MORGAN STANLEY ABS CAPITAL I INC. TRUST 2006-WMC2 AMENDMENT NO. 1 TO POOLING AND SERVICING AGREEMENT Dated as of November 7, 2006 Morgan Stanley ABS Capital I Inc. Trust 2006-WMC2 Mortgage Pass-Through Certificates, Series 2006-WMC2
XXXXXX
XXXXXXX ABS CAPITAL I INC. TRUST 2006-WMC2
_____________________
AMENDMENT
NO. 1 TO POOLING AND SERVICING AGREEMENT
Dated
as
of November 7, 2006
_________________________
Xxxxxx
Xxxxxxx ABS Capital I Inc. Trust 2006-WMC2
Mortgage
Pass-Through Certificates, Series 2006-WMC2
AMENDMENT
NO. 1
AMENDMENT
NO. 1 (this “Amendment”) effective as of June 1, 2006, among Xxxxxx Xxxxxxx ABS
Capital I Inc., as depositor (the “Depositor”), Xxxxx Fargo Bank, N.A., as
servicer (the “Servicer”), as securities administrator (the “Securities
Administrator”) and as custodian (the “Custodian”), WMC Mortgage Corp., as
responsible party (the “Responsible Party”), and Deutsche Bank National Trust
Company, as trustee (the “Trustee”).
PRELIMINARY
STATEMENT
WHEREAS,
the Depositor, the Servicer, the Securities Administrator, the Custodian, the
Responsible Party and the Trustee, are parties to the Pooling and Servicing
Agreement, dated as of June 1, 2006 (the “Agreement”);
WHEREAS,
Section 11.01 of the Agreement provides that the Agreement may be amended by
the
Depositor, the Servicer, the Securities Administrator, the Custodian, the
Responsible Party and the Trustee; and
NOW,
THEREFORE, in consideration of the foregoing and of other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged,
the
parties hereto agree as follows:
1. Capitalized
terms used but not defined herein shall have the meanings ascribed to such
terms
in the Agreement.
2. Amendments:
(a)
In
consideration of the mutual agreements herein contained, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree to amend
the Agreement as provided in Exhibit A, attached hereto. Language appearing
double underlined on Exhibit A will be added to the Agreement and language
appearing in strikethrough will be removed from the Agreement; and
(b)
The
following provision shall be added to the end of Schedule III to the
Agreement:
|
(71)
|
Each
Prepayment Charge is permissible and enforceable in accordance with
its
terms upon the Mortgagor's full and voluntary Principal Prepayment
(except
to the extent that: (1) the enforceability thereof may be limited
by
bankruptcy, insolvency, moratorium, receivership and other similar
laws
relating to creditors' rights generally; (2) the collectability thereof
may be limited due to acceleration in connection with a foreclosure
or
other involuntary prepayment; or (3) subsequent changes in applicable
law
may limit or prohibit enforceability thereof) under applicable
law.
|
3. Except
as
expressly modified or amended in this Amendment, all of the terms, covenants,
provisions, agreements and conditions of the Agreement are hereby ratified
and
confirmed in every respect and shall remain unmodified and unchanged and shall
continue in full force and effect.
4. The
Depositor certifies that all conditions for the execution of this Amendment
have
been satisfied.
5. This
Amendment shall become effective as of the date hereof when, and only when,
the
Agent shall have received executed counterparts of this Amendment from the
parties hereto.
6. This
Amendment may be executed in counterparts, each of which shall be an original
but all of which, taken together, shall constitute one and the same instrument.
This Amendment shall be construed in accordance with the laws of the State
of
New York (excluding provisions regarding conflicts of laws) and the obligations,
rights and remedies of the parties hereunder shall be determined in accordance
with such laws.
IN
WITNESS WHEREOF, the parties have duly executed this Amendment No. 1 as of
the
date first above written.
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XXXXXX
XXXXXXX ABS CAPITAL I INC.,
as
Depositor
|
|||||||||||||
|
By:
|
/s/
Xxxxxx Xxxxxxx
|
||||||||||||
|
Name:
|
Xxxxxx
Xxxxxxx
|
||||||||||||
|
Title:
|
Managing
Director
|
||||||||||||
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WMC
MORTGAGE CORP., as Responsible Party
|
|||||||||||||
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By:
|
/s/
Xxxxx Xxxxxxxx
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||||||||||||
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Name:
|
Xxxxx
Xxxxxxxx
|
||||||||||||
|
Title:
|
Senior
Vice President
|
||||||||||||
|
XXXXX
FARGO BANK, N.A., as Securities Administrator
|
|||||||||||||
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By:
|
/s/
Xxxxx Xxxxxxxx
|
||||||||||||
|
Name:
|
Xxxxx
Xxxxxxxx
|
||||||||||||
|
Title:
|
Vice
President
|
||||||||||||
|
XXXXX
FARGO BANK, N.A., as Servicer
|
|||||||||||||
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By:
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/s/
Xxxxxx XxXxxxxx
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||||||||||||
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Name:
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Xxxxxx
XxXxxxxx
|
||||||||||||
|
Title:
|
Vice
President
|
||||||||||||
|
XXXXX
FARGO BANK, N.A., as Custodian
|
|||||||||||||
|
By:
|
/s/
Xxxxxxx X. Gorren
|
||||||||||||
|
Name:
|
Xxxxxxx
X. Gorren
|
||||||||||||
|
Title:
|
Vice
President
|
||||||||||||
|
DEUTSCHE
BANK NATIONAL TRUST
COMPANY,
as Trustee
|
|||||||||||||
|
By:
|
/s/
Xxxxxxx Xxxxxxxx
|
||||||||||||
|
Name:
|
Xxxxxxx
Xxxxxxxx
|
||||||||||||
|
Title:
|
Vice
President
|
||||||||||||
|
By:
|
/s/
Xxxxxxx Xxxxx
|
||||||||||||
|
Name:
|
Xxxxxxx
Xxxxx
|
||||||||||||
|
Title:
|
Vice
President
|
||||||||||||
Exhibit
A
ARTICLE
X
TERMINATION
Section
10.01 Termination
upon Liquidation or Purchase of the Mortgage Loans
Section
10.02 Final
Distribution on the Certificates
Section
10.03 Additional
Termination Requirements
ARTICLE
XI
MISCELLANEOUS
PROVISIONS
Section
11.01 Amendment
Section
11.02 Recordation
of Agreement; Counterparts
Section
11.03 Governing
Law
Section
11.04 Intention
of Parties
Section
11.05 Notices
Section
11.06 Severability
of Provisions
Section
11.07
Assignment; Sales; Advance Facilities
Section
11.08 Limitation
on Rights of Certificateholders
Section
11.09
Inspection and Audit Rights
Section
11.10 Certificates
Nonassessable and Fully Paid
Section
11.11 Rule
of
Construction
Section
11.12 Waiver
of
Jury Trial
Section
11.13 Opinions
of Internal Counsel of WMC
Section
11.14
Rights of the Swap Provider
Section
11.15
Regulation AB Compliance; Intent of the Parties;
Reasonableness
SCHEDULES
|
Schedule
I
|
Mortgage
Loan Schedule
|
|
Schedule
II
|
Representations
and Warranties of Xxxxx Fargo Bank, N.A., as Servicer
|
|
Schedule
III
|
Representations
and Warranties of the Responsible Party as to the Mortgage
Loans
|
|
Schedule
IV
|
Representations
and Warranties of the Responsible Party as to the Responsible
Party
|
|
Schedule
V
|
Representations
and Warranties of Xxxxxx Xxxxxxx ABS Capital I Inc. as to the Mortgage
Loans
|
|
Schedule
VI
|
Representations
and Warranties of Xxxxx Fargo Bank, N.A., as Custodian
|
EXHIBITS
|
Exhibit
A
|
Form
of Class A, Class M and Class B Certificate
|
|
Exhibit
B
|
Form
of Class P Certificate
|
|
Exhibit
C
|
Form
of
|
|
Exhibit
D
|
Form
of Class X Certificate
|
REMIC
III
As
provided herein, the Securities Administrator, on behalf of the Trustee,
will
make an election to treat the segregated pool of assets consisting of the
REMIC
II Regular Interests as a REMIC for federal income tax purposes, and such
segregated pool of assets will be designated as “REMIC III”. The R-III Interest
will represent the sole class of “residual interests” in REMIC III for purposes
of the REMIC Provisions. The following table irrevocably sets forth the Class
designation, Pass-Through Rate and Initial Certificate Principal Balance
for
each Class of Certificates that represents one or more of the “regular
interests” in REMIC III created hereunder:
|
Class
Designation
|
Initial
Certificate
Principal
Balance
|
Pass-Through
Rate
|
Assumed
Final Distribution Date(1)
|
|||
|
Class
A-1
|
$
|
581,960,000.00
|
(2)
|
July
25, 2036
|
||
|
Class
A-2fpt
|
$
|
500,000,000.00
|
(2)
|
July
25, 2036
|
||
|
Class
A-2a
|
$
|
340,525,000.00
|
(2)
|
July
25, 2036
|
||
|
Class
A-2b
|
$
|
115,885,000.00
|
(2)
|
July
25, 2036
|
||
|
Class
A-2c
|
$
|
335,030,000.00
|
(2)
|
July
25, 2036
|
||
|
Class
A-2d
|
$
|
242,825,000.00
|
(2)
|
July
25, 2036
|
||
|
Class
M-1
|
$
|
89,803,000.00
|
(2)
|
July
25, 2036
|
||
|
Class
M-2
|
$
|
72,884,000.00
|
(2)
|
July
25, 2036
|
||
|
Class
M-3
|
$
|
45,552,000.00
|
(2)
|
July
25, 2036
|
||
|
Class
M-4
|
$
|
41,648,000.00
|
(2)
|
July
25, 2036
|
||
|
Class
M-5
|
$
|
40,346,000.00
|
(2)
|
July
25, 2036
|
||
|
Class
M-6
|
$
|
36,442,000.00
|
(2)
|
July
25, 2036
|
||
|
Class
B-1
|
$
|
35,140,000.00
|
(2)
|
July
25, 2036
|
||
|
Class
B-2
|
$
|
27,331,000.00
|
(2)
|
July
25, 2036
|
||
|
Class
B-3
|
$
|
26,030,000.00
|
(2)
|
July
25, 2036
|
||
|
Class
XInterest(3)
|
$
|
71,585,987.33
|
(2)
|
July
25, 2036
|
||
|
Class
PInterest
|
$
|
100.00
|
N/A(4)
|
July
25, 2036
|
||
|
Class
IO Interest
|
(5)
|
(6)
|
July
25, 2036
|
|||
|
(1)
|
For
purposes of Section 1.860G-1(a)(4)(iii) of the Treasury
regulations.
