issuer, the Indenture Trustee and the Holders of
the Notes. To the extent that any provision of this Note contradicts or is
inconsistent with the provisions of the Indenture, the provisions of the
Indenture shall control and supersede such contradictory or inconsistent
provision herein. This Note is subject to all terms of the Indenture.
Principal of this Note will be payable on each Distribution Date in an
amount described on the face hereof. "Distribution Date" means the [o] day of
each month or, if any such date is not a Business Day, the next succeeding
Business Day, commencing in [o].
Payments of interest on this Note due and payable on each Distribution
Date, together with the installment of principal, if any, to the extent not in
full payment of this Note, shall be made by check mailed to the Person whose
name appears as the Registered Holder of this Note (or one or more Predecessor
Notes) on the Note Register as of the close of business on each Record Date, or,
upon written request made to the Indenture Trustee at least five Business Days
prior to the related Record Date by the Holder of a Note having an initial Note
Principal Amount of not less than $[2,500,000], by wire transfer in immediately
available funds to an account specified in the request and at the expense of
such Noteholder, except that, unless Definitive Notes have been issued pursuant
to Section [__] of the Indenture, with respect to Notes registered on the Record
Date in the name of the nominee of the Clearing Agency (initially, such nominee
to be Cede & Co.), payment will be made by wire transfer in immediately
available funds to the account designated by such nominee, except for the final
installment of principal payable with respect to this Note on the Maturity Date,
which shall be payable as provided in the Indenture. Checks shall be mailed to
the Person entitled thereto at the address of such Person as it appears on the
Note Register as of the applicable Record Date without requiring that this Note
be submitted for notation of payment. Any reduction in the principal amount of
this Note (or any one or more Predecessor Notes) effected by any payments made
on any Distribution Date shall be binding upon all future Holders of this Note
and of any Note issued upon the registration of transfer hereof or in exchange
hereof or in lieu hereof, whether or not noted hereon. If funds are expected to
be available, as provided in the Indenture, for payment in full of the then
remaining unpaid principal amount of this Note on a Distribution Date, then the
Person who was the Registered Holder hereof as of the Record Date preceding such
Distribution Date shall be notified by the Indenture Trustee, in the name of and
on behalf of the Issuer. Such notice shall be mailed or transmitted by facsimile
prior to such Distribution Date, and the amount then due and payable shall be
payable only upon presentation and surrender of this Note at the Indenture
Trustee's principal Corporate Trust Office.
As provided in the Indenture and subject to certain limitations set forth
therein, the transfer of this Note may be registered on the Note Register upon
surrender of this Note for registration of transfer at the office or agency
designated by the Issuer pursuant to the Indenture, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Indenture Trustee duly executed by, the Holder hereof or such Holder's attorney
duly authorized in writing, with such signature guaranteed by an "eligible
guarantor institution" meeting the
A-1-4
requirements of the Note Registrar, which requirements include membership or
participation in the Securities Transfer Agent's Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by the Note
Registrar in addition to, or in substitution for, STAMP, all in accordance with
the Securities Exchange Act of 1934, as amended, and thereupon one or more new
Notes of authorized denominations and in the same aggregate principal amount
will be issued to the designated transferee or transferees. No service charge
will be charged for any registration of transfer or exchange of this Note, but
the transferor may be required to pay a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any such registration
of transfer or exchange.
Each Noteholder and Note Owner, by acceptance of a Note or, in the case of
a Note Owner, a beneficial interest in a Note, covenants and agrees that no
recourse may be taken, directly or indirectly, with respect to the obligations
of the Issuer, the Owner Trustee or the Indenture Trustee on the Notes or under
the Indenture or any certificate or other writing delivered in connection
therewith, against (i) the Indenture Trustee or the Owner Trustee in its
individual capacity, (ii) any owner of a beneficial interest in the Issuer or
(iii) any partner, owner, beneficiary, agent, officer, director or employee of
the Indenture Trustee or the Owner Trustee in its individual capacity, any
holder of a beneficial interest in the Issuer, the Owner Trustee or the
Indenture Trustee or of any successor or assign of the Indenture Trustee or the
Owner Trustee in its individual capacity, except as any such Person may have
expressly agreed and except that any such partner, owner or beneficiary shall be
fully liable, to the extent provided by applicable law, for any unpaid
consideration for stock, unpaid capital contribution or failure to pay any
installment or call owing to such entity.
