ACE SECURITIES CORP. Depositor OCWEN LOAN SERVICING, LLC Servicer WELLS FARGO BANK, NATIONAL ASSOCIATION Master Servicer and Securities Administrator HSBC BANK USA, NATIONAL ASSOCIATION Trustee POOLING AND SERVICING AGREEMENT Dated as of March 1, 2007...
ACE
SECURITIES CORP.
Depositor
OCWEN
LOAN SERVICING, LLC
Servicer
XXXXX
FARGO BANK, NATIONAL ASSOCIATION
Master
Servicer and Securities Administrator
HSBC
BANK
USA, NATIONAL ASSOCIATION
Trustee
Dated
as
of March 1, 2007
Asset
Backed Pass-Through Certificates
TABLE
OF
CONTENTS
|
ARTICLE
I DEFINITIONS
|
10
|
|
|
SECTION
1.01.
|
Defined
Terms.
|
10
|
|
SECTION
1.02.
|
Allocation
of Certain Interest Shortfalls.
|
88
|
|
ARTICLE
II CONVEYANCE OF MORTGAGE LOANS; ORIGINAL ISSUANCE OF
CERTIFICATES
|
90
|
|
|
SECTION
2.01.
|
Conveyance
of the Mortgage Loans.
|
90
|
|
SECTION
2.02.
|
Acceptance
of REMIC I by Trustee.
|
91
|
|
SECTION
2.03.
|
Repurchase
or Substitution of Mortgage Loans.
|
91
|
|
SECTION
2.04.
|
Representations
and Warranties of the Master Servicer.
|
94
|
|
SECTION
2.05.
|
Representations,
Warranties and Covenants of the Servicer.
|
96
|
|
SECTION
2.06.
|
Issuance
of the REMIC I Regular Interests and the Class R-I
Interest.
|
98
|
|
SECTION
2.07.
|
Conveyance
of the REMIC I Regular Interests; Acceptance of REMIC II and
REMIC III by
the Trustee.
|
98
|
|
SECTION
2.08.
|
Issuance
of the Residual Certificates.
|
99
|
|
SECTION
2.09.
|
Establishment
of the Trust.
|
99
|
|
SECTION
2.10.
|
Purpose
and Powers of the Trust.
|
99
|
|
SECTION
2.11.
|
Representations
and Warranties of the Trustee.
|
100
|
|
ARTICLE
III ADMINISTRATION AND SERVICING OF THE MORTGAGE LOANS;
ACCOUNTS
|
101
|
|
|
SECTION
3.01.
|
The
Servicer to Act as Servicer.
|
101
|
|
SECTION
3.02.
|
Sub-Servicing
Agreements Between the Servicer and Sub-Servicers.
|
104
|
|
SECTION
3.03.
|
Successor
Sub-Servicers.
|
105
|
|
SECTION
3.04.
|
No
Contractual Relationship Between Sub-Servicer, Subcontractor,
Trustee or
the Certificateholders.
|
106
|
|
SECTION
3.05.
|
Assumption
or Termination of Sub-Servicing Agreement by Successor
Servicer.
|
106
|
|
SECTION
3.06.
|
Collection
of Certain Mortgage Loan Payments.
|
106
|
|
SECTION
3.07.
|
Collection
of Taxes, Assessments and Similar Items; Servicing
Accounts.
|
107
|
|
SECTION
3.08.
|
Collection
Account and Distribution Account.
|
108
|
|
SECTION
3.09.
|
Withdrawals
from the Collection Account and Distribution Account.
|
110
|
|
SECTION
3.10.
|
Investment
of Funds in the Investment Accounts.
|
113
|
|
SECTION
3.11.
|
Maintenance
of Hazard Insurance, Errors and Omissions and Fidelity Coverage
and
Primary Mortgage Insurance.
|
114
|
|
SECTION
3.12.
|
Enforcement
of Due-on-Sale Clauses; Assumption Agreements
|
116
|
|
SECTION
3.13.
|
Realization
Upon Defaulted Mortgage Loans.
|
117
|
|
SECTION
3.14.
|
Trustee
to Cooperate; Release of Mortgage Files.
|
119
|
|
SECTION
3.15.
|
Servicing
Compensation.
|
121
|
|
SECTION
3.16.
|
Collection
Account Statements.
|
121
|
|
SECTION
3.17.
|
Annual
Statement as to Compliance.
|
121
|
i
|
SECTION
3.18.
|
Assessments
of Compliance and Attestation Reports.
|
122
|
|
SECTION
3.19.
|
[Reserved].
|
123
|
|
SECTION
3.20.
|
Annual
Certification; Additional Information.
|
124
|
|
SECTION
3.21.
|
Access
to Certain Documentation.
|
125
|
|
SECTION
3.22.
|
Title,
Management and Disposition of REO Property.
|
125
|
|
SECTION
3.23.
|
Obligations
of the Servicer in Respect of Prepayment Interest Shortfalls;
Relief Act
Interest Shortfalls.
|
129
|
|
SECTION
3.24.
|
Obligations
of the Servicer in Respect of Mortgage Rates and Monthly
Payments.
|
129
|
|
SECTION
3.25.
|
Reserve
Fund.
|
129
|
|
SECTION
3.26.
|
Advance
Facility.
|
132
|
|
SECTION
3.27.
|
Indemnification.
|
134
|
|
ARTICLE
IV ADMINISTRATION AND MASTER SERVICING OF THE MORTGAGE LOANS
BY THE MASTER
SERVICER
|
135
|
|
|
SECTION
4.01.
|
Master
Servicer.
|
135
|
|
SECTION
4.02.
|
REMIC-Related
Covenants.
|
136
|
|
SECTION
4.03.
|
Monitoring
of Servicer.
|
136
|
|
SECTION
4.04.
|
Fidelity
Bond.
|
137
|
|
SECTION
4.05.
|
Power
to Act; Procedures.
|
137
|
|
SECTION
4.06.
|
Due-on-Sale
Clauses; Assumption Agreements.
|
138
|
|
SECTION
4.07.
|
Documents,
Records and Funds in Possession of Master Servicer To Be Held
for
Trustee.
|
138
|
|
SECTION
4.08.
|
Standard
Hazard Insurance and Flood Insurance Policies.
|
139
|
|
SECTION
4.09.
|
Presentment
of Claims and Collection of Proceeds.
|
139
|
|
SECTION
4.10.
|
Maintenance
of Primary Mortgage Insurance Policies.
|
139
|
|
SECTION
4.11.
|
Trustee
to Retain Possession of Certain Insurance Policies and
Documents.
|
140
|
|
SECTION
4.12.
|
Realization
Upon Defaulted Mortgage Loans.
|
140
|
|
SECTION
4.13.
|
Compensation
for the Master Servicer.
|
140
|
|
SECTION
4.14.
|
REO
Property.
|
141
|
|
SECTION
4.15.
|
Master
Servicer Annual Statement of Compliance.
|
141
|
|
SECTION
4.16.
|
Master
Servicer Assessments of Compliance.
|
142
|
|
SECTION
4.17.
|
Master
Servicer Attestation Reports.
|
143
|
|
SECTION
4.18.
|
Annual
Certification.
|
144
|
|
SECTION
4.19.
|
Obligation
of the Master Servicer in Respect of Prepayment Interest
Shortfalls.
|
145
|
|
SECTION
4.20.
|
Prepayment
Penalty Verification.
|
145
|
|
ARTICLE
V PAYMENTS TO CERTIFICATEHOLDERS
|
147
|
|
|
SECTION
5.01.
|
Distributions.
|
147
|
|
SECTION
5.02.
|
Statements
to Certificateholders.
|
161
|
|
SECTION
5.03.
|
Servicer
Reports; P&I Advances.
|
165
|
|
SECTION
5.04.
|
Allocation
of Realized Losses.
|
166
|
|
SECTION
5.05.
|
Compliance
with Withholding Requirements.
|
169
|
|
SECTION
5.06.
|
Reports
Filed with Securities and Exchange Commission.
|
170
|
ii
|
SECTION
5.07.
|
Supplemental
Interest Trust.
|
175
|
|
SECTION
5.08.
|
Tax
Treatment of Swap Payments and Swap Termination Payments.
|
178
|
|
SECTION
5.09.
|
Swap
Collateral Account.
|
178
|
|
SECTION
5.10.
|
Cap
Collateral Account
|
179
|
|
ARTICLE
VI THE CERTIFICATES
|
181
|
|
|
SECTION
6.01.
|
The
Certificates.
|
181
|
|
SECTION
6.02.
|
Registration
of Transfer and Exchange of Certificates.
|
183
|
|
SECTION
6.03.
|
Mutilated,
Destroyed, Lost or Stolen Certificates.
|
190
|
|
SECTION
6.04.
|
Persons
Deemed Owners.
|
191
|
|
SECTION
6.05.
|
Certain
Available Information.
|
191
|
|
ARTICLE
VII THE DEPOSITOR, THE SERVICER AND THE MASTER SERVICER
|
193
|
|
|
SECTION
7.01.
|
Liability
of the Depositor, the Servicer and the Master Servicer.
|
193
|
|
SECTION
7.02.
|
Merger
or Consolidation of the Depositor, the Servicer or the Master
Servicer.
|
193
|
|
SECTION
7.03.
|
Limitation
on Liability of the Depositor, the Servicer, the Master Servicer
and
Others.
|
193
|
|
SECTION
7.04.
|
Limitation
on Resignation of the Servicer.
|
194
|
|
SECTION
7.05.
|
Limitation
on Resignation of the Master Servicer.
|
196
|
|
SECTION
7.06.
|
Assignment
of Master Servicing.
|
196
|
|
SECTION
7.07.
|
Rights
of the Depositor in Respect of the Servicer and the Master
Servicer.
|
197
|
|
SECTION
7.08.
|
Duties
of the Credit Risk Manager.
|
198
|
|
SECTION
7.09.
|
Limitation
Upon Liability of the Credit Risk Manager.
|
198
|
|
SECTION
7.10.
|
Removal
of the Credit Risk Manager.
|
198
|
|
ARTICLE
VIII DEFAULT
|
200
|
|
|
SECTION
8.01.
|
Servicer
Events of Default.
|
200
|
|
SECTION
8.02.
|
Master
Servicer to Act; Appointment of Successor.
|
204
|
|
SECTION
8.03.
|
Notification
to Certificateholders.
|
207
|
|
SECTION
8.04.
|
Waiver
of Events of Default.
|
207
|
|
ARTICLE
IX CONCERNING THE TRUSTEE AND THE SECURITIES ADMINISTRATOR
|
208
|
|
|
SECTION
9.01.
|
Duties
of Trustee and Securities Administrator.
|
208
|
|
SECTION
9.02.
|
Certain
Matters Affecting Trustee and Securities Administrator.
|
209
|
|
SECTION
9.03.
|
Trustee
and Securities Administrator not Liable for Certificates or Mortgage
Loans.
|
213
|
|
SECTION
9.04.
|
Trustee
and Securities Administrator May Own Certificates.
|
213
|
|
SECTION
9.05.
|
Fees
and Expenses of Trustee, Custodian and Securities
Administrator.
|
213
|
|
SECTION
9.06.
|
Eligibility
Requirements for Trustee and Securities Administrator.
|
214
|
|
SECTION
9.07.
|
Resignation
and Removal of Trustee and Securities Administrator.
|
215
|
|
SECTION
9.08.
|
Successor
Trustee or Securities Administrator.
|
216
|
iii
|
SECTION
9.09.
|
Merger
or Consolidation of Trustee or Securities Administrator.
|
217
|
|
SECTION
9.10.
|
Appointment
of Co-Trustee or Separate Trustee.
|
217
|
|
SECTION
9.11.
|
Appointment
of Office or Agency.
|
218
|
|
SECTION
9.12.
|
Representations
and Warranties.
|
218
|
|
ARTICLE
X XXXXXXXXXXX
|
000
|
|
|
XXXXXXX
00.00.
|
Xxxxxxxxxxx
Xxxx Xxxxxxxxxx or Liquidation of All Mortgage Loans.
|
220
|
|
SECTION
10.02.
|
Additional
Termination Requirements.
|
223
|
|
ARTICLE
XI REMIC PROVISIONS
|
225
|
|
|
SECTION
11.01.
|
REMIC
Administration.
|
225
|
|
SECTION
11.02.
|
Prohibited
Transactions and Activities.
|
227
|
|
SECTION
11.03.
|
Indemnification.
|
228
|
|
ARTICLE
XII MISCELLANEOUS PROVISIONS
|
229
|
|
|
SECTION
12.01.
|
Amendment.
|
229
|
|
SECTION
12.02.
|
Recordation
of Agreement; Counterparts.
|
230
|
|
SECTION
12.03.
|
Limitation
on Rights of Certificateholders.
|
231
|
|
SECTION
12.04.
|
Governing
Law.
|
231
|
|
SECTION
12.05.
|
Notices.
|
231
|
|
SECTION
12.06.
|
Severability
of Provisions.
|
232
|
|
SECTION
12.07.
|
Notice
to Rating Agencies.
|
232
|
|
SECTION
12.08.
|
Article
and Section References.
|
233
|
|
SECTION
12.09.
|
Grant
of Security Interest.
|
233
|
|
SECTION
12.10.
|
Survival
of Indemnification.
|
234
|
|
SECTION
12.11.
|
Intention
of the Parties and Interpretation.
|
234
|
|
SECTION
12.12.
|
Indemnification.
|
234
|
|
SECTION
12.13.
|
Swap
Provider as a Third Party Beneficiary.
|
235
|
iv
Exhibits
|
Exhibit
A-1
|
Form
of Class A Certificate
|
|
Exhibit
A-2
|
Form
of Class M Certificate
|
|
Exhibit
A-3
|
Form
of Class CE Certificate
|
|
Exhibit
A-4
|
Form
of Class P Certificate
|
|
Exhibit
A-5
|
Form
of Class R Certificate
|
|
Exhibit
B-1
|
Form
of Transferor Representation Letter and Form of Transferee Representation
Letter in Connection with Transfer of the Class P Certificates, Class
CE
Certificates and Residual Certificates Pursuant to Rule 144A Under
the
Securities Act
|
|
Exhibit
B-2
|
Form
of Transferor Representation Letter and Form of Transferee Representation
Letter in Connection with Transfer of the Class P Certificates, Class
CE
Certificates and Residual Certificates Pursuant to Rule 501(a) Under
the
Securities Act
|
|
Exhibit
B-3
|
Form
of Transferor Representation Letter and Form of Transferee Representation
Letter in Connection with Transfer of the Class P Certificates, Class
CE
Certificates and Residual Certificates Pursuant to Rule 501(a) Under
the
Securities Act
|
|
Exhibit
B-4
|
Form
of Transfer Affidavit and Agreement and Form of Transferor Affidavit
in
Connection with Transfer of Residual Certificates
|
|
Exhibit
C
|
Form
of Back-Up Certification
|
|
Exhibit
D
|
Form
of Power of Attorney
|
|
Exhibit
E
|
Servicing
Criteria
|
|
Exhibit
F
|
Mortgage
Loan Purchase Agreement
|
|
Exhibit
G
|
Form
10-D, Form 8-K and Form 10-K Reporting Responsibility
|
|
Exhibit
H
|
Additional
Disclosure Notification
|
|
Exhibit
I
|
Swap
Agreement
|
|
Exhibit
J
|
Cap
Contracts
|
|
Schedule
1
|
Mortgage
Loan Schedule
|
|
Schedule
2
|
Prepayment
Charge Schedule
|
|
Schedule
3
|
Reserved
|
|
Schedule
4
|
Standard
File Layout - Delinquency Reporting and Realized Losses and
Gains
|
|
Schedule
5
|
Standard
File Layout - Master Servicing
|
|
Schedule
6
|
Data
Requirements of Servicing Advances Incurred Prior to Cut-off
Date
|
v
This
Pooling and Servicing Agreement, is dated and effective as of March 1, 2007,
among ACE SECURITIES CORP., as Depositor, OCWEN LOAN SERVICING, LLC, as
Servicer, XXXXX FARGO BANK, NATIONAL ASSOCIATION, as Master Servicer and
Securities Administrator and HSBC BANK USA, NATIONAL ASSOCIATION, as
Trustee.
PRELIMINARY
STATEMENT:
The
Depositor intends to sell pass-through certificates to be issued hereunder
in
multiple classes, which in the aggregate will evidence the entire beneficial
ownership interest of the Trust Fund created hereunder. The Trust Fund will
consist of a segregated pool of assets comprised of the Mortgage Loans and
certain other related assets subject to this Agreement.
REMIC
I
As
provided herein, the Securities Administrator will elect to treat the segregated
pool of assets consisting of the Mortgage Loans and certain other related assets
subject to this Agreement (other than the Reserve Fund and, for the avoidance
of
doubt, the Supplemental Interest Trust, the Cap Contracts and the Swap
Agreement) as a REMIC for federal income tax purposes, and such segregated
pool
of assets will be designated as “REMIC I”. The Class R-I Interest will be the
sole class of “residual interests” in REMIC I for purposes of the REMIC
Provisions (as defined herein). The following table irrevocably sets forth
the
designation, the REMIC I Remittance Rate, the initial Uncertificated Balance
and, for purposes of satisfying Treasury regulation Section 1.860G-1(a)(4)(iii),
the “latest possible maturity date” for each of the REMIC I Regular Interests
(as defined herein). None of the REMIC I Regular Interests will be
certificated.
|
Designation
|
REMIC
I
Remittance
Rate
|
Initial
Uncertificated
Balance
|
Latest
Possible
Maturity
Date(1)
|
||||||
|
I
|
Variable(2)
|
$
|
38,343,312.21
|
February
2037
|
|||||
|
I-1-A
|
Variable(2)
|
$
|
3,780,212.51
|
February
2037
|
|||||
|
I-1-B
|
Variable(2)
|
$
|
3,780,212.51
|
February
2037
|
|||||
|
I-2-A
|
Variable(2)
|
$
|
4,039,169.14
|
February
2037
|
|||||
|
I-2-B
|
Variable(2)
|
$
|
4,039,169.14
|
February
2037
|
|||||
|
I-3-A
|
Variable(2)
|
$
|
4,252,818.57
|
February
2037
|
|||||
|
I-3-B
|
Variable(2)
|
$
|
4,252,818.57
|
February
2037
|
|||||
|
I-4-A
|
Variable(2)
|
$
|
4,077,241.54
|
February
2037
|
|||||
|
I-4-B
|
Variable(2)
|
$
|
4,077,241.54
|
February
2037
|
|||||
|
I-5-A
|
Variable(2)
|
$
|
3,908,940.46
|
February
2037
|
|||||
|
I-5-B
|
Variable(2)
|
$
|
3,908,940.46
|
February
2037
|
|||||
|
I-6-A
|
Variable(2)
|
$
|
3,747,612.36
|
February
2037
|
|||||
|
I-6-B
|
Variable(2)
|
$
|
3,747,612.36
|
February
2037
|
|||||
|
I-7-A
|
Variable(2)
|
$
|
3,592,967.76
|
February
2037
|
|||||
|
I-7-B
|
Variable(2)
|
$
|
3,592,967.76
|
February
2037
|
|||||
|
I-8-A
|
Variable(2)
|
$
|
3,444,728.74
|
February
2037
|
|||||
|
I-8-B
|
Variable(2)
|
$
|
3,444,728.74
|
February
2037
|
|||||
|
I-9-A
|
Variable(2)
|
$
|
3,302,628.90
|
February
2037
|
|||||
|
I-9-B
|
Variable(2)
|
$
|
3,302,628.90
|
February
2037
|
|||||
|
I-10-A
|
Variable(2)
|
$
|
3,166,413.25
|
February
2037
|
|||||
|
Designation
|
REMIC
I
Remittance
Rate
|
Initial
Uncertificated
Balance
|
Latest
Possible
Maturity
Date(1)
|
||||||
|
I-10-B
|
Variable(2)
|
$
|
3,166,413.25
|
February
2037
|
|||||
|
I-11-A
|
Variable(2)
|
$
|
3,035,837.36
|
February
2037
|
|||||
|
I-11-B
|
Variable(2)
|
$
|
3,035,837.36
|
February
2037
|
|||||
|
I-12-A
|
Variable(2)
|
$
|
2,917,473.81
|
February
2037
|
|||||
|
I-12-B
|
Variable(2)
|
$
|
2,917,473.81
|
February
2037
|
|||||
|
I-13-A
|
Variable(2)
|
$
|
2,795,997.74
|
February
2037
|
|||||
|
I-13-B
|
Variable(2)
|
$
|
2,795,997.74
|
February
2037
|
|||||
|
I-14-A
|
Variable(2)
|
$
|
2,961,615.63
|
February
2037
|
|||||
|
I-14-B
|
Variable(2)
|
$
|
2,961,615.63
|
February
2037
|
|||||
|
I-15-A
|
Variable(2)
|
$
|
9,009,284.25
|
February
2037
|
|||||
|
I-15-B
|
Variable(2)
|
$
|
9,009,284.25
|
February
2037
|
|||||
|
I-16-A
|
Variable(2)
|
$
|
7,493,234.00
|
February
2037
|
|||||
|
I-16-B
|
Variable(2)
|
$
|
7,493,234.00
|
February
2037
|
|||||
|
I-17-A
|
Variable(2)
|
$
|
6,247,449.66
|
February
2037
|
|||||
|
I-17-B
|
Variable(2)
|
$
|
6,247,449.66
|
February
2037
|
|||||
|
I-18-A
|
Variable(2)
|
$
|
5,092,551.01
|
February
2037
|
|||||
|
I-18-B
|
Variable(2)
|
$
|
5,092,551.01
|
February
2037
|
|||||
|
I-19-A
|
Variable(2)
|
$
|
1,519,210.92
|
February
2037
|
|||||
|
I-19-B
|
Variable(2)
|
$
|
1,519,210.92
|
February
2037
|
|||||
|
I-20-A
|
Variable(2)
|
$
|
1,450,739.05
|
February
2037
|
|||||
|
I-20-B
|
Variable(2)
|
$
|
1,450,739.05
|
February
2037
|
|||||
|
I-21-A
|
Variable(2)
|
$
|
1,385,400.85
|
February
2037
|
|||||
|
I-21-B
|
Variable(2)
|
$
|
1,385,400.85
|
February
2037
|
|||||
|
I-22-A
|
Variable(2)
|
$
|
1,322,771.22
|
February
2037
|
|||||
|
I-22-B
|
Variable(2)
|
$
|
1,322,771.22
|
February
2037
|
|||||
|
I-23-A
|
Variable(2)
|
$
|
1,263,313.47
|
February
2037
|
|||||
|
I-23-B
|
Variable(2)
|
$
|
1,263,313.47
|
February
2037
|
|||||
|
I-24-A
|
Variable(2)
|
$
|
1,206,575.66
|
February
2037
|
|||||
|
I-24-B
|
Variable(2)
|
$
|
1,206,575.66
|
February
2037
|
|||||
|
I-25-A
|
Variable(2)
|
$
|
1,152,430.14
|
February
2037
|
|||||
|
I-25-B
|
Variable(2)
|
$
|
1,152,430.14
|
February
2037
|
|||||
|
I-26-A
|
Variable(2)
|
$
|
1,100,759.32
|
February
2037
|
|||||
|
I-26-B
|
Variable(2)
|
$
|
1,100,759.32
|
February
2037
|
|||||
|
I-27-A
|
Variable(2)
|
$
|
1,051,444.48
|
February
2037
|
|||||
|
I-27-B
|
Variable(2)
|
$
|
1,051,444.48
|
February
2037
|
|||||
|
I-28-A
|
Variable(2)
|
$
|
1,004,307.39
|
February
2037
|
|||||
|
I-28-B
|
Variable(2)
|
$
|
1,004,307.39
|
February
2037
|
|||||
|
I-29-A
|
Variable(2)
|
$
|
959,396.99
|
February
2037
|
|||||
|
I-29-B
|
Variable(2)
|
$
|
959,396.99
|
February
2037
|
|||||
|
I-30-A
|
Variable(2)
|
$
|
916,531.80
|
February
2037
|
|||||
|
I-30-B
|
Variable(2)
|
$
|
916,531.80
|
February
2037
|
|||||
|
I-31-A
|
Variable(2)
|
$
|
875,617.49
|
February
2037
|
|||||
|
I-31-B
|
Variable(2)
|
$
|
875,617.49
|
February
2037
|
|||||
|
I-32-A
|
Variable(2)
|
$
|
836,563.80
|
February
2037
|
|||||
|
I-32-B
|
Variable(2)
|
$
|
836,563.80
|
February
2037
|
|||||
|
I-33-A
|
Variable(2)
|
$
|
799,284.53
|
February
2037
|
|||||
2
|
Designation
|
REMIC
I
Remittance
Rate
|
Initial
Uncertificated
Balance
|
Latest
Possible
Maturity
Date(1)
|
||||||
|
I-33-B
|
Variable(2)
|
$
|
799,284.53
|
February
2037
|
|||||
|
I-34-A
|
Variable(2)
|
$
|
763,692.53
|
February
2037
|
|||||
|
I-34-B
|
Variable(2)
|
$
|
763,692.53
|
February
2037
|
|||||
|
I-35-A
|
Variable(2)
|
$
|
729,721.27
|
February
2037
|
|||||
|
I-35-B
|
Variable(2)
|
$
|
729,721.27
|
February
2037
|
|||||
|
I-36-A
|
Variable(2)
|
$
|
697,290.59
|
February
2037
|
|||||
|
I-36-B
|
Variable(2)
|
$
|
697,290.59
|
February
2037
|
|||||
|
I-37-A
|
Variable(2)
|
$
|
666,328.59
|
February
2037
|
|||||
|
I-37-B
|
Variable(2)
|
$
|
666,328.59
|
February
2037
|
|||||
|
I-38-A
|
Variable(2)
|
$
|
636,768.44
|
February
2037
|
|||||
|
I-38-B
|
Variable(2)
|
$
|
636,768.44
|
February
2037
|
|||||
|
I-39-A
|
Variable(2)
|
$
|
608,545.25
|
February
2037
|
|||||
|
I-39-B
|
Variable(2)
|
$
|
608,545.25
|
February
2037
|
|||||
|
I-40-A
|
Variable(2)
|
$
|
581,597.23
|
February
2037
|
|||||
|
I-40-B
|
Variable(2)
|
$
|
581,597.23
|
February
2037
|
|||||
|
I-41-A
|
Variable(2)
|
$
|
555,866.63
|
February
2037
|
|||||
|
I-41-B
|
Variable(2)
|
$
|
555,866.63
|
February
2037
|
|||||
|
I-42-A
|
Variable(2)
|
$
|
531,296.87
|
February
2037
|
|||||
|
I-42-B
|
Variable(2)
|
$
|
531,296.87
|
February
2037
|
|||||
|
I-43-A
|
Variable(2)
|
$
|
507,835.09
|
February
2037
|
|||||
|
I-43-B
|
Variable(2)
|
$
|
507,835.09
|
February
2037
|
|||||
|
I-44-A
|
Variable(2)
|
$
|
485,430.22
|
February
2037
|
|||||
|
I-44-B
|
Variable(2)
|
$
|
485,430.22
|
February
2037
|
|||||
|
I-45-A
|
Variable(2)
|
$
|
464,033.65
|
February
2037
|
|||||
|
I-45-B
|
Variable(2)
|
$
|
464,033.65
|
February
2037
|
|||||
|
I-46-A
|
Variable(2)
|
$
|
443,599.67
|
February
2037
|
|||||
|
I-46-B
|
Variable(2)
|
$
|
443,599.67
|
February
2037
|
|||||
|
I-47-A
|
Variable(2)
|
$
|
424,083.72
|
February
2037
|
|||||
|
I-47-B
|
Variable(2)
|
$
|
424,083.72
|
February
2037
|
|||||
|
I-48-A
|
Variable(2)
|
$
|
405,444.00
|
February
2037
|
|||||
|
I-48-B
|
Variable(2)
|
$
|
405,444.00
|
February
2037
|
|||||
|
I-49-A
|
Variable(2)
|
$
|
387,640.85
|
February
2037
|
|||||
|
I-49-B
|
Variable(2)
|
$
|
387,640.85
|
February
2037
|
|||||
|
I-50-A
|
Variable(2)
|
$
|
370,635.38
|
February
2037
|
|||||
|
I-50-B
|
Variable(2)
|
$
|
370,635.38
|
February
2037
|
|||||
|
I-51-A
|
Variable(2)
|
$
|
354,451.99
|
February
2037
|
|||||
|
I-51-B
|
Variable(2)
|
$
|
354,451.99
|
February
2037
|
|||||
|
I-52-A
|
Variable(2)
|
$
|
339,095.73
|
February
2037
|
|||||
|
I-52-B
|
Variable(2)
|
$
|
339,095.73
|
February
2037
|
|||||
|
I-53-A
|
Variable(2)
|
$
|
324,253.20
|
February
2037
|
|||||
|
I-53-B
|
Variable(2)
|
$
|
324,253.20
|
February
2037
|
|||||
|
I-54-A
|
Variable(2)
|
$
|
4,389,299.80
|
February
2037
|
|||||
|
I-54-B
|
Variable(2)
|
$
|
4,389,299.80
|
February
2037
|
|||||
|
II
|
Variable(2)
|
$
|
79,543,618.55
|
February
2037
|
|||||
|
II-1-A
|
Variable(2)
|
$
|
7,842,091.99
|
February
2037
|
|||||
|
II-1-B
|
Variable(2)
|
$
|
7,842,091.99
|
February
2037
|
|||||
3
|
Designation
|
REMIC
I
Remittance
Rate
|
Initial
Uncertificated
Balance
|
Latest
Possible
Maturity
Date(1)
|
||||||
|
II-2-A
|
Variable(2)
|
$
|
8,379,300.36
|
February
2037
|
|||||
|
II-2-B
|
Variable(2)
|
$
|
8,379,300.36
|
February
2037
|
|||||
|
II-3-A
|
Variable(2)
|
$
|
8,822,518.43
|
February
2037
|
|||||
|
II-3-B
|
Variable(2)
|
$
|
8,822,518.43
|
February
2037
|
|||||
|
II-4-A
|
Variable(2)
|
$
|
8,458,281.96
|
February
2037
|
|||||
|
II-4-B
|
Variable(2)
|
$
|
8,458,281.96
|
February
2037
|
|||||
|
II-5-A
|
Variable(2)
|
$
|
8,109,139.54
|
February
2037
|
|||||
|
II-5-B
|
Variable(2)
|
$
|
8,109,139.54
|
February
2037
|
|||||
|
II-6-A
|
Variable(2)
|
$
|
7,774,462.64
|
February
2037
|
|||||
|
II-6-B
|
Variable(2)
|
$
|
7,774,462.64
|
February
2037
|
|||||
|
II-7-A
|
Variable(2)
|
$
|
7,453,650.74
|
February
2037
|
|||||
|
II-7-B
|
Variable(2)
|
$
|
7,453,650.74
|
February
2037
|
|||||
|
II-8-A
|
Variable(2)
|
$
|
7,146,127.26
|
February
2037
|
|||||
|
II-8-B
|
Variable(2)
|
$
|
7,146,127.26
|
February
2037
|
|||||
|
II-9-A
|
Variable(2)
|
$
|
6,851,339.60
|
February
2037
|
|||||
|
II-9-B
|
Variable(2)
|
$
|
6,851,339.60
|
February
2037
|
|||||
|
II-10-A
|
Variable(2)
|
$
|
6,568,758.75
|
February
2037
|
|||||
|
II-10-B
|
Variable(2)
|
$
|
6,568,758.75
|
February
2037
|
|||||
|
II-11-A
|
Variable(2)
|
$
|
6,297,877.64
|
February
2037
|
|||||
|
II-11-B
|
Variable(2)
|
$
|
6,297,877.64
|
February
2037
|
|||||
|
II-12-A
|
Variable(2)
|
$
|
6,052,331.19
|
February
2037
|
|||||
|
II-12-B
|
Variable(2)
|
$
|
6,052,331.19
|
February
2037
|
|||||
|
II-13-A
|
Variable(2)
|
$
|
5,800,327.76
|
February
2037
|
|||||
|
II-13-B
|
Variable(2)
|
$
|
5,800,327.76
|
February
2037
|
|||||
|
II-14-A
|
Variable(2)
|
$
|
6,143,903.87
|
February
2037
|
|||||
|
II-14-B
|
Variable(2)
|
$
|
6,143,903.87
|
February
2037
|
|||||
|
II-15-A
|
Variable(2)
|
$
|
18,689,858.25
|
February
2037
|
|||||
|
II-15-B
|
Variable(2)
|
$
|
18,689,858.25
|
February
2037
|
|||||
|
II-16-A
|
Variable(2)
|
$
|
15,544,795.50
|
February
2037
|
|||||
|
II-16-B
|
Variable(2)
|
$
|
15,544,795.50
|
February
2037
|
|||||
|
II-17-A
|
Variable(2)
|
$
|
12,960,402.34
|
February
2037
|
|||||
|
II-17-B
|
Variable(2)
|
$
|
12,960,402.34
|
February
2037
|
|||||
|
II-18-A
|
Variable(2)
|
$
|
10,564,552.49
|
February
2037
|
|||||
|
II-18-B
|
Variable(2)
|
$
|
10,564,552.49
|
February
2037
|
|||||
|
II-19-A
|
Variable(2)
|
$
|
3,151,619.58
|
February
2037
|
|||||
|
II-19-B
|
Variable(2)
|
$
|
3,151,619.58
|
February
2037
|
|||||
|
II-20-A
|
Variable(2)
|
$
|
3,009,573.95
|
February
2037
|
|||||
|
II-20-B
|
Variable(2)
|
$
|
3,009,573.95
|
February
2037
|
|||||
|
II-21-A
|
Variable(2)
|
$
|
2,874,029.15
|
February
2037
|
|||||
|
II-21-B
|
Variable(2)
|
$
|
2,874,029.15
|
February
2037
|
|||||
|
II-22-A
|
Variable(2)
|
$
|
2,744,103.28
|
February
2037
|
|||||
|
II-22-B
|
Variable(2)
|
$
|
2,744,103.28
|
February
2037
|
|||||
|
II-23-A
|
Variable(2)
|
$
|
2,620,757.53
|
February
2037
|
|||||
|
II-23-B
|
Variable(2)
|
$
|
2,620,757.53
|
February
2037
|
|||||
|
II-24-A
|
Variable(2)
|
$
|
2,503,054.34
|
February
2037
|
|||||
|
II-24-B
|
Variable(2)
|
$
|
2,503,054.34
|
February
2037
|
|||||
4
|
Designation
|
REMIC
I
Remittance
Rate
|
Initial
Uncertificated
Balance
|
Latest
Possible
Maturity
Date(1)
|
||||||
|
II-25-A
|
Variable(2)
|
$
|
2,390,728.86
|
February
2037
|
|||||
|
II-25-B
|
Variable(2)
|
$
|
2,390,728.86
|
February
2037
|
|||||
|
II-26-A
|
Variable(2)
|
$
|
2,283,537.18
|
February
2037
|
|||||
|
II-26-B
|
Variable(2)
|
$
|
2,283,537.18
|
February
2037
|
|||||
|
II-27-A
|
Variable(2)
|
$
|
2,181,233.02
|
February
2037
|
|||||
|
II-27-B
|
Variable(2)
|
$
|
2,181,233.02
|
February
2037
|
|||||
|
II-28-A
|
Variable(2)
|
$
|
2,083,446.61
|
February
2037
|
|||||
|
II-28-B
|
Variable(2)
|
$
|
2,083,446.61
|
February
2037
|
|||||
|
II-29-A
|
Variable(2)
|
$
|
1,990,279.51
|
February
2037
|
|||||
|
II-29-B
|
Variable(2)
|
$
|
1,990,279.51
|
February
2037
|
|||||
|
II-30-A
|
Variable(2)
|
$
|
1,901,355.20
|
February
2037
|
|||||
|
II-30-B
|
Variable(2)
|
$
|
1,901,355.20
|
February
2037
|
|||||
|
II-31-A
|
Variable(2)
|
$
|
1,816,478.01
|
February
2037
|
|||||
|
II-31-B
|
Variable(2)
|
$
|
1,816,478.01
|
February
2037
|
|||||
|
II-32-A
|
Variable(2)
|
$
|
1,735,460.70
|
February
2037
|
|||||
|
II-32-B
|
Variable(2)
|
$
|
1,735,460.70
|
February
2037
|
|||||
|
II-33-A
|
Variable(2)
|
$
|
1,658,124.47
|
February
2037
|
|||||
|
II-33-B
|
Variable(2)
|
$
|
1,658,124.47
|
February
2037
|
|||||
|
II-34-A
|
Variable(2)
|
$
|
1,584,288.47
|
February
2037
|
|||||
|
II-34-B
|
Variable(2)
|
$
|
1,584,288.47
|
February
2037
|
|||||
|
II-35-A
|
Variable(2)
|
$
|
1,513,814.73
|
February
2037
|
|||||
|
II-35-B
|
Variable(2)
|
$
|
1,513,814.73
|
February
2037
|
|||||
|
II-36-A
|
Variable(2)
|
$
|
1,446,536.91
|
February
2037
|
|||||
|
II-36-B
|
Variable(2)
|
$
|
1,446,536.91
|
February
2037
|
|||||
|
II-37-A
|
Variable(2)
|
$
|
1,382,305.91
|
February
2037
|
|||||
|
II-37-B
|
Variable(2)
|
$
|
1,382,305.91
|
February
2037
|
|||||
|
II-38-A
|
Variable(2)
|
$
|
1,320,983.06
|
February
2037
|
|||||
|
II-38-B
|
Variable(2)
|
$
|
1,320,983.06
|
February
2037
|
|||||
|
II-39-A
|
Variable(2)
|
$
|
1,262,433.75
|
February
2037
|
|||||
|
II-39-B
|
Variable(2)
|
$
|
1,262,433.75
|
February
2037
|
|||||
|
II-40-A
|
Variable(2)
|
$
|
1,206,529.77
|
February
2037
|
|||||
|
II-40-B
|
Variable(2)
|
$
|
1,206,529.77
|
February
2037
|
|||||
|
II-41-A
|
Variable(2)
|
$
|
1,153,151.37
|
February
2037
|
|||||
|
II-41-B
|
Variable(2)
|
$
|
1,153,151.37
|
February
2037
|
|||||
|
II-42-A
|
Variable(2)
|
$
|
1,102,181.13
|
February
2037
|
|||||
|
II-42-B
|
Variable(2)
|
$
|
1,102,181.13
|
February
2037
|
|||||
|
II-43-A
|
Variable(2)
|
$
|
1,053,509.41
|
February
2037
|
|||||
|
II-43-B
|
Variable(2)
|
$
|
1,053,509.41
|
February
2037
|
|||||
|
II-44-A
|
Variable(2)
|
$
|
1,007,030.28
|
February
2037
|
|||||
|
II-44-B
|
Variable(2)
|
$
|
1,007,030.28
|
February
2037
|
|||||
|
II-45-A
|
Variable(2)
|
$
|
962,642.85
|
February
2037
|
|||||
|
II-45-B
|
Variable(2)
|
$
|
962,642.85
|
February
2037
|
|||||
|
II-46-A
|
Variable(2)
|
$
|
920,252.33
|
February
2037
|
|||||
|
II-46-B
|
Variable(2)
|
$
|
920,252.33
|
February
2037
|
|||||
|
II-47-A
|
Variable(2)
|
$
|
879,766.28
|
February
2037
|
|||||
|
II-47-B
|
Variable(2)
|
$
|
879,766.28
|
February
2037
|
|||||
5
|
Designation
|
REMIC
I
Remittance
Rate
|
Initial
Uncertificated
Balance
|
Latest
Possible
Maturity
Date(1)
|
||||||
|
II-48-A
|
Variable(2)
|
$
|
841,098.00
|
February
2037
|
|||||
|
II-48-B
|
Variable(2)
|
$
|
841,098.00
|
February
2037
|
|||||
|
II-49-A
|
Variable(2)
|
$
|
804,165.15
|
February
2037
|
|||||
|
II-49-B
|
Variable(2)
|
$
|
804,165.15
|
February
2037
|
|||||
|
II-50-A
|
Variable(2)
|
$
|
768,887.12
|
February
2037
|
|||||
|
II-50-B
|
Variable(2)
|
$
|
768,887.12
|
February
2037
|
|||||
|
II-51-A
|
Variable(2)
|
$
|
735,314.51
|
February
2037
|
|||||
|
II-51-B
|
Variable(2)
|
$
|
735,314.51
|
February
2037
|
|||||
|
II-52-A
|
Variable(2)
|
$
|
703,457.77
|
February
2037
|
|||||
|
II-52-B
|
Variable(2)
|
$
|
703,457.77
|
February
2037
|
|||||
|
II-53-A
|
Variable(2)
|
$
|
672,666.80
|
February
2037
|
|||||
|
II-53-B
|
Variable(2)
|
$
|
672,666.80
|
February
2037
|
|||||
|
II-54-A
|
Variable(2)
|
$
|
9,105,650.20
|
February
2037
|
|||||
|
II-54-B
|
Variable(2)
|
$
|
9,105,650.20
|
February
2037
|
|||||
__________________________
|
(1)
|
For
purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
the
Distribution Date immediately following the maturity date for the
Mortgage
Loan with the latest maturity date has been designated as the “latest
possible maturity date” for each REMIC I Regular
Interest.
|
|
(2)
|
Calculated
in accordance with the definition of “REMIC I Remittance Rate”
herein.
|
6
REMIC
II
As
provided herein, the Securities Administrator will elect to treat the segregated
pool of assets consisting of the REMIC I Regular Interests as a REMIC for
federal income tax purposes, and such segregated pool of assets will be
designated as “REMIC II.” The Class R-II Interest will evidence the sole class
of “residual interests” in REMIC II for purposes of the REMIC Provisions. The
following table irrevocably sets forth the designation, the REMIC II Remittance
Rate, the initial aggregate Uncertificated Balance and, for purposes of
satisfying Treasury regulation Section 1.860G-1(a)(4)(iii), the “latest possible
maturity date” for each of the REMIC II Regular Interests. None of the REMIC II
Regular Interests will be certificated.
|
Designation
|
|
REMIC
II
Remittance
Rate
|
|
Initial
Uncertificated
Balance
|
|
Latest
Possible
Maturity
Date (1)
|
|
|||
|
AA
|
|
|
Variable(2)
|
|
$
|
384,307,997.03
|
|
|
February
2037
|
|
|
A-1
|
|
|
Variable(2)
|
|
$
|
1,019,115.00
|
|
|
February
2037
|
|
|
A-2A
|
|
|
Variable(2)
|
|
$
|
1,060,280.00
|
|
|
February
2037
|
|
|
A-2B
|
|
|
Variable(2)
|
|
$
|
405,005.00
|
|
|
February
2037
|
|
|
A-2C
|
|
|
Variable(2)
|
|
$
|
302,515.00
|
|
|
February
2037
|
|
|
A-2D
|
|
|
Variable(2)
|
|
$
|
346,370.00
|
|
|
February
2037
|
|
|
M-1
|
|
|
Variable(2)
|
|
$
|
131,370.00
|
|
|
February
2037
|
|
|
M-2
|
|
|
Variable(2)
|
|
$
|
115,685.00
|
|
|
February
2037
|
|
|
M-3
|
|
|
Variable(2)
|
|
$
|
68,625.00
|
|
|
February
2037
|
|
|
M-4
|
|
|
Variable(2)
|
|
$
|
60,785.00
|
|
|
February
2037
|
|
|
M-5
|
|
|
Variable(2)
|
|
$
|
58,825.00
|
|
|
February
2037
|
|
|
M-6
|
|
|
Variable(2)
|
|
$
|
56,860.00
|
|
|
February
2037
|
|
|
M-7
|
|
|
Variable(2)
|
|
$
|
56,860.00
|
|
|
February
2037
|
|
|
M-8
|
|
|
Variable(2)
|
|
$
|
43,135.00
|
|
|
February
2037
|
|
|
M-9
|
|
|
Variable(2)
|
|
$
|
39,215.00
|
|
|
February
2037
|
|
|
ZZ
|
|
|
Variable(2)
|
|
$
|
4,078,375.35
|
|
|
February
2037
|
|
|
P
|
|
|
Variable(2)(3)
|
|
$
|
100.00
|
|
|
February
2037
|
|
|
IO
|
|
|
Variable(2)
|
|
|
(4)
|
|
|
February
2037
|
|
|
I-SUB
|
|
|
Variable(2)
|
|
$
|
5,127.51
|
|
|
February
2037
|
|
|
I-GRP
|
|
|
Variable(2)
|
|
$
|
25,509.82
|
|
|
February
2037
|
|
|
II-SUB
|
|
|
Variable(2)
|
|
$
|
10,637.00
|
|
|
February
2037
|
|
|
II-GRP
|
|
|
Variable(2)
|
|
$
|
52,920.40
|
|
|
February
2037
|
|
|
XX
|
|
|
Variable(2)
|
|
$
|
392,056,822.66
|
|
|
February
2037
|
|
__________________________
|
(1)
|
For
purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
the
Distribution Date immediately following the maturity date for the
Mortgage
Loan with the latest maturity date has been designated as the “latest
possible maturity date” for each REMIC II Regular
Interest.
|
|
(2)
|
Calculated
in accordance with the definition of “REMIC II Remittance Rate”
herein.
|
|
(3)
|
REMIC
II Regular Interest P will be entitled to 100% of the Prepayment
Charges.
|
|
(4)
|
REMIC
II Regular Interest IO will not have an Uncertificated Balance, but
will
accrue interest on its Notional
Amount.
|
7
REMIC
III
As
provided herein, the Securities Administrator will elect to treat the segregated
pool of assets consisting of the REMIC II Regular Interests as a REMIC for
federal income tax purposes, and such segregated pool of assets will be
designated as “REMIC III.” The Class R-III Interest will evidence the sole class
of “residual interests” in REMIC III for purposes of the REMIC Provisions. The
following table irrevocably sets forth the designation, the Pass-Through Rate,
the initial aggregate Certificate Principal Balance and, for purposes of
satisfying Treasury regulation Section 1.860G-1(a)(4)(iii), the “latest possible
maturity date” for the indicated Classes of Certificates.
|
Designation
|
|
Pass-Through
Rate
|
|
Initial
Aggregate Certificate Principal Balance
|
|
Latest
Possible
Maturity
Date (1)
|
|
|||
|
Class
A-1
|
|
|
Variable(2)
|
|
$
|
203,823,000
|
|
|
February
2037
|
|
|
Class
A-2A
|
|
|
Variable(2)
|
|
$
|
212,056,000
|
|
|
February
2037
|
|
|
Class
A-2B
|
|
|
Variable(2)
|
|
$
|
81,001,000
|
|
|
February
2037
|
|
|
Class
A-2C
|
|
|
Variable(2)
|
|
$
|
60,503,000
|
|
|
February
2037
|
|
|
Class
A-2D
|
|
|
Variable(2)
|
|
$
|
69,274,000
|
|
|
February
2037
|
|
|
Class
M-1
|
|
|
Variable(2)
|
|
$
|
26,274,000
|
|
|
February
2037
|
|
|
Class
M-2
|
|
|
Variable(2)
|
|
$
|
23,137,000
|
|
|
February
2037
|
|
|
Class
M-3
|
|
|
Variable(2)
|
|
$
|
13,725,000
|
|
|
February
2037
|
|
|
Class
M-4
|
|
|
Variable(2)
|
|
$
|
12,157,000
|
|
|
February
2037
|
|
|
Class
M-5
|
|
|
Variable(2)
|
|
$
|
11,765,000
|
|
|
February
2037
|
|
|
Class
M-6
|
|
|
Variable(2)
|
|
$
|
11,372,000
|
|
|
February
2037
|
|
|
Class
M-7
|
|
|
Variable(2)
|
|
$
|
11,372,000
|
|
|
February
2037
|
|
|
Class
M-8
|
|
|
Variable(2)
|
|
$
|
8,627,000
|
|
|
February
2037
|
|
|
Class
M-9
|
|
|
Variable(2)
|
|
$
|
7,843,000
|
|
|
February
2037
|
|
|
Class
P
|
|
|
N/A(3)
|
|
$
|
100.00
|
|
|
February
2037
|
|
|
Class
CE
|
|
|
(4)
|
|
$
|
31,373,034.76
|
|
|
February
2037
|
|
|
Class
IO Interest
|
|
|
(5)
|
|
|
(5)
|
|
|
February
2037
|
|
__________________________
|
(1)
|
For
purposes of Section 1.860G-1(a)(4)(iii) of the Treasury regulations,
the
Distribution Date immediately following the maturity date for the
Mortgage
Loan with the latest maturity date has been designated as the “latest
possible maturity date” for each Class of
Certificates.
|
8
|
(2)
|
Calculated
in accordance with the definition of “Pass-Through Rate”
herein.
|
|
(3)
|
The
Class P Certificates will not accrue
interest.
|
|
(4)
|
The
Class CE Certificates will accrue interest at their variable Pass-Through
Rate on the Notional Amount of the Class CE Certificates outstanding
from
time to time which shall equal the Uncertificated Balance of the
REMIC II
Regular Interests (other than REMIC II Regular Interest P). The Class
CE
Certificates will not accrue interest on their Certificate Principal
Balance.
|
|
(5)
|
The
Class IO Interest will not have a Pass-Through Rate or a Certificate
Principal Balance, but will be entitled to 100% of amounts distributed
on
REMIC II Regular Interest IO.
|
The
Mortgage Loans had an aggregate Scheduled Principal Balance as of the Cut-off
Date, after deducting all Monthly Payments due on or before the Cut-off Date,
of
$784,302,134.76. As of the Cut-off Date, the Group I Mortgage Loans had an
aggregate Scheduled Principal Balance equal to $255,098,181.14 and the Group
II
Mortgage Loans had an aggregate Scheduled Principal Balance equal to
$529,203,953.62.
9
In
consideration of the mutual agreements herein contained, the Depositor, the
Servicer, the Master Servicer, the Securities Administrator and the Trustee
agree as follows:
ARTICLE
I
DEFINITIONS
SECTION
1.01. Defined
Terms.
Whenever
used in this Agreement, including, without limitation, in the Preliminary
Statement hereto, the following words and phrases, unless the context otherwise
requires, shall have the meanings specified in this Article. Unless otherwise
specified, all calculations described herein shall be made on the basis of
a
360-day year consisting of twelve 30-day months.
“Accepted
Master Servicing Practices”:
With
respect to any Mortgage Loan, as applicable, either (x) those customary mortgage
master servicing practices of prudent mortgage servicing institutions that
master service mortgage loans of the same type and quality as such Mortgage
Loan
in the jurisdiction where the related Mortgaged Property is located, to the
extent applicable to the Master Servicer (except in its capacity as successor
to
the Servicer), or (y) as provided in Section 3.01 hereof, but in no event below
the standard set forth in clause (x).
“Accepted
Servicing Practices”:
As
defined in Section 3.01.
“Account”:
The
Collection Account and the Distribution Account as the context may
require.
“Accrued
Certificate Interest”:
With
respect to any Class A Certificate, Mezzanine Certificate or Class CE
Certificate and each Distribution Date, interest accrued during the related
Interest Accrual Period at the Pass-Through Rate for such Certificate for such
Distribution Date on the Certificate Principal Balance, in the case of the
Class
A Certificates and the Mezzanine Certificates, or on the Notional Amount in
the
case of the Class CE Certificates, of such Certificate immediately prior to
such
Distribution Date. The Class P Certificates are not entitled to distributions
in
respect of interest and, accordingly, will not accrue interest. All
distributions of interest on the Class A Certificates and the Mezzanine
Certificates will be calculated on the basis of a 360-day year and the actual
number of days in the applicable Interest Accrual Period. All distributions
of
interest on the Class CE Certificates will be based on a 360-day year consisting
of twelve 30-day months. Accrued Certificate Interest with respect to each
Distribution Date, as to any Class A Certificate, Mezzanine Certificate or
Class
CE Certificate shall be reduced by an amount equal to the portion allocable
to
such Certificate pursuant to Section 1.02 hereof, if any, of the sum of (a)
the
aggregate Prepayment Interest Shortfall, if any, for such Distribution Date
to
the extent not covered by payments pursuant to Section 3.23 or Section 4.19
of
this Agreement and (b) the aggregate amount of any Relief Act Interest
Shortfall, if any, for such Distribution Date. In addition, Accrued Certificate
Interest with respect to each Distribution Date, as to any Class CE Certificate,
shall be reduced by an amount equal to the portion allocable to such Class
CE
Certificate of Realized Losses, if any, pursuant to Section 1.02 and Section
5.04 hereof.
10
“Additional
Disclosure Notification”:
Has
the meaning set forth in Section 5.06(a).
“Additional
Form 10-D Disclosure”:
Has
the meaning set forth in Section 5.06(a) of this Agreement.
“Additional
Form 10-K Disclosure”:
Has
the meaning set forth in Section 5.06(d) of this Agreement.
“Additional
Servicer”:
Means
each affiliate of the Servicer that Services any of the Mortgage Loans and
each
Person who is not an affiliate of the Servicer. For clarification purposes,
the
Master Servicer and the Securities Administrator are Additional
Servicers.
“Adjustable
Rate Mortgage Loan”:
Each
of the Mortgage Loans identified in the Mortgage Loan Schedule as having a
Mortgage Rate that is subject to adjustment.
“Adjustment
Date”:
With
respect to each Adjustable Rate Mortgage Loan, the first day of the month in
which the Mortgage Rate of an Adjustable Rate Mortgage Loan changes pursuant
to
the related Mortgage Note. The first Adjustment Date following the Cut-off
Date
as to each Adjustable Rate Mortgage Loan is set forth in the Mortgage Loan
Schedule.
“Administration
Fees”:
The
sum of (i) the Servicing Fee, (ii) the Master Servicing Fee and (iii) the Credit
Risk Management Fee.
“Administration
Fee Rate”:
The
sum of (i) the Servicing Fee Rate, (ii) the Master Servicing Fee Rate and (iii)
the Credit Risk Management Fee Rate.
“Advance
Facility”:
As
defined in Section 3.26(a).
“Advance
Financing Person”:
As
defined in Section 3.26(a).
“Advance
Reimbursement Amounts”:
As
defined in Section 3.26(b).
“Affiliate”:
With
respect to any specified Person, any other Person controlling or controlled by
or under common control with such specified Person. For the purposes of this
definition, “control” when used with respect to any specified Person means the
power to direct the management and policies of such Person, directly or
indirectly, whether through the ownership of voting securities, by contract
or
otherwise, and the terms “controlling” and “controlled” have meanings
correlative to the foregoing.
“Aggregate
Loss Severity Percentage”:
With
respect to any Distribution Date, the percentage equivalent of a fraction,
the
numerator of which is the aggregate amount of Realized Losses incurred on any
Mortgage Loans from the Cut-off Date to the last day of the preceding calendar
month and the denominator of which is the aggregate principal balance of such
Mortgage Loans immediately prior to the liquidation of such Mortgage
Loans.
“Agreement”:
This
Pooling and Servicing Agreement, including all exhibits and schedules hereto
and
all amendments hereof and supplements hereto.
11
“Allocated
Realized Loss Amount”:
With
respect to any Class of Mezzanine Certificates and any Distribution Date, an
amount equal to the sum of any Realized Loss allocated to that Class of
Certificates on the Distribution Date and any Allocated Realized Loss Amount
for
that Class remaining unpaid from the previous Distribution Date.
“Amounts
Held for Future Distribution”:
As to
any Distribution Date, the aggregate amount held in the Collection Account
at
the close of business on the immediately preceding Determination Date on account
of (i) all Monthly Payments or portions thereof received in respect of the
Mortgage Loans due after the related Due Period and (ii) Principal Prepayments
and Liquidation Proceeds received in respect of such Mortgage Loans after the
last day of the related Prepayment Period.
“Ancillary
Income”:
All
income derived from the Mortgage Loans, other than Servicing Fees and Prepayment
Charges, including but not limited to, late charges, fees received with respect
to checks or bank drafts returned by the related bank for non sufficient funds,
assumption fees, optional insurance administrative fees and all other incidental
fees and charges.
“Assignment”:
An
assignment of Mortgage, notice of transfer or equivalent instrument, in
recordable form, which is sufficient under the laws of the jurisdiction where
the related Mortgaged Property is located to reflect of record the sale and
assignment of the Mortgage, which assignment, notice of transfer or equivalent
instrument may be in the form of one or more blanket assignments covering
Mortgages secured by Mortgaged Properties located in the same county, if
permitted by law.
“Authorized
Officers”:
A
managing director of the whole loan trading desk and a managing director in
global markets.
“Available
Distribution Amount”:
With
respect to any Distribution Date, an amount equal to (1) the sum of (a) the
aggregate of the amounts on deposit in the Collection Account and the
Distribution Account as of the close of business on the Servicer Remittance
Date, (b) the aggregate of any amounts deposited in the Distribution Account
by
the Servicer or the Master Servicer in respect of Prepayment Interest Shortfalls
for such Distribution Date pursuant to Section 3.23 or Section 4.19 of this
Agreement, (c) the aggregate of any P&I Advances for such Distribution Date
made by the Servicer pursuant to Section 5.03 of this Agreement and (d) the
aggregate of any P&I Advances made by a successor Servicer (including the
Master Servicer) for such Distribution Date pursuant to Section 8.02 of this
Agreement, reduced (to an amount not less than zero) by (2) the portion of
the
amount described in clause (1)(a) above that represents (i) Amounts Held for
Future Distribution, (ii) Principal Prepayments on the Mortgage Loans received
after the related Prepayment Period (together with any interest payments
received with such Principal Prepayments to the extent they represent the
payment of interest accrued on the Mortgage Loans during a period subsequent
to
the related Prepayment Period), (iii) Liquidation Proceeds, Insurance Proceeds
and Subsequent Recoveries received in respect of the Mortgage Loans after the
related Prepayment Period, (iv) amounts reimbursable or payable to the
Depositor, the Servicer, the Trustee, the Master Servicer, the Securities
Administrator, the Credit Risk Manager or the Custodian pursuant to Section
3.09
or 9.05 of this Agreement or otherwise payable in respect of Extraordinary
Trust
Fund Expenses, (v) the Credit Risk Management Fee, (vi) amounts deposited in
the
Collection Account or the Distribution Account in error, (vii) the amount of
any
Prepayment Charges collected by the Servicer in connection with the Principal
Prepayment of any of the Mortgage Loans and (viii) amounts reimbursable to
a
successor Servicer (including the Master Servicer) pursuant to Section 8.02
of
this Agreement.
12
“Balloon
Mortgage Loan”:
A
Mortgage Loan that provides for the payment of the unamortized principal balance
of such Mortgage Loan in a single payment, that is substantially greater than
the preceding monthly payment at the maturity of such Mortgage
Loan.
“Balloon
Payment”:
A
payment of the unamortized principal balance of a Mortgage Loan in a single
payment, that is substantially greater than the preceding Monthly Payment at
the
maturity of such Mortgage Loan.
“Bankruptcy
Code”:
The
Bankruptcy Reform Act of 1978 (Title 11 of the United States Code), as
amended.
“Book-Entry
Certificates”:
The
Offered Certificates for so long as the Certificates of such Class shall be
registered in the name of the Depository or its nominee.
“Book-Entry
Custodian”:
The
custodian appointed pursuant to Section 6.01.
“Business
Day”:
Any
day other than a Saturday, a Sunday or a day on which banking or savings and
loan institutions in the States of New York, Maryland, Minnesota, Florida or
in
the city in which the Corporate Trust Office of the Trustee is located, are
authorized or obligated by law or executive order to be closed.
“Cap
Contracts”:
Shall
mean the Group I Cap Contract and Group II Cap Contract.
“Cap
Counterparty”:
The
counterparty under each Cap Contract. Initially, the Cap Counterparty shall
be
Deutsche Bank AG, New York Branch.
“Cash-Out
Refinancing”:
A
Refinanced Mortgage Loan the proceeds of which are more than a nominal amount
in
excess of the principal balance of any existing first mortgage plus any
subordinate mortgage on the related Mortgaged Property and related closing
costs.
“Certificate”:
Any
one of ACE Securities Corp., Asset Backed Pass-Through Certificates, Series
2007-WM2, Class X-0, Xxxxx X-0X, Xxxxx X-0X, Class A-2C, Class A-2D, Class
M-1,
Class M-2, Class M-3, Class M-4, Class M-5, Class M-6, Class M-7, Class M-8,
Class M-9, Class P, Class CE and Class R Certificates issued under this
Agreement.
“Certificate
Factor”:
With
respect to any Class of Certificates (other than the Residual Certificates)
as
of any Distribution Date, a fraction, expressed as a decimal carried to six
places, the numerator of which is the aggregate Certificate Principal Balance
(or Notional Amount, in the case of the Class CE Certificates) of such Class
of
Certificates on such Distribution Date (after giving effect to any distributions
of principal and allocations of Realized Losses resulting in reduction of the
Certificate Principal Balance (or Notional Amount, in the case of the Class
CE
Certificates) of such Class of Certificates to be made on such Distribution
Date), and the denominator of which is the initial aggregate Certificate
Principal Balance (or Notional Amount, in the case of the Class CE Certificates)
of such Class of Certificates as of the Closing Date.
13
“Certificate
Margin”:
With
respect to the Class A-1 Certificates and, for purposes of the definition of
“Marker Rate”, REMIC II Regular Interest A-1, 0.21% in the case of each
Distribution Date through and including the Optional Termination Date and 0.42%
in the case of each Distribution Date thereafter.
With
respect to the Class A-2A Certificates and, for purposes of the definition
of
“Marker Rate”, REMIC II Regular Interest A-2A, 0.12% in the case of each
Distribution Date through and including the Optional Termination Date and 0.24%
in the case of each Distribution Date thereafter.
With
respect to the Class A-2B Certificates and, for purposes of the definition
of
“Marker Rate”, REMIC II Regular Interest A-2B, 0.18% in the case of each
Distribution Date through and including the Optional Termination Date and 0.36%
in the case of each Distribution Date thereafter.
With
respect to the Class A-2C Certificates and, for purposes of the definition
of
“Marker Rate”, REMIC II Regular Interest A-2C, 0.28% in the case of each
Distribution Date through and including the Optional Termination Date and 0.56%
in the case of each Distribution Date thereafter.
With
respect to the Class A-2D Certificates and, for purposes of the definition
of
“Marker Rate”, REMIC II Regular Interest A-2D, 0.37% in the case of each
Distribution Date through and including the Optional Termination Date and 0.74%
in the case of each Distribution Date thereafter.
With
respect to the Class M-1 Certificates and, for purposes of the definition of
“Marker Rate”, REMIC II Regular Interest M-1, 0.55% in the case of each
Distribution Date through and including the Optional Termination Date and 0.825%
in the case of each Distribution Date thereafter.
With
respect to the Class M-2 Certificates and, for purposes of the definition of
“Marker Rate”, REMIC II Regular Interest M-2, 0.75% in the case of each
Distribution Date through and including the Optional Termination Date and 1.125%
in the case of each Distribution Date thereafter.
With
respect to the Class M-3 Certificates and, for purposes of the definition of
“Marker Rate”, REMIC II Regular Interest M-3, 0.85% in the case of each
Distribution Date through and including the Optional Termination Date and 1.275%
in the case of each Distribution Date thereafter.
With
respect to the Class M-4 Certificates and, for purposes of the definition of
“Marker Rate”, REMIC II Regular Interest M-4, 1.70% in the case of each
Distribution Date through and including the Optional Termination Date and 2.20%
in the case of each Distribution Date thereafter.
14
With
respect to the Class M-5 Certificates and, for purposes of the definition of
“Marker Rate”, REMIC II Regular Interest M-5, 2.20% in the case of each
Distribution Date through and including the Optional Termination Date and 2.70%
in the case of each Distribution Date thereafter.
With
respect to the Class M-6 Certificates and, for purposes of the definition of
“Marker Rate”, REMIC II Regular Interest M-6, 2.50% in the case of each
Distribution Date through and including the Optional Termination Date and 3.00%
in the case of each Distribution Date thereafter.
With
respect to the Class M-7 Certificates and, for purposes of the definition of
“Marker Rate”, REMIC II Regular Interest M-7, 2.50% in the case of each
Distribution Date through and including the Optional Termination Date and 3.00%
in the case of each Distribution Date thereafter.
With
respect to the Class M-8 Certificates and, for purposes of the definition of
“Marker Rate”, REMIC II Regular Interest 2.50% in the case of each Distribution
Date through and including the Optional Termination Date and 3.00% in the case
of each Distribution Date thereafter.
With
respect to the Class M-9 Certificates and, for purposes of the definition of
“Marker Rate”, REMIC II Regular Interest M-9, 2.50% in the case of each
Distribution Date through and including the Optional Termination Date and 3.00%
in the case of each Distribution Date thereafter.
“Certificateholder”
or
“Holder”:
The
Person in whose name a Certificate is registered in the Certificate Register,
except that a Disqualified Organization or a Non-United States Person shall
not
be a Holder of a Residual Certificate for any purposes hereof, and solely for
the purposes of giving any consent pursuant to this Agreement, any Certificate
registered in the name of or beneficially owned by the Depositor, the Sponsor,
the Servicer, the Master Servicer, the Securities Administrator, the Trustee
or
any Affiliate thereof shall be deemed not to be outstanding and the Voting
Rights to which it is entitled shall not be taken into account in determining
whether the requisite percentage of Voting Rights necessary to effect any such
consent has been obtained, except as otherwise provided in Section 12.01. The
Trustee and the Securities Administrator may conclusively rely upon a
certificate of the Depositor, the Sponsor, the Master Servicer, the Securities
Administrator or the Servicer in determining whether a Certificate is held
by an
Affiliate thereof. All references herein to “Holders” or “Certificateholders”
shall reflect the rights of Certificate Owners as they may indirectly exercise
such rights through the Depository and participating members thereof, except
as
otherwise specified herein; provided, however, that the Trustee and the
Securities Administrator shall be required to recognize as a “Holder” or
“Certificateholder” only the Person in whose name a Certificate is registered in
the Certificate Register.
“Certificate
Owner”:
With
respect to a Book-Entry Certificate, the Person who is the beneficial owner
of
such Certificate as reflected on the books of the Depository or on the books
of
a Depository Participant or on the books of an indirect participating brokerage
firm for which a Depository Participant acts as agent.
15
“Certificate
Principal Balance”:
With
respect to each Class A Certificate, Mezzanine Certificate or Class P
Certificate as of any date of determination, the Certificate Principal Balance
of such Certificate on the Distribution Date immediately prior to such date
of
determination plus any Subsequent Recoveries added to the Certificate Principal
Balance of such Certificate (other than a Class P Certificate) pursuant to
Section 5.04, minus (i) all distributions allocable to principal made thereon
and (ii) Realized Losses allocated thereto, if any, on such immediately prior
Distribution Date (or, in the case of any date of determination up to and
including the first Distribution Date, the initial Certificate Principal Balance
of such Certificate, as stated on the face thereof). With respect to each Class
CE Certificate as of any date of determination, an amount equal to the
Percentage Interest evidenced by such Certificate times the excess, if any,
of
(A) the then aggregate Uncertificated Balances of the REMIC II Regular Interests
over (B) the then aggregate Certificate Principal Balances of the Class A
Certificates, the Mezzanine Certificates and the Class P Certificates then
outstanding. The aggregate initial Certificate Principal Balance of each Class
of Regular Certificates is set forth in the Preliminary Statement
hereto.
“Certificate
Register”:
The
register maintained pursuant to Section 6.02.
“Certification
Parties”:
Has
the meaning set forth in Section 3.20 of this Agreement.
“Certifying
Person”:
Has
the meaning set forth in Section 3.20 of this Agreement.
“Class”:
Collectively, all of the Certificates bearing the same class
designation.
“Class
A Certificate”:
Any
Class A-1, Class A-2A, Class A-2B, Class A-2C or Class A-2D
Certificate.
“Class
A Principal Distribution Amount”:
The
Class A Principal Distribution Amount is an amount equal to the sum of: (i)
the
Class A-1 Principal Distribution Amount and (ii) the Class A-2 Principal
Distribution Amount.
“Class
A-1 Allocation Percentage”:
With
respect to any Distribution Date is the percentage equivalent of a fraction,
the
numerator of which is (x) the Group I Principal Remittance Amount for such
Distribution Date and the denominator of which is (y) the Principal Remittance
Amount for such Distribution Date.
“Class
A-1 Certificate”:
Any
one of the Class A-1 Certificates executed and authenticated by the Securities
Administrator and delivered by the Trustee, substantially in the form annexed
hereto as Exhibit A-1 and evidencing (i) a Regular Interest in REMIC III, (ii)
the right to receive the related Net WAC Rate Carryover Amount and (iii) the
obligation to pay any Class IO Distribution Amount.
“Class
A-1 Principal Distribution Amount”:
With
respect to any Distribution Date on or after the Stepdown Date and on which
a
Trigger Event is not in effect, the excess of (x) the Certificate Principal
Balance of the Class A-1 Certificates immediately prior to such Distribution
Date over (y) the lesser of (A) the product of (i) 59.80% and (ii) the aggregate
Stated Principal Balance of the Group I Mortgage Loans as of the last day of
the
related Due Period (after giving effect to scheduled payments of principal
due
during the related Due Period, to the extent received or advanced and
unscheduled collections of principal received during the related Prepayment
Period) and (B) the aggregate Stated Principal Balance of the Group I Mortgage
Loans as of the last day of the related Due Period (after giving effect to
scheduled payments of principal due during the related Due Period, to the extent
received or advanced and unscheduled collections of principal received during
the related Prepayment Period) minus the product of (i) 0.50% and (ii) the
aggregate principal balance of the Group I Mortgage Loans as of the Cut-off
Date.
16
“Class
A-2 Allocation Percentage”: With respect to any Distribution Date is the
percentage equivalent of a fraction, the numerator of which is (x) the Group
II
Principal Remittance Amount for such Distribution Date and the denominator
of
which is (y) the Principal Remittance Amount for such Distribution
Date.
“Class
A-2 Certificate”: Any Class A-2A, Class A-2B, Class A-2C or Class A-2D
Certificate.
“Class
A-2 Principal Distribution Amount”: With respect to any Distribution Date on or
after the Stepdown Date and on which a Trigger Event is not in effect, the
excess of (x) the sum of the Certificate Principal Balances of the Class A-2A,
Class A-2B, Class A-2C and Class A-2D Certificates immediately prior to such
Distribution Date over (y) the lesser of (A) the product of (i) 59.80% and
(ii)
the aggregate Stated Principal Balance of the Group II Mortgage Loans as of
the
last day of the related Due Period (after giving effect to scheduled payments
of
principal due during the related Due Period, to the extent received or advanced
and unscheduled collections of principal received during the related Prepayment
Period) and (B) the aggregate Stated Principal Balance of the Group II Mortgage
Loans as of the last day of the related Due Period (after giving effect to
scheduled payments of principal due during the related Due Period, to the extent
received or advanced and unscheduled collections of principal received during
the related Prepayment Period) minus the product of (i) 0.50% and (ii) the
aggregate principal balance of the Group II Mortgage Loans as of the Cut-off
Date.
“Class
A-2A Certificate”: Any one of the Class A-2A Certificates executed and
authenticated by the Securities Administrator and delivered by the Trustee,
substantially in the form annexed hereto as Exhibit A-1 and evidencing (i)
a
Regular Interest in REMIC III, (ii) the right to receive the related Net WAC
Rate Carryover Amount and (iii) the obligation to pay any Class IO Distribution
Amount.
“Class
A-2B Certificate”: Any one of the Class A-2B Certificates executed and
authenticated by the Securities Administrator and delivered by the Trustee,
substantially in the form annexed hereto as Exhibit A-1 and evidencing (i)
a
Regular Interest in REMIC III, (ii) the right to receive the related Net WAC
Rate Carryover Amount and (iii) the obligation to pay any Class IO Distribution
Amount.
“Class
A-2C Certificate”: Any one of the Class A-2C Certificates executed and
authenticated by the Securities Administrator and delivered by the Trustee,
substantially in the form annexed hereto as Exhibit A-1 and evidencing (i)
a
Regular Interest in REMIC III, (ii) the right to receive the related Net WAC
Rate Carryover Amount and (iii) the obligation to pay any Class IO Distribution
Amount.
17
“Class
A-2D Certificate”: Any one of the Class A-2D Certificates executed and
authenticated by the Securities Administrator and delivered by the Trustee,
substantially in the form annexed hereto as Exhibit A-1 and evidencing (i)
a
Regular Interest in REMIC III, (ii) the right to receive the related Net WAC
Rate Carryover Amount and (iii) the obligation to pay any Class IO Distribution
Amount.
“Class
CE Certificate”:
Any
one of the Class CE Certificates executed and authenticated by the Securities
Administrator and delivered by the Trustee, substantially in the form annexed
hereto as Exhibit A-3 and evidencing (i) a Regular Interest in REMIC III, (ii)
beneficial ownership of the Reserve Fund and (iii) beneficial ownership of
the
Supplemental Interest Trust.
“Class
IO Distribution Amount”:
As defined in Section 5.07(f) hereof. For
purposes of clarity, the Class IO Distribution Amount for any Distribution
Date
shall equal the amount payable to the Supplemental Interest Trust on such
Distribution Date in excess of the amount payable on the Class IO Interest
on
such Distribution Date, all as further provided in Section 5.07(f)
hereof.
“Class
IO Interest”:
An
uncertificated interest in the Trust Fund held by the Trustee, evidencing a
REMIC Regular Interest in REMIC III for purposes of the REMIC
Provisions.
“Class
M-1 Certificate”:
Any
one of the Class M-1 Certificates executed and authenticated by the Securities
Administrator and delivered by the Trustee, substantially in the form annexed
hereto as Exhibit A-2 and evidencing (i) a Regular Interest in REMIC III, (ii)
the right to receive the related Net WAC Rate Carryover Amount and (iii) the
obligation to pay any Class IO Distribution Amount.
“Class
M-1 Principal Distribution Amount”:
With
respect to any Distribution Date on or after the Stepdown Date and on which
a
Trigger Event is not in effect, the excess of (x) the sum of (i) the aggregate
Certificate Principal Balance of the Class A Certificates after taking into
account the payment of the Class A Principal Distribution Amount on the
Distribution Date and (ii) the Certificate Principal Balance of the Class M-1
Certificates immediately prior to the Distribution Date over (y) the lesser
of
(A) the product of (i) 66.50% and (ii) the aggregate Stated Principal Balance
of
the Mortgage Loans as of the last day of the related Due Period (after giving
effect to scheduled payments of principal due during the related Due Period,
to
the extent received or advanced, and unscheduled collections of principal
received during the related Prepayment Period) and (B) the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the related Due
Period (after giving effect to scheduled payments of principal due during the
related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period) minus
the product of (i) 0.50% and (ii) the aggregate principal balance of the
Mortgage Loans as of the Cut-off Date.
18
“Class
M-2 Certificate”:
Any
one of the Class M-2 Certificates executed and authenticated by the Securities
Administrator and delivered by the Trustee, substantially in the form annexed
hereto as Exhibit A-2 and evidencing (i) a Regular Interest in REMIC III, (ii)
the right to receive the related Net WAC Rate Carryover Amount and (iii) the
obligation to pay any Class IO Distribution Amount.
“Class
M-2 Principal Distribution Amount”:
With
respect to any Distribution Date on or after the Stepdown Date and on which
a
Trigger Event is not in effect, the excess of (x) the sum of (i) the aggregate
Certificate Principal Balance of the Class A Certificates after taking into
account the payment of the Class A Principal Distribution Amount on the
Distribution Date, (ii) the Certificate Principal Balance of the Class M-1
Certificates after taking into account the payment of the Class M-1 Principal
Distribution Amount on the Distribution Date and (iii) the Certificate Principal
Balance of the Class M-2 Certificates immediately prior to the Distribution
Date
over (y) the lesser of (A) the product of (i) 72.40% and (ii) the aggregate
Stated Principal Balance of the Mortgage Loans as of the last day of the related
Due Period (after giving effect to scheduled payments of principal due during
the related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period) and
(B)
the aggregate Stated Principal Balance of the Mortgage Loans as of the last
day
of the related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period) minus the product of (i) 0.50% and (ii) the aggregate principal balance
of the Mortgage Loans as of the Cut-off Date.
“Class
M-3 Certificate”:
Any
one of the Class M-3 Certificates executed and authenticated by the Securities
Administrator and delivered by the Trustee, substantially in the form annexed
hereto as Exhibit A-2 and evidencing (i) a Regular Interest in REMIC III, (ii)
the right to receive the related Net WAC Rate Carryover Amount and (iii) the
obligation to pay any Class IO Distribution Amount.
“Class
M-3 Principal Distribution Amount”:
With
respect to any Distribution Date on or after the Stepdown Date and on which
a
Trigger Event is not in effect, the excess of (x) the sum of (i) the aggregate
Certificate Principal Balance of the Class A Certificates after taking into
account the payment of the Class A Principal Distribution Amount on the
Distribution Date, (ii) the Certificate Principal Balance of the Class M-1
Certificates after taking into account the payment of the Class M-1 Principal
Distribution Amount on the Distribution Date, (iii) the Certificate Principal
Balance of the Class M-2 Certificates after taking into account the payment
of
the Class M-2 Principal Distribution Amount on the Distribution Date and (iv)
the Certificate Principal Balance of the Class M-3 Certificates immediately
prior to the Distribution Date over (y) the lesser of (A) the product of (i)
75.90% and (ii) the aggregate Stated Principal Balance of the Mortgage Loans
as
of the last day of the related Due Period (after giving effect to scheduled
payments of principal due during the related Due Period, to the extent received
or advanced, and unscheduled collections of principal received during the
related Prepayment Period) and (B) the aggregate Stated Principal Balance of
the
Mortgage Loans as of the last day of the related Due Period (after giving effect
to scheduled payments of principal due during the related Due Period, to the
extent received or advanced, and unscheduled collections of principal received
during the related Prepayment Period) minus the product of (i) 0.50% and (ii)
the aggregate principal balance of the Mortgage Loans as of the Cut-off Date.
19
“Class
M-4 Certificate”:
Any
one of the Class M-4 Certificates executed and authenticated by the Securities
Administrator and delivered by the Trustee, substantially in the form annexed
hereto as Exhibit A-2 and evidencing (i) a Regular Interest in REMIC III, (ii)
the right to receive the related Net WAC Rate Carryover Amount and (iii) the
obligation to pay any Class IO Distribution Amount.
“Class
M-4 Principal Distribution Amount”:
With
respect to any Distribution Date on or after the Stepdown Date and on which
a
Trigger Event is not in effect, the excess of (x) the sum of (i) the aggregate
Certificate Principal Balance of the Class A Certificates after taking into
account the payment of the Class A Principal Distribution Amount on the
Distribution Date, (ii) the Certificate Principal Balance of the Class M-1
Certificates after taking into account the payment of the Class M-1 Principal
Distribution Amount on the Distribution Date, (iii) the Certificate Principal
Balance of the Class M-2 Certificates after taking into account the payment
of
the Class M-2 Principal Distribution Amount on the Distribution Date, (iv)
the
Certificate Principal Balance of the Class M-3 Certificates after taking into
account the payment of the Class M-3 Principal Distribution Amount on the
Distribution Date and (v) the Certificate Principal Balance of the Class M-4
Certificates immediately prior to the Distribution Date over (y) the lesser
of
(A) the product of (i) 79.00% and (ii) the aggregate Stated Principal Balance
of
the Mortgage Loans as of the last day of the related Due Period (after giving
effect to scheduled payments of principal due during the related Due Period,
to
the extent received or advanced, and unscheduled collections of principal
received during the related Prepayment Period) and (B) the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the related Due
Period (after giving effect to scheduled payments of principal due during the
related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period) minus
the product of (i) 0.50% and (ii) the aggregate principal balance of the
Mortgage Loans as of the Cut-off Date.
“Class
M-5 Certificate”:
Any
one of the Class M-5 Certificates executed and authenticated by the Securities
Administrator and delivered by the Trustee, substantially in the form annexed
hereto as Exhibit A-2 and evidencing (i) a Regular Interest in REMIC III, (ii)
the right to receive the related Net WAC Rate Carryover Amount and (iii) the
obligation to pay any Class IO Distribution Amount.
“Class
M-5 Principal Distribution Amount”:
With
respect to any Distribution Date on or after the Stepdown Date and on which
a
Trigger Event is not in effect, the excess of (x) the sum of (i) the aggregate
Certificate Principal Balance of the Class A Certificates after taking into
account the payment of the Class A Principal Distribution Amount on the
Distribution Date, (ii) the Certificate Principal Balance of the Class M-1
Certificates after taking into account the payment of the Class M-1 Principal
Distribution Amount on the Distribution Date, (iii) the Certificate Principal
Balance of the Class M-2 Certificates after taking into account the payment
of
the Class M-2 Principal Distribution Amount on the Distribution Date, (iv)
the
Certificate Principal Balance of the Class M-3 Certificates after taking into
account the payment of the Class M-3 Principal Distribution Amount on the
Distribution Date, (v) the Certificate Principal Balance of the Class M-4
Certificates after taking into account the payment of the Class M-4 Principal
Distribution Amount on the Distribution Date and (vi) the Certificate Principal
Balance of the Class M-5 Certificates immediately prior to the Distribution
Date
over (y) the lesser of (A) the product of (i) 82.00% and (ii) the aggregate
Stated Principal Balance of the Mortgage Loans as of the last day of the related
Due Period (after giving effect to scheduled payments of principal due during
the related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period) and
(B)
the aggregate Stated Principal Balance of the Mortgage Loans as of the last
day
of the related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period) minus the product of (i) 0.50% and (ii) the aggregate principal balance
of the Mortgage Loans as of the Cut-off Date.
20
“Class
M-6 Certificate”:
Any
one of the Class M-6 Certificates executed and authenticated by the Securities
Administrator and delivered by the Trustee, substantially in the form annexed
hereto as Exhibit A-2 and evidencing (i) a Regular Interest in REMIC III, (ii)
the right to receive the related Net WAC Rate Carryover Amount and (iii) the
obligation to pay any Class IO Distribution Amount.
“Class
M-6 Principal Distribution Amount”:
With
respect to any Distribution Date on or after the Stepdown Date and on which
a
Trigger Event is not in effect, the excess of (x) the sum of (i) the aggregate
Certificate Principal Balance of the Class A Certificates after taking into
account the payment of the Class A Principal Distribution Amount on the
Distribution Date, (ii) the Certificate Principal Balance of the Class M-1
Certificates after taking into account the payment of the Class M-1 Principal
Distribution Amount on the Distribution Date, (iii) the Certificate Principal
Balance of the Class M-2 Certificates after taking into account the payment
of
the Class M-2 Principal Distribution Amount on the Distribution Date, (iv)
the
Certificate Principal Balance of the Class M-3 Certificates after taking into
account the payment of the Class M-3 Principal Distribution Amount on the
Distribution Date, (v) the Certificate Principal Balance of the Class M-4
Certificates after taking into account the payment of the Class M-4 Principal
Distribution Amount on the Distribution Date, (vi) the Certificate Principal
Balance of the Class M-5 Certificates after taking into account the payment
of
the Class M-5 Principal Distribution Amount on the Distribution Date and (vii)
the Certificate Principal Balance of the Class M-6 Certificates immediately
prior to the Distribution Date over (y) the lesser of (A) the product of (i)
84.90% and (ii) the aggregate Stated Principal Balance of the Mortgage Loans
as
of the last day of the related Due Period (after giving effect to scheduled
payments of principal due during the related Due Period, to the extent received
or advanced, and unscheduled collections of principal received during the
related Prepayment Period) and (B) the aggregate Stated Principal Balance of
the
Mortgage Loans as of the last day of the related Due Period (after giving effect
to scheduled payments of principal due during the related Due Period, to the
extent received or advanced, and unscheduled collections of principal received
during the related Prepayment Period) minus the product of (i) 0.50% and (ii)
the aggregate principal balance of the Mortgage Loans as of the Cut-off
Date.
“Class
M-7 Certificate”:
Any
one of the Class M-7 Certificates executed and authenticated by the Securities
Administrator and delivered by the Trustee, substantially in the form annexed
hereto as Exhibit A-2 and evidencing (i) a Regular Interest in REMIC III, (ii)
the right to receive the related Net WAC Rate Carryover Amount and (iii) the
obligation to pay any Class IO Distribution Amount.
21
“Class
M-7 Principal Distribution Amount”:
With
respect to any Distribution Date on or after the Stepdown Date and on which
a
Trigger Event is not in effect, the excess of (x) the sum of (i) the aggregate
Certificate Principal Balance of the Class A Certificates after taking into
account the payment of the Class A Principal Distribution Amount on the
Distribution Date, (ii) the Certificate Principal Balance of the Class M-1
Certificates after taking into account the payment of the Class M-1 Principal
Distribution Amount on the Distribution Date, (iii) the Certificate Principal
Balance of the Class M-2 Certificates after taking into account the payment
of
the Class M-2 Principal Distribution Amount on the Distribution Date, (iv)
the
Certificate Principal Balance of the Class M-3 Certificates after taking into
account the payment of the Class M-3 Principal Distribution Amount on the
Distribution Date, (v) the Certificate Principal Balance of the Class M-4
Certificates after taking into account the payment of the Class M-4 Principal
Distribution Amount on the Distribution Date, (vi) the Certificate Principal
Balance of the Class M-5 Certificates after taking into account the payment
of
the Class M-5 Principal Distribution Amount on the Distribution Date, (vii)
the
Certificate Principal Balance of the Class M-6 Certificates after taking into
account the payment of the Class M-6 Principal Distribution Amount on the
Distribution Date and (viii) the Certificate Principal Balance of the Class
M-7
Certificates immediately prior to the Distribution Date over (y) the lesser
of
(A) the product of (i) 87.80% and (ii) the aggregate Stated Principal Balance
of
the Mortgage Loans as of the last day of the related Due Period (after giving
effect to scheduled payments of principal due during the related Due Period,
to
the extent received or advanced, and unscheduled collections of principal
received during the related Prepayment Period) and (B) the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the related Due
Period (after giving effect to scheduled payments of principal due during the
related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period) minus
the product of (i) 0.50% and (ii) the aggregate principal balance of the
Mortgage Loans as of the Cut-off Date.
“Class
M-8 Certificate”:
Any
one of the Class M-8 Certificates executed and authenticated by the Securities
Administrator and delivered by the Trustee, substantially in the form annexed
hereto as Exhibit A-2 and evidencing (i) a Regular Interest in REMIC III, (ii)
the right to receive the related Net WAC Rate Carryover Amount and (iii) the
obligation to pay any Class IO Distribution Amount.
“Class
M-8 Principal Distribution Amount”:
With
respect to any Distribution Date on or after the Stepdown Date and on which
a
Trigger Event is not in effect, the excess of (x) the sum of (i) the aggregate
Certificate Principal Balance of the Class A Certificates after taking into
account the payment of the Class A Principal Distribution Amount on the
Distribution Date, (ii) the Certificate Principal Balance of the Class M-1
Certificates after taking into account the payment of the Class M-1 Principal
Distribution Amount on the Distribution Date, (iii) the Certificate Principal
Balance of the Class M-2 Certificates after taking into account the payment
of
the Class M-2 Principal Distribution Amount on the Distribution Date, (iv)
the
Certificate Principal Balance of the Class M-3 Certificates after taking into
account the payment of the Class M-3 Principal Distribution Amount on the
Distribution Date, (v) the Certificate Principal Balance of the Class M-4
Certificates after taking into account the payment of the Class M-4 Principal
Distribution Amount on the Distribution Date, (vi) the Certificate Principal
Balance of the Class M-5 Certificates after taking into account the payment
of
the Class M-5 Principal Distribution Amount on the Distribution Date, (vii)
the
Certificate Principal Balance of the Class M-6 Certificates after taking into
account the payment of the Class M-6 Principal Distribution Amount on the
Distribution Date, (viii) the Certificate Principal Balance of the Class M-7
Certificates after taking into account the payment of the Class M-7 Principal
Distribution Amount on the Distribution Date and (ix) the Certificate Principal
Balance of the Class M-8 Certificates immediately prior to the Distribution
Date
over (y) the lesser of (A) the product of (i) 90.00% and (ii) the aggregate
Stated Principal Balance of the Mortgage Loans as of the last day of the related
Due Period (after giving effect to scheduled payments of principal due during
the related Due Period, to the extent received or advanced, and unscheduled
collections of principal received during the related Prepayment Period) and
(B)
the aggregate Stated Principal Balance of the Mortgage Loans as of the last
day
of the related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period) minus the product of (i) 0.50% and (ii) the aggregate principal balance
of the Mortgage Loans as of the Cut-off Date.
22
“Class
M-9 Certificate”:
Any
one of the Class M-9 Certificates executed and authenticated by the Securities
Administrator and delivered by the Trustee, substantially in the form annexed
hereto as Exhibit A-2 and evidencing (i) a Regular Interest in REMIC III, (ii)
the right to receive the related Net WAC Rate Carryover Amount and (iii) the
obligation to pay any Class IO Distribution Amount.
“Class
M-9 Principal Distribution Amount”:
With
respect to any Distribution Date on or after the Stepdown Date and on which
a
Trigger Event is not in effect, the excess of (x) the sum of (i) the aggregate
Certificate Principal Balance of the Class A Certificates after taking into
account the payment of the Class A Principal Distribution Amount on the
Distribution Date, (ii) the Certificate Principal Balance of the Class M-1
Certificates after taking into account the payment of the Class M-1 Principal
Distribution Amount on the Distribution Date, (iii) the Certificate Principal
Balance of the Class M-2 Certificates after taking into account the payment
of
the Class M-2 Principal Distribution Amount on the Distribution Date, (iv)
the
Certificate Principal Balance of the Class M-3 Certificates after taking into
account the payment of the Class M-3 Principal Distribution Amount on the
Distribution Date, (v) the Certificate Principal Balance of the Class M-4
Certificates after taking into account the payment of the Class M-4 Principal
Distribution Amount on the Distribution Date, (vi) the Certificate Principal
Balance of the Class M-5 Certificates after taking into account the payment
of
the Class M-5 Principal Distribution Amount on the Distribution Date, (vii)
the
Certificate Principal Balance of the Class M-6 Certificates after taking into
account the payment of the Class M-6 Principal Distribution Amount on the
Distribution Date, (viii) the Certificate Principal Balance of the Class M-7
Certificates after taking into account the payment of the Class M-7 Principal
Distribution Amount on the Distribution Date, (ix) the Certificate Principal
Balance of the Class M-8 Certificates after taking into account the payment
of
the Class M-8 Principal Distribution Amount on the Distribution Date and (x)
the
Certificate Principal Balance of the Class M-9 Certificates immediately prior
to
the Distribution Date over (y) the lesser of (A) the product of (i) 92.00%
and
(ii) the aggregate Stated Principal Balance of the Mortgage Loans as of the
last
day of the related Due Period (after giving effect to scheduled payments of
principal due during the related Due Period, to the extent received or advanced,
and unscheduled collections of principal received during the related Prepayment
Period) and (B) the aggregate Stated Principal Balance of the Mortgage Loans
as
of the last day of the related Due Period (after giving effect to scheduled
payments of principal due during the related Due Period, to the extent received
or advanced, and unscheduled collections of principal received during the
related Prepayment Period) minus the product of (i) 0.50% and (ii) the aggregate
principal balance of the Mortgage Loans as of the Cut-off Date.
23
“Class
P Certificate”:
Any
one of the Class P Certificates executed and authenticated by the Securities
Administrator and delivered by the Trustee, substantially in the form annexed
hereto as Exhibit A-4 and evidencing a Regular Interest in REMIC III for
purposes of the REMIC Provisions.
“Class
R Certificates”:
Any
one of the Class R Certificates executed and authenticated by the Securities
Administrator and delivered by the Trustee, substantially in the form annexed
hereto as Exhibit A-5, and evidencing the Class R-I Interest, the Class R-II
Interest and the Class R-III 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.
“Closing
Date”:
March
30, 2007.
“Code”:
The
Internal Revenue Code of 1986 as amended from time to time.
“Collection
Account”:
The
separate account or accounts created and maintained, or caused to be created
and
maintained, by the Servicer pursuant to Section 3.08(a) of this Agreement for
the benefit of the Certificateholders, which shall be entitled “Ocwen Loan
Servicing, LLC, as Servicer for HSBC Bank USA, National Association as Trustee,
in trust for the registered holders of ACE Securities Corp., Home Equity Loan
Trust, Series 2007-WM2, Asset Backed Pass-Through Certificates”. The Collection
Account must be an Eligible Account.
“Commission”:
The
Securities and Exchange Commission.
“Controlling
Person”:
Means,
with respect to any Person, any other Person who “controls” such Person within
the meaning of the Securities Act.
“Corporate
Trust Office”:
The
principal corporate trust office of the Trustee or the Securities Administrator,
as the case may be, at which, at any particular time, its corporate trust
business in connection with this Agreement shall be administered, which office
at the date of the execution of this instrument is located at (i) with respect
to the Trustee, HSBC Bank USA, National Association, 000 Xxxxx Xxxxxx, Xxx
Xxxx,
Xxx Xxxx 00000, Attention: ACE Securities Corp., 2007-WM2, or at such other
address as the Trustee may designate from time to time by notice to the
Certificateholders, the Depositor, the Master Servicer, the Securities
Administrator and the Servicer, or (ii) with respect to the Securities
Administrator, (A) for purposes of Certificate transfers and surrender, Xxxxx
Fargo Bank, National Association, Xxxxx Xxxxxx xxx Xxxxxxxxx Xxxxxx,
Xxxxxxxxxxx, Xxxxxxxxx 00000, Attention: Corporate Trust (ACE 2007-WM2), and
(B)
for all other purposes, Xxxxx Fargo Bank, National Association, X.X. Xxx 00,
Xxxxxxxx, Xxxxxxxx 00000, Attention: Corporate Trust (ACE 2007-WM2) (or for
overnight deliveries, at 0000 Xxx Xxxxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxx 00000,
Attention: Corporate Trust (ACE 2007-WM2)), or at such other address as the
Securities Administrator may designate from time to time by notice to the
Certificateholders, the Depositor, the Master Servicer, the Servicer and the
Trustee.