|
|||||
|
(2)
|
Calculated
in accordance with the definition of “Pass-Through Rate”
herein.
|
|||||
|
(3)
|
The
Class X
|
|||||
|
(4)
|
The
Class P
|
|||||
|
(5)
|
For
federal income tax purposes, the Class IO Interest will not have
a
Pass-Through Rate, but will be entitled to 100]% of the amounts
distributed on REMIC II Regular Interest LT-IO.
|
|||||
|
(6)
|
For
federal income tax purposes, the Class IO Interest will not have
an
Uncertificated Principal Balance, but will have a notional amount
equal to
the Uncertificated Notional Amount of REMIC II Regular Interest
IO.
|
|||||
REMIC
IV
As
provided herein, the Securities Administrator, on behalf of the Trustee
will
make an election to treat the segregated pool of assets consisting of the
Class
X Interest as a REMIC for federal income tax purposes, and such segregated
pool
of assets will be designated as “REMIC IV”. The R-IV Interest will represent the
sole class of “residual interests” in REMIC IV for purposes of the REMIC
Provisions. The following table irrevocably sets forth the Class designation,
Pass-Through Rate and Initial Certificate Principal Balance for each Class
of
Certificates that represents one or more of the “regular interests” in REMIC IV
created hereunder:
|
Class
Designation
|
Initial
Certificate
Principal
Balance
|
Pass-Through
Rate
|
Assumed
Final Distribution Date(1)
|
||
|
Class
X
|
$ 71,585,987.33
|
(2)
|
July
25, 2036
|
||
|
(1)
|
For
purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
the
Distribution Date in the second month following the maturity
date for the
Mortgage Loan with the latest maturity date has been designated
as the
“latest possible maturity date” for the Class X
Certificates.
|
||||
|
(2)
|
The
Class X Certificates will be entitled to 100% of amounts distributed
on
the Class X Interest.
|
||||
REMIC
V
As
provided herein, the Securities Administrator, on behalf of the Trustee
will
make an election to treat the segregated pool of assets consisting of the
Class
P Interest as a REMIC for federal income tax purposes, and such segregated
pool
of assets will be designated as “REMIC V”. The R-V Interest will represent the
sole class of “residual interests” in REMIC V for purposes of the REMIC
Provisions. The following table irrevocably sets forth the Class designation,
Pass-Through Rate and Initial Certificate Principal Balance for each Class
of
Certificates that represents one or more of the “regular interests” in REMIC V
created hereunder:
|
Class
Designation
|
Initial
Certificate
Principal
Balance
|
Pass-Through
Rate
|
Assumed
Final Distribution Date(1)
|
||
|
Class
P
|
$ 100
|
(2)
|
July
25, 2036
|
||
|
(1)
|
For
purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
the
Distribution Date in the second month following the maturity
date for the
Mortgage Loan with the latest maturity date has been designated
as the
“latest possible maturity date” for the Class P
Certificates.
|
||||
|
(2)
|
The
Class P Certificates will be entitled to 100% of amounts distributed
on
the Class P Interest.
|
||||
REMIC
VI
As
provided herein, the Securities Administrator, on behalf of the Trustee
will
make an election to treat the segregated pool of assets consisting of the
Class
IO Interest as a REMIC for federal income tax purposes, and such segregated
pool
of assets will be designated as “REMIC VI”. The R-VI Interest will represent the
sole class of “residual interests” in REMIC VI for purposes of the REMIC
Provisions. The following table irrevocably sets forth the Class designation,
Pass-Through Rate and Initial Certificate Principal Balance for each Class
of
Certificates that represents one or more of the “regular interests” in REMIC VI
created hereunder:
|
Class
Designation
|
Initial
Certificate
Principal
Balance
|
Pass-Through
Rate
|
Assumed
Final Distribution Date(1)
|
||
|
Swap-IO
|
$ (2)
|
(3)
|
July
25, 2036
|
||
|
(1)
|
For
purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
the
Distribution Date in the second month following the maturity
date for the
Mortgage Loan with the latest maturity date has been designated
as the
“latest possible maturity date” for the REMIC VI Regular Interest
Swap-IO.
|
||||
|
(2)
|
REMIC
VI Regular Interest Swap-IO will not have a Certificate Notional
Balance
but will be entitled to 100% of amounts distributed on the Class
IO
Interest.
|
||||
|
(3)
|
REMIC
VI Regular Interest Swap-IO will be entitled to 100% of amounts
distributed on the Class IO
Interest.
|
||||
The
minimum denomination for each Class of Certificates, other than the Class
P,
Class R,
Class R-X
and the
Class X Certificates, will be $25,000 with integral multiples of $1 in
excess
thereof. The minimum denomination for the Class P and the Class X Certificates
will each be a 1% Percentage Interest in such Class. The Class R Certificateand
Class R-XCertificates
will
represent a 100% Percentage Interest in such Class.
It
is
expected that each Class of Certificates will receive its final distribution
of
principal and interest on or prior to the Final Scheduled Distribution
Date.
Set
forth
below are designations of Classes of Certificates to the categories used
herein:
|
Book-Entry
Certificates
|
All
Classes of Certificates other than the Physical
Certificates.
|
|
Class
A Certificates
|
Class
A-1, Class A-2fpt, Class A-2a, Class A-2b, Class A-2c and Class
A-2d.
|
|
Delay
Certificates
|
None.
|
ERISA-Restricted
|
Certificates
|
|
|
Non-Delay
Certificates
|
Class
A, Class X and Subordinated
Certificates.
|
|
Offered
Certificates
|
All
Classes of Certificates other than the Private
Certificates.
|
|
Physical
Certificates
|
Class
P, Class X and
|
|
Private
Certificates
|
Class
P, Class X and
|
|
Rating
Agencies
|
Xxxxx’x,
Fitch and Standard & Poor’s.
|
|
Regular
Certificates
|
All
Classes of Certificates other than the Class P and
|
|
Residual
Certificates
|
Class
R
Certificates and Class R-X
Certificates.
|
|
Subordinated
Certificates
|
Class
M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class M-6, Class
B-1,
Class B-2 and Class B-3
Certificates.
|
minus
all
distributions of principal previously made with respect thereto and in
the case
of any Certificates, reduced by any Applied Realized Loss Amounts allocated
to
such Class of Certificates pursuant to Section 4.05; provided, however,
that
immediately following the Distribution Date on which a Subsequent Recovery
is
distributed, the Class Certificate Balances of any Class or Classes of
Certificates that have been previously reduced by Applied Realized Loss
Amounts
will be increased, in order of seniority, by the amount of the Subsequent
Recovery distributed on such Distribution Date (up to the amount of the
Unpaid
Realized Loss Amount for such Class or Classes for such Distribution Date).
With
respect to the Class X Certificates and any Distribution Date, the excess,
if
any, of (i) the then Stated Principal Balance of the Mortgage Loans over
(ii)
the then aggregate Certificate Balance of the Class A Certificates, Class
M
Certificates and the Class P Certificates. The Class
RResidual
Certificates have no Certificate Balance.
“Certificate
Owner”: With respect to a Book-Entry Certificate, the Person who is the
beneficial owner of such Book-Entry Certificate.
“Certificate
Register”: The register maintained pursuant to Section 5.02.