Each Noteholder and Note Owner, by acceptance of a Note or, in the case of
a Note Owner, a beneficial interest in a Note, covenants and agrees by accepting
the benefits of the Indenture that such Noteholder or Note Owner will not at any
time institute against the Seller, the Depositor or the Issuer, or join in any
institution against the Seller, the Depositor or the Issuer of, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings under any
United States federal or state bankruptcy or similar law in connection with any
obligations relating to the Notes, the Indenture or the other Operative
Agreements.
Each Noteholder and Note Owner, by acceptance of a Note or, in the case of
a Note Owner, a beneficial interest in a Note, consents to and agrees to be
bound by the terms and conditions of the Indenture.
The Issuer has entered into the Indenture and this Note is issued with the
intention that, for federal, state and local income, single business and
franchise tax purposes, the Notes will qualify as indebtedness of the Issuer
secured by the Collateral. Each Noteholder, by acceptance of a Note (and each
Note Owner by acceptance of a beneficial interest in a Note), agrees to treat
the Notes for all federal, state and local income tax purposes as indebtedness
of the Issuer.
Prior to the due presentment for registration of transfer of this Note, the
Issuer, the Indenture Trustee and any agent of the Issuer or the Indenture
Trustee may treat the Person in whose name this Note (as of the day of
determination or as of such other date as may be specified in the Indenture) is
registered as the owner hereof for all purposes, whether or not this
A-1-5
Note be overdue, and none of the Issuer, the Indenture Trustee or any such agent
shall be affected by notice to the contrary.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Issuer and the rights of the Holders of the Notes under the Indenture at any
time by the Issuer with the consent of the Holders of Notes representing a
majority of the Outstanding Amount of all Notes at the time Outstanding. The
Indenture also contains provisions permitting the Holders of not less than
66-2/3% of the Outstanding Amount of Notes, to waive compliance by the Issuer
with certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Holder of
this Note (or any one or more Predecessor Notes) shall be conclusive and binding
upon such Holder and upon all future Holders of this Note and of any Note issued
upon the registration of transfer hereof or in exchange hereof or in lieu hereof
whether or not notation of such consent or waiver is made upon this Note. The
Indenture also permits the amendment thereof, in certain limited circumstances,
or the waiver of certain terms and conditions set forth in the Indenture,
without the consent of Holders of the Notes issued thereunder.
The term "Issuer" as used in this Note includes any successor to the Issuer
under the Indenture.
The Notes are issuable only in registered form in denominations as provided
in the Indenture, subject to certain limitations therein set forth.
THIS NOTE AND THE INDENTURE SHALL BE GOVERNED BY AND, CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER AND THEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH
LAWS.
No reference herein to the Indenture and no provision of this Note or of
the Indenture shall alter or impair the obligation of the Issuer, which is
absolute and unconditional, to pay the principal of and interest on this Note at
the times, place and rate, and in the coin or currency herein prescribed.
Anything herein to the contrary notwithstanding, except as expressly
provided in the Operative Agreements, none of the Issuer in its individual
capacity, the Owner Trustee in its individual capacity, the Indenture Trustee in
its individual capacity, any owner of a beneficial interest in the Issuer, or
any of their respective partners, beneficiaries, agents, officers, directors,
employees or successors or assigns shall be personally liable for, nor shall
recourse be had to any of them for, the payment of principal of or interest on
this Note or performance of, or omission to perform, any of the covenants,
obligations or indemnifications contained in the Indenture. The Holder of this
Note by its acceptance hereof agrees that, except as expressly provided in the
Operative Agreements, in the case of an Event of Default under the Indenture,
the Holder shall have no claim against any of the foregoing for any deficiency,
loss or claim therefrom; provided, however, that nothing contained herein shall
be taken to prevent recourse to, and enforcement
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against, the assets of the Issuer for any and all liabilities, obligations and
undertakings contained in the Indenture or in this Note.
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ASSIGNMENT
Social Security or taxpayer I.D. or other identifying number of assignee:
_______________________
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto:
________________________________________________________________________________
(name and address of assignee)
the within Note and all rights thereunder, and hereby irrevocably constitutes
and appoints ________________________, attorney, to transfer said Note on the
books kept for registration thereof, with full power of substitution in the
premises.
Dated: ____________________________*/
Signature Guaranteed:
___________________________________*/
*/ NOTICE: The signature to this assignment must correspond with the name of the
registered owner as it appears on the face of the within Note in every
particular, without alteration, enlargement or any change whatever. Such
signature must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Note Registrar, which requirements include membership or
participation in STAMP or such other "signature guarantee program" as may be
determined by the Note Registrar in addition to, or in substitution for, STAMP,
all in accordance with the Securities Exchange Act of 1934, as amended.
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