24
“Corresponding
Certificate”:
With
respect to each REMIC II Regular Interest, as follows:
|
REMIC
II REGULAR INTEREST
|
CLASS
|
|
|
REMIC
II REGULAR INTEREST A-1
|
A-1
|
|
|
REMIC
II REGULAR INTEREST A-2A
|
A-2A
|
|
|
REMIC
II REGULAR INTEREST A-2B
|
A-2B
|
|
|
REMIC
II REGULAR INTEREST A-2C
|
A-2C
|
|
|
REMIC
II REGULAR INTEREST A-2D
|
A-2D
|
|
|
REMIC
II REGULAR INTEREST M-1
|
M-1
|
|
|
REMIC
II REGULAR INTEREST M-2
|
M-2
|
|
|
REMIC
II REGULAR INTEREST M-3
|
M-3
|
|
|
REMIC
II REGULAR INTEREST M-4
|
M-4
|
|
|
REMIC
II REGULAR INTEREST M-5
|
M-5
|
|
|
REMIC
II REGULAR INTEREST M-6
|
M-6
|
|
|
REMIC
II REGULAR INTEREST M-7
|
M-7
|
|
|
REMIC
II REGULAR INTEREST M-8
|
M-8
|
|
|
REMIC
II REGULAR INTEREST M-9
|
M-9
|
|
|
REMIC
II REGULAR INTEREST P
|
P
|
“Credit
Enhancement Percentage”:
For
any Distribution Date, the percentage equivalent of a fraction, the numerator
of
which is the sum of the aggregate Certificate Principal Balances of the
Mezzanine Certificates and the Class CE Certificates (which includes the
Overcollateralization Amount), and the denominator of which is the aggregate
Stated Principal Balance of the Mortgage Loans, calculated after taking into
account distributions of principal on the Mortgage Loans and distribution of
the
Principal Distribution Amount to the Certificates then entitled to distributions
of principal on such Distribution Date.
“Credit
Risk Management Agreements”:
The
agreements between the Credit Risk Manager and the Servicer and/or Master
Servicer, each regarding the loss mitigation and advisory services to be
provided by the Credit Risk Manager.
“Credit
Risk Management Fee”:
The
amount payable to the Credit Risk Manager on each Distribution Date as
compensation for all services rendered by it in the exercise and performance
of
any and all powers and duties of the Credit Risk Manager under the Credit Risk
Management Agreements, which amount shall equal one twelfth of the product
of
(i) the Credit Risk Management Fee Rate multiplied by (ii) the Stated Principal
Balance of the Mortgage Loans and any related REO Properties as of the first
day
of the related Due Period.
“Credit
Risk Management Fee Rate”:
0.0135% per annum.
25
“Credit
Risk Manager”:
Xxxxxxx Fixed Income Services Inc., a Colorado corporation, and its successors
and assigns.
“Custodial
Agreement”:
The
Custodial Agreement dated as of March 1, 2007, among the Trustee, Xxxxx Fargo
and the Servicer, as may be amended or supplemented from time to time, or any
other custodial agreement entered into after the date hereof with respect to
any
Mortgage Loan subject to this Agreement.
“Custodian”:
Xxxxx
Fargo or any other custodian appointed under any custodial agreement entered
into after the date of this Agreement.
“Cut-off
Date”:
With
respect to each Mortgage Loan, March 1, 2007. With respect to all Qualified
Substitute Mortgage Loans, their respective dates of substitution. References
herein to the “Cut-off Date,” when used with respect to more than one Mortgage
Loan, shall be to the respective Cut-off Dates for such Mortgage
Loans.
“Debt
Service Reduction”:
With
respect to any Mortgage Loan, a reduction in the scheduled Monthly Payment
for
such Mortgage Loan by a court of competent jurisdiction in a proceeding under
the Bankruptcy Code, except such a reduction resulting from a Deficient
Valuation.
“Deficient
Valuation”:
With
respect to any Mortgage Loan, a valuation of the related Mortgaged Property
by a
court of competent jurisdiction in an amount less than the then outstanding
principal balance of the Mortgage Loan, which valuation results from a
proceeding initiated under the Bankruptcy Code.
“Definitive
Certificates”:
As
defined in Section 6.01(b).
“Deleted
Mortgage Loan”:
A
Mortgage Loan replaced or to be replaced by a Qualified Substitute Mortgage
Loan.
“Delinquency
Percentage”:
With
respect to any Distribution Date, the percentage equivalent of a fraction,
the
numerator of which is the aggregate Stated Principal Balance of all Mortgage
Loans that, as of the last day of the previous calendar month, are sixty (60)
or
more days delinquent, are in foreclosure, have been converted to REO Properties
or have been discharged by reason of bankruptcy, and the denominator of which
is
the aggregate Stated Principal Balance of the Mortgage Loans and REO Properties
as of the last day of the previous calendar month.
“Depositor”:
ACE
Securities Corp., a Delaware corporation, or its successor in
interest.
“Depository”:
The
Depository Trust Company, or any successor Depository hereafter named. The
nominee of the initial Depository, for purposes of registering those
Certificates that are to be Book-Entry Certificates, is Cede & Co. The
Depository shall at all times be a “clearing corporation” as defined in Section
8-102(3) of the Uniform Commercial Code of the State of New York and a “clearing
agency” registered pursuant to the provisions of Section 17A of the Exchange
Act.
26
“Depository
Institution”:
Any
depository institution or trust company, including the Trustee, that (a) is
incorporated under the laws of the United States of America or any State
thereof, (b) is subject to supervision and examination by federal or state
banking authorities and (c) has outstanding unsecured commercial paper or other
short-term unsecured debt obligations (or, in the case of a depository
institution that is the principal subsidiary of a holding company, such holding
company has unsecured commercial paper or other short-term unsecured debt
obligations) that are rated at least A-1+ by S&P, F-1+ by Fitch and P-1 by
Xxxxx’x (or, if such Rating Agencies are no longer rating the Offered
Certificates, comparable ratings by any other nationally recognized statistical
rating agency then rating the Offered Certificates).
“Depository
Participant”:
A
broker, dealer, bank or other financial institution or other Person for whom
from time to time a Depository effects book-entry transfers and pledges of
securities deposited with the Depository.
“Determination
Date”:
With
respect to each Distribution Date, the 15th
day of
the calendar month in which such Distribution Date occurs, or if such
15th
day is
not a Business Day, the Business Day immediately preceding such 15th
day. The
Determination Date for purposes of Article X hereof shall mean the
15th
day of
the month, or if such 15th
day is
not a Business Day, the first Business Day following such 15th
day.
“Directly
Operate”:
With
respect to any REO Property, the furnishing or rendering of services to the
tenants thereof, the management or operation of such REO Property, the holding
of such REO Property primarily for sale to customers, the performance of any
construction work thereon or any use of such REO Property in a trade or business
conducted by REMIC I other than through an Independent Contractor; provided,
however, that the Servicer, on behalf of the Trustee, shall not be considered
to
Directly Operate an REO Property solely because the Servicer establishes rental
terms, chooses tenants, enters into or renews leases, deals with taxes and
insurance, or makes decisions as to repairs or capital expenditures with respect
to such REO Property.
“Disqualified
Organization”:
Any of
the following: (i) the United States, any State or political subdivision
thereof, any possession of the United States, or any agency or instrumentality
of any of the foregoing (other than an instrumentality which is a corporation
if
all of its activities are subject to tax and, except for Xxxxxxx Mac, a majority
of its board of directors is not selected by such governmental unit), (ii)
any
foreign government, any international organization, or any agency or
instrumentality of any of the foregoing, (iii) any organization (other than
certain farmers’ cooperatives described in Section 521 of the Code) which is
exempt from the tax imposed by Chapter 1 of the Code (including the tax imposed
by Section 511 of the Code on unrelated business taxable income), (iv) rural
electric and telephone cooperatives described in Section 1381(a)(2)(C) of the
Code, (v) an “electing large partnership” and (vi) any other Person so
designated by the Trustee based upon an Opinion of Counsel that the holding
of
an Ownership Interest in a Residual Certificate by such Person may cause any
Trust REMIC or any Person having an Ownership Interest in any Class of
Certificates (other than such Person) to incur a liability for any federal
tax
imposed under the Code that would not otherwise be imposed but for the Transfer
of an Ownership Interest in a Residual Certificate to such Person. The terms
“United States,” “State” and “international organization” shall have the
meanings set forth in Section 7701 of the Code or successor
provisions.
27
“Distribution
Account”:
The
separate trust account or accounts created and maintained by the Securities
Administrator pursuant to Section 3.08(b) in the name of the Securities
Administrator for the benefit of the Certificateholders and designated “Xxxxx
Fargo Bank, National Association, in trust for registered holders of ACE
Securities Corp. Home Equity Loan Trust, Series 2007-WM2”. Funds in the
Distribution Account shall be held in trust for the Certificateholders for
the
uses and purposes set forth in this Agreement. The Distribution Account must
be
an Eligible Account.
“Distribution
Date”:
The
25th day of any month, or if such 25th day is not a Business Day, the Business
Day immediately following such 25th day, commencing in April 2007.
“Due
Date”:
With
respect to each Distribution Date, the day of the month on which the Monthly
Payment is due on a Mortgage Loan during the related Due Period, exclusive
of
any days of grace.
“Due
Period”:
With
respect to any Distribution Date, the period commencing on the second day of
the
month immediately preceding the month in which such Distribution Date occurs
and
ending on the first day of the month in which such Distribution Date
occurs.
“Eligible
Account”:
Any of
(i) an account or accounts maintained with a Depository Institution, (ii) an
account or accounts the deposits in which are fully insured by the FDIC, (iii)
a
trust account or accounts maintained with a federal depository institution
or
state chartered depository institution acting in its fiduciary capacity or
(iv)
an account of accounts acceptable to each Rating Agency as confirmed and
approved in writing by each Rating Agency. Eligible Accounts may bear
interest.
“ERISA”:
The
Employee Retirement Income Security Act of 1974, as amended from time to
time.
“Estate
in Real Property”:
A fee
simple estate in a parcel of land.
“Excess
Liquidation Proceeds”:
To the
extent that such amount is not required by law to be paid to the related
Mortgagor, the amount, if any, by which Liquidation Proceeds with respect to
a
liquidated Mortgage Loan exceed the sum of (i) the outstanding principal balance
of such Mortgage Loan and accrued but unpaid interest at the related Net
Mortgage Rate through the last day of the month in which the related Liquidation
Event occurs, plus (ii) related liquidation expenses or other amounts to which
the Servicer is entitled to be reimbursed from Liquidation Proceeds with respect
to such liquidated Mortgage Loan pursuant to Section 3.09 of this
Agreement.
“Exchange
Act”:
The
Securities Exchange Act of 1934, as amended, and the rules and regulations
thereunder.
“Extraordinary
Trust Fund Expense”:
Any
amounts payable or reimbursable to the Trustee, the Master Servicer, the
Securities Administrator, the Custodian or any director, officer, employee
or
agent of any such Person from the Trust Fund pursuant to the terms of this
Agreement and any amounts payable from the Distribution Account in respect
of
taxes pursuant to Section 11.01(g)(v).
28
“Xxxxxx
Xxx”:
Xxxxxx
Xxx, formerly known as the Federal National Mortgage Association, or any
successor thereto.
“FDIC”:
Federal Deposit Insurance Corporation or any successor thereto.
“Final
Recovery Determination”:
With
respect to any defaulted Mortgage Loan or any REO Property (other than a
Mortgage Loan or REO Property purchased by an originator, the Sponsor or the
Terminator pursuant to or as contemplated by Section 2.03, 3.13(c) or Section
10.01), a determination made by the Servicer that all Insurance Proceeds,
Liquidation Proceeds and other payments or recoveries which the Servicer, in
its
reasonable good faith judgment, expects to be finally recoverable in respect
thereof have been so recovered, which determination shall be evidenced by a
certificate of a Servicing Officer of the Servicer delivered to the Master
Servicer and maintained in its records.
“Fitch”:
Fitch
Ratings or any successor in interest.
“Form
8-K Disclosure Information”:
Has
the meaning set forth in Section 5.06(b) of this Agreement.
“Xxxxxxx
Mac”:
Xxxxxxx Mac, formerly known as the Federal Home Loan Mortgage Corporation,
or
any successor thereto.
“Gross
Margin”:
With
respect to each Adjustable Rate Mortgage Loan, the fixed percentage set forth
in
the related Mortgage Note that is added to the Index on each Adjustment Date
in
accordance with the terms of the related Mortgage Note used to determine the
Mortgage Rate for such Adjustable Rate Mortgage Loan.
“Group
I Allocation Percentage”:
The
aggregate principal balance of the Group I Mortgage Loans divided by the sum
of
the aggregate principal balance of the Group I Mortgage Loans and Group II
Mortgage Loans.
“Group
I Cap Contract”:
The
Cap Contract, dated as of March 30, 2007, between the Trustee and the Cap
Counterparty, including any schedule, confirmations, credit support annex or
other credit support document relating thereto, and attached hereto as Exhibit
J.
“Group
I Cap Credit Support Annex:
The
credit support annex, dated as of March 30, 2007, between the Trustee and the
Cap Counterparty, which is annexed to and forms part of the Group I Cap
Agreement.
“Group
I Interest Remittance Amount”:
With
respect to any Distribution Date is that portion of the Available Distribution
Amount for such Distribution Date that represents interest received or advanced
on the Group I Mortgage Loans (net of the Administration Fees and any Prepayment
Charges and after taking into account amounts payable or reimbursable to the
Trustee, the Custodian, the Securities Administrator, the Master Servicer,
the
Servicer or the Credit Risk Manager pursuant to this Agreement or the Custodial
Agreement with respect to the Group I Mortgage Loans).
29
“Group
I Mortgage Loans”:
Those
Mortgage Loans identified on the Mortgage Loan Schedule as Group I Mortgage
Loans.
“Group
I Principal Distribution Amount”:
With
respect to any Distribution Date the sum of (i) the principal portion of all
Monthly Payments on the Group I Mortgage Loans due during the related Due
Period, whether or not received on or prior to the related Determination Date;
(ii) the principal portion of all proceeds received in respect of the repurchase
of a Group I Mortgage Loan or, in the case of a substitution, certain amounts
representing a principal adjustment, during the related Prepayment Period
pursuant to or as contemplated by Section 2.03, Section 3.13(c) and Section
10.01 of this Agreement; (iii) the principal portion of all other unscheduled
collections, including Insurance Proceeds, Liquidation Proceeds and all
Principal Prepayments in full and in part, received during the related
Prepayment Period, to the extent applied as recoveries of principal on the
Group
I Mortgage Loans, net in each case of payments or reimbursements to the Trustee,
the Custodian, the Master Servicer, the Securities Administrator, the Servicer
or the Credit Risk Manager and (iv) the Class A-1 Allocation Percentage of
the
amount of any Overcollateralization Increase Amount for such Distribution Date
minus
(v) the
Class A-1 Allocation Percentage of the amount of any Overcollateralization
Reduction Amount for such Distribution Date.
“Group
I Principal Remittance Amount”:
With
respect to any Distribution Date the sum of the amounts described in clauses
(i)
through (iii) of the definition of Group I Principal Distribution
Amount.
“Group
II Allocation Percentage”:
The
aggregate principal balance of the Group II Mortgage Loans divided by the sum
of
the aggregate principal balance of the Group I Mortgage Loans and Group II
Mortgage Loans.
“Group
II Cap Contract”:
The
Cap Contract, dated as of March 30, 2007, between the Trustee and the Cap
Counterparty, including any schedule, confirmations, credit support annex or
other credit support document relating thereto, and attached hereto as Exhibit
J.
“Group
II Cap Credit Support Annex:
The
credit support annex, dated as of March 30, 2007, between the Trustee and the
Cap Counterparty, which is annexed to and forms part of the Group II Cap
Agreement.
“Group
II Interest Remittance Amount”:
With
respect to any Distribution Date is that portion of the Available Distribution
Amount for such Distribution Date that represents interest received or advanced
on the Group II Mortgage Loans (net of the Administration Fees and any
Prepayment Charges and after taking into account amounts payable or reimbursable
to the Trustee, the Custodian, the Securities Administrator, the Master
Servicer, the Servicer or the Credit Risk Manager pursuant to this Agreement
or
the Custodial Agreement with respect to the Group II Mortgage
Loans).
“Group
II Mortgage Loans”:
Those
Mortgage Loans identified on the Mortgage Loan Schedule as Group II Mortgage
Loans.
30
“Group
II Principal Distribution Amount”:
With
respect to any Distribution Date the sum of (i) the principal portion of all
Monthly Payments on the Group II Mortgage Loans due during the related Due
Period, whether or not received on or prior to the related Determination Date;
(ii) the principal portion of all proceeds received in respect of the repurchase
of a Group II Mortgage Loan or, in the case of a substitution, certain amounts
representing a principal adjustment, during the related Prepayment Period
pursuant to or as contemplated by Section 2.03, Section 3.13(c) and Section
10.01 of this Agreement; (iii) the principal portion of all other unscheduled
collections, including Insurance Proceeds, Liquidation Proceeds and all
Principal Prepayments in full and in part, received during the related
Prepayment Period, to the extent applied as recoveries of principal on the
Group
II Mortgage Loans, net in each case of payments or reimbursements to the
Trustee, the Custodian, the Master Servicer, the Securities Administrator,
the
Servicer or the Credit Risk Manager and (iv) the Class A-2 Allocation Percentage
of the amount of any Overcollateralization Increase Amount for such Distribution
Date minus
(v) the
Class A-2 Allocation Percentage of the amount of any Overcollateralization
Reduction Amount for such Distribution Date.
“Group
II Principal Remittance Amount”:
With
respect to any Distribution Date will be the sum of the amounts described in
clauses (i) through (iii) of the definition of Group II Principal Distribution
Amount.
“Independent”:
When
used with respect to any accountants, a Person who is “independent” within the
meaning of Rule 2-01(B) of the Commission’s Regulation S-X. When used with
respect to any specified Person, any such Person who (a) is in fact independent
of the Depositor, the Master Servicer, the Securities Administrator, the
Servicer, the Sponsor, the originator and their respective Affiliates, (b)
does
not have any direct financial interest in or any material indirect financial
interest in the Depositor, the Master Servicer, the Securities Administrator,
the Servicer, the Sponsor, any originator or any Affiliate thereof, (c) is
not
connected with the Depositor, the Master Servicer, the Securities Administrator,
the Servicer, the Sponsor, any originator or any Affiliate thereof as an
officer, employee, promoter, underwriter, trustee, partner, director or Person
performing similar functions and (d) is not a member of the immediate family
of
a Person defined on clause (b) or (c) above.
“Independent
Contractor”:
Either
(i) any Person (other than the Servicer) that would be an “independent
contractor” with respect to REMIC I within the meaning of Section 856(d)(3) of
the Code if REMIC I were a real estate investment trust (except that the
ownership tests set forth in that section shall be considered to be met by
any
Person that owns, directly or indirectly, 35% or more of any Class of
Certificates), so long as REMIC I does not receive or derive any income from
such Person and provided that the relationship between such Person and REMIC
I
is at arm’s length, all within the meaning of Treasury Regulation Section
1.856-4(b)(5), or (ii) any other Person (including the Servicer) if the Trustee
has received an Opinion of Counsel to the effect that the taking of any action
in respect of any REO Property by such Person, subject to any conditions therein
specified, that is otherwise herein contemplated to be taken by an Independent
Contractor will not cause such REO Property to cease to qualify as “foreclosure
property” within the meaning of Section 860G(a)(8) of the Code (determined
without regard to the exception applicable for purposes of Section 860D(a)
of
the Code), or cause any income realized in respect of such REO Property to
fail
to qualify as Rents from Real Property.
31
“Index”:
As of
any Adjustment Date, the index applicable to the determination of the Mortgage
Rate on each Adjustable Rate Mortgage Loan will be the average of the interbank
offered rates for six-month United States dollar deposits in the London market
as published in The
Wall Street Journal and
as
most recently available either (a) as of the first Business Day forty-five
(45)
days prior to such Adjustment Date or (b) as of the first Business Day of the
month preceding the month of such Adjustment Date, as specified in the related
Mortgage Note.
“Institutional
Accredited Investor”:
As
defined in Section 6.01(c).
“Insurance
Proceeds”:
Proceeds of any title policy, hazard policy or other insurance policy, covering
a Mortgage Loan or the related Mortgaged Property, to the extent such proceeds
are not to be applied to the restoration of the related Mortgaged Property
or
released to the Mortgagor or a senior lienholder in accordance with Accepted
Servicing Practices, subject to the terms and conditions of the related Mortgage
Note and Mortgage.
“Interest
Accrual Period”:
With
respect to any Distribution Date and the Class A Certificates and the Mezzanine
Certificates, the period commencing on the Distribution Date of the month
immediately preceding the month in which such Distribution Date occurs (or,
in
the case of the first Distribution Date, commencing on the Closing Date) and
ending on the day preceding such Distribution Date. With respect to any
Distribution Date and the Class CE Certificates and the REMIC I Regular
Interests, the one-month period commencing on the first day of the month prior
to the month in which the Distribution Date occurs and ending on the last day
of
the calendar month immediately preceding the month in which such Distribution
Date occurs.
“Interest
Carry Forward Amount”:
With
respect to any Distribution Date and any Class A Certificate or Mezzanine
Certificate, the sum of (i) the amount, if any, by which (a) the Interest
Distribution Amount for such Class as of the immediately preceding Distribution
Date exceeded (b) the actual amount distributed on such Class in respect of
interest on such immediately preceding Distribution Date and (ii) the amount
of
any Interest Carry Forward Amount for such Class remaining unpaid from the
previous Distribution Date, plus accrued interest on such sum calculated at
the
related Pass-Through Rate for the most recently ended Interest Accrual
Period.
“Interest
Determination Date”:
With
respect to the Class A Certificates, the Mezzanine Certificates, REMIC I Regular
Interests and REMIC II Regular Interests (other than REMIC II Regular Interest
P) and any Interest Accrual Period therefor, the second London Business Day
preceding the commencement of such Interest Accrual Period.
“Interest
Distribution Amount”:
With
respect to any Distribution Date and any Class A Certificates, any Mezzanine
Certificates and any Class CE Certificates, the aggregate Accrued Certificate
Interest on the Certificates of such Class for such Distribution
Date.
“Interest
Remittance Amount”:
With
respect to any Distribution Date, the sum of (i) the Group I Interest Remittance
Amount and (ii) the Group II Interest Remittance Amount.
32
“Last
Scheduled Distribution Date”:
The
Distribution Date occurring in February 2037, which is the Distribution Date
immediately following the maturity date for the Mortgage Loan with the latest
maturity date.
“Late
Collections”:
With
respect to any Mortgage Loan and any Due Period, all amounts received subsequent
to the Determination Date immediately following such Due Period with respect
to
such Mortgage Loan, whether as late payments of Monthly Payments or as Insurance
Proceeds, Liquidation Proceeds or otherwise, which represent late payments
or
collections of principal and/or interest due (without regard to any acceleration
of payments under the related Mortgage and Mortgage Note) but delinquent for
such Due Period and not previously recovered.
“Liquidation
Event”:
With
respect to any Mortgage Loan, any of the following events: (i) such Mortgage
Loan is paid in full; (ii) a Final Recovery Determination is made as to such
Mortgage Loan or (iii) such Mortgage Loan is removed from REMIC I by reason
of
its being purchased, sold or replaced pursuant to or as contemplated by Section
2.03, Section 3.13(c) or Section 10.01 of this Agreement. With respect to any
REO Property, either of the following events: (i) a Final Recovery Determination
is made as to such REO Property or (ii) such REO Property is removed from REMIC
I by reason of its being purchased pursuant to Section 10.01.
“Liquidation
Proceeds”:
The
amount (other than Insurance Proceeds, amounts received in respect of the rental
of any REO Property prior to REO Disposition, or required to be released to
a
Mortgagor or a senior lienholder in accordance with applicable law or the terms
of the related Mortgage Loan Documents) received by the Servicer in connection
with (i) the taking of all or a part of a Mortgaged Property by exercise of
the
power of eminent domain or condemnation (other than amounts required to be
released to the Mortgagor or a senior lienholder), (ii) the liquidation of
a
defaulted Mortgage Loan through a trustee’s sale, foreclosure sale or otherwise,
(iii) the repurchase, substitution or sale of a Mortgage Loan or an REO Property
pursuant to or as contemplated by Section 2.03, Section 3.13(c), Section 3.22
or
Section 10.01 of this Agreement or (iv) any Subsequent Recoveries.
“Loan-to-Value
Ratio”:
As of
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 and the denominator of which is the Value of the related Mortgaged
Property.
“London
Business Day”:
Any
day on which banks in the Cities of London and New York are open and conducting
transactions in United States dollars.
“Loss
Severity Percentage”:
With
respect to any Distribution Date, the percentage equivalent of a fraction,
the
numerator of which is the amount of Realized Losses incurred on a Mortgage
Loan
and the denominator of which is the principal balance of such Mortgage Loan
immediately prior to the liquidation of such Mortgage Loan.
“Marker
Rate”:
With
respect to the Class CE Certificates and any Distribution Date, a per annum
rate
equal to two (2) times the weighted average of the REMIC II Remittance Rate
for
each of REMIC II Regular Interest A-1, REMIC II Regular Interest A-2A, REMIC
II
Regular Interest A-2B, REMIC II Regular Interest A-2C, REMIC II Regular Interest
A-2D, REMIC II Regular Interest M-1, REMIC II Regular Interest M-2, REMIC II
Regular Interest M-3, REMIC II Regular Interest M-4, REMIC II Regular Interest
M-5, REMIC II Regular Interest M-6, REMIC II Regular Interest M-7, REMIC II
Regular Interest M-8, REMIC II Regular Interest M-9 and REMIC II Regular
Interest ZZ, with the rate on each such REMIC II Regular Interest (other than
REMIC II Regular Interest ZZ) subject to a cap equal to the lesser of (i) the
related One-Month LIBOR Pass-Through Rate and (ii) the related Net WAC
Pass-Through Rate for the Corresponding Certificate for the purpose of this
calculation for such Distribution Date and with the rate on REMIC II Regular
Interest ZZ subject to a cap of zero for the purpose of this calculation;
provided however, each such cap for each REMIC II Regular Interest (other than
REMIC II Regular Interest ZZ) shall be multiplied by a fraction the numerator
of
which is the actual number of days in the related Interest Accrual Period and
the denominator of which is 30.
33
“Master
Servicer”:
As of
the Closing Date, Xxxxx Fargo Bank, National Association and thereafter, its
respective successors in interest who meet the qualifications of this Agreement.
The Master Servicer and the Securities Administrator shall at all times be
the
same Person or an Affiliate.
“Master
Servicer Event of Default”:
One or
more of the events described in Section 8.01(b).
“Master
Servicing Fee”:
With
respect to each Mortgage Loan and for any calendar month, an amount equal to
one-twelfth of the product of the Master Servicing Fee Rate multiplied by the
Scheduled Principal Balance of the Mortgage Loans as of the Due Date in the
preceding calendar month.
“Master
Servicing Fee Rate”:
0.004%
per annum.
“Maximum
ZZ Uncertificated Interest Deferral Amount”:
With
respect to any Distribution Date, the excess of (i) accrued interest at the
REMIC II Remittance Rate applicable to REMIC II Regular Interest ZZ for such
Distribution Date on a balance equal to the Uncertificated Balance of REMIC
II
Regular Interest ZZ minus the REMIC II Overcollateralization Amount, in each
case for such Distribution Date, over (ii) Uncertificated Interest on REMIC
II
Regular Interest A-1, REMIC II Regular Interest A-2A, REMIC II Regular Interest
A-2B, REMIC II Regular Interest A-2C, REMIC II Regular Interest A-2D, REMIC
II
Regular Interest M-1, REMIC II Regular Interest M-2, REMIC II Regular Interest
M-3, REMIC II Regular Interest M-4, REMIC II Regular Interest M-5, REMIC II
Regular Interest M-6, REMIC II Regular Interest M-7, REMIC II Regular Interest
M-8 and REMIC II Regular Interest M-9 for such Distribution Date, with the
rate
on each such REMIC II Regular Interest subject to a cap equal to the lesser
of
(i) the related One-Month LIBOR Pass-Through Rate and (ii) the related Net
WAC
Pass-Through Rate for the Corresponding Certificate for the purpose of this
calculation for such Distribution Date; provided however, each such cap for
each
REMIC II Regular Interest shall be multiplied by a fraction the numerator of
which is the actual number of days in the related Interest Accrual Period and
the denominator of which is 30.
34
“Maximum
Mortgage Rate”:
With
respect to each Adjustable Rate Mortgage Loan, the percentage set forth in
the
related Mortgage Note as the maximum Mortgage Rate thereunder.
“MERS”:
Mortgage Electronic Registration Systems, Inc., a corporation organized and
existing under the laws of the State of Delaware, or any successor
thereto.
“MERS®
System”:
The
system of recording transfers of mortgages electronically maintained by
MERS.
“Mezzanine
Certificate”:
Any
Class X-0, Xxxxx X-0, Class M-3, Class M-4, Class M-5, Class M-6, Class M-7,
Class M-8 or Class M-9 Certificate.
“MIN”:
The
Mortgage Identification Number for Mortgage Loans registered with MERS on the
MERS® System.
“Minimum
Mortgage Rate”:
With
respect to each Adjustable Rate Mortgage Loan, the percentage set forth in
the
related Mortgage Note as the minimum Mortgage Rate thereunder.
“MOM
Loan”:
With
respect to any Mortgage Loan, MERS acting 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
Payment”:
With
respect to any Mortgage Loan, the scheduled monthly payment of principal and
interest on such Mortgage Loan which is payable by the related Mortgagor from
time to time under the related Mortgage Note, determined: (a) after giving
effect to (i) any Deficient Valuation and/or Debt Service Reduction with respect
to such Mortgage Loan and (ii) any reduction in the amount of interest
collectible from the related Mortgagor pursuant to the Relief Act or similar
state or local laws; (b) without giving effect to any extension granted or
agreed to by the Servicer pursuant to Section 3.01 of this Agreement; and (c)
on
the assumption that all other amounts, if any, due under such Mortgage Loan
are
paid when due.
“Moody’s”:
Xxxxx’x Investors Service, Inc. or any successor in interest.
“Mortgage”:
The
mortgage, deed of trust or other instrument creating a first or second lien
on,
or first or second priority security interest in, a Mortgaged Property securing
a Mortgage Note.
“Mortgage
File”:
The
Mortgage Loan Documents pertaining to a particular Mortgage Loan.
“Mortgage
Loan”:
Each
mortgage loan transferred and assigned to the Trustee and the Mortgage Loan
Documents for which have been delivered to the Custodian pursuant to Section
2.01 of this Agreement and pursuant to the Custodial Agreement, as held from
time to time as a part of the Trust Fund, the Mortgage Loans so held being
identified in the Mortgage Loan Schedule.
35
“Mortgage
Loan Documents”:
The
documents evidencing or relating to each Mortgage Loan delivered to the
Custodian under the Custodial Agreement on behalf of the Trustee.
“Mortgage
Loan Purchase Agreement”:
Shall
mean the Mortgage Loan Purchase Agreement dated as of March 30, 2007, between
the Depositor and the Sponsor, a copy of which is attached hereto as
Exhibit F.
“Mortgage
Loan Schedule”:
As of
any date, the list of Mortgage Loans included in REMIC I on such date,
separately identifying the Group I Mortgage Loans and Group II Mortgage Loans,
attached hereto as Schedule
1.
The
Depositor shall deliver or cause the delivery of the initial Mortgage Loan
Schedule to the Servicer, the Master Servicer, the Custodian and the Trustee
on
the Closing Date. The Mortgage Loan Schedule shall set forth the following
information with respect to each Mortgage Loan:
(i) the
Mortgage Loan identifying number;
(ii) the
Mortgagor’s first and last name;
(iii) the
street address of the Mortgaged Property including the state and zip
code;
(iv) a
code
indicating whether the Mortgaged Property is owner-occupied;
(v) the
type
of Residential Dwelling constituting the Mortgaged Property;
(vi) the
original months to maturity;
(vii) the
original date of the Mortgage Loan and the remaining months to maturity from
the
Cut-off Date, based on the original amortization schedule;
(viii) the
Loan-to-Value Ratio at origination;
(ix) the
Mortgage Rate in effect immediately following the Cut-off Date;
(x) the
date
on which the first Monthly Payment was due on the Mortgage Loan;
(xi) the
stated maturity date;
(xii) the
amount of the Monthly Payment at origination;
(xiii) the
amount of the Monthly Payment as of the Cut-off Date;
(xiv) the
last
Due Date on which a Monthly Payment was actually applied to the unpaid Stated
Principal Balance;
36
(xv) the
original principal amount of the Mortgage Loan;
(xvi) the
Stated Principal Balance of the Mortgage Loan as of the close of business on
the
Cut-off Date;
(xvii) with
respect to each Adjustable Rate Mortgage Loan, the first Adjustment
Date;
(xviii) with
respect to each Adjustable Rate Mortgage Loan, the Gross Margin;
(xix) a
code
indicating the purpose of the loan (i.e., purchase financing, rate/term
refinancing, cash-out refinancing);
(xx) with
respect to each Adjustable Rate Mortgage Loan, the Maximum Mortgage Rate under
the terms of the Mortgage Note;
(xxi) with
respect to each Adjustable Rate Mortgage Loan, the Minimum Mortgage Rate under
the terms of the Mortgage Note;
(xxii) the
Mortgage Rate at origination;
(xxiii) with
respect to each Adjustable Rate Mortgage Loan, the Periodic Rate
Cap;
(xxiv) with
respect to each Adjustable Rate Mortgage Loan, the first Adjustment Date
immediately following the Cut-off Date;
(xxv) with
respect to each Adjustable Rate Mortgage Loan, the Index;
(xxvi) the
date
on which the first Monthly Payment was due on the Mortgage Loan and, if such
date is not consistent with the Due Date currently in effect, such Due
Date;
(xxvii) a
code
indicating whether the Mortgage Loan is an Adjustable Rate Mortgage Loan or
a
fixed rate Mortgage Loan;
(xxviii)
a code
indicating the documentation style (i.e., full, stated or limited);
(xxix) a
code
indicating if the Mortgage Loan is subject to a primary insurance policy or
lender paid mortgage insurance policy and the name of the insurer and, if
applicable, the rate payable in connection therewith;
(xxx) the
Appraised Value of the Mortgaged Property;
(xxxi) the
sale
price of the Mortgaged Property, if applicable;
37
(xxxii) a
code
indicating whether the Mortgage Loan is subject to a Prepayment Charge, the
term
of such Prepayment Charge and the amount of such Prepayment Charge;
(xxxiii) the
product type (e.g., 2/28, 15 year fixed, 30 year fixed, 15/30 balloon,
etc.);
(xxxiv) the
Mortgagor’s debt to income ratio;
(xxxv) the
FICO
score at origination;
(xxxvi) with
respect to each Mortgage Loan registered on MERS, the MIN;
(xxxvii) a
code
indicating whether the Mortgage Loan is secured by a first or second
lien;
(xxxviii) the
Custodian; and
(xxxix) the
Servicer.
The
Mortgage Loan Schedule shall set forth the following information with respect
to
the Mortgage Loans in the aggregate as of the Cut-off Date: (1) the number
of
Mortgage Loans; (2) the current principal balance of the Mortgage Loans; (3)
the
weighted average Mortgage Rate of the Mortgage Loans; and (4) the weighted
average maturity of the Mortgage Loans. The Mortgage Loan Schedule shall be
amended from time to time by the Depositor in accordance with the provisions
of
this Agreement. With respect to any Qualified Substitute Mortgage Loan, the
Cut-off Date shall refer to the related Cut-off Date for such Mortgage Loan,
determined in accordance with the definition of Cut-off Date
herein.
“Mortgage
Note”:
The
original executed note or other evidence of the indebtedness of a Mortgagor
under a Mortgage Loan.
“Mortgage
Rate”:
With
respect to each Mortgage Loan, the annual rate at which interest accrues on
such
Mortgage Loan from time to time in accordance with the provisions of the related
Mortgage Note, which rate with respect to each Adjustable Rate Mortgage Loan
(A)
as of any date of determination until the first Adjustment Date following the
Cut-off Date shall be the rate set forth in the Mortgage Loan Schedule as the
Mortgage Rate in effect immediately following the Cut-off Date and (B) as of
any
date of determination thereafter shall be the rate as adjusted on the most
recent Adjustment Date equal to the sum, rounded to the nearest 0.125% as
provided in the Mortgage Note, of the Index, as most recently available as
of a
date prior to the Adjustment Date as set forth in the related Mortgage Note,
plus the related Gross Margin; provided that the Mortgage Rate on such
Adjustable Rate Mortgage Loan on any Adjustment Date shall never be more than
the lesser of (i) the sum of the Mortgage Rate in effect immediately prior
to
the Adjustment Date plus the related Periodic Rate Cap, if any, and (ii) the
related Maximum Mortgage Rate, and shall never be less than the greater of
(i)
the Mortgage Rate in effect immediately prior to the Adjustment Date less the
Periodic Rate Cap, if any, and (ii) the related Minimum Mortgage Rate. With
respect to each Mortgage Loan that becomes an REO Property, as of any date
of
determination, the annual rate determined in accordance with the immediately
preceding sentence as of the date such Mortgage Loan became an REO
Property.
38
“Mortgaged
Property”:
The
underlying property securing a Mortgage Loan, including any REO Property,
consisting of an Estate in Real Property improved by a Residential
Dwelling.
“Mortgagor”:
The
obligor on a Mortgage Note.
“Net
Monthly Excess Cashflow”:
With
respect to any Distribution Date, the sum of (i) any Overcollateralization
Reduction Amount for such Distribution Date and (ii) the excess of (x) the
Available Distribution Amount for such Distribution Date over (y) the sum for
such Distribution Date of (A) the aggregate Senior Interest Distribution Amounts
payable to the Holders of the Class A Certificates, (B) the aggregate Interest
Distribution Amounts payable to the holders of the Mezzanine Certificates,
(C)
the Principal Remittance Amount and (D) any Net Swap Payment or Swap Termination
Payment (not caused by the occurrence of a Swap Provider Trigger Event) owed
to
the Swap Provider (to the extent such amount has not been paid by the Securities
Administrator from any upfront payment received pursuant to any related
replacement interest rate swap agreement that may be entered into by the Trustee
on behalf of the Supplemental Interest Trust).
“Net
Mortgage Rate”:
With
respect to any Mortgage Loan (or the related REO Property) as of any date of
determination, a per annum rate of interest equal to the then applicable
Mortgage Rate for such Mortgage Loan minus the Administration Fee
Rate.
“Net
Swap Payment”:
With
respect to each Distribution Date, the net payment required to be made pursuant
to the terms of the Swap Agreement by either the Swap Provider or Securities
Administrator from the Supplemental Interest Trust, which net payment shall
not
take into account any Swap Termination Payment.
“Net
WAC Pass-Through Rate”:
With
respect to the Class A-1 Certificates and any Distribution Date, a rate per
annum (adjusted for the actual number of days elapsed in the related Interest
Accrual Period) equal to the product of (i) twelve and (ii) a fraction,
expressed as a percentage, the numerator of which is the amount of interest
which accrued on the Group I Mortgage Loans in the prior calendar month minus
the fees payable to the Servicer, the Master Servicer and the Credit Risk
Manager with respect to the Group I Mortgage Loans for such Distribution Date
and the Group I Allocation Percentage of any Net Swap Payment payable to the
Swap Provider and Swap Termination Payment payable to the Swap Provider which
was not caused by the occurrence of a Swap Provider Trigger Event (to the extent
such amount has not been paid by the Securities Administrator from any upfront
payment received pursuant to any related replacement interest rate swap
agreement that may be entered into by the Trustee on behalf of the Supplemental
Interest Trust), in each case for such Distribution Date and the denominator
of
which is the aggregate principal balance of the Group I Mortgage Loans as of
the
last day of the immediately preceding Due Period (or as of the Cut-off Date
with
respect to the first Distribution Date) after giving effect to Principal
Prepayments received during the related Prepayment Period which were distributed
on the immediately preceding Distribution Date. For federal income tax purposes,
such rate shall be expressed as the weighted average of (adjusted for the actual
number of days elapsed in the related Interest Accrual Period) the REMIC II
Remittance Rate on REMIC II Regular Interest I-GRP, weighted on the basis of
the
Uncertificated Balance of such REMIC II Regular Interest.
39
With
respect to the Class A-2 Certificates and any Distribution Date, a rate per
annum (adjusted for the actual number of days elapsed in the related Interest
Accrual Period) equal to the product of (i) twelve and (ii) a fraction,
expressed as a percentage, the numerator of which is the amount of interest
which accrued on the Group II Mortgage Loans in the prior calendar month minus
the fees payable to the Servicer, the Master Servicer and the Credit Risk
Manager with respect to the Group II Mortgage Loans for such Distribution Date
and the Group II Allocation Percentage of any Net Swap Payment payable to the
Swap Provider and Swap Termination Payment payable to the Swap Provider which
was not caused by the occurrence of a Swap Provider Trigger Event (to the extent
such amount has not been paid by the Securities Administrator from any upfront
payment received pursuant to any related replacement interest rate swap
agreement that may be entered into by the Trustee on behalf of the Supplemental
Interest Trust), in each case for such Distribution Date and the denominator
of
which is the aggregate principal balance of the Group II Mortgage Loans as
of
the last day of the immediately preceding Due Period (or as of the Cut-off
Date
with respect to the first Distribution Date) after giving effect to Principal
Prepayments received during the related Prepayment Period which were distributed
on the immediately preceding Distribution Date. For federal income tax purposes,
such rate shall be expressed as the weighted average of (adjusted for the actual
number of days elapsed in the related Interest Accrual Period) the REMIC II
Remittance Rate on REMIC II Regular Interest II-GRP, weighted on the basis
of
the Uncertificated Balance of such REMIC II Regular Interest.
With
respect to the Mezzanine Certificates and any Distribution Date a rate per
annum
equal to the weighted average (weighted in proportion to the results of
subtracting from the Scheduled Principal Balance of each loan group, the
aggregate Certificate Principal Balance of the related Class A Certificates),
of
(i) the Net WAC Pass-Through Rate for the Class A-1 Certificates and (ii) the
Net WAC Pass-Through Rate for the Class A-2 Certificates. For federal income
tax
purposes, such rate shall be expressed as the weighted average of (adjusted
for
the actual number of days elapsed in the related Interest Accrual Period) the
REMIC II Remittance Rates on (a) REMIC II Regular Interest I-SUB, subject to
a
cap and a floor equal to the REMIC II Remittance Rate on REMIC II Regular
Interest I-GRP and (b) REMIC II Regular Interest II-SUB, subject to a cap and
a
floor equal to the REMIC II Remittance Rate on REMIC II Regular Interest II-GRP,
weighted on the basis of the Uncertificated Balance of each such REMIC II
Regular Interest.
40
“New
Lease”:
Any
lease of REO Property entered into on behalf of REMIC I, including any lease
renewed or extended on behalf of REMIC I, if REMIC I has the right to
renegotiate the terms of such lease.
“Nonrecoverable
P&I Advance”:
Any
P&I Advance previously made or proposed to be made in respect of a Mortgage
Loan or REO Property that, in the good faith business judgment of the Servicer
or a successor to the Servicer (including the Master Servicer) will not or,
in
the case of a proposed P&I Advance, would not be ultimately recoverable from
related Late Collections, Insurance Proceeds or Liquidation Proceeds on such
Mortgage Loan or REO Property as provided herein.
“Nonrecoverable
Servicing Advance”:
Any
Servicing Advance previously made or proposed to be made in respect of a
Mortgage Loan or REO Property that, in the good faith business judgment of
the
Servicer or a successor to the Servicer (including the Master Servicer) will
not
or, in the case of a proposed Servicing Advance, would not be ultimately
recoverable from related Late Collections, Insurance Proceeds or Liquidation
Proceeds on such Mortgage Loan or REO Property as provided herein.
“Non-United
States Person”:
Any
Person other than a United States Person.
“Notional
Amount”:
With
respect to the Class CE Certificates and any Distribution Date, the
Uncertificated Balance of the REMIC II Regular Interests (other than REMIC
II
Regular Interest P) for such Distribution Date. As of the Closing Date, the
Notional Amount of the Class CE Certificates is equal to $784,302,034.76.
With
respect to REMIC II Regular Interest IO and each Distribution Date listed below,
the aggregate Uncertificated Balance of the REMIC I Regular Interests ending
with the designation “A” listed below:
|
Distribution
Date
|
REMIC
I Regular Interests
|
|
|
1st
through 7th
|
I-1-A
through I-54-A and II-1-A through II-54-A
|
|
|
8
|
I-2-A
through I-54-A and II-2-A through II-54-A
|
|
|
9
|
I-3-A
through I-54-A and II-3-A through II-54-A
|
|
|
10
|
I-4-A
through I-54-A and II-4-A through II-54-A
|
|
|
11
|
I-5-A
through I-54-A and II-5-A through II-54-A
|
|
|
12
|
I-6-A
through I-54-A and II-6-A through II-54-A
|
|
|
13
|
I-7-A
through I-54-A and II-7-A through II-54-A
|
|
|
14
|
I-8-A
through I-54-A and II-8-A through II-54-A
|
|
|
15
|
I-9-A
through I-54-A and II-9-A through II-54-A
|
|
|
16
|
I-10-A
through I-54-A and II-10-A through II-54-A
|
|
|
17
|
I-11-A
through I-54-A and II-11-A through II-54-A
|
|
|
18
|
I-12-A
through I-54-A and II-12-A through II-54-A
|
|
|
19
|
I-13-A
through I-54-A and II-13-A through II-54-A
|
|
|
20
|
I-14-A
through I-54-A and II-14-A through II-54-A
|
|
|
21
|
I-15-A
through I-54-A and II-15-A through
II-54-A
|
41
|
Distribution
Date
|
REMIC
I Regular Interests
|
|
|
22
|
I-16-A
through I-54-A and II-16-A through II-54-A
|
|
|
23
|
I-17-A
through I-54-A and II-17-A through II-54-A
|
|
|
24
|
I-18-A
through I-54-A and II-18-A through II-54-A
|
|
|
25
|
I-19-A
through I-54-A and II-19-A through II-54-A
|
|
|
26
|
I-20-A
through I-54-A and II-20-A through II-54-A
|
|
|
27
|
I-21-A
through I-54-A and II-21-A through II-54-A
|
|
|
28
|
I-22-A
through I-54-A and II-22-A through II-54-A
|
|
|
29
|
I-23-A
through I-54-A and II-23-A through II-54-A
|
|
|
30
|
I-24-A
through I-54-A and II-24-A through II-54-A
|
|
|
31
|
I-25-A
through I-54-A and II-25-A through II-54-A
|
|
|
32
|
I-26-A
through I-54-A and II-26-A through II-54-A
|
|
|
33
|
I-27-A
through I-54-A and II-27-A through II-54-A
|
|
|
34
|
I-28-A
through I-54-A and II-28-A through II-54-A
|
|
|
35
|
I-29-A
through I-54-A and II-29-A through II-54-A
|
|
|
36
|
I-30-A
through I-54-A and II-30-A through II-54-A
|
|
|
37
|
I-31-A
through I-54-A and II-31-A through II-54-A
|
|
|
38
|
I-32-A
through I-54-A and II-32-A through II-54-A
|
|
|
39
|
I-33-A
through I-54-A and II-33-A through II-54-A
|
|
|
40
|
I-34-A
through I-54-A and II-34-A through II-54-A
|
|
|
41
|
I-35-A
through I-54-A and II-35-A through II-54-A
|
|
|
42
|
I-36-A
through I-54-A and II-36-A through II-54-A
|
|
|
43
|
I-37-A
through I-54-A and II-37-A through II-54-A
|
|
|
44
|
I-38-A
through I-54-A and II-38-A through II-54-A
|
|
|
45
|
I-39-A
through I-54-A and II-39-A through II-54-A
|
|
|
46
|
I-40-A
through I-54-A and II-40-A through II-54-A
|
|
|
47
|
I-41-A
through I-54-A and II-41-A through II-54-A
|
|
|
48
|
I-42-A
through I-54-A and II-42-A through II-54-A
|
|
|
49
|
I-43-A
through I-54-A and II-43-A through II-54-A
|
|
|
50
|
I-44-A
through I-54-A and II-44-A through II-54-A
|
|
|
51
|
I-45-A
through I-54-A and II-45-A through II-54-A
|
|
|
52
|
I-46-A
through I-54-A and II-46-A through II-54-A
|
|
|
53
|
I-47-A
through I-54-A and II-47-A through II-54-A
|
|
|
54
|
I-48-A
through I-54-A and II-48-A through II-54-A
|
|
|
55
|
I-49-A
through I-54-A and II-49-A through II-54-A
|
|
|
56
|
I-50-A
through I-54-A and II-50-A through II-54-A
|
|
|
57
|
I-51-A
through I-54-A and II-51-A through II-54-A
|
|
|
58
|
I-52-A
through I-54-A and II-52-A through II-54-A
|
|
|
59
|
I-53-A
and I-54-A and II-53-A and II-54-A
|
|
|
60
|
I-54-A
and II-54-A
|
|
|
thereafter
|
$0.00
|
With
respect to the Class IO Interest and any Distribution Date, an amount equal
to
the Notional Amount of the REMIC II Regular Interest IO.
“Ocwen”:
Ocwen
Loan Servicing, LLC or any successor thereto appointed hereunder in connection
with the servicing and administration of the Ocwen Mortgage Loans.
“Ocwen
Mortgage Loans”:
Those
Mortgage Loans serviced and administered by Ocwen in accordance with the terms
and conditions of this Agreement and identified as such on the Mortgage Loan
Schedule.
“Offered
Certificates”:
The
Class A Certificates and the Mezzanine Certificates, collectively.
42
“Officer’s
Certificate”:
With
respect to any Person, a certificate signed by the Chairman of the Board, the
Vice Chairman of the Board, the President or a vice president (however
denominated), or by the Treasurer, the Secretary, or one of the assistant
treasurers or assistant secretaries of such Person (or, in the case of a Person
that is not a corporation, signed by the person or persons having like
responsibilities).
“One-Month
LIBOR”:
With
respect to the Class A Certificates, the Mezzanine Certificates, REMIC II
Regular Interests (other than REMIC II Regular Interest P) and any Interest
Accrual Period therefor, the rate determined by the Securities Administrator
on
the related Interest Determination Date on the basis of the offered rate for
one-month U.S. dollar deposits, as such rate appears on Telerate Page 3750
as of
11:00 a.m. (London time) on such Interest Determination Date; provided that
if
such rate does not appear on Telerate Page 3750, the rate for such date will
be
determined on the basis of the offered rates of the Reference Banks for
one-month U.S. dollar deposits, as of 11:00 a.m. (London time) on such Interest
Determination Date. In such event, the Securities Administrator will request
the
principal London office of each of the Reference Banks to provide a quotation
of
its rate. If on such Interest Determination Date, two or more Reference Banks
provide such offered quotations, One-Month LIBOR for the related Interest
Accrual Period shall be the arithmetic mean of such offered quotations (rounded
upwards if necessary to the nearest whole multiple of 1/16). If on such Interest
Determination Date, fewer than two Reference Banks provide such offered
quotations, One-Month LIBOR for the related Interest Accrual Period shall be
the
higher of (i) LIBOR as determined on the previous Interest Determination Date
and (ii) the Reserve Interest Rate. Notwithstanding the foregoing, if, under
the
priorities described above, LIBOR for an Interest Determination Date would
be
based on LIBOR for the previous Interest Determination Date for the third
consecutive Interest Determination Date, the Securities Administrator shall
select an alternative comparable index (over which the Securities Administrator
has no control), used for determining one-month Eurodollar lending rates that
is
calculated and published (or otherwise made available) by an independent party.
The establishment of One-Month LIBOR by the Securities Administrator and the
Securities Administrator’s subsequent calculation of the One-Month LIBOR
Pass-Through Rates for the relevant Interest Accrual Period, shall, in the
absence of manifest error, be final and binding.
“One-Month
LIBOR Pass-Through Rate”:
With
respect to the Class A-1 Certificates and, for purposes of the definition of
“Marker Rate”, REMIC II Regular Interest A-1, a per annum rate equal to
One-Month LIBOR plus the related Certificate Margin.
With
respect to the Class A-2A Certificates and, for purposes of the definition
of
“Marker Rate”, REMIC II Regular Interest A-2A, a per annum rate equal to
One-Month LIBOR plus the related Certificate Margin.
With
respect to the Class A-2B Certificates and, for purposes of the definition
of
“Marker Rate”, REMIC II Regular Interest A-2B, a per annum rate equal to
One-Month LIBOR plus the related Certificate Margin.
With
respect to the Class A-2C Certificates and, for purposes of the definition
of
“Marker Rate”, REMIC II Regular Interest A-2C, a per annum rate equal to
One-Month LIBOR plus the related Certificate Margin.
43
With
respect to the Class A-2D Certificates and, for purposes of the definition
of
“Marker Rate”, REMIC II Regular Interest A-2D, a per annum rate equal to
One-Month LIBOR plus the related Certificate Margin.
With
respect to the Class M-1 Certificates and, for purposes of the definition of
“Marker Rate”, REMIC II Regular Interest M-1, a per annum rate equal to
One-Month LIBOR plus the related Certificate Margin.
With
respect to the Class M-2 Certificates and, for purposes of the definition of
“Marker Rate”, REMIC II Regular Interest M-2, a per annum rate equal to
One-Month LIBOR plus the related Certificate Margin.
With
respect to the Class M-3 Certificates and, for purposes of the definition of
“Marker Rate”, REMIC II Regular Interest M-3, a per annum rate equal to
One-Month LIBOR plus the related Certificate Margin.
With
respect to the Class M-4 Certificates and, for purposes of the definition of
“Marker Rate”, REMIC II Regular Interest M-4, a per annum rate equal to
One-Month LIBOR plus the related Certificate Margin.
With
respect to the Class M-5 Certificates and, for purposes of the definition of
“Marker Rate”, REMIC II Regular Interest M-5, a per annum rate equal to
One-Month LIBOR plus the related Certificate Margin.
With
respect to the Class M-6 Certificates and, for purposes of the definition of
“Marker Rate”, REMIC II Regular Interest M-6, a per annum rate equal to
One-Month LIBOR plus the related Certificate Margin.
With
respect to the Class M-7 Certificates and, for purposes of the definition of
“Marker Rate”, REMIC II Regular Interest M-7, a per annum rate equal to
One-Month LIBOR plus the related Certificate Margin.
With
respect to the Class M-8 Certificates and, for purposes of the definition of
“Marker Rate”, REMIC II Regular Interest M-8, a per annum rate equal to
One-Month LIBOR plus the related Certificate Margin.
With
respect to the Class M-9 Certificates and, for purposes of the definition of
“Marker Rate”, REMIC II Regular Interest M-9, a per annum rate equal to
One-Month LIBOR plus the related Certificate Margin.
“Opinion
of Counsel”:
A
written opinion of counsel, who may, without limitation, be salaried counsel
for
the Depositor, the Servicer, the Securities Administrator or the Master
Servicer, acceptable to the Trustee, except that any opinion of counsel relating
to (a) the qualification of any REMIC as a REMIC or (b) compliance with the
REMIC Provisions must be an opinion of Independent counsel.
“Optional
Termination Date”:
The
first Distribution Date on which the aggregate principal balance of the Mortgage
Loans (and properties acquired in respect thereof) remaining in the Trust Fund
as of the last day of the related Due Period has been reduced to less than
or
equal to 10% of the aggregate principal balance of the Mortgage Loans as of
the
Cut-off Date.
44
“Overcollateralization
Amount”:
With
respect to any Distribution Date, the excess, if any, of (a) the aggregate
Stated Principal Balances of the Mortgage Loans and REO Properties immediately
following such Distribution Date over (b) the sum of the aggregate Certificate
Principal Balances of the Class A Certificates, the Mezzanine Certificates
and
the Class P Certificates as of such Distribution Date (after taking into account
the payment of the Principal Remittance Amount on such Distribution
Date).
“Overcollateralization
Increase Amount”:
With
respect to any Distribution Date, the amount of Net Monthly Excess Cashflow
actually applied as an accelerated payment of principal to the Class A
Certificates and the Mezzanine Certificates then entitled to distributions
of
principal to the extent the Required Overcollateralization Amount exceeds the
Overcollateralization Amount.
“Overcollateralization
Reduction Amount”:
With
respect to any Distribution Date, the lesser of (i) the amount by which the
Overcollateralization Amount exceeds the Required Overcollateralization Amount
and (ii) the Principal Remittance Amount; provided however that on any
Distribution Date on which a Trigger Event is in effect, the
Overcollateralization Reduction Amount shall equal zero.
“Ownership
Interest”:
As to
any Certificate, any ownership or security interest in such Certificate,
including any interest in such Certificate as the Holder thereof and any other
interest therein, whether direct or indirect, legal or beneficial, as owner
or
as pledgee.
“P&I
Advance”:
As to
any Mortgage Loan or REO Property, any advance made by the Servicer in respect
of any Determination Date pursuant to Section 5.03 of this Agreement, an Advance
Financing Person pursuant to Section 3.26 of this Agreement or in respect of
any
Distribution Date by a successor Servicer pursuant to Section 8.02 of this
Agreement (which advances shall not include principal or interest shortfalls
due
to bankruptcy proceedings or application of the Relief Act or similar state
or
local laws.)
“Pass-Through
Rate”:
With
respect to the Class A Certificates and the Mezzanine Certificates, and any
Distribution Date, a rate per annum equal to the lesser of (i) the related
One-Month LIBOR Pass-Through Rate for such Distribution Date and (ii) the
related Net WAC Pass-Through Rate for such Distribution Date.
With
respect to the Class CE Certificates and any Distribution Date, a rate per
annum
equal to the percentage equivalent of a fraction, the numerator of which is
the
sum of the amounts calculated pursuant to clauses (i) through (xvii) below,
and
the denominator of which is the aggregate Uncertificated Balances of REMIC
II
Regular Interest AA, REMIC II Regular Interest A-1, REMIC II Regular Interest
A-2A, REMIC II Regular Interest A-2B, REMIC II Regular Interest A-2C, REMIC
II
Regular Interest A-2D, REMIC II Regular Interest M-1, REMIC II Regular Interest
M-2, REMIC II Regular Interest M-3, REMIC II Regular Interest M-4, REMIC II
Regular Interest M-5, REMIC II Regular Interest M-6, REMIC II Regular Interest
M-7, REMIC II Regular Interest M-8, REMIC II Regular Interest M-9 and REMIC
II
Regular Interest ZZ. For purposes of calculating the Pass-Through Rate for
the
Class CE Certificates, the numerator is equal to the sum of the following
components:
45
(i) the
REMIC
II Remittance Rate for REMIC II Regular Interest AA minus the Marker Rate,
applied to an amount equal to the Uncertificated Balance of REMIC II Regular
Interest AA;
(ii) the
REMIC
II Remittance Rate for REMIC II Regular Interest A-1 minus the Marker Rate,
applied to an amount equal to the Uncertificated Balance of REMIC II Regular
Interest A-1;
(iii) the
REMIC
II Remittance Rate for REMIC II Regular Interest A-2A minus the Marker Rate,
applied to an amount equal to the Uncertificated Balance of REMIC II Regular
Interest A-2A;
(iv) the
REMIC
II Remittance Rate for REMIC II Regular Interest A-2B minus the Marker Rate,
applied to an amount equal to the Uncertificated Balance of REMIC II Regular
Interest A-2B;
(v) the
REMIC
II Remittance Rate for REMIC II Regular Interest A-2C minus the Marker Rate,
applied to an amount equal to the Uncertificated Balance of REMIC II Regular
Interest A-2C;
(vi) the
REMIC
II Remittance Rate for REMIC II Regular Interest A-2D minus the Marker Rate,
applied to an amount equal to the Uncertificated Balance of REMIC II Regular
Interest A-2D;
(vii) the
REMIC
II Remittance Rate for REMIC II Regular Interest M-1 minus the Marker Rate,
applied to an amount equal to the Uncertificated Balance of REMIC II Regular
Interest M-1;
(viii) the
REMIC
II Remittance Rate for REMIC II Regular Interest M-2 minus the Marker Rate,
applied to an amount equal to the Uncertificated Balance of REMIC II Regular
Interest M-2;
(ix) the
REMIC
II Remittance Rate for REMIC II Regular Interest M-3 minus the Marker Rate,
applied to an amount equal to the Uncertificated Balance of REMIC II Regular
Interest M-3;
(x) the
REMIC
II Remittance Rate for REMIC II Regular Interest M-4 minus the Marker Rate,
applied to an amount equal to the Uncertificated Balance of REMIC II Regular
Interest M-4;
(xi) the
REMIC
II Remittance Rate for REMIC II Regular Interest M-5 minus the Marker Rate,
applied to an amount equal to the Uncertificated Balance of REMIC II Regular
Interest M-5;
46
(xii) the
REMIC
II Remittance Rate for REMIC II Regular Interest M-6 minus the Marker Rate,
applied to an amount equal to the Uncertificated Balance of REMIC II Regular
Interest M-6;
(xiii) the
REMIC
II Remittance Rate for REMIC II Regular Interest M-7 minus the Marker Rate,
applied to an amount equal to the Uncertificated Balance of REMIC II Regular
Interest M-7;
(xiv) the
REMIC
II Remittance Rate for REMIC II Regular Interest M-8 minus the Marker Rate,
applied to an amount equal to the Uncertificated Balance of REMIC II Regular
Interest M-8;
(xv) the
REMIC
II Remittance Rate for REMIC II Regular Interest M-9 minus the Marker Rate,
applied to an amount equal to the Uncertificated Balance of REMIC II Regular
Interest M-9;
(xvi) the
REMIC
II Remittance Rate for REMIC II Regular Interest ZZ minus the Marker Rate,
applied to an amount equal to the Uncertificated Balance of REMIC II Regular
Interest ZZ; and
(xvii) 100%
of
the interest on REMIC II Regular Interest P.
The
Class
IO Interest shall not have a Pass-Through Rate, but current interest for the
Class IO Interest and each Distribution Date shall be an amount equal to 100%
of
the amounts distributable to REMIC II Regular Interest IO for such Distribution
Date.
“PCAOB”:
Means
the
Public Company Accounting Oversight Board.
“Percentage
Interest”:
With
respect to any Class of Certificates (other than the Residual Certificates),
the
undivided percentage ownership in such Class evidenced by such Certificate,
expressed as a percentage, the numerator of which is the initial Certificate
Principal Balance represented by such Certificate and the denominator of which
is the aggregate initial Certificate Principal Balance or Notional Amount of
all
of the Certificates of such Class. The Class A Certificates and the Mezzanine
Certificates are issuable only in minimum Percentage Interests corresponding
to
minimum initial Certificate Principal Balances of $25,000 and integral multiples
of $1.00 in excess thereof. The Class P Certificates are issuable only in
Percentage Interests corresponding to initial Certificate Principal Balances
of
$20 and integral multiples thereof. The Class CE Certificates are issuable
only
in minimum Percentage Interests corresponding to minimum initial Notional
Balances of $10,000 and integral multiples of $1.00 in excess thereof; provided,
however, that a single Certificate of each such Class of Certificates may be
issued having a Percentage Interest corresponding to the remainder of the
aggregate initial Notional Balance of such Class or to an otherwise authorized
denomination for such Class plus such remainder. With respect to any Residual
Certificate, the undivided percentage ownership in such Class evidenced by
such
Certificate, as set forth on the face of such Certificate. The Residual
Certificates are issuable in Percentage Interests of 20% and integral multiples
of 5% in excess thereof.
47
“Periodic
Rate Cap”:
With
respect to each Adjustable Rate Mortgage Loan and any Adjustment Date therefor,
the fixed percentage set forth in the related Mortgage Note, which is the
maximum amount by which the Mortgage Rate for such Adjustable Rate Mortgage
Loan
may increase or decrease (without regard to the Maximum Mortgage Rate or the
Minimum Mortgage Rate) on such Adjustment Date from the Mortgage Rate in effect
immediately prior to such Adjustment Date.
“Permitted
Investments”:
Any
one or more of the following obligations or securities acquired at a purchase
price of not greater than par, regardless of whether issued by the Depositor,
the Servicer, the Master Servicer, the Trustee or any of their respective
Affiliates:
(i) direct
obligations of, or obligations fully guaranteed as to timely payment of
principal and interest by, the United States or any agency or instrumentality
thereof, provided such obligations are backed by the full faith and credit
of
the United States;
(ii) (A)
demand and time deposits in, certificates of deposit of, bankers’ acceptances
issued by or federal funds sold by any depository institution or trust company
(including the Trustee or its agent acting in their respective commercial
capacities) incorporated under the laws of the United States of America or
any
state thereof and subject to supervision and examination by federal and/or
state
authorities, so long as, at the time of such investment or contractual
commitment providing for such investment, such depository institution or trust
company (or, if the only Rating Agency is S&P, in the case of the principal
depository institution in a depository institution holding company, debt
obligations of the depository institution holding company) or its ultimate
parent has a short-term uninsured debt rating in the highest available rating
category of Moody’s and S&P and provided that each such investment has an
original maturity of no more than 365 days; and provided further that, if the
only Rating Agency is S&P and if the depository or trust company is a
principal subsidiary of a bank holding company and the debt obligations of
such
subsidiary are not separately rated, the applicable rating shall be that of
the
bank holding company; and, provided further that, if the original maturity
of
such short-term obligations of a domestic branch of a foreign depository
institution or trust company shall exceed 30 days, the short-term rating of
such
institution shall be A-1+ in the case of S&P if S&P is the Rating
Agency; and (B) any other demand or time deposit or deposit which is fully
insured by the FDIC;
(iii) repurchase
obligations with a term not to exceed 30 days with respect to any security
described in clause (i) above and entered into with a depository institution
or
trust company (acting as principal) rated A-1+ or higher by S&P, and A2 or
higher by Moody’s, provided, however, that collateral transferred pursuant to
such repurchase obligation must be of the type described in clause (i) above
and
must (A) be valued daily at current market prices plus accrued interest, (B)
pursuant to such valuation, be equal, at all times, to 105% of the cash
transferred by a party in exchange for such collateral and (C) be delivered
to
such party or, if such party is supplying the collateral, an agent for such
party, in such a manner as to accomplish perfection of a security interest
in
the collateral by possession of certificated securities;
48
(iv) securities
bearing interest or sold at a discount that are issued by any corporation
incorporated under the laws of the United States of America or any state thereof
and that are rated by each Rating Agency that rates such securities in its
highest long-term unsecured rating categories at the time of such investment
or
contractual commitment providing for such investment;
(v) commercial
paper (including both non-interest-bearing discount obligations and
interest-bearing obligations payable on demand or on a specified date not more
than 30 days after the date of acquisition thereof) that is rated by each Rating
Agency that rates such securities in its highest short-term unsecured debt
rating available at the time of such investment;
(vi) units
of
money market funds that have been rated “AAAm” or “AAAm-G” by S&P or “Aaa”
by Moody’s including any such money market fund managed or advised by the Master
Servicer, the Trustee or any of their Affiliates; and
(vii) if
previously confirmed in writing to the Trustee, any other demand, money market
or time deposit, or any other obligation, security or investment, as may be
acceptable to the Rating Agencies as a permitted investment of funds backing
securities having ratings equivalent to its highest initial rating of the Class
A Certificates;
provided,
however, that no instrument described hereunder shall evidence either the right
to receive (a) only interest with respect to the obligations underlying such
instrument or (b) both principal and interest payments derived from obligations
underlying such instrument and the interest and principal payments with respect
to such instrument provide a yield to maturity at par greater than 120% of
the
yield to maturity at par of the underlying obligations.
“Permitted
Transferee”:
Any
Transferee of a Residual Certificate other than a Disqualified Organization
or
Non-United States Person.
“Person”:
Any
individual, limited liability company, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
“Plan”:
Any
employee benefit plan or certain other retirement plans and arrangements,
including individual retirement accounts and annuities, Xxxxx plans and bank
collective investment funds and insurance company general or separate accounts
in which such plans, accounts or arrangements are invested, that are subject
to
ERISA or Section 4975 of the Code.
“Prepayment
Assumption”:
A
prepayment rate for (a) the Adjustable Rate Mortgage Loans of 100% PPC, which
represents (i) a per annum prepayment rate of 5% of the then outstanding
principal balance of the Adjustable Rate Mortgage Loans in the first month
of
the life of the Adjustable Rate Mortgage Loans, (ii) an additional 2% per annum
in each month thereafter through the eleventh month, (iii) building to a
constant prepayment rate of 27% per annum beginning in the twelfth month and
remaining constant until the twenty-third month, (iv) increasing to and
remaining constant at a prepayment rate of 60% per annum beginning in the
twenty-fourth month until the twenty-seventh month and (v) decreasing and
remaining constant at a prepayment rate of 30% per annum from the twenty-eighth
month and thereafter; provided, however, the prepayment rate will not exceed
85%
per annum in any period for any percentage of PPC; and (b) the fixed-rate
Mortgage Loans of 100% PPC, which represents (i) a per annum prepayment rate
of
4% of the then outstanding principal balance of the fixed rate Mortgage Loans
in
the first month of the life of such Mortgage Loans, (ii) an additional 1.72727%
per annum in each month thereafter through the eleventh month and (iii) a
constant prepayment rate of 23% per annum beginning in the twelfth month and
in
each month thereafter during the life of the fixed rate Mortgage Loans;
provided, however, the prepayment rate will not exceed 85% per annum in any
period for any percentage of PPC. The Prepayment Assumption is used solely
for
determining the accrual of original issue discount on the Certificates for
federal income tax purposes.
49
“Prepayment
Charge”:
With
respect to any Principal Prepayment, any prepayment premium, penalty or charge
payable by a Mortgagor in connection with any Principal Prepayment on a Mortgage
Loan pursuant to the terms of the related Mortgage Note.
“Prepayment
Charge Schedule”:
As of
any date, the list of Mortgage Loans providing for a Prepayment Charge included
in the Trust Fund on such date, attached hereto as Schedule 2 (including the
prepayment charge summary attached thereto). The Depositor shall deliver or
cause the delivery of the Prepayment Charge Schedule to the Servicer, the Master
Servicer and the Trustee on the Closing Date. The Prepayment Charge Schedule
shall set forth the following information with respect to each Prepayment
Charge:
(i) the
Mortgage Loan identifying number;
(ii) a
code
indicating the type of Prepayment Charge;
(iii) the
date
on which the first Monthly Payment was due on the related Mortgage
Loan;
(iv) the
term
of the related Prepayment Charge;
(v) the
original Stated Principal Balance of the related Mortgage Loan; and
(vi) the
Stated Principal Balance of the related Mortgage Loan as of the Cut-off
Date.
“Prepayment
Interest Excess”:
With
respect to each Mortgage Loan that was the subject of a Principal Prepayment
in
full during the portion of the related Prepayment Period occurring between
the
first day of the calendar month in which such Distribution Date occurs and
the
fifteenth (15th)
day of
the calendar month in which such Distribution Date occurs, an amount equal
to
interest (to the extent received) at the applicable Net Mortgage Rate on the
amount of such Principal Prepayment for the number of days commencing on the
first day of the calendar month in which such Distribution Date occurs and
ending on the last date through which interest is collected from the related
Mortgagor. The Servicer may withdraw such Prepayment Interest Excess from the
Collection Account in accordance with Section 3.09(a)(x).
50
“Prepayment
Interest Shortfall”:
With
respect to any Distribution Date, for each such Mortgage Loan that was the
subject of a Principal Prepayment in full or in part during the portion of
the
related Prepayment Period occurring between the first day of the related
Prepayment Period and the last day of the calendar month preceding the month
in
which such Distribution Date occurs that was applied by the Servicer to reduce
the outstanding principal balance of such Mortgage Loan on a date preceding
the
Due Date in the succeeding Prepayment Period, an amount equal to interest at
the
applicable Net Mortgage Rate on the amount of such Principal Prepayment for
the
number of days commencing on the date on which the prepayment is applied and
ending on the last day of the calendar month preceding such Distribution Date.
The obligations of the Servicer and the Master Servicer in respect of any
Prepayment Interest Shortfall are set forth in Section 3.23 and Section 4.19,
respectively of this Agreement.
“Prepayment
Period”:
For
any
Distribution Date (i) with respect to Principal Prepayments in part, the
calendar month immediately preceding the month in which the related Distribution
Date occurs and (ii) with respect to Principal Prepayments in full, the period
from the 16th day of the month immediately preceding the month in which the
related Distribution Date occurs (or with respect to the first Prepayment
Period, the period commencing on the Cut-off Date) to the 15th day of the month
in which such Distribution Date occurs.
“Principal
Prepayment”:
Any
voluntary payment of principal made by the Mortgagor on a Mortgage Loan which
is
received in advance of its scheduled Due Date and which is not accompanied
by an
amount of interest representing the full amount of scheduled interest due on
any
Due Date in any month or months subsequent to the month of
prepayment.
“Principal
Distribution Amount”:
With
respect to any Distribution Date is the sum of the Group I Principal
Distribution Amount and the Group II Principal Distribution Amount.
“Principal
Remittance Amount”:
With
respect to any Distribution Date is the sum of the Group I Principal Remittance
Amount and the Group II Principal Remittance Amount.
“Purchase
Price”:
With
respect to any Mortgage Loan or REO Property to be purchased pursuant to or
as
contemplated by Section 2.03, Section 3.13(c) or Section 10.01 of this
Agreement, and as confirmed by a certification of a Servicing Officer to the
Trustee, an amount equal to the sum of (i) 100% of the Stated Principal Balance
thereof as of the date of purchase (or such other price as provided in Section
10.01), (ii) in the case of (x) a Mortgage Loan, accrued interest on such Stated
Principal Balance at the applicable Net Mortgage Rate in effect from time to
time from the Due Date as to which interest was last covered by a payment by
the
Mortgagor or a P&I Advance by the Servicer, which payment or P&I Advance
had as of the date of purchase been distributed pursuant to Section 5.01,
through the end of the calendar month in which the purchase is to be effected
and (y) an REO Property, the sum of (1) accrued interest on such Stated
Principal Balance at the applicable Net Mortgage Rate in effect from time to
time from the Due Date as to which interest was last covered by a payment by
the
Mortgagor or a P&I Advance by the Servicer through the end of the calendar
month immediately preceding the calendar month in which such REO Property was
acquired, plus (2) REO Imputed Interest for such REO Property for each calendar
month commencing with the calendar month in which such REO Property was acquired
and ending with the calendar month in which such purchase is to be effected,
net
of the total of all net rental income, Insurance Proceeds, Liquidation Proceeds
and P&I Advances that as of the date of purchase had been distributed as or
to cover REO Imputed Interest pursuant to Section 5.01, (iii) any unreimbursed
Servicing Advances and P&I Advances (including Nonrecoverable P&I
Advances and Nonrecoverable Servicing Advances) and any unpaid Servicing Fees
allocable to such Mortgage Loan or REO Property and (iv) in the case of a
Mortgage Loan required to be purchased pursuant to Section 2.03, expenses
reasonably incurred or to be incurred by the Servicer or the Trustee in respect
of the breach or defect giving rise to the purchase obligation and any costs
and
damages incurred by the Trust Fund and the Trustee in connection with any
violation by any such Mortgage Loan of any predatory or abusive lending
law.
51
“QIB”:
As
defined in Section 6.01(c).
“Qualified
Substitute Mortgage Loan”:
A
mortgage loan substituted for a Deleted Mortgage Loan pursuant to the terms
of
this Agreement which must, on the date of such substitution, (i) have an
outstanding principal balance, after application of all scheduled payments
of
principal and interest due during or prior to the month of substitution, not
in
excess of the Scheduled Principal Balance of the Deleted Mortgage Loan as of
the
Due Date in the calendar month during which the substitution occurs, (ii) have
a
Mortgage Rate not less than (and not more than one percentage point in excess
of) the Mortgage Rate of the Deleted Mortgage Loan, (iii) if the mortgage loan
is an Adjustable Rate Mortgage Loan, have a Maximum Mortgage Rate not less
than
the Maximum Mortgage Rate on the Deleted Mortgage Loan, (iv) if the mortgage
loan is an Adjustable Rate Mortgage Loan, have a Minimum Mortgage Rate not
less
than the Minimum Mortgage Rate of the Deleted Mortgage Loan, (v) if the mortgage
loan is an Adjustable Rate Mortgage Loan, have a Gross Margin equal to the
Gross
Margin of the Deleted Mortgage Loan, (vi) if the mortgage loan is an Adjustable
Rate Mortgage Loan, have a next Adjustment Date not more than two months later
than the next Adjustment Date on the Deleted Mortgage Loan, (vii) have a
remaining term to maturity not greater than (and not more than one year less
than) that of the Deleted Mortgage Loan, (viii) have the same Due Date as the
Due Date on the Deleted Mortgage Loan, (ix) have a Loan-to-Value Ratio as of
the
date of substitution equal to or lower than the Loan-to-Value Ratio of the
Deleted Mortgage Loan as of such date, (x) be secured by the same lien priority
on the related Mortgaged Property as the Deleted Mortgage Loan, (xi) have a
credit grade at least equal to the credit grading assigned on the Deleted
Mortgage Loan, (xii) be a “qualified mortgage” as defined in the REMIC
Provisions and (xiii) conform to each representation and warranty set forth
in
Section 6 of the Mortgage Loan Purchase Agreement applicable to the Deleted
Mortgage Loan. In the event that one or more mortgage loans are substituted
for
one or more Deleted Mortgage Loans, the amounts described in clause (i) hereof
shall be determined on the basis of aggregate principal balances, the Mortgage
Rates described in clause (ii) hereof shall be determined on the basis of
weighted average Mortgage Rates, the terms described in clause (vii) hereof
shall be determined on the basis of weighted average remaining term to maturity,
the Loan-to-Value Ratios described in clause (ix) hereof shall be satisfied
as
to each such mortgage loan, the credit grades described in clause (x) hereof
shall be satisfied as to each such mortgage loan and, except to the extent
otherwise provided in this sentence, the representations and warranties
described in clause (xiii) hereof must be satisfied as to each Qualified
Substitute Mortgage Loan or in the aggregate, as the case may be.
52
“Rate/Term
Refinancing”:
A
Refinanced Mortgage Loan, the proceeds of which are not more than a nominal
amount in excess of the existing first mortgage loan and any subordinate
mortgage loan on the related Mortgaged Property and related closing costs,
and
were used exclusively (except for such nominal amount) to satisfy the then
existing first mortgage loan and any subordinate mortgage loan of the Mortgagor
on the related Mortgaged Property and to pay related closing costs.
“Rating
Agency or Rating Agencies”:
Xxxxx’x and S&P or their successors. If such agencies or their successors
are no longer in existence, “Rating Agencies” shall be such nationally
recognized statistical rating agencies, or other comparable Persons, designated
by the Depositor, notice of which designation shall be given to the Trustee
and
the Servicer.
“Realized
Loss”:
With
respect to each Mortgage Loan as to which a Final Recovery Determination has
been made, an amount (not less than zero), as reported by the Servicer to the
Master Servicer (in substantially the form of Schedule 4 hereto) equal to (i)
the unpaid principal balance of such Mortgage Loan as of the commencement of
the
calendar month in which the Final Recovery Determination was made, plus (ii)
accrued interest from the Due Date as to which interest was last paid by the
Mortgagor through the end of the calendar month in which such Final Recovery
Determination was made, calculated in the case of each calendar month during
such period (A) at an annual rate equal to the annual rate at which interest
was
then accruing on such Mortgage Loan and (B) on a principal amount equal to
the
Stated Principal Balance of such Mortgage Loan as of the close of business
on
the Distribution Date during such calendar month, plus (iii) any amounts
previously withdrawn from the Collection Account in respect of such Mortgage
Loan pursuant to Section 3.09(a)(ix) and Section 3.13(b) of this Agreement,
minus (iv) the proceeds, if any, received in respect of such Mortgage Loan
during the calendar month in which such Final Recovery Determination was made,
net of amounts that are payable therefrom to the Servicer with respect to such
Mortgage Loan pursuant to Section 3.09(a)(iii) of this Agreement.
With
respect to any REO Property as to which a Final Recovery Determination has
been
made, an amount (not less than zero) equal to (i) the unpaid principal balance
of the related Mortgage Loan as of the date of acquisition of such REO Property
on behalf of REMIC I, plus (ii) accrued interest from the Due Date as to which
interest was last paid by the Mortgagor in respect of the related Mortgage
Loan
through the end of the calendar month immediately preceding the calendar month
in which such REO Property was acquired, calculated in the case of each calendar
month during such period (A) at an annual rate equal to the annual rate at
which
interest was then accruing on the related Mortgage Loan and (B) on a principal
amount equal to the Stated Principal Balance of the related Mortgage Loan as
of
the close of business on the Distribution Date during such calendar month,
plus
(iii) REO Imputed Interest for such REO Property for each calendar month
commencing with the calendar month in which such REO Property was acquired
and
ending with the calendar month in which such Final Recovery Determination was
made, plus (iv) any amounts previously withdrawn from the Collection Account
in
respect of the related Mortgage Loan pursuant to Section 3.09(a)(ix) and Section
3.13(b) of this Agreement, minus (v) the aggregate of all P&I Advances and
Servicing Advances (in the case of Servicing Advances, without duplication
of
amounts netted out of the rental income, Insurance Proceeds and Liquidation
Proceeds described in clause (vi) below) made by the Servicer in respect of
such
REO Property or the related Mortgage Loan for which the Servicer has been or,
in
connection with such Final Recovery Determination, will be reimbursed pursuant
to Section 3.22 of this Agreement out of rental income, Insurance Proceeds
and
Liquidation Proceeds received in respect of such REO Property, minus (vi) the
total of all net rental income, Insurance Proceeds and Liquidation Proceeds
received in respect of such REO Property that has been, or in connection with
such Final Recovery Determination, will be transferred to the Distribution
Account pursuant to Section 3.22 of this Agreement.
53
With
respect to each Mortgage Loan which has become the subject of a Deficient
Valuation, 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, the portion, if any, of the reduction in each affected Monthly
Payment attributable to a reduction in the Mortgage Rate imposed by a court
of
competent jurisdiction. Each such Realized Loss shall be deemed to have been
incurred on the Due Date for each affected Monthly Payment.
To
the
extent the Servicer receives Subsequent Recoveries with respect to any Mortgage
Loan, the amount of Realized Loss with respect to that Mortgage Loan will be
reduced to the extent such recoveries are applied to reduce the Certificate
Principal Balance of any Class of Certificates on any Distribution
Date.
“Record
Date”:
With
respect to each Distribution Date and the Class A Certificates and the Mezzanine
Certificates, the Business Day immediately preceding such Distribution Date
for
so long as such Certificates are Book-Entry Certificates. With respect to each
Distribution Date and any other Class of Certificates, including any Definitive
Certificates, the last day of the calendar month immediately preceding the
month
in which such Distribution Date occurs.
“Reference
Banks”:
Barclays Bank PLC, The Tokyo Mitsubishi Bank and National Westminster Bank
PLC
and their successors in interest; provided, however, that if any of the
foregoing banks are not suitable to serve as a Reference Bank, then any leading
banks selected by the Securities Administrator which are engaged in transactions
in Eurodollar deposits in the International Eurocurrency market (i) with an
established place of business in London, (ii) not controlling, under the control
of or under common control with the Depositor or any Affiliate thereof and
(iii)
which have been designated as such by the Securities Administrator.
“Refinanced
Mortgage Loan”:
A
Mortgage Loan the proceeds of which were not used to purchase the related
Mortgaged Property.
“Regular
Certificate”:
Any
Class A Certificate, Mezzanine Certificate, Class CE Certificate or Class P
Certificate.
“Regular
Interest”:
A
“regular interest” in a REMIC within the meaning of Section 860G(a)(1) of the
Code.
54
“Regulation
AB”:
Means
Subpart 229.1100 - Asset Backed Securities (Regulation AB), 17 C.F.R.
§§229.1100-229.1123, as such may be amended from time to time, and subject to
such clarification and interpretation as have been provided by the Commission
in
the adopting release (Asset-Backed Securities, Securities Act Release No.
33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005)) or by the staff of the
Commission, or as may be provided by the Commission or its staff from time
to
time.
“Regulation
S Temporary Global Certificate”: As defined in
Section 6.01(c).
“Regulation
S Permanent Global Certificate”: As defined in
Section 6.01(c).
“Release
Date”: The fortieth (40th) day after the later of (i) commencement of the
offering of the Class CE Certificates and (ii) the Closing Date.
“Relevant
Servicing Criteria”:
Means
the Servicing Criteria applicable to the various parties, as set forth on
Exhibit E attached hereto. For clarification purposes, multiple parties can
have
responsibility for the same Relevant Servicing Criteria. With respect to a
Servicing Function Participant engaged by the Master Servicer, the Securities
Administrator, the Trustee or the Servicer, the term “Relevant Servicing
Criteria” may refer to a portion of the Relevant Servicing Criteria applicable
to such parties.
“Relief
Act”:
The
Servicemembers Civil Relief Act, as amended, or similar state or local
laws.
“Relief
Act Interest Shortfall”:
With
respect to any Distribution Date and any Mortgage Loan, any reduction in the
amount of interest collectible on such Mortgage Loan for the most recently
ended
Due Period as a result of the application of the Relief Act.
“REMIC”:
A
“real estate mortgage investment conduit” within the meaning of Section 860D of
the Code.
“REMIC
I”:
The
segregated pool of assets subject hereto, constituting the primary trust created
hereby and to be administered hereunder, with respect to which a REMIC election
is to be made, consisting of: (i) such Mortgage Loans and Prepayment Charges
as
from time to time are subject to this Agreement, together with the Mortgage
Files relating thereto, and together with all collections thereon and proceeds
thereof; (ii) any REO Property, together with all collections thereon and
proceeds thereof; (iii) the Trustee’s rights with respect to the Mortgage Loans
under all insurance policies required to be maintained pursuant to this
Agreement and any proceeds thereof; (iv) the Depositor’s rights under the
Mortgage Loan Purchase Agreement (including any security interest created
thereby); and (v) the Collection Account, the Distribution Account and any
REO
Account, and such assets that are deposited therein from time to time and any
investments thereof, together with any and all income, proceeds and payments
with respect thereto. Notwithstanding the foregoing, however, REMIC I
specifically excludes (i) all payments and other collections of principal and
interest due on the Mortgage Loans on or before the Cut-off Date and all
Prepayment Charges payable in connection with Principal Prepayments made before
the Cut-off Date; (ii) the Reserve Fund and any amounts on deposit therein
from
time to time and any proceeds thereof; (iii) the Swap Agreement; (iv) the Cap
Contracts; and (v) the Supplemental Interest Trust.
55
“REMIC
I Group I Regular Interests”:
REMIC
I Regular Interest I and REMIC I Regular Interest I-1-A through REMIC I Regular
Interest I-51-B as designated in the Preliminary Statement hereto.
“REMIC
I Group II Regular Interests”:
REMIC
I Regular Interest II and REMIC I Regular Interest II-1-A through REMIC II
Regular Interest II-51-B as designated in the Preliminary Statement
hereto.
“REMIC
I Regular Interest”:
Any of
the separate non-certificated beneficial ownership interests in REMIC I issued
hereunder and designated as a “regular interest” in REMIC I. Each REMIC I
Regular Interest shall accrue interest at the related REMIC I Remittance Rate
in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to
its
initial Uncertificated Balance as set forth in the Preliminary Statement hereto.
“REMIC
I Remittance Rate”:
With
respect to REMIC I Regular Interest I, a per annum rate equal to the weighted
average of the Net Mortgage Rates of the Group I Mortgage Loans. With respect
to
each REMIC I Group I Regular Interest ending with the designation “A”, a per
annum rate equal to the weighted average of the Net Mortgage Rates of the Group
I Mortgage Loans multiplied by 2, subject to a maximum rate of 9.7800%. With
respect to each REMIC I Group I Regular Interest ending with the designation
“B”, the greater of (x) a per annum rate equal to the excess, if any, of (i) 2
multiplied by the weighted average of the Net Mortgage Rates of the Group I
Mortgage Loans over (ii) 9.7800% and (y) 0.00%. With respect to REMIC I Regular
Interest II, a per annum rate equal to the weighted average of the Net Mortgage
Rates of the Group II Mortgage Loans. With respect to each REMIC I Group II
Regular Interest ending with the designation “A”, a per annum rate equal to the
weighted average of the Net Mortgage Rates of the Group II Mortgage Loans
multiplied by 2, subject to a maximum rate of 9.7800%. With respect to each
REMIC I Group II Regular Interest ending with the designation “B”, the greater
of (x) a per annum rate equal to the excess, if any, of (i) 2 multiplied by
the
weighted average of the Net Mortgage Rates of the Group II Mortgage Loans over
(ii) 9.7800% and (y) 0.00%.
“REMIC
II”:
The
segregated pool of assets consisting of all of the REMIC I Regular Interests
conveyed in trust to the Trustee, for the benefit of the REMIC II Regular
Interests pursuant to Section 2.07, and all amounts deposited therein, with
respect to which a separate REMIC election is to be made.
“REMIC
II Interest Loss Allocation Amount”:
With
respect to any Distribution Date, an amount equal to (a) the product of (i)
50%
of the aggregate Stated Principal Balance of the Mortgage Loans and REO
Properties then outstanding and (ii) the REMIC II Remittance Rate for REMIC
II
Regular Interest AA minus the Marker Rate, divided by (b) 12.
“REMIC
II Marker Allocation Percentage”:
50% of
any amount payable or loss attributable from the Mortgage Loans, which shall
be
allocated to REMIC II Regular Interest AA, REMIC II Regular Interest A-1, REMIC
II Regular Interest A-2A, REMIC II Regular Interest A-2B, REMIC II Regular
Interest A-2C, REMIC II Regular Interest A-2D, REMIC II Regular Interest M-1,
REMIC II Regular Interest M-2, REMIC II Regular Interest M-3, REMIC II Regular
Interest M-4, REMIC II Regular Interest M-5, REMIC II Regular Interest M-6,
REMIC II Regular Interest M-7, REMIC II Regular Interest M-8, REMIC II Regular
Interest M-9, REMIC II Regular Interest ZZ and REMIC II Regular Interest
P.
56
“REMIC
II Overcollateralization Amount”:
With
respect to any date of determination, (i) 0.50% of the aggregate Uncertificated
Balances of the REMIC II Regular Interests (other than REMIC II Regular Interest
P) minus (ii) the aggregate of the Uncertificated Balances of REMIC II Regular
Interest A-1, REMIC II Regular Interest A-2A, REMIC II Regular Interest A-2B,
REMIC II Regular Interest A-2C, REMIC II Regular Interest A-2D, REMIC II Regular
Interest M-1, REMIC II Regular Interest M-2, REMIC II Regular Interest M-3,
REMIC II Regular Interest M-4, REMIC II Regular Interest M-5, REMIC II Regular
Interest M-6, REMIC II Regular Interest M-7, REMIC II Regular Interest M-8
and
REMIC II Regular Interest M-9, in each case as of such date of
determination.
“REMIC
II Principal Loss Allocation Amount”:
With
respect to any Distribution Date, an amount equal to (a) the product of (i)
50%
of the aggregate Stated Principal Balance of the Mortgage Loans and REO
Properties then outstanding and (ii) 1 minus a fraction, the numerator of which
is two times the aggregate of the Uncertificated Balances of REMIC II Regular
Interest A-1, REMIC II Regular Interest A-2A, REMIC II Regular Interest A-2B,
REMIC II Regular Interest A-2C, REMIC II Regular Interest A-2D, REMIC II Regular
Interest M-1, REMIC II Regular Interest M-2, REMIC II Regular Interest M-3,
REMIC II Regular Interest M-4, REMIC II Regular Interest M-5, REMIC II Regular
Interest M-6, REMIC II Regular Interest M-7, REMIC II Regular Interest M-8
and
REMIC II Regular Interest M-9 and the denominator of which is the aggregate
of
the Uncertificated Balances of REMIC II Regular Interest A-1, REMIC II Regular
Interest A-2A, REMIC II Regular Interest A-2B, REMIC II Regular Interest A-2C,
REMIC II Regular Interest A-2D, REMIC II Regular Interest M-1, REMIC II Regular
Interest M-2, REMIC II Regular Interest M-3, REMIC II Regular Interest M-4,
REMIC II Regular Interest M-5, REMIC II Regular Interest M-6, REMIC II Regular
Interest M-7, REMIC II Regular Interest M-8, REMIC II Regular Interest M-9
and
REMIC II Regular Interest ZZ.
“REMIC
II Regular Interest”:
Any of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a “regular interest” in REMIC II. Each REMIC II
Regular Interest shall accrue interest at the related REMIC II Remittance Rate
in effect from time to time, and shall be entitled to distributions of
principal, subject to the terms and conditions hereof, in an aggregate amount
equal to its initial Uncertificated Balance as set forth in the Preliminary
Statement hereto. The designations for the respective REMIC II Regular Interests
are set forth in the Preliminary Statement hereto.
“REMIC
II Regular Interest AA”:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest AA shall accrue interest at the related REMIC II Remittance Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to
its
initial Uncertificated Balance as set forth in the Preliminary Statement
hereto.
57
“REMIC
II Regular Interest A-1”:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest A-1 shall accrue interest at the related REMIC II Remittance Rate
in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to
its
initial Uncertificated Balance as set forth in the Preliminary Statement
hereto.
“REMIC
II Regular Interest A-2A”:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest A-2A shall accrue interest at the related REMIC II Remittance Rate
in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to
its
initial Uncertificated Balance as set forth in the Preliminary Statement
hereto.
“REMIC
II Regular Interest A-2B”:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest A-2B shall accrue interest at the related REMIC II Remittance Rate
in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to
its
initial Uncertificated Balance as set forth in the Preliminary Statement
hereto.
“REMIC
II Regular Interest A-2C”:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest A-2C shall accrue interest at the related REMIC II Remittance Rate
in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to
its
initial Uncertificated Balance as set forth in the Preliminary Statement
hereto.
“REMIC
II Regular Interest A-2D”:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest A-2D shall accrue interest at the related REMIC II Remittance Rate
in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to
its
initial Uncertificated Balance as set forth in the Preliminary Statement
hereto.
“REMIC
II Regular Interest IO”:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest IO shall accrue interest at the related REMIC II Remittance Rate in
effect from time to time and shall not be entitled to distributions of
principal.
“REMIC
II Regular Interest M-1”:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest M-1 shall accrue interest at the related REMIC II Remittance Rate
in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to
its
initial Uncertificated Balance as set forth in the Preliminary Statement
hereto.
58
“REMIC
II Regular Interest M-2”:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest M-2 shall accrue interest at the related REMIC II Remittance Rate
in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to
its
initial Uncertificated Balance as set forth in the Preliminary Statement
hereto.
“REMIC
II Regular Interest M-3”:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest M-3 shall accrue interest at the related REMIC II Remittance Rate
in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to
its
initial Uncertificated Balance as set forth in the Preliminary Statement
hereto.
“REMIC
II Regular Interest M-4”:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest M-4 shall accrue interest at the related REMIC II Remittance Rate
in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to
its
initial Uncertificated Balance as set forth in the Preliminary Statement
hereto.