“Certificateholder”
or “Holder”: The person in whose name a Certificate is registered in the
Certificate Register, except that, solely for the purpose of giving any consent
pursuant to this Agreement, any Certificate registered in the name of the
Depositor or any Affiliate of the Depositor shall be deemed not to be
Outstanding and the Percentage Interest evidenced thereby shall not be taken
into account in determining whether the requisite amount of Percentage Interests
necessary to effect such consent has been obtained; provided, however, that
if
any such Person (including the Depositor) owns 100% of the Percentage Interests
evidenced by a Class of Certificates, such Certificates shall be deemed to
be
Outstanding for purposes of any provision hereof that requires the consent
of
the Holders of Certificates of a particular Class as a condition to the taking
of any action hereunder. The Securities Administrator is entitled to rely
conclusively on a certification of the Depositor or any Affiliate of the
Depositor in determining which Certificates are registered in the name of
an
Affiliate of the Depositor.
“Class”:
All Certificates bearing the same class designation as set forth in the
Preliminary Statement.
“Class
A Certificates”:
As
specified in the Preliminary Statement.
“Class
A
Certificate Group”: The Group I Class A Certificates or the Group II Class A
Certificates, as applicable.
“Class
A
Principal Allocation Percentage”: With respect to any Distribution Date, the
percentage equivalent of a fraction, determined as follows: (A) with respect
to
the Group I Class A Certificates, a fraction, the numerator of which is (x)
the
portion of the Principal Remittance Amount for such Distribution Date that
is
attributable to the principal received or advanced on the Group I Mortgage
Loans
and the denominator of which is (y) the Principal Remittance Amount for such
Distribution Date and (B) with respect to the Group II Class A Certificates,
a
fraction, the numerator of which is (x) the portion of the Principal Remittance
Amount for such Distribution Date that is attributable to the principal received
or advanced on
Certificates
(after taking into account the distribution of the Class M-1 Principal
Distribution Amount for such Distribution Date), (C) the Class Certificate
Balance of the Class M-2 Certificates (after taking into account the
distribution of the Class M-2 Principal Distribution Amount for such
Distribution Date), (D) the Class Certificate Balance of the Class M-3
Certificates (after taking into account the distribution of the Class M-3
Principal Distribution Amount for such Distribution Date), (E) the Class
Certificate Balance of the Class M-4 Certificates (after taking into account
the
distribution of the Class M-4 Principal Distribution Amount for such
Distribution Date) and (F) the Class Certificate Balance of the Class M-5
Certificates immediately prior to such Distribution Date over (ii) the lesser
of
(A) 84.90% of the aggregate Stated Principal Balance of the Mortgage Loans
for
such Distribution Date and (B) the excess, if any, of the aggregate Stated
Principal Balance of the Mortgage Loans for such Distribution Date over
$13,014,935.44.
“Class
M-6 Certificates”:
All
Certificates bearing the class designation of “Class M-6,” and evidencing (i) a
REMIC Regular Interest in REMIC III, (ii) the right to receive the related
Basis
Risk CarryForward Amount and (iii) the obligation to pay any Class IO
Distribution Amount.
“Class
M-6 Principal Distribution Amount”: With respect to any Distribution Date, the
excess of (i) the sum of (A) the aggregate Class Certificate Balances of
the
Class A Certificates (after taking into account the distribution of the Class
A
Principal Distribution Amount for such Distribution Date), (B) the Class
Certificate Balance of the Class M-1 Certificates (after taking into account
the
distribution of the Class M-1 Principal Distribution Amount for such
Distribution Date), (C) the Class Certificate Balance of the Class M-2
Certificates (after taking into account the distribution of the Class M-2
Principal Distribution Amount for such Distribution Date), (D) the Class
Certificate Balance of the Class M-3 Certificates (after taking into account
the
distribution of the Class M-3 Principal Distribution Amount for such
Distribution Date), (E) the Class Certificate Balance of the Class M-4
Certificates (after taking into account the distribution of the Class M-4
Principal Distribution Amount for such Distribution Date), (F) the Class
Certificate Balance of the Class M-5 Certificates (after taking into account
the
distribution of the Class M-5 Principal Distribution Amount for such
Distribution Date) and (G) the Class Certificate Balance of the Class M-6
Certificates immediately prior to such Distribution Date over (ii) the lesser
of
(A) 87.70% of the aggregate Stated Principal Balance of the Mortgage Loans
for
such Distribution Date and (B) the excess, if any, of the aggregate Stated
Principal Balance of the Mortgage Loans for such Distribution Date over
$13,014,935.44.
“Class
P
Certificates”: All Certificates bearing the class designation of “Class
P”.
“Class
P Interest”: An uncertificated interest in the Trust Fund held by the Trustee on
behalf of the Holders of the Class P Certificates, evidencing a Regular
Interest
in REMIC III for purposes of the REMIC Provisions.
“Class
R
Certificates”: All Certificates bearing the class designation of “Class R,” and
evidencing ownership of the Class R-I Interest, the Class R-II Interest and
the
Class R-III Interest.
“Class
R-X Certificates”: All Certificates bearing the class designation of “Class
R-X,” and evidencing the ownership of the Class R-IV Interest, the Class R-V
Interest and the Class R-VI Interest.
“Class
R-I Interest”: The uncertificated residual interest in REMIC I.
“Class
R-II Interest”: The uncertificated residual interest in REMIC II.
“Class
R-III Interest”: The uncertificated residual interest in REMIC III.
“Class
R-IV Interest”: The uncertificated residual interest in REMIC
IV.
“Class
R-V Interest”: The uncertificated residual interest in REMIC
V.
“Class
R-VI Interest”: The uncertificated residual interest in REMIC
VI.
“Class
X
Certificate”: All Certificates bearing the designation “Class X” and evidencing
(i) a REMIC Regular Interest in REMIC IIIIV,
(ii)
the obligation to pay Basis Risk Shortfall and (iii) the obligation to
pay any
Class IO Distribution Amount.
“Class
X
Distributable Amount”: On any Distribution Date, the sum of (i) as a
distribution in respect of interest, the amount of interest that has accrued
on
the Class X Interest and not applied as an Extra Principal Distribution Amount
on such Distribution Date, plus any such accrued interest remaining
undistributed from prior Distribution Dates, plus, without duplication (ii)
as a
distribution in respect of principal, any portion of the principal balance
of
the Class X Certificates which is distributable as a Subordination Reduction
Amount, minus (iii) any amounts paid from the Excess Reserve Fund Account
to pay
any Basis Risk CarryForward Amount or any Swap Termination Payment.
“Class
X Interest”: An uncertificated interest in the Trust Fund held by the Trustee on
behalf of the Holders of the Class X Certificates, evidencing a Regular
Interest
in REMIC III for purposes of the REMIC Provisions.
“Closing
Date”: June 28, 2006.
“Closing
Date Deposit Amount”: $4.19 deposited by the Depositor into the Distribution
Account on the Closing Date. $0.02 of the Closing Date Deposit Amount shall
be
attributable to interest in respect of the Group I Mortgage Loans and $2.72
of
the Closing Date Deposit Amount shall be attributable to principal in respect
of
the Group I Mortgage Loans. $0.01 of the Closing Date Deposit amount shall
be
attributable to interest in respect of the Group II Mortgage Loans and $1.47
of
the Closing Date Deposit Amount shall be attributable to principal in respect
of
the Group II Mortgage Loans.
“Code”:
The Internal Revenue Code of 1986, including any successor or amendatory
provisions.
“Collection
Account”: As defined in Section 3.10(a).
“LIBOR
Determination Date”: With respect to any Interest Accrual Period for the Offered
Certificates, the second London Business Day preceding the commencement of
such
Interest Accrual Period.
“Liquidated
Mortgage Loan”: With respect to any Distribution Date, a defaulted Mortgage Loan
(including any REO Property) which either (a) was liquidated in the calendar
month preceding the month of such Distribution Date and as to which the Servicer
has certified to the Securities Administrator 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, or (b) is a Second Lien
Mortgage Loan (1) that is delinquent 180 days or longer, (2) for which the
related first lien mortgage loan is not a Mortgage Loan, and (3) as to which
the
Servicer has certified to the Securities Administrator that it does not believe
there is a reasonable likelihood that any further net proceeds will be received
or recovered with respect to such Second Lien Mortgage Loan.
“Liquidation
Proceeds”: Cash received in connection with the liquidation of a Liquidated
Mortgage Loan, whether through a trustee’s sale, foreclosure sale or otherwise,
including any Subsequent Recoveries.
“Loan
Group”: The Group I Mortgage Loans or the Group II Mortgage Loans, as
applicable.
“Loan
Group Cap”: The Group I Loan Cap or the Group II Loan Cap, as
applicable.
“Loan-to-Value
Ratio” or “LTV”: With respect to any First Lien Mortgage Loan, the ratio
(expressed as a percentage) of the original outstanding principal amount
of the
First Lien Mortgage Loan as of the Cut-off Date (unless otherwise indicated),
to
the lesser of (a) the Appraised Value of the Mortgaged Property at origination,
and (b) if the First Lien Mortgage Loan was made to finance the acquisition
of
the related Mortgaged Property, the purchase price of the Mortgaged
Property.
“London
Business Day”: Any day on which dealings in deposits of United States dollars
are transacted in the London interbank market.
“Marker
Rate”: With respect to the Class A Certificates, Class M Certificates and Class
B
CertificatesX
Interest
and any
Distribution Date, a per annum rate equal to two (2) times the weighted
average
of the Uncertificated REMIC II Pass-Through Rates for REMIC II Regular
Interest
LT-A1, REMIC II Regular Interest LT-A2fpt, REMIC II Regular Interest LT-A2a,
REMIC II Regular Interest LT-A2b, REMIC II Regular Interest LT-A2c, REMIC
II
Regular Interest LT-A2d, REMIC II Regular Interest LT-M1, REMIC II Regular
Interest LT-M2, REMIC II Regular Interest LT-M3, REMIC II Regular Interest
LT-M4, REMIC II Regular Interest LT-M5, REMIC II Regular Interest LT-M6,
REMIC
II Regular Interest LT-B1, REMIC II Regular Interest LT-B2, REMIC II Regular
Interest LT-B3 and REMIC II Regular Interest LT-ZZ, with the per annum
rate on
each such REMIC II Regular Interest (other than REMIC II Regular Interest
LT-ZZ)
subject to a cap equal to the Pass-Through Rate on the Corresponding Certificate
for the purpose of this calculation; and with the per annum rate on REMIC
II
Regular
(xiii) the
Class
B-1 Certificates, the lesser of (i) LIBOR plus the applicable Pass-Through
Margin and (ii) the WAC Cap;
(xiv) the
Class
B-2 Certificates, the lesser of (i) LIBOR plus the applicable Pass-Through
Margin and (ii) the WAC Cap;
(xv) the
Class
B-3 Certificates, the lesser of (i) LIBOR plus the applicable Pass-Through
Margin and (ii) the WAC Cap; and
(xvi) the
Class
X CertificatesInterest,
a per
annum rate equal to the percentage equivalent of a fraction, the numerator
of
which is the sum of the amounts calculated pursuant to clauses (A) through
(R)
below, and the denominator of which is the aggregate Uncertificated Principal
Balance of REMIC II Regular Interest LT-AA, REMIC II Regular Interest LT-A1,
REMIC II Regular Interest LT-A2fpt, REMIC II Regular Interest LT-A2a, REMIC
II
Regular Interest LT-A2b, REMIC II Regular Interest LT-A2c, REMIC II Regular
Interest LT-A2d, REMIC II Regular Interest LT-M1, REMIC II Regular Interest
LT-M2, REMIC II Regular Interest LT-M3, REMIC II Regular Interest LT-M4,
REMIC
II Regular Interest LT-M5, REMIC II Regular Interest LT-M6, REMIC II Regular
Interest LT-B1, REMIC II Regular Interest LT-B2, REMIC II Regular Interest
LT-B3
and REMIC II Regular Interest LT-ZZ. For purposes of calculating the
Pass-Through Rate for the Class X CertificatesInterest,
the
numerator is equal to the sum of the following components:
(A) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-AA
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-AA;
(B) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-A1
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-A1;
(C) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest
LT-A2fpt, minus the Marker Rate, applied to an amount equal to the
Uncertificated Principal Balance of REMIC II Regular Interest
LT-A2fpt;
(D) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-A2a,
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-A2a;
(E) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-A2b,
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-A2b;
(F) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-A2c,
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-A2c;
(G) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-A2d,
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-A2d;
(H) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-M1
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-M1;
(I) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-M2
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-M2;
(J) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-M3
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-M3;
(K) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-M4
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-M4;
(L) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-M5
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-M5;
(M) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-M6
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-M6;
(N) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-B1
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-B1;
(O) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-B2
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-B2;
(P) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-B3
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-B3;
(Q) the
Uncertificated REMIC II Pass-Through Rate for REMIC II Regular Interest LT-ZZ
minus the Marker Rate, applied to an amount equal to the Uncertificated
Principal Balance of REMIC II Regular Interest LT-ZZ; and
(R) 100%
of
the interest on REMIC II Regular Interest LT-P.
(xvii) the
Class X Certificates, 100% of the interest distributable to the Class X
Interest, expressed as a per annum rate.
REMIC
II
Regular Interest LT-2SUB, REMIC II Regular Interest LT-2GRP and REMIC II
Regular
Interest LT-XX.
“REMIC
II
Regular Interest LT-ZZ Maximum Interest Deferral Amount”: With respect to any
Distribution Date, the excess of (i) accrued interest at the Uncertificated
REMIC II Pass-Through Rate applicable to REMIC II Regular Interest LT-ZZ
for
such Distribution Date on a balance equal to the Uncertificated Principal
Balance of REMIC II Regular Interest LT-ZZ minus the REMIC II
Overcollateralization Amount, in each case for such Distribution Date, over
(ii)
the Uncertificated Accrued Interest on REMIC II Regular Xxxxxxxx XX-X0, REMIC
II
Regular Interest LT-A2fpt, REMIC II Regular Interest LT-A2a, REMIC II Regular
Interest LT-A2b, REMIC II Regular Interest LT-A2c, REMIC II Regular Interest
LT-A2d, REMIC II Regular Interest LT-M1, REMIC II Regular Interest LT-M2,
REMIC
II Regular Interest LT-M3, REMIC II Regular Interest LT-M4, REMIC II Regular
Interest LT-M5, REMIC II Regular Interest LT-M6, REMIC II Regular Interest
LT-B1, REMIC II Regular Interest LT-B2 and REMIC II Regular Interest LT-B3
for
such Distribution Date, with the rate on each such REMIC II Regular Interest
subject to a cap equal to the related Pass-Through Rate.
“REMIC
II
Sub WAC Allocation Percentage”: 50% of any amount payable or loss attributable
from the Mortgage Loans, which shall be allocated to REMIC II Regular Interest
LT-1SUB, REMIC II Regular Interest LT-1GRP, REMIC II Regular Interest LT-2SUB,
REMIC II Regular Interest LT-2GRP and REMIC II Regular Interest
LT-XX.
“REMIC
II
Subordinated Balance Ratio”: The ratio among the Uncertificated Principal
Balances of each REMIC II Regular Interest ending with the designation “SUB”,
equal to the ratio between, with respect to each such REMIC II Regular Interest,
the excess of (x) the aggregate Stated Principal Balance of the Group I Mortgage
Loans and the Group II Mortgage Loans, as applicable, over (y) the current
Certificate Principal Balance of the related Senior Certificates.
“REMIC
II
Targeted Overcollateralization Amount”: 0.50% of the Targeted
Overcollateralization Amount.
“REMIC
III”: The
segregated pool of assets consisting of all of the REMIC II Regular Interests
conveyed in trust to the Trustee, for the benefit of the REMIC III
Certificateholders
pursuant to Section 2.07,,
and all
amounts deposited therein, with respect to which a separate REMIC election
is to
be made.
“REMIC
III
Certificate”: Any Regular Certificate or Class R Certificate.
“REMIC
III Certificateholder”: The Holder of any REMIC III Certificate.
“REMIC
III Regular Interest”: Any of the Class X Interest, Class P Interest, Class IO
Interest and any “regular interest” in REMIC III the ownership of which is
represented by a Senior Certificate or Subordinate
Certificate.
“REMIC
IV”: The segregated pool of assets consisting of all of the Class X Interest
conveyed in trust to the Trustee, for the benefit of the REMIC IV
Certificateholders and the Class R-X Certificateholders (in respect of
the Class
R-IV Regular Interest), and all amounts deposited therein, with respect
to which
a separate REMIC election is to be made.
“REMIC
V”: The segregated pool of assets consisting of the Class P Interest conveyed
in
trust to the Trustee, for the benefit of the Class P Certificateholders
and the
Class R-X Certificateholders (as holders of the Class R-V Regular Interest),
and
all amounts deposited therein, with respect to which a separate REMIC election
is to be made.
“REMIC
VI”: The segregated pool of assets consisting of all of the Class IO Interest
conveyed in trust to the Trustee, for the benefit of the Holders of REMIC
VI
Regular Interest IO and the Holders of the Class R-X Certificates (as holders
of
the Class R-VI Regular Interest), and all amounts deposited therein, with
respect to which a separate REMIC election is to be made.
“REMIC
Opinion”: Shall mean an Opinion of Counsel to the effect that the proposed
action will not have an adverse affect on any REMIC created
hereunder.
“REMIC
Provisions”: Provisions of the federal income tax law relating to real estate
mortgage investment conduits, which appear at Sections 860A through 860G
of
Subchapter M of Chapter 1 of the Code, and related provisions, and regulations
promulgated thereunder, as the foregoing may be in effect from time to time
as
well as provisions of applicable state laws.
“REMIC
Regular Interest”: Any REMIC I Regular Interest, REMIC II Regular Interest,
Class
X Interest, Class P Interest, Regular
Certificate or Class IO Interest.
“Remittance
Date”: With respect to any Distribution Date, the second Business Day
immediately preceding such Distribution Date.
“REO
Disposition”: The final sale by the Servicer of any REO Property.