“REMIC
II Regular Interest M-5”:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest M-5 shall accrue interest at the related REMIC II Remittance Rate
in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to
its
initial Uncertificated Balance as set forth in the Preliminary Statement
hereto.
“REMIC
II Regular Interest M-6”:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest M-6 shall accrue interest at the related REMIC II Remittance Rate
in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to
its
initial Uncertificated Balance as set forth in the Preliminary Statement
hereto.
“REMIC
II Regular Interest M-7”:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest M-7 shall accrue interest at the related REMIC II Remittance Rate
in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to
its
initial Uncertificated Balance as set forth in the Preliminary Statement
hereto.
“REMIC
II Regular Interest M-8”:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest M-8 shall accrue interest at the related REMIC II Remittance Rate
in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to
its
initial Uncertificated Balance as set forth in the Preliminary Statement
hereto.
59
“REMIC
II Regular Interest M-9”:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest M-9 shall accrue interest at the related REMIC II Remittance Rate
in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to
its
initial Uncertificated Balance as set forth in the Preliminary Statement
hereto.
“REMIC
II Regular Interest P”:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest P shall accrue interest at the related REMIC II Remittance Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to
its
initial Uncertificated Balance as set forth in the Preliminary Statement
hereto.
“REMIC
II Regular Interest XX”:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest XX shall accrue interest at the related REMIC II Remittance Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to
its
initial Uncertificated Balance as set forth in the Preliminary Statement
hereto.
“REMIC
II Regular Interest ZZ”:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest ZZ shall accrue interest at the related REMIC II Remittance Rate in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to
its
initial Uncertificated Balance as set forth in the Preliminary Statement
hereto.
“REMIC
II Regular Interest I-SUB”:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest I-SUB shall accrue interest at the related REMIC II Remittance Rate
in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to
its
initial Uncertificated Balance as set forth in the Preliminary Statement
hereto.
“REMIC
II Regular Interest I-GRP”:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest I-GRP shall accrue interest at the related REMIC II Remittance Rate
in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to
its
initial Uncertificated Balance as set forth in the Preliminary Statement
hereto.
“REMIC
II Regular Interest II-SUB”:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest II-SUB shall accrue interest at the related REMIC II Remittance Rate
in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to
its
initial Uncertificated Balance as set forth in the Preliminary Statement
hereto.
60
“REMIC
II Regular Interest II-GRP”:
One of
the separate non-certificated beneficial ownership interests in REMIC II issued
hereunder and designated as a Regular Interest in REMIC II. REMIC II Regular
Interest II-GRP shall accrue interest at the related REMIC II Remittance Rate
in
effect from time to time, and shall be entitled to distributions of principal,
subject to the terms and conditions hereof, in an aggregate amount equal to
its
initial Uncertificated Balance as set forth in the Preliminary Statement
hereto.
“REMIC
II Remittance Rate”:
With
respect to REMIC II Regular Interest AA, REMIC II Regular Interest A-1, REMIC
II
Regular Interest A-2A, REMIC II Regular Interest A-2B, REMIC II Regular Interest
A-2C, REMIC II Regular Interest A-2D, REMIC II Regular Interest M-1, REMIC
II
Regular Interest M-2, REMIC II Regular Interest M-3, REMIC II Regular Interest
M-4, REMIC II Regular Interest M-5, REMIC II Regular Interest M-6, REMIC II
Regular Interest M-7, REMIC II Regular Interest M-8, REMIC II Regular Interest
M-9, REMIC II Regular Interest P, REMIC II Regular Interest ZZ, REMIC II Regular
Interest I-SUB, REMIC II Regular Interest II-SUB and REMIC II Regular Interest
XX, a per annum rate (but not less than zero) equal to the weighted average
of:
(w) with respect to REMIC I Regular Interest I and REMIC I Regular Interest
II,
the REMIC I Remittance Rate for each such REMIC I Regular Interest for each
such
Distribution Date, (x) with respect to each REMIC I Regular Interest ending
with
the designation “B”, the weighted average of the REMIC I Remittance Rates for
such REMIC I Regular Interests, weighted on the basis of the Uncertificated
Balances of such REMIC I Regular Interests for each such Distribution Date
and
(y) with respect to REMIC I Regular Interests ending with the designation “A”,
for each Distribution Date listed below, the weighted average of the rates
listed below for each such REMIC I Regular Interest listed below, weighted
on
the basis of the Uncertificated Balances of each such REMIC I Regular Interest
for each such Distribution Date:
|
Distribution
Date
|
REMIC
I Regular Interest
|
Rate
|
||
|
1st
through 6th
|
I-1-A
through I-54-A
|
REMIC
I Remittance Rate
|
||
|
II-1-A
through II-54-A
|
REMIC
I Remittance Rate
|
|||
|
7
|
I-1-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
8
|
I-2-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-2-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate REMIC I Remittance
Rate
|
|||
|
I-1-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
|
REMIC
I Remittance Rate
|
|||
|
9
|
I-3-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-3-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
and I-2-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
and II-2-A
|
REMIC
I Remittance Rate
|
|||
|
10
|
I-4-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
61
|
Distribution
Date
|
REMIC
I Regular Interest
|
Rate
|
|
II-4-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-3-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-3-A
|
REMIC
I Remittance Rate
|
|||
|
11
|
I-5-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-5-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-4-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-4-A
|
REMIC
I Remittance Rate
|
|||
|
12
|
I-6-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-6-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-5-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-5-A
|
REMIC
I Remittance Rate
|
|||
|
13
|
I-7-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-7-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-6-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-6-A
|
REMIC
I Remittance Rate
|
|||
|
14
|
I-8-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-8-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-7-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-7-A
|
REMIC
I Remittance Rate
|
|||
|
15
|
I-9-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-9-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-8-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-8-A
|
REMIC
I Remittance Rate
|
|||
|
16
|
I-10-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-10-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-9-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-9-A
|
REMIC
I Remittance Rate
|
|||
|
17
|
I-11-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-11-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-10-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-10-A
|
REMIC
I Remittance Rate
|
|||
|
18
|
I-12-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-12-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-11-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-11-A
|
REMIC
I Remittance Rate
|
|||
|
19
|
I-13-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-13-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-12-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-12-A
|
REMIC
I Remittance Rate
|
|||
|
20
|
I-14-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-14-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-13-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-13-A
|
REMIC
I Remittance Rate
|
62
|
Distribution
Date
|
REMIC
I Regular Interest
|
Rate
|
||
|
21
|
I-15-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-15-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-14-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-14-A
|
REMIC
I Remittance Rate
|
|||
|
22
|
I-16-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-16-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-15-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-15-A
|
REMIC
I Remittance Rate
|
|||
|
23
|
I-17-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-17-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-16-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-16-A
|
REMIC
I Remittance Rate
|
|||
|
24
|
I-18-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-18-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-17-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-17-A
|
REMIC
I Remittance Rate
|
|||
|
25
|
I-19-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-19-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-18-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-18-A
|
REMIC
I Remittance Rate
|
|||
|
26
|
I-20-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-20-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-19-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-19-A
|
REMIC
I Remittance Rate
|
|||
|
27
|
I-21-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-21-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-20-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-20-A
|
REMIC
I Remittance Rate
|
|||
|
28
|
I-22-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-22-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-21-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-21-A
|
REMIC
I Remittance Rate
|
|||
|
29
|
I-23-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-23-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-22-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-22-A
|
REMIC
I Remittance Rate
|
|||
|
30
|
I-24-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-24-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-23-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-23-A
|
REMIC
I Remittance Rate
|
|||
|
31
|
I-25-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-25-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-24-A
|
REMIC
I Remittance Rate
|
63
|
Distribution
Date
|
REMIC
I Regular Interest
|
Rate
|
||
|
II-1-A
through II-24-A
|
REMIC
I Remittance Rate
|
|||
|
32
|
I-26-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-26-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-25-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-25-A
|
REMIC
I Remittance Rate
|
|||
|
33
|
I-27-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-27-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-26-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-26-A
|
REMIC
I Remittance Rate
|
|||
|
34
|
I-28-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-28-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-27-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-27-A
|
REMIC
I Remittance Rate
|
|||
|
35
|
I-29-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-29-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-28-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-28-A
|
REMIC
I Remittance Rate
|
|||
|
36
|
I-30-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-30-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-29-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-29-A
|
REMIC
I Remittance Rate
|
|||
|
37
|
I-31-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-31-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-30-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-30-A
|
REMIC
I Remittance Rate
|
|||
|
38
|
I-32-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-32-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-31-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-31-A
|
REMIC
I Remittance Rate
|
|||
|
39
|
I-33-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-33-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-32-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-32-A
|
REMIC
I Remittance Rate
|
|||
|
40
|
I-34-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-34-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-33-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-33-A
|
REMIC
I Remittance Rate
|
|||
|
41
|
I-35-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-35-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-34-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-34-A
|
REMIC
I Remittance Rate
|
|||
|
42
|
I-36-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-36-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
64
|
Distribution
Date
|
REMIC
I Regular Interest
|
Rate
|
||
|
I-1-A
through I-35-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-35-A
|
REMIC
I Remittance Rate
|
|||
|
43
|
I-37-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-37-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-36-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-36-A
|
REMIC
I Remittance Rate
|
|||
|
44
|
I-38-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-38-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-37-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-37-A
|
REMIC
I Remittance Rate
|
|||
|
45
|
I-39-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-39-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-38-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-38-A
|
REMIC
I Remittance Rate
|
|||
|
46
|
I-40-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-40-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-39-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-39-A
|
REMIC
I Remittance Rate
|
|||
|
47
|
I-41-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-41-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-40-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-40-A
|
REMIC
I Remittance Rate
|
|||
|
48
|
I-42-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-42-A
through II-41-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-41-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-21-A
|
REMIC
I Remittance Rate
|
|||
|
49
|
I-43-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-43-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-42-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-42-A
|
REMIC
I Remittance Rate
|
|||
|
50
|
I-44-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-44-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-43-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-43-A
|
REMIC
I Remittance Rate
|
|||
|
51
|
I-45-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-45-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-44-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-44-A
|
REMIC
I Remittance Rate
|
|||
|
52
|
I-46-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-46-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-45-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-45-A
|
REMIC
I Remittance Rate
|
|||
|
51
|
I-47-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-47-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
65
|
Distribution
Date
|
REMIC
I Regular Interest
|
Rate
|
||
|
I-1-A
through I-46-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-46-A
|
REMIC
I Remittance Rate
|
|||
|
51
|
I-48-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-48-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-47-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-47-A
|
REMIC
I Remittance Rate
|
|||
|
55
|
I-49-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-49-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-48-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-48-A
|
REMIC
I Remittance Rate
|
|||
|
56
|
I-50-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-50-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-49-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-49-A
|
REMIC
I Remittance Rate
|
|||
|
57
|
I-51-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-51-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-50-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-50-A
|
REMIC
I Remittance Rate
|
|||
|
58
|
I-52-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-52-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-51-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-51-A
|
REMIC
I Remittance Rate
|
|||
|
59
|
I-53-A
and I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-53-A
and II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-52A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-52-A
|
REMIC
I Remittance Rate
|
|||
|
60
|
I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
|||
|
I-1-A
through I-53-A
|
REMIC
I Remittance Rate
|
|||
|
II-1-A
through II-53-A
|
REMIC
I Remittance Rate
|
|||
|
thereafter
|
I-1-A
through I-54-A
|
REMIC
I Remittance Rate
|
||
|
II-1-A
through II-54-A
|
REMIC
I Remittance Rate
|
With
respect to REMIC II Regular Interest I-GRP, a per annum rate (but not less
than
zero) equal to the weighted average of: (w) with respect to REMIC I Regular
Interest I, the REMIC I Remittance Rate for such REMIC I Regular Interest for
each such Distribution Date, (x) with respect to REMIC I Group I Regular
Interests ending with the designation “B”, the weighted average of the REMIC I
Remittance Rates for such REMIC I Regular Interests, weighted on the basis
of
the Uncertificated Balances of each such REMIC I Regular Interest for each
such
Distribution Date and (y) with respect to REMIC I Group I Regular Interests
ending with the designation “A”, for each Distribution Date listed below, the
weighted average of the rates listed below for such REMIC I Regular Interests
listed below, weighted on the basis of the Uncertificated Balances of each
such
REMIC I Regular Interest for each such Distribution Date:
66
|
Distribution
Date
|
REMIC
I Regular Interest
|
Rate
|
||
|
1st
through 6th
|
I-1-A
through I-54-A
|
REMIC
I Remittance Rate
|
||
|
7
|
I-1-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
8
|
I-2-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
|
REMIC
I Remittance Rate
|
|||
|
9
|
I-3-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
and I-2-A
|
REMIC
I Remittance Rate
|
|||
|
10
|
I-4-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-3-A
|
REMIC
I Remittance Rate
|
|||
|
11
|
I-5-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-4-A
|
REMIC
I Remittance Rate
|
|||
|
12
|
I-6-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-5-A
|
REMIC
I Remittance Rate
|
|||
|
13
|
I-7-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-6-A
|
REMIC
I Remittance Rate
|
|||
|
14
|
I-8-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-7-A
|
REMIC
I Remittance Rate
|
|||
|
15
|
I-9-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-8-A
|
REMIC
I Remittance Rate
|
|||
|
16
|
I-10-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-9-A
|
REMIC
I Remittance Rate
|
|||
|
17
|
I-11-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-10-A
|
REMIC
I Remittance Rate
|
|||
|
18
|
I-12-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-11-A
|
REMIC
I Remittance Rate
|
|||
|
19
|
I-13-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-12-A
|
REMIC
I Remittance Rate
|
|||
|
20
|
I-14-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-13-A
|
REMIC
I Remittance Rate
|
|||
|
21
|
I-15-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
67
|
Distribution
Date
|
REMIC
I Regular Interest
|
Rate
|
||
|
I-1-A
through I-14-A
|
REMIC
I Remittance Rate
|
|||
|
22
|
I-16-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-15-A
|
REMIC
I Remittance Rate
|
|||
|
23
|
I-17-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-16-A
|
REMIC
I Remittance Rate
|
|||
|
24
|
I-18-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-17-A
|
REMIC
I Remittance Rate
|
|||
|
25
|
I-19-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-18-A
|
REMIC
I Remittance Rate
|
|||
|
26
|
I-20-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-19-A
|
REMIC
I Remittance Rate
|
|||
|
27
|
I-21-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-20-A
|
REMIC
I Remittance Rate
|
|||
|
28
|
I-22-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-21-A
|
REMIC
I Remittance Rate
|
|||
|
29
|
I-23-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-22-A
|
REMIC
I Remittance Rate
|
|||
|
30
|
I-24-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-23-A
|
REMIC
I Remittance Rate
|
|||
|
31
|
I-25-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-24-A
|
REMIC
I Remittance Rate
|
|||
|
32
|
I-26-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-25-A
|
REMIC
I Remittance Rate
|
|||
|
33
|
I-27-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-26-A
|
REMIC
I Remittance Rate
|
|||
|
34
|
I-28-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-27-A
|
REMIC
I Remittance Rate
|
|||
|
35
|
I-29-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-28-A
|
REMIC
I Remittance Rate
|
|||
|
36
|
I-30-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
68
|
Distribution
Date
|
REMIC
I Regular Interest
|
Rate
|
||
|
I-1-A
through I-29-A
|
REMIC
I Remittance Rate
|
|||
|
37
|
I-31-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-30-A
|
REMIC
I Remittance Rate
|
|||
|
38
|
I-32-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-31-A
|
REMIC
I Remittance Rate
|
|||
|
39
|
I-33-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-32-A
|
REMIC
I Remittance Rate
|
|||
|
40
|
I-34-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-33-A
|
REMIC
I Remittance Rate
|
|||
|
41
|
I-35-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-34-A
|
REMIC
I Remittance Rate
|
|||
|
42
|
I-36-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-35-A
|
REMIC
I Remittance Rate
|
|||
|
43
|
I-37-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-36-A
|
REMIC
I Remittance Rate
|
|||
|
44
|
I-38-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-37-A
|
REMIC
I Remittance Rate
|
|||
|
45
|
I-39-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-38-A
|
REMIC
I Remittance Rate
|
|||
|
46
|
I-40-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-39-A
|
REMIC
I Remittance Rate
|
|||
|
47
|
I-41-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-40-A
|
REMIC
I Remittance Rate
|
|||
|
48
|
I-42-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-41-A
|
REMIC
I Remittance Rate
|
|||
|
59
|
I-43-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-42-A
|
REMIC
I Remittance Rate
|
|||
|
50
|
I-44-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-43-A
|
REMIC
I Remittance Rate
|
|||
|
51
|
I-45-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
69
|
Distribution
Date
|
REMIC
I Regular Interest
|
Rate
|
||
|
I-1-A
through I-44-A
|
REMIC
I Remittance Rate
|
|||
|
52
|
I-46-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-45-A
|
REMIC
I Remittance Rate
|
|||
|
51
|
I-47-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-46-A
|
REMIC
I Remittance Rate
|
|||
|
51
|
I-48-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-47-A
|
REMIC
I Remittance Rate
|
|||
|
55
|
I-49-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-48-A
|
REMIC
I Remittance Rate
|
|||
|
56
|
I-50-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-49-A
|
REMIC
I Remittance Rate
|
|||
|
57
|
I-51-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-50-A
|
REMIC
I Remittance Rate
|
|||
|
58
|
I-52-A
through I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-51-A
|
REMIC
I Remittance Rate
|
|||
|
59
|
I-53-A
and I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-52-A
|
REMIC
I Remittance Rate
|
|||
|
60
|
I-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
I-1-A
through I-53-A
|
REMIC
I Remittance Rate
|
|||
|
thereafter
|
I-1-A
through I-54-A
|
REMIC
I Remittance Rate
|
With
respect to REMIC II Regular Interest II-GRP, a per annum rate (but not less
than
zero) equal to the weighted average of: (w) with respect to REMIC I Regular
Interest II, the REMIC I Remittance Rate for such REMIC I Regular Interest
for
each such Distribution Date, (x) with respect to REMIC I Group II Regular
Interests ending with the designation “B”, the weighted average of the REMIC I
Remittance Rates for such REMIC I Regular Interests, weighted on the basis
of
the Uncertificated Balances of each such REMIC I Regular Interest for each
such
Distribution Date and (y) with respect to REMIC I Group II Regular Interests
ending with the designation “A”, for each Distribution Date listed below, the
weighted average of the rates listed below for such REMIC I Regular Interests
listed below, weighted on the basis of the Uncertificated Balances of each
such
REMIC I Regular Interest for each such Distribution Date:
|
Distribution
Date
|
REMIC
I Regular Interest
|
Rate
|
||
|
1st
through 6th
|
II-1-A
through II-54-A
|
REMIC
I Remittance Rate
|
||
70
|
Distribution
Date
|
REMIC
I Regular Interest
|
Rate
|
||
|
7
|
II-1-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
8
|
II-2-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
|
REMIC
I Remittance Rate
|
|||
|
9
|
II-3-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
and II-2-A
|
REMIC
I Remittance Rate
|
|||
|
10
|
II-4-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-3-A
|
REMIC
I Remittance Rate
|
|||
|
11
|
II-5-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-4-A
|
REMIC
I Remittance Rate
|
|||
|
12
|
II-6-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-5-A
|
REMIC
I Remittance Rate
|
|||
|
13
|
II-7-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-6-A
|
REMIC
I Remittance Rate
|
|||
|
14
|
II-8-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-7-A
|
REMIC
I Remittance Rate
|
|||
|
15
|
II-9-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-8-A
|
REMIC
I Remittance Rate
|
|||
|
16
|
II-10-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-9-A
|
REMIC
I Remittance Rate
|
|||
|
17
|
II-11-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-10-A
|
REMIC
I Remittance Rate
|
|||
|
18
|
II-12-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-11-A
|
REMIC
I Remittance Rate
|
|||
|
19
|
II-13-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-12-A
|
REMIC
I Remittance Rate
|
|||
|
20
|
II-14-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-13-A
|
REMIC
I Remittance Rate
|
|||
|
21
|
II-15-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-14-A
|
REMIC
I Remittance Rate
|
|||
|
22
|
II-16-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
71
|
Distribution
Date
|
REMIC
I Regular Interest
|
Rate
|
||
|
II-1-A
through II-15-A
|
REMIC
I Remittance Rate
|
|||
|
23
|
II-17-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-16-A
|
REMIC
I Remittance Rate
|
|||
|
24
|
II-18-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-17-A
|
REMIC
I Remittance Rate
|
|||
|
25
|
II-19-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-18-A
|
REMIC
I Remittance Rate
|
|||
|
26
|
II-20-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-19-A
|
REMIC
I Remittance Rate
|
|||
|
27
|
II-21-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-20-A
|
REMIC
I Remittance Rate
|
|||
|
28
|
II-22-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-21-A
|
REMIC
I Remittance Rate
|
|||
|
29
|
II-23-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-22-A
|
REMIC
I Remittance Rate
|
|||
|
30
|
II-24-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-23-A
|
REMIC
I Remittance Rate
|
|||
|
31
|
II-25-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-24-A
|
REMIC
I Remittance Rate
|
|||
|
32
|
II-26-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-25-A
|
REMIC
I Remittance Rate
|
|||
|
33
|
II-27-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-26-A
|
REMIC
I Remittance Rate
|
|||
|
34
|
II-28-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-27-A
|
REMIC
I Remittance Rate
|
|||
|
35
|
II-29-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-28-A
|
REMIC
I Remittance Rate
|
|||
|
36
|
II-30-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-29-A
|
REMIC
I Remittance Rate
|
|||
|
37
|
II-31-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
72
|
Distribution
Date
|
REMIC
I Regular Interest
|
Rate
|
||
|
II-1-A
through II-30-A
|
REMIC
I Remittance Rate
|
|||
|
38
|
II-32-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-31-A
|
REMIC
I Remittance Rate
|
|||
|
39
|
II-33-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-32-A
|
REMIC
I Remittance Rate
|
|||
|
40
|
II-34-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-33-A
|
REMIC
I Remittance Rate
|
|||
|
41
|
II-35-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-34-A
|
REMIC
I Remittance Rate
|
|||
|
42
|
II-36-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-35-A
|
REMIC
I Remittance Rate
|
|||
|
43
|
II-37-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-36-A
|
REMIC
I Remittance Rate
|
|||
|
44
|
II-38-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-37-A
|
REMIC
I Remittance Rate
|
|||
|
45
|
II-39-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-38-A
|
REMIC
I Remittance Rate
|
|||
|
46
|
II-40-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-39-A
|
REMIC
I Remittance Rate
|
|||
|
47
|
II-41-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-40-A
|
REMIC
I Remittance Rate
|
|||
|
48
|
II-42-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-41-A
|
REMIC
I Remittance Rate
|
|||
|
59
|
II-43-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-42-A
|
REMIC
I Remittance Rate
|
|||
|
50
|
II-44-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-43-A
|
REMIC
I Remittance Rate
|
|||
|
51
|
II-45-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-44-A
|
REMIC
I Remittance Rate
|
|||
|
52
|
II-46-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
73
|
Distribution
Date
|
REMIC
I Regular Interest
|
Rate
|
||
|
II-1-A
through II-45-A
|
REMIC
I Remittance Rate
|
|||
|
51
|
II-47-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-46-A
|
REMIC
I Remittance Rate
|
|||
|
51
|
II-48-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-47-A
|
REMIC
I Remittance Rate
|
|||
|
55
|
II-49-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-48-A
|
REMIC
I Remittance Rate
|
|||
|
56
|
II-50-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-49-A
|
REMIC
I Remittance Rate
|
|||
|
57
|
II-51-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-50-A
|
REMIC
I Remittance Rate
|
|||
|
58
|
II-52-A
through II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-51-A
|
REMIC
I Remittance Rate
|
|||
|
59
|
II-53-A
and II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-52-A
|
REMIC
I Remittance Rate
|
|||
|
60
|
II-54-A
|
2
multiplied by Swap LIBOR, subject to a maximum rate of REMIC I Remittance
Rate
|
||
|
II-1-A
through II-53-A
|
REMIC
I Remittance Rate
|
|||
|
thereafter
|
II-1-A
through II-54-A
|
REMIC
I Remittance Rate
|
With
respect to REMIC II Regular Interest IO, and (i) the 1st Distribution Date
through the 6th Distribution Date, the excess of (x) the weighted average of
the
REMIC I Remittance Rates for REMIC I Regular Interests including the designation
“A”, over (y) the weighted average of the REMIC I Remittance Rates for REMIC I
Regular Interests including the designation “A”, (ii) the 7th Distribution Date
through the 60th
Distribution Date, the excess of (x) the weighted average of the REMIC I
Remittance Rates for REMIC I Regular Interests including the designation “A”,
over (y) 2 multiplied by Swap LIBOR and (iii) thereafter, 0.00%.
“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 I-SUB, REMIC II Regular Interest I-GRP,
REMIC II Regular Interest II-SUB, REMIC II Regular Interest II-GRP and REMIC
II
Regular Interest XX.
“REMIC
II Subordinated Balance Ratio”:
The
ratio among the Uncertificated Balances of each REMIC II Regular Interest ending
with the designation “SUB,”, equal to the ratio 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 or Group II Mortgage Loans, as applicable
over (y) the current Certificate Principal Balance of related Class A
Certificates.
74
“REMIC
II Required Overcollateralization Amount”:
0.50%
of the Required 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
Provisions”:
Provisions of the federal income tax law relating to real estate mortgage
investment conduits, which appear at Section 860A through 860G of the Code,
and
related provisions, and proposed, temporary and final regulations and published
rulings, notices and announcements promulgated thereunder, as the foregoing
may
be in effect from time to time.
“REMIC
Regular Interest”:
Any
REMIC I Regular Interest or REMIC II Regular Interest.
“REMIC
Remittance Rate”:
The
REMIC I Remittance Rate or the REMIC II Remittance Rate.
“Remittance
Report”:
A
report by the Servicer pursuant to Section 5.03(a) of this
Agreement.
“Rents
from Real Property”:
With
respect to any REO Property, gross income of the character described in Section
856(d) of the Code as being included in the term “rents from real
property.”
“REO
Account”:
The
account or accounts maintained, or caused to be maintained, by the Servicer
in
respect of an REO Property pursuant to Section 3.22 of this
Agreement.
“REO
Disposition”:
The
sale or other disposition of an REO Property on behalf of REMIC I.
“REO
Imputed Interest”:
As to
any REO Property, for any calendar month during which such REO Property was
at
any time part of REMIC I, one month’s interest at the applicable Net Mortgage
Rate on the Stated Principal Balance of such REO Property (or, in the case
of
the first such calendar month, of the related Mortgage Loan, if appropriate)
as
of the close of business on the Distribution Date in such calendar
month.
“REO
Principal Amortization”:
With
respect to any REO Property, for any calendar month, the excess, if any, of
(a)
the aggregate of all amounts received in respect of such REO Property during
such calendar month, whether in the form of rental income, sale proceeds
(including, without limitation, that portion of the Termination Price paid
in
connection with a purchase of all of the Mortgage Loans and REO Properties
pursuant to Section 10.01 of this Agreement that is allocable to such REO
Property) or otherwise, net of any portion of such amounts (i) payable in
respect of the proper operation, management and maintenance of such REO Property
or (ii) payable or reimbursable to the Servicer pursuant to Section 3.22(d)
of
this Agreement for unpaid Servicing Fees in respect of the related Mortgage
Loan
and unreimbursed Servicing Advances and P&I Advances in respect of such REO
Property or the related Mortgage Loan, over (b) the REO Imputed Interest in
respect of such REO Property for such calendar month.
75
“REO
Property”:
A
Mortgaged Property acquired by the Servicer or its nominee on behalf of REMIC
I
through foreclosure or deed-in-lieu of foreclosure, as described in Section
3.22
of this Agreement.
“Reportable
Event”:
Has
the meaning set forth in Section 5.06(b) of this Agreement.
“Required
Overcollateralization Amount”:
With
respect to any Distribution Date (i) prior to the Stepdown Date, the product
of
(A) 4.00% and (B) the aggregate principal balance of the Mortgage Loans as
of
the Cut-off Date, (ii) on or after the Stepdown Date provided a Trigger Event
is
not in effect, the greater of (x) 8.00% of the aggregate Stated Principal
Balance of the Mortgage Loans (after giving effect to principal payments to
be
distributed on such Distribution Date) and (y) an amount equal to the product
of
(A) 0.50% and (B) the aggregate principal balance of the Mortgage Loans as
of
the Cut-off Date, and (iii) on or after the Stepdown Date and a Trigger Event
is
in effect, the Required Overcollateralization Amount for the immediately
preceding Distribution Date. Notwithstanding the foregoing, on and after any
Distribution Date following the reduction of the aggregate Certificate Principal
Balance of the Class A Certificates and Mezzanine Certificates to zero, the
Required Overcollateralization Amount shall be zero.
“Reserve
Fund”:
A fund
created pursuant to Section 3.25 which shall be an asset of the Trust Fund
but
which shall not be an asset of any Trust REMIC.
“Reserve
Interest Rate”:
With
respect to any Interest Determination Date, the rate per annum that the
Securities Administrator determines to be either (i) the arithmetic mean
(rounded upwards if necessary to the nearest whole multiple of 1/16%) of the
one-month U.S. dollar lending rates which New York City banks selected by the
Securities Administrator, after consultation with the Depositor, are quoting
on
the relevant Interest Determination Date to the principal London offices of
leading banks in the London interbank market or (ii) in the event that the
Securities Administrator can determine no such arithmetic mean, the lowest
one-month U.S. dollar lending rate which New York City banks selected by the
Securities Administrator are quoting on such Interest Determination Date to
leading European banks.
“Residential
Dwelling”:
Any
one of the following: (i) a detached one-family dwelling, (ii) a detached two-
to four-family dwelling, (iii) a one-family dwelling unit in a Xxxxxx Xxx
eligible condominium project, (iv) a detached one-family dwelling in a planned
unit development or (v) a townhouse, none of which is a co-operative or mobile
home.
76
“Residual
Certificate”:
Any
one of the Class R Certificates.
“Residual
Interest”:
The
sole class of “residual interests” in a REMIC within the meaning of Section
860G(a)(2) of the Code.
“Responsible
Officer”:
When
used with respect to the Trustee, any officer of the Trustee having direct
responsibility for the administration of this Agreement and, with respect to
a
particular matter, to whom such matter is referred because of such officer’s
knowledge of and familiarity with the particular subject.
“Rule
144A”:
Rule
144A under the Securities Act.
“S&P”:
Standard & Poor’s Ratings Services, a division of the XxXxxx-Xxxx Companies,
Inc.
“Xxxxxxxx-Xxxxx
Act”:
Means
the Xxxxxxxx-Xxxxx Act of 2002 and the rules and regulations of the Commission
promulgated thereunder (including any interpretations thereof by the
Commission’s staff).
“Xxxxxxxx-Xxxxx
Certification”:
A
written certification signed by an officer of the Master Servicer that complies
with (i) the Xxxxxxxx-Xxxxx Act of 2002, as amended from time to time, and
(ii)
Exchange Act Rules 13a-14(d) and 15d-14(d), as in effect from time to time;
provided that if, after the Closing Date (a) the Xxxxxxxx-Xxxxx Act of 2002
is
amended, (b) the Rules referred to in clause (ii) are modified or superseded
by
any subsequent statement, rule or regulation of the Commission or any statement
of a division thereof, or (c) any future releases, rules and regulations are
published by the Commission from time to time pursuant to the Xxxxxxxx-Xxxxx
Act
of 2002, which in any such case affects the form or substance of the required
certification and results in the required certification being, in the reasonable
judgment of the Master Servicer, materially more onerous that then form of
the
required certification as of the Closing Date, the Xxxxxxxx-Xxxxx Certification
shall be as agreed to by the Master Servicer, the Depositor and the Sponsor
following a negotiation in good faith to determine how to comply with any such
new requirements.
“Scheduled
Principal Balance”:
With
respect to any Mortgage Loan: (a) as of the Cut-off Date, the outstanding
principal balance of such Mortgage Loan as of such date, net of the principal
portion of all unpaid Monthly Payments, if any, due on or before such date;
(b)
as of any Due Date subsequent to the Cut-off Date up to and including the Due
Date in the calendar month in which a Liquidation Event occurs with respect
to
such Mortgage Loan, the Scheduled Principal Balance of such Mortgage Loan as
of
the Cut-off Date, minus the sum of (i) the principal portion of each Monthly
Payment due on or before such Due Date but subsequent to the Cut-off Date,
whether or not received, (ii) all Principal Prepayments received before such
Due
Date but after the Cut-off Date, (iii) the principal portion of all Liquidation
Proceeds and Insurance Proceeds received before such Due Date but after the
Cut-off Date, net of any portion thereof that represents principal due (without
regard to any acceleration of payments under the related Mortgage and Mortgage
Note) on a Due Date occurring on or before the date on which such proceeds
were
received and (iv) any Realized Loss incurred with respect thereto as a result
of
a Deficient Valuation occurring before such Due Date, but only to the extent
such Realized Loss represents a reduction in the portion of principal of such
Mortgage Loan not yet due (without regard to any acceleration of payments under
the related Mortgage and Mortgage Note) as of the date of such Deficient
Valuation; and (c) as of any Due Date subsequent to the occurrence of a
Liquidation Event with respect to such Mortgage Loan, zero. With respect to
any
REO Property: (a) as of any Due Date subsequent to the date of its acquisition
on behalf of the Trust Fund up to and including the Due Date in the calendar
month in which a Liquidation Event occurs with respect to such REO Property,
an
amount (not less than zero) equal to the Scheduled Principal Balance of the
related Mortgage Loan as of the Due Date in the calendar month in which such
REO
Property was acquired, minus the aggregate amount of REO Principal Amortization,
if any, in respect of REO Property for all previously ended calendar months;
and
(b) as of any Due Date subsequent to the occurrence of a Liquidation Event
with
respect to such REO Property, zero.
77
“Securities
Act”:
The
Securities Act of 1933, as amended, and the rules and regulations
thereunder.
“Securities
Administrator”:
As of
the Closing Date, Xxxxx Fargo Bank, National Association and thereafter, its
respective successors in interest that meet the qualifications of this
Agreement. The Securities Administrator and the Master Servicer shall at all
times be the same Person or Affiliates.
“Senior
Interest Distribution Amount”:
With
respect to any Distribution Date, an amount equal to the sum of (i) the Interest
Distribution Amount for such Distribution Date for the Class A Certificates
and
(ii) the Interest Carry Forward Amount, if any, for such Distribution Date
for
the Class A Certificates.
“Servicer”:
Ocwen
Loan Servicing, LLC, or any successor thereto appointed hereunder in connection
with the servicing and administration of the Mortgage Loans.
“Servicer
Event of Default”:
One or
more of the events described in Section 8.01(a).
“Servicer
Remittance Date”:
With
respect to any Distribution Date, by 12:00 p.m. New York time on the 22nd day
of
each month in which such Distribution Date occurs; provided that if such 22nd
day of a given month is not a Business Day, the Servicer Remittance Date for
such month shall be the Business Day immediately preceding such 22nd
day.
“Servicer
Report”:
A
report (substantially in the form of Schedule 5 hereto) or otherwise in form
and
substance acceptable to the Master Servicer and Securities Administrator on
an
electronic data file or tape prepared by the Servicer pursuant to Section
5.03(a) of this Agreement, with such additions, deletions and modifications
as
agreed to by the Master Servicer, the Securities Administrator and the
Servicer.
“Service(s)(ing)”:
Means,
in accordance with Regulation AB, the act of servicing and administering the
Mortgage Loans or any other assets of the Trust by an entity that meets the
definition of “servicer’ set forth in Item 1101 of Regulation AB and is subject
to the disclosure requirements set forth in Item 1108 of Regulation AB. For
clarification purposes, any uncapitalized occurrence of this term shall have
the
meaning commonly understood by participants in the residential mortgage-backed
securitization market.
78
“Servicing
Advances”:
The
customary and reasonable “out-of-pocket” costs and expenses incurred prior to or
on or after the Cut-off Date (the amounts incurred prior to the Cut-off Date
shall be identified on the Servicing Advance Schedule by (a) the Servicer with
respect to any Mortgage Loans that were transferred to the Servicer prior to
the
Cut-off Date and/or (b) the Depositor with respect to any Mortgage Loans that
were transferred to the Servicer after the Cut-off Date, as applicable) by
the
Servicer in connection with a default, delinquency or other unanticipated event
by the Servicer in the performance of its servicing obligations, including,
but
not limited to, the cost of (i) the preservation, restoration and protection
of
a Mortgaged Property, (ii) any enforcement or judicial proceedings, including
but not limited to foreclosures, in respect of a particular Mortgage Loan,
including any expenses incurred in relation to any such proceedings that result
from the Mortgage Loan being registered on the MERS® System, (iii) the
management (including reasonable fees in connection therewith) and liquidation
of any REO Property, (iv) the performance of its obligations under
Section 3.01, Section 3.07, Section 3.11, Section 3.13 and
Section 3.22 of this Agreement; (v) refunding to any Mortgagor the portion
of any prepaid origination fees or finance charges that are subject to
reimbursement upon a principal prepayment of the related Mortgage Loan to the
extent such refund is required by applicable law; and (vi) obtaining any legal
documentation required to be included in the Mortgage File and/or correcting
any
outstanding title issues (i.e., any lien or encumbrance on the Mortgaged
Property that prevents the effective enforcement of the intended lien position)
reasonably necessary for the Servicer to perform its obligations under this
Agreement. Servicing Advances also include any reasonable “out-of-pocket” cost
and expenses (including legal fees) incurred by the Servicer in connection
with
executing and recording instruments of satisfaction, deeds of reconveyance
or
Assignments to the extent not recovered from the Mortgagor or otherwise payable
under this Agreement. The Servicer shall not be required to make any
Nonrecoverable Servicing Advances.
“Servicing
Advance Schedule”:
With
respect to any Servicing Advances incurred prior to the Cut-off Date, the
schedule or schedules provided by (a) the Servicer with respect to any Mortgage
Loans that were transferred to the Servicer prior to the Cut-off Date and/or
(b)
the Depositor with respect to any Mortgage Loans that were transferred to the
Servicer after the Cut-off Date, as applicable, to the Master Servicer and,
if
such schedule is provided by the Depositor, to the Servicer, on the date on
which the Servicer seeks reimbursement for a Servicing Advance made by the
Servicer, which schedule or schedules shall contain the information set forth
on
Schedule 6.
“Servicing
Criteria”:
Means
the criteria set forth in paragraph (d) of Item 1122 of Regulation AB, as such
may be amended from time to time.
“Servicing
Fee”:
With
respect to each Mortgage Loan and for any calendar month, an amount equal to
one-twelfth of the product of the Servicing Fee Rate multiplied by the Scheduled
Principal Balance of the Mortgage Loans as of the Due Date in the preceding
calendar month. The Servicing Fee is payable solely from collections of interest
on the Mortgage Loans, except as otherwise provided in Section 3.09 of this
Agreement.
79
“Servicing
Fee Rate”:
0.50%
per annum.
“Servicing
Function Participant”:
Means
any Sub-Servicer, Subcontractor or any other Person engaged by a party hereto,
that is determined to be “participating in the servicing function” within the
meaning of Item 1122 of Regulation AB, without regard to any threshold
referenced therein.
“Servicing
Officer”:
Any
officer of the Servicer or the Master Servicer involved in, or responsible
for,
the administration and servicing of Mortgage Loans, whose name and specimen
signature appear on a list of Servicing Officers furnished by the Servicer
or
the Master Servicer, to the Trustee, the Master Servicer (in the case of the
Servicer), the Securities Administrator and the Depositor on the Closing Date,
as such list may from time to time be amended.
“Single
Certificate”:
With
respect to any Class of Certificates (other than the Residual Certificates),
a
hypothetical Certificate of such Class evidencing a Percentage Interest for
such
Class corresponding to an initial Certificate Principal Balance of $1,000.
With
respect to the Residual Certificates, a hypothetical Certificate of such Class
evidencing a 100% Percentage Interest in such Class.
“Sponsor”:
DB
Structured Products, Inc. or its successor in interest, in its capacity as
seller under the Mortgage Loan Purchase Agreement.
“Startup
Day”:
With
respect to each Trust REMIC, the day designated as such pursuant to Section
11.01(b) hereof.
“Stated
Principal Balance”:
With
respect to any Mortgage Loan: (a) as of any date of determination up to but
not
including the Distribution Date on which the proceeds, if any, of a Liquidation
Event with respect to such Mortgage Loan would be distributed, the Scheduled
Principal Balance of such Mortgage Loan as of the Cut-off Date, as shown in
the
Mortgage Loan Schedule, minus the sum of (i) the principal portion of each
Monthly Payment due on a Due Date subsequent to the Cut-off Date, to the extent
received from the Mortgagor or advanced by the Servicer or a successor to the
Servicer and distributed pursuant to Section 5.01 of this Agreement on or before
such date of determination, (ii) all Principal Prepayments received after the
Cut-off Date, to the extent distributed pursuant to Section 5.01 of this
Agreement on or before such date of determination, (iii) all Liquidation
Proceeds and Insurance Proceeds applied by the Servicer as recoveries of
principal in accordance with the provisions of Section 3.13 of this Agreement,
to the extent distributed pursuant to Section 5.01 of this Agreement on or
before such date of determination, and (iv) any Realized Loss incurred with
respect thereto as a result of a Deficient Valuation made during or prior to
the
Prepayment Period for the most recent Distribution Date coinciding with or
preceding such date of determination; and (b) as of any date of determination
coinciding with or subsequent to the Distribution Date on which the proceeds,
if
any, of a Liquidation Event with respect to such Mortgage Loan would be
distributed, zero. With respect to any REO Property: (a) as of any date of
determination up to but not including the Distribution Date on which the
proceeds, if any, of a Liquidation Event with respect to such REO Property
would
be distributed, an amount (not less than zero) equal to the Stated Principal
Balance of the related Mortgage Loan as of the date on which such REO Property
was acquired on behalf of REMIC I, minus the sum of (i) if such REO Property
was
acquired before the Distribution Date in any calendar month, the principal
portion of the Monthly Payment due on the Due Date in the calendar month of
acquisition, to the extent advanced by the Servicer or a successor to the
Servicer and distributed pursuant to Section 5.01 of this Agreement, on or
before such date of determination and (ii) the aggregate amount of REO Principal
Amortization in respect of such REO Property for all previously ended calendar
months, to the extent distributed pursuant to Section 5.01 of this Agreement
on
or before such date of determination; and (b) as of any date of determination
coinciding with or subsequent to the Distribution Date on which the proceeds,
if
any, of a Liquidation Event with respect to such REO Property would be
distributed, zero.
80
“Stepdown
Date”:
The
earlier to occur of (i) the later to occur of (a) the Distribution Date
occurring in April 2010 and (b) the first Distribution Date on which the Credit
Enhancement Percentage (calculated for this purpose only after taking into
account distributions of principal on the Mortgage Loans, but prior to any
distribution of the Principal Distribution Amount to the holders of the
Certificates then entitled to distributions of principal on such Distribution
Date), is greater than or equal to 40.20% and (ii) the first Distribution Date
on which the aggregate Certificate Principal Balance of the Class A Certificates
has been reduced to zero.
“Subcontractor”:
Means
any vendor, subcontractor or other Person that is not responsible for the
overall servicing of Mortgage Loans but performs one or more discrete functions
identified in Item 1122(d) of Regulation AB (without regard to any threshold
percentage specified therein) with respect to Mortgage Loans under the direction
or authority of any Servicer (or a Sub-Servicer of any Servicer), the Master
Servicer, the Trustee, a Custodian or the Securities Administrator.
“Subordinate
Certificates”:
Collectively, the Mezzanine Certificates and the Class CE
Certificates.
“Subsequent
Recoveries”:
As of
any Distribution Date, amounts received during the related Prepayment Period
by
the Servicer specifically related to a defaulted Mortgage Loan or disposition
of
an REO Property prior to the related Prepayment Period that resulted in a
Realized Loss after the liquidation or disposition of such defaulted Mortgage
Loan, net of any amounts reimbursable to the Servicer related to such Mortgage
Loan or REO Property.
“Sub-Servicer”:
Means
any Person that services Mortgage Loans on behalf of any Servicer and is
responsible for the performance (whether directly or through sub-servicers
or
Subcontractors) of a substantial portion of the material servicing functions
required to be performed under this Agreement or any related Sub-Servicing
Agreement that is identified in Item 1122(d) of Regulation AB.
“Sub-Servicing
Agreement”:
The
written contract between the Servicer and a Sub-Servicer relating to servicing
and administration of certain Mortgage Loans as provided in Section 3.02 of
this
Agreement.
“Substitution
Shortfall Amount”:
As
defined in Section 2.03.
“Supplemental
Interest Trust”:
The
corpus of a trust created pursuant to Section 5.07 of this Agreement and
designated as the “Supplemental Interest Trust,” consisting of the Swap
Agreement, the Class IO Interest and the right to receive payments in respect
of
the Class IO Distribution Amount. For the avoidance of doubt, the Supplemental
Interest Trust does not constitute a part of the Trust Fund.
81
“Supplemental
Interest Trust Trustee”:
HSBC
Bank USA, National Association a national banking association, or its successor
in interest, or any successor supplemental interest trust trustee appointed
as
provided herein or in the Swap Agreement provided.
“Swap
Agreement”:
The
Interest Rate Swap Agreement, dated as of March 30, 2007, between the
Supplemental Interest Trust Trustee, and the Swap Provider, including any
schedule, confirmations, credit support annex or other credit support document
relating thereto, and attached hereto as Exhibit I.
“Swap
Credit Support Annex:
The
credit support annex, dated as of March 30, 2007, between the Supplemental
Interest Trust Trustee and the Swap Provider, which is annexed to and forms
part
of the Swap Agreement.
“Swap
LIBOR”:
LIBOR
as determined pursuant to the Swap Agreement.
“Swap
Notional Amount”:
For
each calculation period as defined in the Swap Agreement, the lesser of (i)
the
aggregate Certificate Principal Balance of the Offered Certificates and (ii)
the
amount set forth below:
|
Distribution
Date
|
Swap
Notional Amount ($)
|
|
|
October
2007
|
666,415,204.00
|
|
|
November
2007
|
643,170,595.00
|
|
|
December
2007
|
618,333,656.00
|
|
|
January
2008
|
592,182,982.00
|
|
|
February
2008
|
567,111,935.00
|
|
|
March
2008
|
543,075,775.00
|
|
|
April
2008
|
520,031,625.00
|
|
|
May
2008
|
497,938,388.00
|
|
|
June
2008
|
476,756,676.00
|
|
|
July
2008
|
456,448,739.00
|
|
|
August
2008
|
436,978,395.00
|
82
|
Distribution
Date
|
Swap
Notional Amount ($)
|
|
|
September
2008
|
418,310,965.00
|
|
|
October
2008
|
400,371,355.00
|
|
|
November
2008
|
383,178,704.00
|
|
|
December
2008
|
364,967,665.00
|
|
|
January
2009
|
309,569,380.00
|
|
|
February
2009
|
263,493,321.00
|
|
|
March
2009
|
225,077,617.00
|
|
|
April
2009
|
193,763,410.00
|
|
|
May
2009
|
184,421,749.00
|
|
|
June
2009
|
175,501,123.00
|
|
|
July
2009
|
166,982,263.00
|
|
|
August
2009
|
158,848,514.00
|
|
|
September
2009
|
151,080,372.00
|
|
|
October
2009
|
143,661,112.00
|
|
|
November
2009
|
136,574,794.00
|
|
|
December
2009
|
129,806,201.00
|
|
|
January
2010
|
123,340,846.00
|
|
|
February
2010
|
117,165,338.00
|
|
|
March
2010
|
111,265,985.00
|
|
|
April
2010
|
105,630,211.00
|
|
|
May
2010
|
100,246,020.00
|
|
|
June
2010
|
95,101,971.00
|
|
|
July
2010
|
90,187,153.00
|
|
|
August
2010
|
85,491,191.00
|
83
|
Distribution
Date
|
Swap
Notional Amount ($)
|
|
|
September
2010
|
81,004,119.00
|
|
|
October
2010
|
76,716,464.00
|
|
|
November
2010
|
72,619,195.00
|
|
|
December
2010
|
68,703,692.00
|
|
|
January
2011
|
64,961,734.00
|
|
|
February
2011
|
61,385,480.00
|
|
|
March
2011
|
57,967,444.00
|
|
|
April
2011
|
54,700,488.00
|
|
|
May
2011
|
51,577,799.00
|
|
|
June
2011
|
48,592,878.00
|
|
|
July
2011
|
45,739,525.00
|
|
|
August
2011
|
43,011,821.00
|
|
|
September
2011
|
40,404,121.00
|
|
|
October
2011
|
37,911,037.00
|
|
|
November
2011
|
35,527,425.00
|
|
|
December
2011
|
33,248,380.00
|
|
|
January
2012
|
31,068,847.00
|
|
|
February
2012
|
28,983,740.00
|
|
|
March
2012
|
26,989,900.00
|
“Swap
Provider”:
The
swap provider under the Swap Agreement either (a) entitled to receive payments
from the Supplemental Interest Trust or (b) required to make payments to the
Supplemental Interest Trust, in either case pursuant to the terms of the Swap
Agreement, and any successor in interest or assign. Initially, the Swap Provider
shall be Deutsche Bank AG, New York Branch.
“Swap
Provider Trigger Event”:
A Swap
Provider Trigger Event shall have occurred if any of the following has occurred:
(i) an Event of Default under the Swap Agreement with respect to which the
Swap
Provider is a Defaulting Party (as defined in the Swap Agreement), (ii) a
Termination Event under the Swap Agreement with respect to which the Swap
Provider is the sole Affected Party (as defined in the Swap Agreement) or (iii)
an Additional Termination Event under the Swap Agreement with respect to which
the Swap Provider is the sole Affected Party.
84
“Swap
Termination Payment”:
Upon
the designation of an “Early Termination Date” as defined in the Swap Agreement,
the payment to be made by the Securities Administrator on behalf of the
Supplemental Interest Trust Trustee from the Supplemental Interest Trust to
the
Swap Provider, or by the Swap Provider to the Supplemental Interest Trust,
as
applicable, pursuant to the terms of the Swap Agreement.
“Tax
Returns”:
The
federal income tax return on Internal Revenue Service Form 1066, U.S. Real
Estate Mortgage Investment Conduit Income Tax Return, including Schedule Q
thereto, Quarterly Notice to Residual Interest Holders of REMIC Taxable Income
or Net Loss Allocation, or any successor forms, to be filed on behalf of the
Trust REMICs under the REMIC Provisions, together with any and all other
information reports or returns that may be required to be furnished to the
Certificateholders or filed with the Internal Revenue Service or any other
governmental taxing authority under any applicable provisions of federal, state
or local tax laws.
“Telerate
Page 3750”:
The
display designated as page “3750” on the Dow Xxxxx Telerate Capital Markets
Report (or such other page as may replace page 3750 on that report for the
purpose of displaying London interbank offered rates of major
banks).
“Termination
Price”:
As
defined in Section 10.01.
“Terminator”:
As
defined in Section 10.01.
“Transfer”:
Any
direct or indirect transfer, sale, pledge, hypothecation, or other form of
assignment of any Ownership Interest in a Certificate.
“Transferee”:
Any
Person who is acquiring by Transfer any Ownership Interest in a
Certificate.
“Transferor”:
Any
Person who is disposing by Transfer of any Ownership Interest in a
Certificate.
“Trigger
Event”:
With
respect to any Distribution Date, a Trigger Event is in effect if (x) the
percentage obtained by dividing (i) the principal amount of Mortgage Loans
delinquent 60 days or more (including Mortgage Loans in foreclosure, bankruptcy
and REO) by (ii) the aggregate principal balance of the Mortgage Loans, in
each
case as, of the last day of the previous calendar month exceeds approximately
39.80% of the Credit Enhancement Percentage with respect to such Distribution
Date or (y) the aggregate amount of Realized Losses incurred since the Cut-off
Date through the last day of the related Due Period divided by the aggregate
principal balance of the Mortgage Loans as of the Cut-off exceeds the applicable
percentages set forth below with respect to such Distribution Date:
|
Distribution
Date
|
Percentages
|
|
|
April
2009 to March 2010
|
1.55%
plus 1/12 of 1.80% for each month thereafter
|
|
|
April
2010 to March 2011
|
3.35%
plus 1/12 of 1.85% for each month thereafter
|
|
|
April
2011 to March 2012
|
5.20%
plus 1/12 of 1.45% for each month thereafter
|
|
|
April
2012 to March 2013
|
6.65%
plus 1/12 of 0.80% for each month thereafter
|
|
|
April
2013 and thereafter
|
7.45%
|
85
“Trust”:
ACE
Securities Corp., Home Equity Loan Trust, Series 2007-WM2, the trust created
hereunder.
“Trust
Fund”:
Collectively, all of the assets of REMIC I, REMIC II, REMIC III and the Reserve
Fund and any amounts on deposit therein and any proceeds thereof and the Cap
Contracts. For avoidance of doubt, the Trust Fund does not include the
Supplemental Interest Trust.
“Trust
REMIC”:
REMIC
I, REMIC II or REMIC III.
“Trustee”:
HSBC
Bank USA, National Association, a national banking association, or its successor
in interest, or any successor trustee appointed as herein provided.
“Uncertificated
Balance”:
The
amount of the REMIC Regular Interests outstanding as of any date of
determination. As of the Closing Date, the Uncertificated Balance of each REMIC
Regular Interest shall equal the amount set forth in the Preliminary Statement
hereto as its initial uncertificated balance. On each Distribution Date, the
Uncertificated Balance of the REMIC Regular Interest shall be reduced by all
distributions of principal made on such REMIC Regular Interest on such
Distribution Date pursuant to Section 5.01 and, if and to the extent necessary
and appropriate, shall be further reduced on such Distribution Date by Realized
Losses as provided in Section 5.04 and the Uncertificated Balance of REMIC
II
Regular Interest ZZ shall be increased by interest deferrals as provided in
Section 5.01. The Uncertificated Balance of each REMIC Regular Interest shall
never be less than zero.
“Uncertificated
Interest”:
With
respect to any REMIC Regular Interest for any Distribution Date, one month’s
interest at the related REMIC Remittance Rate applicable to such REMIC Regular
Interest for such Distribution Date, accrued on the Uncertificated Balance
thereof immediately prior to such Distribution Date. Uncertificated Interest
in
respect of the REMIC Regular Interests shall accrue on the basis of a 360-day
year consisting of twelve 30-day months. Uncertificated Interest with respect
to
each Distribution Date, as to any REMIC Regular Interest, shall be reduced
by an
amount equal to the sum of (a) the aggregate Prepayment Interest Shortfall,
if
any, for such Distribution Date to the extent not covered by payments pursuant
to Section 3.23 or Section 4.19 of this Agreement and (b) the aggregate amount
of any Relief Act Interest Shortfall, if any allocated, in each case, to such
REMIC Regular Interest or REMIC Regular Interest pursuant to Section 1.02.
In
addition, Uncertificated Interest with respect to each Distribution Date, as
to
any REMIC Regular Interest, shall be reduced by Realized Losses, if any,
allocated to such REMIC Regular Interest pursuant to Section 1.02 and Section
5.04.
86
“Uninsured
Cause”:
Any
cause of damage to a Mortgaged Property such that the complete restoration
of
such property is not fully reimbursable by the hazard insurance policies
required to be maintained pursuant to Section 3.11.
“United
States Person”:
A
citizen or resident of the United States, a corporation, partnership or other
entity created or organized in, or under the laws of, the United States or
any
political subdivision thereof (except, in the case of a partnership, to the
extent provided in regulations) provided that, for purposes solely of the
restrictions on the transfer of any Class R Certificate, no partnership or
other
entity treated as a partnership for United States federal income tax purposes
shall be treated as a United States Person unless all persons that own an
interest in such partnership either directly or through any entity that is
not a
corporation for United States federal income tax purposes are required to be
United States Persons, or an estate whose income is subject to United States
federal income tax regardless of its source, or a trust if a court within the
United States is able to exercise primary supervision over the administration
of
the trust and one or more United States persons have the authority to control
all substantial decisions of the trust. To the extent prescribed in regulations
by the Secretary of the Treasury, a trust which was in existence on August
20,
1996 (other than a trust treated as owned by the grantor under subpart E of
part
I of subchapter J of chapter I of the Code), and which was treated as a United
States person on August 20, 1996 may elect to continue to be treated as a United
States person notwithstanding the previous sentence. The term “United States”
shall have the meaning set forth in Section 7701 of the Code.
“Value”:
With
respect to any Mortgaged Property, the lesser of (i) the lesser of (a) the
value
thereof as determined by an appraisal made for the related originator of the
Mortgage Loan at the time of origination of the Mortgage Loan by an appraiser
who met the minimum requirements of Xxxxxx Mae and Xxxxxxx Mac and (b) the
value
thereof as determined by a review appraisal conducted by the related originator
of the Mortgage Loan in accordance with the related originator’s underwriting
guidelines, and (ii) the purchase price paid for the related Mortgaged Property
by the Mortgagor with the proceeds of the Mortgage Loan; provided, however,
(A)
in the case of a Refinanced Mortgage Loan, such value of the Mortgaged Property
is based solely upon the lesser of (1) the value determined by an appraisal
made
for the related originator of the Mortgage Loan of such Refinanced Mortgage
Loan
at the time of origination of such Refinanced Mortgage Loan by an appraiser
who
met the minimum requirements of Xxxxxx Mae and Xxxxxxx Mac and (2) the value
thereof as determined by a review appraisal conducted by the related originator
of the Mortgage Loan in accordance with the related originator’s underwriting
guidelines, and (B) in the case of a Mortgage Loan originated in connection
with
a “lease-option purchase,” such value of the Mortgaged Property is based on the
lower of the value determined by an appraisal made for the originator of such
Mortgage Loan at the time of origination or the sale price of such Mortgaged
Property if the “lease option purchase price” was set less than 12 months prior
to origination, and is based on the value determined by an appraisal made for
the related originator of such Mortgage Loan at the time of origination if
the
“lease option purchase price” was set 12 months or more prior to
origination.
“Verification
Report”:
As
defined in Section 4.20.
87
“Voting
Rights”:
The
portion of the voting rights of all of the Certificates which is allocated
to
any such Certificate. With respect to any date of determination, 98% of all
Voting Rights will be allocated among the holders of the Class A Certificates,
the Mezzanine Certificates and the Class CE Certificates in proportion to the
then outstanding Certificate Principal Balances of their respective
Certificates, 1% of all Voting Rights will be allocated among the holders of
the
Class P Certificates and 1% of all Voting Rights will be allocated among the
holders of the Class R Certificates. The Voting Rights allocated to each Class
of Certificate shall be allocated among Holders of each such Class in accordance
with their respective Percentage Interests as of the most recent Record
Date.
“Xxxxx
Fargo”:
Xxxxx
Fargo Bank, National Association in its capacity as a Custodian under the
Custodial Agreement, or any successor thereto.
SECTION
1.02. Allocation
of Certain Interest Shortfalls.
For
purposes of calculating the amount of Accrued Certificate Interest and the
amount of the Interest Distribution Amount for the Class A Certificates, the
Mezzanine Certificates and the Class CE Certificates for any Distribution Date,
(1) the aggregate amount of any Prepayment Interest Shortfalls (to the extent
not covered by payments by the Servicer pursuant to Section 3.23 of this
Agreement or by the Master Servicer pursuant to Section 4.19 of this Agreement)
and any Relief Act Interest Shortfalls incurred in respect of the Mortgage
Loans
for any Distribution Date shall be allocated first, to the Class CE
Certificates, second, to the Class M-9 Certificates, third, to the Class M-8
Certificates, fourth, to the Class M-7 Certificates, fifth, to the Class M-6
Certificates, sixth, to the Class M-5 Certificates, seventh, to the Class M-4
Certificates, eighth, to the Class M-3 Certificates, ninth, to the Class M-2
Certificates, tenth, to the Class M-1 Certificates and eleventh, to the Class
A
Certificates, on a pro
rata
basis,
in each case based on, and to the extent of, one month’s interest at the then
applicable respective Pass-Through Rate on the respective Certificate Principal
Balance or Notional Amount, as applicable, of each such Certificate and (2)
the
aggregate amount of any Realized Losses allocated to the Mezzanine Certificates
and Net WAC Rate Carryover Amounts paid to the Class A Certificates and the
Mezzanine Certificates incurred for any Distribution Date shall be allocated
to
the Class CE Certificates on a pro
rata
basis
based on, and to the extent of, one month’s interest at the then applicable
respective Pass-Through Rate on the respective Certificate Principal Balance
or
Notional Amount thereof, as applicable.
For
purposes of calculating the amount of Uncertificated Interest for the REMIC
I
Group I Regular Interests for any Distribution Date, the aggregate amount of
any
Prepayment Interest Shortfalls (to the extent not covered by payments by the
Servicer pursuant to Section 3.23 of this Agreement or the Master Servicer
pursuant to Section 4.19) and any Relief Act Interest Shortfalls incurred in
respect of Group I Mortgage Loans shall be allocated first, to REMIC I Regular
Interest I and to the REMIC I Group I Regular Interests ending with the
designation “B”, pro
rata
based
on, and to the extent of, one month’s interest at the then applicable respective
REMIC I Remittance Rates on the respective Uncertificated Principal Balances
of
each such REMIC I Regular Interest, and then, to REMIC I Group I Regular
Interests ending with the designation “A”, pro rata based on, and to the extent
of, one month’s interest at the then applicable respective REMIC I Remittance
Rates on the respective Uncertificated Balances of each such REMIC I Regular
Interest.
88
For
purposes of calculating the amount of Uncertificated Interest for the REMIC
I
Group II Regular Interests for any Distribution Date, the aggregate amount
of
any Prepayment Interest Shortfalls (to the extent not covered by payments by
the
Servicer pursuant to Section 3.23 of this Agreement or the Master Servicer
pursuant to Section 4.19) and any Relief Act Interest Shortfalls incurred in
respect of Group II Mortgage Loans shall be allocated first, to REMIC I Regular
Interest II and to the REMIC I Group II Regular Interests ending with the
designation “B”, pro
rata
based
on, and to the extent of, one month’s interest at the then applicable respective
REMIC I Remittance Rates on the respective Uncertificated Principal Balances
of
each such REMIC I Regular Interest , and then, to REMIC I Group II Regular
Interests ending with the designation “A”, pro rata based on, and to the extent
of, one month’s interest at the then applicable respective REMIC I Remittance
Rates on the respective Uncertificated Balances of each such REMIC I Regular
Interest.
For
purposes of calculating the amount of Uncertificated Interest for the REMIC
II
Regular Interests for any Distribution Date:
(A)The
REMIC
II Marker Allocation Percentage of the aggregate amount of any Prepayment
Interest Shortfalls (to the extent not covered by payments by the Servicer
pursuant to Section 3.23 of this Agreement or the Master Servicer pursuant
to
Section 4.19) and the REMIC II Marker Allocation Percentage of any Relief Act
Interest Shortfalls incurred in respect of the Mortgage Loans for any
Distribution Date shall be allocated among REMIC II Regular Interest AA, REMIC
II Regular Interest A-1, REMIC II Regular Interest A-2A, REMIC II Regular
Interest A-2B, REMIC II Regular Interest A-2C, REMIC II Regular Interest A-2D,
REMIC II Regular Interest M-1, REMIC II Regular Interest M-2, REMIC II Regular
Interest M-3, REMIC II Regular Interest M-4, REMIC II Regular Interest M-5,
REMIC II Regular Interest M-6, REMIC II Regular Interest M-7, REMIC II Regular
Interest M-8, REMIC II Regular Interest M-9 and REMIC II Regular Interest ZZ
pro
rata
based
on, and to the extent of, one month’s interest at the then applicable respective
REMIC II Remittance Rate on the respective Uncertificated Balance of each such
REMIC II Regular Interest; and
(B)The
REMIC
II Sub WAC Allocation Percentage of the aggregate amount of any Prepayment
Interest Shortfalls (to the extent not covered by payments by the Servicer
pursuant to Section 3.23 of this Agreement or by the Master Servicer pursuant
to
Section 4.19 of this Agreement) and the REMIC II Sub WAC Allocation Percentage
of any Relief Act Interest Shortfalls incurred in respect of the Mortgage Loans
for any Distribution Date shall be allocated first, to Uncertificated Interest
payable to REMIC II Regular Interest I-SUB, REMIC II Regular Interest I-GRP,
REMIC II Regular Interest II-SUB, REMIC II Regular Interest II-GRP and REMIC
II
Regular Interest XX, pro
rata
based
on, and to the extent of, one month’s interest at the then applicable respective
REMIC II Remittance Rate on the respective Uncertificated Balance of each such
REMIC II Regular Interest.
89
ARTICLE
II
CONVEYANCE
OF MORTGAGE LOANS;
ORIGINAL
ISSUANCE OF CERTIFICATES
SECTION
2.01. Conveyance
of the Mortgage Loans.
The
Depositor, concurrently with the execution and delivery hereof, does hereby
transfer, assign, set over and otherwise convey to the Trustee, on behalf of
the
Trust, without recourse, for the benefit of the Certificateholders, all the
right, title and interest of the Depositor, including any security interest
therein for the benefit of the Depositor, in and to the Mortgage Loans
identified on the Mortgage Loan Schedule, the rights of the Depositor under
the
Mortgage Loan Purchase Agreement (including, without limitation the right to
enforce the obligations of the other parties thereto thereunder), the rights
of
the Depositor under the Cap Contracts, the right to any payments made by the
Cap
Counterparty under the Cap Contracts, the right to any Net Swap Payment and
any
Swap Termination Payment made by the Swap Provider, and all other assets
included or to be included in REMIC I. Such assignment includes all interest
and
principal received by the Depositor and the Servicer on or with respect to
the
Mortgage Loans (other than payments of principal and interest due on such
Mortgage Loans on or before the Cut-off Date). A copy of the Mortgage Loan
Purchase Agreement is attached hereto as Exhibit F.
In
connection with such transfer and assignment, the Depositor does hereby deliver
to, and deposit with the Custodian pursuant to the Custodial Agreement the
documents with respect to each Mortgage Loan as described under Section 2 of
the
Custodial Agreements (the “Mortgage Loan Documents”). In connection with such
delivery and as further described in the Custodial Agreement, the Custodian
will
be required to review such Mortgage Loan Documents and deliver to the Trustee,
the Depositor, the Servicer and the Sponsor certifications (in the forms
attached to the Custodial Agreement) with respect to such review with exceptions
noted thereon. In addition, under the Custodial Agreement the Depositor will
be
required to cure certain defects with respect to the Mortgage Loan Documents
for
the related Mortgage Loans after the delivery thereof by the Depositor to the
Custodian as more particularly set forth therein.
Notwithstanding
anything to the contrary contained herein, the parties hereto acknowledge that
the functions of the Trustee with respect to the custody, acceptance, inspection
and release of the Mortgage Files, including, but not limited to certain
insurance policies and documents contemplated by Section 4.11, and preparation
and delivery of the certifications shall be performed by the Custodian pursuant
to the terms and conditions of the Custodial Agreement.
The
Depositor shall deliver or cause the related originator to deliver to the
Servicer copies of all trailing documents required to be included in the
Mortgage File at the same time the originals or certified copies thereof are
delivered to the Trustee or Custodian, such documents including the mortgagee
policy of title insurance and any Mortgage Loan Documents upon return from
the
recording office. The Servicer shall not be responsible for any custodian fees
or other costs incurred in obtaining such documents and the Depositor shall
cause the Servicer to be reimbursed for any such costs the Servicer may incur
in
connection with performing its obligations under this Agreement.
90
The
Mortgage Loans permitted by the terms of this Agreement to be included in the
Trust are limited to (i) Mortgage Loans (which the Depositor acquired pursuant
to the Mortgage Loan Purchase Agreement, which contains, among other
representations and warranties, a representation and warranty of the Sponsor
that no Mortgage Loan is a “High-Cost Home Loan” as defined in the New Jersey
Home Ownership Act effective November 27, 2003 or as defined in the New Mexico
Home Loan Protection Act effective January 1, 2004, as defined in the
Massachusetts Predatory Home Loan Practices Act, effective November 7, 2004
(Mass. Xxx. Laws Ch. 183C) or as defined in the Indiana Home Loan Practices
Act,
effective January 1, 2005 (Ind. Code Xxx. Sections 24-9-1 through 24-9-9) or
a
“high risk home loan” under the Illinois High Risk Home Loan Act, effective as
of January 1, 2004) and (ii) Qualified Substitute Mortgage Loans (which, by
definition as set forth herein and referred to in the Mortgage Loan Purchase
Agreement, are required to conform to, among other representations and
warranties, the representation and warranty of the Sponsor that no Qualified
Substitute Mortgage Loan is a “High-Cost Home Loan” as defined in the New Jersey
Home Ownership Act effective November 27, 2003 or as defined in the New Mexico
Home Loan Protection Act effective January 1, 2004, as defined in the
Massachusetts Predatory Home Loan Practices Act, effective November 7, 2004
(Mass. Xxx. Laws Ch. 183C) or as defined in the Indiana Home Loan Practices
Act,
effective January 1, 2005 (Ind. Code Xxx. Sections 24-9-1 through 24-9-9) or
a
“high risk home loan” under the Illinois High Risk Home Loan Act, effective as
of January 1, 2004). The Depositor and the Trustee on behalf of the Trust
understand and agree that it is not intended that any Mortgage Loan be included
in the Trust that is a “High-Cost Home Loan” as defined in the New Jersey Home
Ownership Act effective November 27, 2003, as defined in the New Mexico Home
Loan Protection Act effective January 1, 2004, as defined in the Massachusetts
Predatory Home Loan Practices Act, effective November 7, 2004 (Mass. Xxx. Laws
Ch. 183C) or as defined in the Indiana Home Loan Practices Act, effective
January 1, 2005 (Ind. Code Xxx. Sections 24-9-1 through 24-9-9) or a “high risk
home loan” under the Illinois High Risk Home Loan Act, effective as of January
1, 2004.
SECTION
2.02. Acceptance
of REMIC I by Trustee.
The
Trustee acknowledges receipt, subject to the provisions of Section 2.01 hereof
and Section 2 of the Custodial Agreement, of the Mortgage Loan Documents and
all
other assets included in the definition of “REMIC I” under clauses (i), (iii),
(iv) and (v) (to the extent of amounts deposited into the Distribution Account)
and declares that it holds (or the Custodian on its behalf holds) and will
hold
such documents and the other documents delivered to it constituting a Mortgage
Loan Document, and that it holds (or the Custodian on its behalf holds) or
will
hold all such assets and such other assets included in the definition of “REMIC
I” in trust for the exclusive use and benefit of all present and future
Certificateholders.
SECTION
2.03. Repurchase
or Substitution of Mortgage Loans.
(a) Upon
discovery or receipt of notice of any materially defective document in, or
that
a document is missing from, a Mortgage File or of a breach by the Sponsor of
any
representation, warranty or covenant under the Mortgage Loan Purchase Agreement
in respect of any Mortgage Loan that materially and adversely affects the value
of such Mortgage Loan or the interest therein of the Certificateholders, the
Trustee shall promptly notify the Sponsor and the Servicer of such defect,
missing document or breach and request that the Sponsor deliver such missing
document, cure such defect or breach within sixty (60) days from the date the
Sponsor was notified of such missing document, defect or breach, and if the
Sponsor does not deliver such missing document or cure such defect or breach
in
all material respects during such period, the Trustee shall enforce the
obligations of the Sponsor under the Mortgage Loan Purchase Agreement to
repurchase such Mortgage Loan from REMIC I at the Purchase Price within ninety
(90) days after the date on which the Sponsor was notified of such missing
document, defect or breach, if and to the extent that the Sponsor is obligated
to do so under the Mortgage Loan Purchase Agreement. The Purchase Price for
the
repurchased Mortgage Loan shall be remitted to the Servicer for deposit in
the
Collection Account and the Trustee, upon receipt of written certification from
the Servicer of such deposit, shall release or cause the Custodian (upon receipt
of a request for release in the form attached to the Custodial Agreement) to
release to the Sponsor the related Mortgage File and the Trustee shall execute
and deliver such instruments of transfer or assignment, in each case without
recourse, representation or warranty, as the Sponsor shall furnish to it and
as
shall be necessary to vest in the Sponsor any Mortgage Loan released pursuant
hereto, and the Trustee shall not have any further responsibility with regard
to
such Mortgage File. In lieu of repurchasing any such Mortgage Loan as provided
above, if so provided in the Mortgage Loan Purchase Agreement, the Sponsor
may
cause such Mortgage Loan to be removed from REMIC I (in which case it shall
become a Deleted Mortgage Loan) and substitute one or more Qualified Substitute
Mortgage Loans in the manner and subject to the limitations set forth in Section
2.03(b). It is understood and agreed that the obligation of the Sponsor 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
respecting such omission, defect or breach available to the Trustee and the
Certificateholders. Notwithstanding anything to the contrary contained herein,
any breach of a representation or warranty contained in clauses (viii),
(xxxviii), (xxxix), (xl), (xli), (xlvi), (xlvii), (lvi), (lxi), (lxiv), (lxvii),
(lxix) and/or (lxx) of Section 6 of the Mortgage Loan Purchase Agreement
shall be automatically deemed to affect materially and adversely the interests
of the Certificateholders.
91
In
addition, promptly upon the earlier of discovery by the Servicer or receipt
of
notice by the Servicer of the breach of the representation or covenant of the
Sponsor set forth in Section 5(xii) of the Mortgage Loan Purchase Agreement
which materially and adversely affects the interests of the Holders of the
Class
P Certificates in any Prepayment Charge, the Servicer shall promptly notify
the
Sponsor and the Trustee of such breach. The Trustee shall enforce the
obligations of the Sponsor under the Mortgage Loan Purchase Agreement to remedy
such breach to the extent and in the manner set forth in the Mortgage Loan
Purchase Agreement.
(b) Any
substitution of Qualified Substitute Mortgage Loans for Deleted Mortgage Loans
made pursuant to Section 2.03(a) must be effected prior to the date which is
two
years after the Startup Day for REMIC I.
As
to any
Deleted Mortgage Loan for which the Sponsor substitutes a Qualified Substitute
Mortgage Loan or Loans, such substitution shall be effected by the Sponsor
delivering to the Trustee or the Custodian on behalf of the Trustee, for such
Qualified Substitute Mortgage Loan or Loans, the Mortgage Note, the Mortgage,
the Assignment to the Trustee, and such other documents and agreements, with
all
necessary endorsements thereon, as are required by Section 2 of the Custodial
Agreement, as applicable, together with an Officers’ Certificate providing that
each such Qualified Substitute Mortgage Loan satisfies the definition thereof
and specifying the Substitution Shortfall Amount (as described below), if any,
in connection with such substitution. The Custodian on behalf of the Trustee
shall acknowledge receipt of such Qualified Substitute Mortgage Loan or Loans
and, within ten (10) Business Days thereafter, review such documents and deliver
to the Depositor, the Trustee and the Servicer, with respect to such Qualified
Substitute Mortgage Loan or Loans, an initial certification pursuant to the
Custodial Agreement, with any applicable exceptions noted thereon. Within one
year of the date of substitution, the Custodian on behalf of the Trustee shall
deliver to the Depositor, the Trustee and the Servicer a final certification
pursuant to the Custodial Agreement with respect to such Qualified Substitute
Mortgage Loan or Loans, with any applicable exceptions noted thereon. Monthly
Payments due with respect to Qualified Substitute Mortgage Loans in the month
of
substitution are not part of REMIC I and will be retained by the Sponsor. For
the month of substitution, distributions to Certificateholders will reflect
the
Monthly Payment due on such Deleted Mortgage Loan on or before the Due Date
in
the month of substitution, and the Sponsor shall thereafter be entitled to
retain all amounts subsequently received in respect of such Deleted Mortgage
Loan. The Depositor shall give or cause to be given written notice to the
Certificateholders that such substitution has taken place, shall amend the
Mortgage Loan Schedule to reflect the removal of such Deleted Mortgage Loan
from
the terms of this Agreement and the substitution of the Qualified Substitute
Mortgage Loan or Loans and shall deliver a copy of such amended Mortgage Loan
Schedule to the Trustee and the Servicer. Upon such substitution, such Qualified
Substitute Mortgage Loan or Loans shall constitute part of the Trust Fund and
shall be subject in all respects to the terms of this Agreement and the Mortgage
Loan Purchase Agreement, including all applicable representations and warranties
thereof included herein or in the Mortgage Loan Purchase Agreement.
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For
any
month in which the Sponsor substitutes one or more Qualified Substitute Mortgage
Loans for one or more Deleted Mortgage Loans, the Servicer will determine the
amount (the “Substitution Shortfall Amount”), if any, by which the aggregate
Purchase Price of all such Deleted Mortgage Loans exceeds the aggregate of,
as
to each such Qualified Substitute Mortgage Loan, the Scheduled Principal Balance
thereof as of the date of substitution, together with one month’s interest on
such Scheduled Principal Balance at the applicable Net Mortgage Rate, plus
all
outstanding P&I Advances and Servicing Advances (including Nonrecoverable
P&I Advances and Nonrecoverable Servicing Advances) related thereto. On the
date of such substitution, the Sponsor will deliver or cause to be delivered
to
the Servicer for deposit in the Collection Account an amount equal to the
Substitution Shortfall Amount, if any, and the Trustee or the Custodian on
behalf of the Trustee, upon receipt of the related Qualified Substitute Mortgage
Loan or Loans, upon receipt of a request for release in the form attached to
the
Custodial Agreement and certification by the Servicer of such deposit, shall
release to the Sponsor the related Mortgage File or Files and the Trustee shall
execute and deliver such instruments of transfer or assignment, in each case
without recourse, representation or warranty, as the Sponsor shall deliver
to it
and as shall be necessary to vest therein any Deleted Mortgage Loan released
pursuant hereto.
In
addition, the Sponsor shall obtain at its own expense and deliver to the Trustee
an Opinion of Counsel to the effect that such substitution will not cause (a)
any federal tax to be imposed on any Trust REMIC, including without limitation,
any federal tax imposed on “prohibited transactions” under Section 860F(a)(1) of
the Code or on “contributions after the startup date” under Section 860G(d)(1)
of the Code, or (b) any Trust REMIC to fail to qualify as a REMIC at any time
that any Certificate is outstanding.
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(c) Upon
discovery by the Depositor, the Sponsor, the Servicer or the Trustee that any
Mortgage Loan does not constitute a “qualified mortgage” within the meaning of
Section 860G(a)(3) of the Code, the party discovering such fact shall within
two
(2) Business Days give written notice thereof to the other parties. In
connection therewith, the Sponsor shall repurchase or substitute one or more
Qualified Substitute Mortgage Loans for the affected Mortgage Loan within ninety
(90) days of the earlier of discovery or receipt of such notice with respect
to
such affected Mortgage Loan. Such repurchase or substitution shall be made
by
(i) the Sponsor if the affected Mortgage Loan’s status as a non-qualified
mortgage is or results from a breach of any representation, warranty or covenant
made by the Sponsor under the Mortgage Loan Purchase Agreement or (ii) the
Depositor, if the affected Mortgage Loan’s status as a non-qualified mortgage
does not result from a breach of a representation or warranty. Any such
repurchase or substitution shall be made in the same manner as set forth in
Section 2.03(a). The Trustee shall reconvey to the Sponsor the Mortgage Loan
to
be released pursuant hereto in the same manner, and on the same terms and
conditions, as it would a Mortgage Loan repurchased for breach of a
representation or warranty.
(d) With
respect to a breach of the representations made pursuant to Section 5(xii)
of
the Mortgage Loan Purchase Agreement that materially and adversely affects
the
value of such Mortgage Loan or the interest therein of the Certificateholders,
the Sponsor shall be required to take the actions set forth in this Section
2.03.
(e) Within
ninety (90) days of the earlier of discovery by the Servicer or receipt of
notice by the Servicer of the breach of any representation, warranty or covenant
of the Servicer set forth in Section 2.05 which materially and adversely affects
the interests of the Certificateholders in any Mortgage Loan or Prepayment
Charge, the Servicer shall cure such breach in all material
respects.
SECTION
2.04. Representations
and Warranties of the Master Servicer.
The
Master Servicer hereby represents, warrants and covenants to the Servicer,
the
Depositor and the Trustee, for the benefit of each of the Trustee and the
Certificateholders, that as of the Closing Date or as of such date specifically
provided herein:
(i) The
Master Servicer is a national banking association duly formed, validly existing
and in good standing under the laws of the United States of America and is
duly
authorized and qualified to transact any and all business contemplated by this
Agreement to be conducted by the Master Servicer;
(ii) The
Master Servicer has the full power and authority to conduct its business as
presently conducted by it and to execute, deliver and perform, and to enter
into
and consummate, all transactions contemplated by this Agreement. The Master
Servicer has duly authorized the execution, delivery and performance of this
Agreement, has duly executed and delivered this Agreement, and this Agreement,
assuming due authorization, execution and delivery by the other parties hereto,
constitutes a legal, valid and binding obligation of the Master Servicer,
enforceable against it in accordance with its terms except as the enforceability
thereof may be limited by bankruptcy, insolvency, reorganization or similar
laws
affecting the enforcement of creditors’ rights generally and by general
principles of equity;
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(iii) The
execution and delivery of this Agreement by the Master Servicer, the
consummation by the Master Servicer of any other of the transactions herein
contemplated, and the fulfillment of or compliance with the terms hereof are
in
the ordinary course of business of the Master Servicer and will not (A) result
in a breach of any term or provision of the charter and by-laws of the Master
Servicer or (B) conflict with, result in a breach, violation or acceleration
of,
or result in a default under, the terms of any other material agreement or
instrument to which the Master Servicer is a party or by which it may be bound,
or any statute, order or regulation applicable to the Master Servicer of any
court, regulatory body, administrative agency or governmental body having
jurisdiction over the Master Servicer; and the Master Servicer is not a party
to, bound by, or in breach or violation of any indenture or other agreement
or
instrument, or subject to or in violation of any statute, order or regulation
of
any court, regulatory body, administrative agency or governmental body having
jurisdiction over it, which materially and adversely affects or, to the Master
Servicer’s knowledge, would in the future materially and adversely affect, (x)
the ability of the Master Servicer to perform its obligations under this
Agreement or (y) the business, operations, financial condition, properties
or
assets of the Master Servicer taken as a whole;
(iv) The
Master Servicer does not believe, nor does it have any reason or cause to
believe, that it cannot perform each and every covenant made by it and contained
in this Agreement;
(v) No
litigation is pending against the Master Servicer that would materially and
adversely affect the execution, delivery or enforceability of this Agreement
or
the ability of the Master Servicer to perform any of its other obligations
hereunder in accordance with the terms hereof;
(vi) There
are
no actions or proceedings against, or investigations known to it of, the Master
Servicer before any court, administrative or other tribunal (A) that might
prohibit its entering into this Agreement, (B) seeking to prevent the
consummation of the transactions contemplated by this Agreement or (C) that
might prohibit or materially and adversely affect the performance by the Master
Servicer of its obligations under, or validity or enforceability of, this
Agreement;
(vii) No
consent, approval, authorization or order of any court or governmental agency
or
body is required for the execution, delivery and performance by the Master
Servicer of, or compliance by the Master Servicer with, this Agreement or the
consummation by it of the transactions contemplated by this Agreement, except
for such consents, approvals, authorizations or orders, if any, that have been
obtained prior to the Closing Date; and
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(viii) There
are
no affiliations, relationships or transactions relating to the Master Servicer
of a type that are described under Item 1119 of Regulation AB with the
Depositor, the Sponsor, the Servicer, the Credit Risk Manager, the Cap
Counterparty, the Swap Provider or the Trustee.
It
is
understood and agreed that the representations, warranties and covenants set
forth in this Section 2.04 shall survive the resignation or termination of
the
parties hereto and the termination of this Agreement and shall inure to the
benefit of the Trustee, the Depositor and the Certificateholders.
SECTION
2.05. Representations,
Warranties and Covenants of the Servicer.
(a) The
Servicer hereby represents, warrants and covenants to the Master Servicer,
the
Securities Administrator, the Depositor and the Trustee, for the benefit of
each
of such Persons and the Certificateholders that as of the Closing Date or as
of
such date specifically provided herein:
(i) The
Servicer is a limited liability company duly organized and validly existing
under the laws of the jurisdiction of its formation, and is duly authorized
and
qualified to transact any and all business contemplated by this Agreement to
be
conducted by the Servicer in any state in which a Mortgaged Property is located
or is otherwise not required under applicable law to effect such qualification
and, in any event, is in compliance with the doing business laws of any such
State, to the extent necessary to ensure its ability to enforce each Mortgage
Loan and to service the Mortgage Loans in accordance with the terms of this
Agreement;
(ii) The
Servicer has the full power and authority to conduct its business as presently
conducted by it and to execute, deliver and perform, and to enter into and
consummate, all transactions contemplated by this Agreement. The Servicer has
duly authorized the execution, delivery and performance of this Agreement,
has
duly executed and delivered this Agreement, and this Agreement, assuming due
authorization, execution and delivery by the other parties hereto, constitutes
a
legal, valid and binding obligation of the Servicer, enforceable against it
in
accordance with its terms, except as the enforceability thereof may be limited
by bankruptcy, insolvency, reorganization or similar laws affecting the
enforcement of creditors’ rights generally and by general principles of
equity;
(iii) The
execution and delivery of this Agreement by the Servicer, the servicing of
the
Mortgage Loans by the Servicer hereunder, the consummation by the Servicer
of
any other of the transactions herein contemplated, and the fulfillment of or
compliance with the terms hereof are in the ordinary course of business of
the
Servicer and will not (A) result in a breach of any term or provision of the
Servicer’s formation documents or (B) conflict with, result in a breach,
violation or acceleration of, or result in a default under, the terms of any
other material agreement or instrument to which the Servicer is a party or
by
which it may be bound, or any statute, order or regulation applicable to the
Servicer of any court, regulatory body, administrative agency or governmental
body having jurisdiction over the Servicer; and the Servicer is not a party
to,
bound by, or in breach or violation of any indenture or other agreement or
instrument, or subject to or in violation of any statute, order or regulation
of
any court, regulatory body, administrative agency or governmental body having
jurisdiction over it, which materially and adversely affects or, to the
Servicer's knowledge, would in the future materially and adversely affect,
(x)
the ability of the Servicer to perform its obligations under this Agreement,
(y)
the business, operations, financial condition, properties or assets of the
Servicer taken as a whole or (z) the legality, validity or enforceability of
this Agreement;
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(iv) The
Servicer does not believe, nor does it have any reason or cause to believe,
that
it cannot perform each and every covenant made by it and contained in this
Agreement;
(v) No
litigation is pending against the Servicer that would materially and adversely
affect the execution, delivery or enforceability of this Agreement or the
ability of the Servicer to service the Mortgage Loans or to perform any of
its
other obligations hereunder in accordance with the terms hereof;
(vi) There
are
no actions or proceedings against, or investigations known to it of, the
Servicer before any court, administrative or other tribunal (A) that might
prohibit its entering into this Agreement, (B) seeking to prevent the
consummation of the transactions contemplated by this Agreement or (C) that
might prohibit or materially and adversely affect the performance by the
Servicer of its obligations under, or the validity or enforceability of, this
Agreement;
(vii) No
consent, approval, authorization or order of any court or governmental agency
or
body is required for the execution, delivery and performance by the Servicer
of,
or compliance by the Servicer with, this Agreement or the consummation by it
of
the transactions contemplated by this Agreement, except for such consents,
approvals, authorizations or orders, if any, that have been obtained prior
to
the Closing Date;
(viii) The
Servicer has fully furnished and will continue to fully furnish, in accordance
with the Fair Credit Reporting Act and its implementing regulations, accurate
and complete information (e.g., favorable and unfavorable) on its borrower
credit files to Equifax, Experian and Trans Union Credit Information Company
or
their successors on a monthly basis;
(ix) The
Servicer is a member of MERS in good standing, and will 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; and
(x) The
Servicer will not waive any Prepayment Charge other than in accordance with
the
standard set forth in Section 3.01.
(b) Notwithstanding
anything to the contrary contained in this Agreement, if the covenant of the
Servicer set forth in Section 2.05(a)(x) above is breached, the Servicer will
pay the amount of such waived Prepayment Charge, from its own funds without
any
right of reimbursement, for the benefit of the Holders of the Class P
Certificates, by depositing such amount into the Collection Account within
90
days of the earlier of discovery by the Servicer or receipt of notice by the
Servicer of such breach; provided, however, the Servicer shall not have any
obligation to pay the amount of any uncollected Prepayment Charge under this
Section 2.05 if the Servicer did not have a copy of the related Mortgage Note,
the Servicer requested a copy of the same from the Custodian in accordance
with
the terms of the Custodial Agreement and the Custodian failed to provide such
copy within the time frame set forth in the Custodial Agreement. Furthermore,
notwithstanding any other provisions of this Agreement, any payments made by
the
Servicer in respect of any waived Prepayment Charges pursuant to this paragraph
shall be deemed to be paid outside of the Trust Fund.
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(c) It
is
understood and agreed that the representations, warranties and covenants set
forth in this Section 2.05 shall survive the resignation or termination of
the
parties hereto, the termination of this Agreement and the delivery of the
Mortgage Files to the Custodian and shall inure to the benefit of the Trustee,
the Master Servicer, the Securities Administrator, the Depositor, the
Certificateholders. Upon discovery by any such Person or the Servicer of a
breach of any of the foregoing representations, warranties and covenants which
materially and adversely affects the value of any Mortgage Loan, Prepayment
Charge or the interests therein of the Certificateholders, the party discovering
such breach shall give prompt written notice (but in no event later than two
(2)
Business Days following such discovery) to the Trustee. Subject to Section
8.01,
unless such breach shall not be susceptible of cure within ninety (90) days,
the
obligation of the Servicer set forth in Section 2.03(e) to cure breaches shall
constitute the sole remedy against the Servicer available to the
Certificateholders, the Depositor or the Trustee on behalf of the
Certificateholders respecting a breach of the representations, warranties and
covenants contained in this Section 2.05.
SECTION
2.06. Issuance
of the REMIC I Regular Interests and the Class R-I Interest.
The
Trustee acknowledges the assignment to it of the Mortgage Loans and the delivery
to the Custodian on its behalf of the Mortgage Loan Documents, subject to the
provisions of Section 2.01 and Section 2.02 hereof and Section 2 of the
Custodial Agreement, together with the assignment to it of all other assets
included in REMIC I, the receipt of which is hereby acknowledged. The interests
evidenced by the Class R-I Interest, together with the REMIC I Regular
Interests, constitute the entire beneficial ownership interest in REMIC I.
The
rights of the Holders of the Class R-I Interest and REMIC I (as holder of the
REMIC I Regular Interests) to receive distributions from the proceeds of REMIC
I
in respect of the Class R-I Interest and the REMIC I Regular Interests,
respectively, and all ownership interests evidenced or constituted by the Class
R-I Interest and the REMIC I Regular Interests, shall be as set forth in this
Agreement.
SECTION
2.07. Conveyance
of the REMIC I Regular Interests; Acceptance of REMIC II and REMIC III by the
Trustee.
The
Depositor, concurrently with the execution and delivery hereof, does hereby
transfer, assign, set over and otherwise convey to the Trustee, without recourse
all the right, title and interest of the Depositor in and to the REMIC I Regular
Interests for the benefit of the Class R-II Interest and REMIC II (as holder
of
the REMIC I Regular Interests). The Trustee acknowledges receipt of the REMIC
I
Regular Interests and declares that it holds and will hold the same in trust
for
the exclusive use and benefit of all present and future Holders of the Class
R-II Interest and REMIC II (as holder of the REMIC I Regular Interests). The
rights of the Holder of the Class R-II Interest and REMIC II (as holder of
the
REMIC I Regular Interests) to receive distributions from the proceeds of REMIC
II in respect of the Class R-II Interest and the REMIC II Regular Interests,
respectively, and all ownership interests evidenced or constituted by the Class
R-II Interest and the REMIC II Regular Interests, shall be as set forth in
this
Agreement. The Class R-II Interest and the REMIC II Regular Interests shall
constitute the entire beneficial ownership interest in REMIC II. The Trustee
acknowledges receipt of the REMIC II Regular Interests and declares that it
holds and will hold the same in trust for the exclusive use and benefit of
all
present and future Holders of the Class R-III Interest and REMIC III (as holder
of the REMIC II Regular Interests). The rights of the Holder of the Class R-III
Interest and REMIC III (as holder of the REMIC II Regular Interests) to receive
distributions from the proceeds of REMIC III in respect of the Class R-III
Interest, the Class IO Interest and the Regular Certificates, respectively,
and
all ownership interests evidenced or constituted by the Class R-III Interest,
the Class IO Interest and the Regular Certificates, shall be as set forth in
this Agreement. The Class R-III Interest, Class IO Interest and the Regular
Certificates shall constitute the entire beneficial ownership interest in REMIC
III.
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SECTION
2.08. Issuance
of the Residual Certificates.
The
Trustee acknowledges the assignment to it of the REMIC I Regular Interests
and,
concurrently therewith and in exchange therefor, pursuant to the written request
of the Depositor executed by an officer of the Depositor, the Securities
Administrator has executed and authenticated and the Trustee has delivered
to or
upon the order of the Depositor, the Class R Certificates in authorized
denominations. The Class R Certificates evidence ownership in the Class R-I
Interest, the Class R-II Interest and the Class R-III Interest.
SECTION
2.09. Establishment
of the Trust.
The
Depositor does hereby establish, pursuant to the further provisions of this
Agreement and the laws of the State of New York, an express trust to be known,
for convenience, as “ACE Securities Corp., Home Equity Loan Trust, Series
2007-WM2” and does hereby appoint HSBC Bank USA, National Association as Trustee
in accordance with the provisions of this Agreement.
SECTION
2.10. Purpose
and Powers of the Trust.
The
purpose of the common law trust, as created hereunder, is to engage in the
following activities:
(a) acquire
and hold the Mortgage Loans and the other assets of the Trust Fund and the
proceeds therefrom;
(b) to
issue
the Certificates sold to the Depositor in exchange for the Mortgage
Loans;
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(c) to
make
payments on the Certificates;
(d) to
engage
in those activities that are necessary, suitable or convenient to accomplish
the
foregoing or are incidental thereto or connected therewith; and
(e) subject
to compliance with this Agreement, to engage in such other activities as may
be
required in connection with conservation of the Trust Fund and the making of
distributions to the Certificateholders.
The
trust
is hereby authorized to engage in the foregoing activities. The Trustee shall
not cause the trust to engage in any activity other than in connection with
the
foregoing or other than as required or authorized by the terms of this Agreement
(or those ancillary thereto) while any Certificate is outstanding, and this
Section 2.10 may not be amended, without the consent of the Certificateholders
evidencing 51% or more of the aggregate voting rights of the
Certificates.