“REO
Imputed Interest”: As to any REO Property, for any period, an amount equivalent
to interest (at the Mortgage Rate net of the Servicing Fee Rate that would
have
been applicable to the related Mortgage Loan had it been outstanding) on
the
unpaid principal balance of the Mortgage Loan as of the date of acquisition
thereof (as such balance is reduced pursuant to Section 3.17 by any income
from
the REO Property treated as a recovery of principal).
“REO
Mortgage Loan”: A Mortgage Loan where title to the related Mortgaged Property
has been obtained by the Servicer in the name of the Trustee on behalf of
the
Certificateholders.
“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.
“Replacement
Swap Provider Payment”:
Any
payments that have been received by the Supplemental Interest Trust as a
result
of entering into a replacement interest rate swap agreement following an
Additional Termination Event described in Part 1(h)(ii) of the Interest Rate
Swap Agreement.
for
notices to Standard & Poor’s shall be Standard & Poor’s, 00 Xxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Residential Mortgage Surveillance
Group - Xxxxxx Xxxxxxx ABS Capital I Inc. Trust 2006-WMC2, or such other
address
as Standard & Poor’s may hereafter furnish to the Depositor, the Securities
Administrator, the Trustee and the Servicer.
“Standard
& Poor’s Glossary”: The Standard & Poor’s LEVELS®
Glossary, as may be in effect from time to time.
“Startup
Day”: The Closing
DateStartup
Day for REMIC I, REMIC II and REMIC III shall be the Closing Date. The
Startup
Date for REMIC IV, REMIC V and REMIC VI shall be November
7, 2006.
“Stated
Principal Balance”: As to each Mortgage Loan and as of any date of
determination, (i) the principal balance of the Mortgage Loan at the Cut-off
Date after giving effect to payments of principal due on or before such date
(whether or not received), minus (ii) all amounts previously remitted to
the
Securities Administrator with respect to the related Mortgage Loan representing
payments or recoveries of principal including advances in respect of scheduled
payments of principal. For purposes of any Distribution Date, the Stated
Principal Balance of any Mortgage Loan will give effect to any scheduled
payments of principal received by the Servicer on or prior to the related
Determination Date or advanced by the Servicer for the related Remittance
Date
and any unscheduled principal payments and other unscheduled principal
collections received during the related Prepayment Period, and the Stated
Principal Balance of any Mortgage Loan that has prepaid in full or has become
a
Liquidated Mortgage Loan during the related Prepayment Period shall be
zero.
“Stepdown
Date”: The later to occur of (i) the earlier to occur of (a) the Distribution
Date in July 2009 and (b) the Distribution Date following the Distribution
Date
on which the aggregate Class Certificate Balances of the Class A Certificates
have been reduced to zero and (ii) the first Distribution Date on which the
Senior Enhancement Percentage (calculated for this purpose only after taking
into account payments of principal on the Mortgage Loans applied to reduce
the
Stated Principal Balances of the Mortgage Loans for the applicable Distribution
Date but prior to any allocation of the Principal Distribution Amount and
principal payments from the Swap Account to the Certificates on such
Distribution Date) is greater than or equal to the Senior Specified Enhancement
Percentage.
“Subcontractor”:
Any
third-party or Affiliated vendor, subcontractor or other Person utilized
by the
Servicer, a Subservicer, the Securities Administrator or the Custodian, as
applicable, that is not responsible for the overall servicing (as “servicing” is
commonly understood by participants in the mortgage-backed securities market)
of
Mortgage Loans but performs one or more discrete functions identified in
Item
1122(d) of Regulation AB with respect to Mortgage Loans.
“Subordinated
Amount”: With respect to any Distribution Date, the excess, if any, of (a) the
aggregate Stated Principal Balance of the Mortgage Loans for such Distribution
Date over (b) the aggregate of the Class Certificate Balances of the Offered
Certificates and the Class P Certificates as of such Distribution Date (after
giving effect to the payment of the Principal Remittance Amount on such
Certificates on such Distribution Date).
“Supplemental
Interest Trust Trustee”: The Securities Administrator, and its successors in
interest and, if a successor securities administrator is appointed hereunder,
such successor.
“Swap
Account”: As defined in Section 4.06.
“Swap
Assets”:
Collectively, the Swap Account, the Interest Rate Swap Agreement, the Class
IO
Interest and the right to receive Class IO Shortfalls, subject to the obligation
to pay amounts specified in Section 4.06.
“Swap
LIBOR”: With respect to any Distribution Date (and the related Interest Accrual
Period), the product of (i) USD-LIBOR-BBA (as used in the Interest Swap
Agreement), (ii) two, and (iii) the quotient of (a) the actual number of
days in
the Interest Accrual Period for the Offered Certificates divided by (b)
30.
“Swap
Payment Allocation”: For any Class of Certificates and any Distribution Date,
that Class’s pro
rata
share of
the Net Swap Receipts, if any, for that Distribution Date, based on the Class
Certificate Balances of the Classes of Certificates.
“Swap
Payment Rate”: For any Distribution Date, a fraction, the numerator of which is
any Net Swap Payment or Swap Termination Payment owed to the Swap Provider
for
such Distribution Date and the denominator of which is the aggregate Stated
Principal Balance of the Mortgage Loans at the beginning of the related Due
Period, multiplied by 12.
“Swap
Provider”: Xxxxxx Xxxxxxx Capital Services Inc., a Delaware corporation, and its
successors in interest.
“Swap
Termination Payment”:
Any
payment payable by the Supplemental Interest Trust or the Swap Provider upon
termination of the Interest Rate Swap Agreement as a result of an Event of
Default (as defined in the Interest Rate Swap Agreement) or a Termination
Event
(as defined in the Interest Rate Swap Agreement).
“Tax
Matters Person”:
The
Holder of the Class R Certificates designated as “tax matters person” of
each
Trust REMIC in the manner providedREMIC
I, REMIC II and REMIC III in the manner provided under Treasury Regulations
Section 1.860F-4(d) and Treasury Regulations Section 301.6231(a)(7)-1.
The
Holder of the Class R-X Certificates designated as “tax matters person” of REMIC
IV, REMIC V and REMIC VI in the manner provided
under
Treasury Regulations Section 1.860F-4(d) and Treasury Regulations Section
301.6231(a)(7)-1.
“Tax
Service Contract”: As defined in Section 3.09(a).
“Telerate
Page 3750”: The display page currently so designated on the Bridge Telerate
Service (or such other page as may replace that page on that service for
displaying comparable rates or prices).
“Total
Monthly Excess Spread”: As to any Distribution Date, an amount equal to the
excess if any, of (i) the interest on the Mortgage Loans received by the
Servicer on or prior to the related Determination Date (other than Prepayment
Interest Excesses) or advanced by the
Servicer
for the related Remittance Date (net of Expense Fees) over (ii) the sum of
(A)
the amounts payable to the Certificates pursuant to Section 4.02(a)(i) on
such
Distribution Date, (B) any Net Swap Payments to the Swap Provider and (C)
any
Swap Termination Payment (other than a Defaulted Swap Termination Payment
that
is not a Senior Defaulted Swap Termination Payment) to the Swap
Provider.
“Transfer”:
Any direct or indirect transfer or sale of any Ownership Interest in a Residual
Certificate.
“Transfer
Affidavit”: As defined in Section 5.02(c).
“Transferor
Certificate”: As defined in Section 5.02(b).
“Trigger
Event”: Either a Cumulative Loss Trigger Event or a Delinquency Trigger
Event.
“Trust”:
The express trust created hereunder in Section 2.01(c).
“Trust
Fund”: The corpus of the trust created hereunder consisting of (i) the Mortgage
Loans and all interest and principal with respect thereto received on or
after
the related Cut-off Date, other than such amounts which were due on the Mortgage
Loans on or prior to the related Cut-off Date; (ii) the Collection Account,
Excess Reserve Fund Account, the Distribution Account, and all amounts deposited
therein pursuant to the applicable provisions of this Agreement; (iii) property
that secured a Mortgage Loan and has been acquired by foreclosure, deed-in-lieu
of foreclosure or otherwise; (iv) the Closing Date Deposit Amount; (v) the
Interest Rate Swap Agreement; (vi) the Swap Assets; and (vii) all proceeds
of
the conversion, voluntary or involuntary, of any of the foregoing.
“Trust
REMIC”: Any of REMIC I, REMIC II,
REMIC III, REMIC IV, REMIC V
or REMIC
IIIVI.
“Trustee”:
Deutsche Bank National Trust Company, a national banking association, and
its
successors in interest and, if a successor trustee is appointed hereunder,
such
successor.
“Uncertificated
Accrued Interest”: With respect to each Uncertificated REMIC Regular Interest on
each Distribution Date, an amount equal to one month’s interest at the related
Uncertificated Pass-Through Rate on the Uncertificated Principal Balance
of such
REMIC Regular Interest. In each case, Uncertificated Accrued Interest will
be
reduced by any Prepayment Interest Shortfalls and shortfalls resulting from
application of the Relief Act (allocated to such REMIC Regular Interests
as set
forth in Section 8.14).