SECTION
2.11. Representations
and Warranties of the Trustee.
The
Trustee hereby represents and warrants to the Sponsor and the Depositor, for
the
benefit of each of the Certificateholders, that as of the Closing
Date:
(a) There
are
no affiliations relating to the Trustee of a type that are described under
Item
1119(a) of Regulation AB; and
(b) There
are
no legal proceedings pending or contemplated, including legal proceedings
pending or contemplated by governmental authorities, against the Trustee that
could be material to the Certificateholders.
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ARTICLE
III
ADMINISTRATION
AND SERVICING
OF
THE
MORTGAGE LOANS; ACCOUNTS
SECTION
3.01. The
Servicer to Act as Servicer.
On
and
after the Closing Date, the Servicer shall service and administer the Mortgage
Loans on behalf of the Trust Fund and in the best interests of and for the
benefit of the Certificateholders (as determined by the Servicer in its
reasonable judgment) in accordance with the terms of this Agreement and the
respective Mortgage Loans and all applicable laws and regulations and, to the
extent consistent with such terms, in the same manner in which it services
and
administers similar mortgage loans for its own portfolio, giving due
consideration to customary and usual standards of practice of prudent mortgage
lenders and loan servicers administering similar mortgage loans but without
regard to:
(i) any
relationship that the Servicer or any Affiliate of the Servicer may have with
the related Mortgagor;
(ii) the
ownership of any Certificate by the Servicer or any Affiliate of the
Servicer;
(iii) the
Servicer’s obligation to make P&I Advances or Servicing Advances;
or
(iv) the
Servicer’s right to receive compensation for its services
hereunder.
To
the
extent consistent with the foregoing, the Servicer shall also seek to maximize
the timely and complete recovery of principal and interest on the Mortgage
Notes
and shall waive (or permit a Sub-Servicer to waive) a Prepayment Charge only
under the following circumstances: (i) such waiver is standard and customary
in
servicing similar Mortgage Loans and such waiver is related to a default or
reasonably foreseeable default and would, in the reasonable judgment of the
Servicer, maximize recovery of total proceeds taking into account the value
of
such Prepayment Charge and the related Mortgage Loan and, if such waiver is
made
in connection with a refinancing of the related Mortgage Loan, such refinancing
is related to a default or a reasonably foreseeable default, (ii) such
Prepayment Charge is unenforceable in accordance with applicable law or the
collection of such related Prepayment Charge would otherwise violate applicable
law or (iii) the collection of such Prepayment Charge would be considered
“predatory” pursuant to written guidance published or issued by any applicable
federal, state or local regulatory authority acting in its official capacity
and
having jurisdiction over such matters. In addition, the Servicer shall not
impose a Prepayment Charge in any instance when the Mortgage Loan is accelerated
or where the Mortgagor has made a Principal Prepayment in full in connection
with the workout of a delinquent Mortgage Loan or due to a default by the
Mortgagor. Notwithstanding any provision in this Agreement to the contrary,
in
the event the Prepayment Charge payable under the terms of the Mortgage Note
is
less than the amount of the Prepayment Charge set forth in the Prepayment Charge
Schedule or other information provided to the Servicer, neither the Servicer
nor
the Master Servicer shall have any liability or obligation with respect to
such
difference (including any obligation to recalculate any Prepayment Charges),
and
in addition shall not have any liability or obligation to pay the amount of
any
uncollected Prepayment Charge if the failure to collect such amount is the
direct result of inaccurate or incomplete information on the Prepayment Charge
Schedule.
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In
the
event the Servicer waives a Prepayment Charge in connection with clauses (ii)
or
(iii) of the preceding paragraph, the Servicer shall provide a written
explanation of the Servicer’s determination to the Master Servicer, and the
Master Servicer shall provide a copy of such writing to the Sponsor and the
Depositor.
Subject
only to the above-described servicing standards (the “Accepted Servicing
Practices”) and the terms of this Agreement and of the related Mortgage Loans,
the Servicer shall have full power and authority, to do or cause to be done
any
and all things in connection with such servicing and administration which it
may
deem necessary or desirable with the goal of maximizing proceeds of the Mortgage
Loan. Without limiting the generality of the foregoing, the Servicer in its
own
name is hereby authorized and empowered by the Trustee when the Servicer
believes it appropriate in its best judgment, to execute and deliver, on behalf
of the Trust Fund, the Certificateholders and the Trustee or any of them, and
upon written notice to the Trustee, any and all instruments of satisfaction
or
cancellation, or of partial or full release or discharge or subordination,
and
all other comparable instruments, with respect to the related Mortgage Loans
and
the related Mortgaged Properties and to institute foreclosure proceedings or
obtain a deed-in-lieu of foreclosure so as to convert the ownership of such
properties, and to hold or cause to be held title to such properties, on behalf
of the Trustee, for the benefit of the Trust Fund and the Certificateholders.
The Servicer shall service and administer the related Mortgage Loans in
accordance with applicable state and federal law and shall provide to the
Mortgagors any reports required to be provided to them thereby. The Servicer
shall also comply in the performance of this Agreement with all reasonable
rules
and requirements of each insurer under any standard hazard insurance policy.
Subject to Section 3.14, the Trustee shall execute, at the written request
of
the Servicer, and furnish to the Servicer a power of attorney in the form of
Exhibit D hereto and other documents necessary or appropriate to enable the
Servicer to carry out its servicing and administrative duties hereunder and
furnished to the Trustee by the Servicer, and the Trustee shall not be liable
for the actions of the Servicer under such powers of attorney and shall be
indemnified by the Servicer for any cost, liability or expense incurred by
the
Trustee in connection with the Servicer’s use or misuse of any such power of
attorney.
The
Servicer is hereby authorized and empowered in its own name or in the name
of a
Sub-Servicer engaged by the Servicer, when the Servicer or such Sub-Servicer,
as
the case may be, believes it is appropriate in its best judgment to register
any
Mortgage Loan on the MERS® System, or cause the removal from the registration of
any Mortgage Loan on the MERS® System, to execute and deliver, on behalf of the
Trustee and the Certificateholders or any of them, any and all instruments
of
assignment and other comparable instruments with respect to such assignment
or
re-recording of a Mortgage in the name of MERS, solely as nominee for the
Trustee and its successors and assigns. Any reasonable expenses incurred in
connection with the actions described in the preceding sentence or as a result
of MERS discontinuing or becoming unable to continue operations in connection
with the MERS® System, shall be reimbursable by the Trust Fund to the
Servicer.
102
In
accordance with Accepted Servicing Practices, the Servicer shall make or cause
to be made Servicing Advances as necessary for the purpose of effecting the
payment of taxes and assessments on the Mortgaged Properties, which Servicing
Advances shall be reimbursable in the first instance from related collections
from the related Mortgagors pursuant to Section 3.07, and further as
provided in Section 3.09; provided, however, the Servicer shall only make
such Servicing Advance if the related Mortgagor has not made such payment and
if
the failure to make such Servicing Advance would result in the loss of the
related Mortgaged Property due to a tax sale or foreclosure as result of a
tax
lien; provided, however, that the Servicer shall be required to make such
Servicing Advances only to the extent that such Servicing Advances, in the
good
faith judgment of the Servicer, will be recoverable by the Servicer out of
Insurance Proceeds, Liquidation Proceeds, or otherwise out of the proceeds
of
the related Mortgage Loan. Any cost incurred by the Servicer in effecting the
payment of taxes and assessments on a Mortgaged Property shall not, for the
purpose of calculating the Stated Principal Balance of such Mortgage Loan or
distributions to Certificateholders, be added to the unpaid principal balance
of
the related Mortgage Loan, notwithstanding that the terms of such Mortgage
Loan
so permit. The parties to this Agreement acknowledge that Servicing Advances
shall be reimbursable pursuant to Section 3.09 of this Agreement, and agree
that no Servicing Advance shall be rejected or disallowed by any party unless
it
has been shown that such Servicing Advance was not made in accordance with
the
terms of this Agreement.
Notwithstanding the foregoing, the parties understand and agree that, with
respect to any Mortgage Loan (1) the Master Servicer shall not approve the
reimbursement of any Servicing Advance made with respect to such Mortgage Loan
prior to the Cut-off Date (each, a “Pre-Cut-off Date Advance”) unless and until
it has received a Servicing Advance Schedule listing the amount of Pre-Cut-off
Date Advances made in respect of such Mortgage Loan from (a) the Servicer with
respect to any Mortgage Loans that were transferred to the Servicer prior to
the
Cut-off Date and/or (b) the Depositor with respect to any Mortgage Loans that
were transferred to the Servicer after the Cut-off Date, as applicable, (2)
the
aggregate Pre-Cut-off Date Advances reimbursable hereunder with respect to
such
Mortgage Loan shall not exceed the amount of Pre-Cut-off Date Advances for
such
Mortgage Loan shown on the Servicing Advance Schedule delivered to the Master
Servicer, (3) the Depositor shall be deemed to have agreed with and approved
the
Pre-Cut-off Date Advances shown on any Servicing Advance Schedule furnished
to
the Master Servicer, and (4) the Master Servicer will have no liability to
the
Depositor, the Servicer or any other Person, including any Certificateholder,
for approving reimbursement of related Pre-Cut-off Date Advances so long as
the
aggregate amount of such advances reimbursed hereunder does not exceed of the
amount of Pre-Cut-off Date Advances for such Mortgage Loan shown on the
Servicing Advance Schedule.
Notwithstanding
anything in this Agreement to the contrary, the Servicer may not make any future
advances with respect to a Mortgage Loan and the Servicer shall not permit
any
modification with respect to any related Mortgage Loan that would change the
Mortgage Rate, reduce or increase the principal balance (except for reductions
resulting from actual payments of principal) or change the final maturity date
on such related Mortgage Loan (unless, as provided in Section 3.06, the related
Mortgagor is in default with respect to the related Mortgage Loan or such
default is, in the judgment of the Servicer, reasonably foreseeable) or any
modification, waiver or amendment of any term of any related Mortgage Loan
that
would both (A) effect an exchange or reissuance of such Mortgage Loan under
Section 1001 of the Code (or final, temporary or proposed Treasury regulations
promulgated thereunder) and (B) cause any Trust REMIC created hereunder to
fail
to qualify as a REMIC under the Code or the imposition of any tax on “prohibited
transactions” or “contributions after the startup date” under the REMIC
Provisions.
103
In
the
event that the Mortgage Loan Documents relating to a Mortgage Loan contain
provisions requiring the related Mortgagor to arbitrate disputes (at the option
of the Trustee, on behalf of the Trust), the Trustee hereby authorizes the
Servicer to waive the Trustee’s right or option to arbitrate disputes and to
send written notice of such waiver to the Mortgagor, although the Mortgagor
may
still require arbitration at its option.
From
and
after the Closing Date, the Servicer will fully furnish, in accordance with
the
Fair Credit Reporting Act and its implementing regulations, accurate and
complete information (e.g., favorable and unfavorable) on its borrower credit
files to Equifax, Experian and Trans Union Credit Information Company or their
successors on a monthly basis.
SECTION
3.02. Sub-Servicing
Agreements Between the Servicer and Sub-Servicers.
(a) The
Servicer may arrange for the subservicing of any Mortgage Loan by a Sub-
Servicer pursuant to a Sub-Servicing Agreement; provided that such sub-servicing
arrangement and the terms of the related Sub-Servicing Agreement must provide
for the servicing of such Mortgage Loans in a manner consistent with the
servicing arrangements contemplated hereunder and the Servicer shall cause
any
Sub-Servicer engaged by it to comply with the provisions of this Agreement
as
required by Regulation AB (including, without limitation, to provide the
information required to be delivered under Sections 3.17, 3.18 and 3.20 hereof),
to the same extent as if such Sub-Servicer were the Servicer. The Servicer
shall
be responsible for obtaining from each Sub-Servicer engaged by it and delivering
to the Master Servicer any annual statement of compliance, assessment of
compliance, attestation report and Sarbanes Oxley related certification as
and
when required to be delivered. Each Sub-Servicer shall be (i) authorized to
transact business in the state or states where the related Mortgaged Properties
it is to service are situated, if and to the extent required by applicable
law
to enable the Sub-Servicer to perform its obligations hereunder and under the
Sub-Servicing Agreement and (ii) a Xxxxxxx Mac or Xxxxxx Mae approved mortgage
servicer. Notwithstanding the provisions of any Sub-Servicing Agreement, any
of
the provisions of this Agreement relating to agreements or arrangements between
the Servicer or a Sub-Servicer or reference to actions taken through the
Servicer or otherwise, the Servicer shall remain obligated and liable to the
Depositor, the Trustee and the Certificateholders for the servicing and
administration of the Mortgage Loans in accordance with the provisions of this
Agreement without diminution of such obligation or liability by virtue of such
Sub-Servicing Agreements or arrangements or by virtue of indemnification from
the Sub-Servicer and to the same extent and under the same terms and conditions
as if the Servicer alone were servicing and administering the Mortgage Loans.
Every Sub-Servicing Agreement entered into by the Servicer shall contain a
provision giving the successor servicer the option to terminate such agreement
in the event a successor servicer is appointed. All actions of each Sub-Servicer
performed pursuant to the related Sub-Servicing Agreement shall be performed
as
an agent of the Servicer with the same force and effect as if performed directly
by the Servicer.
104
(b) Notwithstanding
the foregoing, the Servicer shall be entitled to outsource one or more separate
servicing functions to a Subcontractor that does not meet the eligibility
requirements for a Sub-Servicer, so long as such outsourcing does not constitute
the delegation of the Servicer’s obligation to perform all or substantially all
of the servicing of the related Mortgage Loans to such Subcontractor. The
Servicer shall promptly, upon request, provide to the Master Servicer, the
Trustee and the Depositor a written description (in form and substance
reasonably satisfactory to the Master Servicer, the Trustee and the Depositor)
of the role and function of each Subcontractor utilized by the Servicer,
specifying (i) the identity of each such Subcontractor “participating in the
servicing function” within the meaning of Item 1122 of Regulation AB, and (ii)
which elements of the Servicing Criteria will be addressed in assessments of
compliance provided by each Subcontractor identified pursuant to clause (i)
of
this subsection; provided, however, that the Servicer shall not be required
to
provide the information in clauses (i) or (ii) of this subsection until such
time that the applicable assessment of compliance is due pursuant to Section
3.18 of this Agreement. The use by the Servicer of any such Subcontractor shall
not release the Servicer from any of its obligations hereunder and the Servicer
shall remain responsible hereunder for all acts and omissions of such
Subcontractor as fully as if such acts and omissions were those of the Servicer,
and the Servicer shall pay all fees and expenses of the Subcontractor from
the
Servicer’s own funds.
(c) As
a
condition to the utilization of any Subcontractor determined to be
“participating in the servicing function” within the meaning of Item 1122 of
Regulation AB, the Servicer shall cause any such Subcontractor used by the
Servicer for the benefit of the Master Servicer, the Trustee and the Depositor
to comply with the provisions of Sections 3.18 and 3.20 of this Agreement to
the
same extent as if such Subcontractor were the Servicer. The Servicer shall
be
responsible for obtaining from each such Subcontractor and delivering to the
Master Servicer and any Depositor any assessment of compliance, attestation
report and Xxxxxxxx-Xxxxx related certification required to be delivered by
such
Subcontractor under Sections 3.18 and 3.20, in each case as and when required
to
be delivered.
(d) For
purposes of this Agreement, the Servicer shall be deemed to have received any
collections, recoveries or payments with respect to the Mortgage Loans that
are
received by a Sub-Servicer regardless of whether such payments are remitted
by
the Sub-Servicer to the Servicer.
SECTION
3.03. Successor
Sub-Servicers.
Any
Sub-Servicing Agreement shall provide that the Servicer shall be entitled to
terminate any Sub-Servicing Agreement and to either itself directly service
the
related Mortgage Loans or enter into a Sub-Servicing Agreement with a successor
Sub-Servicer which qualifies under Section 3.02. Any Sub-Servicing Agreement
shall include the provision that such agreement may be immediately terminated
as
soon as is reasonably possible by any successor to the Servicer without fee
or,
in the event a termination fee exists, such fee shall be payable by the Servicer
form its own funds without reimbursement therefor, in accordance with the terms
of this Agreement, in the event that the Servicer (or any successor to the
Servicer) shall, for any reason, no longer be the Servicer of the related
Mortgage Loans (including termination due to a Servicer Event of Default).
The
Servicer shall be entitled to enter into an agreement with its Sub-Servicer
and
Subcontractor for indemnification of the Servicer or Subcontractor, as
applicable, by such Sub-Servicer and nothing contained in this Agreement shall
be deemed to limit or modify such indemnification.
105
SECTION
3.04. No
Contractual Relationship Between Sub-Servicer, Subcontractor, Trustee or the
Certificateholders.
Any
Sub-Servicing Agreement and any other transactions or services relating to
the
Mortgage Loans involving a Sub-Servicer or the Subcontractor, as applicable,
shall be deemed to be between the Sub-Servicer or Subcontractor, as applicable,
and the Servicer alone and the Master Servicer, Trustee and the
Certificateholders shall not be deemed parties thereto and shall have no claims,
rights, obligations, duties or liabilities with respect to any Sub-Servicer
or
the Subcontractor except as set forth in Section 3.05.
SECTION
3.05. Assumption
or Termination of Sub-Servicing Agreement by Successor Servicer.
In
connection with the assumption of the responsibilities, duties and liabilities
and of the authority, power and rights of the Servicer hereunder by a successor
servicer pursuant to Section 8.02, it is understood and agreed that the
Servicer’s rights and obligations under any Sub-Servicing Agreement then in
force between the Servicer and a Sub-Servicer shall be assumed simultaneously
by
such successor servicer without act or deed on the part of such successor
servicer; provided, however, that any successor servicer may terminate the
Sub-Servicer.
The
Servicer shall, upon the reasonable request of the Master Servicer, but at
its
own expense, deliver to the assuming party documents and records relating to
each Sub-Servicing Agreement and an accounting of amounts collected and held
by
it and otherwise use its best efforts to effect the orderly and efficient
transfer of the Sub-Servicing Agreements to the assuming party.
The
Servicing Fee payable to any such successor servicer shall be payable from
payments received on the Mortgage Loans in the amount and in the manner set
forth in this Agreement.
SECTION
3.06. Collection
of Certain Mortgage Loan Payments.
The
Servicer shall make reasonable efforts to collect all payments called for under
the terms and provisions of the related Mortgage Loans, and shall, to the extent
such procedures shall be consistent with this Agreement and Accepted Servicing
Practices, follow such collection procedures as it would follow with respect
to
mortgage loans comparable to the Mortgage Loans and held for its own account.
Consistent with the foregoing, the Servicer may in its discretion (i) waive
any
late payment charge or, if applicable, penalty interest or (ii) extend the
due
dates for the Monthly Payments due on a Mortgage Note related to a Mortgage
Loan
for a period of not greater than 180 days; provided that any extension pursuant
to this clause shall not affect the amortization schedule of any Mortgage Loan
for purposes of any computation hereunder. Notwithstanding the foregoing, in
the
event that any Mortgage Loan is in default or, in the judgment of the Servicer,
such default is reasonably foreseeable, the Servicer, consistent with Accepted
Servicing Practices may waive, modify or vary any term of such Mortgage Loan
(including, but not limited to, modifications that change the Mortgage Rate,
forgive the payment of principal or interest or extend the final maturity date
of such Mortgage Loan), accept payment from the related Mortgagor of an amount
less than the Stated Principal Balance in final satisfaction of such Mortgage
Loan, or consent to the postponement of strict compliance with any such term
or
otherwise grant indulgence to any Mortgagor if in the Servicer’s determination
such waiver, modification, postponement or indulgence is not materially adverse
to the interests of the Certificateholders (taking into account any estimated
Realized Loss that might result absent such action). The Servicer shall not
be
required to institute or join in litigation with respect to collection of any
payment (whether under a Mortgage, Mortgage Note or otherwise or against any
public or governmental authority with respect to a taking or condemnation)
if it
reasonably believes that enforcing the provision of the Mortgage or other
instrument pursuant to which such payment is required is prohibited by
applicable law.
106
SECTION
3.07. Collection
of Taxes, Assessments and Similar Items; Servicing Accounts.
To
the
extent the terms of a Mortgage provide for Escrow Payments, the Servicer shall
establish and maintain one or more accounts (the “Servicing Accounts”), into
which all collections from the Mortgagors (or related advances from
Sub-Servicers) for the payment of taxes, assessments, fire, flood, and hazard
insurance premiums, and comparable items for the account of the Mortgagors
(“Escrow Payments”) shall be deposited and retained. Servicing Accounts shall be
Eligible Accounts. The Servicer shall deposit in the clearing account in which
it customarily deposits payments and collections on mortgage loans in connection
with its mortgage loan servicing activities on a daily basis, and in no event
more than one Business Day after the Servicer’s receipt thereof, all Escrow
Payments collected on account of the Mortgage Loans and shall thereafter deposit
such Escrow Payments in the Servicing Accounts, in no event later than the
second Business Day after the deposit of good funds into the clearing account,
and retain therein, all Escrow Payments collected on account of the Mortgage
Loans, for the purpose of effecting the timely payment of any such items as
required under the terms of this Agreement. Withdrawals of amounts from a
Servicing Account may be made by the Servicer only to (i) effect timely payment
of taxes, assessments, fire, flood, and hazard insurance premiums, and
comparable items; (ii) reimburse itself out of related collections for any
Servicing Advances made pursuant to Section 3.01 (with respect to taxes and
assessments) and Section 3.11 (with respect to fire, flood and hazard
insurance); (iii) refund to Mortgagors any sums as may be determined to be
overages; (iv) for application to restore or repair the related Mortgaged
Property in accordance with Section 3.11; (v) pay interest, if required and
as
described below, to Mortgagors on balances in the Servicing Account; or, only
to
the extent not required to be paid to the related Mortgagors, to pay itself
interest on balances in the Servicing Account; or (vi) clear and terminate
the
Servicing Account at the termination of the Servicer’s obligations and
responsibilities in respect of the Mortgage Loans under this Agreement in
accordance with Article X. As part of its servicing duties, the Servicer shall
pay to the Mortgagors interest on funds in Servicing Accounts, to the extent
required by law and, to the extent that interest earned on funds in the
Servicing Accounts is insufficient, to pay such interest from its own funds,
without any reimbursement therefor. Notwithstanding the foregoing, the Servicer
shall not be obligated to collect Escrow Payments if the related Mortgage Loan
does not require such payments but the Servicer shall nevertheless be obligated
to make Servicing Advances as provided in Section 3.01 and Section 3.11. In
the
event the Servicer shall deposit in the Servicing Accounts any amount not
required to be deposited therein, it may at any time withdraw such amount from
the Servicing Accounts, any provision to the contrary
notwithstanding.
107
To
the
extent that a Mortgage does not provide for Escrow Payments, the Servicer (i)
shall determine whether any such payments are made by the Mortgagor in a manner
and at a time that is necessary to avoid the loss of the Mortgaged Property
due
to a tax sale or the foreclosure as a result of a tax lien and (ii) shall ensure
that all insurance required to be maintained on the Mortgaged Property pursuant
to this Agreement is maintained. If any such payment has not been made and
the
Servicer receives notice of a tax lien with respect to the Mortgage Loan being
imposed, the Servicer shall, promptly and to the extent required to avoid loss
of the Mortgaged Property, advance or cause to be advanced funds necessary
to
discharge such lien on the Mortgaged Property unless the Servicer determines
the
advance to be nonrecoverable. The Servicer assumes full responsibility for
the
payment of all such bills and shall effect payments of all such bills
irrespective of the Mortgagor’s faithful performance in the payment of same or
the making of the Escrow Payments and shall make Servicing Advances to effect
such payments subject to its determination of recoverability.
SECTION
3.08. Collection
Account and Distribution Account.
(a) On
behalf
of the Trust Fund, the Servicer shall establish and maintain one or more
“Collection Accounts”, held in trust for the benefit of the Trustee and the
Certificateholders. On behalf of the Trust Fund, the Servicer shall deposit
or
cause to be deposited in the clearing account in which it customarily deposits
payments and collections on mortgage loans in connection with its mortgage
loan
servicing activities on a daily basis, and in no event more than one Business
Day after the Servicer’s receipt thereof, and shall thereafter deposit in the
Collection Account, in no event later than two Business Days after the deposit
of good funds into the clearing account, as and when received or as otherwise
required hereunder, the following payments and collections received or made
by
it on or subsequent to the Cut-off Date other than amounts attributable to
a Due
Date on or prior to the Cut-off Date:
(i) all
payments on account of principal, including Principal Prepayments, on the
Mortgage Loans;
(ii) all
payments on account of interest (net of the related Servicing Fee and any
Prepayment Interest Excess) on each Mortgage Loan;
(iii) all
Insurance Proceeds and Liquidation Proceeds (other than proceeds collected
in
respect of any particular REO Property) and all Subsequent Recoveries with
respect to the Mortgage Loans;
(iv) any
amounts required to be deposited by the Servicer pursuant to Section 3.10 in
connection with any losses realized on Permitted Investments with respect to
funds held in the Collection Account;
(v) any
amounts required to be deposited by the Servicer pursuant to the second
paragraph of Section 3.11(a) in respect of any blanket policy
deductibles;
108
(vi) any
Purchase Price or Substitution Shortfall Amount delivered to the Servicer and
all proceeds (net of amounts payable or reimbursable to the Servicer, the Master
Servicer, the Trustee, the Custodian or the Securities Administrator) of
Mortgage Loans purchased in accordance with Section 2.03, Section 3.13 or
Section 10.01; and
(vii) any
Prepayment Charges collected by the Servicer in connection with the Principal
Prepayment of any of the Mortgage Loans or amounts required to be deposited
by
the Servicer in connection with a breach of its obligations under Section
2.05.
The
foregoing requirements for deposit in the Collection Account shall be exclusive,
it being understood and agreed that, without limiting the generality of the
foregoing, Ancillary Income, Prepayment Interest Excess and payments in the
nature of late payment charges, assumption fees or other similar fees need
not
be deposited by the Servicer in the Collection Account and may be retained
by
the Servicer as additional servicing compensation. In the event the Servicer
shall deposit in the Collection Account any amount not required to be deposited
therein, it may at any time withdraw such amount from the Collection Account,
any provision herein to the contrary notwithstanding.
(b) On
behalf
of the Trust Fund, the Securities Administrator shall establish and maintain
one
or more accounts (such account or accounts, the “Distribution Account”), held in
trust for the benefit of the Trustee, the Trust Fund and the Certificateholders.
On behalf of the Trust Fund, the Servicer shall deliver to the Securities
Administrator in immediately available funds for deposit in the Distribution
Account on or before 12:00 noon New York time on the Servicer Remittance Date,
that portion of the Available Distribution Amount (calculated without regard
to
the references in clause (2) of the definition thereof to amounts that may
be
withdrawn from the Distribution Account) for the related Distribution Date
then
on deposit in the Collection Account and the amount of all Prepayment Charges
collected by the Servicer in connection with the Principal Prepayment of any
of
the Mortgage Loans then on deposit in the Collection Account and the amount
of
any funds reimbursable to an Advance Financing Person pursuant to Section 3.26.
If the balance on deposit in a Collection Account exceeds $100,000 as of the
commencement of business on any Business Day and the Collection Account
constitutes an Eligible Account solely pursuant to clause (ii) of the definition
of “Eligible Account,” the Servicer shall, on or before 5:00 p.m. New York time
on such Business Day, withdraw from the Collection Account any and all amounts
payable or reimbursable to the Depositor, the Servicer, the Trustee, the Master
Servicer, the Securities Administrator or the Sponsor pursuant to Section 3.09
and shall pay such amounts to the Persons entitled thereto or shall establish
a
separate Collection Account (which shall also be an Eligible Account) and
withdraw from the existing Collection Account the amount on deposit therein
in
excess of $100,000 and deposit such excess in the newly created Collection
Account.
With
respect to any remittance received by the Securities Administrator after the
Servicer Remittance Date on which such payment was due, the Securities
Administrator shall send written notice thereof to the Servicer. The Servicer
shall pay to the Securities Administrator interest on any such late payment
by
the Servicer at an annual rate equal to Prime Rate (as defined in The
Wall Street Journal)
plus
one percentage point, but in no event greater than the maximum amount permitted
by applicable law. Such interest shall be paid by the Servicer to the Securities
Administrator on the date such late payment is made and shall cover the period
commencing with the day following such Servicer Remittance Date and ending
with
the Business Day on which such payment is made, both inclusive. The payment
by
the Servicer of any such interest, or the failure of the Securities
Administrator to notify the Servicer of such interest, shall not be deemed
an
extension of time for payment or a waiver of any Event of Default by the
Servicer.
109
(c) Funds
in
the Collection Account and funds in the Distribution Account may be invested
in
Permitted Investments in accordance with the provisions set forth in Section
3.10. The Servicer shall give notice to the Trustee, the Securities
Administrator and the Master Servicer of the location of the Collection Account
when established and prior to any change thereof. The Securities Administrator
shall give notice to the Servicer and the Depositor of the location of the
Distribution Account when established and prior to any change
thereof.
(d) Funds
held in the Collection Account at any time may be delivered by the Servicer
in
immediately available funds to the Securities Administrator for deposit in
the
Distribution Account. In the event the Servicer shall deliver to the Securities
Administrator for deposit in the Distribution Account any amount not required
to
be deposited therein, it may at any time request that the Securities
Administrator withdraw such amount from the Distribution Account and remit
to it
any such amount, any provision herein to the contrary notwithstanding. In no
event shall the Securities Administrator incur liability as a result of
withdrawals from the Distribution Account at the direction of the Servicer
in
accordance with the immediately preceding sentence. In addition, the Servicer
shall deliver to the Securities Administrator no later than the Servicer
Remittance Date the amounts set forth in clauses (i) through (iv)
below:
(i) any
P&I Advances, as required pursuant to Section 5.03;
(ii) any
amounts required to be deposited pursuant to Section 3.22(d) or 3.21(f) in
connection with any related REO Property;
(iii) any
amounts to be paid in connection with a purchase of Mortgage Loans and REO
Properties pursuant to Section 10.01; and
(iv) any
amounts required to be deposited pursuant to Section 3.23 in connection with
any
Prepayment Interest Shortfalls.
SECTION
3.09. Withdrawals
from the Collection Account and Distribution Account.
(a) The
Servicer shall, from time to time, make withdrawals from the Collection Account
for any of the following purposes or as described in Section 5.03:
(i) to
remit
to the Securities Administrator for deposit in the Distribution Account the
amounts required to be so remitted pursuant to Section 3.08(b) or permitted
to
be so remitted pursuant to the first sentence of Section 3.08(d);
(ii) subject
to Section 3.13(d), to reimburse itself (including any successor Servicer)
for
P&I Advances made by it, but only to the extent of amounts received which
represent Late Collections (net of the related Servicing Fees) of Monthly
Payments or rental and other income from the related REO Property on related
Mortgage Loans with respect to which such P&I Advances were made in
accordance with the provisions of Section 5.03;
110
(iii) subject
to Section 3.13(d), to pay itself any unpaid Servicing Fees and reimburse itself
any unreimbursed Servicing Advances with respect to each related Mortgage Loan,
but only to the extent of any Liquidation Proceeds and Insurance Proceeds
received with respect to such related Mortgage Loan or rental or other income
from the related REO Property;
(iv) to
pay to
itself as servicing compensation (in addition to the Servicing Fee or any
portion thereof payable to the Servicer) on the Servicer Remittance Date any
interest or investment income earned on funds deposited in the Collection
Account;
(v) to
pay to
itself or the Sponsor, as the case may be, with respect to each Mortgage Loan
that has previously been purchased or replaced pursuant to Section 2.03 or
Section 3.13(c) all amounts received thereon not included in the Purchase Price
or the Substitution Shortfall Amount;
(vi) to
reimburse itself (including any successor to the Servicer) for
(A) any
P&I Advance or Servicing Advance previously made by it which the Servicer
has determined to be a Nonrecoverable P&I Advance or a Nonrecoverable
Servicing Advance in accordance with the provisions of Section
5.03;
(B) any
unpaid Servicing Fees to the extent not recoverable from Liquidation Proceeds,
Insurance Proceeds or other amounts received with respect to the related
Mortgage Loan under Section 3.08(a)(iii); or
(C) any
P&I Advance or Servicing Advance made with respect to a delinquent Mortgage
Loan which Mortgage Loan has been modified by the Servicer in accordance with
the terms of this Agreement; provided that the Servicer shall only reimburse
itself for such P&I Advances and Servicing Advances at the time of such
modification, or as otherwise provided in this Section 3.09;
(vii) to
reimburse itself or the Depositor for expenses incurred by or reimbursable
to
itself or the Depositor, as the case may be, pursuant to Section 3.01 or Section
7.03;
(viii) to
reimburse itself or the Trustee, as the case may be, for expenses reasonably
incurred in respect of the breach or defect giving rise to the purchase
obligation under Section 2.03 of this Agreement that were included in the
Purchase Price of the related Mortgage Loan, including any expenses arising
out
of the enforcement of the purchase obligation;
111
(ix) to
pay,
or to reimburse itself for advances in respect of, expenses incurred in
connection with any related Mortgage Loan pursuant to Section 3.13(b);
(x) to
pay to
itself any Prepayment Interest Excess on the related Mortgage Loans to the
extent not retained pursuant to Section 3.08(a)(ii);
(xi) to
reimburse itself pursuant to Section 5.03(b) for any xxxxxxxxxxxx X&X
Advances (made from its own funds) from Amounts Held for Future Distribution
for
such Distribution Date (provided that such amounts must be replaced by the
Servicer by deposit in the Collection Account no later than the close of
business on the Servicer Remittance Date immediately following the Due Period
or
Prepayment Period for which such amounts relate); and
(xii) to
clear
and terminate the Collection Account pursuant to
Section 10.01.
The
Servicer shall keep and maintain separate accounting, on a Mortgage Loan by
Mortgage Loan basis, for the purpose of justifying any withdrawal from the
Collection Account, to the extent held by or on behalf of it, pursuant to
subclauses (ii), (iii), (v), (vi), (vii), (viii), (ix), (x) and (xi)
above.
(b) The
Securities Administrator shall, from time to time, make withdrawals from the
Distribution Account, for any of the following purposes, without
priority:
(i) to
make
distributions to Certificateholders in accordance with Section
5.01;
(ii) to
pay to
itself, the Custodian and the Master Servicer amounts to which it is entitled
pursuant to Section 9.05 or any other provision of this Agreement and any
Extraordinary Trust Fund Expenses;
(iii) to
reimburse itself or the Master Servicer pursuant to Section 8.02;
(iv) to
pay
any Net Swap Payment or Swap Termination Payment payable to the Supplemental
Interest Trust (unless the Swap Provider is the sole Defaulting Party or the
sole Affected Party (as defined in the Swap Agreement)) owed to the Swap
Provider;
(v) to
pay
any amounts in respect of taxes pursuant to Section 11.01(g)(v);
(vi) to
pay
the Master Servicing Fee to the Master Servicer;
(vii) to
pay
the Credit Risk Management Fee to the Credit Risk Manager; and
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(viii) to
clear
and terminate the Distribution Account pursuant to Section 10.01.
SECTION
3.10. Investment
of Funds in the Investment Accounts.
(a) The
Servicer may direct, by means of written directions (which may be standing
directions), any Depository Institution maintaining the Collection Account
to
invest the funds in the Collection Account (for purposes of this Section 3.10,
an “Investment Account”) in one or more Permitted Investments bearing interest
or sold at a discount, and maturing, unless payable on demand, (i) no later
than
the Business Day immediately preceding the date on which such funds are required
to be withdrawn from such account pursuant to this Agreement, if a Person other
than the Securities Administrator is the obligor thereon, and (ii) no later
than
the date on which such funds are required to be withdrawn from such account
pursuant to this Agreement, if the Securities Administrator is the obligor
on
such Permitted Investment. Amounts in the Distribution Account may be invested
in Permitted Investments as directed in writing by the Master Servicer and
maturing, unless payable on demand, (i) no later than the Business Day
immediately preceding the date on which such funds are required to be withdrawn
from such account pursuant to this Agreement, if a Person other than the
Securities Administrator is the obligor thereon, and (ii) no later than the
date
on which such funds are required to be withdrawn from such account pursuant
to
this Agreement, if the Securities Administrator is the obligor thereon. All
such
Permitted Investments shall be held to maturity, unless payable on demand.
Any
investment of funds shall be made in the name of the Trustee (in its capacity
as
such) or in the name of a nominee of the Trustee. The Securities Administrator
shall be entitled to sole possession over each such investment in the
Distribution Account and, subject to subsection (b) below, the income thereon,
and any certificate or other instrument evidencing any such investment shall
be
delivered directly to the Securities Administrator or its agent, together with
any document of transfer necessary to transfer title to such investment to
the
Trustee or its nominee. In the event amounts on deposit in the Collection
Account are at any time invested in a Permitted Investment payable on demand,
the party with investment discretion over such Investment Account
shall:
(x) consistent
with any notice required to be given thereunder, demand that payment thereon
be
made on the last day such Permitted Investment may otherwise mature hereunder
in
an amount equal to the lesser of (1) all amounts then payable thereunder and
(2)
the amount required to be withdrawn on such date; and
(y) demand
payment of all amounts due thereunder promptly upon receipt by such party of
written notice from the Servicer that such Permitted Investment would not
constitute a Permitted Investment in respect of funds thereafter on deposit
in
the Investment Account.
(b) All
income and gain realized from the investment of funds deposited in the
Collection Account shall be for the benefit of the Servicer and shall be subject
to its withdrawal in accordance with Section 3.09. The Servicer shall deposit
in
the Collection Account the amount of any loss incurred in respect of any such
Permitted Investment made with funds in such account immediately upon
realization of such loss. All earnings and gain realized from the investment
of
funds deposited in the Distribution Account shall be for the benefit of the
Master Servicer. The Master Servicer shall remit from its own funds for deposit
into the Distribution Account the amount of any loss incurred on Permitted
Investments in the Distribution Account.
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(c) Except
as
otherwise expressly provided in this Agreement, if any default occurs in the
making of a payment due under any Permitted Investment, or if a default occurs
in any other performance required under any Permitted Investment, the Trustee
may and, subject to Section 9.01 and Section 9.02(a)(v), shall, at the written
direction of the Servicer, take such action as may be appropriate to enforce
such payment or performance, including the institution and prosecution of
appropriate proceedings.
(d) The
Trustee, the Master Servicer or their respective Affiliates are permitted to
receive additional compensation that could be deemed to be in the Trustee’s or
the Master Servicer’s economic self-interest for (i) serving as investment
adviser, administrator, shareholder servicing agent, custodian or sub-custodian
with respect to certain of the Permitted Investments, (ii) using Affiliates
to
effect transactions in certain Permitted Investments and (iii) effecting
transactions in certain Permitted Investments. Such compensation shall not
be
considered an amount that is reimbursable or payable to the Trustee or the
Master Servicer pursuant to Section 3.09 or 3.10 or otherwise payable in respect
of Extraordinary Trust Fund Expenses. Such additional compensation shall not
be
an expense of the Trust Fund.
SECTION
3.11. Maintenance
of Hazard Insurance, Errors and Omissions and Fidelity Coverage and Primary
Mortgage Insurance.
(a) The
terms
of each Mortgage Note require the related Mortgagor to maintain fire, flood
and
hazard insurance policies. To the extent such policies are not maintained by
the
related Mortgagor, the Servicer shall cause to be maintained for each Mortgaged
Property fire and hazard insurance with extended coverage as is customary in
the
area where the Mortgaged Property is located in an amount which is at least
equal to the lesser of the current principal balance of the related Mortgage
Loan and the amount necessary to compensate fully for any damage or loss to
the
improvements which are a part of such property on a replacement cost basis,
in
each
case in an amount not less than such amount as is necessary to avoid the
application of any coinsurance clause contained in the related hazard insurance
policy.
The
Servicer shall also cause to be maintained fire and hazard insurance on each
REO
Property with extended coverage as is customary in the area where the Mortgaged
Property is located in an amount which is at least equal to the lesser of (i)
the maximum insurable value of the improvements which are a part of such
property and (ii) the outstanding principal balance of the related Mortgage
Loan
(including, with respect to each second lien Mortgage Loan, the outstanding
principal balance of the related first lien) at the time it became an REO
Property, in each case in an amount not less than such amount as is necessary
to
avoid the application of any coinsurance clause contained in the related hazard
insurance policy, in each case in an amount not less than such amount as is
necessary to avoid the application of any coinsurance clause contained in the
related hazard insurance policy. The Servicer will comply in the performance
of
this Agreement with all reasonable rules and requirements of each insurer under
any such hazard policies. Any amounts to be collected by the Servicer under
any
such policies (other than amounts to be applied to the restoration or repair
of
the property subject to the related Mortgage or amounts to be released to the
Mortgagor in accordance with Accepted Servicing Practices, subject to the terms
and conditions of the related Mortgage and Mortgage Note) shall be deposited
in
the Collection Account, subject to withdrawal pursuant to Section 3.09, if
received in respect of a Mortgage Loan, or in the REO Account, subject to
withdrawal pursuant to Section 3.21, if received in respect of an REO
Property. Any cost incurred by the Servicer in maintaining any such insurance
shall not, for the purpose of calculating distributions to Certificateholders,
be added to the unpaid principal balance of the related Mortgage Loan,
notwithstanding that the terms of such Mortgage Loan so permit. It is understood
and agreed that no earthquake or other additional insurance is to be required
of
any Mortgagor other than pursuant to such applicable laws and regulations as
shall at any time be in force and as shall require such additional insurance.
If
the Mortgaged Property or REO Property is at any time in an area identified
in
the Federal Register by the Federal Emergency Management Agency as having
special flood hazards, the Servicer will cause to be maintained a flood
insurance policy in respect thereof. Such flood insurance shall be in an amount
equal to the lesser of (i) the unpaid principal balance of the related Mortgage
Loan and (ii) the maximum amount of such insurance available for the related
Mortgaged Property under the national flood insurance program (assuming that
the
area in which such Mortgaged Property is located is participating in such
program), in each case in an amount not less than such amount as is necessary
to
avoid the application of any coinsurance clause contained in the related hazard
insurance policy.
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In
the
event that the Servicer shall obtain and maintain a blanket policy with an
insurer having a General Policy Rating of B:VI or better in Best’s Key Rating
Guide or otherwise acceptable to Xxxxxx Xxx or Xxxxxxx Mac insuring against
hazard losses on all of the related Mortgage Loans, it shall conclusively be
deemed to have satisfied its obligations to cause fire and hazard insurance
to
be maintained on the Mortgaged Properties, it being understood and agreed that
such policy may contain a deductible clause, in which case the Servicer shall,
in the event that there shall not have been maintained on the related Mortgaged
Property or REO Property a policy complying with this Section 3.11, and there
shall have been one or more losses which would have been covered by such policy,
deposit to the Collection Account from its own funds the amount not otherwise
payable under the blanket policy because of such deductible clause. In
connection with its activities as administrator and servicer of the related
Mortgage Loans, the Servicer agrees to prepare and present, on behalf of itself,
the Trustee, the Trust Fund, the Certificateholders, claims under any such
blanket policy in a timely fashion in accordance with the terms of such
policy.
(b) The
Servicer shall keep in force during the term of this Agreement a policy or
policies of insurance covering errors and omissions for failure in the
performance of its respective obligations under this Agreement, which policy
or
policies shall be in such form and amount that would meet the requirements
of
Xxxxxx Mae or Xxxxxxx Mac if it were the purchaser of the related Mortgage
Loans, unless the Servicer, has obtained a waiver of such requirements from
Xxxxxx Mae or Xxxxxxx Mac. The Servicer shall also maintain a fidelity bond
in
the form and amount that would meet the requirements of Xxxxxx Mae or Xxxxxxx
Mac, unless the Servicer, has obtained a waiver of such requirements from Xxxxxx
Mae or Xxxxxxx Mac. The Servicer shall be deemed to have complied with this
provision if an Affiliate of the Servicer has such errors and omissions and
fidelity bond coverage and, by the terms of such insurance policy or fidelity
bond, the coverage afforded thereunder extends to the Servicer. Any such errors
and omissions policy and fidelity bond shall by its terms not be cancelable
without thirty (30) days’ prior written notice to the Trustee.
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(c) The
Servicer shall not take any action that would result in noncoverage under any
applicable primary mortgage insurance policy of any loss which, but for the
actions of the Servicer would have been covered thereunder. The Servicer shall
use its best efforts to keep in force and effect any applicable primary mortgage
insurance policy and, to the extent that the related Mortgage Loan requires
the
Mortgagor to maintain such insurance, any other primary mortgage insurance
applicable to any Mortgage Loan. Except as required by applicable law or the
related Mortgage Loan Documents, the Servicer shall not cancel or refuse to
renew any such primary mortgage insurance policy that is in effect at the date
of the initial issuance of the related Mortgage Note and is required to be
kept
in force hereunder.
The
Servicer agrees to present on behalf of the Trustee and the Certificateholders
claims to the applicable insurer under any primary mortgage insurance policies
and, in this regard, to take such reasonable action as shall be necessary to
permit recovery under any primary mortgage insurance policies respecting
defaulted Mortgage Loans. Pursuant to Section 3.08 of this Agreement, any
amounts collected by the Servicer under any primary mortgage insurance policies
shall be deposited in the Collection Account, subject to withdrawal pursuant
to
Section 3.09 of this Agreement. Notwithstanding any provision to the
contrary, the Servicer shall not have any responsibility with respect to a
primary mortgage insurance policy unless the Servicer has been made aware of
such policy, as reflected on the Mortgage Loan Schedule or otherwise and have
been provided with adequate information to administer such policy.
(d) The
Servicer need not obtain the approval of the Master Servicer prior to releasing
any Insurance Proceeds to the Mortgagor to be applied to the restoration or
repair of the Mortgaged Property if such release is in accordance with Accepted
Servicing Practices. At a minimum, the Servicer shall comply with the following
conditions in connection with any such release of Insurance Proceeds in excess
of $10,000:
(i) the
Servicer shall receive satisfactory independent verification of completion
of
repairs and issuance of any required approvals with respect
thereto;
(ii) the
Servicer shall take all steps necessary to preserve the priority of the lien
of
the Mortgage, including, but not limited to requiring waivers with respect
to
mechanics’ and materialmen’s liens; and
(iii) pending
repairs or restoration, the Servicer shall place the Insurance Proceeds in
the
related Escrow Account, if any.
SECTION
3.12. Enforcement
of Due-on-Sale Clauses; Assumption Agreements
The
Servicer shall, to the extent it has knowledge of any conveyance of any related
Mortgaged Property by any related Mortgagor (whether by absolute conveyance
or
by contract of sale, and whether or not the Mortgagor remains or is to remain
liable under the Mortgage Note and/or the Mortgage), exercise its rights to
accelerate the maturity of such Mortgage Loan under the “due-on-sale” clause, if
any, applicable thereto; provided, however, that the Servicer shall not exercise
any such rights if prohibited by law from doing so. If the Servicer reasonably
believes that it is unable under applicable law to enforce such “due-on-sale”
clause, or if any of the other conditions set forth in the proviso to the
preceding sentence apply, the Servicer shall enter into an assumption and
modification agreement from or with the person to whom such property has been
conveyed or is proposed to be conveyed, pursuant to which such person becomes
liable under the Mortgage Note and, to the extent permitted by applicable state
law, the Mortgagor remains liable thereon. The Servicer is also authorized
to
enter into a substitution of liability agreement with such person, pursuant
to
which the original Mortgagor is released from liability and such person is
substituted as the Mortgagor and becomes liable under the Mortgage Note,
provided that no such substitution shall be effective unless such person
satisfies the then current underwriting criteria of the Servicer for mortgage
loans similar to the related Mortgage Loans. In connection with any assumption
or substitution, the Servicer shall apply such underwriting standards and follow
such practices and procedures as shall be normal and usual in its general
mortgage servicing activities and as it applies to other mortgage loans owned
solely by it. The Servicer shall not take or enter into any assumption and
modification agreement, however, unless (to the extent practicable in the
circumstances) it shall have received confirmation, in writing, of the continued
effectiveness of any applicable hazard insurance policy. Any fee collected
by
the Servicer in respect of an assumption or substitution of liability agreement
will be retained by the Servicer as additional servicing compensation. In
connection with any such assumption, no material term of the Mortgage Note
(including but not limited to the related Mortgage Rate and the amount of the
Monthly Payment) may be amended or modified, except as otherwise required
pursuant to the terms thereof. The Servicer shall notify the Trustee (or the
Custodian) that any such substitution or assumption agreement has been completed
by forwarding to the Trustee (or the Custodian) the executed original of such
substitution or assumption agreement, which document shall be added to the
related Mortgage File and shall, for all purposes, be considered a part of
such
Mortgage File to the same extent as all other documents and instruments
constituting a part thereof.
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Notwithstanding
the foregoing paragraph or any other provision of this Agreement, the Servicer
shall not be deemed to be in default, breach or any other violation of its
obligations hereunder by reason of any assumption of a Mortgage Loan by
operation of law or by the terms of the Mortgage Note or any assumption which
the Servicer may be restricted by law from preventing, for any reason whatever.
For purposes of this Section 3.12, the term “assumption” is deemed to also
include a sale (of the Mortgaged Property) subject to the Mortgage that is
not
accompanied by an assumption or substitution of liability
agreement.
SECTION
3.13. Realization
Upon Defaulted Mortgage Loans.
(a) The
Servicer shall use commercially reasonable efforts, consistent with Accepted
Servicing Practices, to foreclose upon or otherwise comparably convert the
ownership of properties securing such of the Mortgage Loans as come into and
continue in default and as to which no satisfactory arrangements can be made
for
collection of delinquent payments pursuant to Section 3.06. The Servicer
shall be responsible for all costs and expenses incurred by it in any such
proceedings; provided, however, that such costs and expenses will be recoverable
as Servicing Advances by the Servicer as contemplated in Sections 3.09 and
3.21.
The foregoing is subject to the provision that, in any case in which a Mortgaged
Property shall have suffered damage from an Uninsured Cause, the Servicer shall
not be required to expend its own funds toward the restoration of such property
unless it shall determine in its discretion that such restoration will increase
the proceeds of liquidation of the related Mortgage Loan after reimbursement
to
itself for such expenses.
117
(b) Notwithstanding
the foregoing provisions of this Section 3.13 or any other provision of
this Agreement, with respect to any Mortgage Loan as to which the Servicer
has
received actual notice of, or has actual knowledge of, the presence of any
toxic
or hazardous substance on the related Mortgaged Property, the Servicer shall
not, on behalf of the Trust Fund, either (i) obtain title to such Mortgaged
Property as a result of or in lieu of foreclosure or otherwise, or (ii)
otherwise acquire possession of, or take any other action with respect to,
such
Mortgaged Property, if, as a result of any such action, the Trust Fund, the
Trustee or the Certificateholders would be considered to hold title to, to
be a
“mortgagee-in-possession” of, or to be an “owner” or “operator” of such
Mortgaged Property within the meaning of the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended from time to time,
or any comparable law, unless the Servicer has also previously determined,
based
on its reasonable judgment and a prudent report prepared by an Independent
Person who regularly conducts environmental audits using customary industry
standards, that:
(1) such
Mortgaged Property is in compliance with applicable environmental laws or,
if
not, that it would be in the best economic interest of the Trust Fund to take
such actions as are necessary to bring the Mortgaged Property into compliance
therewith; and
(2) there
are
no circumstances present at such Mortgaged Property relating to the use,
management or disposal of any hazardous substances, hazardous materials,
hazardous wastes or petroleum-based materials for which investigation, testing,
monitoring, containment, clean-up or remediation could be required under any
federal, state or local law or regulation, or that if any such materials are
present for which such action could be required, that it would be in the best
economic interest of the Trust Fund to take such actions with respect to the
affected Mortgaged Property.
The
cost
of the environmental audit report contemplated by this Section 3.13 shall
be advanced by the Servicer, subject to the Servicer’s right to be reimbursed
therefor from the Collection Account as provided in Section 3.09(a)(ix),
such right of reimbursement being prior to the rights of Certificateholders
to
receive any amount in the Collection Account received in respect of the affected
Mortgage Loan or other Mortgage Loans.
If
the
Servicer determines, as described above, that it is in the best economic
interest of the Trust Fund to take such actions as are necessary to bring any
such Mortgaged Property into compliance with applicable environmental laws,
or
to take such action with respect to the containment, clean-up or remediation
of
hazardous substances, hazardous materials, hazardous wastes, or petroleum-based
materials affecting any such Mortgaged Property, then the Servicer shall take
such action as it deems to be in the best economic interest of the Trust Fund.
The cost of any such compliance, containment, cleanup or remediation shall
be
advanced by the Servicer, subject to the Servicer’s right to be reimbursed
therefor from the Collection Account as provided in Sections 3.09(a)(iii) or
3.09(a)(ix), such right of reimbursement being prior to the rights of
Certificateholders to receive any amount in the Collection Account received
in
respect of the affected Mortgage Loan or other Mortgage Loans.
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(c) The
Servicer shall have the right to purchase from REMIC I any defaulted Mortgage
Loan that is 90 days or more delinquent, which such Servicer determines in
good
faith will otherwise become subject to foreclosure proceedings (evidence of
such
determination to be delivered in writing to the Trustee, in form and substance
satisfactory to the Servicer and the Trustee prior to purchase), at a price
equal to the Purchase Price. The Purchase Price for any Mortgage Loan purchased
hereunder shall be deposited in the Collection Account, and the Trustee, upon
receipt of written certification from the Servicer of such deposit, shall
release or cause to be released to the Servicer the related Mortgage File and
the Trustee shall execute and deliver such instruments of transfer or
assignment, in each case without recourse, representation or warranty, as the
Servicer shall furnish and as shall be necessary to vest in the Servicer title
to any Mortgage Loan released pursuant hereto.
(d) Proceeds
received in connection with any Final Recovery Determination, as well as any
recovery resulting from a partial collection of Insurance Proceeds or
Liquidation Proceeds, in respect of any Mortgage Loan, will be applied in the
following order of priority: first, to reimburse the related Servicer for any
related xxxxxxxxxxxx X&X Advances and Servicing Advances, pursuant to
Section 3.09(a)(ii) or (a)(iii); second, to accrued and unpaid interest on
the Mortgage Loan, to the date of the Final Recovery Determination, or to the
Due Date prior to the Distribution Date on which such amounts are to be
distributed if not in connection with a Final Recovery Determination; and third,
as a recovery of principal of the Mortgage Loan. If the amount of the recovery
so allocated to interest is less than the full amount of accrued and unpaid
interest due on such Mortgage Loan, the amount of such recovery will be
allocated by the Servicer as follows: first, to unpaid Servicing Fees; and
second, to the balance of the interest then due and owing. The portion of the
recovery so allocated to unpaid Servicing Fees shall be reimbursed to the
Servicer pursuant to Section 3.09(a)(iii). The portion of the recovery
allocated to interest (net of unpaid Servicing Fees) and the portion of the
recovery allocated to principal of the Mortgage Loan shall be applied as
follows: first, to reimburse the related Servicer for any related unreimbursed
Servicing Advances or P&I Advances in accordance with
Section 3.09(a)(ii) and any other amounts reimbursable to the Servicer
pursuant to Section 3.09, and second, as part of the amounts to be
transferred to the Distribution Account in accordance with Section 3.08(b).
Excess proceeds, if any, from the liquidation of a Liquidated Mortgage Loan
will
be retained by the Servicer as additional servicing compensation pursuant to
Section 3.15.
SECTION
3.14. Trustee
to Cooperate; Release of Mortgage Files.
(a) Upon
becoming aware of the payment in full of any Mortgage Loan, or the receipt
by
the Servicer of a notification that payment in full has been escrowed in a
manner customary for such purposes for payment to Certificateholders on the
next
Distribution Date, the Servicer will promptly furnish to the Custodian, on
behalf of the Trustee, two copies of a request for release substantially in
the
form attached to the Custodial Agreement signed by a Servicing Officer or in
a
mutually agreeable electronic format which will, in lieu of a signature on
its
face, originate from a Servicing Officer (which certification shall include
a
statement to the effect that all amounts received in connection with such
payment that are required to be deposited in the Collection Account have been
or
will be so deposited) and shall request that the Custodian, on behalf of the
Trustee, deliver to the Servicer the related Mortgage File. Upon receipt of
such
certification and request, the Custodian, on behalf of the Trustee, shall within
five (5) Business Days release the related Mortgage File to the Servicer and
the
Trustee and the Custodian shall have no further responsibility with regard
to
such Mortgage File. Upon any such payment in full, the Servicer is authorized,
to give, as agent for the Trustee, as the mortgagee under the Mortgage that
secured the Mortgage Loan, an instrument of satisfaction (or assignment of
mortgage without recourse) regarding the Mortgaged Property subject to the
Mortgage, which instrument of satisfaction or assignment, as the case may be,
shall be delivered to the Person or Persons entitled thereto against receipt
therefor of such payment, it being understood and agreed that no expenses
incurred in connection with such instrument of satisfaction or assignment,
as
the case may be, shall be chargeable to the Collection Account, unless it shall
represent a Servicing Advance.
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(b) From
time
to time and as appropriate for the servicing or foreclosure of any Mortgage
Loan, the Trustee shall execute such documents as shall be prepared and
furnished to the Trustee by the Servicer (in form reasonably acceptable to
the
Trustee) and as are necessary to the prosecution of any such proceedings. The
Custodian, on behalf of the Trustee, shall, upon the request of the Servicer,
and delivery to the Custodian, on behalf of the Trustee, of two copies of a
request for release signed by a Servicing Officer substantially in the form
attached to the Custodial Agreement (or in a mutually agreeable electronic
format which will, in lieu of a signature on its face, originate from a
Servicing Officer), release within five (5) Business Days the related Mortgage
File held in its possession or control to the Servicer. Such trust receipt
shall
obligate the Servicer to return the Mortgage File to the Custodian on behalf
of
the Trustee, when the need therefor by the Servicer no longer exists unless
the
Mortgage Loan shall be liquidated, in which case, upon receipt of a certificate
of a Servicing Officer similar to that hereinabove specified, the Mortgage
File
shall be released by the Custodian, on behalf of the Trustee, to the
Servicer.
Notwithstanding
the foregoing, in connection with a Principal Prepayment in full of any Mortgage
Loan, the Master Servicer may request release of the related Mortgage File
from
the Custodian, in accordance with the provisions of the Custodial Agreement,
in
the event the Servicer fails to do so.
Upon
written certification of a Servicing Officer, the Trustee shall execute and
deliver to the Servicer, any court pleadings, requests for trustee’s sale or
other documents prepared and delivered to the Trustee and reasonably acceptable
to it and necessary to the foreclosure or trustee’s sale in respect of a
Mortgaged Property or to any legal action brought to obtain judgment against
any
Mortgagor on the Mortgage Note or Mortgage or to obtain a deficiency judgment,
or to enforce any other remedies or rights provided by the Mortgage Note or
Mortgage or otherwise available at law or in equity. Each such certification
shall include a request that such pleadings or documents be executed by the
Trustee and a statement as to the reason such documents or pleadings are
required and that the execution and delivery thereof by the Trustee will not
invalidate or otherwise affect the lien of the Mortgage, except for the
termination of such a lien upon completion of the foreclosure or trustee’s sale.
So long as no Servicer Event of Default shall have occurred and be continuing,
the Servicer shall have the right to execute any and all such court pleadings,
requests and other documents as attorney-in-fact for, and on behalf of the
Trustee. Notwithstanding the preceding sentence, the Trustee shall in no way
be
liable or responsible for the willful malfeasance of the Servicer, or for any
wrongful or negligent actions taken by the Servicer, while the Servicer is
acting in its capacity as attorney-in-fact for and on behalf of the
Trustee.
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SECTION
3.15. Servicing
Compensation.
As
compensation for its activities hereunder, the Servicer shall be entitled to
the
Servicing Fee with respect to each Mortgage Loan serviced by it payable solely
from payments of interest in respect of such Mortgage Loan, subject to Section
3.23. In addition, the Servicer shall be entitled to recover unpaid Servicing
Fees out of Insurance Proceeds or Liquidation Proceeds to the extent permitted
by Section 3.09(a)(iii), Section 3.09(a)(vi) and out of amounts derived from
the
operation and sale of an REO Property to the extent permitted by Section 3.22.
Except as permitted under Section 7.04, the right to receive the Servicing
Fee
may not be transferred in whole or in part except in connection with the
transfer of all of the Servicer’s responsibilities and obligations under this
Agreement to the extent permitted herein.
Additional
servicing compensation in the form of Ancillary Income (other than Prepayment
Charges) shall be retained by the Servicer only to the extent such fees or
charges are received by the Servicer. The Servicer shall also be entitled
pursuant to Section 3.09(a)(iv) to withdraw from the Collection Account and
pursuant to Section 3.22(b) to withdraw from any REO Account, as additional
servicing compensation, interest or other income earned on deposits therein,
subject to Section 3.10. In addition, the Servicer shall be entitled to retain
or withdraw from the Collection Account, pursuant to Section 3.09(a)(x), any
Prepayment Interest Excess with respect to the Mortgage Loans serviced by it
as
additional servicing compensation. The Servicer shall be required to pay all
expenses incurred by it in connection with its servicing activities hereunder
and shall not be entitled to reimbursement therefor except as specifically
provided herein.
SECTION
3.16. Collection
Account Statements.
Upon
request, not later than fifteen (15) days after each Distribution Date, the
Servicer shall forward to the Master Servicer and the Securities Administrator
and the Depositor, a statement prepared by the institution at which the
Collection Account is maintained setting forth the status of the Collection
Account as of the close of business on such Distribution Date and showing,
for
the period covered by such statement, the aggregate amount of deposits into
and
withdrawals from the Collection Account. Copies of such statement and any
similar statements provided by the Servicer shall be provided by the Securities
Administrator to any Certificateholder and to any Person identified to the
Securities Administrator as a prospective transferee of a Certificate, upon
request at the expense of the requesting party, provided such statement is
delivered by the Servicer to the Securities Administrator.
SECTION
3.17. Annual
Statement as to Compliance.
(a) The
Servicer shall deliver (and shall cause any Sub-Servicer engaged by it to
deliver) to the Master Servicer and to the Depositor on or before March 15
of
each year, commencing in March 2008, an Officer’s Certificate stating, as to the
signer thereof, that (A) a review of such party’s activities during the
preceding calendar year or portion thereof and of the Servicer’s performance
under this Agreement, or such other applicable agreement in the case of a
Sub-Servicer, has been made under such officer’s supervision and (B) to the best
of such officer’s knowledge, based on such review, such party has fulfilled all
its obligations under this Agreement, or such other applicable agreement in
the
case of a Sub-Servicer, in all material respects throughout such year or portion
thereof, or, if there has been a failure to fulfill any such obligation in
any
material respect, specifying each such failure known to such officer and the
nature and status thereof. Promptly after receipt of each such Officer’s
Certificate from the Servicer, any Sub-Servicer engaged by the Servicer, the
Depositor shall review such Officer’s Certificate and, if applicable, consult
with each such party, as applicable, as to the nature of any failures by such
party, in the fulfillment of any of the Servicer’s obligations hereunder or, in
the case of a Sub-Servicer, under such other applicable agreement.
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(b) Failure
of the Servicer to comply timely with this Section 3.17 shall be deemed a
Servicer Event of Default as to the Servicer, automatically, without notice
and
without any cure period, and the Master Servicer may, in addition to whatever
rights the Master Servicer may have under this Agreement and at law or in equity
or to damages, including injunctive relief and specific performance, terminate
all the rights and obligations of the Servicer under this Agreement and in
and
to the Mortgage Loans and the proceeds thereof without compensating the Servicer
for the same (other than the Servicer’s right to reimbursement of xxxxxxxxxxxx
X&X Advances and Servicing Advances and accrued and unpaid Servicing Fees in
the manner provided in this Agreement). This paragraph shall supersede any
other
provision in this Agreement or any other agreement to the contrary.
(c) In
the
event the Servicer or any Sub-Servicer engaged by the Servicer is terminated,
assigns its rights and obligations under or resigns pursuant to the terms of
this Agreement, or any applicable agreement in the case of a Sub-Servicer,
as
the case may be, such party shall provide an Officer’s Certificate with respect
to the related year pursuant to this Section 3.17(c) or to such other applicable
agreement, as the case may be, notwithstanding any such termination, assignment
or resignation for the related year.
SECTION
3.18. Assessments
of Compliance and Attestation Reports.
(a) By
March
15 of each year, commencing in March 2008, the Servicer, at its own expense,
shall furnish, and shall cause any Servicing Function Participant engaged by
it
to furnish, each at its own expense, to the Master Servicer, a report on an
assessment of compliance with the Relevant Servicing Criteria that contains
(A)
a statement by such party of its responsibility for assessing compliance with
the Relevant Servicing Criteria, (B) a statement that such party used the
Relevant Servicing Criteria to assess compliance with the Relevant Servicing
Criteria, (C) such party’s assessment of compliance with the Relevant Servicing
Criteria as of and for the fiscal year covered by the Form 10-K required to
be
filed pursuant to Section 5.06(d), including, if there has been any material
instance of noncompliance with the Relevant Servicing Criteria, a discussion
of
each such failure and the nature and status thereof, and (D) a statement that
a
registered public accounting firm has issued an attestation report on such
party’s assessment of compliance with the Relevant Servicing Criteria as of and
for such period. Notwithstanding the foregoing, neither the Servicer nor any
Servicing Function Participant engaged by the Servicer shall be required to
deliver any assessments until March 31st in any given year so long as it has
not
received written confirmation from the Depositor that a Form 10-K is required
to
be filed in respect of the Trust for the preceding calendar year; provided
however that, notwithstanding the foregoing, no Subcontractor will be required
to deliver any assessments in any given year in which the Form 10-K is not
required to be filed.
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(b) By
March
15 of each year, commencing in March 2008, the Servicer, at its own expense,
shall cause, and the Servicer shall cause any Servicing Function Participant
engaged by it to cause, each at its own expense, a registered public accounting
firm (which may also render other services to the Servicer or such other
Servicing Function Participants, as the case may be) and that is a member of
the
American Institute of Certified Public Accountants to furnish a report to the
Master Servicer, to the effect that (i) it has obtained a representation
regarding certain matters from the management of such party, which includes
an
assertion that such party has complied with the Relevant Servicing Criteria,
and
(ii) on the basis of an examination conducted by such firm in accordance with
standards for attestation engagements issued or adopted by the PCAOB, it is
expressing an opinion as to whether such party’s compliance with the Relevant
Servicing Criteria was fairly stated in all material respects, or it cannot
express an overall opinion regarding such party’s assessment of compliance with
the Relevant Servicing Criteria. In the event that an overall opinion cannot
be
expressed, such registered public accounting firm shall state in such report
why
it was unable to express such an opinion. Such report must be available for
general use and not contain restricted use language. Notwithstanding the
foregoing, neither the Servicer nor any Servicing Function Participant engaged
by the Servicer shall be required to deliver or cause the delivery of such
reports until March 31st in any given year so long as the Servicer has not
received written confirmation from the Depositor that a Form 10-K is required
to
be filed in respect of the Trust for the preceding fiscal year; provided however
that, notwithstanding the foregoing, no Subcontractor will be required to
deliver any reports in any given year in which the Form 10-K is not required
to
be filed.
(c) Failure
of the Servicer to comply timely with this Section 3.18 shall be deemed a
Servicer Event of Default as to the Servicer, automatically, without notice
and
without any cure period, and the Master Servicer may, in addition to whatever
rights the Master Servicer may have under this Agreement and at law or in equity
or to damages, including injunctive relief and specific performance, terminate
all the rights and obligations of the Servicer under this Agreement and in
and
to the Mortgage Loans and the proceeds thereof without compensating the Servicer
for the same (other than the Servicer’s right to reimbursement of xxxxxxxxxxxx
X&X Advances and Servicing Advances and accrued and unpaid Servicing Fees in
the manner provided for in this Agreement). This paragraph shall supersede
any
other provision in this Agreement or any other agreement to the
contrary.
(d) In
the
event the Servicer or any Servicing Function Participant engaged by the Servicer
is terminated, assigns its rights and obligations under, or resigns pursuant
to
the terms of this Agreement, or any applicable agreement in the case of a
Servicing Function Participant, as the case may be, such party shall provide
a
report on assessment of compliance with respect to the related year pursuant
to
this Section 3.18(d) or to such other applicable agreement, notwithstanding
any
such termination, assignment or resignation for the related year.
SECTION
3.19. [Reserved].
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SECTION
3.20. Annual
Certification; Additional Information.
(a) The
Servicer shall and shall cause any Servicing Function Participant engaged by
it
to, provide to the Person who signs the Xxxxxxxx-Xxxxx Certification (the
“Certifying Person”), by March 15 of each year in which the Trust is subject to
the reporting requirements of the Exchange Act, a certification (each, a
“Back-Up Certification”), in the form attached hereto as Exhibit C, upon which
the Certifying Person, the entity for which the Certifying Person acts as an
officer, and such entity’s officers, directors and Affiliates (collectively with
the Certifying Person, “Certification Parties”) can reasonably rely. The officer
of the Master Servicer in charge of the master servicing function shall serve
as
the Certifying Person on behalf of the Trust. In the event the Servicer or
any
Servicing Function Participant engaged by it is terminated or resigns pursuant
to the terms of this Agreement, or any applicable Sub-Servicing agreement,
as
the case may be, such party shall provide a Back-Up Certification to the
Certifying Person pursuant to this Section 3.20 with respect to the period
of
time it was subject to this Agreement or any applicable Sub-Servicing Agreement,
as the case may be.
(b) The
Servicer shall indemnify and hold harmless the Master Servicer, the Securities
Administrator, the Trustee, the Depositor and their respective officers,
directors, agents and affiliates from and against any losses, damages,
penalties, fines, forfeitures, reasonable legal fees and related costs,
judgments and other costs and expenses arising out of or based upon a breach
by
the Servicer or any of its officers, directors, agents or affiliates of its
obligations under this Section 3.20 or the Servicer’s negligence, bad faith or
willful misconduct in connection therewith. Such indemnity shall survive the
termination or resignation of the parties hereto or the termination of this
Agreement. If the indemnification provided for herein is unavailable or
insufficient to hold harmless the Master Servicer, the Securities Administrator,
the Trustee and the Depositor, then the Servicer agrees that it shall contribute
to the amount paid or payable by the Master Servicer, the Securities
Administrator, the Trustee and the Depositor as a result of the losses, claims,
damages or liabilities of the Master Servicer, the Securities Administrator,
the
Trustee and the Depositor in such proportion as is appropriate to reflect the
relative fault of the Master Servicer, the Securities Administrator, the Trustee
and the Depositor on the one hand and the Servicer on the other in connection
with a breach of the Servicer’s obligations under this Section
3.20.
(c) The
Servicer shall provide to the Master Servicer prompt notice of the occurrence
of
any of the following:
(i) any
Servicer Event of Default under the terms of this Agreement, any merger,
consolidation or sale of substantially all of the assets of Servicer, Servicer’s
engagement of any Sub-Servicer to perform or assist in the performance of any
of
such Servicer’s obligations under this Agreement, any material litigation
involving Servicer that is material to the Certificateholders, and to the extent
disclosure is required under Regulation AB, any affiliation or other significant
relationship between Servicer and WMC Mortgage Corporation, the Sponsor, the
Depositor, the Master Servicer, the Securities Administrator, the Trustee,
the
Custodian, the Cap Counterparty and the Swap Provider.
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(ii) If
the
Servicer has knowledge of the occurrence of any of the events described in
this
clause (ii), then no later than ten days prior to the deadline for the filing
of
any Distribution Report on Form 10-D in respect of the Trust, the Servicer
shall
provide to the Master Servicer notice of the occurrence of any of the following
events along with all information, data, and materials related thereto as may
be
required to be included in the related Distribution Report on Form 10-D (as
specified in the provisions of Regulation AB referenced below):
(A) any
material modifications, extensions or waivers of pool asset terms, fees,
penalties or payments during the distribution period or that have cumulatively
become material over time (Item 1121(a)(11) of Regulation AB);
(B) material
breaches of pool asset representations or warranties or transaction covenants
(Item 1121(a)(12) of Regulation AB); and
(C) any
material pool asset changes (such as, additions, substitutions or repurchases)
relating to the Mortgage Loans serviced by the Servicer (Item 1121(a)(14) of
Regulation AB).
(d) The
Servicer shall provide to the Securities Administrator and Master Servicer
such
additional information as the Securities Administrator and the Master Servicer
may reasonably request, including evidence of the authorization of the person
signing any certification or statement, financial information and reports and
of
the fidelity bond and errors and omissions insurance policy required to be
maintained by the Servicer pursuant to this Agreement, and such other
information related to the Servicer or its performance hereunder.
SECTION
3.21. Access
to
Certain Documentation.
The
Servicer shall provide to the Office of Thrift Supervision, the FDIC, and any
other federal or state banking or insurance regulatory authority that may
exercise authority over any Certificate Owner, access to the documentation
regarding the related Mortgage Loans required by applicable laws and
regulations. Such access shall be afforded without charge, but only upon
reasonable request and during normal business hours at the offices of the
Servicer designated by it. Nothing in this Section 3.21 shall limit the
obligation of the Servicer to comply with any applicable law prohibiting
disclosure of information regarding the Mortgagors and the failure of the
Servicer to provide access as provided in this Section as a result of such
obligation shall not constitute a breach of this Section. Nothing in this
Section 3.21 shall require the Servicer to collect, create, collate or otherwise
generate any information that it does not generate in its usual course of
business. The Servicer shall not be required to make copies of or ship documents
to any Person unless provisions have been made for the reimbursement of the
costs thereof.
SECTION
3.22. Title,
Management and Disposition of REO Property.
(a) The
deed
or certificate of sale of any REO Property related to a Mortgage Loan shall
be
taken in the name of the Trustee, or its nominee, on behalf of the Trust Fund
and for the benefit of the Certificateholders. The Servicer, on behalf of REMIC
I, shall either sell any REO Property by the close of the third calendar year
following the calendar year in which REMIC I acquires ownership of such REO
Property for purposes of Section 860(a)(8) of the Code or request from the
Internal Revenue Service, no later than sixty (60) days before the day on which
the three-year grace period would otherwise expire, an extension of the
three-year grace period, unless the Servicer had delivered to the Trustee an
Opinion of Counsel, addressed to the Trustee and the Depositor, to the effect
that the holding by REMIC I of such REO Property subsequent to three (3) years
after its acquisition will not result in the imposition on any Trust REMIC
created hereunder of taxes on “prohibited transactions” thereof, as defined in
Section 860F of the Code, or cause any Trust REMIC hereunder to fail to qualify
as a REMIC under Federal law at any time that any Certificates are outstanding.
The Servicer shall manage, conserve, protect and operate each REO Property
for
the Certificateholders solely for the purpose of its prompt disposition and
sale
in a manner which does not cause such REO Property to fail to qualify as
“foreclosure property” within the meaning of Section 860G(a)(8) of the Code or
result in the receipt by any Trust REMIC created hereunder of any “income from
non-permitted assets” within the meaning of Section 860F(a)(2)(B) of the Code,
or any “net income from foreclosure property” which is subject to taxation under
the REMIC Provisions.
125
(b) The
Servicer shall segregate and hold all funds collected and received in connection
with the operation of any REO Property separate and apart from its own funds
and
general assets and shall establish and maintain with respect to REO Properties
an account held in trust for the Trustee, on behalf of the Trust Fund and for
the benefit of the Certificateholders (the “REO Account”), which shall be an
Eligible Account. The Servicer shall be permitted to allow the Collection
Account to serve as the REO Account, subject to the maintenance of separate
ledgers for each REO Property. The Servicer shall be entitled to retain or
withdraw any interest income paid on funds deposited in the related REO
Account.
(c) The
Servicer shall have full power and authority, subject only to the specific
requirements and prohibitions of this Agreement, to do any and all things in
connection with any REO Property related to a Mortgage Loan serviced by it
as
are consistent with the manner in which the Servicer manages and operates
similar property owned by it or any of its Affiliates, all on such terms and
for
such period as the Servicer deems to be in the best interests of
Certificateholders. In connection therewith, the Servicer shall deposit, or
cause to be deposited in the clearing account in which it customarily deposits
payments and collections on mortgage loans in connection with its mortgage
loan
servicing activities on a daily basis, and in no event more than one (1)
Business Day after the Servicer’s receipt thereof, and shall thereafter deposit
in the REO Account, in no event more than two (2) Business Days after the
deposit of good funds into the clearing account, all revenues received by it
with respect to an REO Property related to a Mortgage Loan serviced by it and
shall withdraw therefrom funds necessary for the proper operation, management
and maintenance of such REO Property including, without limitation:
(i) all
insurance premiums due and payable in respect of such REO Property;
(ii) all
real
estate taxes and assessments in respect of such REO Property that may result
in
the imposition of a lien thereon; and
(iii) all
costs
and expenses necessary to maintain such REO Property.
126
To
the
extent that amounts on deposit in the REO Account with respect to an REO
Property are insufficient for the purposes set forth in clauses (i) through
(iii) above with respect to such REO Property, the Servicer shall advance from
its own funds such amount as is necessary for such purposes if, but only if,
the
Servicer would make such advances if the Servicer owned the REO Property and
if
in the Servicer’s judgment, the payment of such amounts will be recoverable from
the rental or sale of the REO Property.
Subject
to compliance with applicable laws and regulations as shall at any time be
in
force, and notwithstanding the foregoing, the Servicer, on behalf of the Trust
Fund, shall not:
(i) enter
into, renew or extend any New Lease with respect to any REO Property, if the
New
Lease by its terms will give rise to any income that does not constitute Rents
from Real Property;
(ii) permit
any amount to be received or accrued under any New Lease other than amounts
that
will constitute Rents from Real Property;
(iii) authorize
or permit any construction on any REO Property, other than the completion of
a
building or other improvement thereon, and then only if more than ten percent
of
the construction of such building or other improvement was completed before
default on the related Mortgage Loan became imminent, all within the meaning
of
Section 856(e)(4)(B) of the Code; or
(iv) allow
any
Person to Directly Operate any REO Property on any date more than ninety (90)
days after its date of acquisition by the Trust Fund;
unless,
in any such case, the Servicer has obtained an Opinion of Counsel, provided
to
the Servicer and the Trustee, to the effect that such action will not cause
such
REO Property to fail to qualify as “foreclosure property” within the meaning of
Section 860G(a)(8) of the Code at any time that it is held by REMIC I, in which
case the Servicer may take such actions as are specified in such Opinion of
Counsel.
The
Servicer may contract with any Independent Contractor for the operation and
management of any REO Property, provided that:
(i) the
terms
and conditions of any such contract shall not be inconsistent
herewith;
(ii) any
such
contract shall require, or shall be administered to require, that the
Independent Contractor pay all costs and expenses incurred in connection with
the operation and management of such REO Property, including those listed above
and remit all related revenues (net of such costs and expenses) to the Servicer
as soon as practicable, but in no event later than thirty (30) days following
the receipt thereof by such Independent Contractor;
(iii) none
of
the provisions of this Section 3.22(c) relating to any such contract or to
actions taken through any such Independent Contractor shall be deemed to relieve
the Servicer of any of its duties and obligations to the Trustee on behalf
of
the Trust Fund and for the benefit of the Certificateholders with respect to
the
operation and management of any such REO Property; and
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(iv) the
Servicer shall be obligated with respect thereto to the same extent as if it
alone were performing all duties and obligations in connection with the
operation and management of such REO Property.
The
Servicer shall be entitled to enter into any agreement with any Independent
Contractor performing services for it related to its duties and obligations
hereunder for indemnification of the Servicer by such Independent Contractor,
and nothing in this Agreement shall be deemed to limit or modify such
indemnification. The Servicer shall be solely liable for all fees owed by it
to
any such Independent Contractor, irrespective of whether the Servicer’s
compensation pursuant to Section 3.15 is sufficient to pay such fees. Any such
agreement shall include a provision that such agreement may be immediately
terminated by any successor Servicer without fee, in the event the Servicer
shall for any reason, no longer be the Servicer of the Mortgage Loans (including
termination due to a Servicer Event of Default).
(d) In
addition to the withdrawals permitted under Section 3.22(c), the Servicer may
from time to time make withdrawals from the REO Account for any REO Property:
(i) to pay itself unpaid Servicing Fees in respect of the related Mortgage
Loan;
and (ii) to reimburse itself or any Sub-Servicer for unreimbursed Servicing
Advances and Advances made in respect of such REO Property or the related
Mortgage Loan. On the Servicer Remittance Date, the Servicer shall withdraw
from
each REO Account and deposit into the Distribution Account in accordance with
Section 3.08(d)(ii), for distribution on the related Distribution Date in
accordance with Section 5.01, the income from the related REO Property received
during the prior calendar month, net of any withdrawals made pursuant to Section
3.22(c) or this Section 3.22(d).
(e) Subject
to the time constraints set forth in Section 3.22(a), each REO Disposition
shall
be carried out by the Servicer at such price and upon such terms and conditions
as the Servicer shall deem necessary or advisable, as shall be normal and usual
in accordance with Accepted Servicing Practices.
(f) The
proceeds from the REO Disposition, net of any amount required by law to be
remitted to the Mortgagor under the related Mortgage Loan and net of any payment
or reimbursement to the Servicer as provided above, shall be deposited in the
Distribution Account in accordance with Section 3.08(d)(ii) on the Servicer
Remittance Date in the month following the receipt thereof for distribution
on
the related Distribution Date in accordance with Section 5.01. Any REO
Disposition shall be for cash only (unless changes in the REMIC Provisions
made
subsequent to the Startup Day allow a sale for other
consideration).
(g) The
Servicer shall file information returns (and shall provide a certification
of a
Servicing Officer to the Master Servicer that such filings have been made)
with
respect to the receipt of mortgage interest received in a trade or business,
reports of foreclosures and abandonments of any Mortgaged Property and
cancellation of indebtedness income with respect to any Mortgaged Property
as
required by Sections 6050H, 6050J and 6050P of the Code, respectively. Such
reports shall be in form and substance sufficient to meet the reporting
requirements imposed by such Sections 6050H, 6050J and 6050P of the
Code.
128
SECTION
3.23. Obligations
of the Servicer in Respect of Prepayment Interest Shortfalls; Relief Act
Interest Shortfalls.
The
Servicer shall deliver to the Securities Administrator for deposit into the
Distribution Account on or before 12:00 noon New York time on the Servicer
Remittance Date from its own funds an amount equal to the lesser of (i) the
aggregate amount of the Prepayment Interest Shortfalls attributable to Principal
Prepayments in full on the related Mortgage Loans for the related Distribution
Date resulting solely from voluntary Principal Prepayments received by the
Servicer during the portion of the related Prepayment Period occurring between
the sixteenth (16th)
day of
the month preceding the month in which the related Distribution Date occurs
and
ending on the last day of such month and (ii) the aggregate amount of the
related Servicing Fees payable to the Servicer on such Distribution Date with
respect to the related Mortgage Loans. The Servicer shall not have the right
to
reimbursement for any amounts remitted to the Securities Administrator in
respect of this Section 3.23. The Servicer shall not be obligated to pay the
amounts set forth in this Section 3.23 with respect to shortfalls resulting
from
the application of the Relief Act.
SECTION
3.24. Obligations
of the Servicer in Respect of Mortgage Rates and Monthly Payments.
In
the
event that a shortfall in any collection on or liability with respect to any
Mortgage Loan results from or is attributable to adjustments to Mortgage Rates,
Monthly Payments or Stated Principal Balances that were made by the Servicer
in
a manner not consistent with the terms of the related Mortgage Note and this
Agreement, the Servicer, upon discovery or receipt of notice thereof,
immediately shall deliver to the Securities Administrator for deposit in the
Distribution Account from its own funds the amount of any such shortfall and
shall indemnify and hold harmless the Trust Fund, the Trustee, the Securities
Administrator, the Master Servicer, the Depositor and any successor servicer
in
respect of any such liability. Such indemnities shall survive the termination
or
discharge of this Agreement. Notwithstanding the foregoing, this Section 3.24
shall not limit the ability of the Servicer to seek recovery of any such amounts
from the related Mortgagor under the terms of the related Mortgage Note and
Mortgage, to the extent permitted by applicable law.
SECTION
3.25. Reserve
Fund.
(a) No
later
than the Closing Date, the Securities Administrator shall establish and maintain
a separate, segregated trust account entitled, “Reserve Fund, Xxxxx Fargo Bank,
National Association, in trust for the registered holders of ACE Securities
Corp. Home Equity Loan Trust, Series 2007-WM2, Asset Backed Pass-Through
Certificates.” On the Closing Date, the Depositor will deposit, or cause to be
deposited, into the Reserve Fund $1,000. In addition, the amount deposited
in
the Reserve Fund shall be increased by any payments received by the Securities
Administrator under the Group I Cap Contract and deposited into the Reserve
Fund
for the benefit of the Class A-1 Certificates and the Mezzanine Certificates
and
under the Group II Cap Contract and deposited in the Reserve Fund for the
benefit of the Class A-2 Certificates and the Mezzanine
Certificates.
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(b) On
each
Distribution Date, the Securities Administrator shall deposit into the Reserve
Fund the amounts described in Section 5.01(c)(8)(vi), rather than distributing
such amounts to the Class CE Certificateholders pursuant to Section
5.01(c)(8)(viii). On each such Distribution Date, the Securities Administrator
shall hold all such amounts for the benefit of the Holders of the Class A
Certificates and the Mezzanine Certificates and will distribute such amounts
to
the Holders of the Class A Certificates and the Mezzanine Certificates, in
the
amounts and priorities set forth in Section 5.01(c). If no Net WAC Rate
Carryover Amounts are payable on a Distribution Date, the Securities
Administrator shall deposit, into the Reserve Fund on behalf of the Class CE
Certificateholders, from amounts otherwise distributable to the Class CE
Certificateholders, an amount such that when added to other amounts already
on
deposit in the Reserve Fund, the aggregate amount on deposit therein is equal
to
$1,000.
(c) The
Reserve Fund constitutes an “outside reserve fund” within the meaning of
Treasury Regulation § 1.860G-2(h) and is not an asset of any REMIC. It is the
intention of the parties hereto that, for federal and state income and state
and
local franchise tax purposes, the Reserve Fund be disregarded as an entity
separate from the Holder of the Class CE Certificates unless and until the
date
when either (a) there is more than one Class CE Certificateholder or (b) any
Class of Certificates in addition to the Class CE Certificates is
recharacterized as an equity interest in the Reserve Fund for federal income
tax
purposes, in which case it is the intention of the parties hereto that, for
federal and state income and state and local franchise tax purposes, the Reserve
Fund be treated as a partnership. The Master Servicer shall not be required
to
prepare and file partnership tax returns in respect of such partnership unless
it receives additional reasonable compensation (not to exceed $10,000 per year)
for the preparation of such filings, written notification recognizing the
creation of a partnership agreement or comparable documentation evidencing
the
partnership. All amounts deposited into the Reserve Fund (other than the initial
deposit therein of $1,000 and any amounts paid to the Reserve Fund from the
Cap
Contracts) shall be treated as amounts distributed by REMIC III to the Holders
of the Class CE Certificates. Upon the termination of the Trust Fund, or the
payment in full of the Class A Certificates and the Mezzanine Certificates,
all
amounts remaining on deposit in the Reserve Fund will be released by the Trust
Fund and distributed to the Class CE Certificateholders or their designees.
The
Reserve Fund will be part of the Trust Fund but not part of any REMIC and any
payments to the Holders of the Class A Certificates or the Mezzanine
Certificates of Net WAC Rate Carryover Amounts will not be payments with respect
to a “regular interest” in a REMIC within the meaning of Code Section
860(G)(a)(1).
(d) By
accepting a Class CE Certificate, each Class CE Certificateholder hereby agrees
that the Securities Administrator will deposit into the Reserve Fund the amounts
described above on each Distribution Date rather than distributing such amounts
to the Class CE Certificateholders. By accepting a Class CE Certificate, each
Class CE Certificateholder further agrees that its agreement to such action
by
the Securities Administrator is given for good and valuable consideration,
the
receipt and sufficiency of which is acknowledged by such
acceptance.
130
(e) At
the
direction of the Holders of a majority in Percentage Interest in the Class
CE
Certificates, the Securities Administrator shall direct any Depository
Institution maintaining the Reserve Fund to invest the funds in such account
in
one or more Permitted Investments bearing interest or sold at a discount, and
maturing, unless payable on demand, (i) no later than the Business Day
immediately preceding the date on which such funds are required to be withdrawn
from such account pursuant to this Agreement, if a Person other than the
Securities Administrator or an Affiliate manages or advises such investment,
and
(ii) no later than the date on which such funds are required to be withdrawn
from such account pursuant to this Agreement, if the Securities Administrator
or
an Affiliate manages or advises such investment. All income and gain earned
upon
such investment shall be deposited into the Reserve Fund. In no event shall
the
Securities Administrator be liable for any investments made pursuant to this
clause (e). If the Holders of a majority in Percentage Interest in the Class
CE
Certificates fail to provide investment instructions, funds on deposit in the
Reserve Fund shall be held uninvested by the Securities Administrator without
liability for interest or compensation.
(f) For
federal tax return and information reporting, the right of the Class A
Certificateholders and the Mezzanine Certificateholders to receive payments
from
the Reserve Fund and the Supplemental Interest Trust in respect of any Net
WAC
Rate Carryover Amount shall be assigned a value of $146,000.
(g) In
the
event that a Cap Contract is terminated prior to the Distribution Date in
September 2007, the Securities Administrator, at the direction of the Depositor,
shall use reasonable efforts to appoint a successor cap counterparty using
any
cap agreement termination payments paid by the Cap Counterparty. If the
Securities Administrator is unable to locate a qualified successor cap
counterparty within thirty (30) days of the Early Termination Date (as defined
in the Cap Contract), any cap agreement termination payments paid by the Cap
Counterparty will be deposited into a separate non-interest bearing Eligible
Account and the Securities Administrator, on each subsequent Distribution Date
(until the termination date of the Cap Contract or the appointment of a
successor cap counterparty), will withdraw from the amount then remaining on
deposit in such reserve account an amount equal to the payment, if any, that
would have been paid to the Securities Administrator by the original Cap
Counterparty calculated in accordance with the terms of the original Cap
Contract, and distribute such amount to the holders of the Certificates in
accordance with Section 5.01.
(h) In
the
event that the Cap Counterparty fails to perform any of its obligations under
a
Cap Contract (including, without limitation, its obligation to make any payment
or transfer collateral), or breaches any of its representations and warranties
thereunder, or in the event that an Event of Default, Termination Event, or
Additional Termination Event (each as defined in the Cap Contract) occurs with
respect to the related Cap Contract, the Securities Administrator shall
immediately, but no later than the next Business Day following such failure
or
breach, notify the Depositor and send any notices and make any demands, on
behalf of the Holders of the Offered Certificates, in accordance with the Cap
Contract.
(i) In
the
event that the Cap Counterparty’s obligations are guaranteed by a third party
under a guaranty relating to a Cap Contract (such guaranty the “Guaranty” and
such third party the “Guarantor”), then to the extent that the Cap Counterparty
fails to make any payment by the close of business on the day it is required
to
make payment under the terms of the Cap Contract, the Securities Administrator
shall, as soon as practicable, but no later than two (2) business days after
the
Swap Provider’s failure to pay, demand that the Guarantor make any and all
payments then required to be made by the Guarantor pursuant to such Guaranty;
provided, that the Securities Administrator shall in no event be liable for
any
failure or delay in the performance by the Cap Counterparty or any Guarantor
of
its obligations hereunder or pursuant to the Cap Contract and the Guaranty,
nor
for any special, indirect or consequential loss or damage of any kind whatsoever
(including but not limited to lost profits) in connection
therewith.
131
SECTION
3.26. Advance
Facility.
(a) Notwithstanding
anything to the contrary contained herein, (i) the Servicer is hereby authorized
to enter into an advance facility (“Advance Facility”) but no more than two
Advance Facilities without the prior written consent of the Trustee, which
consent shall not be unreasonably withheld, under which (A) the Servicer sells,
assigns or pledges to an advancing person (an “Advance Financing Person”) its
rights under this Agreement to be reimbursed for any P&I Advances or
Servicing Advances and/or (B) an Advance Financing Person agrees to finance
some
or all P&I Advances or Servicing Advances required to be made by the
Servicer pursuant to this Agreement and (ii) the Servicer is hereby authorized
to assign its rights to the Servicing Fee (which rights shall terminate upon
the
resignation, termination or removal of the Servicer pursuant to the terms of
this Agreement) or pledge its servicing rights; it being understood that neither
the Trust Fund nor any party hereto shall have a right or claim (including
without limitation any right of offset) to any amounts for reimbursement of
P&I Advances or Servicing Advances so assigned or to the portion of the
Servicing Fee so assigned or the servicing rights so pledged. Subject to the
provisions of the first sentence of this Section 3.26(a), no consent of the
Depositor, Trustee, Master Servicer, Certificateholders or any other party
is
required before the Servicer may enter into an Advance Facility, but the
Servicer shall provide notice to the Depositor, Master Servicer and the Trustee
of the existence of any such Advance Facility promptly upon the consummation
thereof stating (a) the identity of the Advance Financing Person and (b) the
identity of any Person (“Servicer’s Assignee”) who has the right to receive
amounts in reimbursement of previously xxxxxxxxxxxx X&X Advances or
Servicing Advances. Notwithstanding the existence of any Advance Facility under
which an advancing person agrees to finance P&I Advances and/or Servicing
Advances on the Servicer’s behalf, the Servicer shall remain obligated pursuant
to this Agreement to make P&I Advances and Servicing Advances pursuant to
and as required by this Agreement, and shall not be relieved of such obligations
by virtue of such Advance Facility.
(b) Reimbursement
amounts (“Advance Reimbursement Amounts”) shall consist solely of amounts in
respect of P&I Advances and/or Servicing Advances made with respect to the
related Mortgage Loans for which the Servicer would be permitted to reimburse
itself in accordance with this Agreement, assuming the Servicer had made the
related P&I Advance(s) and/or Servicing Advance(s).
(c) The
Servicer shall maintain and provide to any successor Servicer (with, upon
request, a copy to the Trustee) a detailed accounting on a loan-by-loan basis
as
to amounts advanced by, pledged or assigned to, and reimbursed to any Advance
Financing Person. The successor Servicer shall be entitled to rely on any such
information provided by the predecessor Servicer, and the successor Servicer
shall not be liable for any errors in such information.
132
(d) Reimbursement
amounts distributed with respect to each Mortgage Loan shall be allocated to
outstanding xxxxxxxxxxxx X&X Advances or Servicing Advances (as the case may
be) made with respect to that Mortgage Loan on a “first-in, first out” (FIFO)
basis. The documentation establishing any Advance Facility shall require the
Servicer to provide to the related Advance Financing Person or its designee
loan-by-loan information with respect to each such reimbursement amount
distributed to such Advance Financing Person or Advance Facility trustee on
each
Distribution Date, to enable the Advance Financing Person or Advance Facility
trustee to make the FIFO allocation of each such reimbursement amount with
respect to each Mortgage Loan. The Servicer shall remain entitled to be
reimbursed by the Advance Financing Person or Advance Facility trustee for
all
P&I Advances and Servicing Advances funded by the Servicer to the extent the
related rights to be reimbursed therefor have not been sold, assigned or pledged
to an Advance Financing Person.
(e) Any
amendment to this Section 3.26 or to any other provision of this Agreement
that
may be necessary or appropriate to effect the terms of an Advance Facility
as
described generally in this Section 3.26, including amendments to add provisions
relating to a successor Servicer, may be entered into by the Trustee, the
Depositor, and the Servicer without the consent of any Certificateholder,
notwithstanding anything to the contrary in this Agreement, provided, that
the
Trustee has been provided an Opinion of Counsel that such amendment is
authorized hereunder and has no material adverse effect on the
Certificateholders, which opinion shall be an expense of the party requesting
such opinion but in any case shall not be an expense of the Trustee or the
Trust
Fund; provided, further, that the amendment shall not be deemed to adversely
affect in any material respect the interests of the Certificateholders if the
Person requesting the amendment obtains a letter from each Rating Agency
(instead of obtaining an Opinion of Counsel to such effect) stating that the
amendment would not result in the downgrading or withdrawal of the respective
ratings then assigned to the Certificates; it being understood and agreed that
any such rating letter in and of itself will not represent a determination
as to
the materiality of any such amendment and will represent a determination only
as
to the credit issues affecting any such rating. Prior to entering into an
Advance Facility, the Servicer shall notify the lender under such facility
in
writing that: (a) the P&I Advances and/or Servicing Advances financed by
and/or pledged to the lender are obligations owed to the Servicer on a
non-recourse basis payable only from the cash flows and proceeds received under
this Agreement for reimbursement of P&I Advances and/or Servicing Advances
only to the extent provided herein, and neither the Master Servicer, the
Securities Administrator, the Trustee nor the Trust are otherwise obligated
or
liable to repay any P&I Advances and/or Servicing Advances financed by the
lender; (b) the Servicer will be responsible for remitting to the lender the
applicable amounts collected by it as Servicing Fees and as reimbursement for
P&I Advances and/or Servicing Advances funded by the lender, as applicable,
subject to the restrictions and priorities created in this Agreement; and (c)
neither the Master Servicer, the Securities Administrator nor the Trustee shall
have any responsibility to calculate any amount payable under an Advance
Facility or to track or monitor the administration of the financing arrangement
between the Servicer and the lender or the payment of any amount under an
Advance Facility.
133
(f) The
Servicer shall indemnify the Master Servicer, the Securities Administrator,
the
Trustee and the Trust Fund for any cost, liability or expense relating to the
Advance Facility including, without limitation, a claim, pending or threatened,
by an Advance Financing Person.
SECTION
3.27. Indemnification.
The
Servicer agrees to indemnify the Trustee, Master Servicer and the Securities
Administrator, from, and hold the Trustee, Master Servicer and the Securities
Administrator harmless against, any loss, liability or expense (including
reasonable attorney’s fees and expenses) incurred by any such Person by reason
of the Servicer’s willful misfeasance, bad faith or gross negligence in the
performance of its duties under this Agreement or by reason of the Servicer’s
reckless disregard of its obligations and duties under this Agreement. Such
indemnity shall survive the termination or discharge of this Agreement and
the
resignation or removal of the Servicer, the Trustee, the Master Servicer and
the
Securities Administrator. Any payment hereunder made by the Servicer to any
such
Person shall be from the Servicer’s own funds, without reimbursement from REMIC
I therefor.
134
ARTICLE
IV
ADMINISTRATION
AND MASTER SERVICING
OF
THE
MORTGAGE LOANS BY THE MASTER SERVICER
SECTION
4.01. Master
Servicer.
The
Master Servicer shall, from and after the Closing Date supervise, monitor and
oversee the obligations of the Servicer under this Agreement to service and
administer the Mortgage Loans in accordance with the terms of this Agreement
and
shall have full power and authority to do any and all things which it may deem
necessary or desirable in connection with such master servicing and
administration. In performing its obligations hereunder, the Master Servicer
shall act in a manner consistent with Accepted Master Servicing Practices.
Furthermore, the Master Servicer shall oversee and consult with the Servicer
as
necessary from time-to-time to carry out the Master Servicer’s obligations
hereunder, shall receive, review and evaluate all reports, information and
other
data provided to the Master Servicer by the Servicer and shall cause the
Servicer to perform and observe the covenants, obligations and conditions to
be
performed or observed by the Servicer under this Agreement. The Master Servicer
shall independently and separately monitor the Servicer’s servicing activities
with respect to each Mortgage Loan, reconcile the results of such monitoring
with such information provided in the previous sentence on a monthly basis
and
coordinate corrective adjustments to the Servicer’s and Master Servicer’s
records, and based on such reconciled and corrected information, prepare the
statements specified in Section 5.03 and any other information and statements
required to be provided by the Master Servicer hereunder. The Master Servicer
shall reconcile the results of its Mortgage Loan monitoring with the actual
remittances of the Servicer to the Distribution Account pursuant to the terms
hereof based on information provided to the Master Servicer by the
Servicer.
The
Trustee shall furnish the Servicer and the Master Servicer with any limited
powers of attorney and other documents in form acceptable to it necessary or
appropriate to enable the Servicer and the Master Servicer to service and
administer the Mortgage Loans and REO Properties. The Trustee shall have no
responsibility for any action of the Master Servicer or the Servicer pursuant
to
any such limited power of attorney and shall be indemnified by the Master
Servicer or the Servicer, as applicable, for any cost, liability or expense
incurred by the Trustee in connection with such Person’s misuse of any such
power of attorney.
The
Trustee, the Custodian and the Securities Administrator shall provide access
to
the records and documentation in possession of the Trustee, the Custodian or
the
Securities Administrator regarding the Mortgage Loans and REO Property and
the
servicing thereof to the Certificateholders, the FDIC, and the supervisory
agents and examiners of the FDIC, such access being afforded only upon
reasonable prior written request and during normal business hours at the office
of the Trustee, the Custodian or the Securities Administrator; provided,
however, that, unless otherwise required by law, none of the Trustee, the
Custodian or the Securities Administrator shall be required to provide access
to
such records and documentation if the provision thereof would violate the legal
right to privacy of any Mortgagor. The Trustee, the Custodian and the Securities
Administrator shall allow representatives of the above entities to photocopy
any
of the records and documentation and shall provide equipment for that purpose
at
a charge that covers the Trustee’s, the Custodian’s or the Securities
Administrator’s actual costs.
135
The
Trustee shall execute and deliver to the Servicer or the Master Servicer upon
request any court pleadings, requests for trustee’s sale or other documents
necessary or desirable to (i) the foreclosure or trustee’s sale with respect to
a Mortgaged Property; (ii) any legal action brought to obtain judgment against
any Mortgagor on the Mortgage Note or any other Mortgage Loan Document; (iii)
obtain a deficiency judgment against the Mortgagor; or (iv) enforce any other
rights or remedies provided by the Mortgage Note or any other Mortgage Loan
Document or otherwise available at law or equity.
SECTION
4.02. REMIC-Related
Covenants.
For
as
long as each REMIC shall exist, the Trustee and the Securities Administrator
shall act in accordance herewith to treat such REMIC as a REMIC, and the Trustee
and the Securities Administrator shall comply with any directions of the
Sponsor, the Servicer or the Master Servicer to assure such continuing
treatment. In particular, the Trustee shall not (a) sell or permit the sale
of
all or any portion of the Mortgage Loans or of any investment of deposits in
an
Account unless such sale is as a result of a repurchase of the Mortgage Loans
pursuant to this Agreement or the Trustee has received a REMIC Opinion prepared
at the expense of the Trust Fund; and (b) other than with respect to a
substitution pursuant to the Mortgage Loan Purchase Agreement or Section 2.03
of
this Agreement, as applicable, accept any contribution to any REMIC after the
Startup Day without receipt of an Opinion of Counsel stating that such
contribution will not result in an Adverse REMIC Event as defined in Section
11.01(f).
SECTION
4.03. Monitoring
of Servicer.
(a) The
Master Servicer shall be responsible for monitoring the compliance by the
Servicer with its duties under this Agreement. In the review of the Servicer’s
activities, the Master Servicer may rely upon an Officer’s Certificate of the
Servicer with regard to the Servicer’s compliance with the terms of this
Agreement. In the event that the Master Servicer, in its judgment, determines
that the Servicer should be terminated in accordance with the terms hereof
or
that a notice should be sent pursuant to the terms hereof with respect to the
occurrence of an event that, unless cured, would constitute a Servicer Event
of
Default, the Master Servicer shall notify the Servicer, the Sponsor and the
Trustee thereof and the Master Servicer shall issue such notice or take such
other action as it deems appropriate.
(b) The
Master Servicer, for the benefit of the Trustee and the Certificateholders,
shall enforce the obligations of the Servicer under this Agreement and shall,
in
the event that the Servicer fails to perform its obligations in accordance
with
this Agreement, subject to this Section and Article VIII, notify the Trustee
and
the Trustee shall terminate the rights and obligations of the Servicer hereunder
in accordance with the provisions of Article VIII. In the event the rights
and
obligations of the Servicer (or any successor thereto) are terminated, the
Master Servicer shall act as servicer of the Mortgage Loans or a successor
servicer shall be appointed in accordance with the provisions of Article VIII.
Such enforcement, including, without limitation, the legal prosecution of claims
and the pursuit of other appropriate remedies, shall be in such form and carried
out to such an extent and at such time as the Master Servicer, in its good
faith
business judgment, would require were it the owner of the Mortgage Loans. The
Master Servicer shall pay the costs of such enforcement at its own expense,
provided that the Master Servicer shall not be required to prosecute or defend
any legal action except to the extent that the Master Servicer shall have
received reasonable indemnity for its costs and expenses in pursuing such
action.
136
(c) The
Master Servicer shall be entitled to be reimbursed by the Servicer (or from
amounts on deposit in the Distribution Account if the Servicer is unable to
fulfill its obligations hereunder) for all reasonable out-of-pocket or third
party costs associated with the transfer of servicing from the predecessor
Servicer (or if the predecessor Servicer is the Master Servicer, from the
Servicer immediately preceding the Master Servicer), including without
limitation, any reasonable out-of-pocket or third party costs or expenses
associated with the complete transfer of all servicing data and the completion,
correction or manipulation of such servicing data as may be required by the
successor servicer to correct any errors or insufficiencies in the servicing
data or otherwise to enable the successor servicer to service the Mortgage
Loans
properly and effectively, upon presentation of reasonable documentation of
such
costs and expenses.
(d) The
Master Servicer shall require the Servicer to comply with the remittance
requirements and other obligations set forth in this Agreement.
(e) If
the
Master Servicer acts as a successor to the Servicer, it will not assume any
liability for the representations and warranties of the terminated
Servicer.
SECTION
4.04. Fidelity
Bond.
The
Master Servicer, at its expense, shall maintain in effect a blanket fidelity
bond and an errors and omissions insurance policy, affording coverage with
respect to all directors, officers, employees and other Persons acting on such
Master Servicer’s behalf, and covering errors and omissions in the performance
of the Master Servicer’s obligations hereunder. The errors and omissions
insurance policy and the fidelity bond shall be in such form and amount
generally acceptable for entities serving as master servicers or
trustees.
SECTION
4.05. Power
to
Act; Procedures.
The
Master Servicer shall master service the Mortgage Loans and shall have full
power and authority, subject to the REMIC Provisions and the provisions of
Article XI, to do any and all things that it may deem necessary or desirable
in
connection with the master servicing and administration of the Mortgage Loans,
including but not limited to the power and authority (i) to execute and deliver,
on behalf of the Certificateholders and the Trustee, customary consents or
waivers and other instruments and documents, (ii) to consent to transfers of
any
Mortgaged Property and assumptions of the Mortgage Notes and related Mortgages,
(iii) to collect any Insurance Proceeds and Liquidation Proceeds, and (iv)
to
effectuate foreclosure or other conversion of the ownership of the Mortgaged
Property securing any Mortgage Loan, in each case, in accordance with the
provisions of this Agreement; provided, however, that the Master Servicer shall
not (and, consistent with its responsibilities under Section 4.03, shall not
permit the Servicer to) knowingly or intentionally 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, would cause REMIC I,
REMIC II or REMIC III to fail to qualify as a REMIC or result in the imposition
of a tax upon the Trust Fund (including but not limited to the tax on prohibited
transactions as defined in Section 860F(a)(2) of the Code and the tax on
contributions to a REMIC set forth in Section 860G(d) of the Code) unless the
Master Servicer has received an Opinion of Counsel (but not at the expense
of
the Master Servicer) to the effect that the contemplated action will not cause
REMIC I, REMIC II or REMIC III to fail to qualify as a REMIC or result in the
imposition of a tax upon REMIC I, REMIC II or REMIC III, as the case may be.
The
Trustee shall furnish the Master Servicer, upon written request from a Servicing
Officer, with any powers of attorney prepared and delivered to it and reasonably
acceptable to it by empowering the Master Servicer or the Servicer to execute
and deliver instruments of satisfaction or cancellation, or of partial or full
release or discharge, and to foreclose upon or otherwise liquidate Mortgaged
Property, and to appeal, prosecute or defend in any court action relating to
the
Mortgage Loans or the Mortgaged Property, in accordance with this Agreement,
and
the Trustee shall execute and deliver such other documents prepared and
delivered to it and reasonably acceptable to it, as the Master Servicer or
the
Servicer may request, to enable the Master Servicer to master service and
administer the Mortgage Loans and carry out its duties hereunder, in each case
in accordance with Accepted Master Servicing Practices (and the Trustee shall
have no liability for misuse of any such powers of attorney by the Master
Servicer or the Servicer and shall be indemnified by the Master Servicer or
the
Servicer, as applicable, for any cost, liability or expense incurred by the
Trustee in connection with such Person’s use or misuse of any such power of
attorney). If the Master Servicer or the Trustee has been advised that it is
likely that the laws of the state in which action is to be taken prohibit such
action if taken in the name of the Trustee or that the Trustee would be
adversely affected under the “doing business” or tax laws of such state if such
action is taken in its name, the Master Servicer shall join with the Trustee
in
the appointment of a co-trustee pursuant to Section 9.10. In the performance
of
its duties hereunder, the Master Servicer shall be an independent contractor
and
shall not, except in those instances where it is taking action in the name
of
the Trustee, be deemed to be the agent of the Trustee.
137
SECTION
4.06. Due-on-Sale
Clauses; Assumption Agreements.
To
the
extent Mortgage Loans contain enforceable due-on-sale clauses, the Master
Servicer shall cause the Servicer to enforce such clauses in accordance with
this Agreement. If applicable law prohibits the enforcement of a due-on-sale
clause or such clause is otherwise not enforced in accordance with this
Agreement and, as a consequence, a Mortgage Loan is assumed, the original
Mortgagor may be released from liability in accordance with this
Agreement.
SECTION
4.07. Documents,
Records and Funds in Possession of Master Servicer To Be Held for
Trustee.
(a) The
Master Servicer shall transmit to the Trustee or the Custodian such documents
and instruments coming into the possession of the Master Servicer from time
to
time as are required by the terms hereof to be delivered to the Trustee or
the
Custodian. Any funds received by the Master Servicer in respect of any Mortgage
Loan or which otherwise are collected by the Master Servicer as Liquidation
Proceeds or Insurance Proceeds in respect of any Mortgage Loan shall be remitted
to the Securities Administrator for deposit in the Distribution Account. The
Master Servicer shall, and, subject to Section 3.21 of this Agreement, shall
cause the Servicer to, provide access to information and documentation regarding
the Mortgage Loans to the Trustee, its agents and accountants at any time upon
reasonable request and during normal business hours, and to Certificateholders
that are savings and loan associations, banks or insurance companies, the Office
of Thrift Supervision, the FDIC and the supervisory agents and examiners of
such
Office and Corporation or examiners of any other federal or state banking or
insurance regulatory authority if so required by applicable regulations of
the
Office of Thrift Supervision or other regulatory authority, such access to
be
afforded without charge but only upon reasonable request in writing and during
normal business hours at the offices of the Master Servicer designated by it.
In
fulfilling such a request the Master Servicer shall not be responsible for
determining the sufficiency of such information.
138
(b) All
Mortgage Files and funds collected or held by, or under the control of, the
Master Servicer, in respect of any Mortgage Loans, whether from the collection
of principal and interest payments or from Liquidation Proceeds or Insurance
Proceeds, shall be remitted to the Securities Administrator for deposit in
the
Distribution Account.
SECTION
4.08. Standard
Hazard Insurance and Flood Insurance Policies.
For
each
Mortgage Loan, the Master Servicer shall enforce the obligation of the Servicer
under this Agreement to maintain or cause to be maintained standard fire and
casualty insurance and, where applicable, flood insurance, all in accordance
with the provisions of this Agreement. It is understood and agreed that such
insurance shall be with insurers meeting the eligibility requirements set forth
in Section 3.11 of this Agreement and that no earthquake or other additional
insurance is to be required of any Mortgagor or to be maintained on property
acquired in respect of a defaulted loan, other than pursuant to such applicable
laws and regulations as shall at any time be in force and as shall require
such
additional insurance.
SECTION
4.09. Presentment
of Claims and Collection of Proceeds.
The
Master Servicer shall enforce the Servicer’s obligations under this Agreement to
prepare and present on behalf of the Trustee and the Certificateholders all
claims under any insurance policies and take such actions (including the
negotiation, settlement, compromise or enforcement of the insured’s claim) as
shall be necessary to realize recovery under such policies. Any proceeds
disbursed to the Master Servicer (or disbursed to the Servicer and remitted
to
the Master Servicer) in respect of such policies, bonds or contracts shall
be
promptly deposited in the Distribution Account upon receipt, except that any
amounts realized that are to be applied to the repair or restoration of the
related Mortgaged Property as a condition precedent to the presentation of
claims on the related Mortgage Loan to the insurer under any applicable
insurance policy need not be so deposited or remitted.
SECTION
4.10. Maintenance
of Primary Mortgage Insurance Policies.
(a) The
Master Servicer shall not take, or permit the Servicer to take (to the extent
such action is prohibited by this Agreement), any action that would result
in
noncoverage under any primary mortgage insurance policy of any loss which,
but
for the actions of the Master Servicer or the Servicer, as applicable, would
have been covered thereunder. The Master Servicer shall use its best reasonable
efforts to cause the Servicer to keep in force and effect (to the extent that
the Mortgage Loan requires the Mortgagor to maintain such insurance), primary
mortgage insurance applicable to each Mortgage Loan in accordance with the
provisions of this Agreement. The Master Servicer shall not, and shall not
permit the Servicer to, cancel or refuse to renew any primary mortgage insurance
policy that is in effect at the date of the initial issuance of the Mortgage
Note and is required to be kept in force hereunder except in accordance with
the
provisions of this Agreement.
139
(b) The
Master Servicer agrees to cause the Servicer to present, on behalf of the
Trustee and the Certificateholders, claims to the insurer under any primary
mortgage insurance policies and, in this regard, to take such reasonable action
as shall be necessary to permit recovery under any primary mortgage insurance
policies respecting defaulted Mortgage Loans.
SECTION
4.11. Trustee
to Retain Possession of Certain Insurance Policies and Documents.
The
Trustee or the Custodian, shall retain possession and custody of the originals
(to the extent available) of any primary mortgage insurance policies, or
certificate of insurance if applicable, and any certificates of renewal as
to
the foregoing as may be issued from time to time as contemplated by this
Agreement. Until all amounts distributable in respect of the Certificates have
been distributed in full and the Master Servicer and the Servicer have otherwise
fulfilled their respective obligations under this Agreement the Trustee or
the
Custodian shall also retain possession and custody of each Mortgage File in
accordance with and subject to the terms and conditions of this Agreement and
the Custodial Agreement. The Master Servicer shall promptly deliver or cause
to
be delivered to the Trustee or the Custodian, upon the execution or receipt
thereof the originals of any primary mortgage insurance policies, any
certificates of renewal, and such other documents or instruments that constitute
Mortgage Loan Documents that come into the possession of the Master Servicer
from time to time.
SECTION
4.12. Realization
Upon Defaulted Mortgage Loans.
The
Master Servicer shall cause the Servicer to foreclose upon, repossess or
otherwise comparably convert the ownership of Mortgaged Properties securing
such
of the Mortgage Loans as come into and continue in default and as to which
no
satisfactory arrangements can be made for collection of delinquent payments,
all
in accordance with this Agreement.
SECTION
4.13. Compensation
for the Master Servicer.
As
compensation for the activities of the Master Servicer hereunder, the Master
Servicer shall be entitled to the Master Servicing Fee and the income from
investment of or earnings on the funds from time to time in the Distribution
Account, as provided in Section 3.10. The compensation payable to the Master
Servicer in respect of any Distribution Date shall be reduced in accordance
with
Section 4.19. 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.
140
SECTION
4.14. REO
Property.
(a) In
the
event the Trust Fund acquires ownership of any REO Property in respect of any
Mortgage Loan, the deed or certificate of sale shall be issued to the Trustee,
or to its nominee, on behalf of the related Certificateholders. The Master
Servicer shall cause the Servicer to sell, any REO Property as expeditiously
as
possible and in accordance with the provisions of this Agreement. Further,
the
Master Servicer shall cause the Servicer to sell any REO Property prior to
three
years after the end of the calendar year of its acquisition by REMIC I unless
(i) the Trustee shall have been supplied by the Servicer with an Opinion of
Counsel to the effect that the holding by the Trust Fund of such REO Property
subsequent to such three-year period will not result in the imposition of taxes
on “prohibited transactions” of any REMIC hereunder as defined in section 860F
of the Code or cause any REMIC hereunder to fail to qualify as a REMIC at any
time that any Certificates are outstanding, in which case the Trust Fund may
continue to hold such Mortgaged Property (subject to any conditions contained
in
such Opinion of Counsel) or (ii) the Servicer shall have applied for, prior
to
the expiration of such three-year period, an extension of such three-year period
in the manner contemplated by Section 856(e)(3) of the Code, in which case
the
three-year period shall be extended by the applicable extension period. The
Master Servicer shall cause the Servicer to protect and conserve, such REO
Property in the manner and to the extent required by this Agreement in
accordance with the REMIC Provisions and in a manner that does not result in
a
tax on “net income from foreclosure property” or cause such REO Property to fail
to qualify as “foreclosure property” within the meaning of Section 860G(a)(8) of
the Code.
(b) The
Master Servicer shall cause the Servicer to deposit all funds collected and
received in connection with the operation of any REO Property in the REO
Account.
SECTION
4.15. Master
Servicer Annual Statement of Compliance.
(a) The
Master Servicer and the Securities Administrator shall deliver (or otherwise
make available) (and the Master Servicer and Securities Administrator shall
cause any Additional Servicer or Servicing Function Participant engaged by
it to
deliver) to the Depositor and the Securities Administrator on or before March
15
of each year, commencing in March 2008, an Officer’s Certificate stating, as to
the signer thereof, that (A) a review of such party’s activities during the
preceding calendar year or portion thereof and of such party’s performance under
this Agreement, or such other applicable agreement in the case of an Additional
Servicer or Servicing Function Participant, has been made under such officer’s
supervision and (B) to the best of such officer’s knowledge, based on such
review, such party has fulfilled all its obligations under this Agreement,
or
such other applicable agreement in the case of an Additional Servicer or
Servicing Function Participant, in all material respects throughout such year
or
portion thereof, or, if there has been a failure to fulfill any such obligation
in any material respect, specifying each such failure known to such officer
and
the nature and status thereof.
141
(b) The
Master Servicer shall include all annual statements of compliance received
by it
with its own annual statement of compliance to be submitted to the Securities
Administrator pursuant to this Section 4.15.
(c) In
the
event the Master Servicer, the Securities Administrator or any Servicing
Function Participant engaged by the parties is terminated, assigns its rights
and obligations under, or resigns pursuant to the terms of this Agreement,
or
any applicable agreement in the case of a Servicing Function Participant, as
the
case may be, such party shall provide an Officer’s Certificate pursuant to this
Section 4.15 or to such applicable agreement, as the case may be,
notwithstanding any such termination, assignment or resignation.
(d) Failure
of the Master Servicer to comply timely with this Section 4.15 shall be deemed
a
Master Servicer Event of Default, automatically, without notice and without
any
cure period, and the Trustee may, in addition to whatever rights the Trustee
may
have under this Agreement and at law or in equity or to damages, including
injunctive relief and specific performance, terminate all the rights and
obligations of the Master Servicer under this Agreement and in and to the
Mortgage Loans and the proceeds thereof without compensating the Master Servicer
for the same. This paragraph shall supersede any other provision in this
Agreement or any other agreement to the contrary.
(e) Copies
of
such Master Servicer annual statements of compliance shall be provided to any
Certificateholder upon request, by the Master Servicer or by the 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 Trustee with
such statement or (ii) the Trustee shall be unaware of the Master Servicer’s
failure to provide such statement).
(f) Delivery
under this Section 4.15 of such reports, information and documents to the
Trustee is for informational purposes only, and the Trustee’s receipt of such
shall not constitute constructive notice of any information contained therein
or
determinable from information contained therein, including the Master Servicer’s
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to conclusively rely exclusively on an Officer’s
Certificate).
SECTION
4.16. Master
Servicer Assessments of Compliance.
(a) By
March
15 of each year, commencing in March 2008, the Master Servicer and the
Securities Administrator, each at its own expense, shall furnish, or otherwise
make available, and each such party shall cause any Servicing Function
Participant engaged by it to furnish, each at its own expense, to the Securities
Administrator and the Depositor, a report on an assessment of compliance with
the Relevant Servicing Criteria that contains (A) a statement by such party
of
its responsibility for assessing compliance with the Relevant Servicing
Criteria, (B) a statement that such party used the Relevant Servicing Criteria
to assess compliance with the Relevant Servicing Criteria, (C) such party’s
assessment of compliance with the Relevant Servicing Criteria as of and for
the
fiscal year covered by the Form 10-K required to be filed pursuant to Section
5.06(d), including, if there has been any material instance of noncompliance
with the Relevant Servicing Criteria, a discussion of each such failure and
the
nature and status thereof, and (D) a statement that a registered public
accounting firm has issued an attestation report on such party’s assessment of
compliance with the Relevant Servicing Criteria as of and for such period.
142
(b) No
later
than the end of each fiscal year for the Trust for which a 10-K is required
to
be filed, the Master Servicer shall forward to the Securities Administrator
and
to the Depositor the name of each Servicing Function Participant engaged by
it
and what Relevant Servicing Criteria will be addressed in the report on
assessment of compliance prepared by such Servicing Function Participant
(provided,
however,
that
the Master Servicer need not provide such information to the Securities
Administrator so long as the Master Servicer and the Securities Administer
are
the same Person). When the Master Servicer and the Securities Administrator
(or
any Servicing Function Participant engaged by them) submit their assessments
to
the Securities Administrator, such parties will also at such time include the
assessment (and attestation pursuant to Section 4.17) of each Servicing Function
Participant engaged by it.
(c) Promptly
after receipt of each such report on assessment of compliance, (i) the Depositor
shall review each such report and, if applicable, consult with the Master
Servicer, the Securities Administrator and any Servicing Function Participant
engaged by such parties as to the nature of any material instance of
noncompliance with the Relevant Servicing Criteria by each such party, and
(ii)
the Securities Administrator shall confirm that the assessments, taken as a
whole, address all of the Servicing Criteria and taken individually address
the
Relevant Servicing Criteria for each party as set forth on Exhibit E and notify
the Depositor of any exceptions.
(d) The
Master Servicer shall include all annual reports on assessment of compliance
received by it from the Servicer with its own assessment of compliance to be
submitted to the Securities Administrator pursuant to this Section 4.16.
(e) In
the
event the Master Servicer, the Securities Administrator or any Servicing
Function Participant engaged by the parties is terminated, assigns its rights
and obligations under, or resigns pursuant to the terms of this Agreement,
or
any other applicable agreement in the case of a Servicing Function Participant,
as the case may be, such party shall provide a report on assessment of
compliance pursuant to this Section 4.16 or to such other applicable agreement,
notwithstanding any such termination, assignment or resignation.
(f) Failure
of the Master Servicer to comply timely with this Section 4.16 shall be deemed
a
Master Servicer Event of Default, automatically, without notice and without
any
cure period, and the Trustee may, in addition to whatever rights the Trustee
may
have under this Agreement and at law or in equity or to damages, including
injunctive relief and specific performance, terminate all the rights and
obligations of the Master Servicer under this Agreement and in and to the
Mortgage Loans and the proceeds thereof without compensating the Master Servicer
for the same. This paragraph shall supersede any other provision in this
Agreement or any other agreement to the contrary.
SECTION
4.17. Master
Servicer Attestation Reports.
(a) By
March
15 of each year, commencing in March 2008, the Master Servicer and the
Securities Administrator, each at its own expense, shall cause, and each such
party shall cause any Servicing Function Participant engaged by it to cause,
each at its own expense, a registered public accounting firm (which may also
render other services to the Master Servicer, the Securities Administrator,
or
such other Servicing Function Participants, as the case may be) and that is
a
member of the American Institute of Certified Public Accountants to furnish
an
attestation report to the Securities Administrator and the Depositor, to the
effect that (i) it has obtained a representation regarding certain matters
from
the management of such party, which includes an assertion that such party has
complied with the Relevant Servicing Criteria, and (ii) on the basis of an
examination conducted by such firm in accordance with standards for attestation
engagements issued or adopted by the PCAOB, it is expressing an opinion as
to
whether such party’s compliance with the Relevant Servicing Criteria was fairly
stated in all material respects, or it cannot express an overall opinion
regarding such party’s assessment of compliance with the Relevant Servicing
Criteria. In the event that an overall opinion cannot be expressed, such
registered public accounting firm shall state in such report why it was unable
to express such an opinion. Such report must be available for general use and
not contain restricted use language.
143
(b) Promptly
after receipt of such assessment of compliance and attestation report from
the
Master Servicer, the Securities Administrator or any Servicing Function
Participant engaged by such parties, the Securities Administrator shall confirm
that each assessment submitted pursuant to Section 4.16 is coupled with an
attestation meeting the requirements of this Section and notify the Depositor
of
any exceptions.
(c) The
Master Servicer shall include each such attestation furnished to it from the
Servicer with its own attestation to be submitted to the Securities
Administrator pursuant to this Section 4.17.
(d) In
the
event the Master Servicer, the Securities Administrator or any Servicing
Function Participant engaged by the parties is terminated assigns its rights
and
duties under, or resigns pursuant to the terms of this Agreement, or any
applicable custodial agreement or servicing or sub-servicing agreement in the
case of a Servicing Function Participant, as the case may be, such party shall
cause a registered public accounting firm to provide an attestation pursuant
to
this Section 4.17, or such other applicable agreement, notwithstanding any
such
termination, assignment or resignation.
(e) Failure
of the Master Servicer to comply timely with this Section 4.17 shall be deemed
a
Master Servicer Event of Default, automatically, without notice and without
any
cure period, and the Trustee may, in addition to whatever rights the Trustee
may
have under this Agreement and at law or in equity or to damages, including
injunctive relief and specific performance, terminate all the rights and
obligations of the Master Servicer under this Agreement and in and to the
Mortgage Loans and the proceeds thereof without compensating the Master Servicer
for the same. This paragraph shall supersede any other provision in this
Agreement or any other agreement to the contrary.
SECTION
4.18. Annual
Certification.
(a) Each
Form
10-K required to be filed for the Trust pursuant to Section 5.06 shall include
a
Xxxxxxxx-Xxxxx Certification required to be included therewith pursuant to
the
Xxxxxxxx-Xxxxx Act. Each of the Master Servicer and the Securities Administrator
shall provide, and shall cause any Servicing Function Participant engaged by
it
to provide to the Person who signs the Xxxxxxxx-Xxxxx Certification (the
“Certifying Person”), by March 15 of each year in which the Trust is subject to
the reporting requirements of the Exchange Act and otherwise within a reasonable
period of time upon request, a certification (each, a “Back-Up Certification”),
in the form attached hereto as Exhibit C, upon which the Certifying Person,
the
entity for which the Certifying Person acts as an officer, and such entity’s
officers, directors and Affiliates (collectively with the Certifying Person,
“Certification Parties”) can reasonably rely. The officer of the Master Servicer
in charge of the master servicing function shall serve as the senior Certifying
Person on behalf of the Trust. Such officer of the Certifying Person can be
contacted by e-mail at xxx.xxx.xxxxxxxxxxxxx@xxxxxxxxxx.xxx or by facsimile
at
000-000-0000. In the event any such party or any Servicing Function Participant
engaged by any such party is terminated, assigns its rights or duties under,
or
resigns pursuant to the terms of this Agreement, or any applicable sub-servicing
agreement, as the case may be, such party shall provide a Back-Up Certification
to the Certifying Person pursuant to this Section 4.18 with respect to the
period of time it was subject to this Agreement or any applicable sub-servicing
agreement, as the case may be. Notwithstanding the foregoing, (i) the Master
Servicer and the Securities Administrator shall not be required to deliver
a
Back-Up Certification to each other if both are the same Person and the Master
Servicer is the Certifying Person and (ii) the Master Servicer shall not be
obligated to sign the Xxxxxxxx-Xxxxx Certification in the event that it does
not
receive any Back-Up Certification required to be furnished to it pursuant to
this Section 4.18.
144
SECTION
4.19. Obligation
of the Master Servicer in Respect of Prepayment Interest
Shortfalls.
In
the
event of any Prepayment Interest Shortfalls, the Master Servicer shall deposit
into the Distribution Account not later than the related Distribution Date
an
amount equal to the lesser of (i) the aggregate amounts required to be paid
by
the Servicer with respect to Prepayment Interest Shortfalls attributable to
Principal Prepayments in full on the Mortgage Loans for the related Distribution
Date, and not so paid by the Servicer and (ii) the aggregate amount of the
compensation payable to the Master Servicer for such Distribution Date in
accordance with Section 4.13, without reimbursement therefor.
SECTION
4.20. Prepayment
Penalty Verification.
On
or
prior to each Servicer Remittance Date, the Servicer shall provide in an
electronic format acceptable to the Master Servicer the data necessary for
the
Master Servicer to perform its verification duties set forth in this Section
4.20. The Master Servicer or a third party reasonably acceptable to the Master
Servicer and the Depositor (the “Verification Agent”) will perform such
verification duties and will use its best efforts to issue its findings in
a
report (the “Verification Report”) delivered to the Master Servicer and the
Depositor within ten (10) Business Days following the related Distribution
Date;
provided, however, that if the Verification Agent is unable to issue the
Verification Report within ten (10) Business Days following the Distribution
Date, the Verification Agent may issue and deliver to the Master Servicer and
the Depositor the Verification Report upon the completion of its verification
duties. The Master Servicer shall forward the Verification Report to the
Servicer and shall notify the Servicer if the Master Servicer has determined
that the Servicer did not deliver the appropriate Prepayment Charge to the
Securities Administrator in accordance with this Agreement. Such written
notification from the Master Servicer shall include the loan number, prepayment
penalty code and prepayment penalty amount as calculated by the Master Servicer
or the Verification Agent, as applicable, of each Mortgage Loan for which there
is a discrepancy. If the Servicer agrees with the verified amounts, the Servicer
shall adjust the immediately succeeding Servicer Report and the amount remitted
to the Securities Administrator with respect to prepayments accordingly. If
the
Servicer disagrees with the determination of the Master Servicer, the Servicer
shall, within five (5) Business Days of its receipt of the Verification Report,
notify the Master Servicer of such disagreement and provide the Master Servicer
with detailed information to support its position. The Servicer and the Master
Servicer shall cooperate to resolve any discrepancy on or prior to the
immediately succeeding Servicer Remittance Date, and the Servicer will indicate
the effect of such resolution on the Servicer Report and shall adjust the amount
remitted with respect to prepayments on such Servicer Remittance Date
accordingly.
145
During
such time as the Servicer and the Master Servicer are resolving discrepancies
with respect to the Prepayment Charges, no payments in respect of any disputed
Prepayment Charges will be remitted to the Securities Administrator for deposit
in the Distribution Account and the Master Servicer shall not be obligated
to
deposit such payments, unless otherwise required pursuant to Section 8.01
hereof. In connection with such duties, the Master Servicer shall be able to
rely solely on the information provided to it by the Servicer in accordance
with
this Section. The Master Servicer shall not be responsible for verifying the
accuracy of any of the information provided to it by the Servicer.
146
ARTICLE
V
PAYMENTS
TO CERTIFICATEHOLDERS
SECTION
5.01. Distributions.
(a) On
each
Distribution Date, the following amounts, in the following order of priority,
shall be distributed by REMIC I to REMIC II on account of the REMIC I Regular
Interests and distributed to the holders of the Class R Certificates (in respect
of the Class R-I Interest), as the case may be:
(1) With
respect to the Group I Mortgage Loans:
(i)to
Holders of REMIC I Regular Interest I and REMIC I Regular Interest I-1-A through
I-54-B, pro
rata,
in an
amount equal to (A) Uncertificated Interest for such REMIC I Regular Interests
for such Distribution Date, plus (B) any amounts payable in respect thereof
remaining unpaid from previous Distribution Dates;
(ii)to
the
extent of amounts remaining after the distributions made pursuant to clause
(i)
above, to the Holders of REMIC I Regular Interest I, an amount of principal
shall be distributed to such Holders until the Uncertificated Balance of REMIC
I
Regular Interest I is reduced to zero; and
(iii)to
the
extent of amounts remaining after distributions made pursuant to clauses (i)
and
(ii) above, payments of principal shall be allocated to REMIC I Regular
Interests I-1-A through I-54-B starting with the lowest numerical denomination
until the Uncertificated Balance of each such REMIC I Regular Interest is
reduced to zero, provided that, for REMIC I Regular Interests with the same
numerical denomination, such payments of principal shall be allocated
pro
rata
between
such REMIC I Regular Interests.
(2) With
respect to the Group II Mortgage Loans:
(i)to
Holders of REMIC I Regular Interest II and each of REMIC I Regular Interest
II-1-A through II-54-B, pro
rata,
in an
amount equal to (A) Uncertificated Interest for such REMIC I Regular Interests
for such Distribution Date, plus (B) any amounts payable in respect thereof
remaining unpaid from previous Distribution Dates;
(ii)to
the
extent of amounts remaining after the distributions made pursuant to clause
(i)
above, to the Holders of REMIC I Regular Interest II, an amount of principal
shall be distributed to such Holders until the Uncertificated Balance of REMIC
I
Regular Interest II is reduced to zero; and
(iii)to
the
extent of amounts remaining after distributions made pursuant to clauses (i)
and
(ii) above, payments of principal shall be allocated to REMIC I Regular
Interests II-1-A through II-54-B starting with the lowest numerical denomination
until the Uncertificated Balance of each such REMIC I Regular Interest is
reduced to zero, provided that, for REMIC I Regular Interests with the same
numerical denomination, such payments of principal shall be allocated
pro
rata
between
such REMIC I Regular Interests.
147
(b) to
the
Holders of REMIC I Regular Interest I-54-B, all amounts representing Prepayment
Charges in respect of the Group I Mortgage Loans received during the related
Prepayment Period and to the Holders of REMIC I Regular Interest II-54-B, all
amounts representing Prepayment Charges in respect of the Group II Mortgage
Loans received during the related Prepayment Period.
(c) (1)
On
each Distribution Date, the following amounts, in the following order of
priority, shall be distributed by REMIC II to REMIC III on account of the REMIC
II Regular Interests or withdrawn from the Distribution Account and distributed
to the Holders of the Class R Certificates (in respect of the Class R-II
Interest), as the case may be:
(i) first
to
the Holders of REMIC II Regular Interest IO, in an amount equal to (A)
Uncertificated Interest for such REMIC II Regular Interest for such Distribution
Date, plus (B) any amounts in respect thereof remaining unpaid from previous
Distribution Dates and second, to the Holders of REMIC II Regular Interest
AA,
REMIC II Regular Interest A-1, REMIC II Regular Interest A-2A, REMIC II Regular
Interest A-2B, REMIC II Regular Interest A-2C, REMIC II Regular Interest A-2D,
REMIC II Regular Interest M-1, REMIC II Regular Interest M-2, REMIC II Regular
Interest M-3, REMIC II Regular Interest M-4, REMIC II Regular Interest M-5,
REMIC II Regular Interest M-6, REMIC II Regular Interest M-7, REMIC II Regular
Interest M-8, REMIC II Regular Interest M-9, REMIC II Regular Interest P and
REMIC II Regular Interest ZZ, pro
rata,
in an
amount equal to (A) the Uncertificated Interest for such Distribution Date,
plus
(B) any amounts in respect thereof remaining unpaid from previous Distribution
Dates. Amounts payable as Uncertificated Interest in respect of REMIC II Regular
Interest ZZ shall be reduced when the REMIC II Overcollateralization Amount
is
less than the REMIC II Required Overcollateralization Amount, by the lesser
of
(x) the amount of such difference and (y) the Maximum ZZ Uncertificated Interest
Deferral Amount and such amount will be payable to the Holders of REMIC II
Regular Interest A-1, REMIC II Regular Interest A-2A, REMIC II Regular Interest
A-2B, REMIC II Regular Interest A-2C, REMIC II Regular Interest A-2D, REMIC
II
Regular Interest M-1, REMIC II Regular Interest M-2, REMIC II Regular Interest
M-3, REMIC II Regular Interest M-4, REMIC II Regular Interest M-5, REMIC II
Regular Interest M-6, REMIC II Regular Interest M-7, REMIC II Regular Interest
M-8 and REMIC II Regular Interest M-9 in the same proportion as the
Overcollateralization Increase Amount is allocated to the Corresponding
Certificates and the Uncertificated Balance of REMIC II Regular Interest ZZ
shall be increased by such amount;
(ii) to
Holders of REMIC II Regular Interest I-SUB, REMIC II Regular Interest I-GRP,
REMIC II Regular Interest II-SUB, REMIC II Regular Interest II-GRP, and REMIC
II
Regular Interest XX, pro
rata,
in an
amount equal to (A) the Uncertificated Interest for such Distribution Date,
plus
(B) any amounts in respect thereof remaining unpaid from previous Distribution
Dates;
148
(iii) to
the
Holders of REMIC II Regular Interests, in an amount equal to the remainder
of
the REMIC II Marker Allocation Percentage of the available funds for such
Distribution Date after the distributions made pursuant to clause (i) above,
allocated as follows:
(A) 98.00%
of
such remainder to the Holders of REMIC II Regular Interest AA, until the
Uncertificated Balance of such REMIC II Regular Interest is reduced to
zero;
(B) 2.00%
of
such remainder, first, to the Holders of REMIC II Regular Interest A-1, REMIC
II
Regular Interest A-2A, REMIC II Regular Interest A-2B, REMIC II Regular Interest
A-2C, REMIC II Regular Interest A-2D, REMIC II Regular Interest M-1, REMIC
II
Regular Interest M-2, REMIC II Regular Interest M-3, REMIC II Regular Interest
M-4, REMIC II Regular Interest M-5, REMIC II Regular Interest M-6, REMIC II
Regular Interest M-7, REMIC II Regular Interest M-8 and REMIC II Regular
Interest M-9, 1% of and in the same proportion as principal payments are
allocated to the Corresponding Certificates, until the Uncertificated Balances
of such REMIC II Regular Interests are reduced to zero and second to the Holders
of REMIC II Regular Interest ZZ, until the Uncertificated Balance of such REMIC
II Regular Interest is reduced to zero;
(C) to
the
Holders of REMIC II Regular Interest P, (1) 100% of the Prepayment Charges
deemed distributed on REMIC I Regular Interest I-54-B and REMIC I Regular
Interest II-54-B and (2) on the Distribution Date immediately following the
expiration of the latest Prepayment Charge as identified on the Prepayment
Charge Schedule or any Distribution Date thereafter until $100 has been
distributed pursuant to this clause; then
(D) any
remaining amount to the Holders of the Class R Certificate, in respect of the
Class R-II Interest;
provided,
however, that 98.00% and 2.00% of any principal payments that are attributable
to an Overcollateralization Reduction Amount shall be allocated to Holders
of
REMIC II Regular Interest AA and REMIC II Regular Interest ZZ,
respectively.
(iv) to
the
Holders of REMIC II Regular Interests, in an amount equal to the remainder
of
the REMIC II Sub WAC Allocation Percentage of available funds for such
Distribution Date after the distributions made pursuant to clause (c)(ii) above,
such that distributions of principal shall be deemed to be made to the REMIC
II
Regular Interests first, so as to keep the Uncertificated Balance of each REMIC
II Regular Interest ending with the designation “GRP” equal to 0.01% of the
aggregate Stated Principal Balance of the Mortgage Loans in the related loan
group; second, to each REMIC II Regular Interest ending with the designation
“SUB,” so that the Uncertificated Balance of each such REMIC II Regular Interest
is equal to 0.01% of the excess of (x) the aggregate Stated Principal Balance
of
the Mortgage Loans in the related loan group over (y) the current Certificate
Principal Balance of the Class A Certificate in the related loan group (except
that if any such excess is a larger number than in the preceding distribution
period, the least amount of principal shall be distributed to such REMIC II
Regular Interests such that the REMIC II Subordinated Balance Ratio is
maintained); and third, any remaining principal to REMIC II Regular Interest
XX.
149
(v) Notwithstanding
the distributions described in Section 5.01(c)(1), distributions of funds shall
be made to Certificateholders only in accordance with Section 5.01(c)(2) through
(8) and Section 5.01(e).
(2) On
each
Distribution Date, the Securities Administrator shall withdraw from the
Distribution Account to the extent on deposit therein an amount equal to the
Group I Interest Remittance Amount and make the following disbursements and
transfers in the order of priority described below, in each case to the extent
of the Group I Interest Remittance Amount remaining for such Distribution
Date:
first,
commencing on the Distribution Date in October 2007, to the Supplemental
Interest Trust, an amount equal to (x) the Group I Allocation Percentage of
(i)
any Net Swap Payment owed to the Swap Provider and (ii) any Swap Termination
Payment owed to the Swap Provider not due to a Swap Provider Trigger Event
(to
the extent such amount has not been paid by the Securities Administrator from
any upfront payment received pursuant to any related replacement interest rate
swap agreement that may be entered into by the Trustee on behalf of the
Supplemental Interest Trust) and (y) any Net Swap Payment and Swap Termination
Payment not paid pursuant to clause (x) in first under Section 5.01(c)(3)
below;
second,
to the
Holders of the Class A-1 Certificates, the Senior Interest Distribution Amount
allocable to the Class A-1 Certificates; and
third,
concurrently, to the Holders of the Class A-2A, Class A-2B, Class A-2C and
Class
A-2D Certificates, the Senior Interest Distribution Amount allocable to each
such Class, to the extent remaining unpaid after the distribution of the Group
II Interest Remittance Amount as set forth in Section 5.01(c)(3) below on a
pro rata basis, based on the entitlement of each such Class.
(3) On
each
Distribution Date, the Securities Administrator shall withdraw from the
Distribution Account to the extent on deposit therein an amount equal to the
Group II Interest Remittance Amount and make the following disbursements and
transfers in the order of priority described below, in each case to the extent
of the Group II Interest Remittance Amount remaining for such Distribution
Date:
first,
commencing on the Distribution Date in October 2007, to the Supplemental
Interest Trust, an amount equal to (x) the Group II Allocation Percentage of
(i)
any Net Swap Payment owed to the Swap Provider and (ii) any Swap Termination
Payment owed to the Swap Provider not due to a Swap Provider Trigger Event
(to
the extent such amount has not been paid by the Securities Administrator from
any upfront payment received pursuant to any related replacement interest rate
swap agreement that may be entered into by the Trustee on behalf of the
Supplemental Interest Trust) and (y) any Net Swap Payment and Swap Termination
Payment not paid pursuant to clause (x) in first under Section 5.01(c)(2)
above;
150
second, concurrently,
to the Holders of the Class A-2A, Class A-2B, Class A-2C and Class A-2D
Certificates, the Senior Interest Distribution Amount allocable to each such
Class, on a pro rata basis, based on the entitlement of each such Class;
and
third,
to the
Holders of the Class A-1 Certificates, the Senior Interest Distribution Amount
allocable to the Class A-1 Certificates, to the extent remaining unpaid after
the distribution of the Group I Interest Remittance Amount as set forth in
Section 5.01(c)(2) above.
(4) On
each
Distribution Date, the Securities Administrator shall withdraw from the
Distribution Account to the extent on deposit therein an amount equal to the
Group I Interest Remittance Amount and the Group II Interest Remittance Amount
remaining after the distributions required by clauses (2) and (3) above and
make
the following disbursements and transfers in the order of priority described
below, in each case to the extent of the Group I Interest Remittance Amount
and
Group II Interest Remittance Amount remaining for such Distribution
Date:
sequentially,
to the Holders of the Class M-1, Class M-2, Class M-3, Class M-4, Class M-5,
Class M-6, Class M-7, Class M-8 and Class M-9 Certificates, in that order,
to
the extent of the Interest Distribution Amount allocable to each such
Class.
(5) On
each
Distribution Date (a) prior to the Stepdown Date or (b) on which a Trigger
Event
is in effect, the Securities Administrator shall withdraw from the Distribution
Account to the extent on deposit therein an amount equal to the Group I
Principal Distribution Amount and Group II Principal Distribution Amount and
distribute to the Certificateholders the following amounts, in the following
order of priority:
(i) The
Group
I Principal Distribution Amount shall be distributed in the following order
of
priority:
first,
commencing on the Distribution Date in October 2007, to the Supplemental
Interest Trust, an amount equal to (x) the Group I Allocation Percentage of
(i)
any Net Swap Payment owed to the Swap Provider and (ii) any Swap Termination
Payment owed to the Swap Provider not due to a Swap Provider Trigger Event
to
the extent not paid from the Interest Remittance Amount on such Distribution
Date and (y) any Swap Payment and Swap Termination Payment not paid pursuant
to
clause (x) in first under Section 5.01(c)(5)(ii) below;
second,
to the
Holders of the Class A-1 Certificates, until the Certificate Principal Balance
of the Class A-1 Certificates has been reduced to zero; and
151
third,
sequentially, to the Holders of the Class A-2A, Class A-2B, Class A-2C and
Class
A-2D Certificates, in that order, after taking into account the distribution
of
the Group II Principal Distribution Amount as described in
Section 5.01(c)(5)(ii) below, until the Certificate Principal Balance of
each such Class has been reduced to zero.
(ii) The
Group
II Principal Distribution Amount shall be distributed in the following order
of
priority:
first,
commencing on the Distribution Date in September 2007, to the Supplemental
Interest Trust, an amount equal to (x) the Group II Allocation Percentage of
(i)
any Net Swap Payment owed to the Swap Provider and (ii) any Swap Termination
Payment owed to the Swap Provider not due to a Swap Provider Trigger Event
to
the extent not paid from the Interest Remittance Amount on such Distribution
Date and (y) any Swap Payment and Swap Termination Payment not paid pursuant
to
clause (x) in first under Section 5.01(c)(5)(i) above;
second,
sequentially, to the Holders of the Class A-2A Class A-2B, Class A-2C and Class
A-2D Certificates, in that order, until the Certificate Principal Balance of
each such Class has been reduced to zero; and
third,
to the
Holders of the Class A-1 Certificates after taking into account the distribution
of the Group I Principal Distribution Amount as described in Section
5.01(c)(5)(i) above, until the Certificate Principal Balance of such Class
has
been reduced to zero.
(iii) The
Group
I Principal Distribution Amount and Group II Principal Distribution Amount
remaining after distributions pursuant to Sections 5.01(c)(6)(i) and (ii) above
shall be distributed in the following order of priority:
sequentially,
to the Holders of the Class M-1, Class M-2, Class M-3, Class M-4, Class M-5,
Class M-6, Class M-7, Class M-8 and Class M-9 Certificates, in that order,
until
the Certificate Principal Balance of each such Class has been reduced to
zero.
(6) On
each
Distribution Date (a) on or after the Stepdown Date and (b) on which a Trigger
Event is not in effect, the Securities Administrator shall withdraw from the
Distribution Account to the extent on deposit therein an amount equal to the
Group I Principal Distribution Amount and Group II Principal Distribution Amount
and distribute to the Certificateholders the following amounts, in the following
order of priority:
(i) The
Group
I Principal Distribution Amount shall be distributed in the following order
of
priority:
first,
commencing on the Distribution Date in September 2007, to the Supplemental
Interest Trust, an amount equal to (x) the Group I Allocation Percentage of
(i)
any Net Swap Payment owed to the Swap Provider and (ii) any Swap Termination
Payment owed to the Swap Provider not due to a Swap Provider Trigger Event
to
the extent not paid from the Interest Remittance Amount on such Distribution
Date and (y) any Swap Payment and Swap Termination Payment not paid pursuant
to
clause (x) in first under Section 5.01(c)(6)(ii) below;
152
second,
to the
Holders of the Class A-1 Certificates, the Class A-1 Principal Distribution
Amount, until the Certificate Principal Balance of such Class has been reduced
to zero; and
third,
sequentially, to the Holders of the Class A-2A, Class A-2B, Class A-2C and
Class
A-2D Certificates, in that order, after taking into account the distribution
of
the Group II Principal Distribution Amount pursuant to
Section 5.01(c)(6)(ii) below, up to an amount equal to the amount, if any,
of the Class A-2 Principal Distribution Amount remaining unpaid on such
Distribution Date, until the Certificate Principal Balance of each such Class
has been reduced to zero.
(ii) The
Group
II Principal Distribution Amount shall be distributed in the following order
of
priority:
first,
commencing on the Distribution Date in September 2007, to the Supplemental
Interest Trust, an amount equal to (x) the Group II Allocation Percentage of
(i)
any Net Swap Payment owed to the Swap Provider and (ii) any Swap Termination
Payment owed to the Swap Provider not due to a Swap Provider Trigger Event
to
the extent not paid from the Interest Remittance Amount on such Distribution
Date and (y) any Swap Payment and Swap Termination Payment not paid pursuant
to
clause (x) in first under Section 5.01(c)(6)(i) above;
second,
sequentially, to the Holders of the Class A-2A, Class A-2B, Class A-2C and
Class
A-2D Certificates, in that order, the Class A-2 Principal Distribution Amount,
until the Certificate Principal Balance of each such Class has been reduced
to
zero; and
third,
to the
Holders of the Class A-1 Certificates, after taking into account the
distribution of the Group I Principal Distribution Amount pursuant to Section
5.01(c)(6)(i) above on such Distribution Date, up to an amount equal to the
amount, if any, of the Class A-1 Principal Distribution Amount remaining unpaid
on such Distribution Date, until the Certificate Principal Balance of such
Class
has been reduced to zero.
(iii) The
Principal Distribution Amount remaining after distributions pursuant to Sections
5.01(c)(6)(i) and (ii) above shall be distributed in the following order of
priority:
first,
to the
Holders of the Class M-1 Certificates, the lesser of (x) the remaining Principal
Distribution Amount and (y) the Class M-1 Principal Distribution Amount, until
the Certificate Principal Balance of the Class M-1 Certificates has been reduced
to zero;
153
second,
to the
Holders of the Class M-2 Certificates, the lesser of (x) the excess of (i)
the
remaining Principal Distribution Amount over (ii) the amount distributed to
the
Holders of the Class M-1 Certificates under clause first
above,
and (y) the Class M-2 Principal Distribution Amount, until the Certificate
Principal Balance of the Class M-2 Certificates has been reduced to
zero;
third,
to the
Holders of the Class M-3 Certificates, the lesser of (x) the excess of (i)
the
remaining Principal Distribution Amount over (ii) the sum of the amounts
distributed to the Holders of the Class M-1 Certificates under clause
first
above
and to the Holders of the Class M-2 Certificates under clause second
above,
and (y) the Class M-3 Principal Distribution Amount, until the Certificate
Principal Balance of the Class M-3 Certificates has been reduced to
zero;
fourth,
to the
Holders of the Class M-4 Certificates, the lesser of (x) the excess of (i)
the
remaining Principal Distribution Amount over (ii) the sum of the amounts
distributed to the Holders of the Class M-1 Certificates under clause
first
above,
to the Holders of the Class M-2 Certificates under clause second
above
and to the Holders of the Class M-3 Certificates under clause third
above,
and (y) the Class M-4 Principal Distribution Amount, until the Certificate
Principal Balance of the Class M-4 Certificates has been reduced to zero;
fifth,
to the
Holders of the Class M-5 Certificates, the lesser of (x) the excess of (i)
the
remaining Principal Distribution Amount over (ii) the sum of the amounts
distributed to the Holders of the Class M-1 Certificates under clause
first
above,
to the Holders of the Class M-2 Certificates under clause second
above,
to the Holders of the Class M-3 Certificates under clause third
above
and to the Holders of the Class M-4 Certificates under clause fourth
above,
and (y) the Class M-5 Principal Distribution Amount, until the Certificate
Principal Balance of the Class M-5 Certificates has been reduced to
zero;
sixth,
to the
Holders of the Class M-6 Certificates, the lesser of (x) the excess of (i)
the
remaining Principal Distribution Amount over (ii) the sum of the amounts
distributed to the Holders of the Class M-1 Certificates under clause
first
above,
to the Holders of the Class M-2 Certificates under clause second
above,
to the Holders of the Class M-3 Certificates under clause third
above,
to the Holders of the Class M-4 Certificates under clause fourth
above
and to the Holders of the Class M-5 Certificates under clause fifth
above,
and (y) the Class M-6 Principal Distribution Amount, until the Certificate
Principal Balance of the Class M-6 Certificates has been reduced to zero;
seventh,
to the
Holders of the Class M-7 Certificates, the lesser of (x) the excess of (i)
the
remaining Principal Distribution Amount over (ii) the sum of the amounts
distributed to the Holders of the Class M-1 Certificates under clause
first
above,
to the Holders of the Class M-2 Certificates under clause second
above,
to the Holders of the Class M-3 Certificates under clause third
above,
to the Holders of the Class M-4 Certificates under clause fourth
above,
to the Holders of the Class M-5 Certificates under clause fifth
above
and to the Holders of the Class M-6 Certificates under clause sixth
above,
and (y) the Class M-7 Principal Distribution Amount, until the Certificate
Principal Balance of the Class M-7 Certificates has been reduced to
zero;
154
eighth,
to the
Holders of the Class M-8 Certificates, the lesser of (x) the excess of (i)
the
remaining Principal Distribution Amount over (ii) the sum of the amounts
distributed to the Holders of the Class M-1 Certificates under clause
first
above,
to the Holders of the Class M-2 Certificates under clause second
above,
to the Holders of the Class M-3 Certificates under clause third
above,
to the Holders of the Class M-4 Certificates under clause fourth
above,
to the Holders of the Class M-5 Certificates under clause fifth
above,
to the Holders of the Class M-6 Certificates under clause sixth
above
and to the Holders of the Class M-7 Certificates under clause seventh
above,
and (y) the Class M-8 Principal Distribution Amount, until the Certificate
Principal Balance of the Class M-8 Certificates has been reduced to zero;
and
ninth,
to the
Holders of the Class M-9 Certificates, the lesser of (x) the excess of (i)
the
remaining Principal Distribution Amount over (ii) the sum of the amounts
distributed to the Holders of the Class M-1 Certificates under clause
first
above,
to the Holders of the Class M-2 Certificates under clause second
above,
to the Holders of the Class M-3 Certificates under clause third
above,
to the Holders of the Class M-4 Certificates under clause fourth
above,
to the Holders of the Class M-5 Certificates under clause fifth
above,
to the Holders of the Class M-6 Certificates under clause sixth
above,
to the Holders of the Class M-7 Certificates under clause seventh
above
and to the Holders of the Class M-8 Certificates under clause eighth
above,
and (y) the Class M-9 Principal Distribution Amount, until the Certificate
Principal Balance of the Class M-9 Certificates has been reduced to
zero.
Notwithstanding
the priority of distributions described in this Section 5.01(c) with
respect to the Class A-2A, Class A-2B, Class A-2C and Class A-2D Certificates,
on any Distribution Date which occurs after the Certificate Principal Balances
of the Mezzanine Certificates and Class CE Certificates have been reduced to
zero distributions in respect of principal to the Class A-2A, Class A-2B, Class
A-2C and Class A-2D Certificates will be made on a pro rata basis, based on
the
Certificate Principal Balance of each such Class, until the Certificate
Principal Balance of each such Class has been reduced to zero.
(7) On
each
Distribution Date, the Net Monthly Excess Cashflow (or, in the case of clause
(i) below, the Net Monthly Excess Cashflow exclusive of any
Overcollateralization Reduction Amount) shall be distributed as
follows:
(i) to
the
Holders of the Class or Classes of Certificates then entitled to receive
distributions in respect of principal, in an amount equal to the
Overcollateralization Increase Amount, payable to such Holders, to be paid
as
part of the Principal Distribution Amount;
155
(ii) sequentially,
to the Holders of the Class M-1, Class M-2, Class M-3, Class M-4, Class M-5,
Class M-6, Class M-7, Class M-8 and Class M-9 Certificates, in that order,
in an
amount equal to the Interest Carry Forward Amount allocable to each such
Class;
(iii) sequentially,
to the Holders of the Class M-1, Class M-2, Class M-3, Class M-4, Class M-5,
Class M-6, Class M-7, Class M-8 and Class M-9 Certificates, in that order,
in an
amount equal to the Allocated Realized Loss Amount allocable to each such
Class;
(iv) concurrently,
to the Holders of the Class A Certificates, in an amount equal to such
Certificates’ allocated share of any Prepayment Interest Shortfalls on the
Mortgage Loans to the extent not covered by payments pursuant to Section 3.23
or
4.19 of this Agreement and any shortfalls resulting from the application of
the
Relief Act or similar state or local law or the bankruptcy code with respect
to
the Mortgage Loans to the extent not previously reimbursed pursuant to Section
1.02;
(v) sequentially,
to the Holders of the Class M-1, Class M-2, Class M-3, Class M-4, Class M-5,
Class M-6, Class M-7, Class M-8 and Class M-9 Certificates, in that order,
in an
amount equal to such certificates’ share of any Prepayment Interest Shortfalls
on the Mortgage Loans to the extent not covered by payments pursuant to Sections
3.23 or Section 4.19 of this Agreement and any Relief Act Interest Shortfall,
in
each case that were allocated to such Class for such Distribution Date and
for
any prior Distribution Date, to the extent not previously reimbursed pursuant
to
Section 1.02;
(vi) to
the
Reserve Fund, the amount by which the Net WAC Rate Carryover Amounts, if any,
with respect to the Class A Certificates and Mezzanine Certificates exceeds
the
sum of any amounts received by the Securities Administrator with respect to
the
Cap Contracts since the prior Distribution Date and any amount in the Reserve
Fund that was not distributed on prior Distribution Dates;
(vii) commencing
on the Distribution Date occurring in October 2007, to the Supplemental Interest
Trust and then from the Supplemental Interest Trust to the Swap Provider, an
amount equal to any Swap Termination Payment owed to the Swap Provider due
to a
Swap Provider Trigger Event pursuant to the Swap Agreement (to the extent such
amount has not been paid by the Securities Administrator from any upfront
payment received pursuant to any related replacement interest rate swap
agreement that may be entered into by the Supplemental Interest Trust Trustee
on
behalf of the Supplemental Interest Trust);
(viii)
to the
Holders of the Class CE Certificates the Interest Distribution Amount and any
Overcollateralization Reduction Amount for such Distribution Date;
and
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(ix) to
the
Holders of the Class R Certificates, in respect of the Class R-III Interest,
any
remaining amounts; provided that if such Distribution Date is the Distribution
Date immediately following the expiration of the latest Prepayment Charge term
as identified on the Mortgage Loan Schedule or any Distribution Date thereafter,
then any such remaining amounts will be distributed first, to the Holders of
the
Class P Certificates, until the Certificate Principal Balance thereof has been
reduced to zero and second, to the Holders of the Class R
Certificates.
The
Class
CE Certificates are intended to receive all principal and interest received
by
the Trust on the Mortgage Loans that is not otherwise distributable to any
other
Class of Regular Certificates or REMIC Regular Interests. If the Securities
Administrator determines that the Residual Certificates are entitled to any
distributions on any Distribution Date other than the final Distribution Date,
the Securities Administrator, prior to any such distribution to any Residual
Certificate, shall notify the Depositor of such impending distribution. Upon
such notification, the Depositor will prepare and request that the other parties
hereto enter into an amendment to the Pooling and Servicing Agreement pursuant
to Section 12.01, to revise such mistake in the distribution
provisions.
On
the
day prior to each Distribution Date, the Securities Administrator shall deposit
all amounts received with respect to the Cap Contracts into the Reserve Fund.
On
each Distribution Date, after making the distributions of the Available
Distribution Amount as set forth above, the Securities Administrator will first,
withdraw from the Reserve Fund all income from the investment of funds in the
Reserve Fund and distribute such amount to the Holders of the Class CE
Certificates, and second, withdraw from the Reserve Fund, to the extent of
amounts remaining on deposit therein (which shall include any payments received
under the Cap Contracts), the amount of any Net WAC Rate Carryover Amount for
such Distribution Date and distribute such amount first, with respect to any
amounts received by the Securities Administrator on account of the Group I
Cap
Contract to the Holders of the Class A-1 Certificates and with respect to any
amounts received by the Securities Administrator on account of the Group II
Cap
Contract concurrently to the Holders of the Class A-2 Certificates on a
pro
rata
basis,
based on the entitlement of each such Class; and, with respect to any amounts
remaining undistributed paid pursuant to the Cap Contracts, second, to the
Class
M-1 Certificates, third, to the Class M-2 Certificates, fourth, to the Class
M-3
Certificates, fifth, to the Class M-4 Certificates, sixth, to the Class M-5
Certificates, seventh, to the Class M-6 Certificates, eighth, to the Class
M-7
Certificates, ninth, to the Class M-8 Certificates and tenth, to the Class
M-9
Certificates, in each case to the extent to the extent any Net WAC Rate
Carryover Amount is allocable to each such Class.
With
respect to any amounts deposited in the Reserve Fund from the Net Monthly Excess
Cashflow under Section 5.01(c)(7)(vi) above and not distributed pursuant to
the preceding paragraph, first, concurrently, (i) to the Holders of the Class
A-1 Certificates, the related Net WAC Rate Carryover Amount remaining unpaid
for
such Distribution Date and (ii) to the Holders of the Class A-2A, Class A-2B,
Class A-2C and Class A-2D Certificates, the related Net WAC Rate Carryover
Amount remaining unpaid for such Distribution Date, on a pro
rata
basis,
based on the entitlement of each such Class; second, sequentially to the Holders
of the Class M-1 Certificates, Class M-2 Certificates, Class M-3 Certificates,
Class M-4 Certificates, Class M-5 Certificates, Class M-6 Certificates, Class
M-7 Certificates, Class M-8 Certificates and Class M-9 Certificates, in that
order, in respect of the related Net WAC Rate Carryover Amount remaining unpaid
for each such Class for such Distribution Date and third, to the Class CE
Certificates.
157
(d) As
described in Section 5.01(c)(2), (3), (5) and (6) above, Net Swap Payments
and Swap Termination Payments (other than Swap Termination Payments resulting
from a Swap Provider Trigger Event) payable by the Supplemental Interest Trust
to the Swap Provider pursuant to the Swap Agreement (to the extent not paid
by
the Securities Administrator from any upfront payment received pursuant to
any
replacement interest rate swap agreement that may be entered into by the
Supplemental Interest Trust Trustee) shall be deducted from the Interest
Remittance Amount, and to the extent of any such remaining amounts due, from
the
Principal Remittance Amount, prior to any distributions to the
Certificateholders.
On
or
before each Distribution Date commencing on the Distribution Date occurring
in
October 2007, such amounts will be distributed to the Supplemental Interest
Trust and paid by the Securities Administrator to the Swap Provider as
follows:
first,
to make
any Net Swap Payment owed to the Swap Provider pursuant to the Swap Agreement
for such Distribution Date; and
second,
to make
any Swap Termination Payment (not due to a Swap Provider Trigger Event) owed
to
the Swap Provider pursuant to the Swap Agreement for such Distribution Date
(to
the extent not paid by the Securities Administrator from any upfront payment
received pursuant to any replacement interest rate swap agreement that may
be
entered into by the Supplemental Interest Trust Trustee).
Any
Swap
Termination Payment triggered by a Swap Provider Trigger Event owed to the
Swap
Provider pursuant to the Swap Agreement will be subordinated to distributions
to
the Holders of the Offered Certificates and shall be paid pursuant to Section
5.01(c)(7)(vii).
(e) On
each
Distribution Date commencing on the Distribution Date occurring in October
2007
and ending immediately following the Distribution Date in March 2012, to the
extent required, following the distribution of the Net Monthly Excess Cashflow
and withdrawals from the Reserve Fund, any Net Swap Payment payable to the
Securities Administrator on behalf of the Supplemental Interest Trust by the
Swap Provider will be withdrawn by the Securities Administrator from amounts
on
deposit in the Supplemental Interest Trust and shall be distributed on the
related Distribution Date in the following order of priority:
first,
concurrently, to each Class of Class A Certificates, the related Senior Interest
Distribution Amount remaining undistributed after the distributions of the
Group
I Interest Remittance Amount and the Group II Interest Remittance Amount, on
a
pro
rata
basis
based on such respective remaining Senior Interest Distribution
Amounts;
second,
sequentially, to the Class X-0, Xxxxx X-0, Class M-3, Class M-4, Class M-5,
Class M-6, Class M-7, Class M-8 and Class M-9 Certificates, in that order,
the
related Interest Distribution Amount and Interest Carry Forward Amount, to
the
extent remaining undistributed after the distributions of the Group I Interest
Remittance Amount, the Group II Interest Remittance Amount and the Net Monthly
Excess Cashflow;
158
third,
to the
Holders of the Class or Classes of Certificates then entitled to receive
distributions in respect of principal, in an amount necessary to maintain the
Required Overcollateralization Amount after taking into account distributions
made pursuant to Section 5.01(c)(7)(i) above;
fourth,
sequentially to the Class X-0, Xxxxx X-0, Class M-3, Class M-4, Class M-5,
Class
M-6, Class M-7, Class M-8 and Class M-9 Certificates, in that order, in each
case up to the related Allocated Realized Loss Amount related to such
Certificates for such Distribution Date remaining undistributed after
distribution of the Net Monthly Excess Cashflow;
fifth,
concurrently, to each class of Class A Certificates, the related Net WAC Rate
Carryover Amount, to the extent remaining undistributed after distributions
of
Net Monthly Excess Cashflow on deposit in the Reserve Fund, on a pro
rata
basis
based on such respective Net WAC Rate Carryover Amounts remaining
unpaid;
sixth,
sequentially, to the Class X-0, Xxxxx X-0, Class M-3, Class M-4, Class M-5,
Class M-6, Class M-7, Class M-8 and Class M-9 Certificates, in that order,
the
related Net WAC Rate Carryover Amount, to the extent remaining undistributed
after distributions are made from the Reserve Fund;
seventh,
to the
Swap Provider, an amount equal to any Swap Termination Payment owed to the
Swap
Provider due to a Swap Provider Trigger Event pursuant to the Swap Agreement
(to
the extent such amount has not been paid by the Securities Administrator from
any upfront payment received pursuant to any related replacement interest rate
swap agreement that may be entered into by the Supplemental Interest Trust
Trustee); and
eighth,
to the
Class CE Certificates, any remaining amounts.
(f) On
each
Distribution Date, the Securities Administrator shall withdraw any amounts
then
on deposit in the Distribution Account that represent Prepayment Charges and
shall distribute such amounts to the Class P Certificateholders as described
above.
(g) All
distributions made with respect to each Class of Certificates on each
Distribution Date shall be allocated pro
rata
among
the outstanding Certificates in such Class based on their respective Percentage
Interests. Payments in respect of each Class of Certificates on each
Distribution Date will be made to the Holders of the respective Class of record
on the related Record Date (except as otherwise provided in Section 5.01(i)
or
Section 10.01 respecting the final distribution on such Class), based on the
aggregate Percentage Interest represented by their respective Certificates,
and
shall be made by wire transfer of immediately available funds to the account
of
any such Holder at a bank or other entity having appropriate facilities
therefor, if such Holder shall have so notified the Securities Administrator
in
writing at least five (5) Business Days prior to the Record Date immediately
prior to such Distribution Date and is the registered owner of Certificates
having an initial aggregate Certificate Principal Balance that is in excess
of
the lesser of (i) $5,000,000 or (ii) two-thirds of the initial Certificate
Principal Balance of such Class of Certificates, or otherwise by check mailed
by
first class mail to the address of such Holder appearing in the Certificate
Register. The final distribution on each Certificate will be made in like
manner, but only upon presentment and surrender of such Certificate at the
Corporate Trust Office of the Securities Administrator or such other location
specified in the notice to Certificateholders of such final
distribution.
159
Each
distribution with respect to a Book-Entry Certificate shall be paid to the
Depository, as Holder thereof, and the Depository shall be responsible for
crediting the amount of such distribution to the accounts of its Depository
Participants in accordance with its normal procedures. Each Depository
Participant shall be responsible for disbursing such distribution to the
Certificate Owners that it represents and to each indirect participating
brokerage firm (a “brokerage firm” or “indirect participating firm”) for which
it acts as agent. Each brokerage firm shall be responsible for disbursing funds
to the Certificate Owners that it represents. None of the Trustee, the
Depositor, the Servicer, the Securities Administrator or the Master Servicer
shall have any responsibility therefor except as otherwise provided by this
Agreement or applicable law.
(h) The
rights of the Certificateholders to receive distributions in respect of the
Certificates, and all interests of the Certificateholders in such distributions,
shall be as set forth in this Agreement. None of the Holders of any Class of
Certificates, the Trustee, the Servicer, the Securities Administrator or the
Master Servicer shall in any way be responsible or liable to the Holders of
any
other Class of Certificates in respect of amounts properly previously
distributed on the Certificates.
(i) Except
as
otherwise provided in Section 10.01, whenever the Securities Administrator
expects that the final distribution with respect to any Class of Certificates
will be made on the next Distribution Date, the Securities Administrator shall,
no later than three (3) days before the related Distribution Date, mail to
each
Holder on such date of such Class of Certificates a notice to the effect
that:
(i) the
Securities Administrator expects that the final distribution with respect to
such Class of Certificates will be made on such Distribution Date but only
upon
presentation and surrender of such Certificates at the office of the Securities
Administrator therein specified, and
(ii) no
interest shall accrue on such Certificates from and after the end of the related
Interest Accrual Period.
Any
funds
not distributed to any Holder or Holders of Certificates of such Class on such
Distribution Date because of the failure of such Holder or Holders to tender
their Certificates shall, on such date, be set aside and held in trust by the
Securities Administrator and credited to the account of the appropriate
non-tendering Holder or Holders. If any Certificates as to which notice has
been
given pursuant to this Section 5.01(i) shall not have been surrendered for
cancellation within six months after the time specified in such notice, the
Securities Administrator shall mail a second notice to the remaining
non-tendering Certificateholders to surrender their Certificates for
cancellation in order to receive the final distribution with respect thereto.
If
within one year after the second notice all such Certificates shall not have
been surrendered for cancellation, the Securities Administrator shall, directly
or through an agent, mail a final notice to the remaining non-tendering
Certificateholders concerning surrender of their Certificates but shall continue
to hold any remaining funds for the benefit of non-tendering Certificateholders.
The costs and expenses of maintaining the funds in trust and of contacting
such
Certificateholders shall be paid out of the assets remaining in such trust
fund.
If within one year after the final notice any such Certificates shall not have
been surrendered for cancellation, the Securities Administrator shall pay to
the
Depositor all such amounts, and all rights of non-tendering Certificateholders
in or to such amounts shall thereupon cease. No interest shall accrue or be
payable to any Certificateholder on any amount held in trust by the Securities
Administrator as a result of such Certificateholder’s failure to surrender its
Certificate(s) on the final Distribution Date for final payment thereof in
accordance with this Section 5.01(i). Any such amounts held in trust by the
Securities Administrator shall be held uninvested in an Eligible
Account.
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(j) Notwithstanding
anything to the contrary herein, (i) in no event shall the Certificate Principal
Balance of a Class A Certificate or a Mezzanine Certificate be reduced more
than
once in respect of any particular amount both (a) allocated to such Certificate
in respect of Realized Losses pursuant to Section 5.04 and (b) distributed
to
the Holder of such Certificate in reduction of the Certificate Principal Balance
thereof pursuant to this Section 5.01 from Net Monthly Excess Cashflow and
(ii)
in no event shall the Uncertificated Balance of a REMIC Regular Interest be
reduced more than once in respect of any particular amount both (a) allocated
to
such REMIC Regular Interest in respect of Realized Losses pursuant to Section
5.04 and (b) distributed on such REMIC Regular Interest in reduction of the
Uncertificated Balance thereof pursuant to this Section 5.01.
SECTION
5.02. Statements
to Certificateholders.
On
each
Distribution Date, the Securities Administrator (based on the information set
forth in the Servicer Reports for such Distribution Date, information provided
by the Swap Provider under the Swap Agreement with respect to payments made
pursuant to the Swap Agreement and information provided by the Cap Counterparty
with respect to payments made pursuant to the Cap Contracts) shall make
available to each Holder of the Certificates, the Servicer and the Credit Risk
Manager, a statement as to the distributions made on such Distribution Date
setting forth:
(i) the
applicable Interest Accrual Periods and general Distribution Dates;
(ii) with
respect to each loan group, the total cash flows received and the general
sources thereof;
(iii) the
aggregate Servicing Fee received by the Servicer during the related Due
Period;
(iv) the
amount, if any, of other fees or expenses accrued and paid, with an
identification of the payee and the general purpose of such fees;
(v) with
respect to each loan group, the amount of the related distribution to Holders
of
the Certificates (by class) allocable to principal, separately identifying
(A)
the aggregate amount of any Principal Prepayments included therein, (B) the
aggregate of all scheduled payments of principal included therein and (C) any
Overcollateralization Increase Amount included therein;
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(vi) with
respect to each loan group, the amount of such distribution to Holders of the
Certificates (by class) allocable to interest and the portion thereof, if any,
provided by the Swap Agreement in the aggregate;
(vii) with
respect to each loan group, the Interest Carry Forward Amounts and any Net
WAC
Rate Carryover Amounts for the related Certificates (if any);
(viii) with
respect to each loan group, the number and aggregate principal balance of any
Mortgage Loans (not including a Liquidated Mortgage Loan as of the end of the
Prepayment Period) that were delinquent (exclusive of Mortgage Loans in
foreclosure) using the “OTS” method (1) one scheduled payment is delinquent, (2)
two scheduled payments are delinquent, (3) three scheduled payments are
delinquent and (4) foreclosure proceedings have been commenced, and loss
information for the period;
(ix) the
number, aggregate principal balance, weighted average remaining term to maturity
and weighted average Mortgage Rate of the Mortgage Loans as of the related
Due
Date;
(x) with
respect to each loan group and any Mortgage Loan that was liquidated during
the
preceding calendar month, the loan number and Scheduled Principal Balance of,
and Realized Loss on, such Mortgage Loan as of the end of the related Prepayment
Period;
(xi) the
total
number and principal balance of any real estate owned, or REO Properties, as
of
the end of the related Prepayment Period;
(xii) with
respect to each loan group, whether the Stepdown Date has occurred and whether
Trigger Event is in effect;
(xiii) with
respect to each loan group, the cumulative Realized Losses through the end
of
the preceding month;
(xiv) the
aggregate amount of Extraordinary Trust Fund Expenses withdrawn from the
Distribution Account for such Distribution Date;
(xv) with
respect to each loan group, the Certificate Principal Balance of the related
Certificates before and after giving effect to the distribution of principal
and
allocation of Allocated Realized Loss Amounts on such Distribution
Date;
(xvi) with
respect to each loan group, the number and Scheduled Principal Balance of all
the Mortgage Loans for the following Distribution Date;
(xvii) with
respect to each loan group, the three-month rolling average of the percent
equivalent of a fraction, the numerator of which is the aggregate Scheduled
Principal Balance of the Mortgage Loans in such loan group that are 60 days
or
more delinquent or are in bankruptcy or foreclosure or are REO Properties,
and
the denominator of which is the Scheduled Principal Balances of all of the
Mortgage Loans in such loan group;
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(xviii) the
Certificate Factor for each such Class of Certificates applicable to such
Distribution Date;
(xix) the
Interest Distribution Amount in respect of the Class A Certificates, the
Mezzanine Certificates and the Class CE Certificates for such Distribution
Date
and the Interest Carry Forward Amount, if any, with respect to the Class A
Certificates and the Mezzanine Certificates on such Distribution Date, and
in
the case of the Class A Certificates and the Mezzanine Certificates separately
identifying any reduction thereof due to allocations of Prepayment Interest
Shortfalls and interest shortfalls including the following Realized Losses:
Relief Act Interest Shortfalls and Net WAC Rate Carryover Amounts;
(xx) the
aggregate amount of any Prepayment Interest Shortfall for such Distribution
Date, to the extent not covered by payments by the Servicer pursuant to
Section 3.23 of this Agreement, the Master Servicer pursuant to
Section 4.19 of this Agreement;
(xxi) the
aggregate amount of Relief Act Interest Shortfalls for such Distribution
Date;
(xxii) the
amount of, if any, of Net Monthly Excess Cashflow or excess spread and the
application of such Net Monthly Excess Cashflow;
(xxiii) the
Required Overcollateralization Amount and the Credit Enhancement Percentage
for
such Distribution Date;
(xxiv) the
Overcollateralization Increase Amount, if any, for such Distribution
Date;
(xxv) the
Overcollateralization Reduction Amount, if any, for such Distribution
Date;
(xxvi) the
Pass-Through Rate for each class of Certificates for such Distribution
Date;
(xxvii)
the
amount of any deposit to the Reserve Fund contemplated by
Section 3.25(b);
(xxviii) the
balance of the Reserve Fund prior to the deposit or withdrawal of any amounts
on
such Distribution Date;
(xxix) the
amount of any deposit to the Reserve Fund pursuant to
Section 5.01(c)(8)(vi);
163
(xxx) the
Aggregate Loss Severity Percentage;
(xxxi) with
respect to each loan group, the amount of the Prepayment Charges remitted by
the
Servicer;
(xxxii) the
amount of any Net Swap Payment payable to the Trust, any related Net Swap
Payment payable to the Swap Provider, any Swap Termination Payment payable
to
the Trust and any related Swap Termination Payment payable to the Swap Provider;
and
(xxxiii) the
amounts received under the Cap Contracts.
The
Securities Administrator will make such statement (and, at its option, any
additional files containing the same information in an alternative format)
available each month to the Certificateholders and the Rating Agencies via
the
Securities Administrator’s internet website. The Securities Administrator’s
internet website shall initially be located at http:\\xxx.xxxxxxx.xxx and
assistance in using the website can be obtained by calling the Securities
Administrator’s customer service desk at 0-000-000-0000. Parties that are unable
to use the above distribution options are entitled to have a paper copy mailed
to them via first class mail by calling the customer service desk and indicating
such. The Securities Administrator shall have the right to change the way such
statements are distributed in order to make such distribution more convenient
and/or more accessible to the above parties and the Securities Administrator
shall provide timely and adequate notification to all above parties regarding
any such changes.
In
the
case of information furnished pursuant to subclauses (i) and (ii) above, the
amounts shall be expressed as a dollar amount per Single Certificate of the
relevant Class.
Within
a
reasonable period of time after the end of each calendar year, the Securities
Administrator shall furnish upon request to each Person who at any time during
the calendar year was a Holder of a Regular Certificate a statement containing
the information set forth in subclauses (i) through (iii) above, aggregated
for
such calendar year or applicable portion thereof during which such person was
a
Certificateholder. Such obligation of the Securities Administrator shall be
deemed to have been satisfied to the extent that substantially comparable
information shall be provided by the Securities Administrator pursuant to any
requirements of the Code as from time to time are in force.
Within
a
reasonable period of time after the end of each calendar year, the Securities
Administrator shall furnish upon request to each Person who at any time during
the calendar year was a Holder of a Residual Certificate a statement setting
forth the amount, if any, actually distributed with respect to the Residual
Certificates, as appropriate, aggregated for such calendar year or applicable
portion thereof during which such Person was a Certificateholder.
The
Securities Administrator shall, upon request, furnish to each Certificateholder
during the term of this Agreement, such periodic, special, or other reports
or
information, whether or not provided for herein, as shall be reasonable with
respect to the Certificateholder, as applicable, or otherwise with respect
to
the purposes of this Agreement, all such reports or information to be provided
at the expense of the Certificateholder, in accordance with such reasonable
and
explicit instructions and directions as the Certificateholder may
provide.
164
On
each
Distribution Date the Securities Administrator shall provide Bloomberg Financial
Markets, L.P. (“Bloomberg”) CUSIP level factors for each Class of Certificates
as of such Distribution Date, using a format and media mutually acceptable
to
the Securities Administrator and Bloomberg.
SECTION
5.03. Servicer
Reports; P&I Advances.
(a) On
or
before 12:00 noon New York time on the 18th calendar day of the month, and
if
the 18th calendar day is not a Business Day, the immediately following Business
Day, the Servicer shall deliver to the Master Servicer and the Securities
Administrator by telecopy or electronic mail (or by such other means as the
Servicer, the Master Servicer and the Securities Administrator may agree from
time to time) a remittance report containing such information with respect
to
the related Mortgage Loans and the related Distribution Date as is reasonably
available to the Servicer as the Master Servicer or the Securities Administrator
may reasonably require so as to enable the Master Servicer to master service
the
Mortgage Loans and oversee the servicing by the Servicer and the Securities
Administrator to fulfill its obligations hereunder with respect to securities
and tax reporting.
(b) The
amount of P&I Advances to be made by the Servicer on any Distribution Date
shall equal, subject to Section 5.03(d), (i) the aggregate amount of Monthly
Payments (net of the related Servicing Fees), due during the related Due Period
in respect of the Mortgage Loans serviced by the Servicer, which Monthly
Payments were delinquent as of the close of business on the related
Determination Date and (ii) with respect to each REO Property, which was
acquired during or prior to the related Prepayment Period and as to which an
REO
Disposition did not occur during the related Prepayment Period, an amount equal
to the excess, if any, of the REO Imputed Interest on such REO Property for
the
most recently ended calendar month, over the net income from such REO Property
deposited in the Collection Account pursuant to Section 3.22 of this Agreement
for distribution on such Distribution Date; provided, however, the Servicer
shall not be required to make P&I Advances with respect to Relief Act
Interest Shortfalls, shortfalls due to bankruptcy proceedings or with respect
to
Prepayment Interest Shortfalls in excess of its obligations under Section 3.23.
For purposes of the preceding sentence, the Monthly Payment on each Balloon
Mortgage Loan with a delinquent Balloon Payment is equal to the assumed monthly
payment that would have been due on the related Due Date based on the original
principal amortization schedule for such Balloon Mortgage Loan.
By
12:00
noon New York time on the Servicer Remittance Date, the Servicer shall remit
in
immediately available funds to the Securities Administrator for deposit in
the
Distribution Account an amount equal to the aggregate amount of P&I
Advances, if any, to be made in respect of the Mortgage Loans for the related
Distribution Date either (i) from its own funds or (ii) from the Collection
Account, to the extent of any Amounts Held For Future Distribution on deposit
therein (in which case it will cause to be made an appropriate entry in the
records of the Collection Account that Amounts Held For Future Distribution
have
been, as permitted by this Section 5.03, used by the Servicer in discharge
of
any such P&I Advance) or (iii) in the form of any combination of (i) and
(ii) aggregating the total amount of P&I Advances to be made by the Servicer
with respect to the Mortgage Loans. In addition, the Servicer shall have the
right to reimburse itself for any outstanding P&I Advance or Servicing
Advance made from its own funds from Amounts Held for Future Distribution.
The
Servicer will be obligated to advance or cause to be advanced to the Master
Servicer for deposit in the Distribution Account, from time to time, from (i)
its own funds, (ii) funds in the Collection Account that are Amounts Held for
Future Distribution or (iii) a combination of (i) and (ii), Servicing Advances.
Any Amounts Held For Future Distribution used by the Servicer to make P&I
Advances or Servicing Advances or to reimburse itself for outstanding P&I
Advances or Servicing Advances shall be appropriately reflected in the
Servicer’s records and replaced by the Servicer by deposit in the Collection
Account no later than the close of business on the Servicer Remittance Date
immediately following the Due Period or Prepayment Period for which such amounts
relate. The Securities Administrator will notify the Servicer and the Master
Servicer by the close of business on the Business Day prior to the Distribution
Date in the event that the amount remitted by the Servicer to the Securities
Administrator on such date is less than the P&I Advances required to be made
by the Servicer for the related Distribution Date.
165
(c) The
obligation of the Servicer to make such P&I Advances is mandatory,
notwithstanding any other provision of this Agreement but subject to (d) below,
and, with respect to any related Mortgage Loan or REO Property, shall continue
until a Final Recovery Determination in connection therewith or the removal
thereof from the Trust Fund pursuant to any applicable provision of this
Agreement, except as otherwise provided in this Section.
(d) Notwithstanding
anything herein to the contrary, no P&I Advance or Servicing Advance shall
be required to be made hereunder by the Servicer if such P&I Advance or
Servicing Advance would, if made, constitute a Nonrecoverable P&I Advance or
Nonrecoverable Servicing Advance, respectively. The determination by the
Servicer that it has made a Nonrecoverable P&I Advance or a Nonrecoverable
Servicing Advance or that any proposed P&I Advance or Servicing Advance, if
made, would constitute a Nonrecoverable P&I Advance or Nonrecoverable
Servicing Advance, respectively, shall be evidenced by a certification of a
Servicing Officer delivered to the Master Servicer.
(e) In
the
event that the Servicer (or any successor thereto) fails to make a required
P&I Advance, the Master Servicer (in its capacity as successor to the
Servicer) will be required to make such P&I Advance on the Distribution Date
on which the Servicer was required to make such P&I Advance, subject to its
determination of recoverability.
SECTION
5.04. Allocation
of Realized Losses.
(a) Prior
to
the Determination Date, the Servicer shall determine as to each Mortgage Loan
serviced by the Servicer and any related REO Property and include in the monthly
remittance report provided to the Master Servicer and the Securities
Administrator (substantially in the form of Schedule 4 hereto) such information
as is reasonably available to the Servicer as the Master Servicer or the
Securities Administrator may reasonably require so as to enable the Master
Servicer to master service the Mortgage Loans and oversee the servicing by
the
Servicer and the Securities Administrator to fulfill its obligations hereunder
with respect to securities and tax reporting, which shall include, but not
be
limited to: (i) the total amount of Realized Losses, if any, incurred in
connection with any Final Recovery Determinations made during the related
Prepayment Period; and (ii) the respective portions of such Realized Losses
allocable to interest and allocable to principal. Prior to each Determination
Date, the Servicer shall also determine as to each Mortgage Loan: (i) the total
amount of Realized Losses, if any, incurred in connection with any Deficient
Valuations made during the related Prepayment Period; and (ii) the total amount
of Realized Losses, if any, incurred in connection with Debt Service Reductions
in respect of Monthly Payments due during the related Due Period.
166
(b) All
Realized Losses on the Mortgage Loans allocated to any REMIC I Regular Interest
pursuant to Section 5.04(c) on the Mortgage Loans shall be allocated by the
Securities Administrator on each Distribution Date as follows: first,
to Net
Monthly Excess Cashflow and to Net Swap Payments received from the Swap Provider
under the Swap Agreement for that purpose; second,
to the
Class CE Certificates; third,
to the
Class M-9 Certificates, until the Certificate Principal Balance of the Class
M-9
Certificates has been reduced to zero; fourth,
to the
Class M-8 Certificates, until the Certificate Principal Balance of the Class
M-8
Certificates has been reduced to zero; fifth,
to the
Class M-7 Certificates, until the Certificate Principal Balance of the Class
M-7
Certificates has been reduced to zero; sixth,
to the
Class M-6 Certificates, until the Certificate Principal Balance of the Class
M-6
Certificates has been reduced to zero; seventh,
to the
Class M-5 Certificates, until the Certificate Principal Balance of the Class
M-5
Certificates has been reduced to zero; eighth,
to the
Class M-4 Certificates, until the Certificate Principal Balance of the Class
M-4
Certificates has been reduced to zero; ninth,
to the
Class M-3 Certificates, until the Certificate Principal Balance of the Class
M-3
Certificates has been reduced to zero, tenth,
to the
Class M-2 Certificates, until the Certificate Principal Balance of the Class
M-2
Certificates has been reduced to zero; and eleventh,
to the
Class M-1 Certificates, until the Certificate Principal Balance of the Class
M-1
Certificates has been reduced to zero. All Realized Losses to be allocated
to
the Certificate Principal Balances of all Classes on any Distribution Date
shall
be so allocated after the actual distributions to be made on such date as
provided above. All references above to the Certificate Principal Balance of
any
Class of Certificates shall be to the Certificate Principal Balance of such
Class immediately prior to the relevant Distribution Date, before reduction
thereof by any Realized Losses, in each case to be allocated to such Class
of
Certificates, on such Distribution Date.
Any
allocation of Realized Losses to a Mezzanine Certificate on any Distribution
Date shall be made by reducing the Certificate Principal Balance thereof by
the
amount so allocated; any allocation of Realized Losses to a Class CE Certificate
shall be made by reducing the amount otherwise payable in respect thereof
pursuant to Section 5.01(c)(8)(viii). No allocations of any Realized Losses
shall be made to the Certificate Principal Balances of the Class A Certificates
or Class P Certificates.
As
used
herein, an allocation of a Realized Loss on a “pro
rata
basis”
among two or more specified Classes of Certificates means an allocation on
a
pro
rata
basis,
among the various Classes so specified, to each such Class of Certificates
on
the basis of their then outstanding Certificate Principal Balances prior to
giving effect to distributions to be made on such Distribution Date. All
Realized Losses and all other losses allocated to a Class of Certificates
hereunder will be allocated among the, Certificates of such Class in proportion
to the Percentage Interests evidenced thereby.