“Uncertificated
Notional Amount”: With respect to REMIC II Regular Interest LT-IO and each
Distribution Date listed below, the aggregate Uncertificated Principal Balance
of the REMIC 1 Regular Interests ending with the designation “A” listed below:
|
Distribution
Date
|
REMIC
1 Regular Interests
|
(S) to
the
Excess Reserve Fund Account, the amount of any Basis Risk Payment (without
regard to Net Swap Receipts) for such Distribution Date;
(T) from
funds on deposit in the Excess Reserve Fund Account with respect to such
Distribution Date, an amount equal to any remaining Basis Risk CarryForward
Amount with respect to the Offered Certificates for such Distribution Date,
allocated to the Offered Certificates in the same order and priority in which
the Accrued Certificate Interest Distribution Amount is allocated among such
Classes of Certificates, with the allocation to the Class A Certificates
being
(a) first, among the Class A Certificates, pro
rata,
based
on their respective Class Certificate Balances and (b) second, any remaining
amounts to the Class A Certificates, pro
rata,
based
on any Basis Risk CarryForward Amounts remaining unpaid, in order to reimburse
such unpaid amounts;
(U) to
the
Swap Account, the amount of any remaining Defaulted Swap Termination Payment
owed to the Swap Provider;
(V) to
the
Class X Certificates, the remainder of the Class X Distributable Amount not
distributed pursuant to Sections 4.02(a)(iii)(A)-(U); and
(W) if
such
Distribution Date follows the Prepayment Period during which occurs the latest
date on which a Prepayment Charge may be required to be paid in respect of
any
Mortgage Loan, to the Class P Certificates, in reduction of the Class
Certificate Balance thereof; and
(X) to
the
Class
RResidual
Certificates, any remaining amount in the Trust REMICs.
(ii) Solely
for purposes of interest allocation calculations, the Interest Remittance
Amount
attributable to Group I Mortgage Loans will be allocated:
(1) first,
to
the Class A-1 Certificates, the Accrued Certificate Interest Distribution
Amount
and any Unpaid Interest Amount for the Class A-1 Certificates; and
(2) second,
concurrently, to the Class A-2fpt, Class A-2a, Class A-2b, Class A-2c, and
Class
A-2d Certificates, pro rata (based on the amounts distributable or payable
under
Section 4.02(a)(i)(B) to such Classes of Certificates), the Accrued Certificate
Interest Distribution Amount and any Unpaid Interest Amount for the Class
A-2fpt, Class A-2a, Class A-2b, Class A-2c and Class A-2d Certificates,
respectively, to the extent not otherwise previously paid from the Interest
Remittance Amount attributable to Group II Mortgage Loans.
(iii) Solely
for purposes of interest allocation calculations, the Interest Remittance
Amount
attributable to Group II Mortgage Loans will be allocated:
Section
1.02 deliver,
in the name of the designated transferee or transferees, one or more new
Certificates of the same Class and aggregate Percentage
Interest.
At
the
option of a Certificateholder, Certificates may be exchanged for other
Certificates of the same Class in authorized denominations and evidencing
the
same aggregate Percentage Interest upon surrender of the Certificates to
be
exchanged at the office or agency of the Securities Administrator. Whenever
any
Certificates are so surrendered for exchange, the Securities Administrator
shall
execute, authenticate, and deliver the Certificates which the Certificateholder
making the exchange is entitled to receive. Every Certificate presented or
surrendered for registration of transfer or exchange shall be accompanied
by a
written instrument of transfer in form satisfactory to the Securities
Administrator duly executed by the Holder thereof or his attorney duly
authorized in writing.
No
service charge to the Certificateholders shall be made for any registration
of
transfer or exchange of Certificates, but payment of a sum sufficient to
cover
any tax or governmental charge that may be imposed in connection with any
transfer or exchange of Certificates may be required.
All
Certificates surrendered for registration of transfer or exchange shall be
cancelled and subsequently destroyed by the Securities Administrator in
accordance with the Securities Administrator’s customary
procedures.
(a) No
transfer of a Private Certificate shall be made unless such transfer is
made
pursuant to an effective registration statement under the Securities Act
and any
applicable state securities laws or is exempt from the registration requirements
under said Act and such state securities laws. In determining whether a
transfer
is being made pursuant to an effective registration statement, the Securities
Administrator shall be entitled to rely solely upon a written notice to
such
effect from the Depositor. Except with respect to (i) the transfer of the
Class
X, Class P or Class
RResidual
Certificates to the Depositor or
an
Affiliate of the Depositor or, in the case of the Class R-X Certificates,
the
initial transfer by an Affiliate of the Depositor or the first transfer
by the
initial transferee of
an
Affiliate of the Depositor, (ii) the transfer of the Class X or Class P
Certificates to the NIM Issuer or the NIM Trustee, or (iii) a transfer
of the
Class X or Class P Certificates from the NIM Issuer or the NIM Trustee
to the
Depositor or an Affiliate of the Depositor, in the event that a transfer
of a
Private Certificate which is a Physical Certificate is to be made in reliance
upon an exemption from the Securities Act and such laws, in order to assure
compliance with the Securities Act and such laws, the Certificateholder
desiring
to effect such transfer shall certify to the Securities Administrator in
writing
the facts surrounding the transfer in substantially the form set forth
in
Exhibit H (the “Transferor
Certificate”)
and
either (i) there shall be delivered to the Securities Administrator a letter
in
substantially the form of Exhibit I (the “Rule
144A Letter”)
or
(ii) there shall be delivered to the Securities Administrator at the expense
of
the transferor an Opinion of Counsel that such transfer may be made without
registration under the Securities Act. In the event that a transfer of
a Private
Certificate which is a Book-Entry Certificate is to be made in reliance
upon an
exemption from the Securities Act and such laws, in order to assure compliance
with the Securities Act and such laws, the Certificateholder desiring to
effect
such transfer will be deemed to have made as of the transfer date each
of the
certifications set forth in the Transferor Certificate in respect of such
Certificate and the transferee will be deemed to have made as of the transfer
date each of the certifications set forth in the Rule 144A Letter in respect
of
such Certificate, in each case as if such Certificate were evidenced by
a
Physical Certificate. The Depositor shall provide to any Holder of a Private
Certificate and any prospective transferee designated by any such Holder,
information regarding the related Certificates and the Mortgage Loans and
such
other information as shall be necessary to satisfy the condition to eligibility
set forth in Rule 144A(d)(4) for transfer of any such Certificate without
registration thereof under the Securities Act pursuant to the registration
exemption provided by Rule 144A. The Securities Administrator and the Servicer
shall cooperate with the Depositor in providing the Rule 144A information
referenced in the preceding sentence, including providing to the Depositor
such
information regarding the Certificates, the Mortgage Loans and other matters
regarding the Trust Fund as the Depositor shall reasonably request to meet
its
obligation under the preceding sentence. Each Holder of a Private Certificate
desiring to effect such transfer shall, and does hereby agree to, indemnify
the
Trustee, the Securities Administrator, the Depositor and the Servicer against
any liability that may result if the transfer is not so exempt or is not
made in
accordance with such federal and state laws.