167
In
addition, in the event that the Servicer receives any Subsequent Recoveries
with
respect to a Mortgage Loan serviced by it, the Servicer shall deposit such
funds
into the Collection Account pursuant to Section 3.08. If, after taking into
account such Subsequent Recoveries, the amount of a Realized Loss is reduced,
the amount of such Subsequent Recoveries will be applied to increase the
Certificate Principal Balance of the Class of Mezzanine Certificates with the
highest payment priority to which Realized Losses have been allocated, but
not
by more than the amount of Realized Losses previously allocated to that Class
of
Mezzanine Certificates pursuant to this Section 5.04 and not previously
reimbursed to such Class of Mezzanine Certificates with Net Monthly Excess
Cashflow pursuant to Section 5.01(c)(8). The amount of any remaining Subsequent
Recoveries will be applied to sequentially increase the Certificate Principal
Balance of the Mezzanine Certificates, beginning with the Class of Mezzanine
Certificates with the next highest payment priority, up to the amount of such
Realized Losses previously allocated to such Class of Mezzanine Certificates
pursuant to this Section 5.04 and not previously reimbursed to such Class of
Mezzanine Certificates with Net Monthly Excess Cashflow pursuant to Section
5.01(c)(7)(iii). Holders of such Certificates will not be entitled to any
payment in respect of current interest on the amount of such increases for
any
Interest Accrual Period preceding the Distribution Date on which such increase
occurs. Any such increases shall be applied to the Certificate Principal Balance
of each Mezzanine Certificate of such Class in accordance with its respective
Percentage Interest.
(c) All
Realized Losses on the Group I Mortgage Loans shall be allocated on each
Distribution Date first to REMIC I Regular Interest I until the Uncertificated
Balance of such REMIC I Regular Interest has been reduced to zero and second,
to
REMIC I Regular Interest I-1-A through REMIC I Regular Interest I-54-B, starting
with the lowest numerical denomination until such REMIC I Regular Interest
has
been reduced to zero, provided that, for REMIC I Regular Interests with the
same
numerical denomination, such Realized Losses shall be allocated pro
rata
between
such REMIC I Regular Interests.
All
Realized Losses on the Group II Mortgage Loans shall be allocated on each
Distribution Date first, to REMIC I Regular Interest II until the Uncertificated
Balance of such REMIC I Regular Interest has been reduced to zero and second,
to
REMIC I Regular Interest II-1-A through REMIC I Regular Interest II-54-B,
starting with the lowest numerical denomination until such REMIC I Regular
Interest has been reduced to zero, provided that, for REMIC I Regular Interests
with the same numerical denomination, such Realized Losses shall be allocated
pro
rata
between
such REMIC I Regular Interests.
(ii) The
REMIC
II Marker Allocation Percentage of all Realized Losses on the Mortgage Loans
shall be allocated by the Securities Administrator, on each Distribution Date
to
the following REMIC II Regular Interests in the specified percentages, as
follows: first, to Uncertificated Interest payable to the REMIC II Regular
Interest AA and REMIC II Regular Interest ZZ up to an aggregate amount equal
to
the REMIC II Interest Loss Allocation Amount, 98.00% and 2.00%, respectively;
second, to the Uncertificated Balances of the REMIC II Regular Interest AA
and
REMIC II Regular Interest ZZ up to an aggregate amount equal to the REMIC II
Principal Loss Allocation Amount, 98.00% and 2.00%, respectively; third, to
the
Uncertificated Balances of REMIC II Regular Interest AA, REMIC II Regular
Interest M-9 and REMIC II Regular Interest ZZ, 98.00%, 1.00% and 1.00%,
respectively, until the Uncertificated Balance of REMIC II Regular Interest
M-9
has been reduced to zero; fourth, to the Uncertificated Balances of REMIC II
Regular Interest AA, REMIC II Regular Interest M-8 and REMIC II Regular Interest
ZZ, 98.00%, 1.00% and 1.00%, respectively, until the Uncertificated Balance
of
REMIC II Regular Interest M-8 has been reduced to zero; fifth, to the
Uncertificated Balances of REMIC II Regular Interest AA, REMIC II Regular
Interest M-7 and REMIC II Regular Interest ZZ, 98.00%, 1.00% and 1.00%,
respectively, until the Uncertificated Balance of REMIC II Regular Interest
M-7
has been reduced to zero; sixth, to the Uncertificated Balances of REMIC II
Regular Interest AA, REMIC II Regular Interest M-6 and REMIC II Regular Interest
ZZ, 98.00%, 1.00% and 1.00%, respectively, until the Uncertificated Balance
of
REMIC II Regular Interest M-6 has been reduced to zero; seventh, to the
Uncertificated Balances of REMIC II Regular Interest AA, REMIC II Regular
Interest M-5 and REMIC II Regular Interest ZZ, 98.00%, 1.00% and 1.00%,
respectively, until the Uncertificated Balance of REMIC II Regular Interest
M-5
has been reduced to zero; eighth, to the Uncertificated Balances of REMIC II
Regular Interest AA, REMIC II Regular Interest M-4 and REMIC II Regular Interest
ZZ, 98.00%, 1.00% and 1.00%, respectively, until the Uncertificated Balance
of
REMIC II Regular Interest M-4 has been reduced to zero; ninth, to the
Uncertificated Balances of REMIC II Regular Interest AA, REMIC II Regular
Interest M-3 and REMIC II Regular Interest ZZ, 98.00%, 1.00% and 1.00%,
respectively, until the Uncertificated Balance of REMIC II Regular Interest
M-3
has been reduced to zero; tenth, to the Uncertificated Balances of REMIC II
Regular Interest AA, REMIC II Regular Interest M-2 and REMIC II Regular Interest
ZZ, 98.00%, 1.00% and 1.00%, respectively, until the Uncertificated Balance
of
REMIC II Regular Interest M-2 has been reduced to zero; and eleventh, to the
Uncertificated Balances of REMIC II Regular Interest AA, REMIC II Regular
Interest M-1 and REMIC II Regular Interest ZZ, 98.00%, 1.00% and 1.00%,
respectively, until the Uncertificated Balance of REMIC II Regular Interest
M-1
has been reduced to zero.
168
(iii) The
REMIC
II Sub WAC Allocation Percentage of all Realized Losses shall be applied after
all distributions have been made on each Distribution Date first, so as to
keep
the Uncertificated Balance of each REMIC II Regular Interest ending with the
designation “GRP” equal to 0.01% of the aggregate Stated Principal Balance of
the Mortgage Loans in the related loan group; second, to each REMIC II Regular
Interest ending with the designation “SUB,” so that the Uncertificated Balance
of each such REMIC II Regular Interest is equal to 0.01% of the excess of (x)
the aggregate Stated Principal Balance of the Mortgage Loans in the related
loan
group over (y) the current Certificate Principal Balance of the Class A
Certificate in the related loan group (except that if any such excess is a
larger number than in the preceding distribution period, the least amount of
Realized Losses shall be applied to such REMIC II Regular Interests such that
the REMIC II Subordinated Balance Ratio is maintained); and third, any remaining
Realized Losses shall be allocated to REMIC II Regular Interest XX.
SECTION
5.05. Compliance
with Withholding Requirements.
Notwithstanding
any other provision of this Agreement, the Securities Administrator shall comply
with all federal withholding requirements respecting payments to
Certificateholders of interest or original issue discount that the Securities
Administrator reasonably believes are applicable under the Code. The consent
of
Certificateholders shall not be required for such withholding. In the event
the
Securities Administrator does withhold any amount from interest or original
issue discount payments or advances thereof to any Certificateholder pursuant
to
federal withholding requirements, the Securities Administrator shall indicate
the amount withheld to such Certificateholders.
169
SECTION
5.06. Reports
Filed with Securities and Exchange Commission.
(a) (i) Within
15
days after each Distribution Date (subject to permitted extensions under the
Exchange Act), the Securities Administrator shall prepare and file on behalf
of
the Trust any Form 10-D required by the Exchange Act, in form and substance
as
required by the Exchange Act. The Securities Administrator shall file each
Form
10-D with a copy of the related Monthly Statement attached thereto. Any
disclosure in addition to the Monthly Statement that is required to be included
on Form 10-D (“Additional Form 10-D Disclosure”) shall be reported by the
parties set forth on Exhibit G to the Depositor and the Securities Administrator
and directed and approved by the Depositor pursuant to the following paragraph,
and the Securities Administrator will have no duty or liability for any failure
hereunder to determine or prepare any Additional Form 10-D Disclosure, except
as
set forth in the next paragraph.
(ii) As
set
forth on Exhibit G hereto, within 5 calendar days after the related Distribution
Date, (A) certain parties to the ACE Securities Corp. Home Equity Loan Trust,
Series 2007-WM2 transaction shall be required to provide to the Securities
Administrator and the Depositor, to the extent known by a responsible officer
thereof, in XXXXX-compatible form, or in such other form as otherwise agreed
upon by the Securities Administrator and such party, the form and substance
of
any Additional Form 10-D Disclosure, if applicable, together with an Additional
Disclosure Notification in the form of Exhibit H hereto (an “Additional
Disclosure Notification”) and (B) the Depositor will approve, as to form and
substance, or disapprove, as the case may be, the inclusion of the Additional
Form 10-D Disclosure on Form 10-D. The Depositor will be responsible for any
reasonable fees and expenses assessed or incurred by the Securities
Administrator in connection with including any Additional Form 10-D Disclosure
on Form 10-D pursuant to this paragraph.
(iii) After
preparing the Form 10-D, the Securities Administrator shall upon request,
forward electronically a copy of the Form 10-D to the Depositor (provided that
such Form 10-D includes any Additional Form 10-D Disclosure). Within two (2)
Business Days after receipt of such copy but no later than the 12th
calendar
day after the Distribution Date, the Depositor shall notify the Securities
Administrator in writing (which may be furnished electronically) of any changes
to or approval of such Form 10-D. In the absence of receipt of any written
changes or approval by the due date specified herein, or if the Depositor does
not request a copy of a Form 10-D, the Securities Administrator shall be
entitled to assume that such Form 10-D is in final form and the Securities
Administrator may proceed with the execution and filing of the Form 10-D. A
duly
authorized representative of the Master Servicer shall sign the Form 10-D.
If a
Form 10-D cannot be filed on time or if a previously filed Form 10-D needs
to be
amended, the Securities Administrator will follow the procedures set forth
in
Section 5.06(c)(ii). Promptly (but no later than 1 Business Day) after filing
with the Commission, the Securities Administrator will make available on its
internet website a final executed copy of each Form 10-D prepared and filed
by
the Securities Administrator. Each party to this Agreement acknowledges that
the
performance by the Securities Administrator and the Master Servicer of their
duties under this Section 5.06(a) related to the timely preparation, execution
and filing of Form 10-D is contingent upon such parties strictly observing
all
applicable deadlines in the performance of their duties as set forth in this
Agreement. Neither the Master Servicer nor the Securities Administrator shall
have any liability for any loss, expense, damage, claim arising out of or with
respect to any failure to properly prepare, execute and/or timely file such
Form
10-D, where such failure results from the Securities Administrator’s inability
or failure to receive, on a timely basis, any information from any other party
hereto needed to prepare, arrange for execution or file such Form 10-D, not
resulting from its own negligence, bad faith or willful misconduct.
170
(b) (i) Within
four (4) Business Days after the occurrence of an event requiring disclosure
on
Form 8-K (each such event, a “Reportable Event”), and if requested by the
Depositor, the Securities Administrator shall prepare and file on behalf of
the
Trust a Form 8-K, as required by the Exchange Act, provided that the Depositor
shall file the initial Form 8-K in connection with the issuance of the
Certificates. Any disclosure or information related to a Reportable Event or
that is otherwise required to be included on Form 8-K other than the initial
Form 8-K (“Form 8-K Disclosure Information”) shall be reported by the parties
set forth on Exhibit G to the Depositor and the Securities Administrator and
directed and approved by the Depositor pursuant to the following paragraph,
and
the Securities Administrator will have no duty or liability for any failure
hereunder to determine or prepare any Form 8-K Disclosure Information or any
Form 8-K, except as set forth in the next paragraph.
(ii) As
set
forth on Exhibit G hereto, for so long as the Trust is subject to the Exchange
Act reporting requirements, no later than the close of business New York City
time on the 2nd Business Day after the occurrence of a Reportable Event (i)
the
parties to the ACE Securities Corp. Home Equity Loan Trust, Series 2007-WM2
transaction shall be required to provide to the Securities Administrator and
Depositor, to the extent known by a responsible officer thereof, in
XXXXX-compatible form, or in such other form as otherwise agreed upon by the
Securities Administrator and such party, the form and substance of any Form
8-K
Disclosure Information, if applicable, together with an Additional Disclosure
Notification and (ii) the Depositor will approve, as to form and substance,
or
disapprove, as the case may be, the inclusion of the Form 8-K Disclosure
Information. The Depositor will be responsible for any reasonable fees and
expenses assessed or incurred by the Securities Administrator in connection
with
including any Form 8-K Disclosure Information on Form 8-K pursuant to this
paragraph.
(iii) After
preparing the Form 8-K, the Securities Administrator shall upon request, forward
electronically a copy of the Form 8-K to the Depositor. Promptly, but no later
than the close of business on the third Business Day after the Reportable Event,
the Depositor shall notify the Securities Administrator in writing (which may
be
furnished electronically) of any changes to or approval of such Form 8-K. In
the
absence of receipt of any written changes or approval by the third Business
Day,
or if the Depositor does not request a copy of a Form 8-K, the Securities
Administrator shall be entitled to assume that such Form 8-K is in final form
and the Securities Administrator may proceed with the execution and filing
of
the Form 8-K. A duly authorized representative of the Master Servicer shall
sign
each Form 8-K. If a Form 8-K cannot be filed on time or if a previously filed
Form 8-K needs to be amended, the Securities Administrator will follow the
procedures set forth in Section 5.06(c)(ii). Promptly (but no later than 1
Business Day) after filing with the Commission, the Securities Administrator
will, make available on its internet website a final executed copy of each
Form
8-K that has been prepared and filed by the Securities Administrator. The
parties to this Agreement acknowledge that the performance by the Master
Servicer and the Securities Administrator of their duties under this Section
5.06(b) related to the timely preparation, execution and filing of Form 8-K
is
contingent upon such parties strictly observing all applicable deadlines in
the
performance of their duties under this Agreement. Neither the Master Servicer
nor the Securities Administrator shall have any liability for any loss, expense,
damage, claim arising out of or with respect to any failure to properly prepare,
execute and/or timely file such Form 8-K, where such failure results from the
Securities Administrator’s inability or failure to receive, on a timely basis,
any information from any other party hereto needed to prepare, execute or
arrange for execution or file such Form 8-K, not resulting from its own
negligence, bad faith or willful misconduct.
171
(c) (i) On
or
prior to January 30th of the first year in which the Securities Administrator
is
able to do so under applicable law, the Securities Administrator shall prepare
and file a Form 15 suspension notification relating to the automatic suspension
of reporting in respect of the Trust under the Exchange Act.
(ii) In
the
event that the Securities Administrator is unable to timely file with the
Commission all or any required portion of any Form 8-K, 10-D or 10-K required
to
be filed by this Agreement because required disclosure information was either
not delivered to it or delivered to it after the delivery deadlines set forth
in
this Agreement or for any other reason, the Securities Administrator will
promptly electronically notify the Depositor. In the case of Form 10-D and
10-K,
the parties to this Agreement will cooperate to prepare and file a Form 12b-25
and a 10-DA and 10-KA as applicable, pursuant to Rule 12b-25 of the Exchange
Act. In the case of Form 8-K, the Securities Administrator will, upon receipt
of
all required Form 8-K Disclosure Information and upon the approval and direction
of the Depositor, include such disclosure information on the next Form 10-D.
In
the event that any previously filed Form 8-K, 10-D or 10-K needs to be amended
and such amendment includes any Additional Form 10-D Disclosure (other than
for
the purposes of restating any Monthly Report), any Additional Form 10-K
Disclosure or any Form 8-K Disclosure Information or any amendment to such
disclosure, the Securities Administrator will electronically notify the
Depositor only if the amendment pertains to an additional reporting item being
revised and/or amended on such form, but not if an amendment is being filed
as a
result of a Remittance Report revision, and the Depositor will cooperate with
the Securities Administrator in preparing any necessary 8-KA, 10-DA or 10-KA.
Any Form 15, Form 12b-25 or any amendment to Form 8-K, 10-D or 10-K shall be
signed by a duly authorized representative, or senior officer in charge of
master servicing, as applicable, of the Master Servicer. The parties to this
Agreement acknowledge that the performance by the Securities Administrator
and
the Master Servicer of their duties under this Section 5.06(c) related to the
timely preparation, execution and filing of Form 15, a Form 12b-25 or any
amendment to Form 8-K, 10-D or 10-K is contingent upon each such party
performing its duties under this Agreement. Neither the Master Servicer nor
the
Securities Administrator shall have any liability for any loss, expense, damage,
claim arising out of or with respect to any failure to properly prepare, execute
and/or timely file any such Form 15, Form 12b-25 or any amendments to Forms
8-K,
10-D or 10-K, where such failure results from the Securities Administrator’s
inability or failure to receive, on a timely basis, any information from any
other party hereto needed to prepare, execute or arrange for execution or file
such Form 15, Form 12b-25 or any amendments to Forms 8-K, 10-D or 10-K, not
resulting from its own negligence, bad faith or willful misconduct.
172
(d) (i) On
or
prior to the 90th
day
after the end of each fiscal year of the Trust or such earlier date as may
be
required by the Exchange Act (the “10-K Filing Deadline”) (it being understood
that the fiscal year for the Trust ends on December 31st of each year),
commencing in March 2008, the Securities Administrator shall prepare and file
on
behalf of the Trust a Form 10-K, in form and substance as required by the
Exchange Act. Each such Form 10-K shall include the following items, in each
case to the extent they have been delivered to the Securities Administrator
within the applicable time frames set forth in this Agreement, the related
servicing agreement and custodial agreements, (i) an annual compliance statement
for the Servicer, each Additional Servicer, the Master Servicer and the
Securities Administrator and any Servicing Function Participant engaged by
such
parties (each, a “Reporting Servicer”) as described under Section 3.17 and
Section 4.15 and in such other agreements, (ii)(A) the annual reports on
assessment of compliance with servicing criteria for each Reporting Servicer,
as
described under Section 3.18 and Section 4.16 and in such other agreements,
and
(B) if each Reporting Servicer’s report on assessment of compliance with
servicing criteria described under Section 3.18 and Section 4.16 identifies
any
material instance of noncompliance, disclosure identifying such instance of
noncompliance, or if each Reporting Servicer’s report on assessment of
compliance with servicing criteria described under Section 3.18 and Section
4.16
is not included as an exhibit to such Form 10-K, disclosure that such report
is
not included and an explanation why such report is not included, (iii)(A) the
registered public accounting firm attestation report for each Reporting
Servicer, as described under Section 3.18 and Section 4.17, or in such other
agreement and (B) if any registered public accounting firm attestation report
described under Section 3.18 and Section 4.17 identifies any material instance
of noncompliance, disclosure identifying such instance of noncompliance, or
if
any such registered public accounting firm attestation report is not included
as
an exhibit to such Form 10-K, disclosure that such report is not included and
an
explanation why such report is not included, and (iv) a Xxxxxxxx-Xxxxx
Certification as described in Section 3.20 and Section 4.18 (provided, however,
that the Securities Administrator, at its discretion, may omit from the Form
10-K any annual compliance statement, assessment of compliance or attestation
report that is not required to be filed with such Form 10-K pursuant to
Regulation AB). Any disclosure or information in addition to (i) through (iv)
above that is required to be included on Form 10-K (“Additional Form 10-K
Disclosure”) shall be reported by the parties set forth on Exhibit G to the
Depositor and the Securities Administrator and directed and approved by the
Depositor pursuant to the following paragraph, and the Securities Administrator
will have no duty or liability for any failure hereunder to determine or prepare
any Additional Form 10-K Disclosure, except as set forth in the next
paragraph.
(ii) As
set
forth on Exhibit G hereto, no later than March 15 of each year that the Trust
is
subject to the Exchange Act reporting requirements, commencing in 2008, (i)
parties to the ACE Securities Corp. Home Equity Loan Trust, Series 2007-WM2
transaction shall be required to provide to the Securities Administrator and
Depositor, to the extent known, by a responsible officer thereof, in
XXXXX-compatible form, or in such other form as otherwise agreed upon by the
Securities Administrator and such party, the form and substance of any
Additional Form 10-K Disclosure, if applicable, together with an Additional
Disclosure Notification and (ii) the Depositor will approve, as to form and
substance, or disapprove, as the case may be, the inclusion of the Additional
Form 10-K Disclosure on Form 10-K. The Depositor will be responsible for any
reasonable fees and expenses assessed or incurred by the Securities
Administrator in connection with including any Additional Form 10-K Disclosure
on Form 10-K pursuant to this paragraph.
173
(iii) After
preparing the Form 10-K, the Securities Administrator shall upon request,
forward electronically a copy of the Form 10-K to the Depositor. Within three
(3) Business Days after receipt of such copy, but in no event later than March
25th
of each
year that the Trust is subject to Exchange Act reporting requirements, the
Depositor shall notify the Securities Administrator in writing (which may be
furnished electronically) of any changes to or approval of such Form 10-K.
In
the absence of receipt of any written changes or approval by March 25th, or
if
the Depositor does not request a copy of a Form 10-K, the Securities
Administrator shall be entitled to assume that such Form 10-K is in final form
and the Securities Administrator may proceed with the execution and filing
of
the Form 10-K. A senior officer of the Master Servicer in charge of the master
servicing function shall sign the Form 10-K. If a Form 10-K cannot be filed
on
time or if a previously filed Form 10-K needs to be amended, the Securities
Administrator will follow the procedures set forth in Section 5.06(c)(ii).
Promptly (but no later than 1 Business Day) after filing with the Commission,
the Securities Administrator will make available on its internet website a
final
executed copy of each Form 10-K prepared and filed by the Securities
Administrator. The parties to this Agreement acknowledge that the performance
by
the Master Servicer and the Securities Administrator of their respective duties
under this Section 5.06(d) related to the timely preparation, execution and
filing of Form 10-K is contingent upon such parties (and any Additional Servicer
or Servicing Function Participant) strictly observing all applicable deadlines
in the performance of their duties under this Section 5.06(d), Section 3.17,
Section 3.18, Section 3.20, Section 4.16, Section 4.17 and Section 4.18. Neither
the Master Servicer nor the Securities Administrator shall have any liability
for any loss, expense, damage or claim arising out of or with respect to any
failure to properly prepare, execute and/or timely file such Form 10-K, where
such failure results from the Securities Administrator’s inability or failure to
receive, on a timely basis, any information from any other party hereto needed
to prepare, arrange for execution or file such Form 10-K, not resulting from
its
own negligence, bad faith or willful misconduct.
(e) Each
of
Form 10-D and Form 10-K requires the registrant to indicate (by checking “yes”
or “no”) that it “(1) has filed all reports required to be filed by Section 13
or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter
period that the registrant was required to file such reports), and (2) has
been
subject to such filing requirements for the past 90 days.” The Depositor hereby
represents to the Securities Administrator that the Depositor has filed all
such
required reports during the preceding 12 months and that it has been subject
to
such filing requirement for the past 90 days. The Depositor shall notify the
Securities Administrator in writing, no later than the fifth calendar day after
the related Distribution Date with respect to the filing of a report on Form
10-D and no later than March 15th with respect to the filing of a report on
Form
10-K, if the answer to the question should be “no” as a result of filings that
relate to other securitization transactions of the Depositor for which the
Securities Administrator does not have the obligation to prepare and file
Exchange Act reports.
(f) The
Securities Administrator shall indemnify and hold harmless the Depositor, the
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 5.06 or the Master Servicer’s negligence, bad faith or willful
misconduct in connection therewith.
174
(g) Notwithstanding
the provisions of Section 12.01, this Section 5.06 may be amended without the
consent of the Certificateholders.
SECTION
5.07. Supplemental
Interest Trust.
(a) On
the
Closing Date, the Securities Administrator shall establish and maintain in
the
name of the Trustee a separate account for the benefit of the holders of the
Offered Certificates (the “Supplemental Interest Trust”). The Supplemental
Interest Trust shall be an Eligible Account, and funds on deposit therein shall
be held separate and apart from, and shall not be commingled with, any other
moneys, including, without limitation, other moneys of the Trustee or of the
Securities Administrator held pursuant to this Agreement.
(b) On
the
Business Day prior to each Distribution Date, the Securities Administrator
shall
deposit into the Supplemental Interest Trust amounts distributable to the Swap
Provider by the Supplemental Interest Trust pursuant to Section 5.01(c)(2),
(3), (5) and (6) and Section 5.01(c)(7)(vii)
of this
Agreement and shall distribute such amounts on the Business Day prior to such
Distribution Date in accordance with the foregoing sections.
(c) On
the
Business Day prior to each Distribution Date, the Securities Administrator
shall
deposit into the Supplemental Interest Trust amounts received by it from the
Swap Provider and shall distribute from the Supplemental Interest Trust on
the
Distribution Date an amount equal to the amount of any Net Swap Payment received
from the Swap Provider under the Swap Agreement in the order of priority set
forth in Section 5.01.
(d) The
Supplemental Interest Trust constitutes an “outside reserve fund” within the
meaning of Treasury Regulation § 1.860G-2(h) and is not an asset of any REMIC.
The Holders of the Class CE Certificates shall be the beneficial owner of the
Supplemental Interest Trust, subject to the power of the Securities
Administrator to transfer amounts under this Agreement. The Securities
Administrator shall keep records that accurately reflect the funds on deposit
in
the Supplemental Interest Trust. The Securities Administrator shall, at the
written direction of the majority of the Class CE Certificateholders, invest
amounts on deposit in the Supplemental Interest Trust in Permitted Investments.
In the absence of written direction to the Securities Administrator from the
majority of the Class CE Certificateholders, all funds in the Supplemental
Interest Trust shall remain uninvested. On each Distribution Date, the
Securities Administrator shall distribute, not in respect of any REMIC, any
interest earned on the Supplemental Interest Trust to the Holders of the Class
CE Certificates.
(e) For
federal income tax purposes, amounts paid to the Supplemental Interest Trust
on
each Distribution Date pursuant to Section 5.01(c)(2), (3), (5) and (6) and
Section 5.01(c)(7)(vii) shall first be deemed paid to the Supplemental
Interest Trust in respect of the Class IO Interest to the extent of the amount
distributable on such Class IO Interest on such Distribution Date, and any
remaining amount shall be deemed paid to the Supplemental Interest Trust in
respect of a Class IO Distribution Amount. It is the intention of the parties
hereto that, for federal and state income and state and local franchise tax
purposes, the Supplemental Interest Trust be disregarded as an entity separate
from the Holder of the Class CE Certificates unless and until the date when
either (a) there is more than one Class CE Certificateholder or (b) any Class
of
Certificates in addition to the Class CE Certificates is recharacterized as
an
equity interest in the Supplemental Interest Trust for federal income tax
purposes, in which case it is the intention of the parties hereto that, for
federal and state income and state and local franchise tax purposes, the
Supplemental Interest Trust be treated as a partnership. The Master Servicer
shall not be required to prepare and file partnership tax returns in respect
of
such partnership unless it receives additional reasonable compensation (not
to
exceed $10,000 per year) for the preparation of such filings, written
notification recognizing the creation of a partnership agreement or comparable
documentation evidencing the partnership.
175
(f) The
Securities Administrator shall treat the Holders of Certificates (other than
the
Class P, Class CE and Class R Certificates) as having entered into a notional
principal contract with respect to the Holders of the Class CE Certificates.
Pursuant to each such notional principal contract, all Holders of Certificates
(other than the Class P, Class CE and Class R Certificates) shall be treated
as
having agreed to pay, on each Distribution Date, to the Holder of the Class
CE
Certificates an aggregate amount equal to the excess, if any, of (i) the amount
payable on such Distribution Date on the REMIC III Regular Interest ownership
of
which is represented by such Class of Certificates over (ii) the amount payable
on such Class of Certificates on such Distribution Date (such excess, a “Class
IO Distribution Amount”). A Class IO Distribution Amount payable from interest
collections shall be allocated pro rata among such Certificates based on the
amount of interest otherwise payable to such Certificates, and a Class IO
Distribution Amount payable from principal collections shall be allocated to
the
most subordinate Class of such Certificates with an outstanding principal
balance to the extent of such balance. In addition, pursuant to such notional
principal contract, the Holder of the Class CE Certificates shall be treated
as
having agreed to pay Net WAC Rate Carryover Amounts to the Holders of the
Certificates (other than the Class CE, Class P and Class R Certificates) in
accordance with the terms of this Agreement. Any payments to such Certificates
from amounts deemed received in respect of this notional principal contract
shall not be payments with respect to a Regular Interest in a REMIC within
the
meaning of Code Section 860G(a)(1). However, any payment from the Certificates
(other than the Class CE, Class P and Class R Certificates) of a Class IO
Distribution Amount shall be treated for tax purposes as having been received
by
the Holders of such Certificates in respect of the REMIC III Regular Interest
ownership of which is represented by such Certificates, and as having been
paid
by such Holders to the Supplemental Interest Trust pursuant to the notional
principal contract. Thus, each Certificate (other than the Class P Certificates
and Class R Certificates) shall be treated as representing not only ownership
of
a Regular Interest in REMIC III, but also ownership of an interest in, and
obligations with respect to, a notional principal contract.
(g) For
federal tax return and information reporting, the right of the Class A
Certificateholders and the Mezzanine Certificateholders to receive payments
from
the Supplemental Interest Trust and the Reserve Fund in respect of any Net
WAC
Rate Carryover Amount shall be assigned a value of $146,000.
176
(h) Upon
a
Swap Early Termination other than in connection with the optional termination
of
the trust, the Securities Administrator on behalf of the Supplemental Interest
Trust, at the direction f the Depositor, will use reasonable efforts to appoint
a successor swap provider to enter into a new interest rate swap agreement
on
terms substantially similar to the Swap Agreement, with a successor swap
provider meeting all applicable eligibility requirements. If the Securities
Administrator receives a Swap Termination Payment from the Swap Provider in
connection with such Swap Early Termination, the Securities Administrator will
apply such Swap Termination Payment to any upfront payment required to appoint
the successor swap provider. If the Securities Administrator is required to
pay
a Swap Termination Payment to the Swap Provider in connection with such Swap
Early Termination, the Securities Administrator will apply any upfront payment
received from the successor swap provider to pay such Swap Termination Payment.
If
the
Securities Administrator is unable to appoint a successor swap provider within
30 days of the Swap Early Termination, then the Securities Administrator will
deposit any Swap Termination Payment received from the original Swap Provider
into a separate, non-interest bearing reserve account and will, on each
subsequent Distribution Date, withdraw from the amount then remaining on deposit
in such reserve account an amount equal to the Net Swap Payment, if any, that
would have been paid to the Securities Administrator by the original Swap
Provider calculated in accordance with the terms of the original Swap Agreement,
and distribute such amount in accordance with the terms of this
Agreement.
(i) In
the
event that the Swap Provider fails to perform any of its obligations under
the
Swap Agreement (including, without limitation, its obligation to make any
payment or transfer collateral), or breaches any of its representations and
warranties thereunder, or in the event that an Event of Default, Termination
Event, or Additional Termination Event (each as defined in the Swap Agreement)
occurs with respect to the Swap Agreement, the Securities Administrator on
behalf of the Supplemental Interest Trust Trustee shall immediately, but no
later than the next Business Day following such failure or breach, notify the
Depositor and send any notices and make any demands, on behalf of the
Supplemental Interest Trust, in accordance with the Swap Agreement.
(j) In
the
event that the Swap Provider’s obligations are guaranteed by a third party under
a guaranty relating to the Swap Agreement (such guaranty the “Guaranty” and such
third party the “Guarantor”), then to the extent that the Swap Provider fails to
make any payment by the close of business on the day it is required to make
payment under the terms of the Swap Agreement, the Securities Administrator
on
behalf of the Supplemental Interest Trust Trustee shall, as soon as practicable,
but no later than two (2) business days after the Swap Provider’s failure to
pay, demand that the Guarantor make any and all payments then required to be
made by the Guarantor pursuant to such Guaranty; provided, that the Securities
Administrator shall in no event be liable for any failure or delay in the
performance by the Swap Provider or any Guarantor of its obligations hereunder
or pursuant to the Swap Agreement and the Guaranty, nor for any special,
indirect or consequential loss or damage of any kind whatsoever (including
but
not limited to lost profits) in connection therewith.
177
SECTION
5.08. Tax
Treatment of Swap Payments and Swap Termination Payments.
(a) For
federal income tax purposes, each holder of an Offered Certificate is deemed
to
own an undivided beneficial ownership interest in a REMIC Regular Interest
and
the right to receive payments from either the Reserve Fund or the Supplemental
Interest Trust in respect of any Net WAC Rate Carryover Amounts or the
obligation to make payments to the Supplemental Interest Trust. For federal
income tax purposes, the Securities Administrator will account for payments
to
each Offered Certificate as follows: each Offered Certificate will be treated
as
receiving their entire payment from REMIC III (regardless of any Swap
Termination Payment or obligation under the Swap Agreement) and subsequently
paying their portion of any Swap Termination Payment in respect of each such
Class’s obligation under the Swap Agreement. In the event that any such Class is
resecuritized in a REMIC, the obligation under the Swap Agreement to pay any
such Swap Termination Payment (or any shortfall in Net Swap Payment), will
be
made by one or more of the REMIC Regular Interests issued by the
resecuritization REMIC subsequent to such REMIC Regular Interest receiving
its
full payment from any such Offered Certificate.
(b) The
REMIC
Regular Interest corresponding to an Offered Certificate will be entitled to
receive interest and principal payments at the times and in the amounts equal
to
those made on the certificate to which it corresponds, except that (i) the
maximum interest rate of that REMIC regular interest will equal the Net WAC
Pass-Through Rate computed for this purpose by limiting the Swap Notional Amount
of the Swap Agreement to the aggregate Stated Principal Balance of the Mortgage
Loans and (ii) any Swap Termination Payment will be treated as being payable
solely from amounts otherwise payable to the Class CE Certificates. As a result
of the foregoing, the amount of distributions and taxable income on the REMIC
Regular Interest corresponding to an Offered Certificate may exceed the actual
amount of distributions on the Offered Certificate.
SECTION
5.09. Swap
Collateral Account.
The
Securities Administrator is hereby directed to perform the obligations of the
Custodian as defined under the Swap Credit Support Annex (the “Swap Custodian”).
On
or
before the Closing Date, the Swap Custodian shall establish a Swap Collateral
Account. The Swap Collateral Account shall be held in the name of the Swap
Custodian in trust for the benefit of the Offered Certificates. The Swap
Collateral Account shall be an Eligible Account and shall be entitled “Swap
Collateral Account, Xxxxx Fargo Bank, National Association for the benefit
of
holders of ACE Securities Corp. Home Equity Loan Trust, Series 2007-WM2, Asset
Backed Pass-Through Certificates.”
The
Swap
Custodian shall credit to the Swap Collateral Account all collateral (whether
in
the form of cash or securities) posted by the Swap Provider to secure the
obligations of the Swap Provider in accordance with the terms of the Swap
Agreement. Except for investment earnings, the Swap Provider shall not have
any
legal, equitable or beneficial interest in the Swap Collateral Account other
than in accordance with the Swap Agreement and applicable law. The Swap
Custodian shall maintain and apply all collateral and earnings thereon on
deposit in the Swap Collateral Account in accordance with Swap Credit Support
Annex.
178
Cash
collateral posted by the Swap Provider in accordance with the Swap Credit
Support Annex shall be invested at the direction of the Swap Provider in
Permitted Investments in accordance with the requirements of the Swap Credit
Support Annex. All amounts earned on amounts on deposit in the Swap Collateral
Account (whether cash collateral or securities) shall be for the account of
and
taxable to the Swap Provider. If no investment direction is provided, funds
will
be held uninvested.
Upon
the
occurrence of an Event of Default or Specified Condition (each as defined in
the
Swap Agreement) with respect to the Swap Provider or upon occurrence or
designation of an Early Termination Date (as defined in the Swap Agreement)
as a
result of any such Event of Default or Specified Condition with respect to
the
Swap Provider, and, in either such case, unless the Swap Provider has paid
in
full all of its Obligations (as defined in the Swap Credit Support Annex) that
are then due, then any collateral posted by the Swap Provider in accordance
with
the Swap Credit Support Annex shall be applied to the payment of any Obligations
due to Party B (as defined in the Swap Agreement) in accordance with the Swap
Credit Support Annex. Any excess amounts held in such Swap Collateral Account
after payment of all amounts owing to Party B under the Swap Agreement shall
be
withdrawn from the Swap Collateral Account and paid to the Swap Provider in
accordance with the Swap Credit Support Annex.
SECTION
5.10. Cap
Collateral Account
The
Securities Administrator is hereby directed to perform the obligations of the
Custodian as defined under the Cap Credit Support Annex (the “Cap Custodian”).
On
or
before the Closing Date, the Cap Custodian shall establish a Cap Collateral
Account with respect to each of the Cap Contracts (the “Cap Collateral
Account”). The Cap Collateral Account shall be held in the name of the Cap
Custodian in trust for the benefit of the Class A Certificates and Mezzanine
Certificates. The Cap Collateral Account shall be an Eligible Account and shall
be entitled “Cap Collateral Account, Xxxxx Fargo Bank, National Association for
the benefit of holders of ACE Securities Corp. Home Equity Loan Trust, Series
2007-WM2, Class A, Class M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class
M-6, Class M-7, Class M-8 and Class M-9.”
The
Cap
Custodian shall credit to the Cap Collateral Account all collateral (whether
in
the form of cash or securities) posted by the Cap Counterparty to secure the
obligations of the Cap Counterparty in accordance with the terms of the related
Cap Contract. Except for investment earnings, the Cap Counterparty shall not
have any legal, equitable or beneficial interest in the Cap Collateral Account
other than in accordance with the related Cap Contract and applicable law.
The
Cap Custodian shall maintain and apply all collateral and earnings thereon
on
deposit in any Cap Collateral Account in accordance with the Cap Credit Support
Annex.
179
Cash
collateral posted by the Cap Counterparty in accordance with the related Cap
Credit Support Annex shall be invested at the direction of the Cap Counterparty
in Permitted Investments in accordance with the requirements of the Cap Credit
Support Annex. All amounts earned on amounts on deposit in a Cap Collateral
Account (whether cash collateral or securities) shall be for the account of
and
taxable to the Cap Counterparty. If no investment direction is provided, funds
will be held uninvested.
Upon
the
occurrence of an Event of Default or a Specified Condition (each as defined
in
the related Cap Contract) with respect to the Cap Counterparty or upon
occurrence or designation of an Early Termination Date (as defined in the
related Cap Contract) as a result of any such Event of Default or Specified
Condition with respect to the Cap Counterparty, and, in either such case, unless
the Cap Counterparty has paid in full all of its Obligations (as defined in
the
related Cap Credit Support Annex) that are then due, then any collateral posted
by the Cap Counterparty in accordance with the related Cap Credit Support Annex
shall be applied to the payment of any Obligations due to Party B (as defined
in
the related Cap Contract) in accordance with the related Cap Credit Support
Annex. Any excess amounts held in such Cap Collateral Account after payment
of
all amounts owing to Party B under the related Cap Contract shall be withdrawn
from the Cap Collateral Account and paid to the Cap Counterparty in accordance
with the related Cap Credit Support Annex.
180
ARTICLE
VI
THE
CERTIFICATES
SECTION
6.01. The
Certificates.
(a) The
Certificates in the aggregate will represent the entire beneficial ownership
interest in the Mortgage Loans and all other assets included in REMIC I, REMIC
II and REMIC III.
The
Certificates will be substantially in the forms annexed hereto as Exhibits
A-1
through A-5. The Certificates of each Class will be issuable in registered
form
only, in denominations of authorized Percentage Interests as described in the
definition thereof. Each Certificate will share ratably in all rights of the
related Class.
Upon
original issue, the Certificates shall be executed and authenticated by the
Securities Administrator and delivered by the Trustee to and upon the written
order of the Depositor. The Certificates shall be executed by manual or
facsimile signature on behalf of the Trust by the Securities Administrator
by an
authorized signatory. Certificates bearing the manual or facsimile signatures
of
individuals who were at any time the proper officers of the Securities
Administrator shall bind the Trust, notwithstanding that such individuals or
any
of them have ceased to hold such offices prior to the authentication and
delivery of such Certificates or did not hold such offices at the date of such
Certificates. No Certificate shall be entitled to any benefit under this
Agreement or be valid for any purpose, unless there appears on such Certificate
a certificate of authentication substantially in the form provided herein
executed by the Securities Administrator by manual signature, and such
certificate of authentication shall be conclusive evidence, and the only
evidence, that such Certificate has been duly authenticated and delivered
hereunder. All Certificates shall be dated the date of their
authentication.
(b) The
Class
A Certificates and the Mezzanine Certificates shall initially be issued as
one
or more Certificates held by the Book-Entry Custodian or, if appointed to hold
such Certificates as provided below, the Depository and registered in the name
of the Depository or its nominee and, except as provided below, registration
of
such Certificates may not be transferred by the Securities Administrator except
to another Depository that agrees to hold such Certificates for the respective
Certificate Owners with Ownership Interests therein. The Certificate Owners
shall hold their respective Ownership Interests in and to such Certificates
through the book-entry facilities of the Depository and, except as provided
below, shall not be entitled to definitive, fully registered Certificates
(“Definitive Certificates”) in respect of such Ownership Interests. All
transfers by Certificate Owners of their respective Ownership Interests in
the
Book-Entry Certificates shall be made in accordance with the procedures
established by the Depository Participant or brokerage firm representing such
Certificate Owner. Each Depository Participant shall only transfer the Ownership
Interests in the Book-Entry Certificates of Certificate Owners it represents
or
of brokerage firms for which it acts as agent in accordance with the
Depository’s normal procedures. The Securities Administrator is hereby initially
appointed as the Book-Entry Custodian and hereby agrees to act as such in
accordance herewith and in accordance with the agreement that it has with the
Depository authorizing it to act as such. The Book-Entry Custodian may, and,
if
it is no longer qualified to act as such, the Book-Entry Custodian shall,
appoint, by a written instrument delivered to the Depositor, the Servicer and,
if the Trustee is not the Book-Entry Custodian, the Trustee, any other transfer
agent (including the Depository or any successor Depository) to act as
Book-Entry Custodian under such conditions as the predecessor Book-Entry
Custodian and the Depository or any successor Depository may prescribe, provided
that the predecessor Book-Entry Custodian shall not be relieved of any of its
duties or responsibilities by reason of any such appointment of other than
the
Depository. If the Securities Administrator resigns or is removed in accordance
with the terms hereof, the successor Securities Administrator or, if it so
elects, the Depository shall immediately succeed to its predecessor’s duties as
Book-Entry Custodian. The Depositor shall have the right to inspect, and to
obtain copies of, any Certificates held as Book-Entry Certificates by the
Book-Entry Custodian.
181
(c) The
Class
CE Certificates initially offered and sold in offshore transactions in reliance
on Regulation S shall be issued in the form of a temporary global certificate
in
definitive, fully registered form (each, a “Regulation S Temporary Global
Certificate”), which shall be deposited with the Securities Administrator or an
agent of the Securities Administrator as custodian for the Depository and
registered in the name of Cede & Co. as nominee of the Depository for the
account of designated agents holding on behalf of Euroclear or Clearstream.
Beneficial interests in each Regulation S Temporary Global Certificate may
be
held only through Euroclear or Clearstream; provided, however, that such
interests may be exchanged for interests in a Definitive Certificate in
accordance with the requirements described in Section 6.02. After the expiration
of the Release Date, a beneficial interest in a Regulation S Temporary Global
Certificate may be exchanged for a beneficial interest in the related permanent
global certificate of the same Class (each, a “Regulation S Permanent Global
Certificate”), in accordance with the procedures set forth in Section 6.02. Each
Regulation S Permanent Global Certificate shall be deposited with the Securities
Administrator or an agent of the Securities Administrator as custodian for
the
Depository and registered in the name of Cede & Co. as nominee of the
Depository.
The
Class
CE Certificates and Class P Certificates offered and sold to QIBs in reliance
on
Rule 144A will be issued in the form of Definitive Certificates.
(d) The
Trustee, the Servicer, the Securities Administrator, the Master Servicer and
the
Depositor may for all purposes (including the making of payments due on the
Book-Entry Certificates and Global Certificates) deal with the Depository as
the
authorized representative of the Certificate Owners with respect to the
Book-Entry Certificates and Global Certificates for the purposes of exercising
the rights of Certificateholders hereunder. The rights of Certificate Owners
with respect to the Book-Entry Certificates and Global Certificates shall be
limited to those established by law and agreements between such Certificate
Owners and the Depository Participants and brokerage firms representing such
Certificate Owners. Multiple requests and directions from, and votes of, the
Depository as Holder of the Book-Entry Certificates and Global Certificates
with
respect to any particular matter shall not be deemed inconsistent if they are
made with respect to different Certificate Owners. The Securities Administrator
may establish a reasonable record date in connection with solicitations of
consents from or voting by Certificateholders and shall give notice to the
Depository of such record date.
182
If
(i)(A)
the Depositor advises the Securities Administrator in writing that the
Depository is no longer willing or able to properly discharge its
responsibilities as Depository, and (B) the Depositor is unable to locate a
qualified successor, (ii) the Depositor at its option advises the Securities
Administrator in writing that it elects to terminate the book-entry system
through the Depository or (iii) after the occurrence of a Servicer Event of
Default, Certificate Owners representing in the aggregate not less than 51%
of
the Ownership Interests of the Book-Entry Certificates advise the Securities
Administrator through the Depository, in writing, that the continuation of
a
book-entry system through the Depository is no longer in the best interests
of
the Certificate Owners, the Securities Administrator shall notify all
Certificate Owners, through the Depository, of the occurrence of any such event
and of the availability of Definitive Certificates to Certificate Owners
requesting the same. With respect to a Global Certificate, the related
Certificate Owner (other than a Holder of a Regulation S Temporary Global
Certificate) may request that its interest in a Global Certificate be exchanged
for a Definitive Certificate. Upon surrender to the Securities Administrator
of
the Book-Entry Certificates by the Book-Entry Custodian or the Depository,
as
applicable, or the Global Certificates by the Depository accompanied by
registration instructions from the Depository for registration of transfer,
the
Securities Administrator shall cause the Definitive Certificates to be issued.
Such Definitive Certificates will be issued in minimum denominations of $10,000
except that any beneficial ownership that was represented by a Book-Entry
Certificate, or a Global Certificate, as applicable in an amount less than
$10,000 immediately prior to the issuance of a Definitive Certificate shall
be
issued in a minimum denomination equal to the amount represented by such
Book-Entry Certificate or a Global Certificate, as applicable. None of the
Depositor, the Servicer, the Master Servicer, the Securities Administrator
or
the Trustee shall be liable for any delay in the delivery of such instructions
and may conclusively rely on, and shall be protected in relying on, such
instructions. Upon the issuance of Definitive Certificates all references herein
to obligations imposed upon or to be performed by the Depository shall be deemed
to be imposed upon and performed by the Securities Administrator, to the extent
applicable with respect to such Definitive Certificates, and the Securities
Administrator shall recognize the Holders of the Definitive Certificates as
Certificateholders hereunder.
SECTION
6.02. Registration
of Transfer and Exchange of Certificates.
(a) The
Securities Administrator shall cause to be kept at one of the offices or
agencies to be appointed by the Securities Administrator in accordance with
the
provisions of Section 9.11, a Certificate Register for the Certificates in
which, subject to such reasonable regulations as it may prescribe, the
Securities Administrator shall provide for the registration of Certificates
and
of transfers and exchanges of Certificates as herein provided.
(b) No
transfer of any Class CE Certificate, Class P Certificate or Residual
Certificate shall be made unless that transfer is made pursuant to an effective
registration statement under the Securities Act, and effective registration
or
qualification under applicable state securities laws, or is made in a
transaction that does not require such registration or qualification.
In
the
event that such a transfer of a Class CE Certificate or Class P Certificate
is
to be made without registration or qualification (other than in connection
with
the initial transfer of any such Certificate by the Depositor), the Securities
Administrator shall require receipt of: (i) if such transfer is purportedly
being made in reliance upon Rule 144A under the Securities Act, written
certifications from the Certificateholder desiring to effect the transfer and
from such Certificateholder’s prospective transferee, substantially in the form
attached hereto as Exhibit B-1; (ii) if such transfer is purportedly being
made
in reliance upon Rule 501(a) under the Securities Act, written certifications
from the Certificateholder desiring to effect the transfer and from such
Certificateholder’s prospective transferee, substantially in the form attached
hereto as Exhibit B-3, (iii) if such transfer is purportedly being made in
reliance on Regulation S, a written certification from the prospective
transferee, substantially in the form attached hereto as Exhibit B-2 and (iv)
in
all other cases, an Opinion of Counsel satisfactory to the Securities
Administrator that such transfer may be made without such registration or
qualification (which Opinion of Counsel shall not be an expense of the Trust
Fund or of the Depositor, the Trustee, the Master Servicer, the Securities
Administrator or the Servicers), together with copies of the written
certification(s) of the Certificateholder desiring to effect the transfer and/or
such Certificateholder’s prospective transferee upon which such Opinion of
Counsel is based, if any.
183
A
holder
of a beneficial interest in a Regulation S Temporary Global Certificate must
provide Euroclear or Clearstream, as the case may be, with a certificate in
the
form of Annex A to Exhibit B-2 hereto certifying that the beneficial owner
of
the interest in such Global Certificate is not a U.S. Person (as defined in
Regulation S), and Euroclear or Clearstream, as the case may be, must provide
to
the Securities Administrator a certificate in the form of Exhibit B-2 hereto
prior to (i) the payment of interest or principal with respect to such holder’s
beneficial interest in the Regulation S Temporary Global Certificate and (ii)
any exchange of such beneficial interest for a beneficial interest in a
Regulation S Permanent Global Certificate.
In
the
event that such a transfer of a Class CE Certificate or Class P Certificate
is
to be made without registration or qualification (other than in connection
with
the initial transfer of any such Certificate by the Depositor), the Securities
Administrator shall require receipt of: (i) if such transfer is purportedly
being made in reliance upon Rule 144A under the Securities Act, written
certifications from the Certificateholder desiring to effect the transfer and
from such Certificateholder’s prospective transferee, substantially in the form
attached hereto as Exhibit B-1; (ii) if such transfer is purportedly being
made
in reliance upon Rule 501(a) under the Securities Act, written certifications
from the Certificateholder desiring to effect the transfer and from such
Certificateholder’s prospective transferee, substantially in the form attached
hereto as Exhibit B-3, (iii) if such transfer is purportedly being made in
reliance on Regulation S, a written certification from the prospective
transferee, substantially in the form attached hereto as Exhibit B-2 and (iv)
in
all other cases, an Opinion of Counsel satisfactory to the Securities
Administrator that such transfer may be made without such registration or
qualification (which Opinion of Counsel shall not be an expense of the Trust
Fund or of the Depositor, the Trustee, the Master Servicer, the Securities
Administrator or the Servicers), together with copies of the written
certification(s) of the Certificateholder desiring to effect the transfer and/or
such Certificateholder’s prospective transferee upon which such Opinion of
Counsel is based, if any.
A
holder
of a beneficial interest in a Regulation S Temporary Global Certificate must
provide Euroclear or Clearstream, as the case may be, with a certificate in
the
form of Annex A to Exhibit B-2 hereto certifying that the beneficial owner
of
the interest in such Global Certificate is not a U.S. Person (as defined in
Regulation S), and Euroclear or Clearstream, as the case may be, must provide
to
the Trustee and Securities Administrator a certificate in the form of Exhibit
B-2 hereto prior to (i) the payment of interest or principal with respect to
such holder’s beneficial interest in the Regulation S Temporary Global
Certificate and (ii) any exchange of such beneficial interest for a beneficial
interest in a Regulation S Permanent Global Certificate.
184
In
the
event that such a transfer of a Residual Certificate is to be made without
registration or qualification (other than in connection with the initial
transfer of any such Certificate by the Depositor), the Securities Administrator
shall require receipt of: (i) if such transfer is purportedly being made in
reliance upon Rule 144A under the Securities Act, written certifications from
the Certificateholder desiring to effect the transfer and from such
Certificateholder’s prospective transferee, substantially in the form attached
hereto as Exhibit B-1; (ii) if such transfer is purportedly being made in
reliance upon Rule 501(a) under the Securities Act, written certifications
from
the Certificateholder desiring to effect the transfer and from such
Certificateholder’s prospective transferee, substantially in the form attached
hereto as Exhibit B-3, and (iv) in all other cases, an Opinion of Counsel
satisfactory to the Securities Administrator that such transfer may be made
without such registration or qualification (which Opinion of Counsel shall
not
be an expense of the Trust Fund or of the Depositor, the Trustee, the Master
Servicer, the Securities Administrator or the Servicers), together with copies
of the written certification(s) of the Certificateholder desiring to effect
the
transfer and/or such Certificateholder’s prospective transferee upon which such
Opinion of Counsel is based, if any.
Neither
of the Depositor nor the Securities Administrator is obligated to register
or
qualify any such Certificates under the Securities Act or any other securities
laws or to take any action not otherwise required under this Agreement to permit
the transfer of such Certificates without registration or qualification. Any
Certificateholder desiring to effect the transfer of any such Certificate shall,
and does hereby agree to, indemnify the Trustee, the Depositor, the Master
Servicer, the Securities Administrator 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.
(c) No
transfer of a Class CE Certificate, Class P Certificate or a Residual
Certificate or any interest therein shall be made to any Plan, any Person
acting, directly or indirectly, on behalf of any such Plan or any Person
acquiring such Certificates with “Plan Assets” of a Plan within the meaning of
the Department of Labor regulation promulgated at 29 C.F.R. § 2510.3-101 as
modified by Section 3(42) of ERISA (“Plan Assets”) unless the Securities
Administrator is provided with an Opinion of Counsel on which the Depositor,
the
Master Servicer, the Securities Administrator, the Trustee and the Servicers
may
rely, which establishes to the satisfaction of the Securities Administrator
that
the purchase of such Certificates is permissible under applicable law, will
not
constitute or result in any prohibited transaction under ERISA or
Section 4975 of the Code and will not subject the Depositor, the Servicers,
the Trustee, the Master Servicer, the Securities Administrator or the Trust
Fund
to any obligation or liability (including obligations or liabilities under
ERISA
or Section 4975 of the Code) in addition to those undertaken in this
Agreement, which Opinion of Counsel shall not be an expense of the Depositor,
the Servicers, the Trustee, the Master Servicer, the Securities Administrator,
the Trust Fund. An Opinion of Counsel will not be required in connection with
the initial transfer of any such Certificate by the Depositor to an affiliate
of
the Depositor (in which case, the Depositor or any affiliate thereof shall
have
deemed to have represented that such affiliate is not a Plan or a Person
investing Plan Assets) and the Securities Administrator shall be entitled to
conclusively rely upon a representation (which, upon the request of the
Securities Administrator, shall be a written representation) from the Depositor
of the status of such transferee as an affiliate of the Depositor.
185
For
so
long as the Supplemental Interest Trust is in existence, each beneficial owner
of an Offered Certificate, or any interest therein, shall be deemed to have
represented, by virtue of its acquisition or holding of the Offered Certificate,
or interest therein, that either (i) it is not a Plan or (ii)(A) it is an
accredited investor within the meaning of Prohibited Transaction Exemption
2007-05, as amended from time to time (the “Exemption”) and (B) the acquisition
and holding of such Certificate and the separate right to receive payments
from
the Supplemental Interest Trust are eligible for the exemptive relief available
under Prohibited Transaction Class Exemption (“PTCE”) 84-14 (for transactions by
independent “qualified professional asset managers”), 91-38 (for transactions by
bank collective investment funds), 90-1 (for transactions by insurance company
pooled separate accounts), 95-60 (for transactions by insurance company general
accounts) or 96-23 (for transactions effected by “in-house asset
managers”).
Each
Transferee of a Mezzanine Certificate or any interest therein that is acquired
after the termination of the Supplemental Interest Trust will be deemed to
have
represented by virtue of its purchase or holding of such Certificate (or
interest therein) that either (a) such Transferee is not a Plan or purchasing
such Certificate with Plan Assets, (b) it has acquired and is holding such
Certificate in reliance on the Exemption, and that it understands that there
are
certain conditions to the availability of the Exemption including that such
Certificate must be rated, at the time of purchase, not lower than “BBB-” (or
its equivalent) by a rating agency recognized under the Exemption or (c) the
following conditions are satisfied: (i) such Transferee is an insurance company,
(ii) the source of funds used to purchase or hold such Certificate (or interest
therein) is an “insurance company general account” (as defined in PTCE 95-60,
and (iii) the conditions set forth in Sections I and III of PTCE 95-60 have
been
satisfied.
If
any
Certificate or any interest therein is acquired or held in violation of the
conditions described in this Section 6.02(c), the next preceding permitted
beneficial owner will be treated as the beneficial owner of that Certificate,
retroactive to the date of transfer to the purported beneficial owner. Any
purported beneficial owner whose acquisition or holding of any certificate
or
interest therein was effected in violation of the conditions described in this
Section 6.02(c) shall indemnify and hold harmless the Depositor, the
Trustee, the Servicers, the Master Servicer, the Securities Administrator and
the Trust Fund from and against any and all liabilities, claims, costs or
expenses incurred by those parties as a result of that acquisition or
holding.
(d)
Each
Person who has or who acquires any Ownership Interest in a Residual Certificate
shall be deemed by the acceptance or acquisition of such Ownership Interest
to
have agreed to be bound by the following provisions and to have irrevocably
authorized the Securities Administrator or its designee under clause (iii)(A)
below to deliver payments to a Person other than such Person and to negotiate
the terms of any mandatory sale under clause (iii)(B) below and to execute
all
instruments of Transfer and to do all other things necessary in connection
with
any such sale. The rights of each Person acquiring any Ownership Interest in
a
Residual Certificate are expressly subject to the following
provisions:
186
(A) Each
Person holding or acquiring any Ownership Interest in a Residual 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.
(B) In
connection with any proposed Transfer of any Ownership Interest in a Residual
Certificate, the Securities Administrator shall require delivery to it, and
shall not register the Transfer of any Residual Certificate until its receipt
of, an affidavit and agreement (a “Transfer Affidavit and Agreement,” in the
form attached hereto as Exhibit B-4) from the proposed Transferee, in form
and
substance satisfactory to the Securities Administrator, representing and
warranting, among other things, that such Transferee is a Permitted Transferee,
that it is not acquiring its Ownership Interest in the Residual Certificate
that
is the subject of the proposed Transfer as a nominee, trustee or agent for
any
Person that is not a Permitted Transferee, that for so long as it retains its
Ownership Interest in a Residual Certificate, it will endeavor to remain a
Permitted Transferee, and that it has reviewed the provisions of this
Section 6.02(d) and agrees to be bound by them.
(C) Notwithstanding
the delivery of a Transfer Affidavit and Agreement by a proposed Transferee
under clause (B) above, if an authorized officer of the Securities Administrator
who is assigned to this transaction has actual knowledge that the proposed
Transferee is not a Permitted Transferee, no Transfer of an Ownership Interest
in a Residual Certificate to such proposed Transferee shall be
effected.
(D) Each
Person holding or acquiring any Ownership Interest in a Residual Certificate
shall agree (x) to require a Transfer Affidavit and Agreement from any other
Person to whom such Person attempts to transfer its Ownership Interest in a
Residual Certificate and (Y) not to transfer its Ownership Interest unless
it
provides a Transferor Affidavit (in the form attached hereto as Exhibit B-4)
to
the Securities Administrator stating that, among other things, it has no actual
knowledge that such other Person is not a Permitted Transferee.
(E) Each
Person holding or acquiring an Ownership Interest in a Residual Certificate,
by
purchasing an Ownership Interest in such Certificate, agrees to give the
Securities Administrator written notice that it is a “pass-through interest
holder” within the meaning of temporary Treasury regulation
Section 1.67-3T(a)(2)(i)(A) immediately upon acquiring an Ownership
Interest in a Residual Certificate, if it is, or is holding an Ownership
Interest in a Residual Certificate on behalf of, a “pass-through interest
holder.”
(ii) The
Securities Administrator will register the Transfer of any Residual Certificate
only if it shall have received the Transfer Affidavit and Agreement and all
of
such other documents as shall have been reasonably required by the Securities
Administrator as a condition to such registration. In addition, no Transfer
of a
Residual Certificate shall be made unless the Securities Administrator shall
have received a representation letter from the Transferee of such Certificate
to
the effect that such Transferee is a Permitted Transferee.
187
(iii) (A)
If
any purported Transferee shall become a Holder of a Residual Certificate in
violation of the provisions of this Section 6.02(d), then the last
preceding Permitted Transferee shall be restored, to the extent permitted by
law, to all rights as holder thereof retroactive to the date of registration
of
such Transfer of such Residual Certificate. The Securities Administrator shall
be under no liability to any Person for any registration of Transfer of a
Residual Certificate that is in fact not permitted by this Section 6.02(d)
or for making any payments due on such Certificate to the holder thereof or
for
taking any other action with respect to such holder under the provisions of
this
Agreement.
(B) If
any
purported Transferee shall become a holder of a Residual Certificate in
violation of the restrictions in this Section 6.02(d) and to the extent
that the retroactive restoration of the rights of the holder of such Residual
Certificate as described in clause (iii)(A) above shall be invalid, illegal
or
unenforceable, then the Securities Administrator shall have the right, without
notice to the holder or any prior holder of such Residual Certificate, to sell
such Residual Certificate to a purchaser selected by the Securities
Administrator on such terms as the Securities Administrator may choose. Such
purported Transferee shall promptly endorse and deliver each Residual
Certificate in accordance with the instructions of the Securities Administrator.
Such purchaser may be the Securities Administrator itself or any Affiliate
of
the Securities Administrator. The proceeds of such sale, net of the commissions
(which may include commissions payable to the Securities Administrator or its
Affiliates), expenses and taxes due, if any, will be remitted by the Securities
Administrator to such purported Transferee. The terms and conditions of any
sale
under this clause (iii)(B) shall be determined in the sole discretion of the
Securities Administrator, and the Securities Administrator shall not be liable
to any Person having an Ownership Interest in a Residual Certificate as a result
of its exercise of such discretion.
(iv) The
Securities Administrator shall make available to the Internal Revenue Service
and those Persons specified by the REMIC Provisions all information necessary
to
compute any tax imposed (A) as a result of the Transfer of an Ownership Interest
in a Residual Certificate to any Person who is a Disqualified Organization,
including the information described in Treasury regulations sections
1.860D-1(b)(5) and 1.860E-2(a)(5) with respect to the “excess inclusions” of
such Residual Certificate and (B) as a result of any regulated investment
company, real estate investment trust, common trust fund, partnership, trust,
estate or organization described in Section 1381 of the Code that holds an
Ownership Interest in a Residual Certificate having as among its record holders
at any time any Person which is a Disqualified Organization. Reasonable
compensation for providing such information may be charged or collected by
the
Securities Administrator.
188
(v) The
provisions of this Section 6.02(d) set forth prior to this subsection (v)
may be modified, added to or eliminated, provided that there shall have been
delivered to the Securities Administrator at the expense of the party seeking
to
modify, add to or eliminate any such provision the following:
(A) written
notification from each Rating Agency to the effect that the modification,
addition to or elimination of such provisions will not cause such Rating Agency
to downgrade its then-current ratings of any Class of Certificates;
and
(B) an
Opinion of Counsel, in form and substance satisfactory to the Securities
Administrator, to the effect that such modification of, addition to or
elimination of such provisions will not cause any Trust REMIC to cease to
qualify as a REMIC and will not cause any Trust REMIC, as the case may be,
to be
subject to an entity-level tax caused by the Transfer of any Residual
Certificate to a Person that is not a Permitted Transferee or a Person other
than the prospective transferee to be subject to a REMIC-tax caused by the
Transfer of a Residual Certificate to a Person that is not a Permitted
Transferee.
(e) Subject
to the preceding subsections, upon surrender for registration of transfer of
any
Certificate at any office or agency of the Securities Administrator maintained
for such purpose pursuant to Section 9.11, the Securities Administrator
shall execute, authenticate and deliver, in the name of the designated
Transferee or Transferees, one or more new Certificates of the same Class of
a
like aggregate Percentage Interest.
(f) At
the
option of the Holder thereof, any Certificate may be exchanged for other
Certificates of the same Class with authorized denominations and a like
aggregate Percentage Interest, upon surrender of such Certificate to be
exchanged at any office or agency of the Securities Administrator maintained
for
such purpose pursuant to Section 9.11. 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 transfer or exchange shall (if so required by the Securities Administrator)
be duly endorsed by, or be accompanied by a written instrument of transfer
in
the form satisfactory to the Securities Administrator duly executed by, the
Holder thereof or his attorney duly authorized in writing. In addition, with
respect to each Class R Certificate, the holder thereof may exchange, in the
manner described above, such Class R Certificate for three separate
certificates, each representing such holder's respective Percentage Interest
in
the Class R-I Interest, the Class R-II Interest and the Class R-III Interest,
respectively, in each case that was evidenced by the Class R Certificate being
exchanged.
(g) No
transfer of any Class CE Certificate shall be made unless the proposed
transferee of such Class CE Certificate (1) provides to the Securities
Administrator the appropriate tax certification forms that would eliminate
any
withholding or deduction for taxes from amounts payable by the Cap Counterparty
and the Swap Provider to the Securities Administrator pursuant to the Cap
Contracts and the Swap Agreement (i.e., IRS Form W-9 or IRS Form X-0XXX, X-0XXX,
X-0XXX or W-8ECI, as applicable (or any successor form thereto), together with
any applicable attachments) and (2) agrees to update such forms (a) upon
expiration of any such form, (b) as required under then applicable U.S. Treasury
regulations and (c) promptly upon learning that any such form has become
obsolete or incorrect, each as a condition to such transfer so long as they
are
in physical form. In addition, no transfer of any Class CE Certificate shall
be
made if such transfer would cause the Reserve Fund or the Supplemental Interest
Trust to be beneficially owned by two or more persons for federal income tax
purposes, or continue to be so treated, unless (i) each proposed transferee
of
such Class CE Certificate complies with the foregoing conditions, (ii) the
proposed majority holder of the Class CE Certificates (or each holder, if there
is or would be no majority holder) (A) provides, or causes to be provided,
on
behalf of the Reserve Fund and the Supplemental Interest Trust, if applicable,
the appropriate tax certification form that would be required from the Reserve
Fund and the Supplemental Interest Trust to eliminate any withholding or
deduction for taxes from amounts payable by the Cap Counterparty and the Swap
Provider to the Securities Administrator pursuant to the Cap Contracts and
the
Swap Agreement (i.e., IRS Form W-9 or IRS Form X-0XXX, X-0XXX, X-0XXX or W-8ECI,
as applicable (or any successor form thereto), together with any applicable
attachments) and (B) agrees to update such forms (x) upon expiration of any
such
form, (y) as required under then applicable U.S. Treasury regulations and (z)
promptly upon learning that any such form has become obsolete or incorrect.
If,
under applicable U.S. Treasury regulations, such tax certification form may
only
be signed by a trustee acting on behalf of the Reserve Fund or the Supplemental
Interest Trust, then the Securities Administrator, the Trustee or the
Supplemental Interest Trust Trustee, as appropriate, shall sign such
certification form if so requested by a holder of the Class CE Certificates.
Upon receipt of any tax certification form pursuant to the preceding conditions
from a proposed transferee of any Class CE Certificate, the Securities
Administrator shall forward each tax certification form attributable to the
Cap
Contracts to the Cap Counterparty and each tax certification form attributable
to the Swap Agreement to the Swap Provider so long as the Securities
Administrator is permitted to provide such tax certification form. Each holder
of a Class CE Certificate and each transferee thereof shall be deemed to have
consented to the Securities Administrator forwarding to the Cap Counterparty
and
the Swap Provider any tax certification form it has provided and updated in
accordance with these transfer restrictions. Any purported sales or transfers
of
any Class CE Certificate to a transferee which does not comply with the
requirements of this paragraph shall be deemed null and void under this
Agreement. In the event that the Securities Administrator is unable to provide
a
tax certification pursuant to this paragraph, it shall immediately notify the
Depositor, the Swap Provider and the Cap Provider.
189
(h) No
service charge to the Certificateholders shall be made for any transfer or
exchange of Certificates, but the Securities Administrator may require 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.
(i) All
Certificates surrendered for transfer and exchange shall be canceled and
destroyed by the Securities Administrator in accordance with its customary
procedures.
SECTION
6.03. Mutilated,
Destroyed, Lost or Stolen Certificates.
If
(i)
any mutilated Certificate is surrendered to the Securities Administrator, or
the
Securities Administrator receives evidence to its satisfaction of the
destruction, loss or theft of any Certificate and of the ownership thereof,
and
(ii) there is delivered to the Securities Administrator such security or
indemnity as may be required by it to save it harmless, then, in the absence
of
actual knowledge by the Securities Administrator that such Certificate has
been
acquired by a protected purchaser, the Securities Administrator, shall execute,
authenticate and deliver, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Certificate, a new Certificate of the same Class
and
of like denomination and Percentage Interest. Upon the issuance of any new
Certificate under this Section, the Securities Administrator may require the
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in relation thereto and any other expenses (including the fees
and expenses of the Securities Administrator) connected therewith. Any
replacement Certificate issued pursuant to this Section shall constitute
complete and indefeasible evidence of ownership in the applicable REMIC created
hereunder, as if originally issued, whether or not the lost, stolen or destroyed
Certificate shall be found at any time.
190
SECTION
6.04. Persons
Deemed Owners.
The
Depositor, the Servicers, the Trustee, the Master Servicer, the Securities
Administrator and any agent of any of them may treat the Person in whose name
any Certificate is registered as the owner of such Certificate for the purpose
of receiving distributions pursuant to Section 5.01 and for all other
purposes whatsoever, and none of the Depositor, the Servicers, the Trustee,
the
Master Servicer, the Securities Administrator or any agent of any of them shall
be affected by notice to the contrary.
SECTION
6.05. Certain
Available Information.
On
or
prior to the date of the first sale of any Class CE Certificate, Class P
Certificate or Residual Certificate to an Independent third party, the Depositor
shall provide to the Securities Administrator ten copies of any private
placement memorandum or other disclosure document used by the Depositor in
connection with the offer and sale of such Certificate. In addition, if any
such
private placement memorandum or disclosure document is revised, amended or
supplemented at any time following the delivery thereof to the Securities
Administrator, the Depositor promptly shall inform the Securities Administrator
of such event and shall deliver to the Securities Administrator ten copies
of
the private placement memorandum or disclosure document, as revised, amended
or
supplemented. The Securities Administrator shall maintain at its office as
set
forth in Section 12.05 hereof and shall make available free of charge
during normal business hours for review by any Holder of a Certificate or any
Person identified to the Securities Administrator as a prospective transferee
of
a Certificate, originals or copies of the following items: (i) in the case
of a
Holder or prospective transferee of a Class CE Certificate, Class P Certificate
or Residual Certificate, the related private placement memorandum or other
disclosure document relating to such Class of Certificates, in the form most
recently provided to the Securities Administrator; and (ii) in all cases, (A)
this Agreement and any amendments hereof entered into pursuant to
Section 12.01, (B) all monthly statements required to be delivered to
Certificateholders of the relevant Class pursuant to Section 5.02 since the
Closing Date, and all other notices, reports, statements and written
communications delivered to the Certificateholders of the relevant Class
pursuant to this Agreement since the Closing Date and (C) any copies of all
Officers’ Certificates of
191
the
Servicer since the Closing Date delivered to the Master Servicer to evidence
such Person’s determination that any P&I Advance or Servicing Advance was,
or if made, would be a Nonrecoverable P&I Advance or Nonrecoverable
Servicing Advance. Copies and mailing of any and all of the foregoing items
will
be available from the Securities Administrator upon request at the expense
of
the Person requesting the same.
192
ARTICLE
VII
THE
DEPOSITOR, THE SERVICER AND THE MASTER SERVICER
SECTION
7.01. Liability
of the Depositor, the Servicer and the Master Servicer.
The
Depositor, the Servicer and the Master Servicer each shall be liable in
accordance herewith only to the extent of the obligations specifically imposed
by this Agreement upon them in their respective capacities as Depositor,
Servicer and Master Servicer and undertaken hereunder by the Depositor, the
Servicer and the Master Servicer herein.
SECTION
7.02. Merger
or
Consolidation of the Depositor, the Servicer or the Master Servicer.
Subject
to the following paragraph, the Depositor will keep in full effect its
existence, rights and franchises as a corporation under the laws of the
jurisdiction of its incorporation. Subject to the following paragraph, the
Servicer will keep in full effect its existence, rights and franchises as a
limited liability company under the laws of the jurisdiction of its formation.
Subject to the following paragraph, the Master Servicer will keep in full effect
its existence, rights and franchises as a national banking association. The
Depositor, the Servicer and the Master Servicer each will obtain and preserve
its qualification to do business as a foreign entity in each jurisdiction in
which such qualification is or shall be necessary to protect the validity and
enforceability of this Agreement, the Certificates or any of the Mortgage Loans
and to perform its respective duties under this Agreement.
The
Depositor, the Servicer or the Master Servicer may be merged or consolidated
with or into any Person, or transfer all or substantially all of its assets
to
any Person, in which case any Person resulting from any merger or consolidation
to which the Depositor, the Servicer or the Master Servicer shall be a party,
or
any Person succeeding to the business of the Depositor, the Servicer or the
Master Servicer, shall be the successor of the Depositor, the Servicer or the
Master Servicer, as the case may be, hereunder, without the execution or filing
of any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding; provided, however, that any
successor to the Servicer or the Master Servicer shall meet the eligibility
requirements set forth in clauses (i) and (iii) of the last paragraph of Section
8.02(a) or Section 7.06, as applicable.
SECTION
7.03. Limitation
on Liability of the Depositor, the Servicer, the Master Servicer and
Others.
None
of
the Depositor, the Servicer, the Securities Administrator, the Master Servicer
or any of the directors, officers, employees or agents of the Depositor, the
Servicer or the Master Servicer shall be under any liability to the Trust Fund
or the Certificateholders for any action taken or for refraining from the taking
of any action in good faith pursuant to this Agreement, or for errors in
judgment; provided, however, that this provision shall not protect the
Depositor, the Servicer, the Securities Administrator, the Master Servicer
or
any such person against any breach of warranties, representations or covenants
made herein or against any specific liability imposed on any such Person
pursuant hereto or against any liability which would otherwise be imposed by
reason of willful misfeasance, bad faith or gross negligence in the performance
of duties or by reason of reckless disregard of obligations and duties
hereunder. The Depositor, the Servicer, the Securities Administrator, the Master
Servicer and any director, officer, employee or agent of the Depositor, the
Servicer, the Securities Administrator and the Master Servicer may rely in
good
faith on any document of any kind which, prima facie, is properly executed
and
submitted by any Person respecting any matters arising hereunder. The Depositor,
the Servicer, the Securities Administrator, the Master Servicer and any
director, officer, employee or agent of the Depositor, the Servicer, the
Securities Administrator or the Master Servicer shall be indemnified and held
harmless by the Trust Fund against any loss, liability or expense incurred
in
connection with any legal action relating to this Agreement, the Certificates
or
any Credit Risk Management Agreement or any loss, liability or expense incurred
other than by reason of willful misfeasance, bad faith or gross negligence
in
the performance of duties hereunder or by reason of reckless disregard of
obligations and duties hereunder. None of the Depositor, the Servicer, the
Securities Administrator or the Master Servicer shall be under any obligation
to
appear in, prosecute or defend any legal action unless such action is related
to
its respective duties under this Agreement and, in its opinion, does not involve
it in any expense or liability; provided, however, that each of the Depositor,
the Servicer, the Securities Administrator and the Master Servicer may in its
discretion undertake any such action which it may deem necessary or desirable
with respect to this Agreement and the rights and duties of the parties hereto
and the interests of the Certificateholders hereunder. In such event, the legal
expenses and costs of such action and any liability resulting therefrom (except
any loss, liability or expense incurred by reason of willful misfeasance, bad
faith or gross negligence in the performance of duties hereunder or by reason
of
reckless disregard of obligations and duties hereunder) shall be expenses,
costs
and liabilities of the Trust Fund, and the Depositor, the Servicer, the
Securities Administrator and the Master Servicer shall be entitled to be
reimbursed therefor from the Collection Account or the Distribution Account
as
and to the extent provided in Article III and Article IV, any such right of
reimbursement being prior to the rights of the Certificateholders to receive
any
amount in the Collection Account and the Distribution Account.
193
Notwithstanding
anything to the contrary contained herein, the Servicer shall not be liable
for
any actions or inactions prior to the Cut-off Date of any prior servicer of
the
related Mortgage Loans and the Master Servicer shall not be liable for any
action or inaction of the Servicer, except to the extent expressly provided
herein, or the Credit Risk Management Agreement.
SECTION
7.04. Limitation
on Resignation of the Servicer.
(a) Except
as
expressly provided herein, the Servicer shall neither assign all or
substantially all of its rights under this Agreement or the servicing hereunder
nor delegate all or substantially all of its duties hereunder nor sell or
otherwise dispose of all or substantially all of its property or assets without,
in each case, the prior written consent of the Master Servicer, which consent
shall not be unreasonably withheld; provided, that in each case, there must
be
delivered to the Trustee and the Master Servicer a letter from each Rating
Agency to the effect that such transfer of servicing or sale or disposition
of
assets will not result in a qualification, withdrawal or downgrade of the
then-current rating of any of the Certificates (the “Rating Condition”).
Notwithstanding the foregoing, the Servicer, without the consent of the Trustee
or the Master Servicer, may retain third-party contractors to perform certain
servicing and loan administration functions, including without limitation hazard
insurance administration, tax payment and administration, flood certification
and administration, collection services and similar functions, provided,
however, that the retention of such contractors by the Servicer shall not limit
the obligation of the Servicer to service the related Mortgage Loans pursuant
to
the terms and conditions of this Agreement. The Servicer shall not resign from
the obligations and duties hereby imposed on it except (i) upon determination
that its duties hereunder are no longer permissible under applicable law or
(ii)
upon the Servicer’s written proposal of a successor servicer reasonably
acceptable to each of the Sponsor, the Depositor and the Master Servicer. No
such resignation under clause (i) above shall become effective unless evidenced
by an Opinion of Counsel to such effect obtained at the expense of the Servicer
and delivered to the Trustee and the Rating Agencies. No such resignation of
the
Servicer under clause (ii) shall be effective unless:
194
(i) the
proposed successor Servicer is (1) an affiliate of the Master Servicer that
services mortgage loans similar to the Mortgage Loans in the jurisdictions
in
which the related Mortgaged Properties are located or (2) the proposed successor
Servicer has a rating of at least “Above Average” by S&P and either a rating
of at least “RPS2” by Fitch or a rating of at least “SQ2” by
Xxxxx’x;
(ii) the
Rating Agencies have confirmed to the Trustee that the appointment of the
proposed successor servicer as the servicer under this Agreement will not result
in the reduction or withdrawal of the then current ratings of any of the
Certificates; and
(iii) the
proposed successor servicer has a net worth of at least
$25,000,000.
Notwithstanding
anything to the contrary, no resignation of the Servicer shall become effective
until the Master Servicer or a successor servicer shall have assumed the
Servicer’s responsibilities, duties, liabilities (other than those liabilities
arising prior to the appointment of such successor) and obligations under this
Agreement. In addition, the Sponsor shall promptly inform the Credit Risk
Manager of the Servicer’s resignation under this Section 7.04.
(b) Except
as
expressly provided herein, the 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 Servicer hereunder.
The
foregoing prohibition on assignment shall not prohibit the Servicer from
designating a Sub-Servicer as payee of any indemnification amount payable to
the
Servicer hereunder; provided, however, that as provided in Section 3.02, no
Sub-Servicer shall be a third-party beneficiary hereunder and the parties hereto
shall not be required to recognize any Sub-Servicer as an indemnitee under
this
Agreement.
(c) Notwithstanding
anything to the contrary herein, the Servicer may pledge or assign as collateral
all its rights, title and interest under this Agreement to a lender (the
“Servicing Rights Lender”) and allow such Servicing Rights Lender (i) to cause
the transfer of servicing to a successor Servicer that meets the Rating
Condition if the Servicer defaults under its agreements with the Servicing
Rights Lender and (ii) upon an Event of Default and receipt of notice of
termination by the Servicer, the Servicing Rights Lender may direct the Servicer
or its designee to appoint a successor Servicer pursuant to the provisions,
and
subject to the conditions set forth in Section 8.02 regarding the
Servicer’s appointment of a successor Servicer, provided, that:
195
(i) the
Servicing Rights Lender’s rights are subject to this Agreement; and
(ii) such
Servicer shall remain subject to termination as servicer under this Agreement
pursuant to the terms hereof.
SECTION
7.05. Limitation
on Resignation of the Master Servicer.
The
Master Servicer shall not resign from the obligations and duties hereby imposed
on it except upon determination that its duties hereunder are no longer
permissible under applicable law. Any such determination pursuant to the
preceding sentence permitting the resignation of the Master Servicer shall
be
evidenced by an Opinion of Counsel to such effect obtained at the expense of
the
Master Servicer and delivered to the Trustee and the Rating Agencies. No
resignation of the Master Servicer shall become effective until the Trustee
or a
successor Master Servicer meeting the criteria specified in Section 7.06 shall
have assumed the Master Servicer’s responsibilities, duties, liabilities (other
than those liabilities arising prior to the appointment of such successor)
and
obligations under this Agreement.
SECTION
7.06. Assignment
of Master Servicing.
The
Master Servicer may sell and assign its rights and delegate its duties and
obligations in its entirety as Master Servicer under this Agreement; provided,
however, that: (i) the purchaser or transferee accept in writing such assignment
and delegation and assume the obligations of the Master Servicer hereunder
(a)
shall have a net worth of not less than $25,000,000 (unless otherwise approved
by each Rating Agency pursuant to clause (ii) below); (b) shall be reasonably
satisfactory to the Trustee (as evidenced in a writing signed by the Trustee);
and (c) shall execute and deliver to the Trustee an agreement, in form and
substance reasonably satisfactory to the Trustee, which contains an assumption
by such Person of the due and punctual performance and observance of each
covenant and condition to be performed or observed by it as master servicer
under this Agreement, any custodial agreement from and after the effective
date
of such agreement; (ii) each Rating Agency shall be given prior written notice
of the identity of the proposed successor to the Master Servicer and each Rating
Agency’s rating of the Certificates in effect immediately prior to such
assignment, sale and delegation will not be downgraded, qualified or withdrawn
as a result of such assignment, sale and delegation, as evidenced by a letter
to
such effect delivered to the Master Servicer and the Trustee; and (iii) the
Master Servicer assigning and selling the master servicing shall deliver to
the
Trustee an Officer’s Certificate and an Opinion of Independent counsel, each
stating that all conditions precedent to such action under this Agreement have
been completed and such action is permitted by and complies with the terms
of
this Agreement. No such assignment or delegation shall affect any liability
of
the Master Servicer arising out of acts or omissions prior to the effective
date
thereof.
196
SECTION
7.07. Rights
of
the Depositor in Respect of the Servicer and the Master Servicer.
Each
of
the Master Servicer and the Servicer shall afford (and any Sub-Servicing or
Sub-Contracting Agreement shall provide that each Sub-Servicer or Subcontractor,
as applicable shall afford) the Depositor and the Trustee, upon reasonable
notice, during normal business hours, access to all records maintained by the
Master Servicer or the Servicer (and any such Sub-Servicer or Subcontractor,
as
applicable) in respect of the Servicer’s rights and obligations hereunder and
access to officers of the Master Servicer or the Servicer (and those of any
such
Sub-Servicer or Subcontractor, as applicable) responsible for such obligations,
and the Master Servicer shall have access to all such records maintained by
the
Servicer and any Sub-Servicers or Subcontractors. Upon request, each of the
Master Servicer and the Servicer shall furnish to the Depositor and the Trustee
its (and any such Sub-Servicer’s or Subcontractor’s) most recent financial
statements and such other information relating to the Master Servicer’s or the
Servicer’s capacity to perform its obligations under this Agreement as it
possesses (and that any such Sub-Servicer or Subcontractor possesses). To the
extent that the Master Servicer or the Servicer informs the Depositor and the
Trustee that such information is not otherwise available to the public, the
Depositor and the Trustee shall not disseminate any information obtained
pursuant to the preceding two sentences without the Master Servicer’s or the
Servicer’s written consent, except as required pursuant to this Agreement or to
the extent that it is appropriate to do so (i) to its legal counsel, auditors,
taxing authorities or other governmental agencies and the Certificateholders,
(ii) pursuant to any law, rule, regulation, order, judgment, writ, injunction
or
decree of any court or governmental authority having jurisdiction over the
Depositor and the Trustee or the Trust Fund, and in any case, the Depositor
or
the Trustee, (iii) disclosure of any and all information that is or becomes
publicly known, or information obtained by the Trustee from sources other than
the Depositor, the Servicer or the Master Servicer, (iv) disclosure as required
pursuant to this Agreement or (v) disclosure of any and all information (A)
in
any preliminary or final offering circular, registration statement or contract
or other document pertaining to the transactions contemplated by the Agreement
approved in advance by the Depositor, the Servicer or the Master Servicer or
(B)
to any affiliate, independent or internal auditor, agent, employee or attorney
of the Trustee having a need to know the same, provided that the Trustee advises
such recipient of the confidential nature of the information being disclosed,
shall use its best efforts to assure the confidentiality of any such
disseminated non-public information. Nothing in this Section 7.07 shall limit
the obligation of the Servicer to comply with any applicable law prohibiting
disclosure of information regarding the Mortgagors and the failure of the
Servicer to provide access as provided in this Section 7.07 as a result of
such
obligation shall not constitute a breach of this Section. Nothing in this
Section 7.07 shall require the Servicer to collect, create, collate or otherwise
generate any information that it does not generate in its usual course of
business. The Servicer shall not be required to make copies of or ship documents
to any party unless provisions have been made for the reimbursement of the
costs
thereof. The Depositor may, but is not obligated to, enforce the obligations
of
the Master Servicer and the Servicer under this Agreement and may, but is not
obligated to, perform, or cause a designee to perform, any defaulted obligation
of the Master Servicer or the Servicer under this Agreement or exercise the
rights of the Master Servicer or the Servicer under this Agreement; provided
that neither the Master Servicer nor the Servicer shall be relieved of any
of
its obligations under this Agreement by virtue of such performance by the
Depositor or its designee. The Depositor shall not have any responsibility
or
liability for any action or failure to act by the Master Servicer or the
Servicer and is not obligated to supervise the performance of the Master
Servicer or the Servicer under this Agreement or otherwise.
197
SECTION
7.08. Duties
of
the Credit Risk Manager.
For
and
on behalf of the Depositor, the Credit Risk Manager will provide reports and
recommendations concerning certain delinquent and defaulted Mortgage Loans,
and
as to the collection of any Prepayment Charges with respect to the Mortgage
Loans. Such reports and recommendations will be based upon information provided
to the Credit Risk Manager pursuant to the Credit Risk Management Agreements,
and the Credit Risk Manager shall look solely to the Servicer and/or Master
Servicer for all information and data (including loss and delinquency
information and data) relating to the servicing of the related Mortgage Loans.
Upon any termination of the Credit Risk Manager or the appointment of a
successor Credit Risk Manager, the Depositor shall give written notice thereof
to the Servicer, the Master Servicer, the Securities Administrator, the Trustee,
and each Rating Agency. Notwithstanding the foregoing, the termination of the
Credit Risk Manager pursuant to this Section shall not become effective until
the appointment of a successor Credit Risk Manager. The Trustee is hereby
authorized to enter into any Credit Risk Management Agreement necessary to
effect the foregoing.
SECTION
7.09. Limitation
Upon Liability of the Credit Risk Manager.
Neither
the Credit Risk Manager, nor any of its directors, officers, employees, or
agents shall be under any liability to the Trustee, the Certificateholders,
or
the Depositor for any action taken or for refraining from the taking of any
action made in good faith pursuant to this Agreement, in reliance upon
information provided by the Servicer under the related Credit Risk Management
Agreement, or for errors in judgment; provided, however, that this provision
shall not protect the Credit Risk Manager or any such person against liability
that would otherwise be imposed by reason of willful malfeasance or bad faith
in
its performance of its duties. The Credit Risk Manager and any director,
officer, employee, or agent of the Credit Risk Manager 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, and may rely in good faith
upon
the accuracy of information furnished by the Servicer pursuant to the related
Credit Risk Management Agreement in the performance of its duties thereunder
and
hereunder.
SECTION
7.10. Removal
of the Credit Risk Manager.
The
Credit Risk Manager may be removed as Credit Risk Manager by Certificateholders
holding not less than 66 2/3% of the Voting Rights in the Trust Fund, in the
exercise of its or their sole discretion. The Certificateholders shall provide
written notice of the Credit Risk Manager’s removal to the Trustee. Upon receipt
of such notice, the Trustee shall provide written notice to the Credit Risk
198
Manager
of its removal, which shall be effective upon receipt of such notice by the
Credit Risk Manager, with a copy to the Securities Administrator and the Master
Servicer.
199
ARTICLE
VIII
DEFAULT
SECTION
8.01. Servicer
Events of Default.
(a) “Servicer
Event of Default,” wherever used herein, means any one of the following
events:
(i) any
failure by the Servicer to remit to the Securities Administrator for
distribution to the Certificateholders any payment (other than a P&I Advance
required to be made from its own funds on any Servicer Remittance Date pursuant
to Section 5.03 of this Agreement) required to be made by the Servicer under
the
terms of the Certificates and this Agreement which continues unremedied until
12:00 p.m. New York time on the Business Day immediately following the date
upon
which written notice of such failure, requiring the same to be remedied, shall
have been given to the Servicer by the Depositor, the Securities Administrator
or the Trustee (in which case notice shall be provided by telecopy), or to
the
Servicer, the Depositor and the Trustee by the Holders of Certificates entitled
to at least 25% of the Voting Rights; or
(ii) any
failure on the part of the Servicer duly to observe or perform in any material
respect any other of the covenants or agreements on the part of the Servicer
contained in this Agreement, or the material breach by the Servicer of any
representation and warranty contained in Section 2.05, which continues
unremedied for a period of thirty (30) days after the date on which written
notice of such failure, requiring the same to be remedied, shall have been
given
to the Servicer by the Depositor or the Trustee or to the Servicer, the
Depositor and the Trustee by the Holders of Certificates entitled to at least
25% of the Voting Rights; provided, however, that in the case of a failure
that
cannot be cured within thirty (30) days, the cure period may be extended for
an
additional thirty (30) days if the Servicer can demonstrate to the reasonable
satisfaction of the Trustee that the Servicer is diligently pursuing remedial
action; 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 Servicer and
such decree or order shall have remained in force undischarged or unstayed
for a
period of ninety (90) days; or
(iv) the
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
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;
200
(vi) failure
by the Servicer to duly perform, within the required time period, its
obligations under Sections 3.17, 3.18 or 3.20; or
(vii) any
failure of the Servicer to make any P&I Advance on any Servicer Remittance
Date required to be made from its own funds pursuant to Section 5.03 which
continues unremedied until 3:00 p.m. New York time on the Business Day
immediately following the Servicer Remittance Date; or
(viii) failure
of the Servicer to maintain at least an “average” rating from the Rating
Agencies.
If
a
Servicer Event of Default described in clauses (i) through (vi) or (viii) of
this Section shall occur, then, and in each and every such case, so long as
such
Servicer Event of Default shall not have been remedied, the Depositor or the
Trustee may, and at the written direction of the Holders of Certificates
entitled to at least 51% of Voting Rights, the Trustee shall, by notice in
writing to the defaulting Servicer (and to the Depositor if given by the Trustee
or to the Trustee if given by the Depositor) with a copy to the Master Servicer
and each Rating Agency, terminate all of the rights and obligations of the
defaulting Servicer in its capacity as Servicer under this Agreement, to the
extent permitted by law, and in and to the Mortgage Loans and the proceeds
thereof. If a Servicer Event of Default described in clause (vii) hereof shall
occur, the Trustee shall, by notice in writing to the defaulting Servicer,
the
Depositor and the Master Servicer, terminate all of the rights and obligations
of the defaulting Servicer in its capacity as Servicer under this Agreement
and
in and to the Mortgage Loans and the proceeds thereof. Subject to Section 8.02,
on or after the receipt by the defaulting Servicer of such written notice,
all
authority and power of the defaulting Servicer under this Agreement, whether
with respect to the Certificates (other than as a Holder of any Certificate)
or
the Mortgage Loans or otherwise, shall pass to and be vested in the Master
Servicer pursuant to and under this Section, and, without limitation, the Master
Servicer is hereby authorized and empowered, as attorney-in-fact or otherwise,
to execute and deliver, on behalf of and at the expense of the defaulting
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
defaulting Servicer agrees promptly (and in any event no later than ten (10)
Business Days subsequent to such notice) to provide the Master Servicer with
all
documents and records requested by it to enable it to assume the defaulting
Servicer’s functions under this Agreement, and to cooperate with the Master
Servicer in effecting the termination of the defaulting Servicer’s
responsibilities and rights under this Agreement, including, without limitation,
the transfer within one (1) Business Day to the Master Servicer for
administration by it of all cash amounts which at the time shall be or should
have been credited by the defaulting Servicer to the Collection Account held
by
or on behalf of the defaulting Servicer or thereafter be received with respect
to the related Mortgage Loans or any related REO Property (provided, however,
that the defaulting 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, whether in respect of P&I Advances, Servicing Advances,
accrued and unpaid Servicing Fees or otherwise, and shall continue to be
entitled to the benefits of Section 7.03, notwithstanding any such termination,
with respect to events occurring prior to such termination). Reimbursement
of
xxxxxxxxxxxx X&X Advances, Servicing Advances and accrued and unpaid
Servicing Fees shall be made on a first in, first out (“FIFO”) basis no later
than the Servicer Remittance Date. For purposes of this Section 8.01(a), the
Trustee shall not be deemed to have knowledge of a Servicer Event of Default
unless a Responsible Officer of the Trustee assigned to and working in the
Trustee’s Corporate Trust Office has actual knowledge thereof or unless written
notice of any event which is in fact such a Servicer Event of Default is
received by the Trustee at its Corporate Trust Office and such notice references
the Certificates, the Trust or this Agreement. The Trustee shall promptly notify
the Master Servicer and the Rating Agencies of the occurrence of a Servicer
Event of Default of which it has knowledge as provided above.
201
The
Master Servicer shall be entitled to be reimbursed by the defaulting Servicer
(or from amounts on deposit in the Distribution Account if the defaulting
Servicer is unable to fulfill its obligations hereunder) for all reasonable
out-of-pocket or third party costs associated with the transfer of servicing
from the defaulting Servicer, including without limitation, any reasonable
out-of-pocket or third party costs or expenses associated with the complete
transfer of all servicing data and the completion, correction or manipulation
of
such servicing data as may be required by the Master Servicer to correct any
errors or insufficiencies in the servicing data or otherwise to enable the
Master Servicer to service the Mortgage Loans properly and effectively, upon
presentation of reasonable documentation of such costs and
expenses.
(b) “Master
Servicer Event of Default,” wherever used herein, means any one of the following
events:
(i) 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, or the breach by the Master
Servicer of any representation and warranty contained in Section 2.04, which
continues unremedied for a period of 30 days after the date on which written
notice of such failure, or after such other period as set forth in this
Agreement, requiring the same to be remedied, shall have been given to the
Master Servicer by the Depositor or the Trustee or to the Master Servicer,
the
Depositor and the Trustee by the Holders of Certificates entitled to at least
25% of the Voting Rights; or
(ii) 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
(iii) 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
202
(iv) 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
(v) failure
by the Master Servicer to duly perform, within the required time period, its
obligations under Sections 4.15, 4.16, 4.17 or 4.18.
If
a
Master Servicer Event of Default 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 Trustee may, and at the written direction of
the
Holders of Certificates entitled to at least 51% of Voting Rights, the Trustee
shall, by notice in writing to the Master Servicer (and to the Depositor if
given by the Trustee or to the Trustee if given by the Depositor) with a copy
to
each Rating Agency, 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.
On
or after the receipt by the Master Servicer of such written notice, all
authority and power of the Master Servicer under this Agreement, whether with
respect to the Certificates (other than as a Holder of any Certificate) or
the
Mortgage Loans or otherwise including, without limitation, the compensation
payable to the Master Servicer under this Agreement, shall pass to and be vested
in the Trustee pursuant to and under this Section, and, without limitation,
the
Trustee is hereby authorized and empowered, as attorney-in-fact or otherwise,
to
execute and deliver, on behalf of and at the expense of the Master Servicer,
any
and all documents and other instruments and to do or accomplish all other acts
or things necessary or appropriate to effect the purposes of such notice of
termination, whether to complete the transfer and endorsement or assignment
of
the Mortgage Loans and related documents, or otherwise. The Master Servicer
agrees promptly (and in any event no later than ten Business Days subsequent
to
such notice) to provide the Trustee with all documents and records requested
by
it to enable it to assume the Master Servicer’s functions under this Agreement,
and to cooperate with the Trustee in effecting the termination of the Master
Servicer’s responsibilities and rights under this Agreement (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 7.03,
notwithstanding any such termination, with respect to events occurring prior
to
such termination). For purposes of this Section 8.01(b), the Trustee shall
not
be deemed to have knowledge of a Master Servicer Event of Default unless a
Responsible Officer of the Trustee assigned to and working in the Trustee’s
Corporate Trust Office has actual knowledge thereof or unless written notice
of
any event which is in fact such a Master Servicer Event of Default is received
by the Trustee and such notice references the Certificates, the Trust or this
Agreement. The Trustee shall promptly notify the Rating Agencies of the
occurrence of a Master Servicer Event of Default of which it has knowledge
as
provided above.
On
and
after the time the Master Servicer receives a notice of termination, the Trustee
shall be the successor in all respects to the Master Servicer (and, if
applicable, the Securities Administrator) in its capacity as Master Servicer
(and, if applicable, the Securities Administrator) 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 Trustee (except for any representations or warranties of the Master
Servicer under this Agreement, the responsibilities, duties and liabilities
contained in Section 2.03 and the obligation to deposit amounts in respect
of
losses pursuant to Section 3.10) by the terms and provisions hereof including,
without limitation, the Master Servicer’s obligations to make P&I Advances
no later than each Distribution Date pursuant to Section 5.03; provided,
however, that if the Trustee is prohibited by law or regulation from obligating
itself to make advances regarding delinquent mortgage loans, then the Trustee
shall not be obligated to make P&I Advances pursuant to Section 5.03; and
provided further, that any failure to perform such duties or responsibilities
caused by the Master Servicer’s failure to provide information required by
Section 8.01 shall not be considered a default by the Trustee as successor
to
the Master Servicer hereunder and neither the Trustee nor any other successor
master servicer shall be liable for any acts or omissions of the terminated
master servicer. As compensation therefor, the Trustee shall be entitled to
the
Master Servicing Fee and all funds relating to the Loans, investment earnings
on
the Distribution Account and all other remuneration to which the Master Servicer
would have been entitled if it had continued to act hereunder.
203
Notwithstanding
the foregoing, the Trustee may, if it shall be unwilling to continue to act,
or
shall, if it is unable to so act, petition a court of competent jurisdiction
to
appoint, or appoint on its own behalf, any established housing and home finance
institution servicer, master servicer, servicing or mortgage servicing
institution having a net worth of not less than $25,000,000 and meeting such
other standards for a successor master servicer as are set forth in this
Agreement, as the successor to such Master Servicer in the assumption of all
of
the responsibilities, duties or liabilities of a master servicer.
To
the
extent that the costs and expenses of the Trustee related to the termination
of
the Master Servicer, appointment of a successor Master Servicer or the transfer
and assumption of the master servicing by the Trustee (including, without
limitation, (i) all legal costs and expenses and all due diligence costs and
expenses associated with an evaluation of the potential termination of the
Master Servicer as a result of a Master Servicer Event of Default and (ii)
all
costs and expenses associated with the complete transfer of the master
servicing, including all servicing files and all servicing data and the
completion, correction or manipulation of such servicing data as may be required
by the successor Master Servicer to correct any errors or insufficiencies in
the
servicing data or otherwise to enable the successor Master Servicer to master
service the Mortgage Loans in accordance with this Agreement) are not fully
and
timely reimbursed by the terminated Master Servicer, the Trustee shall be
entitled to reimbursement of such costs and expenses from the Distribution
Account.
Neither
the Trustee nor any other successor master 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 the Master Servicer to deliver or provide, or any
delay
in delivering or providing, any cash, information, documents or records to
it.
SECTION
8.02. Master
Servicer to Act; Appointment of Successor.
(a) Subject
to the following paragraph, on and after the time the Servicer receives a notice
of termination, the Master Servicer shall be the successor in all respects
to
the Servicer in its capacity as the 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 Master Servicer (except for any representations or warranties of the
Servicer under this Agreement, the responsibilities, duties and liabilities
contained in Section 2.03 and the obligation to deposit amounts in respect
of
losses pursuant to Section 3.10(b)) by the terms and provisions hereof
including, without limitation, the Servicer’s obligations to make P&I
Advances pursuant to Section 5.03 of this Agreement; provided, however, that
if
the Master Servicer is prohibited by law or regulation from obligating itself
to
make advances regarding delinquent mortgage loans, then the Master Servicer
shall not be obligated to make P&I Advances pursuant to Section 5.03 of this
Agreement; and provided further, that any failure to perform such duties or
responsibilities caused by the Servicer’s failure to provide information
required by Section 8.01 shall not be considered a default by the Master
Servicer as successor to the Servicer hereunder; provided, however, that (1)
it
is understood and acknowledged by the parties hereto that there will be a period
of transition (not to exceed 120 days) before the actual servicing functions
can
be fully transferred to the Master Servicer or any successor servicer appointed
in accordance with the following provisions and (2) any failure to perform
such
duties or responsibilities caused by the Servicer’s failure to provide
information required by Section 8.01 of this Agreement shall not be considered
a
default by the Master Servicer as successor to the Servicer. As compensation
therefor, the Master Servicer shall be entitled to the Servicing Fee and all
funds relating to the Mortgage Loans to which the terminated Servicer would
have
been entitled if it had continued to act hereunder. Notwithstanding the above
and subject to the immediately following paragraph, the Master Servicer may,
if
it shall be unwilling to so act, or shall, if it is unable to so act promptly
appoint or petition a court of competent jurisdiction to appoint, a Person
that
satisfies the eligibility criteria set forth below as the successor to the
terminated Servicer under this Agreement in the assumption of all or any part
of
the responsibilities, duties or liabilities of the terminated Servicer under
this Agreement.
204
Notwithstanding
any provision in this Agreement to the contrary, for a period of 30 days
following the date on which Ocwen shall have received a notice of termination
pursuant to Section 8.01 of this Agreement, Ocwen or its designee may
appoint a successor Servicer with respect to the Ocwen Mortgage Loans that
satisfies the eligibility criteria of a successor Servicer set forth below,
which appointment shall be subject to the consent of the Depositor, the Sponsor,
the Master Servicer, and the Trustee, which consent shall not be unreasonably
withheld or delayed; provided that such successor Servicer agrees to fully
effect the servicing transfer within 120 days following the termination of
Ocwen
and to make all P&I Advances that would otherwise be made by the Master
Servicer under Section 8.01 as of the date of such appointment, and to
reimburse the Master Servicer for any xxxxxxxxxxxx X&X Advances they have
made and any reimbursable expenses that they may have incurred in connection
with this Section 8.02. Any proceeds received in connection with the
appointment of such successor Servicer shall be the property of Ocwen or its
designee. This 30-day period shall terminate immediately (i) at the close of
business on the second Business Day of such 30-day period if (A) Ocwen was
terminated because of an Event of Default described in Section 8.01(a)(vii)
for failing to make a required P&I Advance, and (B) Ocwen shall have failed
to make (or cause to be made) such P&I Advance, or shall fail to reimburse
(or cause to be reimbursed) the Master Servicer for a P&I Advance made by
the Master Servicer, by the close of business on such second Business Day,
or
(ii) at the close of business on the second Business Day following the date
(if
any) during such 30-day period on which a P&I Advance is due to be made, if
Ocwen shall have failed to make (or caused to be made) such P&I Advance, or
Ocwen shall have failed to reimburse (or cause to be reimbursed) the Master
Servicer for such P&I Advance, by the close of business on such second
Business Day; provided, that such 30-day period shall only be terminated to
the
extent that the Servicing Rights Lender has received notice of such failure
from
the Master Servicer and the Servicing Rights Lender has not cured or caused
the
cure of such failure within two (2) Business Days following receipt of notice,
provided, however, that such notice requirement shall only be applicable to
the
extent that the Master Servicer has been provided with the written address
and
contact information for the Servicing Rights Lender.
205
Notwithstanding
anything herein to the contrary, in no event shall the Trustee or the Master
Servicer be liable for any Servicing Fee or Master Servicing Fee, as applicable,
or for any differential in the amount of the Servicing Fee or Master Servicing
Fee, as applicable, or paid hereunder and the amount necessary to induce any
successor Servicer or successor Master Servicer to act as successor Servicer
or
successor Master Servicer under this Agreement and the transactions set forth
or
provided for herein.
Any
successor servicer appointed under this Agreement must (i) be an established
mortgage loan servicing institution that is a Xxxxxx Xxx and Xxxxxxx Mac
approved seller/servicer, (ii) be approved by each Rating Agency by a written
confirmation from each Rating Agency that the appointment of such successor
servicer would not result in the reduction or withdrawal of the then current
ratings of any outstanding Class of Certificates, (iii) have a net worth of
not
less than $25,000,000 and (iv) assume all the responsibilities, duties or
liabilities of the Servicer (other than liabilities of the Servicer hereunder
incurred prior to termination of the Servicer under Section 8.01 herein) under
this Agreement as if originally named as a party to this Agreement.
(b) (1)
All
servicing transfer costs (including, without limitation, servicing transfer
costs of the type described in Section 8.02(a) and incurred by the Trustee,
the
Master Servicer and any successor servicer under paragraph (b)(2) below) in
connection with the termination of the Servicer shall be paid by the terminated
Servicer upon presentation of reasonable documentation of such costs, and if
such predecessor or initial Servicer, as applicable, defaults in its obligation
to pay such costs, the successor servicer, the Master Servicer and the Trustee
shall be entitled to reimbursement therefor from the assets of the Trust
Fund.
(2)
No
appointment of a successor to the Servicer under this Agreement shall be
effective until the assumption by the successor of all of the Servicer’s
responsibilities, duties and liabilities hereunder. In connection with such
appointment and assumption described herein, the Trustee may make such
arrangements for the compensation of such successor out of payments on the
Mortgage Loans as it and such successor shall agree; provided, however, that
no
such compensation shall be in excess of that permitted the Servicer as such
hereunder. The Depositor, the Trustee and such successor shall take such action,
consistent with this Agreement, as shall be necessary to effectuate any such
succession. Pending appointment of a successor to the Servicer under this
Agreement, the Master Servicer shall act in such capacity as hereinabove
provided.
206
SECTION
8.03. Notification
to Certificateholders.
(a) Upon
any
termination of the Servicer or the Master Servicer pursuant to Section 8.01(a)
or (b) or any appointment of a successor to the Servicer or the Master Servicer
pursuant to Section 8.02, the Trustee shall give prompt written notice thereof
to the Certificateholders at their respective addresses appearing in the
Certificate Register.
(b) Not
later
than the later of sixty (60) days after the occurrence of any event, which
constitutes or which, with notice or lapse of time or both, would constitute
a
Servicer Event of Default or a Master Servicer Event of Default or five (5)
days
after a Responsible Officer of the Trustee becomes aware of the occurrence
of
such an event, the Trustee shall transmit by mail to all Holders of Certificates
notice of each such occurrence, unless such default or Servicer Event of Default
or Master Servicer Event of Default shall have been cured or
waived.
SECTION
8.04. Waiver
of
Events of Default.
The
Holders representing at least 66% of the Voting Rights evidenced by all Classes
of Certificates affected by any default, Servicer Event of Default or Master
Servicer Event of Default hereunder may waive such default, Servicer Event
of
Default or Master Servicer Event of Default; provided, however, that a Servicer
Event of Default under clause (i) or (vii) of Section 8.01(a) may be waived
only
by all of the Holders of the Regular Certificates. Upon any such waiver of
a
default, Servicer Event of Default or Master Servicer Event of Default, such
default, Servicer Event of Default or Master Servicer Event of Default shall
cease to exist and shall be deemed to have been remedied for every purpose
hereunder. No such waiver shall extend to any subsequent or other default,
Servicer Event of Default or Master Servicer Event of Default or impair any
right consequent thereon except to the extent expressly so waived.
207
ARTICLE
IX
CONCERNING
THE TRUSTEE AND THE SECURITIES ADMINISTRATOR
SECTION
9.01. Duties
of
Trustee and Securities Administrator.
The
Trustee, prior to the occurrence of a Master Servicer Event of Default and
after
the curing or waiver of all Master Servicer Events of Default which may have
occurred, and the Securities Administrator each undertake to perform such duties
and only such duties as are specifically set forth in this Agreement as duties
of the Trustee and the Securities Administrator, respectively. During the
continuance of a Master Servicer Event of Default, the Trustee shall exercise
such of the rights and powers vested in it by this Agreement, and use the same
degree of care and skill in its exercise as a prudent person would exercise
or
use under the circumstances in the conduct of such person’s own affairs. Any
permissive right of the Trustee enumerated in this Agreement shall not be
construed as a duty.
Each
of
the Trustee and the Securities Administrator, upon receipt of all resolutions,
certificates, statements, opinions, reports, documents, orders or other
instruments furnished to it, which are specifically required to be furnished
pursuant to any provision of this Agreement, shall examine them to determine
whether they conform to the requirements of this Agreement. If any such
instrument is found not to conform to the requirements of this Agreement in
a
material manner, the Trustee or the Securities Administrator, as the case may
be, shall take such action as it deems appropriate to have the instrument
corrected, and if the instrument is not corrected to its satisfaction, the
Securities Administrator will provide notice to the Trustee thereof and the
Trustee will provide notice to the Certificateholders.
The
Trustee shall promptly remit to the Servicer any complaint, claim, demand,
notice or other document (collectively, the “Notices”) delivered to the Trustee
as a consequence of the assignment of any Mortgage Loan hereunder and relating
to the servicing of the Mortgage Loans; provided than any such notice (i) is
delivered to the Trustee at its Corporate Trust Office, (ii) contains
information sufficient to permit the Trustee to make a determination that the
real property to which such document relates is a Mortgaged Property. The
Trustee shall have no duty hereunder with respect to any Notice it may receive
or which may be alleged to have been delivered to or served upon it unless
such
Notice is delivered to it or served upon it at its Corporate Trust Office and
such Notice contains the information required pursuant to clause (ii) of the
preceding sentence.
No
provision of this Agreement shall be construed to relieve the Trustee or the
Securities Administrator from liability for its own negligent action, its own
negligent failure to act or its own misconduct; provided, however,
that:
(i) Prior
to
the occurrence of a Master Servicer Event of Default and after the curing or
waiver of all such Master Servicer Events of Default which may have occurred
with respect to the Trustee and at all times with respect to the Securities
Administrator, the duties and obligations of the Trustee shall be determined
solely by the express provisions of this Agreement, neither the Trustee nor
the
Securities Administrator shall be liable except for the performance of such
duties and obligations as are specifically set forth in this Agreement, no
implied covenants or obligations shall be read into this Agreement against
the
Trustee or the Securities Administrator and, in the absence of bad faith on
the
part of the Trustee or the Securities Administrator, respectively, the Trustee
or the Securities Administrator, respectively, may conclusively rely, as to
the
truth of the statements and the correctness of the opinions expressed therein,
upon any certificates or opinions furnished to the Trustee or the Securities
Administrator, respectively, that conform to the requirements of this
Agreement;
208
(ii) Neither
the Trustee nor the Securities Administrator shall be liable for an error of
judgment made in good faith by a Responsible Officer or Responsible Officers
of
the Trustee or an officer or officers of the Securities Administrator,
respectively, unless it shall be proved that the Trustee or the Securities
Administrator, respectively, was negligent in ascertaining the pertinent facts;
and
(iii) Neither
the Trustee nor the Securities Administrator shall be liable with respect to
any
action taken, suffered or omitted to be taken by it in good faith in accordance
with the direction of the Holders of Certificates entitled to at least 25%
of
the Voting Rights relating to the time, method and place of conducting any
proceeding for any remedy available to the Trustee or the Securities
Administrator or exercising any trust or power conferred upon the Trustee or
the
Securities Administrator under this Agreement.
SECTION
9.02. Certain
Matters Affecting Trustee and Securities Administrator.
(a) Except
as
otherwise provided in Section 9.01:
(i) Before
taking any action hereunder, the Trustee and the Securities Administrator may
request and rely upon and shall be protected in acting or refraining from acting
upon any resolution, Officers’ Certificate, certificate of auditors or any other
certificate, statement, instrument, opinion, report, notice, request, consent,
order, appraisal, bond or other paper or document reasonably believed by it
to
be genuine and to have been signed or presented by the proper party or
parties;
(ii) The
Trustee and the Securities Administrator may consult with counsel of its
selection and any advice of such counsel or any Opinion of Counsel shall be
full
and complete authorization and protection in respect of any action taken or
suffered or omitted by it hereunder in good faith and in accordance with such
advice or Opinion of Counsel;
(iii) Neither
the Trustee nor the Securities Administrator shall be under any obligation
to
exercise any of the trusts or powers vested in it by this Agreement or to
institute, conduct or defend any litigation hereunder or in relation hereto
at
the request, order or direction of any of the Certificateholders, pursuant
to
the provisions of this Agreement, unless such Certificateholders shall have
offered to the Trustee or the Securities Administrator, as the case may be,
reasonable security or indemnity satisfactory to it against the costs, expenses
and liabilities which may be incurred therein or thereby; nothing contained
herein shall, however, relieve the Trustee of the obligation, upon the
occurrence of a Master Servicer Event of Default (which has not been cured
or
waived), to exercise such of the rights and powers vested in it by this
Agreement, and to use the same degree of care and skill in their exercise as
a
prudent person would exercise or use under the circumstances in the conduct
of
such person’s own affairs;
209
(iv) Neither
the Trustee nor the Securities Administrator shall be liable for any action
taken, suffered or omitted by it in good faith and believed by it to be
authorized or within the discretion or rights or powers conferred upon it by
this Agreement;
(v) Prior
to
the occurrence of a Master Servicer Event of Default hereunder and after the
curing or waiver of all Master Servicer Events of Default which may have
occurred with respect to the Trustee and at all times with respect to the
Securities Administrator, neither the Trustee nor the Securities Administrator
shall 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 Holders of Certificates entitled to at
least 25% of the Voting Rights; provided, however, that if the payment within
a
reasonable time to the Trustee or the Securities Administrator of the costs,
expenses or liabilities likely to be incurred by it in the making of such
investigation is, in the opinion of the Trustee or the Securities Administrator,
as applicable, not reasonably assured to the Trustee or the Securities
Administrator by such Certificateholders, the Trustee or the Securities
Administrator, as applicable, may require reasonable indemnity satisfactory
to
it against such expense, or liability from such Certificateholders as a
condition to taking any such action;
(vi) The
Trustee may execute any of the trusts or powers hereunder or perform any duties
hereunder either directly or by or through agents or attorneys and the Trustee
shall not be responsible for any misconduct or negligence on the part of any
agent or attorney appointed with due care by it hereunder;
(vii) The
Trustee shall not be liable for any loss resulting from (a) the investment
of
funds held in the Collection Account, (b) the investment of funds held in the
Distribution Account, (c) the investment of funds held in the Reserve Fund
or
(d) the redemption or sale of any such investment as therein
authorized;
(viii) The
Trustee shall not be deemed to have notice of any default, Master Servicer
Event
of Default or Servicer Event of Default unless a Responsible Officer of the
Trustee has actual knowledge thereof or unless written notice of any event
which
is in fact such a default is received by a Responsible Officer of the Trustee
at
the Corporate Trust Office of the Trustee, and such notice references the
Certificates and this Agreement;
(ix) The
rights, privileges, protections, immunities and benefits given to the Trustee,
including, without limitation, its right to be indemnified, are extended to,
and
shall be enforceable by, each agent, custodian and other Person employed to
act
hereunder; and
210
(x) Should
the Trustee or the Securities Administrator deem the nature of any action
required on its part to be unclear, the Trustee or the Securities Administrator
may require prior to taking such action that it be provided by the Depositor
with reasonable further instructions.
(xi) No
provision of this Agreement shall require the Trustee (regardless of the
capacity in which it is acting) to expend or risk its own funds or otherwise
incur any financial liability in the performance of any of its duties hereunder,
or in the exercise of any of its rights or powers, if it shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity against
risk or liability is not reasonably assured to it.
(xii) The
Trustee shall not have any duty to conduct any affirmative investigation as
to
the occurrence of any condition requiring the repurchase of any Mortgage Loan
by
the Sponsor pursuant to this Agreement or the Mortgage Loan Purchase Agreement,
as applicable, or the eligibility of any Mortgage Loan for purposes of this
Agreement.
(b) All
rights of action under this Agreement or under any of the Certificates,
enforceable by the Trustee, may be enforced by it without the possession of
any
of the Certificates, or the production thereof at the trial or other proceeding
relating thereto, and any such suit, action or proceeding instituted by the
Trustee shall be brought in its name for the benefit of all the Holders of
such
Certificates, subject to the provisions of this Agreement.
(c) The
Trustee, not in its individual capacity but solely in its separate capacity
as
Supplemental Interest Trust Trustee, is hereby directed to exercise the rights,
perform the obligations, and make any representations to be exercised,
performed, or made by the Supplemental Interest Trust Trustee, as described
herein. The Supplemental Interest Trust Trustee is hereby directed to execute
and deliver the Swap Agreement on behalf of Party B (as defined therein) and
to
exercise the rights, perform the obligations, and make the representations
of
Party B thereunder, solely in its capacity as Supplemental Interest Trust
Trustee on behalf of Party B (as defined therein) and not in its individual
capacity.
The
Sponsor, the Servicer, the Depositor and the Certificateholders (by acceptance
of their Certificates) acknowledge and agree that:
(i) the
Supplemental Interest Trust Trustee shall execute and deliver the Swap Agreement
on behalf of Party B (as defined therein),
(ii) the
Supplemental Interest Trust Trustee shall exercise the rights, perform the
obligations, and make the representations of Party B thereunder, solely in
its
capacity as Supplemental Interest Trust Trustee on behalf of Party B (as defined
therein) and not in its individual capacity, and
211
(iii) the
Securities Administrator shall also be entitled to exercise the rights and
obligated to perform the obligations of Party B under the Swap
Agreement.
Every
provision of this Agreement relating to the conduct or affecting the liability
of or affording protection to the Trustee shall apply to the Trustee’s
execution, as Supplemental Interest Trust Trustee, of the Swap Agreement, and
the performance of its duties and satisfaction of its obligations
thereunder.
(d) The
Trustee is hereby directed to exercise the rights, perform the obligations,
and
make any representations to be exercised, performed, or made, as described
herein. The Trustee is hereby directed to execute and deliver the Cap Contracts
on behalf of Party B (as defined therein) and to exercise the rights, perform
the obligations, and make the representations of Party B thereunder, solely
in
its capacity as Trustee on behalf of Party B (as defined therein) and not in
its
individual capacity.
The
Sponsor, the Servicer, the Depositor and the Certificateholders by acceptance
of
their Certificates acknowledge and agree that:
(i) the
Trustee shall execute and deliver the Cap Contracts for Party B (as defined
therein)
(ii) the
Trustee shall exercise the rights, perform the obligations, and make the
representations of Party B thereunder, solely in its capacity as Trustee on
behalf of Party B (as defined therein) and not in its individual capacity,
and
(iii) the
Securities Administrator shall also be entitled to exercise the rights and
obligated to perform the obligations of Party B under the Cap
Contracts.
Every
provision of this Agreement relating to the conduct or affecting the liability
of or affording protection to the Trustee shall apply to the Trustee’s execution
of the Cap Contracts, and the performance of its duties and satisfaction of
its
obligations thereunder.
Every
provision of this Agreement relating to the conduct or affecting the liability
of or affording protection to the Securities Administrator shall apply to the
Securities Administrator’s execution of the Cap Contracts, and the performance
of its duties and satisfaction of its obligations thereunder.
(e) The
Trustee is hereby directed to execute and deliver the Cap Contracts for Party
B
(as defined therein) and to perform the obligations of Party B thereunder on
the
Closing Date and thereafter on behalf of the Holders of the Certificates. The
Sponsor, the Depositor and the Certificateholders by acceptance of their
Certificates acknowledge and agree that the Trustee shall execute and deliver
the Cap Contracts for Party B (as defined therein) and to perform the
obligations of Party B thereunder and shall do so solely in its capacity as
Trustee and not in its individual capacity. The Trustee is hereby directed
and
does hereby direct the Securities Administrator and the Securities Administrator
is hereby empowered under this Agreement to act on behalf of the Trustee. Any
funds payable by the Securities Administrator under the Cap Contracts at closing
shall be paid by the Depositor. Notwithstanding anything to the contrary
contained herein, neither the Trustee nor the Securities Administrator shall
be
required to make any payments to the Cap Counterparty under the Cap Contracts
unless otherwise set forth in the Cap Contracts.
212
(f) None
of
the Securities Administrator, the Master Servicer, the Servicer, the Sponsor,
the Depositor, the Custodian or the Trustee shall be responsible for the acts
or
omissions of the others or the Swap Provider or the Cap Counterparty, it being
understood that this Agreement shall not be construed to render those partners
joint venturers or agents of one another.
SECTION
9.03. Trustee
and Securities Administrator not Liable for Certificates or Mortgage
Loans.
The
recitals contained herein and in the Certificates (other than the signature
of
the Securities Administrator, the authentication of the Securities Administrator
on the Certificates, the acknowledgments of the Trustee contained in Article
II
and the representations and warranties of the Trustee in Sections 2.11 and
9.12)
shall be taken as the statements of the Depositor and neither the Trustee nor
the Securities Administrator assumes any responsibility for their correctness.
Neither the Trustee nor the Securities Administrator makes any representations
or warranties as to the validity or sufficiency of this Agreement (other than
as
specifically set forth in Section 9.12), the Swap Agreement or of the
Certificates (other than the signature of the Securities Administrator and
authentication of the Securities Administrator on the Certificates) or of any
Mortgage Loan or related document. The Trustee and the Securities Administrator
shall not be accountable for the use or application by the Depositor of any
of
the Certificates or of the proceeds of such Certificates, or for the use or
application of any funds paid to the Depositor or the Master Servicer in respect
of the Mortgage Loans or deposited in or withdrawn from the Collection Account
by the Servicer, other than with respect to the Securities Administrator any
funds held by it or on behalf of the Trustee in accordance with Sections 3.24,
3.25 and 5.07 of this Agreement.
SECTION
9.04. Trustee
and Securities Administrator May Own Certificates.
Each
of
the Trustee and the Securities Administrator in its individual capacity or
any
other capacity may become the owner or pledgee of Certificates and may transact
business with other interested parties and their Affiliates with the same rights
it would have if it were not Trustee or the Securities
Administrator.
SECTION
9.05. Fees
and
Expenses of Trustee, Custodian and Securities Administrator.
The
fees
of the Trustee and the Securities Administrator hereunder and of Xxxxx Fargo
as
the Custodian under the Custodial Agreement shall be paid in accordance with
a
side letter agreement with the Master Servicer and at the sole expense of the
Master Servicer. In addition, the Trustee, the Securities Administrator, the
Custodian and any director, officer, employee or agent of the Trustee, the
Securities Administrator and the Custodian shall be indemnified by the Trust
and
held harmless against any loss, liability or expense (including reasonable
attorney’s fees and expenses) incurred by the Trustee, the Custodian or the
Securities Administrator in connection with any claim or legal action or any
pending or threatened claim or legal action arising out of or in connection
with
the acceptance or administration of its respective obligations and duties under
this Agreement, including the Swap Agreement and any and all other agreements
related hereto, other than any loss, liability or expense, as applicable (i)
solely with respect to the Trustee, for which the Trustee is indemnified by
the
Master Servicer or the Servicer, (ii) that constitutes a specific liability
of
the Trustee or the Securities Administrator, as applicable, pursuant to Section
11.01(g) or (iii) any loss, liability or expense incurred by reason of willful
misfeasance, bad faith or negligence in the performance of duties hereunder
by
the Trustee or the Securities Administrator or by reason of reckless disregard
of obligations and duties hereunder. In no event shall the Trustee, the
Custodian, the Master Servicer or the Securities Administrator be liable for
special, indirect or consequential loss or damage of any kind whatsoever
(including but not limited to lost profits), even if it has been advised of
the
likelihood of such loss or damage and regardless of the form of action. The
Master Servicer agrees to indemnify the Trustee, from, and hold the Trustee
harmless against, any loss, liability or expense (including reasonable
attorney’s fees and expenses) incurred by the Trustee by reason of the Master
Servicer’s willful misfeasance, bad faith or gross negligence in the performance
of its duties under this Agreement or by reason of the Master Servicer’s
reckless disregard of its obligations and duties under this Agreement. In
addition, the Sponsor agrees to indemnify the Trustee for, and to hold the
Trustee harmless against, any loss, liability or expense arising out of, or
in
connection with, the provisions set forth in the last paragraph of Section
2.01,
including, without limitation, all costs, liabilities and expenses (including
reasonable legal fees and expenses) of investigating and defending itself
against any claim, action or proceeding, pending or threatened, relating to
the
provisions of such paragraph. The indemnities in this Section 9.05 shall survive
the termination or discharge of this Agreement and the resignation or removal
of
the Master Servicer, the Trustee, the Securities Administrator or the Custodian.
Any payment under this Section 9.05 made by the Master Servicer to the Trustee
in respect of the Trustee’s fees or the Master Servicer’s indemnification
obligation to the Trustee shall be from the Master Servicer’s own funds, without
reimbursement from REMIC I therefor.
213
SECTION
9.06. Eligibility
Requirements for Trustee and Securities Administrator.
The
Trustee and the Securities Administrator shall at all times be a corporation
or
an association (other than the Depositor, the Sponsor, the Master Servicer
or
any Affiliate of the foregoing) organized and doing business under the laws
of
any state or the United States of America, authorized under such laws to
exercise corporate trust powers, having a combined capital and surplus of at
least $50,000,000 (or a member of a bank holding company whose capital and
surplus is at least $50,000,000) and subject to supervision or examination
by
federal or state authority. If such corporation or association publishes reports
of conditions at least annually, pursuant to law or to the requirements of
the
aforesaid supervising or examining authority, then for the purposes of this
Section the combined capital and surplus of such corporation or association
shall be deemed to be its combined capital and surplus as set forth in its
most
recent report of conditions so published. In case at any time the Trustee or
the
Securities Administrator, as applicable, shall cease to be eligible in
accordance with the provisions of this Section, the Trustee or the Securities
Administrator, as applicable, shall resign immediately in the manner and with
the effect specified in Section 9.07.
214
Additionally,
the Securities Administrator (i) may not be an originator, Servicer, the
Depositor or an affiliate of the Depositor unless the Securities Administrator
is in an institutional trust department, (ii) must be authorized to exercise
corporate trust powers under the laws of its jurisdiction of organization,
and
(iii) must be rated at least "A/F1" by Fitch, if Fitch is a Rating Agency,
or
the equivalent rating by S&P (or such rating acceptable to Fitch pursuant to
a rating confirmation). If no successor securities administrator shall have
been
appointed and shall have accepted appointment within 60 days after Xxxxx Fargo
Bank, National Association, as Securities Administrator, ceases to be the
securities administrator pursuant to this Section 9.06, then the Trustee shall
petition any court of competent jurisdiction, at the expense of the Trust,
for
the appointment of a successor securities administrator which satisfies the
eligibility criteria set forth herein. The Trustee shall notify the Rating
Agencies of any change of Securities Administrator.
SECTION
9.07. Resignation
and Removal of Trustee and Securities Administrator.
The
Trustee and the Securities Administrator may at any time resign and be
discharged from the trust hereby created by giving written notice thereof to
the
Depositor, to the Master Servicer, to the Securities Administrator (or the
Trustee, if the Securities Administrator resigns) and to the Certificateholders.
Upon receiving such notice of resignation, the Depositor shall promptly appoint
a successor trustee or successor securities administrator by written instrument,
in duplicate, which instrument shall be delivered to the resigning Trustee
or
Securities Administrator, as applicable, and to the successor trustee or
successor securities administrator, as applicable. A copy of such instrument
shall be delivered to the Certificateholders, the Trustee, the Securities
Administrator and the Master Servicer by the Depositor. If no successor trustee
or successor securities administrator shall have been so appointed and have
accepted appointment within thirty (30) days after the giving of such notice
of
resignation, the resigning Trustee or Securities Administrator, as the case
may
be, may, at the expense of the Trust Fund, petition any court of competent
jurisdiction for the appointment of a successor trustee, successor securities
administrator, Trustee or Securities Administrator, as applicable.
If
at any
time the Trustee or the Securities Administrator shall cease to be eligible
in
accordance with the provisions of Section 9.06 and shall fail to resign after
written request therefor by the Depositor, or if at any time the Trustee or
the
Securities Administrator shall become incapable of acting, or shall be adjudged
bankrupt or insolvent, or a receiver of the Trustee or the Securities
Administrator or of its property shall be appointed, or any public officer
shall
take charge or control of the Trustee or the Securities Administrator or of
its
property or affairs for the purpose of rehabilitation, conservation or
liquidation, then the Depositor may remove the Trustee or the Securities
Administrator, as applicable and appoint a successor trustee or successor
securities administrator, as applicable, by written instrument, in duplicate,
which instrument shall be delivered to the Trustee or the Securities
Administrator so removed and to the successor trustee or successor securities
administrator. A copy of such instrument shall be delivered to the
Certificateholders, the Trustee, the Securities Administrator and the Master
Servicer by the Depositor.
215
The
Holders of Certificates entitled to at least 51% of the Voting Rights may at
any
time remove the Trustee or the Securities Administrator and appoint a successor
trustee or successor securities administrator by written instrument or
instruments, in triplicate, signed by such Holders or their attorneys-in-fact
duly authorized, one complete set of which instruments shall be delivered to
the
Depositor, one complete set to the Trustee or the Securities Administrator
so
removed and one complete set to the successor so appointed. A copy of such
instrument shall be delivered to the Certificateholders, the Trustee (in the
case of the removal of the Securities Administrator), the Securities
Administrator (in the case of the removal of the Trustee) and the Master
Servicer by the Depositor.
Any
resignation or removal of the Trustee or the Securities Administrator and
appointment of a successor trustee or successor securities administrator
pursuant to any of the provisions of this Section shall not become effective
until acceptance of appointment by the successor trustee or successor securities
administrator, as applicable, as provided in Section 9.08.
Any
Person appointed as successor trustee pursuant to Section 9.07 shall also be
required to serve as successor supplemental interest trust trustee.
Notwithstanding
anything to the contrary contained herein, the Master Servicer and the
Securities Administrator shall at all times be the same Person.
SECTION
9.08. Successor
Trustee or Securities Administrator.
Any
successor trustee or successor securities administrator appointed as provided
in
Section 9.07 shall execute, acknowledge and deliver to the Depositor and its
predecessor trustee or predecessor securities administrator an instrument
accepting such appointment hereunder, and thereupon the resignation or removal
of the predecessor trustee or predecessor securities administrator shall become
effective and such successor trustee or successor securities administrator
without any further act, deed or conveyance, shall become fully vested with
all
the rights, powers, duties and obligations of its predecessor hereunder, with
the like effect as if originally named as trustee or securities administrator
herein. The predecessor trustee or predecessor securities administrator shall
deliver to the successor trustee or successor securities administrator all
Mortgage Loan Documents and related documents and statements to the extent
held
by it hereunder, as well as all monies, held by it hereunder, and the Depositor
and the predecessor trustee or predecessor securities administrator shall
execute and deliver such instruments and do such other things as may reasonably
be required for more fully and certainly vesting and confirming in the successor
trustee or successor securities administrator all such rights, powers, duties
and obligations.
No
successor trustee or successor securities administrator shall accept appointment
as provided in this Section unless at the time of such acceptance such successor
trustee or successor securities administrator shall be eligible under the
provisions of Section 9.06 and the appointment of such successor trustee or
successor securities administrator shall not result in a downgrading of any
Class of Certificates by any Rating Agency, as evidenced by a letter from each
Rating Agency.
216
Upon
acceptance of appointment by a successor trustee or successor securities
administrator as provided in this Section, the Depositor shall mail notice
of
the succession of such trustee hereunder to all Holders of Certificates at
their
addresses as shown in the Certificate Register. If the Depositor fails to mail
such notice within ten (10) days after acceptance of appointment by the
successor trustee or successor securities administrator, the successor trustee
or successor securities administrator shall cause such notice to be mailed
at
the expense of the Depositor.
SECTION
9.09. Merger
or
Consolidation of Trustee or Securities Administrator.
Any
corporation or association into which the Trustee or the Securities
Administrator may be merged or converted or with which it may be consolidated
or
any corporation or association resulting from any merger, conversion or
consolidation to which the Trustee or the Securities Administrator shall be
a
party, or any corporation or association succeeding to the business of the
Trustee or the Securities Administrator shall be the successor of the Trustee
or
the Securities Administrator hereunder, provided such corporation or association
shall be eligible under the provisions of Section 9.06, without the execution
or
filing of any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding.
SECTION
9.10. Appointment
of Co-Trustee or Separate Trustee.
Notwithstanding
any other provisions hereof, at any time, for the purpose of meeting any legal
requirements of any jurisdiction in which any part of the REMIC I or property
securing the same may at the time be located, the Trustee shall have the power
and shall execute and deliver all instruments to appoint one or more Persons
approved by the Trustee to act as co-trustee or co-trustees, jointly with the
Trustee, or separate trustee or separate trustees, of all or any part of REMIC
I, and to vest in such Person or Persons, in such capacity, and for the benefit
of the Holders of the Certificates, such title to REMIC I, or any part thereof,
and, subject to the other provisions of this Section 9.10, such powers, duties,
obligations, rights and trusts as the Trustee may consider necessary or
desirable. No co-trustee or separate trustee hereunder shall be required to
meet
the terms of eligibility as a successor trustee under Section 9.06 hereunder
and
no notice to Holders of Certificates of the appointment of co-trustee(s) or
separate trustee(s) shall be required under Section 9.08 hereof.
In
the
case of any appointment of a co-trustee or separate trustee pursuant to this
Section 9.10 all rights, powers, duties and obligations conferred or imposed
upon the Trustee shall be conferred or imposed upon and exercised or performed
by the Trustee and such separate trustee or co-trustee jointly, except to the
extent that under any law of any jurisdiction in which any particular act or
acts are to be performed by the Trustee (whether as Trustee hereunder or as
successor to a defaulting Master Servicer hereunder), the Trustee shall be
incompetent or unqualified to perform such act or acts, in which event such
rights, powers, duties and obligations (including the holding of title to REMIC
I or any portion thereof in any such jurisdiction) shall be exercised and
performed by such separate trustee or co-trustee at the direction of the
Trustee.
217
Any
notice, request or other writing given to the Trustee shall be deemed to have
been given to each of the then separate trustees and co-trustees, as effectively
as if given to each of them. Every instrument appointing any separate trustee
or
co-trustee shall refer to this Agreement and the conditions of this Article
IX.
Each separate trustee and co-trustee, upon its acceptance of the trust
conferred, shall be vested with the estates or property specified in its
instrument of appointment, either jointly with the Trustee, or separately,
as
may be provided therein, subject to all the provisions of this Agreement,
specifically including every provision of this Agreement relating to the conduct
of, affecting the liability of, or affording protection to, the Trustee. Every
such instrument shall be filed with the Trustee.
Any
separate trustee or co-trustee may, at any time, constitute the Trustee, its
agent or attorney-in-fact, with full power and authority, to the extent not
prohibited by law, to do any lawful act under or in respect of this Agreement
on
its behalf and in its name. If any separate trustee or co-trustee shall die,
become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee, to the extent permitted by law, without the appointment of a new or
successor trustee or co-trustee.
SECTION
9.11. Appointment
of Office or Agency.
The
Certificates may be surrendered for registration of transfer or exchange at
the
Securities Administrator’s office located at Xxxxx Xxxxxx xxx Xxxxxxxxx Xxxxxx,
Xxxxxxxxxxx, Xxxxxxxxx 00000, and presented for final distribution at the
Corporate Trust Office of the Securities Administrator where notices and demands
to or upon the Securities Administrator in respect of the Certificates and
this
Agreement may be served.
SECTION
9.12. Representations
and Warranties.
The
Trustee hereby represents and warrants to the Master Servicer, the Securities
Administrator, the Servicer and the Depositor as applicable, as of the Closing
Date, that:
(i) It
is a
national banking association duly organized, validly existing and in good
standing under the laws of the United States of America.
(ii) The
execution and delivery of this Agreement by it, and the performance and
compliance with the terms of this Agreement by it, will not violate its articles
of association or bylaws or constitute a default (or an event which, with notice
or lapse of time, or both, would constitute a default) under, or result in
the
breach of, any material agreement or other instrument to which it is a party
or
which is applicable to it or any of its assets.
(iii) It
has
the full power and authority to enter into and consummate all transactions
contemplated by this Agreement, has duly authorized the execution, delivery
and
performance of this Agreement, and has duly executed and delivered this
Agreement.
(iv) This
Agreement, assuming due authorization, execution and delivery by the other
parties hereto, constitutes a valid, legal and binding obligation of it,
enforceable against it in accordance with the terms hereof, subject to (A)
applicable bankruptcy, insolvency, receivership, reorganization, moratorium
and
other laws affecting the enforcement of creditors’ rights generally, and (B)
general principles of equity, regardless of whether such enforcement is
considered in a proceeding in equity or at law.
218
(v) It
is not
in violation of, and its execution and delivery of this Agreement and its
performance and compliance with the terms of this Agreement will not constitute
a violation of, any law, any order or decree of any court or arbiter, or any
order, regulation or demand of any federal, state or local governmental or
regulatory authority, which violation, in its good faith and reasonable
judgment, is likely to affect materially and adversely either the ability of
it
to perform its obligations under this Agreement or its financial
condition.
(vi) No
litigation is pending or, to the best of its knowledge, threatened against
it,
which would prohibit it from entering into this Agreement or, in its good faith
reasonable judgment, is likely to materially and adversely affect either the
ability of it to perform its obligations under this Agreement or its financial
condition.
219
ARTICLE
X
TERMINATION
XXXXXXX
00.00. Xxxxxxxxxxx
Xxxx Xxxxxxxxxx or Liquidation of All Mortgage Loans.
(a) Subject
to Section 10.02, the respective obligations and responsibilities under this
Agreement of the Depositor, the Master Servicer, the Securities Administrator,
the Servicer and the Trustee (other than the obligations of the Master Servicer
to the Trustee pursuant to Section 9.05 and of the Servicer to make remittances
to the Securities Administrator and the Securities Administrator to make
payments in respect of the REMIC I Regular Interests, REMIC I Regular Interests
or the Classes of Certificates as hereinafter set forth) shall terminate upon
payment to the Certificateholders and the deposit of all amounts held by or
on
behalf of the Trustee and required hereunder to be so paid or deposited on
the
Distribution Date coinciding with or following the earlier to occur of (i)
the
purchase by the Terminator (as defined below) of all Mortgage Loans and each
REO
Property remaining in REMIC I and (ii) the final payment or other liquidation
(or any advance with respect thereto) of the last Mortgage Loan or REO Property
remaining in REMIC I; provided, however, that in no event shall the trust
created hereby continue beyond the earlier of (i) the expiration of 21 years
from the death of the last survivor of the descendants of Xxxxxx X. Xxxxxxx,
the
late ambassador of the United States to the Court of St. Xxxxx, living on the
date hereof and (ii) the Last Scheduled Distribution Date. The purchase by
the
Terminator of all Mortgage Loans and each REO Property remaining in REMIC I
shall be at a price (the “Termination Price”) equal to the sum of (i) the
greater of (A) the aggregate Purchase Price of all the Mortgage Loans included
in REMIC I, plus the appraised value of each REO Property, if any, included
in
REMIC I, such appraisal to be conducted by an appraiser mutually agreed upon
by
the Terminator and the Trustee in their reasonable discretion and (B) the
aggregate fair market value of all of the assets of REMIC I (as determined
by
the Terminator (defined below) and the Trustee, as of the close of business
on
the third Business Day next preceding the date upon which notice of any such
termination is furnished to Certificateholders pursuant to the third paragraph
of this Section 10.01), (ii) any amounts due and owing to the Swap Provider
under the Swap Agreement and any previous swap provider as of the termination
date (including a Swap Termination Payment owed to the Swap Provider in
connection with such optional termination) plus (iii) any amounts due the
Servicer and the Master Servicer in respect of unpaid Servicing Fees, Master
Servicing Fees and outstanding P&I Advances and Servicing Advances.
(b) The
Master Servicer or, if the Master Servicer fails to exercise such optional
termination right, the Servicer (either the Master Servicer or the Servicer,
the
“Terminator”) shall have the right to purchase all of the Mortgage Loans and
each REO Property remaining in REMIC I pursuant to clause (i) of the preceding
paragraph no later than the Determination Date in the month immediately
preceding the Distribution Date on which the Certificates will be retired;
provided, however, that the Terminator may elect to purchase all of the Mortgage
Loans on a servicing retained basis and each REO Property remaining in REMIC
I
pursuant to clause (i) above only if the aggregate Scheduled Principal Balance
of the Mortgage Loans and each REO Property remaining in the Trust Fund at
the
time of such election has been reduced to less than or equal to 10% of the
aggregate Scheduled Principal Balance of the Mortgage Loans as of the Cut-off
Date. By acceptance of the Residual Certificates, the Holder of the Residual
Certificates agrees, in connection with any termination hereunder, to assign
and
transfer any portion of the Termination Price in excess of par, and to the
extent received in respect of such termination, to pay any such amounts to
the
Holders of the Class CE Certificates. Notwithstanding the foregoing, the
optional termination right may only be exercised by the Servicer if (1) the
Servicer receives written notification from the Master Servicer that the Master
Servicer will not exercise such optional termination right or (2) the Servicer
does not receive such written notification from the Master Servicer, and the
Master Servicer fails to exercise its optional termination right by the third
Distribution Date following the date such right became exercisable; provided
however, in no event shall the Servicer exercise its optional termination right
under (1) or (2) above unless it first provides written notice to the Authorized
Officers of the Sponsor that it intends to exercise such optional termination
right.
220
(c) In
connection with any optional termination, four Business Days prior to the final
Distribution Date specified in the notice required pursuant to Section 10.01(f),
the Securities Administrator shall, no later than 4:00 pm New York City time
on
such day, request in writing (in accordance with the applicable provision of
the
Swap Agreement and by phone from the Swap Provider the amount of the Estimated
Swap Termination Payment (as defined in the Swap Agreement). The Swap Provider
shall, no later than 2:00 pm on the following Business Day, notify in writing
(which may be done in electronic format) the Securities Administrator of the
amount of the Estimated Swap Termination Payment; the Securities Administrator
shall promptly on the same day notify the Terminator of the amount of the
Estimated Swap Termination Payment.
(d) Two
Business Days prior to the final Distribution Date specified in the notice
required pursuant to Section 10.01(f), (i) the Terminator shall, no
later than 1:00 pm New
York
City time on such day, deposit funds in the Distribution Account in an amount
equal to the sum of the Termination Price (other than the Swap Termination
Payment) and the Estimated Swap Termination Payment, and (ii) if the Securities
Administrator shall have determined that the aggregate Scheduled Principal
Balance of all of the Mortgage Loans as of the related Determination Date is
not
more than 10% of the aggregate Principal Balance of the Mortgage
Loans
as of
the Cut-off Date and that all other requirements of the optional termination
have been met, including without limitation, the deposit required pursuant
to
the immediately preceding clause (i) as well as the requirements specified
in
Section 10.03, then the Securities Administrator shall, on the same Business
Day, provide written notice to the Depositor, the Master Servicer, the Servicer,
the Supplemental Interest Trust Trustee, the Trustee and the Swap Provider
confirming (in accordance with the applicable provisions of the Swap Agreement)
(a) its receipt of the Termination Price (other than the Swap Termination
Payment) and the Estimated Swap Termination Payment and (b) that all other
requirements of the optional termination have been met. Upon the Securities
Administrator’s providing the notice described in the preceding sentence, the
optional termination shall become irrevocable, the notice to Certificateholders
of such optional termination provided pursuant to the Section 10.01(f) shall
become unrescindable, the Swap Provider shall determine the Swap Termination
Payment in accordance with the Swap Agreement, and the Swap Provider shall
provide to the Securities Administrator written notice of the amount of the
Swap
Termination Payment not later than one Business Day prior to the final
Distribution Date specified in the notice required pursuant to Section
10.01(f).
221
(e) In
connection with any optional termination, only an amount equal to the
Termination Price less any Swap Termination Payment shall be made available
for
distribution to the Regular Certificates. Any Estimated Swap Termination Payment
deposited into the Distribution Account by the Terminator shall be withdrawn
by
the Securities Administrator from the Distribution Account on the related final
Distribution Date and distributed as follows: (i) to the Supplemental Interest
Trust for payment to the Swap Provider in accordance with Section 5.07, an
amount equal to the Swap Termination Payment calculated pursuant to the Swap
Agreement, provided that in no event shall the amount distributed to the Swap
Provider in respect of the Swap Termination Payment exceed the Estimated Swap
Termination Payment, and (ii) to the Terminator an amount equal to the excess,
if any, of the Estimated Swap Termination Payment over the Swap Termination
Payment. The Swap Termination Payment shall not be part of any REMIC and shall
not be paid into any account which is part of any REMIC.
(f) Notice
of
the liquidation of the Certificates shall be given promptly by the Securities
Administrator by letter to the Certificateholders mailed (a) in the event such
notice is given in connection with the purchase of the Mortgage Loans and each
REO Property by the Master Servicer, not earlier than the 15th day and not
later
than the 25th day of the month next preceding the month of the final
distribution on the Certificates or (b) otherwise during the month of such
final
distribution on or before the Determination Date in such month, in each case
specifying (i) the Distribution Date upon which the Trust Fund will terminate
and the final payment in respect of the REMIC I Regular Interests or the
Certificates will be made upon presentation and surrender of the related
Certificates at the office of the Securities Administrator therein designated,
(ii) the amount of any such final payment, (iii) that no interest shall accrue
in respect of the REMIC I Regular Interests or the Certificates from and after
the Interest Accrual Period relating to the final Distribution Date therefor
and
(iv) that the Record Date otherwise applicable to such Distribution Date is
not
applicable, payments being made only upon presentation and surrender of the
Certificates at the office of the Securities Administrator. In the event such
notice is given in connection with the purchase of all of the Mortgage Loans
and
each REO Property remaining in REMIC I by the Terminator, the Terminator shall
deliver to the Securities Administrator for deposit in the Distribution Account
not later than the Business Day prior to the Distribution Date on which the
final distribution on the Certificates an amount in immediately available funds
equal to the above-described Termination Price. The Securities Administrator
shall remit to the Servicer, the Master Servicer, the Trustee and the Custodian
from such funds deposited in the Distribution Account (i) any amounts which
the
Servicer would be permitted to withdraw and retain from the Collection Account
pursuant to Section 3.09 as if such funds had been deposited therein (including
all unpaid Servicing Fees, Master Servicing Fees and all outstanding P&I
Advances and Servicing Advances) and (ii) any other amounts otherwise payable
by
the Securities Administrator to the Master Servicer, the Trustee, the Custodian,
the Swap Provider and the Servicer from amounts on deposit in the Distribution
Account pursuant to the terms of this Agreement prior to making any final
distributions pursuant to Section 10.01(d) below. Upon certification to the
Trustee by the Securities Administrator of the making of such final deposit,
the
Trustee shall promptly release or cause to be released to the Terminator the
Mortgage Files for the remaining Mortgage Loans, and Trustee shall execute
all
assignments, endorsements and other instruments delivered to it and necessary
to
effectuate such transfer.
222
(g) Upon
presentation of the Certificates by the Certificateholders on the final
Distribution Date, the Securities Administrator shall distribute to each
Certificateholder so presenting and surrendering its Certificates the amount
otherwise distributable on such Distribution Date in accordance with Section
5.01 in respect of the Certificates so presented and surrendered. Any funds
not
distributed to any Holder or Holders of Certificates being retired on such
Distribution Date because of the failure of such Holder or Holders to tender
their Certificates shall, on such date, be set aside and held in trust and
credited to the account of the appropriate non-tendering Holder or Holders.
If
any Certificates as to which notice has been given pursuant to this Section
10.01 shall not have been surrendered for cancellation within six months after
the time specified in such notice, the Securities Administrator shall mail
a
second notice to the remaining non-tendering Certificateholders to surrender
their Certificates for cancellation in order to receive the final distribution
with respect thereto. If within one year after the second notice all such
Certificates shall not have been surrendered for cancellation, the Securities
Administrator shall, directly or through an agent, mail a final notice to the
remaining non-tendering Certificateholders concerning surrender of their
Certificates. The costs and expenses of maintaining the funds in trust and
of
contacting such Certificateholders shall be paid out of the assets remaining
in
the trust funds. If within one (1) year after the final notice any such
Certificates shall not have been surrendered for cancellation, the Securities
Administrator shall pay to the Depositor all such amounts, and all rights of
non-tendering Certificateholders in or to such amounts shall thereupon cease.
No
interest shall accrue or be payable to any Certificateholder on any amount
held
in trust by the Securities Administrator as a result of such Certificateholder’s
failure to surrender its Certificate(s) on the final Distribution Date for
final
payment thereof in accordance with this Section 10.01. Any such amounts held
in
trust by the Securities Administrator shall be held uninvested in an Eligible
Account.
SECTION
10.02. Additional
Termination Requirements.
(a) In
the
event that the Terminator purchases all the Mortgage Loans and each REO Property
or the final payment on or other liquidation of the last Mortgage Loan or REO
Property remaining in REMIC I pursuant to Section 10.01, the Trust Fund shall
be
terminated in accordance with the following additional
requirements:
(i) The
Securities Administrator shall specify the first day in the 90-day liquidation
period in a statement attached to each Trust REMIC’s final Tax Return pursuant
to Treasury regulation Section 1.860F-1 and shall satisfy all requirements
of a
qualified liquidation under Section 860F of the Code and any regulations
thereunder, as evidenced by an Opinion of Counsel obtained by and at the expense
of the Terminator;
(ii) During
such 90-day liquidation period and, at or prior to the time of making of the
final payment on the Certificates, the Trustee shall sell all of the assets
of
REMIC I to the Terminator for cash; and
(iii) At
the
time of the making of the final payment on the Certificates, the Securities
Administrator shall distribute or credit, or cause to be distributed or
credited, to the Holders of the Residual Certificates all cash on hand in the
Trust Fund (other than cash retained to meet claims), and the Trust Fund shall
terminate at that time.
223
(b) At
the
expense of the Terminator (or, if the Trust Fund is being terminated as a result
of the occurrence of the event described in clause (ii) of the first paragraph
of Section 10.01, at the expense of the Trust Fund), the Terminator shall
prepare or cause to be prepared the documentation required in connection with
the adoption of a plan of liquidation of each Trust REMIC pursuant to this
Section 10.02.
(c) By
their
acceptance of Certificates, the Holders thereof hereby agree to authorize the
Securities Administrator to specify the 90-day liquidation period for each
Trust
REMIC, which authorization shall be binding upon all successor
Certificateholders.
224
ARTICLE
XI
REMIC
PROVISIONS
SECTION
11.01. REMIC
Administration.
(a) The
Securities Administrator shall elect to treat each Trust REMIC as a REMIC under
the Code and, if necessary, under applicable state law. Each such election
will
be made by the Securities Administrator on Form 1066 or other appropriate
federal tax or information return or any appropriate state return for the
taxable year ending on the last day of the calendar year in which the
Certificates are issued. For the purposes of the REMIC election in respect
of
REMIC I, the REMIC I Regular Interests shall be designated as the “regular
interests” in REMIC I and the Class R-I Interest shall be designated as the
“Residual Interests” in REMIC I. For the purposes of the REMIC election in
respect of REMIC II, the REMIC II Regular Interests shall be designated as
the
“Regular Interests” in REMIC II and the Class R-II Interest shall be designated
as the “Residual Interests” in REMIC II. The Class A Certificates, the Mezzanine
Certificates, the Class P Certificates, Class IO Interest and the Class CE
Certificates (exclusive of any right to receive payments from or obligation
to
make payments to the Reserve Fund or the Supplement Interest Trust) shall be
designated as the “Regular Interests” in REMIC III and the Class R-III Interest
shall be designated as the “Residual Interests” in REMIC III. The Trustee shall
not permit the creation of any “interests” in each Trust REMIC (within the
meaning of Section 860G of the Code) other than the REMIC I Regular Interests,
REMIC II Regular Interests, Class IO Interest and the interests represented
by
the Certificates.
(b) The
Closing Date is hereby designated as the “Startup Day” of each Trust REMIC
within the meaning of Section 860G(a)(9) of the Code.
(c) The
Securities Administrator shall be reimbursed for any and all expenses relating
to any tax audit of the Trust Fund (including, but not limited to, any
professional fees or any administrative or judicial proceedings with respect
to
each Trust REMIC that involve the Internal Revenue Service or state tax
authorities), including the expense of obtaining any tax related Opinion of
Counsel except as specified herein. The Securities Administrator, as agent
for
each Trust REMIC’s tax matters person shall (i) act on behalf of the Trust Fund
in relation to any tax matter or controversy involving any Trust REMIC and
(ii)
represent the Trust Fund in any administrative or judicial proceeding relating
to an examination or audit by any governmental taxing authority with respect
thereto. The holder of the largest Percentage Interest of each Class of Residual
Certificates shall be designated, in the manner provided under Treasury
regulations section 1.860F-4(d) and Treasury regulations section
301.6231(a)(7)-1, as the tax matters person of the related REMIC created
hereunder. By their acceptance thereof, the holder of the largest Percentage
Interest of the Residual Certificates hereby agrees to irrevocably appoint
the
Securities Administrator or an Affiliate as its agent to perform all of the
duties of the tax matters person for the Trust Fund.
(d) The
Securities Administrator shall prepare and file and the Trustee shall sign
all
of the Tax Returns in respect of each REMIC created hereunder. The expenses
of
preparing and filing such returns shall be borne by the Securities Administrator
without any right of reimbursement therefor.
225
(e) The
Securities Administrator shall perform on behalf of each Trust REMIC all
reporting and other tax compliance duties that are the responsibility of such
REMIC under the Code, the REMIC Provisions or other compliance guidance issued
by the Internal Revenue Service or any state or local taxing authority. Among
its other duties, as required by the Code, the REMIC Provisions or other such
compliance guidance, the Securities Administrator shall provide (i) to any
Transferor of a Residual Certificate such information as is necessary for the
application of any tax relating to the transfer of a Residual Certificate to
any
Person who is not a Permitted Transferee upon receipt of additional reasonable
compensation, (ii) to the Certificateholders such information or reports as
are
required by the Code or the REMIC Provisions including reports relating to
interest, original issue discount and market discount or premium (using the
Prepayment Assumption as required) and (iii) to the Internal Revenue Service
the
name, title, address and telephone number of the person who will serve as the
representative of each Trust REMIC. The Depositor shall provide or cause to
be
provided to the Securities Administrator, within ten (10) days after the Closing
Date, all information or data that the Securities Administrator reasonably
determines to be relevant for tax purposes as to the valuations and issue prices
of the Certificates, including, without limitation, the price, yield, prepayment
assumption and projected cash flow of the Certificates.
(f) To
the
extent in the control of the Trustee or the Securities Administrator, each
such
Person (i) shall take such action and shall cause each REMIC created hereunder
to take such action as shall be necessary to create or maintain the status
thereof as a REMIC under the REMIC Provisions, (ii) shall not take any action,
cause the Trust Fund to take any action or fail to take (or fail to cause to
be
taken) any action that, under the REMIC Provisions, if taken or not taken,
as
the case may be, could (A) endanger the status of each Trust REMIC as a REMIC
or
(B) result in the imposition of a tax upon the Trust Fund (including but not
limited to the tax on prohibited transactions as defined in Section 860F(a)(2)
of the Code and the tax on contributions to a REMIC set forth in Section 860G(d)
of the Code) (either such event, an “Adverse REMIC Event”) unless such action or
inaction is permitted under this Agreement or the Trustee and the Securities
Administrator have received an Opinion of Counsel, addressed to the them (at
the
expense of the party seeking to take such action but in no event at the expense
of the Trustee or the Securities Administrator) to the effect that the
contemplated action will not, with respect to any Trust REMIC, endanger such
status or result in the imposition of such a tax, nor (iii) shall the Securities
Administrator take or fail to take any action (whether or not authorized
hereunder) as to which the Trustee has advised it in writing that it has
received an Opinion of Counsel to the effect that an Adverse REMIC Event could
occur with respect to such action; provided that the Securities Administrator
may conclusively rely on such Opinion of Counsel and shall incur no liability
for its action or failure to act in accordance with such Opinion of Counsel.
In
addition, prior to taking any action with respect to any Trust REMIC or the
respective assets of each, or causing any Trust REMIC to take any action, which
is not contemplated under the terms of this Agreement, the Securities
Administrator will consult with the Trustee or its designee, in writing, with
respect to whether such action could cause an Adverse REMIC Event to occur
with
respect to any Trust REMIC, and the Securities Administrator shall not take
any
such action or cause any Trust REMIC to take any such action as to which the
Trustee has advised it in writing that an Adverse REMIC Event could occur.
The
Trustee may consult with counsel (and conclusively rely upon the advice of
such
counsel) to make such written advice, and the cost of same shall be borne by
the
party seeking to take the action not permitted by this Agreement, but in no
event shall such cost be an expense of the Trustee.
226
(g) In
the
event that any tax is imposed on “prohibited transactions” of any REMIC created
hereunder as defined in Section 860F(a)(2) of the Code, on the “net income from
foreclosure property” of such REMIC as defined in Section 860G(c) of the Code,
on any contributions to any such REMIC after the Startup Day therefor pursuant
to Section 860G(d) of the Code, or any other tax is imposed by the Code or
any
applicable provisions of state or local tax laws, such tax shall be charged
(i)
to the Trustee pursuant to Section 11.03, if such tax arises out of or results
from a breach by the Trustee of any of its obligations under this Article XI,
(ii) to the Securities Administrator pursuant to Section 11.03, if such tax
arises out of or results from a breach by the Securities Administrator of any
of
its obligations under this Article XI, (iii) to the Master Servicer pursuant
to
Section 11.03, if such tax arises out of or results from a breach by the Master
Servicer of any of its obligations under Article IV or under this Article XI,
(iv) to the Servicer pursuant to Section 11.03, if such tax arises out of or
results from a breach by the Servicer of any of its obligations under Article
III or under this Article XI, or (v) in all other cases, against amounts on
deposit in the Distribution Account and shall be paid by withdrawal
therefrom.
(h) The
Securities Administrator shall, for federal income tax purposes, maintain books
and records with respect to each Trust REMIC on a calendar year and on an
accrual basis.
(i) Following
the Startup Day, neither the Securities Administrator nor the Trustee shall
accept any contributions of assets to any Trust REMIC other than in connection
with any Qualified Substitute Mortgage Loan delivered in accordance with Section
2.03 unless it shall have received an Opinion of Counsel to the effect that
the
inclusion of such assets in the Trust Fund will not cause the related REMIC
to
fail to qualify as a REMIC at any time that any Certificates are outstanding
or
subject such REMIC to any tax under the REMIC Provisions or other applicable
provisions of federal, state and local law or ordinances.
(j) Neither
the Trustee nor the Securities Administrator shall knowingly enter into any
arrangement by which any Trust REMIC will receive a fee or other compensation
for services nor permit either REMIC to receive any income from assets other
than “qualified mortgages” as defined in Section 860G(a)(3) of the Code or
“permitted investments” as defined in Section 860G(a)(5) of the
Code.
(k) The
Securities Administrator shall apply for an employer identification number
with
the Internal Revenue Service via a Form SS-4 or other comparable method for
each
REMIC. In connection with the foregoing, the Securities Administrator shall
provide the name and address of the person who can be contacted to obtain
information required to be reported to the holders of Regular Interests in
each
REMIC as required by IRS Form 8811.
SECTION
11.02. Prohibited
Transactions and Activities.
None
of
the Depositor, the Servicer, the Securities Administrator, the Master Servicer
or the Trustee shall sell, dispose of or substitute for any of the Mortgage
Loans (except in connection with (i) the foreclosure of a Mortgage Loan,
including but not limited to, the acquisition or sale of a Mortgaged Property
acquired by deed in lieu of foreclosure, (ii) the bankruptcy of REMIC I, (iii)
the termination of REMIC I pursuant to Article X of this Agreement, (iv) a
substitution pursuant to Article II of this Agreement or (v) a purchase of
Mortgage Loans pursuant to Article II of this Agreement), nor acquire any assets
for any Trust REMIC (other than REO Property acquired in respect of a defaulted
Mortgage Loan), nor sell or dispose of any investments in the Collection Account
or the Distribution Account for gain, nor accept any contributions to any Trust
REMIC after the Closing Date (other than a Qualified Substitute Mortgage Loan
delivered in accordance with Section 2.03), unless it has received an Opinion
of
Counsel, addressed to the Trustee and the Securities Administrator (at the
expense of the party seeking to cause such sale, disposition, substitution,
acquisition or contribution but in no event at the expense of the Trustee)
that
such sale, disposition, substitution, acquisition or contribution will not
(a)
affect adversely the status of any Trust REMIC as a REMIC or (b) cause any
Trust
REMIC to be subject to a tax on “prohibited transactions” or “contributions”
pursuant to the REMIC Provisions.
227
SECTION
11.03. Indemnification.
(a) The
Trustee agrees to be liable for any taxes and costs incurred by the Trust Fund,
the Depositor, the Master Servicer, the Securities Administrator or the Servicer
including, without limitation, any reasonable attorneys fees imposed on or
incurred by the Trust Fund, the Depositor, the Master Servicer, the Securities
Administrator or the Servicer as a result of the Trustee’s failure to perform
its covenants set forth in this Article XI in accordance with the standard
of
care of the Trustee set forth in this Agreement.
(b) The
Servicer agrees to indemnify the Trust Fund, the Depositor, the Master Servicer,
the Securities Administrator and the Trustee for any taxes and costs including,
without limitation, any reasonable attorneys’ fees imposed on or incurred by the
Trust Fund, the Depositor, the Master Servicer, the Securities Administrator
or
the Trustee, as a result of the Servicer’s failure to perform its covenants set
forth in Article III in accordance with the standard of care of the Servicer
set
forth in this Agreement.
(c) The
Master Servicer agrees to indemnify the Trust Fund, the Depositor, the Servicer
and the Trustee for any taxes and costs including, without limitation, any
reasonable attorneys’ fees imposed on or incurred by the Trust Fund, the
Depositor, the Servicer or the Trustee, as a result of the Master Servicer’s
failure to perform its covenants set forth in Article IV in accordance with
the
standard of care of the Master Servicer set forth in this
Agreement.
(d) The
Securities Administrator agrees to be liable for any taxes and costs incurred
by
the Trust Fund, the Depositor, the Servicer or the Trustee including, without
limitation, any reasonable attorneys’ fees imposed on or incurred by the Trust
Fund, the Depositor, the Servicer or the Trustee as a result of the Securities
Administrator’s failure to perform its covenants set forth in this Article XI in
accordance with the standard of care of the Securities Administrator set forth
in this Agreement.
228
ARTICLE
XII
MISCELLANEOUS
PROVISIONS
SECTION
12.01. Amendment.
This
Agreement may be amended from time to time by the Depositor, the Servicer,
the
Master Servicer, the Securities Administrator and the Trustee but without the
consent of any of the Certificateholders, (i) to cure any ambiguity or defect,
(ii) to correct, modify or supplement any provisions herein (including to give
effect to the expectations of Certificateholders), (iii) to ensure compliance
with Regulation AB or (iv) to make any other provisions with respect to matters
or questions arising under this Agreement which shall not be inconsistent with
the provisions of this Agreement and that such action shall not, as evidenced
by
an Opinion of Counsel delivered to the Trustee, adversely affect in any material
respect the interests of any Certificateholder; provided that any such amendment
shall be deemed not to adversely affect in any material respect the interests
of
the Certificateholders and no such Opinion of Counsel shall be required if
the
Person requesting such amendment obtains a letter from each Rating Agency
stating that such amendment would not result in the downgrading or withdrawal
of
the respective ratings then assigned to the Certificates. No amendment shall
be
deemed to adversely affect in any material respect the interests of any
Certificateholder who shall have consented thereto, and no Opinion of Counsel
shall be required to address the effect of any such amendment on any such
consenting Certificateholder.
This
Agreement may also be amended from time to time by the Depositor, the Servicer,
the Master Servicer, the Securities Administrator and the Trustee with the
consent of the Holders of Certificates entitled to at least 66% of the Voting
Rights for the purpose of adding any provisions to or changing in any manner
or
eliminating any of the provisions of this Agreement or of modifying in any
manner the rights of the Holders of Certificates; provided, however, that no
such amendment shall (i) reduce in any manner the amount of, or delay the timing
of, payments received on Mortgage Loans which are required to be distributed
on
any Certificate without the consent of the Holder of such Certificate, (ii)
adversely affect in any material respect the interests of the Holders of any
Class of Certificates in a manner, other than as described in (i), without
the
consent of the Holders of Certificates of such Class evidencing at least 66%
of
the Voting Rights allocated to such Class, or (iii) modify the consents required
by the immediately preceding clauses (i) and (ii) without the consent of the
Holders of all Certificates then outstanding. Notwithstanding any other
provision of this Agreement, for purposes of the giving or withholding of
consents pursuant to this Section 12.01, Certificates registered in the name
of
the Depositor or the Servicer or any Affiliate thereof shall be entitled to
Voting Rights with respect to matters affecting such Certificates. Without
limiting the generality of the foregoing, any amendment to this Agreement
required in connection with the compliance with or the clarification of any
reporting obligations described in Section 5.06 hereof shall not require the
consent of any Certificateholder and without the need for any Opinion of Counsel
or Rating Agency confirmation.
Notwithstanding
any contrary provision of this Agreement, the Trustee shall not consent to
any
amendment to this Agreement unless it shall have first received an Opinion
of
Counsel to the effect that such amendment is permitted hereunder, that all
conditions precedent to the execution of such amendment by the Trustee have
been
satisfied and such amendment will not result in the imposition of any tax on
any
Trust REMIC pursuant to the REMIC Provisions or cause any Trust REMIC to fail
to
qualify as a REMIC at any time that any Certificates are outstanding.
229
Promptly
after the execution of any such amendment the Trustee shall furnish a copy
of
such amendment to each Certificateholder.
It
shall
not be necessary for the consent of Certificateholders under this Section 12.01
to approve the particular form of any proposed amendment, but it shall be
sufficient if such consent shall approve the substance thereof. The manner
of
obtaining such consents and of evidencing the authorization of the execution
thereof by Certificateholders shall be subject to such reasonable regulations
as
the Trustee may prescribe.
The
cost
of any Opinion of Counsel to be delivered pursuant to this Section 12.01 shall
be borne by the Person seeking the related amendment, but in no event shall
such
Opinion of Counsel be an expense of the Trustee.
The
Trustee may, but shall not be obligated to enter into any amendment pursuant
to
this Section that affects its rights, duties and immunities under this Agreement
or otherwise.
Notwithstanding
any of the other provisions of this Section 12.01, none of the parties to this
Agreement shall enter into any amendment to this Agreement that could reasonably
be expected to have a material adverse effect on the interests of the Swap
Provider hereunder (excluding, for the avoidance of doubt, any amendment to
this
Agreement that is entered into solely for the purpose of appointing a successor
servicer, master servicer, securities administrator, trustee or other service
provider) without the prior written consent of the Swap Provider, which consent
shall not be unreasonably withheld, conditioned or delayed.
SECTION
12.02. Recordation
of Agreement; Counterparts.
To
the
extent permitted by applicable law, this Agreement is subject to recordation
in
all appropriate public offices for real property records in all the counties
or
other comparable jurisdictions in which any or all of the properties subject
to
the Mortgages are situated, and in any other appropriate public recording office
or elsewhere, such recordation to be effected by the Depositor at the expense
of
the Certificateholders, but only upon direction of the Trustee accompanied
by an
Opinion of Counsel (which Opinion of Counsel shall not be at the expense of
the
Trustee) to the effect that such recordation materially and beneficially affects
the interests of the Certificateholders.
For
the
purpose of facilitating the recordation of this Agreement as herein provided
and
for other purposes, this Agreement may be executed simultaneously in any number
of counterparts, each of which counterparts shall be deemed to be an original,
and such counterparts shall constitute but one and the same
instrument.
230
SECTION
12.03. Limitation
on Rights of Certificateholders.
The
death
or incapacity of any Certificateholder shall not operate to terminate this
Agreement or the Trust Fund, nor entitle such Certificateholder’s legal
representatives or heirs to claim an accounting or to take any action or
proceeding in any court for a partition or winding up of the Trust Fund, nor
otherwise affect the rights, obligations and liabilities of the parties hereto
or any of them.
No
Certificateholder shall have any right to vote (except as expressly provided
for
herein) or in any manner otherwise control the operation and management of
the
Trust Fund, or the obligations of the parties hereto, nor shall anything herein
set forth, or contained in the terms of any of the Certificates, be construed
so
as to constitute the Certificateholders from time to time as partners or members
of an association; nor shall any Certificateholder be under any liability to
any
third person by reason of any action taken by the parties to this Agreement
pursuant to any provision hereof.
No
Certificateholder shall have any right by virtue of any provision of this
Agreement to institute any suit, action or proceeding in equity or at law upon
or under or with respect to this Agreement, unless such Holder previously shall
have given to the Trustee a written notice of default and of the continuance
thereof, as hereinbefore provided, and unless also the Holders of Certificates
entitled to at least 25% of the Voting Rights shall have made written request
upon the Trustee to institute such action, suit or proceeding in its own name
as
Trustee hereunder and shall have offered to the Trustee such reasonable
indemnity as it may require against the costs, expenses and liabilities to
be
incurred therein or thereby, and the Trustee, for 15 days after its receipt
of
such notice, request and offer of indemnity, shall have neglected or refused
to
institute any such action, suit or proceeding. It is understood and intended,
and expressly covenanted by each Certificateholder with every other
Certificateholder. and the Trustee, that no one or more Holders of Certificates
shall have any right in any manner whatsoever by virtue of any provision of
this
Agreement to affect, disturb or prejudice the rights of the Holders of any
other
of such Certificates, or to obtain or seek to obtain priority over or preference
to any other such Holder, or to enforce any right under this Agreement, except
in the manner herein provided and for the equal, ratable and common benefit
of
all Certificateholders. For the protection and enforcement of the provisions
of
this Section, each and every Certificateholder and the Trustee shall be entitled
to such relief as can be given either at law or in equity.
SECTION
12.04. Governing
Law.
This
Agreement shall be construed in accordance with the laws of the State of New
York and the obligations, rights and remedies of the parties hereunder shall
be
determined in accordance with such laws without regard to conflicts of laws
principles thereof other than Section 5-1401 of the New York General Obligations
Law which shall govern.
SECTION
12.05. Notices.
All
directions, demands and notices hereunder shall be in writing and shall be
deemed to have been duly given when received if sent by facsimile, receipt
confirmed, if personally delivered at or mailed by first class mail, postage
prepaid, or by express delivery service or delivered in any other manner
specified herein, to (a) in the case of the Depositor, ACE Securities Corp.,
AMACAR GROUP, 0000 Xxxxxxxx Xxxxxxxxx, Xxxxx 000, Xxxxxxxxx, Xxxxx Xxxxxxxx
00000, Attention: Xxxxxxx Xxxxxxx (telecopy number: (000) 000-0000) with a
copy
to Deutsche Bank Securities, Inc. 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, Attention:
Legal Department (telecopy number: (000) 000-0000), or such other address or
telecopy number as may hereafter be furnished to the Servicer, the Master
Servicer, the Securities Administrator and the Trustee in writing by the
Depositor, (b) in the case of the Servicer, Ocwen Loan Servicing, LLC, 0000
Xxxxxxxxxxx Xxxx, Xxxxxxxxxx Xxxx, Xxxxx 000, Xxxx Xxxx Xxxxx, Xxxxxxx 00000,
Attention: Secretary (telecopy number: (000) 000-0000, or such other address
or
telecopy number as may hereafter be furnished to the Trustee, the Master
Servicer, the Securities Administrator and the Depositor in writing by the
Servicer, (c) in the case of the Master Servicer and the Securities
Administrator, X.X. Xxx 00, Xxxxxxxx, Xxxxxxxx 00000 and for overnight delivery
to 0000 Xxx Xxxxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxx 00000, Attention: Ace Securities
Corp., 2007-WM2 (telecopy number: (000) 000-0000), or such other address or
telecopy number as may hereafter be furnished to the Trustee, the Depositor
and
the Servicer in writing by the Master Servicer or the Securities Administrator
and (d) in the case of the Trustee, at the Corporate Trust Office or such other
address or telecopy number as the Trustee may hereafter be furnish to the
Servicer, the Master Servicer, the Securities Administrator and the Depositor
in
writing by the Trustee. Any notice required or permitted to be given to a
Certificateholder shall be given by first class mail, postage prepaid, at the
address of such Holder as shown in the Certificate Register. Any notice so
mailed within the time prescribed in this Agreement shall be conclusively
presumed to have been duly given when mailed, whether or not the
Certificateholder receives such notice. A copy of any notice required to be
telecopied hereunder also shall be mailed to the appropriate party in the manner
set forth above.
231
SECTION
12.06. Severability
of Provisions.
If
any
one or more of the covenants, agreements, provisions or terms of this Agreement
shall be for any reason whatsoever held invalid, then such covenants,
agreements, provisions or terms shall be deemed severable from the remaining
covenants, agreements, provisions or terms of this Agreement and shall in no
way
affect the validity or enforceability of the other provisions of this Agreement
or of the Certificates or the rights of the Holders thereof.
SECTION
12.07. Notice
to
Rating Agencies.
The
Trustee shall use its best efforts promptly to provide notice to the Rating
Agencies with respect to each of the following of which a Responsible Officer
has actual knowledge:
1. Any
material change or amendment to this Agreement;
2. The
occurrence of any Servicer Event of Default or Master Servicer Event of Default
that has not been cured or waived;
3. The
resignation or termination of the Servicer, the Master Servicer or the
Trustee;
232
4. The
repurchase or substitution of Mortgage Loans pursuant to or as contemplated
by
Section 2.03;
5. The
final
payment to the Holders of any Class of Certificates; and
6. Any
change in the location of the Distribution Account.
In
addition, the Securities Administrator shall promptly make available to each
Rating Agency copies of each report to Certificateholders described in Section
5.02.
The
Servicer shall make available to each Rating Agency copies of the
following:
1. Each
annual statement of compliance described in Section 3.17 of this Agreement;
and
2. Each
assessment of compliance and attestation report described in
Section 3.18.
Any
such
notice pursuant to this Section 12.07 shall be in writing and shall be deemed
to
have been duly given if personally delivered at or mailed by first class mail,
postage prepaid, or by express delivery service to Standard & Poor’s, a
division of the XxXxxx-Xxxx Companies, Inc., 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx
00000; and to Xxxxx’x Investors Service, Inc., 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000 or such other addresses as the Rating Agencies may designate in
writing to the parties hereto.
SECTION
12.08. Article
and Section References.
All
article and section references used in this Agreement, unless otherwise
provided, are to articles and sections in this Agreement.
SECTION
12.09. Grant
of
Security Interest.
It
is the
express intent of the parties hereto that the conveyance of the Mortgage Loans
by the Depositor to the Trustee, on behalf of the Trust and for the benefit
of
the Certificateholders, be, and be construed as, a sale of the Mortgage Loans
by
the Depositor and not a pledge of the Mortgage Loans to secure a debt or other
obligation of the Depositor. However, in the event that, notwithstanding the
aforementioned intent of the parties, the Mortgage Loans are held to be property
of the Depositor, then, (a) it is the express intent of the parties that such
conveyance be deemed a pledge of the Mortgage Loans by the Depositor to the
Trustee, on behalf of the Trust and for the benefit of the Certificateholders,
to secure a debt or other obligation of the Depositor and (b)(1) this Agreement
shall also be deemed to be a security agreement within the meaning of Articles
8
and 9 of the Uniform Commercial Code as in effect from time to time in the
State
of New York; (2) the conveyance provided for in Section 2.01 shall be deemed
to
be a grant by the Depositor to the Trustee, on behalf of the Trust and for
the
benefit of the Certificateholders, of a security interest in all of the
Depositor’s right, title and interest in and to the Mortgage Loans and all
amounts payable to the holders of the Mortgage Loans in accordance with the
terms thereof and all proceeds of the conversion, voluntary or involuntary,
of
the foregoing into cash, instruments, securities or other property, including
without limitation all amounts, other than investment earnings, from time to
time held or invested in the Collection Account and the Distribution Account,
whether in the form of cash, instruments, securities or other property; (3)
the
obligations secured by such security agreement shall be deemed to be all of
the
Depositor’s obligations under this Agreement, including the obligation to
provide to the Certificateholders the benefits of this Agreement relating to
the
Mortgage Loans and the Trust Fund; and (4) notifications to persons holding
such
property, and acknowledgments, receipts or confirmations from persons holding
such property, shall be deemed notifications to, or acknowledgments, receipts
or
confirmations from, financial intermediaries, bailees or agents (as applicable)
of the Trustee for the purpose of perfecting such security interest under
applicable law. Accordingly, the Depositor hereby grants to the Trustee, on
behalf of the Trust and for the benefit of the Certificateholders, a security
interest in the Mortgage Loans and all other property described in clause (2)
of
the preceding sentence, for the purpose of securing to the Trustee the
performance by the Depositor of the obligations described in clause (3) of
the
preceding sentence. Notwithstanding the foregoing, the parties hereto intend
the
conveyance pursuant to Section 2.01 to be a true, absolute and unconditional
sale of the Mortgage Loans and assets constituting the Trust Fund by the
Depositor to the Trustee, on behalf of the Trust and for the benefit of the
Certificateholders.
233
SECTION
12.10. Survival
of Indemnification.
Any
and
all indemnities to be provided by any party to this Agreement shall survive
the
termination and resignation of any party hereto and the termination of this
Agreement.
SECTION
12.11. Intention
of the Parties and Interpretation.
Each
of
the parties acknowledges and agrees that the purpose of Sections 3.17, 3.18,
3.20, 4.15, 4.16, 4.17, 4.18 and 5.06 of this Agreement is to facilitate
compliance by the Sponsor, the Master Servicer, the Securities Administrator
and
the Depositor with the provisions of Regulation AB promulgated by the Commission
under the Exchange Act (17 C.F.R. §§ 229.1100 - 229.1123), as such may be
amended from time to time and subject to clarification and interpretive advice
as may be issued by the staff of the Commission from time to time. Therefore,
each of the parties agrees that (a) the obligations of the parties hereunder
shall be interpreted in such a manner as to accomplish that purpose, (b) the
parties’ obligations hereunder will be supplemented and modified as necessary to
be consistent with any such amendments, interpretive advice or guidance,
convention or consensus among active participants in the asset-backed securities
markets, advice of counsel, or otherwise in respect of the requirements of
Regulation AB and (c) the parties shall comply with requests made by the Master
Servicer, Securities Administrator, Sponsor or the Depositor for delivery of
additional or different information as the Master Servicer, Securities
Administrator, Sponsor or the Depositor may determine in good faith is necessary
to comply with the provisions of Regulation AB.
SECTION
12.12. Indemnification.
Each
of
the Depositor, Master Servicer, Securities Administrator, Servicer and any
Servicing Function Participant engaged by such party, respectively, shall
indemnify and hold harmless the Master Servicer, the Securities Administrator
and the Depositor, respectively, and each of its directors, officers, employees,
agents, and affiliates from and against any and all claims, losses, damages,
penalties, fines, forfeitures, reasonable legal fees and related costs,
judgments and other costs and expenses arising out of or based upon (a) any
breach by such party of any if its obligations under hereunder, including
particularly its obligations to provide any assessment of compliance,
attestation report, annual statement of compliance or any information, data
or
materials required to be included in any 1934 Act report, (b) any material
misstatement or omission in any information, data or materials provided by
such
party (or, in the case of the Securities Administrator or Master Servicer,
any
material misstatement or material omission in (i) any assessment of compliance,
attestation report or annual statement of compliance delivered by it, or by
any
Servicing Function Participant engaged by it, pursuant to this Agreement, or
(ii) any Additional Form 10-D Disclosure, Additional Form 10-K Disclosure or
Form 8-K Disclosure concerning the Master Servicer or the Securities
Administrator), or (c) the negligence, bad faith or willful misconduct of such
indemnifying party in connection with its performance hereunder. If the
indemnification provided for herein is unavailable or insufficient to hold
harmless the Master Servicer, the Securities Administrator or the Depositor,
as
the case may be, then each such party agrees that it shall contribute to the
amount paid or payable by the Master Servicer, the Securities Administrator
or
the Depositor, as applicable, as a result of any claims, losses, damages or
liabilities incurred by such party in such proportion as is appropriate to
reflect the relative fault of the indemnified party on the one hand and the
indemnifying party on the other. This indemnification shall survive the
termination of this Agreement or the termination of any party to this
Agreement.
234
SECTION
12.13. Swap
Provider as a Third Party Beneficiary.
The
Swap
Provider shall be an express third-party beneficiary of this Agreement to the
extent of its express rights to receive any payments under this Agreement or
any
other express rights of the Swap Provider explicitly stated in this Agreement,
and shall have the right to enforce such rights under this Agreement as if
it
were a party hereto.
235
IN
WITNESS WHEREOF, the Depositor, the Servicer, the Master Servicer, the
Securities Administrator and the Trustee have caused their names to be signed
hereto by their respective officers thereunto duly authorized, in each case
as
of the day and year first above written.
ACE
SECURITIES CORP.,
as
Depositor
By:
/s/:
Xxxxxx Xxxxxxxxxx
Name:
Xxxxxx Xxxxxxxxxx
Title:
Vice President
By:
/s/:
Xxxxx X. Xxxxx
Name:
Xxxxx X. Xxxxx
Title:
Vice President
OCWEN
LOAN SERVICING, LLC
as
Servicer
By:
/s/:
Xxxxxxx Xxxxxxxx
Name:
Xxxxxxx Xxxxxxxx
Title:
Director
HSBC
BANK
USA, NATIONAL ASSOCIATION
not
in
its individual capacity but solely as Trustee
By:
/s/:
Xxxxxxxx Xxxxxxx
Name:
Xxxxxxxx Xxxxxxx
Title:
Vice President
XXXXX
FARGO BANK, NATIONAL ASSOCIATION
as
Master
Servicer and Securities Administrator
By:
/s/:
Xxxxxx X. Xxxxxx
Name:
Xxxxxx X. Xxxxxx
Title:
Vice President
Acknowledged
and Agreed for purposes of
Section
9.05:
DB
STRUCTURED PRODUCTS, INC
By:
/s/:
Xxxxx Xxxxxxxxx
Name:
Xxxxx Xxxxxxxxx
Title:
Director
By:
/s/:
Xxxxx Xxxxxxx
Name:
Xxxxx Xxxxxxx
Title:
Director
Acknowledged
and Agreed for purposes of
Sections
7.08, 7.09 and 7.10:
XXXXXXX
FIXED INCOME SERVICES INC.
By:
/s/:
Xxxxx X. Xxxxxxx
Name:
Xxxxx X. Xxxxxxx
Title:
President and General Counsel
|
STATE
OF NORTH CAROLINA
|
)
|
|
)
ss.:
|
|
|
COUNTY
OF MECKLENBURG
|
)
|
On
the
28th day of March 2007, before me, a notary public in and for said State,
personally appeared Xxxxxx Xxxxxxxxxx known to me to be an officer of ACE
Securities Corp., one of the entities that executed the within instrument,
and
also known to me to be the person who executed it on behalf of said corporation,
and acknowledged to me that such corporation executed the within
instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the
day and year in this certificate first above written.
|
/s/
Xxxxxxx X.
Xxxxxx
|
|
|
Notary
Public
|
|
| [Notarial Seal] | My commission expires 0-0-0000 |
|
XXXXX
XX XXXXX XXXXXXXX
|
)
|
|
)
ss.:
|
|
|
COUNTY
OF MECKLENBURG
|
)
|
On
the
28th day of March 2007, before me, a notary public in and for said State,
personally appeared Xxxxx X. Xxxxx known to me to be an officer of ACE
Securities Corp., one of the entities that executed the within instrument,
and
also known to me to be the person who executed it on behalf of said corporation,
and acknowledged to me that such corporation executed the within
instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the
day and year in this certificate first above written.
|
/s/
Xxxxxxx X.
Xxxxxx
|
|
|
Notary
Public
|
|
| [Notarial Seal] | My commission expires 0-0-0000 |
|
XXXXX
XX XXXXXXX
|
)
|
|
)
ss.:
|
|
|
COUNTY
OF PALM BEACH
|
)
|
On
the
30th day of March 2007, before me, a notary public in and for said State,
personally appeared Xxxxxxx Xxxxxxxx known to me to be a director of Ocwen
Loan
Servicing, LLC, one of the entities that executed the within instrument, and
also known to me to be the person who executed it on behalf of said entity,
and
acknowledged to me that such entity executed the within instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the
day and year in this certificate first above written.
|
/s/
K. S.
Ferruggia
|
|
|
Notary
Public
|
|
| [Notarial Seal] | My commission expires 0-0-0000 |
|
XXXXX
XX XXXXXXXX
|
)
|
|
)
ss.:
|
|
|
COUNTY
OF XXXXXX
|
)
|
On
the
30th
day of
March 2007, before me, a notary public in and for said State, personally
appeared Xxxxxx X. Xxxxxx known to me to be a Vice President of Xxxxx Fargo
Bank, National Association, one of the entities that executed the within
instrument, and also known to me to be the person who executed it on behalf
of
said national banking association, and acknowledged to me that such national
banking association executed the within instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the
day and year in this certificate first above written.
|
/s/
Xxxxxx X.
Xxxxxx
|
|
|
Notary
Public
|
|
| [Notarial Seal] | My commission expires 00-00-0000 |
|
XXXXX
XX XXX XXXX
|
)
|
|
)
ss.:
|
|
|
COUNTY
OF NEW YORK
|
)
|
On
the
30th day of March 2007, before me, a notary public in and for said State,
personally appeared Xxxxxxxx Xxxxxxx known to me to be a Vice President of
HSBC
Bank USA, National Association, one of the entities that executed the within
instrument, and also known to me to be the person who executed it on behalf
of
said national banking association, and acknowledged to me that such national
banking association executed the within instrument.
IN
WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal the
day and year in this certificate first above written.
|
/s/
Xxxxxx X. Xxxxxxxxx
|
|
|
Notary
Public
|
|
| [Notarial Seal] | My commission expires 1-16-2011 |
EXHIBIT
A-1
FORM
OF
CLASS A-[1][2A][2B][2C][2D] CERTIFICATE
SOLELY
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A “REGULAR INTEREST”
IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT,” AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986,
AS
AMENDED (THE “CODE”).
UNLESS
THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY TO THE DEPOSITOR OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF
CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE & CO., ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
PRIOR
TO THE TERMINATION OF THE SUPPLEMENTAL INTEREST TRUST, ANY PERSON ACQUIRING
THIS
CERTIFICATE SHALL BE DEEMED TO HAVE MADE THE REPRESENTATIONS IN SECTION 6.02(c)
OF THE AGREEMENT REFERRED TO HEREIN.
A-1-1
|
Series
2007-WM2, Class A-[1][2A][2B][2C][2D]
|
Aggregate
Certificate Principal Balance of the
Class
A-[1][2A][2B][2C][2D] Certificates as of
the
Issue Date: $_____________
|
|
|
Pass-Through
Rate: Variable
|
Denomination:
$____________
|
|
|
Date
of Pooling and Servicing Agreement and
Cut-off
Date: March 1, 2007
|
Master
Servicer: Xxxxx Fargo Bank, N.A.
|
|
|
First
Distribution Date: April 25, 2007
|
Trustee:
HSBC Bank USA, National Association
|
|
|
No.
__
|
Issue
Date: March 30, 2007
|
|
|
CUSIP:
________________
|
DISTRIBUTIONS
IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE MAY BE
MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE OUTSTANDING CERTIFICATE
PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN THE AMOUNT SHOWN ABOVE
AS
THE DENOMINATION OF THIS CERTIFICATE.
ASSET
BACKED PASS-THROUGH CERTIFICATE
evidencing
a beneficial ownership interest in a Trust Fund (the “Trust Fund”) consisting
primarily of a pool of conventional one- to four-family, first and second lien,
fixed and adjustable-rate mortgage loans (the “Mortgage Loans”) formed and sold
by
ACE
SECURITIES CORP.