Except
with respect to (A) the transfer of the
Class R,
Class
X
or,
Class P
or
Residual Certificates
to the Depositor or
an
Affiliate of the Depositor or, in the case of the Class R-X Certificates,
the
initial transfer by an Affiliate of the Depositor or the first transfer
by the
initial transferee of
an
Affiliate of the Depositor, (B) the transfer of the Class X or Class P
Certificates to the NIM Issuer or the NIM Trustee, or (C) a transfer of
the
Class X or Class P Certificates from the NIM Issuer or the NIM Trustee
to the
Depositor or an Affiliate of the Depositor, no transfer of an ERISA-Restricted
Certificate shall be made unless the Securities Administrator shall have
received either (i) a representation from the transferee of such Certificate
acceptable to and in form and substance satisfactory to the Securities
Administrator (in the event such Certificate is a Class P Certificate or
a
Residual Certificate, such requirement is satisfied only by the Securities
Administrator’s receipt of a representation letter from the transferee
substantially in the form of Exhibit I), to the effect that such transferee
is
not an employee benefit plan or arrangement subject to Section 406 of ERISA,
a
plan subject to Section 4975 of the Code or a plan subject to any Federal,
state
or local law (“Similar
Law”)
materially similar to the foregoing provisions of ERISA or the Code, nor
a
Person acting on behalf of any such plan or arrangement nor using the assets
of
any such plan or arrangement to effect such transfer, or (ii) in the case
of an
ERISA-Restricted Certificate other than a Residual Certificate or a Class
P
Certificate that has been the subject of an ERISA-Qualifying Underwriting,
and
the purchaser is an insurance company, a representation that the purchaser
is an
insurance company that is purchasing such Certificates with funds contained
in
an “insurance company general account” (as such term is defined in Section V(e)
of Prohibited Transaction Class Exemption 95-60 (“PTCE
95-60”))
and
that it is eligible for exemptive relief under PTCE 95-60 prior to termination
of the Supplemental Interest Trust and the purchase and holding of such
Certificates are covered under Sections I and III of PTCE 95-60 after
termination of the Supplemental Interest Trust or (iii) in the case of
any such
ERISA-Restricted Certificate other than a Residual Certificate or Class
P
Certificate presented for registration in the name of an employee benefit
plan
subject to Title I of ERISA, a plan or arrangement subject to Section 4975
of
the Code (or comparable provisions of any subsequent enactments), or a
plan
subject to Similar Law, or a trustee of any such plan or any other person
acting
on behalf of any such plan or arrangement or using such plan’s or arrangement’s
assets, an Opinion of Counsel satisfactory to the Securities Administrator,
which Opinion of Counsel shall not be an expense of the Servicer, the Depositor,
the Securities Administrator or the Trust Fund, addressed to the Securities
Administrator, to the
(b) together
with such additional information as may be required by such Form, and update
such information at the time or times in the manner required by the
Code;
(c) make
an
election that each Trust REMIC be treated as a REMIC on the federal tax return
for its first taxable year (and, if necessary, under applicable state
law);
(d) prepare
and forward to the Certificateholders and to the Internal Revenue Service
and,
if necessary, state tax authorities, all information returns and reports
as and
when required to be provided to them in accordance with the REMIC Provisions,
including the calculation of any original issue discount using the prepayment
assumption (as described in the Prospectus Supplement);
(e) provide
information necessary for the computation of tax imposed on the Transfer
of a
Residual Certificate to a Person that is a Non-Permitted Transferee, or an
agent
(including a broker, nominee or other middleman) of a Non-Permitted Transferee,
or a pass-through entity in which a Non-Permitted Transferee is the record
holder of an interest (the reasonable cost of computing and furnishing such
information may be charged to the Person liable for such tax);
(f) to
the
extent that they are under its control, conduct matters relating to such
assets
at all times that any Certificates are Outstanding so as to maintain the
status
of each Trust REMIC as a REMIC under the REMIC Provisions;
(g) not
knowingly or intentionally take any action or omit to take any action that
would
cause the termination of the REMIC status of any Trust REMIC created
hereunder;
(h) pay,
from
the sources specified in the last paragraph of this Section 8.11, the amount
of
any federal or state tax, including prohibited transaction taxes as described
below, imposed on any Trust REMIC created hereunder before its termination
when
and as the same shall be due and payable (but such obligation shall not prevent
the Securities Administrator or any other appropriate Person from contesting
any
such tax in appropriate proceedings and shall not prevent the Securities
Administrator from withholding payment of such tax, if permitted by law,
pending
the outcome of such proceedings);
(i) cause
federal, state or local income tax or information returns to be signed by
the
Trustee or such other Person as may be required to sign such returns by the
Code
or state or local laws, regulations or rules; and
(j) maintain
records relating to each Trust REMIC created hereunder, including the income,
expenses, assets, and liabilities thereof on a calendar year basis and on
the
accrual method of accounting and the fair market value and adjusted basis
of the
assets determined at such intervals as may be required by the Code, as may
be
necessary to prepare the foregoing returns, schedules, statements or
information.
The
Holder of the largest Percentage Interest of the Class R Certificates shall
act
as Tax Matters Person for each
Trust REMIC
I,
REMIC II and REMIC III,
within
the meaning of Treasury Regulations Section 1.860F-4(d),
and the.
The
Holder of the largest Percentage Interest of the Class R-X Certificates
shall
act as Tax Matters Person for REMIC IV, REMIC V and REMIC VI, within the
meaning
of Treasury Regulations Section 1.860F-4(d). The
Securities Administrator is hereby designated as agent of such Certificateholder
for such purpose (or if the Securities Administrator is not so permitted,
such
Holder shall be the Tax Matters Person in accordance with the REMIC Provisions).
In such capacity, the Securities Administrator shall, as and when necessary
and
appropriate, represent each Trust REMIC created hereunder in any administrative
or judicial proceedings relating to an examination or audit by any governmental
taxing authority, request an administrative adjustment as to any taxable
year of
each Trust REMIC created hereunder, enter into settlement agreements with
any
governmental taxing agency, extend any statute of limitations relating
to any
tax item of each Trust REMIC created hereunder, and otherwise act on behalf
of
each Trust REMIC in relation to any tax matter or controversy involving
it.
To
enable
the Securities Administrator to perform its duties under this Agreement,
the
Depositor shall provide to the Securities Administrator within ten days after
the Closing Date all information or data that the Securities Administrator
requests in writing and determines to be relevant for tax purposes to the
valuations and offering prices of the Certificates, including the price,
yield,
prepayment assumption, and projected cash flows of the Certificates and the
Mortgage Loans. Moreover, the Depositor shall provide information to the
Securities Administrator concerning the value, if any, to each Class of
Certificates of the right to receive Basis Risk CarryForward Amounts from
the
Excess Reserve Fund Account and Basis Risk CarryForward Amounts from the
Swap
Account. Thereafter, the Depositor shall provide to the Securities Administrator
promptly upon written request therefor any additional information or data
that
the Securities Administrator may, from time to time, reasonably request to
enable the Securities Administrator to perform its duties under this Agreement;
provided,
however,
that
the Depositor shall not be required to provide any information regarding
the
Mortgage Loans that the Servicer is required to provide to the Securities
Administrator pursuant to this Agreement. The Depositor hereby indemnifies
the
Securities Administrator for any losses, liabilities, damages, claims, or
expenses of the Securities Administrator arising from any errors or
miscalculations of the Securities Administrator that result from any failure
of
the Depositor to provide pursuant to this paragraph accurate information
or data
to the Securities Administrator on a timely basis.
None
of
the Servicer, the Trustee or the Securities Administrator shall (i) permit
the
creation of any interests in any Trust REMIC other than the regular and residual
interests set forth in the Preliminary Statement, (ii) receive any amount
representing a fee or other compensation for services (except as otherwise
permitted by this Agreement or the related Mortgage Loan documents) or (iii)
otherwise knowingly or intentionally take any action, cause the Trust Fund
to
take any action or fail to take (or fail to cause to be taken) any action
reasonably within its control and the scope of duties more specifically set
forth herein, that, under the REMIC Provisions, if taken or not taken, as
the
case may be, could (i) endanger the status of any Trust REMIC as a REMIC
or (ii)
result in the imposition of a tax upon any Trust REMIC or the Trust Fund
(including but not limited to the tax on “prohibited transactions” as defined in
Section 860F(a)(2) of the Code and the tax on contributions to a REMIC set
forth
in Section 860G(d) of the Code, or the tax on “net income from foreclosure
property”) unless the Trustee and the Securities Administrator receive an
Opinion of Counsel (at the expense of the party seeking to take such action
or,
if such party fails to pay such expense, and the Securities Administrator
determines that taking such action is in the best interest of the Trust Fund
and
the Certificateholders, at the expense of the Trust Fund, but in no event
at the
expense of the Trustee
A
Notice
of Final Distribution, specifying the Distribution Date on which
Certificateholders may surrender their Certificates for payment of the final
distribution and cancellation, shall be given promptly by the Securities
Administrator by letter to Certificateholders mailed not earlier than the
10th
day and not later than the 15th day of the month of such final distribution.
Any
such Notice of Final Distribution shall specify (a) the Distribution Date
upon
which final distribution on the Certificates will be made upon presentation
and
surrender of Certificates at the office therein designated, (b) the amount
of
such final distribution, (c) the location of the office or agency at which
such
presentation and surrender must be made, and (d) that the Record Date otherwise
applicable to such Distribution Date is not applicable, distributions being
made
only upon presentation and surrender of the Certificates at the office therein
specified. The Securities Administrator will give such Notice of Final
Distribution to each Rating Agency at the time such Notice of Final Distribution
is given to Certificateholders.
In
the
event such Notice of Final Distribution is given, the Servicer shall cause
all
funds in the Collection Account to be remitted to the Securities Administrator
for deposit in the Distribution Account on the Business Day prior to the
applicable Distribution Date in an amount equal to the final distribution
in
respect of the Certificates. Upon such final deposit with respect to the
Trust
Fund and the receipt by the Custodian of a Request for Release therefor,
the
Custodian shall promptly release to the Servicer, the Custodial Files for
the
Mortgage Loans.
Upon
presentation and surrender of the Certificates, the Securities Administrator
shall cause to be distributed to the Certificateholders of each Class (after
reimbursement of all amounts due to the Servicer, the Securities Administrator,
the Depositor and the Trustee hereunder), in each case on the final Distribution
Date and in the order set forth in Section 4.02, in proportion to their
respective Percentage Interests, with respect to Certificateholders of the
same
Class, up to an amount equal to (i) as to each Class of Regular Certificates
(except the Class X Certificates), the Certificate Balance thereof plus for
each
such Class and the Class X Certificates accrued interest thereon in the case
of
an interest-bearing Certificate and all other amounts to which such Classes
are
entitled pursuant to Section 4.02 and (ii) as to the Residual Certificates,
the
amount, if any, which remains on deposit in the Distribution Account (other
than
the amounts retained to meet claims) after application pursuant to clause
(i)
above.
In
the
event that any affected Certificateholders shall not surrender Certificates
for
cancellation within six months after the date specified in the above mentioned
written notice, the Securities Administrator shall give a second written
notice
to the remaining Certificateholders to surrender their Certificates for
cancellation and receive the final distribution with respect thereto. If
within
six months after the second notice all the applicable Certificates shall
not
have been surrendered for cancellation, the Securities Administrator may
take
appropriate steps, or may appoint an agent to take appropriate steps, to
contact
the remaining Certificateholders concerning surrender of their Certificates,
and
the cost thereof shall be paid out of the funds and other assets which
remain a
part of the Trust Fund. If within one year after the second notice all
Certificates shall not have been surrendered for cancellation, the Class
RResidual
Certificateholders shall be entitled to all unclaimed funds and other assets
of
the Trust Fund which remain subject hereto.
XXXXXX
XXXXXXX ABS CAPITAL I INC.
Xxxxxx
Xxxxxxx ABS Capital I Inc. Trust 2006-WMC2
Mortgage
Pass-Through Certificates, Series 2006-WMC2
Class [R][R-X]
evidencing
a percentage interest in the distributions allocable to the Certificates
of the
above-referenced Class.
Distributions
in respect of this Certificate is distributable monthly as set forth herein.
This Class [R][R-X]
Certificate has no Certificate Balance and is not entitled to distributions
in
respect of principal or interest. This Certificate does not evidence an
obligation of, or an interest in, and is not guaranteed by the Depositor,
the
Trustee or any other party to the Agreement referred to below or any of
their
respective affiliates. Neither this Certificate nor the Mortgage Loans
are
guaranteed or insured by any governmental agency or
instrumentality.
This
certifies that _____________ is the registered owner of the Percentage Interest
evidenced by this Certificate (obtained by dividing the denomination of this
Certificate by the aggregate of the denominations of all Certificates of
the
Class to which this Certificate belongs) in certain monthly distributions
pursuant to a Pooling and Servicing Agreement dated as of the Cut-off Date
specified above (the “Agreement”)
among
Xxxxxx Xxxxxxx ABS Capital I Inc., as depositor (the “Depositor”),
Xxxxx
Fargo Bank, N.A., as securities administrator (the “Securities
Administrator”),
Xxxxx
Fargo Bank, N.A., as servicer and custodian, WMC Mortgage Corp., as responsible
party, and Deutsche Bank National Trust Company, as trustee (the “Trustee”).
To
the extent not defined herein, the capitalized terms used herein have the
meanings assigned in the Agreement. This Certificate is issued under and
is
subject to the terms, provisions and conditions of the Agreement, to which
Agreement the Holder of this Certificate by virtue of the acceptance hereof
assents and by which such Holder is bound.
Any
distribution of the proceeds of any remaining assets of the Trust Fund
will be
made only upon presentment and surrender of this Class [R][R-X]
Certificate at the offices designated by the Securities Administrator for
such
purposes or such other location specified in the notice to
Certificateholders.
No
transfer of a Class [R][R-X]
Certificate shall be made unless the Securities Administrator shall have
received a representation letter from the transferee of such Certificate,
acceptable to and in form and substance satisfactory to the Securities
Administrator, to the effect that such transferee is not an employee benefit
plan or arrangement subject to Section 406 of ERISA, a plan or arrangement
subject to Section 4975 of the Code or a plan subject to Similar Law, or
a
person acting on behalf of any such plan or arrangement nor using the assets
of
any such plan or arrangement to effect such transfer, which representation
letter shall not be an expense of the Trustee, the Servicer, the Securities
Administrator or the Trust Fund. In the event that such representation
is
violated, or any attempt is made to transfer to a plan or arrangement subject
to
Section 406 of ERISA or a plan subject to Section 4975 of the Code or a
plan
subject to Similar Law, or a person acting on behalf of any such plan or
arrangement or using the assets of any such plan or arrangement, such attempted
transfer or acquisition shall be void and of no effect.
Each
Holder of this Class [R][R-X]
Certificate shall be deemed by the acceptance or acquisition an Ownership
Interest in this Class [R][R-X]
Certificate to have agreed to be bound by the following provisions, and
the
rights of each Person acquiring any Ownership Interest in this Class
[R][R-X]
Certificate are expressly subject to the following provisions: (i) each
Person
holding or acquiring any Ownership Interest in this Class [R][R-X]
Certificate shall be a Permitted Transferee and shall promptly notify the
Securities Administrator of any change or impending change in its status
as a
Permitted Transferee, (ii) no Ownership Interest in this Class [R][R-X]
Certificate may be registered on the Closing Date or thereafter transferred,
and
the Securities Administrator shall not register the Transfer of this Certificate
unless, in addition to the certificates required to be delivered to the
Securities Administrator under Section 5.02(b) of the Agreement, the Securities
Administrator shall have been furnished with a Transfer Affidavit of the
initial
owner or the proposed transferee in the form attached as Exhibit G to the
Agreement, (iii) each Person holding or acquiring any Ownership Interest
in this
Class [R][R-X]
Certificate shall agree (A) to obtain a Transfer Affidavit from any other
Person
to whom such Person attempts to Transfer its Ownership Interest this Class
[R][R-X]
Certificate, (B) to obtain a Transfer Affidavit from any Person for whom
such
Person is acting as nominee, trustee or agent in connection with any Transfer
of
this Class [R][R-X]
Certificate, (C) not to cause income with respect to the Class [R][R-X]
Certificate to be attributable to a foreign permanent establishment or
fixed
base, within the meaning of an applicable income tax treaty, of such Person
or
any other U.S. Person and (D) not to Transfer the Ownership Interest in
this
Class [R][R-X]
Certificate or to cause the Transfer of the Ownership Interest in this
Class
[R][R-X]
Certificate to any other Person if it has actual knowledge that such Person
is a
Non-Permitted Transferee and (iv) any attempted or purported Transfer of
the
Ownership Interest in this Class [R][R-X]
Certificate in violation of the provisions herein shall be absolutely null
and
void and shall vest no rights in the purported Transferee.
Reference
is hereby made to the further provisions of this Certificate set forth on
the
reverse hereof, which further provisions shall for all purposes have the
same
effect as if set forth at this place.
This
Certificate shall not be entitled to any benefit under the Agreement or be
valid
for any purpose unless manually authenticated by an authorized signatory
of the
Securities Administrator.
* * *
EXHIBIT
G
RESIDUAL
TRANSFER AFFIDAVIT
Xxxxxx
Xxxxxxx ABS Capital I Inc. Trust 2006-WMC2,
Mortgage
Pass-Through Certificates,
Series
2006-WMC2
|
STATE
OF_____________
|
)
|
|
|
)
|
ss.:
|
|
|
COUNTY
OF___________
|
)
|
The
undersigned, being first duly sworn, deposes and says as follows:
1. The
undersigned is an officer of ___________________, the proposed Transferee
of an
Ownership Interest in a Class [R][R-X]
Certificate (the “Certificate”)
issued
pursuant to the Pooling and Servicing Agreement (the “Agreement”),
relating to the above-referenced Series, by and among Xxxxxx Xxxxxxx ABS
Capital
I Inc., as Depositor, Xxxxx Fargo Bank, N.A., as Servicer, Securities
Administrator and Custodian, WMC Mortgage Corp., as Responsible Party,
and
Deutsche Bank National Trust Company, as Trustee (the “Trustee”).
Capitalized terms used, but not defined herein, shall have the meanings
ascribed
to such terms in the Agreement. The Transferee has authorized the undersigned
to
make this affidavit on behalf of the Transferee for the benefit of the
Depositor
and the Trustee.
2. The
Transferee is, as of the date hereof, and will be, as of the date of the
Transfer, a Permitted Transferee. The Transferee is acquiring its Ownership
Interest in the Certificate for its own account. The Transferee has no knowledge
that any such affidavit is false.
3. The
Transferee has been advised of, and understands that (i) a tax will be imposed
on Transfers of the Certificate to Persons that are Non-Permitted Transferees;
(ii) such tax will be imposed on the transferor, or, if such Transfer is
through
an agent (which includes a broker, nominee or middleman) for a Person that
is a
Non-Permitted Transferee, on the agent; and (iii) the Person otherwise liable
for the tax shall be relieved of liability for the tax if the subsequent
Transferee furnished to such Person an affidavit that such subsequent Transferee
is a Permitted Transferee and, at the time of Transfer, such Person does
not
have actual knowledge that the affidavit is false.
4. The
Transferee has been advised of, and understands that a tax will be imposed
on a
“pass-through entity” holding the Certificate if at any time during the taxable
year of the pass-through entity a Person that is a Non-Permitted Transferee
is
the record holder of an interest in such entity. The Transferee understands
that
such tax will not be imposed for any period with respect to which the record
holder furnishes to the pass-through entity an affidavit that such record
holder
is a Permitted Transferee and the pass-through entity does not have actual
knowledge that such affidavit is false. (For this purpose, a “pass-through
entity” includes a regulated investment company, a real estate investment trust
or common trust fund, a partnership, trust or estate, and certain cooperatives
and, except as may be provided in Treasury Regulations, persons holding
interests in pass-through entities as a nominee for another
Person.)