THIS
CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ACE SECURITIES
CORP., THE SPONSOR, THE MASTER SERVICER, THE SECURITIES ADMINISTRATOR, THE
SERVICER, THE TRUSTEE OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS
CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR
INSTRUMENTALITY OF THE UNITED STATES.
This
certifies that ________________ is the registered owner of a Percentage Interest
(obtained by dividing the denomination of this Certificate by the aggregate
Certificate Principal Balance of the Class A-[1][2A][2B][2C][2D] Certificates
as
of the Issue Date) in that certain beneficial ownership interest evidenced
by
all of the Class A-[1][2A][2B][2C][2D] Certificates in REMIC III created
pursuant to a Pooling and Servicing Agreement, dated as specified above (the
“Agreement”), among ACE Securities Corp. as depositor (hereinafter called the
“Depositor”, which term includes any successor entity under the Agreement),
Xxxxx Fargo Bank, N.A. as master servicer (the “Master Servicer”) and securities
administrator (the “Securities Administrator”), Ocwen Loan Servicing, LLC as
servicer (the “Servicer”) and HSBC Bank USA, National Association as trustee
(the “Trustee”), a summary of certain of the pertinent provisions of which is
set forth hereafter. To the extent not defined herein, the capitalized terms
used herein have the meanings assigned in the Agreement. This Certificate is
issued under and is subject to the terms, provisions and conditions of the
Agreement, to which Agreement the Holder of this Certificate by virtue of the
acceptance hereof assents and by which such Holder is bound.
A-1-2
Pursuant
to the terms of the Agreement, distributions will be made on the 25th
day of
each month or, if such 25th
day is
not a Business Day, the Business Day immediately following such 25th
day (a
“Distribution Date”), commencing on the First Distribution Date specified above,
to the Person in whose name this Certificate is registered on the Business
Day
immediately preceding such Distribution Date (the “Record Date”), in an amount
equal to the product of the Percentage Interest evidenced by this Certificate
and the amount required to be distributed to the Holders of Class
A-[1][2A][2B][2C][2D] Certificates on such Distribution Date pursuant to the
Agreement.
All
distributions to the Holder of this Certificate under the Agreement will be
made
or caused to be made by the Securities Administrator by wire transfer in
immediately available funds to the account of the Person entitled thereto if
such Person shall have so notified the Securities Administrator in writing
at
least five (5) Business Days prior to the Record Date immediately prior to
such
Distribution Date and is the registered owner of Class A-[1][2A][2B][2C][2D]
Certificates the aggregate initial Certificate Principal Balance of which is
in
excess of the lesser of (i) $5,000,000 or (ii) two-thirds of the aggregate
initial Certificate Principal Balance of the Class A-[1][2A][2B][2C][2D]
Certificates, or otherwise by check mailed by first class mail to the address
of
the Person entitled thereto, as such name and address shall appear on the
Certificate Register. Notwithstanding the above, the final distribution on
this
Certificate will be made after due notice by the Securities Administrator of
the
pendency of such distribution and only upon presentation and surrender of this
Certificate at the office or agency appointed by the Securities Administrator
for that purpose as provided in the Agreement.
The
Pass-Through Rate applicable to the calculation of interest payable with respect
to this Certificate on any Distribution Date shall be a rate per annum equal
to
the lesser of (i) One-Month LIBOR plus [_____]%, in the case of each
Distribution Date through and including the first Distribution Date on which
the
aggregate principal balance of the Mortgage Loans (and properties acquired
in
respect thereof) remaining in the Trust Fund as of the last day of the related
Due Period has been reduced to less than or equal to 10% of the aggregate
principal balance of the Mortgage Loans as of the Cut-off Date, or One-Month
LIBOR plus [_____]%, in the case of any Distribution Date thereafter and (ii)
the applicable Net WAC Pass-Through Rate for such Distribution
Date.
This
Certificate is one of a duly authorized issue of Certificates designated as
Asset Backed Pass-Through Certificates of the Series specified on the face
hereof (herein called the “Certificates”) and representing a Percentage Interest
in the Class of Certificates specified on the face hereof equal to the
denomination specified on the face hereof divided by the aggregate Certificate
Principal Balance of the Class of Certificates specified on the face
hereof.
The
Certificates are limited in right of payment to certain collections and
recoveries respecting the Mortgage Loans and payments received pursuant to
the
Swap Agreement and the [Group I] [Group II] Cap Contract, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made,
or
certain expenses incurred, with respect to the Mortgage Loans.
A-1-3
The
Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Depositor,
the
Master Servicer, the Trustee, the Securities Administrator, the Servicer and
the
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Trustee, the Securities Administrator and
the Servicer with the consent of the Swap Provider (with respect to matters
affecting the Swap Agreement) and the Holders of Certificates entitled to at
least 66% of the Voting Rights. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of
such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders
of
any of the Certificates.
As
provided in the Agreement and subject to certain limitations therein set forth,
the transfer of this Certificate is registrable in the Certificate Register
upon
surrender of this Certificate for registration of transfer at the offices or
agencies appointed by the Securities Administrator as provided in the Agreement,
duly endorsed by, or accompanied by an assignment in the form below or other
written instrument of transfer in form satisfactory to the Securities
Administrator duly executed by the Holder hereof or such Holder’s attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or
transferees.
The
Certificates are issuable in fully registered form only without coupons in
Classes and denominations representing Percentage Interests specified in the
Agreement. As provided in the Agreement and subject to certain limitations
therein set forth, the Certificates are exchangeable for new Certificates of
the
same Class in authorized denominations evidencing the same aggregate Percentage
Interest, as requested by the Holder surrendering the same.
Prior
to
the termination of the Supplemental Interest Trust, any person acquiring this
Certificate shall be deemed to have made the representations in Section 6.02(c)
of the Agreement.
No
service charge will be made for any such registration of transfer or exchange
of
Certificates, but the Securities Administrator may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed
in
connection with any transfer or exchange of Certificates.
The
Depositor, the Master Servicer, the Trustee, the Securities Administrator,
the
Servicer and any agent of the Depositor, the Master Servicer, the Trustee,
the
Securities Administrator or the Servicer may treat the Person in whose name
this
Certificate is registered as the owner hereof for all purposes, and none of
the
Depositor, the Master Servicer, the Trustee, the Securities Administrator,
the
Servicer nor any such agent shall be affected by notice to the
contrary.
A-1-4
The
obligations created by the Agreement and the Trust Fund created thereby shall
terminate upon payment to the Certificateholders of all amounts held by the
Securities Administrator and required to be paid to them pursuant to the
Agreement following the earlier of (i) the final payment or other liquidation
(or any advance with respect thereto) of the last Mortgage Loan remaining in
REMIC I and (ii) the purchase by the party designated in the Agreement at a
price determined as provided in the Agreement from REMIC I of all the Mortgage
Loans and all property acquired in respect of such Mortgage Loans. The Agreement
permits, but does not require, the party designated in the Agreement to purchase
from REMIC I all the Mortgage Loans and all property acquired in respect of
any
Mortgage Loan at a price determined as provided in the Agreement. The exercise
of such right will effect early retirement of the Certificates; however, such
right to purchase is subject to the aggregate Scheduled Principal Balance of
the
Mortgage Loans (and properties acquired in respect thereof) at the time of
purchase being less than or equal to 10% of the aggregate principal balance
of
the Mortgage Loans as of the Cut-off Date.
The
recitals contained herein shall be taken as statements of the Depositor and
neither the Trustee nor the Securities Administrator assumes any responsibility
for their correctness.
Unless
the certificate of authentication hereon has been executed by the Securities
Administrator, by manual signature, this Certificate shall not be entitled
to
any benefit under the Agreement or be valid for any purpose.
A-1-5
IN
WITNESS WHEREOF, the Securities Administrator has caused this Certificate to
be
duly executed.
Dated:
|
XXXXX
FARGO BANK, N.A.
as
Securities Administrator
|
|||||||||||||
|
By:
________________________________________
|
|||||||||||||
|
Authorized
Officer
|
|||||||||||||
CERTIFICATE
OF AUTHENTICATION
This
is
one of the Class A-[1][2A][2B][2C][2D] Certificates referred to in the
within-mentioned Agreement.
|
XXXXX
FARGO BANK, N.A.
as
Securities Administrator
|
|||||||||||||
|
By:
_____________________________________
|
|||||||||||||
|
Authorized
Signatory
|
|||||||||||||
A-1-6
ABBREVIATIONS
The
following abbreviations, when used in the inscription on the face of this
instrument, shall be construed as though they were written out in full according
to applicable laws or regulations:
|
TEN
COM
|
- |
as
tenants in common
|
UNIF
GIFT MIN ACT -
|
Custodian
(Cust)
(Minor)
under
Uniform Gifts
to
Minors Act
|
|
TEN
ENT
|
- |
as
tenants by the entireties
|
________________
(State)
|
|
|
JT
TEN
|
- |
as
joint tenants with right
if
survivorship and not as
tenants
in common
|
||
|
Additional
abbreviations may also be used though not in the above
list.
|
||||
ASSIGNMENT
|
FOR
VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)
|
|
|
unto
|
|
(Please
print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a
Percentage Interest equal to ____%
evidenced by the within Asset Backed Pass-Through Certificate and hereby
authorize(s) the registration of transfer of such interest to assignee on the
Certificate Register of the Trust Fund.
I
(we)
further direct the Securities Administrator to issue a new Certificate of a
like
Percentage Interest and Class to the above named assignee and deliver such
Certificate to the following address:
________________________________________________
_________________________________________________________________.
|
Dated:
|
____________________________________ |
|
Signature
by or on behalf of assignor
|
|
| ____________________________________ | |
|
Signature
Guaranteed
|
A-1-7
DISTRIBUTION
INSTRUCTIONS
The
assignee should include the following for purposes of distribution:
Distributions
shall be made, by wire transfer or otherwise, in immediately available
funds
to
_____________________________________________________________________________________________________
____________________________________________________________________________________________________________
for
the
account of
______________________________________________________________________________________________
account
number
________________________________________________________________________
or,
if
mailed by check, to
___________________________________________________________________________________________________________
Applicable
statements should be mailed to
___________________________________________________________________________
____________________________________________________________________________________________________________
This
information is provided by
______________________________________________________________________________
assignee
named above, or
________________________________________________________________________________________
its
agent.
X-0-0
XXXXXXX
X-0
FORM
OF
CLASS M-[1][2][3][4][5][6][7][8][9] CERTIFICATE
SOLELY
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A “REGULAR INTEREST”
IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT,” AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986,
AS
AMENDED (THE “CODE”).
UNLESS
THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY TO THE DEPOSITOR OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF
CEDE & CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY AND ANY PAYMENT IS MADE TO CEDE & CO., ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THIS
CERTIFICATE IS SUBORDINATE TO THE CLASS A CERTIFICATES [[,/AND] CLASS M-1
CERTIFICATES [,/AND] CLASS M-2 CERTIFICATES [,/AND] CLASS M-3 CERTIFICATES
[,/AND] CLASS M-4 CERTIFICATES [,/AND] CLASS M-5 CERTIFICATES [,/AND] CLASS
M-6
CERTIFICATES [,/AND] CLASS M-7 CERTIFICATES [AND] CLASS M-8 CERTIFICATES] TO
THE
EXTENT DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.
ANY
TRANSFEREE OF THIS CERTIFICATE SHALL BE DEEMED TO MAKE THE REPRESENTATIONS
SET
FORTH IN SECTION 6.02(c) OF THE AGREEMENT REFERRED TO
HEREIN.
THE
CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE WILL BE DECREASED BY THE
PRINCIPAL PAYMENTS HEREON AND REALIZED LOSSES ALLOCABLE HERETO AS DESCRIBED
IN
THE AGREEMENT REFERRED TO HEREIN. ACCORDINGLY, FOLLOWING THE INITIAL ISSUANCE
OF
THE CERTIFICATES, THE CERTIFICATE PRINCIPAL BALANCE OF THIS CERTIFICATE WILL
BE
DIFFERENT FROM THE DENOMINATION SHOWN BELOW. ANYONE ACQUIRING THIS CERTIFICATE
MAY ASCERTAIN ITS CERTIFICATE PRINCIPAL BALANCE BY INQUIRY OF THE SECURITIES
ADMINISTRATOR NAMED HEREIN.
A-2-1
|
Series
2007-WM2, Class M-
[1][2][3][4][5][6][7][8][9]
|
Aggregate
Certificate Principal Balance of
the
Class M-[1][2][3][4][5][6][7][8][9]
Certificates
as of the Issue Date:
$______________
|
|
|
Pass-Through
Rate: Variable
|
Denomination:
$______________
|
|
|
Date
of Pooling and Servicing Agreement
and
Cut-off Date: March 1, 2007
|
Master
Servicer: Xxxxx Fargo Bank, N.A.
|
|
|
First
Distribution Date: April 25, 2007
|
Trustee:
HSBC Bank USA, National Association
|
|
|
No.___
|
Issue
Date: March 30, 2007
|
|
|
CUSIP:_________________
|
ASSET
BACKED PASS-THROUGH CERTIFICATE
evidencing
a beneficial ownership interest in a Trust Fund (the “Trust Fund”) consisting
primarily of a pool of conventional one- to four-family, first and second lien,
fixed and adjustable-rate mortgage loans (the “Mortgage Loans”) formed and sold
by
ACE
SECURITIES CORP.
THIS
CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ACE SECURITIES
CORP., THE SPONSOR, THE MASTER SERVICER, THE SECURITIES ADMINISTRATOR, THE
SERVICER, THE TRUSTEE OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS
CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR
INSTRUMENTALITY OF THE UNITED STATES.
This
certifies that _____________________ is the registered owner of a Percentage
Interest (obtained by dividing the denomination of this Certificate by the
aggregate Certificate Principal Balance of the Class
M-[1][2][3][4][5][6][7][8][9] Certificates as of the Issue Date) in that certain
beneficial ownership interest evidenced by all of the Class
M-[1][2][3][4][5][6][7][8][9] Certificates in REMIC III created pursuant to
a
Pooling and Servicing Agreement, dated as specified above (the “Agreement”),
among ACE Securities Corp. as depositor (hereinafter called the “Depositor”,
which term includes any successor entity under the Agreement), Xxxxx Fargo
Bank,
N.A. as master servicer (the “Master Servicer”) and securities administrator
(the “Securities Administrator”), Ocwen Loan Servicing, LLC as servicer (the
“Servicer”) and HSBC Bank USA, National Association as trustee (the “Trustee”),
a summary of certain of the pertinent provisions of which is set forth
hereafter. To the extent not defined herein, the capitalized terms used herein
have the meanings assigned in the Agreement. This Certificate is issued under
and is subject to the terms, provisions and conditions of the Agreement, to
which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
A-2-2
Pursuant
to the terms of the Agreement, distributions will be made on the 25th
day of
each month or, if such 25th
day is
not a Business Day, the Business Day immediately following such 25th
day (a
“Distribution Date”), commencing on the First Distribution Date specified above,
to the Person in whose name this Certificate is registered on the Business
Day
immediately preceding such Distribution Date (the “Record Date”), in an amount
equal to the product of the Percentage Interest evidenced by this Certificate
and the amount required to be distributed to the Holders of Class
M-[1][2][3][4][5][6][7][8][9] Certificates on such Distribution Date pursuant
to
the Agreement.
All
distributions to the Holder of this Certificate under the Agreement will be
made
or caused to be made by the Securities Administrator by wire transfer in
immediately available funds to the account of the Person entitled thereto if
such Person shall have so notified the Securities Administrator in writing
at
least five (5) Business Days prior to the Record Date immediately prior to
such
Distribution Date and is the registered owner of Class
M-[1][2][3][4][5][6][7][8][9] Certificates the aggregate initial Certificate
Principal Balance of which is in excess of the lesser of (i) $5,000,000 or
(ii)
two-thirds of the aggregate initial Certificate Principal Balance of the Class
M-[1][2][3][4][5][6][7][8][9] Certificates, or otherwise by check mailed by
first class mail to the address of the Person entitled thereto, as such name
and
address shall appear on the Certificate Register. Notwithstanding the above,
the
final distribution on this Certificate will be made after due notice by the
Securities Administrator of the pendency of such distribution and only upon
presentation and surrender of this Certificate at the office or agency appointed
by the Securities Administrator for that purpose as provided in the
Agreement.
The
Pass-Through Rate applicable to the calculation of interest payable with respect
to this Certificate on any Distribution Date shall equal a rate per annum equal
to the lesser of (i) One-Month LIBOR plus [____]% , in the case of each
Distribution Date through and including the first Distribution Date on which
the
aggregate principal balance of the Mortgage Loans (and properties acquired
in
respect thereof) remaining in the Trust Fund as of the last day of the related
Due Period has been reduced to less than or equal to 10% of the aggregate
principal balance of the Mortgage Loans as of the Cut-off Date, or One-Month
LIBOR plus [____]%, in the case of any Distribution Date thereafter and (ii)
the
applicable Net WAC Pass-Through Rate for such Distribution Date.
This
Certificate is one of a duly authorized issue of Certificates designated as
Asset Backed Pass-Through Certificates of the Series specified on the face
hereof (herein called the “Certificates”) and representing a Percentage Interest
in the Class of Certificates specified on the face hereof equal to the
denomination specified on the face hereof divided by the aggregate Certificate
Principal Balance of the Class of Certificates specified on the face
hereof.
The
Certificates are limited in right of payment to certain collections and
recoveries respecting the Mortgage Loans and payments received pursuant to
the
Swap Agreement and the Cap Contracts, all as more specifically set forth herein
and in the Agreement. As provided in the Agreement, withdrawals from the
Collection Account and the Distribution Account may be made from time to time
for purposes other than distributions to Certificateholders, such purposes
including reimbursement of advances made, or certain expenses incurred, with
respect to the Mortgage Loans.
A-2-3
The
Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Depositor,
the
Master Servicer, the Trustee, the Securities Administrator, the Servicer and
the
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Trustee, the Securities Administrator and
the Servicer with the consent of the Swap Provider (with respect to matters
affecting the Swap Agreement) and the Holders of Certificates entitled to at
least 66% of the Voting Rights. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of
such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders
of
any of the Certificates.
As
provided in the Agreement and subject to certain limitations therein set forth,
the transfer of this Certificate is registrable in the Certificate Register
upon
surrender of this Certificate for registration of transfer at the offices or
agencies appointed by the Securities Administrator as provided in the Agreement,
duly endorsed by, or accompanied by an assignment in the form below or other
written instrument of transfer in form satisfactory to the Securities
Administrator duly executed by the Holder hereof or such Holder’s attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or
transferees.
The
Certificates are issuable in fully registered form only without coupons in
Classes and denominations representing Percentage Interests specified in the
Agreement. As provided in the Agreement and subject to certain limitations
therein set forth, the Certificates are exchangeable for new Certificates of
the
same Class in authorized denominations evidencing the same aggregate Percentage
Interest, as requested by the Holder surrendering the same.
Any
transferee of this Certificate shall be deemed to make the representations
set
forth in Section 6.02(c) of the Agreement.
No
service charge will be made for any such registration of transfer or exchange
of
Certificates, but the Securities Administrator may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed
in
connection with any transfer or exchange of Certificates.
The
Depositor, the Master Servicer, the Trustee, the Securities Administrator,
the
Servicer and any agent of the Depositor, the Master Servicer, the Trustee,
the
Securities Administrator or the Servicer may treat the Person in whose name
this
Certificate is registered as the owner hereof for all purposes, and none of
the
Depositor, the Master Servicer, the Trustee, the Securities Administrator,
the
Servicer nor any such agent shall be affected by notice to the
contrary.
A-2-4
The
obligations created by the Agreement and the Trust Fund created thereby shall
terminate upon payment to the Certificateholders of all amounts held by the
Securities Administrator and required to be paid to them pursuant to the
Agreement following the earlier of (i) the final payment or other liquidation
(or any advance with respect thereto) of the last Mortgage Loan remaining in
REMIC I and (ii) the purchase by the party designated in the Agreement at a
price determined as provided in the Agreement from REMIC I of all the Mortgage
Loans and all property acquired in respect of such Mortgage Loans. The Agreement
permits, but does not require, the party designated in the Agreement to purchase
from REMIC I all the Mortgage Loans and all property acquired in respect of
any
Mortgage Loan at a price determined as provided in the Agreement. The exercise
of such right will effect early retirement of the Certificates; however, such
right to purchase is subject to the aggregate Scheduled Principal Balance of
the
Mortgage Loans (and properties acquired in respect thereof) at the time of
purchase being less than or equal to 10% of the aggregate principal balance
of
the Mortgage Loans as of the Cut-off Date.
The
recitals contained herein shall be taken as statements of the Depositor and
neither the Trustee nor the Securities Administrator assume any responsibility
for their correctness.
Unless
the certificate of authentication hereon has been executed by the Securities
Administrator by manual signature, this Certificate shall not be entitled to
any
benefit under the Agreement or be valid for any purpose.
A-2-5
IN
WITNESS WHEREOF, the Securities Administrator has caused this Certificate to
be
duly executed.
Dated:
|
XXXXX
FARGO BANK, N.A.
as
Securities Administrator
|
|||||||||||||
|
By:
_____________________________________
|
|||||||||||||
|
Authorized
Officer
|
|||||||||||||
CERTIFICATE
OF AUTHENTICATION
This
is
one of the Class M-[1][2][3][4][5][6][7][8][9] Certificates referred to in
the
within-mentioned Agreement.
|
XXXXX
FARGO BANK, N.A.
as
Securities Administrator
|
|||||||||||||
|
By:
______________________________________
|
|||||||||||||
|
Authorized
Signatory
|
|||||||||||||
A-2-6
ABBREVIATIONS
The
following abbreviations, when used in the inscription on the face of this
instrument, shall be construed as though they were written out in full according
to applicable laws or regulations:
|
TEN
COM
|
- |
as
tenants in common
|
UNIF
GIFT MIN ACT -
|
Custodian
(Cust)
(Minor)
under
Uniform Gifts
to
Minors Act
|
|
TEN
ENT
|
- |
as
tenants by the entireties
|
________________
(State)
|
|
|
JT
TEN
|
- |
as
joint tenants with right
if
survivorship and not as
tenants
in common
|
||
|
Additional
abbreviations may also be used though not in the above
list.
|
||||
ASSIGNMENT
|
FOR
VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)
|
|
|
unto
|
|
(Please
print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a
Percentage Interest equal to _____% evidenced by the within Asset Backed
Pass-Through Certificate and hereby authorize(s) the registration of transfer
of
such interest to assignee on the Certificate Register of the Trust
Fund.
I
(we)
further direct the Securities Administrator to issue a new Certificate of a
like
Percentage Interest and Class to the above named assignee and deliver such
Certificate to the following address:
______________________________________________________________
______________________________________________________________________
.
|
Dated:
|
___________________________________ |
|
Signature
by or on behalf of assignor
|
|
| ___________________________________ | |
|
Signature
Guaranteed
|
A-2-7
DISTRIBUTION
INSTRUCTIONS
The
assignee should include the following for purposes of
distribution:
Distributions
shall be made, by wire transfer or otherwise, in immediately available
funds
to
_____________________________________________________________________________________________________
____________________________________________________________________________________________________________
for
the
account of
______________________________________________________________________________________________
account
number
________________________________________________________________________
or,
if
mailed by check, to
___________________________________________________________________________________________________________
Applicable
statements should be mailed to
___________________________________________________________________________
____________________________________________________________________________________________________________
This
information is provided by
______________________________________________________________________________
assignee
named above, or
________________________________________________________________________________________
its
agent.
X-0-0
XXXXXXX
X-0
FORM
OF
CLASS CE CERTIFICATE
SOLELY
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A “REGULAR INTEREST”
IN A “REAL ESTATE MORTGAGE INVESTMENT CONDUIT,” AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986,
AS
AMENDED (THE “CODE”).
THIS
CERTIFICATE IS SUBORDINATE TO THE CLASS A CERTIFICATES AND THE MEZZANINE
CERTIFICATES TO THE EXTENT DESCRIBED IN THE AGREEMENT REFERRED TO
HEREIN.
THIS
CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT
OF
1933, AS AMENDED (THE “ACT”), OR UNDER ANY STATE SECURITIES LAWS. THE HOLDER
HEREOF, BY PURCHASING THIS CERTIFICATE, AGREES THAT THIS CERTIFICATE MAY BE
REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY IN COMPLIANCE WITH
THE
ACT AND OTHER APPLICABLE LAWS AND (1) OUTSIDE OF THE UNITED STATES WITHIN THE
MEANING OF AND IN COMPLIANCE WITH REGULATION S UNDER THE ACT (“REGULATION S”),
OR (2) WITHIN THE UNITED STATES TO (A) “QUALIFIED INSTITUTIONAL BUYERS” WITHIN
THE MEANING OF AND IN COMPLIANCE WITH RULE 144A UNDER THE ACT (“RULE 144A”) OR
(B) TO INSTITUTIONAL INVESTORS THAT ARE “ACCREDITED INVESTORS” WITHIN THE
MEANING OF RULE 501(A)(1), (2), (3) OR (7) OF “REGULATION D” UNDER THE
ACT.
NO
TRANSFER OF THIS CERTIFICATE MAY BE MADE TO ANY PERSON, UNLESS THE TRANSFEREE
PROVIDES A CERTIFICATION PURSUANT TO SECTION 6.02(c) OF THE AGREEMENT AND
COMPLIES WITH SECTION 6.02(g) OF THE AGREEMENT REFERRED TO
HEREIN.
A-3-1
|
Series
2007-WM2, Class CE
|
Aggregate
Certificate Principal Balance
of
the Class CE Certificates as of the
Issue
Date: $_____________
|
|
|
Pass-Through
Rate: Variable
|
Denomination:
$_________________
|
|
|
Cut-off
Date and date of Pooling and Servicing
Agreement:
March 1, 2007
|
Master
Servicer: Xxxxx Fargo Bank, N.A.
|
|
|
First
Distribution Date: April 25, 2007
|
Trustee:
HSBC Bank USA, National Association
|
|
|
No.
__
|
Issue
Date: March 30, 2007
|
ACE
SECURITIES CORP. HOME EQUITY LOAN TRUST, SERIES 2007-WM2
ASSET
BACKED PASS-THROUGH CERTIFICATE
evidencing
a beneficial ownership interest in a Trust Fund (the “Trust Fund”) consisting
primarily of a pool of conventional one- to four-family, first and second lien,
fixed and adjustable-rate mortgage loans (the “Mortgage Loans”) formed and sold
by
ACE
SECURITIES CORP.
THIS
CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ACE SECURITIES
CORP., THE SPONSOR, THE MASTER SERVICER, THE SECURITIES ADMINISTRATOR, THE
SERVICER, THE TRUSTEE OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS
CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR
INSTRUMENTALITY OF THE UNITED STATES.
This
certifies that ________________ is the registered owner of a Percentage Interest
(obtained by dividing the denomination of this Certificate by the aggregate
Certificate Principal Balance of the Class CE Certificates as of the Issue
Date)
in that certain beneficial ownership interest evidenced by all of the Class
CE
Certificates in REMIC III created pursuant to a Pooling and Servicing Agreement,
dated as specified above (the “Agreement”), among ACE Securities Corp. as
depositor (hereinafter called the “Depositor,” which term includes any successor
entity under the Agreement), Xxxxx Fargo Bank, N.A. as master servicer (the
“Master Servicer”) and securities administrator (the “Securities
Administrator”), Ocwen Loan Servicing, LLC as servicer (the “Servicer”) and HSBC
Bank USA, National Association as trustee (the “Trustee”), a summary of certain
of the pertinent provisions of which is set forth hereafter. To the extent
not
defined herein, the capitalized terms used herein have the meanings assigned
in
the Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
A-3-2
Interest
on this Certificate will accrue during the month prior to the month in which
a
Distribution Date (as hereinafter defined) occurs on the Notional Amount (as
defined in the Agreement) hereof at a per annum rate equal to the applicable
Pass-Through Rate as set forth in the Agreement. Pursuant to the terms of the
Agreement, distributions will be made on the 25th
day of
each month or, if such 25th
day is
not a Business Day, the Business Day immediately following such 25th
day (a
“Distribution Date”), commencing on the First Distribution Date specified above,
to the Person in whose name this Certificate is registered on the last Business
Day of the calendar month immediately preceding the month in which the related
Distribution Date occurs (the “Record Date”), in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class CE Certificates on such Distribution
Date pursuant to the Agreement.
All
distributions to the Holder of this Certificate under the Agreement will be
made
or caused to be made by the Securities Administrator by wire transfer in
immediately available funds to the account of the Person entitled thereto if
such Person shall have so notified the Securities Administrator in writing
at
least five (5) Business Days prior to the Record Date immediately prior to
such
Distribution Date and is the registered owner of Class CE Certificates the
aggregate initial Certificate Principal Balance of which is in excess of the
lesser of (i) $5,000,000 or (ii) two-thirds of the aggregate initial Certificate
Principal Balance of the Class CE Certificates, or otherwise by check mailed
by
first class mail to the address of the Person entitled thereto, as such name
and
address shall appear on the Certificate Register. Notwithstanding the above,
the
final distribution on this Certificate will be made after due notice by the
Securities Administrator of the pendency of such distribution and only upon
presentation and surrender of this Certificate at the office or agency appointed
by the Securities Administrator for that purpose as provided in the
Agreement.
This
Certificate is one of a duly authorized issue of Certificates designated as
Asset Backed Pass-Through Certificates of the Series specified on the face
hereof (herein called the “Certificates”) and representing a Percentage Interest
in the Class of Certificates specified on the face hereof equal to the
denomination specified on the face hereof divided by the aggregate Certificate
Principal Balance of the Class of Certificates specified on the face
hereof.
The
Certificates are limited in right of payment to certain collections and
recoveries respecting the Mortgage Loans, all as more specifically set forth
herein and in the Agreement. As provided in the Agreement, withdrawals from
the
Collection Account and the Distribution Account may be made from time to time
for purposes other than distributions to Certificateholders, such purposes
including reimbursement of advances made, or certain expenses incurred, with
respect to the Mortgage Loans.
The
Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Depositor,
the
Master Servicer, the Trustee, the Securities Administrator, the Servicer and
the
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Trustee, the Securities Administrator and
the Servicer with the consent of the Swap Provider (with respect to matters
affecting the Swap Agreement) and the Holders of Certificates entitled to at
least 66% of the Voting Rights. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of
such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders
of
any of the Certificates.
A-3-3
As
provided in the Agreement and subject to certain limitations therein set forth,
the transfer of this Certificate is registrable in the Certificate Register
upon
surrender of this Certificate for registration of transfer at the offices or
agencies appointed by the Securities Administrator as provided in the Agreement,
duly endorsed by, or accompanied by an assignment in the form below or other
written instrument of transfer in form satisfactory to the Securities
Administrator duly executed by, the Holder hereof or such Holder’s attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or
transferees.
No
transfer of this Certificate shall be made unless the transfer is made pursuant
to an effective registration statement under the Securities Act of 1933, as
amended (the “1933 Act”), and an effective registration or qualification under
applicable state securities laws, or is made in a transaction that does not
require such registration or qualification. In the event that such a transfer
of
this Certificate is to be made without registration or qualification, the
Securities Administrator shall require receipt of (i) if such transfer is
purportedly being made in reliance upon Rule 144A under the 1933 Act, written
certifications from the Holder of the Certificate desiring to effect the
transfer, and from such Holder’s prospective transferee, substantially in the
forms attached to the Agreement as Exhibit B-1, (ii) if such transfer is
purportedly being made in reliance upon Regulation S under the 1933 Act, written
certifications from the Holder of the Certificate desiring to effect the
transfer and from such Holder’s prospective transferee, substantially in the
form attached to the Agreement as Exhibit B-2, (iii) if such transfer is
purportedly being made in reliance upon Rule 501(a) under the 1933 Act, written
certifications from the Holder of the Certificate desiring to effect the
transfer and from such Holder’s prospective transferee, substantially in the
form attached to the Agreement as Exhibit B-3 and (iv) in all other cases,
an
Opinion of Counsel satisfactory to it that such transfer may be made without
such registration or qualification (which Opinion of Counsel shall not be an
expense of the Trust Fund or of the Depositor, the Trustee, the Master Servicer
or the Securities Administrator in their respective capacities as such),
together with copies of the written certification(s) of the Holder of the
Certificate desiring to effect the transfer and/or such Holder’s prospective
transferee upon which such Opinion of Counsel is based. None of the Depositor,
the Trustee or the Securities Administrator is obligated to register or qualify
the Class of Certificates specified on the face hereof under the 1933 Act or
any
other securities law or to take any action not otherwise required under the
Agreement to permit the transfer of such Certificates without registration
or
qualification. Any Holder desiring to effect a transfer of this Certificate
shall be required to indemnify the Trustee, the Depositor, the Master Servicer
and the Securities Administrator against any liability that may result if the
transfer is not so exempt or is not made in accordance with such federal and
state laws.
No
transfer of this Certificate shall be made except in accordance with Section
6.02(c) of the Agreement.
A-3-4
The
Certificates are issuable in fully registered form only without coupons in
Classes and denominations representing Percentage Interests specified in the
Agreement. As provided in the Agreement and subject to certain limitations
therein set forth, the Certificates are exchangeable for new Certificates of
the
same Class in authorized denominations evidencing the same aggregate Percentage
Interest, as requested by the Holder surrendering the same. No service charge
will be made for any such registration of transfer or exchange of Certificates,
but the Securities Administrator may require payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in connection
with any transfer or exchange of Certificates.
The
Depositor, the Master Servicer, the Trustee, the Securities Administrator,
the
Servicer and any agent of the Depositor, the Master Servicer, the Trustee,
the
Securities Administrator or the Servicer may treat the Person in whose name
this
Certificate is registered as the owner hereof for all purposes, and none of
the
Depositor, the Master Servicer, the Trustee, the Securities Administrator,
the
Servicer nor any such agent shall be affected by notice to the
contrary.
The
obligations created by the Agreement and the Trust Fund created thereby shall
terminate upon payment to the Certificateholders of all amounts held by the
Securities Administrator and required to be paid to them pursuant to the
Agreement following the earlier of (i) the final payment or other liquidation
(or any advance with respect thereto) of the last Mortgage Loan remaining in
REMIC I and (ii) the purchase by the party designated in the Agreement at a
price determined as provided in the Agreement from REMIC I of all the Mortgage
Loans and all property acquired in respect of such Mortgage Loans. The Agreement
permits, but does not require, the party designated in the Agreement to purchase
from REMIC I all the Mortgage Loans and all property acquired in respect of
any
Mortgage Loan at a price determined as provided in the Agreement. The exercise
of such right will effect early retirement of the Certificates; however, such
right to purchase is subject to the aggregate Scheduled Principal Balance of
the
Mortgage Loans (and properties acquired in respect thereof) at the time of
purchase being less than or equal to 10% of the aggregate principal balance
of
the Mortgage Loans as of the Cut-off Date.
The
recitals contained herein shall be taken as statements of the Depositor and
neither the Trustee nor the Securities Administrator assume any responsibility
for their correctness.
Unless
the certificate of authentication hereon has been executed by the Securities
Administrator, by manual signature, this Certificate shall not be entitled
to
any benefit under the Agreement or be valid for any purpose.
A-3-5
IN
WITNESS WHEREOF, the Securities Administrator has caused this Certificate to
be
duly executed.
Dated:
|
XXXXX
FARGO BANK, N.A.
as
Securities Administrator
|
|||||||||||||
|
By:
__________________________________
|
|||||||||||||
|
Authorized
Officer
|
|||||||||||||
CERTIFICATE
OF AUTHENTICATION
This
is
one of the Class CE Certificates referred to in the within-mentioned
Agreement.
|
XXXXX
FARGO BANK, N.A.
as
Securities Administrator
|
|||||||||||||
|
By:
__________________________________
|
|||||||||||||
|
Authorized
Officer
|
|||||||||||||
A-3-6
ABBREVIATIONS
The
following abbreviations, when used in the inscription on the face of this
instrument, shall be construed as though they were written out in full according
to applicable laws or regulations:
|
TEN
COM
|
- |
as
tenants in common
|
UNIF
GIFT MIN ACT -
|
Custodian
(Cust)
(Minor)
under
Uniform Gifts
to
Minors Act
|
|
TEN
ENT
|
- |
as
tenants by the entireties
|
________________
(State)
|
|
|
JT
TEN
|
- |
as
joint tenants with right
if
survivorship and not as
tenants
in common
|
||
|
Additional
abbreviations may also be used though not in the above
list.
|
||||
ASSIGNMENT
|
FOR
VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)
|
|
|
unto
|
|
(Please
print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a
Percentage Interest equal to ____% evidenced by the within Asset Backed
Pass-Through Certificate and hereby authorize(s) the registration of transfer
of
such interest to assignee on the Certificate Register of the Trust
Fund.
I
(we)
further direct the Securities Administrator to issue a new Certificate of a
like
Percentage Interest and Class to the above named assignee and deliver such
Certificate to the following address:
______________________________________________________________
_____________________________________________________________________________
.
|
Dated:
|
_________________________________ |
|
Signature
by or on behalf of assignor
|
|
| _________________________________ | |
|
Signature
Guaranteed
|
A-3-7
DISTRIBUTION
INSTRUCTIONS
The
assignee should include the following for purposes of distribution:
Distributions
shall be made, by wire transfer or otherwise, in immediately available
funds
to
_____________________________________________________________________________________________________
____________________________________________________________________________________________________________
for
the
account of
______________________________________________________________________________________________
account
number
________________________________________________________________________
or,
if
mailed by check, to
___________________________________________________________________________________________________________
Applicable
statements should be mailed to
___________________________________________________________________________
____________________________________________________________________________________________________________
This
information is provided by
______________________________________________________________________________
assignee
named above, or
________________________________________________________________________________________
its
agent.
X-0-0
XXXXXXX
X-0
FORM
OF
CLASS P CERTIFICATE
SOLELY
FOR U.S. FEDERAL INCOME TAX PURPOSES,
THIS CERTIFICATE IS A “REGULAR INTEREST” IN A “REAL ESTATE MORTGAGE INVESTMENT
CONDUIT,” AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
“CODE”).
THIS
CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT
OF
1933, AS AMENDED (THE “ACT”), OR UNDER ANY STATE SECURITIES LAWS. THE HOLDER
HEREOF, BY PURCHASING THIS CERTIFICATE, AGREES THAT THIS CERTIFICATE MAY BE
REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY IN COMPLIANCE WITH
THE
ACT AND OTHER APPLICABLE LAWS AND (1) OUTSIDE OF THE UNITED STATES WITHIN THE
MEANING OF AND IN COMPLIANCE WITH REGULATION S UNDER THE ACT (“REGULATION S”),
OR (2) WITHIN THE UNITED STATES TO (A) “QUALIFIED INSTITUTIONAL BUYERS” WITHIN
THE MEANING OF AND IN COMPLIANCE WITH RULE 144A UNDER THE ACT (“RULE 144A”) OR
(B) TO INSTITUTIONAL INVESTORS THAT ARE “ACCREDITED INVESTORS” WITHIN THE
MEANING OF RULE 501(A)(1), (2), (3) OR (7) OF “REGULATION D” UNDER THE
ACT.
NO
TRANSFER OF THIS CERTIFICATE MAY BE MADE TO ANY PERSON, UNLESS THE TRANSFEREE
PROVIDES A CERTIFICATION PURSUANT TO SECTION 6.02(c) OF THE AGREEMENT REFERRED
TO HEREIN.
A-4-1
|
Series
2007-WM2, Class P
|
Aggregate
Certificate Principal Balance of
the
Class P Certificates as of the
Issue
Date: $100.00
|
|
|
Cut-off
Date and date of Pooling and Servicing
Agreement:
March 1, 2007
|
Denomination:
$100.00
|
|
|
First
Distribution Date: April 25, 2007
|
Master
Servicer: Xxxxx Fargo Bank, N.A.
|
|
|
No.
__
|
Trustee:
HSBC Bank USA, National Association
|
|
|
Issue
Date: March 30, 2007
|
ACE
SECURITIES CORP. HOME EQUITY LOAN TRUST, SERIES 2007-WM2
ASSET
BACKED PASS-THROUGH CERTIFICATE
evidencing
a beneficial ownership interest in a Trust Fund (the “Trust Fund”) consisting
primarily of a pool of conventional one- to four-family, first and second lien,
fixed and adjustable-rate mortgage loans (the “Mortgage Loans”) formed and sold
by
ACE
SECURITIES CORP.
THIS
CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ACE SECURITIES
CORP., THE SPONSOR, THE MASTER SERVICER, THE SECURITIES ADMINISTRATOR, THE
SERVICER, THE TRUSTEE OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS
CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR
INSTRUMENTALITY OF THE UNITED STATES.
This
certifies that____________________ is the registered owner of a Percentage
Interest (obtained by dividing the denomination of this Certificate by the
aggregate Certificate Principal Balance of the Class P Certificates as of the
Issue Date) in that certain beneficial ownership interest evidenced by all
of
the Class P Certificates in REMIC III created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the “Agreement”), among ACE
Securities Corp. as depositor (hereinafter called the “Depositor”, which term
includes any successor entity under the Agreement), Xxxxx Fargo Bank, N.A.
as
master servicer (the “Master Servicer”) and securities administrator (the
“Securities Administrator”), Ocwen Loan Servicing, LLC as servicer (the
“Servicer”) and HSBC Bank USA, National Association as trustee (the “Trustee”),
a summary of certain of the pertinent provisions of which is set forth
hereafter. To the extent not defined herein, the capitalized terms used herein
have the meanings assigned in the Agreement. This Certificate is issued under
and is subject to the terms, provisions and conditions of the Agreement, to
which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
A-4-2
Pursuant
to the terms of the Agreement, distributions will be made on the 25th
day of
each month or, if such 25th
day is
not a Business Day, the Business Day immediately following such 25th
day (a
“Distribution Date”), commencing on the First Distribution Date specified above,
to the Person in whose name this Certificate is registered on the last Business
Day of the calendar month immediately preceding the month in which the related
Distribution Date occurs (the “Record Date”), in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class P Certificates on such Distribution
Date pursuant to the Agreement.
All
distributions to the Holder of this Certificate under the Agreement will be
made
or caused to be made by the Securities Administrator by wire transfer in
immediately available funds to the account of the Person entitled thereto if
such Person shall have so notified the Securities Administrator in writing
at
least five (5) Business Days prior to the Record Date immediately prior to
such
Distribution Date and is the registered owner of Class P Certificates the
aggregate initial Certificate Principal Balance of which is in excess of the
lesser of (i) $5,000,000 or (ii) two-thirds of the aggregate initial Certificate
Principal Balance of the Class P Certificates, or otherwise by check mailed
by
first class mail to the address of the Person entitled thereto, as such name
and
address shall appear on the Certificate Register. Notwithstanding the above,
the
final distribution on this Certificate will be made after due notice by the
Securities Administrator of the pendency of such distribution and only upon
presentation and surrender of this Certificate at the office or agency appointed
by the Securities Administrator for that purpose as provided in the
Agreement.
This
Certificate is one of a duly authorized issue of Certificates designated as
Asset Backed Pass-Through Certificates of the Series specified on the face
hereof (herein called the “Certificates”) and representing a Percentage Interest
in the Class of Certificates specified on the face hereof equal to the
denomination specified on the face hereof divided by the aggregate Certificate
Principal Balance of the Class of Certificates specified on the face
hereof.
The
Certificates are limited in right of payment to certain collections and
recoveries respecting the Mortgage Loans, all as more specifically set forth
herein and in the Agreement. As provided in the Agreement, withdrawals from
the
Collection Account and the Distribution Account may be made from time to time
for purposes other than distributions to Certificateholders, such purposes
including reimbursement of advances made, or certain expenses incurred, with
respect to the Mortgage Loans.
The
Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Depositor,
the
Master Servicer, the Trustee, the Securities Administrator, the Servicer and
the
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Trustee, the Securities Administrator and
the Servicer with the consent of the Swap Provider (with respect to matters
affecting the Swap Agreement) and the Holders of Certificates entitled to at
least 66% of the Voting Rights. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of
such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders
of
any of the Certificates.
A-4-3
As
provided in the Agreement and subject to certain limitations therein set forth,
the transfer of this Certificate is registrable in the Certificate Register
upon
surrender of this Certificate for registration of transfer at the offices or
agencies appointed by the Securities Administrator as provided in the Agreement,
duly endorsed by, or accompanied by an assignment in the form below or other
written instrument of transfer in form satisfactory to the Securities
Administrator duly executed by, the Holder hereof or such Holder’s attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or
transferees.
No
transfer of this Certificate shall be made unless the transfer is made pursuant
to an effective registration statement under the Securities Act of 1933, as
amended (the “1933 Act”), and an effective registration or qualification under
applicable state securities laws, or is made in a transaction that does not
require such registration or qualification. In the event that such a transfer
of
this Certificate is to be made without registration or qualification, the
Securities Administrator shall require receipt of (i) if such transfer is
purportedly being made in reliance upon Rule 144A under the 1933 Act, written
certifications from the Holder of the Certificate desiring to effect the
transfer, and from such Holder’s prospective transferee, substantially in the
forms attached to the Agreement as Exhibit B-1, (ii) if such transfer is
purportedly being made in reliance upon Regulation S under the 1933 Act, written
certifications from the Holder of the Certificate desiring to effect the
transfer and from such Holder’s prospective transferee, substantially in the
form attached to the Agreement as Exhibit B-2, (iii) if such transfer is
purportedly being made in reliance upon Rule 501(a) under the 1933 Act, written
certifications from the Holder of the Certificate desiring to effect the
transfer and from such Holder’s prospective transferee, substantially in the
form attached to the Agreement as Exhibit B-3 and (iv) in all other cases,
an
Opinion of Counsel satisfactory to it that such transfer may be made without
such registration or qualification (which Opinion of Counsel shall not be an
expense of the Trust Fund or of the Depositor, the Trustee, the Master Servicer
or the Securities Administrator in their respective capacities as such),
together with copies of the written certification(s) of the Holder of the
Certificate desiring to effect the transfer and/or such Holder’s prospective
transferee upon which such Opinion of Counsel is based. None of the Depositor,
the Trustee or the Securities Administrator is obligated to register or qualify
the Class of Certificates specified on the face hereof under the 1933 Act or
any
other securities law or to take any action not otherwise required under the
Agreement to permit the transfer of such Certificates without registration
or
qualification. Any Holder desiring to effect a transfer of this Certificate
shall be required to indemnify the Trustee, the Depositor, the Master Servicer
and the Securities Administrator against any liability that may result if the
transfer is not so exempt or is not made in accordance with such federal and
state laws.
No
transfer of this Certificate shall be made except in accordance with Section
6.02(c) of the Agreement.
The
Certificates are issuable in fully registered form only without coupons in
Classes and denominations representing Percentage Interests specified in the
Agreement. As provided in the Agreement and subject to certain limitations
therein set forth, the Certificates are exchangeable for new Certificates of
the
same Class in authorized denominations evidencing the same aggregate Percentage
Interest, as requested by the Holder surrendering the same. No service charge
will be made for any such registration of transfer or exchange of Certificates,
but the Securities Administrator may require payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in connection
with any transfer or exchange of Certificates.
A-4-4
The
Depositor, the Master Servicer, the Trustee, the Securities Administrator,
the
Servicer and any agent of the Depositor, the Master Servicer, the Trustee,
the
Securities Administrator or the Servicer may treat the Person in whose name
this
Certificate is registered as the owner hereof for all purposes, and none of
the
Depositor, the Master Servicer, the Trustee, the Securities Administrator,
the
Servicer nor any such agent shall be affected by notice to the
contrary.
The
obligations created by the Agreement and the Trust Fund created thereby shall
terminate upon payment to the Certificateholders of all amounts held by the
Securities Administrator and required to be paid to them pursuant to the
Agreement following the earlier of (i) the final payment or other liquidation
(or any advance with respect thereto) of the last Mortgage Loan remaining in
REMIC I and (ii) the purchase by the party designated in the Agreement at a
price determined as provided in the Agreement from REMIC I of all the Mortgage
Loans and all property acquired in respect of such Mortgage Loans. The Agreement
permits, but does not require, the party designated in the Agreement to purchase
from REMIC I all the Mortgage Loans and all property acquired in respect of
any
Mortgage Loan at a price determined as provided in the Agreement. The exercise
of such right will effect early retirement of the Certificates; however, such
right to purchase is subject to the aggregate Scheduled Principal Balance of
the
Mortgage Loans (and properties acquired in respect thereof) at the time of
purchase being less than or equal to 10% of the aggregate principal balance
of
the Mortgage Loans as of the Cut-off Date.
The
recitals contained herein shall be taken as statements of the Depositor and
neither the Trustee nor the Securities Administrator assume any responsibility
for their correctness.
Unless
the certificate of authentication hereon has been executed by the Securities
Administrator, by manual signature, this Certificate shall not be entitled
to
any benefit under the Agreement or be valid for any purpose.
A-4-5
IN
WITNESS WHEREOF, the Securities Administrator has caused this Certificate to
be
duly executed.
Dated:
|
XXXXX
FARGO BANK, N.A.
as
Securities Administrator
|
|||||||||||||
|
By:
__________________________________
|
|||||||||||||
|
Authorized
Officer
|
|||||||||||||
CERTIFICATE
OF AUTHENTICATION
This
is
one of the Class P Certificates referred to in the within-mentioned
Agreement.
|
XXXXX
FARGO BANK, N.A.
as
Securities Administrator
|
|||||||||||||
|
By:
__________________________________
|
|||||||||||||
|
Authorized
Officer
|
|||||||||||||
A-4-6
ABBREVIATIONS
The
following abbreviations, when used in the inscription on the face of this
instrument, shall be construed as though they were written out in full according
to applicable laws or regulations:
|
TEN
COM
|
- |
as
tenants in common
|
UNIF
GIFT MIN ACT -
|
Custodian
(Cust)
(Minor)
under
Uniform Gifts
to
Minors Act
|
|
TEN
ENT
|
- |
as
tenants by the entireties
|
________________
(State)
|
|
|
JT
TEN
|
- |
as
joint tenants with right
if
survivorship and not as
tenants
in common
|
||
|
Additional
abbreviations may also be used though not in the above
list.
|
||||
ASSIGNMENT
|
FOR
VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)
|
|
|
unto
|
|
(Please
print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a
Percentage Interest equal to ____% evidenced by the within Asset Backed
Pass-Through Certificate and hereby authorize(s) the registration of transfer
of
such interest to assignee on the Certificate Register of the Trust
Fund.
I
(we)
further direct the Securities Administrator to issue a new Certificate of a
like
Percentage Interest and Class to the above named assignee and deliver such
Certificate to the following address:
______________________________________________________________
_______________________________________________________________
.
|
Dated:
|
___________________________ |
|
Signature
by or on behalf of assignor
|
|
| ___________________________ | |
|
Signature
Guaranteed
|
A-4-7
DISTRIBUTION
INSTRUCTIONS
The
assignee should include the following for purposes of distribution:
Distributions
shall be made, by wire transfer or otherwise, in immediately available
funds
to
_____________________________________________________________________________________________________
____________________________________________________________________________________________________________
for
the
account of
______________________________________________________________________________________________
account
number
________________________________________________________________________
or,
if
mailed by check, to
___________________________________________________________________________________________________________
Applicable
statements should be mailed to
___________________________________________________________________________
____________________________________________________________________________________________________________
This
information is provided by
______________________________________________________________________________
assignee
named above, or
________________________________________________________________________________________
its
agent.
X-0-0
XXXXXXX
X-0
FORM
OF
CLASS R CERTIFICATE
THIS
CERTIFICATE MAY NOT BE TRANSFERRED TO A NON-UNITED STATES
PERSON.
SOLELY
FOR U.S. FEDERAL INCOME TAX PURPOSES,
THIS CERTIFICATE REPRESENTS THE SOLE “RESIDUAL INTEREST” IN EACH “REAL ESTATE
MORTGAGE INVESTMENT CONDUIT” (“REMIC”), AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986,
AS
AMENDED (THE “CODE”).
ANY
RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE MADE ONLY
IN
ACCORDANCE WITH THE PROVISIONS OF SECTION 6.02 OF THE AGREEMENT REFERRED TO
HEREIN.
THIS
CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT
OF
1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE RESOLD
OR
TRANSFERRED UNLESS IT IS REGISTERED PURSUANT TO SUCH ACT AND LAWS OR IS SOLD
OR
TRANSFERRED IN TRANSACTIONS THAT ARE EXEMPT FROM REGISTRATION UNDER SUCH ACT
AND
UNDER APPLICABLE STATE LAW AND IS TRANSFERRED IN ACCORDANCE WITH THE PROVISIONS
OF SECTION 6.02 OF THE AGREEMENT REFERRED TO HEREIN.
ANY
RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CERTIFICATE MAY BE MADE ONLY
IF
THE PROPOSED TRANSFEREE PROVIDES (I) AN AFFIDAVIT TO THE SECURITIES
ADMINISTRATOR THAT (A) SUCH TRANSFEREE IS NOT (1) THE UNITED STATES OR ANY
POSSESSION THEREOF, ANY STATE OR POLITICAL SUBDIVISION THEREOF, ANY FOREIGN
GOVERNMENT, ANY INTERNATIONAL ORGANIZATION, OR ANY AGENCY OR INSTRUMENTALITY
OF
ANY OF THE FOREGOING, (2) ANY ORGANIZATION (OTHER THAN A COOPERATIVE DESCRIBED
IN SECTION 521 OF THE CODE) THAT IS EXEMPT FROM THE TAX IMPOSED BY CHAPTER
1 OF
THE CODE UNLESS SUCH ORGANIZATION IS SUBJECT TO THE TAX IMPOSED BY SECTION
511
OF THE CODE, (3) ANY ORGANIZATION DESCRIBED IN SECTION 1381(a)(2)(C) OF THE
CODE
(ANY SUCH PERSON DESCRIBED IN THE FOREGOING CLAUSES (1), (2) OR (3) SHALL
HEREINAFTER BE REFERRED TO AS A “DISQUALIFIED ORGANIZATION”) OR (4) AN AGENT OF
A DISQUALIFIED ORGANIZATION AND (B) NO PURPOSE OF SUCH TRANSFER IS TO IMPEDE
THE
ASSESSMENT OR COLLECTION OF TAX, AND (II) SUCH TRANSFEREE SATISFIES CERTAIN
ADDITIONAL CONDITIONS RELATING TO THE FINANCIAL CONDITION OF THE PROPOSED
TRANSFEREE. NOTWITHSTANDING THE REGISTRATION IN THE CERTIFICATE REGISTER OF
ANY
TRANSFER, SALE OR OTHER DISPOSITION OF THIS CERTIFICATE TO A DISQUALIFIED
ORGANIZATION OR AN AGENT OF A DISQUALIFIED ORGANIZATION, SUCH REGISTRATION
SHALL
BE DEEMED TO BE OF NO LEGAL FORCE OR EFFECT WHATSOEVER AND SUCH PERSON SHALL
NOT
BE DEEMED TO BE A CERTIFICATEHOLDER FOR ANY PURPOSE HEREUNDER, INCLUDING, BUT
NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS ON THIS CERTIFICATE. EACH HOLDER
OF
THIS CERTIFICATE BY ACCEPTANCE HEREOF SHALL BE DEEMED TO HAVE CONSENTED TO
THE
PROVISIONS OF THIS PARAGRAPH AND THE PROVISIONS OF SECTION 6.02(d) OF THE
AGREEMENT REFERRED TO HEREIN. ANY PERSON THAT IS A DISQUALIFIED ORGANIZATION
IS
PROHIBITED FROM ACQUIRING BENEFICIAL OWNERSHIP OF THIS
CERTIFICATE.
A-5-1
NO
PERSON MAY ACQUIRE THIS CERTIFICATE DIRECTLY OR INDIRECTLY BY, ON BEHALF OF,
OR
WITH PLAN ASSETS OF AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT
THAT IS SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED, OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, UNLESS
IT HAS PROVIDED THE OPINION OF COUNSEL IN SECTION 6.02(c) OF THE AGREEMENT
REFERRED TO HEREIN.
A-5-2
|
Series
2007-WM2, Class R
|
Aggregate
Percentage Interest of the
Class
R Certificates as of the
Issue
Date: 100.00%
|
|
|
Date
of Pooling and Servicing Agreement
and
Cut-off Date: March 1, 2007
|
Master
Servicer: Xxxxx Fargo Bank, N.A.
|
|
|
First
Distribution Date: April 25, 2007
|
Trustee:
HSBC Bank USA, National Association
|
|
|
No
__
|
Issue
Date: March 30, 2007
|
ACE
SECURITIES CORP. HOME EQUITY LOAN TRUST, SERIES 2007-WM2
ASSET
BACKED PASS-THROUGH CERTIFICATE
evidencing
a beneficial ownership interest in a Trust Fund (the “Trust Fund”) consisting
primarily of a pool of conventional one- to four-family, first and second lien,
fixed and adjustable-rate mortgage loans (the “Mortgage Loans”) formed and sold
by
ACE
SECURITIES CORP.
THIS
CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN ACE SECURITIES
CORP., THE SPONSOR, THE MASTER SERVICER, THE SECURITIES ADMINISTRATOR, THE
SERVICER, THE TRUSTEE OR ANY OF THEIR RESPECTIVE AFFILIATES. NEITHER THIS
CERTIFICATE NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED BY ANY AGENCY
OR
INSTRUMENTALITY OF THE UNITED STATES.
This
certifies that _______________ is the registered owner of a Percentage Interest
set forth above in that certain beneficial ownership interest evidenced by
all
of the Class R Certificates in REMIC III created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the “Agreement”), among ACE
Securities Corp. as depositor (hereinafter called the “Depositor”, which term
includes any successor entity under the Agreement), Xxxxx Fargo Bank, N.A.
as
master servicer (the “Master Servicer”) and securities administrator (the
“Securities Administrator”), Ocwen Loan Servicing, LLC as servicer (the
“Servicer”) and HSBC Bank USA, National Association as trustee (the “Trustee”),
a summary of certain of the pertinent provisions of which is set forth
hereafter. To the extent not defined herein, the capitalized terms used herein
have the meanings assigned in the Agreement. This Certificate is issued under
and is subject to the terms, provisions and conditions of the Agreement, to
which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
Pursuant
to the terms of the Agreement, distributions will be made on the 25th day of
each month or, if such 25th day is not a Business Day, the Business Day
immediately following (a “Distribution Date”), commencing on the First
Distribution Date specified above, to the Person in whose name this Certificate
is registered on the last Business Day of the calendar month immediately
preceding the month in which the related Distribution Date occurs (the “Record
Date”), in an amount equal to the product of the Percentage Interest evidenced
by this Certificate and the amount required to be distributed to the Holders
of
Class R Certificates on such Distribution Date pursuant to the
Agreement.
A-5-3
All
distributions to the Holder of this Certificate under the Agreement will be
made
or caused to be made by the Securities Administrator by wire transfer in
immediately available funds to the account of the Person entitled thereto if
such Person shall have so notified the Securities Administrator in writing
at
least five (5) Business Days prior to the Record Date immediately prior to
such
Distribution Date and is the registered owner of Class R Certificates, or
otherwise by check mailed by first class mail to the address of the Person
entitled thereto, as such name and address shall appear on the Certificate
Register. Notwithstanding the above, the final distribution on this Certificate
will be made after due notice by the Securities Administrator of the pendency
of
such distribution and only upon presentation and surrender of this Certificate
at the office or agency appointed by the Securities Administrator for that
purpose as provided in the Agreement.
This
Certificate is one of a duly authorized issue of Certificates designated as
Asset Backed Pass-Through Certificates of the Series specified on the face
hereof (herein called the “Certificates”) and representing the Percentage
Interest in the Class of Certificates specified on the face hereof.
The
Certificates are limited in right of payment to certain collections and
recoveries respecting the Mortgage Loans, all as more specifically set forth
herein and in the Agreement. As provided in the Agreement, withdrawals from
the
Collection Account and the Distribution Account may be made from time to time
for purposes other than distributions to Certificateholders, such purposes
including reimbursement of advances made, or certain expenses incurred, with
respect to the Mortgage Loans.
The
Agreement permits, with certain exceptions therein provided, the amendment
thereof and the modification of the rights and obligations of the Depositor,
the
Master Servicer, the Trustee, the Securities Administrator, the Servicer and
the
rights of the Certificateholders under the Agreement at any time by the
Depositor, the Master Servicer, the Trustee, the Securities Administrator and
the Servicer with the consent of the Swap Provider (with respect to matters
affecting the Swap Agreement) and the Holders of Certificates entitled to at
least 66% of the Voting Rights. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange herefor or in lieu hereof whether or not notation of
such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders
of
any of the Certificates.
As
provided in the Agreement and subject to certain limitations therein set forth,
the transfer of this Certificate is registrable in the Certificate Register
upon
surrender of this Certificate for registration of transfer at the offices or
agencies appointed by the Securities Administrator as provided in the Agreement,
duly endorsed by, or accompanied by an assignment in the form below or other
written instrument of transfer in form satisfactory to the Securities
Administrator duly executed by, the Holder hereof or such Holder’s attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or
transferees.
A-5-4
The
Certificates are issuable in fully registered form only without coupons in
Classes and denominations representing Percentage Interests specified in the
Agreement. As provided in the Agreement and subject to certain limitations
therein set forth, Certificates are exchangeable for new Certificates of the
same Class in authorized denominations evidencing the same aggregate Percentage
Interest, as requested by the Holder surrendering the same.
No
transfer of this Certificate shall be made unless the transfer is made pursuant
to an effective registration statement under the Securities Act of 1933, as
amended (the “1933 Act”), and an effective registration or qualification under
applicable state securities laws, or is made in a transaction that does not
require such registration or qualification. In the event that such a transfer
of
this Certificate is to be made without registration or qualification, the
Securities Administrator shall require receipt of (i) if such transfer is
purportedly being made in reliance upon Rule 144A under the 1933 Act, written
certifications from the Holder of the Certificate desiring to effect the
transfer, and from such Holder’s prospective transferee, substantially in the
forms attached to the Agreement as Exhibit B-1, (ii) if such transfer is
purportedly being made in reliance upon Rule 501(a) under the 1933 Act, written
certifications from the Holder of the Certificate desiring to effect the
transfer and from such Holder’s prospective transferee, substantially in the
form attached to the Agreement as Exhibit B-3 and a transfer affidavit and
agreement substantially in the form of Exhibit B-4 to the Agreement and (iii)
in
all other cases, an Opinion of Counsel satisfactory to it that such transfer
may
be made without such registration or qualification (which Opinion of Counsel
shall not be an expense of the Trust Fund or of the Depositor, the Trustee,
the
Master Servicer or the Securities Administrator in their respective capacities
as such), together with copies of the written certification(s) of the Holder
of
the Certificate desiring to effect the transfer and/or such Holder’s prospective
transferee upon which such Opinion of Counsel is based. None of the Depositor,
the Trustee or the Securities Administrator is obligated to register or qualify
the Class of Certificates specified on the face hereof under the 1933 Act or
any
other securities law or to take any action not otherwise required under the
Agreement to permit the transfer of such Certificates without registration
or
qualification. Any Holder desiring to effect a transfer of this Certificate
shall be required to indemnify the Trustee, the Depositor, the Master Servicer
and the Securities Administrator against any liability that may result if the
transfer is not so exempt or is not made in accordance with such federal and
state laws.
No
transfer of this Certificate shall be made except in accordance with Section
6.02 of the Agreement.
Prior
to
registration of any transfer, sale or other disposition of this Certificate,
the
proposed transferee shall provide to the Securities Administrator (i) an
affidavit to the effect that such transferee is any Person other than a
Disqualified Organization or the agent (including a broker, nominee or
middleman) of a Disqualified Organization, and (ii) a certificate that
acknowledges that (A) the Class R Certificates have been designated as
representing the beneficial ownership of the residual interests in each of
REMIC
I, REMIC II and REMIC III, (B) it will include in its income a pro
rata
share of
the net income of the Trust Fund and that such income may be an “excess
inclusion,” as defined in the Code, that, with certain exceptions, cannot be
offset by other losses or benefits from any tax exemption, and (C) it expects
to
have the financial means to satisfy all of its tax obligations including those
relating to holding the Class R Certificates. Notwithstanding the registration
in the Certificate Register of any transfer, sale or other disposition of this
Certificate to a Disqualified Organization or an agent (including a broker,
nominee or middleman) of a Disqualified Organization, such registration shall
be
deemed to be of no legal force or effect whatsoever and such Person shall not
be
deemed to be a Certificateholder for any purpose, including, but not limited
to,
the receipt of distributions in respect of this Certificate.
A-5-5
The
Holder of this Certificate, by its acceptance hereof, shall be deemed to have
consented to the provisions of Section 6.02 of the Agreement and to any
amendment of the Agreement deemed necessary by counsel of the Depositor to
ensure that the transfer of this Certificate to any Person other than a
Permitted Transferee or any other Person will not cause any portion of the
Trust
Fund to cease to qualify as a REMIC or cause the imposition of a tax upon any
REMIC.
No
service charge will be made for any such registration of transfer or exchange
of
Certificates, but the Securities Administrator may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed
in
connection with any transfer or exchange of Certificates.
The
Depositor, the Master Servicer, the Trustee, the Securities Administrator,
the
Servicer and any agent of the Depositor, the Master Servicer, the Trustee,
the
Securities Administrator or the Servicer may treat the Person in whose name
this
Certificate is registered as the owner hereof for all purposes, and none of
the
Depositor, the Master Servicer, the Trustee, the Securities Administrator,
the
Servicer nor any such agent shall be affected by notice to the
contrary.
The
obligations created by the Agreement and the Trust Fund created thereby shall
terminate upon payment to the Certificateholders of all amounts held by the
Securities Administrator and required to be paid to them pursuant to the
Agreement following the earlier of (i) the final payment or other liquidation
(or any advance with respect thereto) of the last Mortgage Loan remaining in
REMIC I and (ii) the purchase by the party designated in the Agreement at a
price determined as provided in the Agreement from REMIC I of all the Mortgage
Loans and all property acquired in respect of such Mortgage Loans. The Agreement
permits, but does not require, the party designated in the Agreement to purchase
from REMIC I all the Mortgage Loans and all property acquired in respect of
any
Mortgage Loan at a price determined as provided in the Agreement. The exercise
of such right will effect early retirement of the Certificates; however, such
right to purchase is subject to the aggregate Scheduled Principal Balance of
the
Mortgage Loans (and properties acquired in respect thereof) at the time of
purchase being less than or equal to 10% of the aggregate principal balance
of
the Mortgage Loans as of the Cut-off Date.
A-5-6
The
recitals contained herein shall be taken as statements of the Depositor and
neither the Trustee nor the Securities Administrator assume any responsibility
for their correctness.
Unless
the certificate of authentication hereon has been executed by the Securities
Administrator, by manual signature, this Certificate shall not be entitled
to
any benefit under the Agreement or be valid for any purpose.
A-5-7
IN
WITNESS WHEREOF, the Securities Administrator has caused this Certificate to
be
duly executed.
Dated:
|
XXXXX
FARGO BANK, N.A.
as
Securities Administrator
|
|||||||||||||
|
By:
_______________________________
|
|||||||||||||
|
Authorized
Officer
|
|||||||||||||
CERTIFICATE
OF AUTHENTICATION
This
is
one of the Class R Certificates referred to in the within-mentioned
Agreement.
|
XXXXX
FARGO BANK, N.A.
as
Securities Administrator
|
|||||||||||||
|
By:
_______________________________
|
|||||||||||||
|
Authorized
Signatory
|
|||||||||||||
A-5-8
ABBREVIATIONS
The
following abbreviations, when used in the inscription on the face of this
instrument, shall be construed as though they were written out in full according
to applicable laws or regulations:
|
TEN
COM
|
- |
as
tenants in common
|
UNIF
GIFT MIN ACT -
|
Custodian
(Cust)
(Minor)
under
Uniform Gifts
to
Minors Act
|
|
TEN
ENT
|
- |
as
tenants by the entireties
|
________________
(State)
|
|
|
JT
TEN
|
- |
as
joint tenants with right
if
survivorship and not as
tenants
in common
|
||
|
Additional
abbreviations may also be used though not in the above
list.
|
||||
ASSIGNMENT
|
FOR
VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)
|
|
|
unto
|
|
(Please
print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a
Percentage Interest equal to _____% evidenced by the within Asset Backed
Pass-Through Certificate and hereby authorize(s) the registration of transfer
of
such interest to assignee on the Certificate Register of the Trust
Fund.
I
(we)
further direct the Securities Administrator to issue a new Certificate of a
like
Percentage Interest and Class to the above named assignee and deliver such
Certificate to the following address:
______________________________________________________________
___________________________________________________________________
.
|
Dated:
|
__________________________________ |
|
Signature
by or on behalf of assignor
|
|
| __________________________________ | |
|
Signature
Guaranteed
|
A-5-9
DISTRIBUTION
INSTRUCTIONS
The
assignee should include the following for purposes of distribution:
Distributions
shall be made, by wire transfer or otherwise, in immediately available
funds
to
_____________________________________________________________________________________________________
____________________________________________________________________________________________________________
for
the
account of
______________________________________________________________________________________________
account
number
________________________________________________________________________
or,
if
mailed by check, to
___________________________________________________________________________________________________________
Applicable
statements should be mailed to
___________________________________________________________________________
____________________________________________________________________________________________________________
This
information is provided by
______________________________________________________________________________
assignee
named above, or
________________________________________________________________________________________
its
agent.
X-0-00
XXXXXXX
X-0
FORM
OF
TRANSFEROR REPRESENTATION LETTER
[Date]
Xxxxx
Fargo Bank, N.A.
Xxxxx
Xxxxxx xxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx,
Xxxxxxxxx 00000
Attention:
Corporate Trust ACE 2007-WM2
|
Re:
|
ACE
Securities Corp. Home Equity Loan Trust, Series 2007-WM2
Asset
Backed Pass-Through Certificates
[Class
CE,] [Class P] and [Class R]
Certificates
|
Ladies
and Gentlemen:
In
connection with the transfer by ______________________ (the “Transferor”) to
___________________ (the “Transferee”) of the captioned asset backed
pass-through certificates (the “Certificates”), the Transferor hereby certifies
as follows:
Neither
the Transferor nor anyone acting on its behalf has (a) offered, pledged, sold,
disposed of or otherwise transferred any Certificate, any interest in any
Certificate or any other similar security to any person in any manner, (b)
has
solicited any offer to buy or to accept a pledge, disposition or other transfer
of any Certificate, any interest in any Certificate or any other similar
security from any person in any manner, (c) has otherwise approached or
negotiated with respect to any Certificate, any interest in any Certificate
or
any other similar security with any person in any manner, (d) has made any
general solicitation by means of general advertising or in any other manner,
(e)
has taken any other action, that (in the case of each of subclauses (a) through
(d) above) would constitute a distribution of the Certificates under the
Securities Act of 1933, as amended (the “1933 Act”), or would render the
disposition of any Certificate a violation of Section 5 of the 1933 Act or
any
state securities law or would require registration or qualification pursuant
thereto. The Transferor will not act, nor has it authorized or will it authorize
any person to act, in any manner set forth in the foregoing sentence with
respect to any Certificate. The Transferor will not sell or otherwise transfer
any of the Certificates, except in compliance with the provisions of that
certain Pooling and Servicing Agreement, dated as of March 1, 2007, among ACE
Securities Corp. as Depositor, Xxxxx Fargo Bank, N.A. as Master Servicer and
Securities Administrator, Ocwen Loan Servicing, LLC as Servicer and HSBC Bank
USA, National Association as Trustee (the “Pooling and Servicing Agreement”),
pursuant to which Pooling and Servicing Agreement the Certificates were
issued.
B-1-1
Capitalized
terms used but not defined herein shall have the meanings assigned thereto
in
the Pooling and Servicing Agreement.
|
Very
truly yours,
|
||||||||
|
[Transferor]
|
||||||||
|
By:
|
_______________________________ | |||||||
|
Name:
|
||||||||
|
Title:
|
||||||||
B-1-2
FORM
OF
TRANSFEREE REPRESENTATION LETTER
[Date]
Xxxxx
Fargo Bank, N.A.
Xxxxx
Xxxxxx xxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx,
Xxxxxxxxx 00000
Attention:
Corporate Trust ACE 2007-WM2
|
Re:
|
ACE
Securities Corp. Home Equity Loan Trust, Series 2007-WM2
Asset
Backed Pass-Through Certificates [Class CE Certificates]
[Class
P Certificates] [Class R Certificates]
|
Ladies
and Gentlemen:
In
connection with the purchase from ______________________________ (the
“Transferor”) on the date hereof of the captioned asset backed pass-through
certificates (the “Certificates”), (the “Transferee”) hereby certifies as
follows:
1. The
Transferee is a “qualified institutional buyer” as that term is defined in Rule
144A (“Rule 144A”) under the Securities Act of 1933 (the “1933 Act”) and has
completed either of the forms of certification to that effect attached hereto
as
Annex 1 or Annex 2. The Transferee is aware that the sale to it is being made
in
reliance on Rule 144A. The Transferee is acquiring the Certificates for its
own
account or for the account of a qualified institutional buyer, and understands
that such Certificate may be resold, pledged or transferred only (i) to a person
reasonably believed to be a qualified institutional buyer that purchases for
its
own account or for the account of a qualified institutional buyer to whom notice
is given that the resale, pledge or transfer is being made in reliance on Rule
144A, or (ii) pursuant to another exemption from registration under the 1933
Act.
2. The
Transferee has been furnished with all information regarding (a) the
Certificates and distributions thereon, (b) the nature, performance and
servicing of the Mortgage Loans, (c) the Pooling and Servicing Agreement
referred to below, and (d) any credit enhancement mechanism associated with
the
Certificates, that it has requested.
3. The
Transferee: (a) is not an employee benefit plan or other plan subject to the
prohibited transaction provisions of the Employee Retirement Income Security
Act
of 1974, as amended (“ERISA”), or Section 4975 of the Internal Revenue Code of
1986, as amended (the “Code”) (each, a “Plan”), or any other person (including
an investment manager, a named fiduciary or a trustee of any Plan) acting,
directly or indirectly, on behalf of or purchasing any Certificate with “plan
assets” of any Plan within the meaning of the Department of Labor (“DOL”)
regulation at 29 C.F.R. § 2510.3-101 or (b) has provided the Securities
Administrator with an Opinion of Counsel on which the Trustee, the Depositor,
the Master Servicer, the Securities Administrator and the Servicer may rely,
acceptable to and in form and substance satisfactory to the Securities
Administrator to the effect that the purchase of Certificates is permissible
under applicable law, will not constitute or result in any non-exempt prohibited
transaction under ERISA or Section 4975 of the Code and will not subject the
Trust Fund, the Trustee, the Depositor, the Master Servicer, the Securities
Administrator or the Servicer to any obligation or liability (including
obligations or liabilities under ERISA or Section 4975 of the Code) in addition
to those undertaken in the Pooling and Servicing Agreement.
B-1-3
In
addition, the Transferee hereby certifies, represents and warrants to, and
covenants with, the Depositor, the Trustee, the Securities Administrator, the
Master Servicer and the Servicer that the Transferee will not transfer such
Certificates to any Plan or person unless such Plan or person meets the
requirements set forth in paragraph 3 above.
All
capitalized terms used but not otherwise defined herein have the respective
meanings assigned thereto in the Pooling and Servicing Agreement, dated as
of
March 1, 2007, among ACE Securities Corp. as Depositor, Xxxxx Fargo Bank, N.A.
as Master Servicer and Securities Administrator, Ocwen Loan Servicing, LLC
as
Servicer and HSBC Bank USA, National Association as Trustee, pursuant to which
the Certificates were issued.
|
[TRANSFEREE]
|
||||||||
|
By:
|
_____________________________________ | |||||||
|
Name:
|
||||||||
|
Title:
|
||||||||
X-0-0
XXXXX
0 XX XXXXXXX X-0
QUALIFIED
INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For
Transferees Other Than Registered Investment Companies]
The
undersigned hereby certifies as follows to [name of Transferor] (the
“Transferor”) and Xxxxx Fargo Bank, N.A., as Securities Administrator, with
respect to the asset backed pass-through certificates (the “Certificates”)
described in the Transferee Certificate to which this certification relates
and
to which this certification is an Annex:
1. As
indicated below, the undersigned is the President, Chief Financial Officer,
Senior Vice President or other executive officer of the entity purchasing the
Certificates (the “Transferee”).
2. In
connection with purchases by the Transferee, the Transferee is a “qualified
institutional buyer” as that term is defined in Rule 144A under the Securities
Act of 1933 (“Rule 144A”) because (i) the Transferee owned and/or invested on a
discretionary basis $________________1
in
securities (except for the excluded securities referred to below) as of the
end
of the Transferee’s most recent fiscal year (such amount being calculated in
accordance with Rule 144A) and (ii) the Transferee satisfies the criteria in
the
category marked below.
|
___
|
Corporation,
etc.
The Transferee is a corporation (other than a bank, savings and loan
association or similar institution), Massachusetts or similar business
trust, partnership, or any organization described in Section 501(c)(3)
of
the Internal Revenue Code of 1986.
|
|
___
|
Bank.
The Transferee (a) is a national bank or banking institution organized
under the laws of any State, territory or the District of Columbia,
the
business of which is substantially confined to banking and is supervised
by the State or territorial banking commission or similar official
or is a
foreign bank or equivalent institution, and (b) has an audited net
worth
of at least $25,000,000 as demonstrated in its latest annual financial
statements, a
copy of which is attached hereto.
|
|
___
|
Savings
and Loan.
The Transferee (a) is a savings and loan association, building and
loan
association, cooperative bank, homestead association or similar
institution, which is supervised and examined by a State or Federal
authority having supervision over any such institutions or is a foreign
savings and loan association or equivalent institution and (b) has
an
audited net worth of at least $25,000,000 as demonstrated in its
latest
annual financial statements, a
copy of which is attached hereto.
|
___________________
| 1 |
Transferee
must own and/or invest on a discretionary basis at least $100,000,000
in
securities unless Transferee is a dealer, and, in that case, Transferee
must own and/or invest on a discretionary basis at least $10,000,000
in
securities.
|
B-1-5
|
___
|
Broker-dealer.
The Transferee is a dealer registered pursuant to Section 15 of the
Securities Exchange Act of 1934.
|
|
___
|
Insurance
Company.
The Transferee is an insurance company whose primary and predominant
business activity is the writing of insurance or the reinsuring of
risks
underwritten by insurance companies and which is subject to supervision
by
the insurance commissioner or a similar official or agency of a State,
territory or the District of Columbia.
|
|
___
|
State
or Local Plan.
The Transferee is a plan established and maintained by a State, its
political subdivisions, or any agency or instrumentality of the State
or
its political subdivisions, for the benefit of its
employees.
|
|
___
|
ERISA
Plan.
The Transferee is an employee benefit plan within the meaning of
Title I
of the Employee Retirement Income Security Act of 1974, as
amended.
|
|
___
|
Investment
Advisor
The Transferee is an investment advisor registered under the Investment
Advisers Act of 1940.
|
3. The
term
“securities”
as
used
herein does
not include
(i)
securities of issuers that are affiliated with the Transferee, (ii) securities
that are part of an unsold allotment to or subscription by the Transferee,
if
the Transferee is a dealer, (iii) securities issued or guaranteed by the U.S.
or
any instrumentality thereof, (iv) bank deposit notes and certificates of
deposit, (v) loan participations, (vi) repurchase agreements, (vii)
securities owned but subject to a repurchase agreement and (viii) currency,
interest rate and commodity swaps.
4. For
purposes of determining the aggregate amount of securities owned and/or invested
on a discretionary basis by the Transferee, the Transferee used the cost of
such
securities to the Transferee and did not include any of the securities referred
to in the preceding paragraph. Further, in determining such aggregate amount,
the Transferee may have included securities owned by subsidiaries of the
Transferee, but only if such subsidiaries are consolidated with the Transferee
in its financial statements prepared in accordance with generally accepted
accounting principles and if the investments of such subsidiaries are managed
under the Transferee’s direction. However, such securities were not included if
the Transferee is a majority-owned, consolidated subsidiary of another
enterprise and the Transferee is not itself a reporting company under the
Securities Exchange Act of 1934.
5. The
Transferee acknowledges that it is familiar with Rule 144A and understands
that
the Transferor and other parties related to the Certificates are relying and
will continue to rely on the statements made herein because one or more sales
to
the Transferee may be in reliance on Rule 144A.
|
___
|
___
|
Will
the Transferee be purchasing the Certificates
|
|
Yes
|
No
|
only
for the Transferee’s own account?
|
6. If
the
answer to the foregoing question is “no”, the Transferee agrees that, in
connection with any purchase of securities sold to the Transferee for the
account of a third party (including any separate account) in reliance on Rule
144A, the Transferee will only purchase for the account of a third party that
at
the time is a “qualified institutional buyer” within the meaning of Rule 144A.
In addition, the Transferee agrees that the Transferee will not purchase
securities for a third party unless the Transferee has obtained a current
representation letter from such third party or taken other appropriate steps
contemplated by Rule 144A to conclude that such third party independently meets
the definition of “qualified institutional buyer” set forth in Rule
144A.
B-1-6
7. The
Transferee will notify each of the parties to which this certification is made
of any changes in the information and conclusions herein. Until such notice
is
given, the Transferee’s purchase of the Certificates will constitute a
reaffirmation of this certification as of the date of such purchase. In
addition, if the Transferee is a bank or savings and loan as provided above,
the
Transferee agrees that it will furnish to such parties updated annual financial
statements promptly after they become available.
Dated:
|
___________________________________________
|
||||||||
|
Print
Name of Transferee
|
||||||||
|
By:
|
________________________________ | |||||||
|
Name:
|
||||||||
|
Title:
|
||||||||
X-0-0
XXXXX
0 XX XXXXXXX X-0
QUALIFIED
INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For
Transferees That Are Registered Investment Companies]
The
undersigned hereby certifies as follows to [name of Transferor] (the
“Transferor”) and Xxxxx Fargo Bank, N.A., as Securities Administrator, with
respect to the asset backed pass-through certificates (the “Certificates”)
described in the Transferee Certificate to which this certification relates
and
to which this certification is an Annex:
1. As
indicated below, the undersigned is the President, Chief Financial Officer
or
Senior Vice President of the entity purchasing the Certificates (the
“Transferee”) or, if the Transferee is a “qualified institutional buyer” as that
term is defined in Rule 144A under the Securities Act of 1933 (“Rule 144A”)
because the Transferee is part of a Family of Investment Companies (as defined
below), is such an officer of the investment adviser (the
“Adviser”).
2. In
connection with purchases by the Transferee, the Transferee is a “qualified
institutional buyer” as defined in Rule 144A because (i) the Transferee is an
investment company registered under the Investment Company Act of 1940, and
(ii)
as marked below, the Transferee alone, or the Transferee’s Family of Investment
Companies, owned at least $100,000,000 in securities (other than the excluded
securities referred to below) as of the end of the Transferee’s most recent
fiscal year. For purposes of determining the amount of securities owned by
the
Transferee or the Transferee’s Family of Investment Companies, the cost of such
securities was used.
|
___
|
The
Transferee owned $________________________ in securities (other than
the
excluded securities referred to below) as of the end of the Transferee’s
most recent fiscal year (such amount being calculated in accordance
with
Rule 144A).
|
|
___
|
The
Transferee is part of a Family of Investment Companies which owned
in the
aggregate $_______________ in securities (other than the excluded
securities referred to below) as of the end of the Transferee’s most
recent fiscal year (such amount being calculated in accordance with
Rule
144A).
|
3. The
term
“Family
of Investment Companies”
as
used
herein means two or more registered investment companies (or series thereof)
that have the same investment adviser or investment advisers that are affiliated
(by virtue of being majority owned subsidiaries of the same parent or because
one investment adviser is a majority owned subsidiary of the
other).
4. The
term
“securities”
as
used
herein does not include (i) securities of issuers that are affiliated with
the
Transferee or are part of the Transferee’s Family of Investment Companies, (ii)
securities issued or guaranteed by the U.S. or any instrumentality thereof,
(iii) bank deposit notes and certificates of deposit, (iv) loan participations,
(v) repurchase agreements, (vi) securities owned but subject to a
repurchase agreement and (vii) currency, interest rate and commodity
swaps.
B-1-8
5. The
Transferee is familiar with Rule 144A and understands that the parties to which
this certification is being made are relying and will continue to rely on the
statements made herein because one or more sales to the Transferee will be
in
reliance on Rule 144A. In addition, the Transferee will only purchase for the
Transferee’s own account.
6. The
undersigned will notify the parties to which this certification is made of
any
changes in the information and conclusions herein. Until such notice, the
Transferee’s purchase of the Certificates will constitute a reaffirmation of
this certification by the undersigned as of the date of such
purchase.
Dated:
|
___________________________________________
|
||||||||
|
Print
Name of Transferee or Advisor
|
||||||||
|
By:
|
________________________________ | |||||||
|
Name:
|
||||||||
|
Title:
|
||||||||
|
IF
AN ADVISER:
|
||||||||
|
___________________________________________
|
||||||||
|
Print
Name of Transferee
|
||||||||
B-1-9
FORM
OF
TRANSFEREE REPRESENTATION LETTER
The
undersigned hereby certifies on behalf of the purchaser named below (the
“Purchaser”) as follows:
1. I
am an
executive officer of the Purchaser.
2. The
Purchaser is a “qualified institutional buyer”, as defined in Rule 144A, (“Rule
144A”) under the Securities Act of 1933, as amended.
3. As
of the
date specified below (which is not earlier than the last day of the Purchaser’s
most recent fiscal year), the amount of “securities”, computed for purposes of
Rule 144A, owned and invested on a discretionary basis by the Purchaser was
in
excess of $100,000,000.
Name
of
Purchaser _____________________________________________________________________________________________
By:
(Signature)
________________________________________________________________________________________________
Name
of
Signatory
_____________________________________________________________________________________________
Title
________________________________________________________________________________________________________
Date
of
this certificate
___________________________________________________________________________________________
Date
of
information provided in paragraph 3
__________________________________________________________________________
X-0-00
XXXXXXX
X-0
FORM
OF
REGULATION S TRANSFER CERTIFICATE
[Date]
Xxxxx
Fargo Bank, N.A.
Xxxxx
Xxxxxx xxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx,
Xxxxxxxxx 00000
Attention:
Corporate Trust ACE 2007-WM2
|
Re:
|
ACE
Securities Corp. Home Equity Loan Trust, Series 2007-WM2
Asset
Backed Pass-Through Certificates, [Class CE Certificates][Class P
Certificates]
|
Ladies
and Gentlemen:
Reference
is hereby made to the Pooling and Servicing Agreement (the “Agreement”), dated
as of March 1, 2007, among ACE Securities Corp. (the “Depositor”), Xxxxx Fargo
Bank, N.A., as master servicer (the “Master Servicer”) and securities
administrator (the “Securities Administrator”), Ocwen Loan Servicing, LLC, as
servicer (the “Servicer”) and HSBC Bank USA, National Association, as trustee
(the “Trustee”). Capitalized terms used herein but not defined herein shall have
the meanings assigned thereto in the Agreement.
This
letter relates to U.S. $[__________] Certificate Principal Balance of Class
[CE][P] Certificates (the “Certificates”) which are held in the name of [name of
transferor] (the “Transferor”) to effect the transfer of the Certificates to a
person who wishes to take delivery thereof in the form of an equivalent
beneficial interest [name of transferee] (the “Transferee”).
In
connection with such request, the Transferor hereby certifies that such transfer
has been effected in accordance with the transfer restrictions set forth in
the
Agreement relating to the Certificates and that the following additional
requirements (if applicable) were satisfied:
(a) the
offer
of the Certificates was not made to a person in the United States;
(b) at
the
time the buy order was originated, the Transferee was outside the United States
or the Transferor and any person acting on its behalf reasonably believed that
the Transferee was outside the United States;
(c) no
directed selling efforts were made in contravention of the requirements of
Rule
903(b) or 904(b) of Regulation S, as applicable;
(d) the
transfer or exchange is not part of a plan or scheme to evade the registration
requirements of the Securities Act;
B-2-1
(e) the
Transferee is not a U.S. Person, as defined in Regulation S under the Securities
Act;
(f) the
transfer was made in accordance with the applicable provisions of Rule 903(b)(2)
or (3) or Rule 904(b)(1), as the case may be; and
(g) the
Transferee understands that the Certificates have not been and will not be
registered under the Securities Act, that any offers, sales or deliveries of
the
Certificates purchased by the Transferee in the United States or to U.S. persons
prior to the date that is 40 days after the later of (i) the commencement of
the
offering of the Certificates and (ii) the Closing Date, may constitute a
violation of United States law, and that (x) distributions of principal and
interest and (y) the exchange of beneficial interests in a Temporary Regulation
S Global Certificate for beneficial interests in the related Permanent
Regulation S Global Certificate, in each case, will be made in respect of such
Certificates only following the delivery by the Holder of a certification of
non-U.S. beneficial ownership, at the times and in the manner set forth in
the
Agreement.
B-2-2
You
are
entitled to rely upon this letter and are irrevocably authorized to produce
this
letter or a copy hereof to any interested party in any administrative or legal
proceedings or official inquiry with respect to the matters covered
hereby.
|
[Name
of Transferor]
|
||||||||
|
By:
|
________________________________ | |||||||
|
Name:
|
||||||||
|
Title:
|
||||||||
X-0-0
XXXXXXX
X-0
FORM
OF
TRANSFEROR REPRESENTATION LETTER
____________,
20__
Xxxxx
Fargo Bank, N.A.
Xxxxx
Xxxxxx xxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx,
Xxxxxxxxx 00000
Attention:
Corporate Trust ACE 2007-WM2
|
Re:
|
ACE
Securities Corp. Home Equity Loan Trust, Series 2007-WM2
Asset
Backed Pass-Through Certificates, [Class CE Certificates] [Class
P
Certificates] [Class R Certificates]
|
Ladies
and Gentlemen:
In
connection with the transfer by ________________ (the “Transferor”) to
__________________________ (the “Transferee”) of the captioned asset backed
pass-through certificates (the “Certificates”), the Transferor hereby certifies
as follows:
Neither
the Seller nor anyone acting on its behalf has (a) offered, pledged, sold,
disposed of or otherwise transferred any Certificate, any interest in any
Certificate or any other similar security to any person in any manner, (b)
has
solicited any offer to buy or to accept a pledge, disposition or other transfer
of any Certificate, any interest in any Certificate or any other similar
security from any person in any manner, (c) has otherwise approached or
negotiated with respect to any Certificate, any interest in any Certificate
or
any other similar security with any person in any manner, (d) has made any
general solicitation by means of general advertising or in any other manner,
or
(e) has taken any other action, that (as to any of (a) through (d) above) would
constitute a distribution of the Certificates under the Securities Act of 1933
(the “Act’), that would render the disposition of any Certificate a violation of
Section 5 of the Act or any state securities law, or that would require
registration or qualification pursuant thereto. The Seller will not act, in
any
manner set forth in the foregoing sentence with respect to any Certificate.
The
Seller has not and will not sell or otherwise transfer any of the Certificates,
except in compliance with the provisions of the Pooling and Servicing Agreement,
dated as of March 1, 2007, among ACE Securities Corp., Xxxxx Fargo Bank, N.A.,
Ocwen Loan Servicing, LLC, and HSBC Bank USA, National Association, pursuant
to
which the Certificates were issued.
|
Very
truly yours,
|
||||||||
|
___________________________________________
|
||||||||
|
(Transferor)
|
||||||||
|
By:
|
________________________________ | |||||||
|
Name:
|
||||||||
|
Title:
|
||||||||
B-3-1
FORM
OF
TRANSFEREE LETTER
_______________,
20__
Xxxxx
Fargo Bank, N.A.
Xxxxx
Xxxxxx xxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx,
Xxxxxxxxx 00000
Attention:
Corporate Trust ACE 2007-WM2
|
Re:
|
ACE
Securities Corp. Home Equity Loan Trust, Series 2007-WM2
Asset
Backed Pass-Through Certificates, [Class CE Certificates] [Class
P
Certificates] [Class R Certificates]
|
Ladies
and Gentlemen:
In
connection with the transfer by ______________________ (the “Transferor”) to
__________________________ (the “Transferee”) of the captioned asset backed
pass-through certificates (the “Certificates”), the Transferee hereby certifies
as follows:
1. The
Transferee understands that (a) the Certificates have not been and will not
be
registered or qualified under the Securities Act of 1933, as amended (the “Act”)
or any state securities law, (b) ACE Securities Corp. (the “Depositor”) is not
required to so register or qualify the Certificates, (c) the Certificates may
be
resold only if registered and qualified pursuant to the provisions of the Act
or
any state securities law, or if an exemption from such registration and
qualification is available, (d) the Pooling and Servicing Agreement, dated
as of
March 1, 2007, among the Depositor, as depositor, Xxxxx Fargo Bank, N.A., as
master servicer (the “Master Servicer”) and securities administrator (the
“Securities Administrator”), Ocwen Loan Servicing, LLC, as servicer (the
“Servicer”) and HSBC Bank USA, National Association, as trustee (the “Trustee”)
contains restrictions regarding the transfer of the Certificates and (e) the
Certificates will bear a legend to the foregoing effect.
2. The
Transferee is acquiring the Certificates for its own account for investment
only
and not with a view to or for sale in connection with any distribution thereof
in any manner that would violate the Act or any applicable state securities
laws.
3. The
Transferee is (a) a substantial, sophisticated institutional investor having
such knowledge and experience in financial and business matters, and, in
particular, in such matters related to securities similar to the Certificates,
such that it is capable of evaluating the merits and risks of investment in
the
Certificates, (b) able to bear the economic risks of such an investment and
(c)
an “accredited investor” within the meaning of Rule 501(a) promulgated pursuant
to the Act.
4. The
Transferee has been furnished with, and has had an opportunity to review (a)
a
copy of the Pooling and Servicing Agreement and (b) such other information
concerning the Certificates, the Mortgage Loans and the Depositor as has been
requested by the Transferee from the Depositor or the Transferor and is relevant
to the Transferee’s decision to purchase the Certificates. The Transferee has
had any questions arising from such review answered by the Depositor or the
Transferor to the satisfaction of the Transferee.
B-3-2
5. The
Transferee has not and will not nor has it authorized or will it authorize
any
person to (a) offer, pledge, sell, dispose of or otherwise transfer any
Certificate, any interest in any Certificate or any other similar security
to
any person in any manner, (b) solicit any offer to buy or to accept a pledge,
disposition of other transfer of any Certificate, any interest in any
Certificate or any other similar security from any person in any manner, (c)
otherwise approach or negotiate with respect to any Certificate, any interest
in
any Certificate or any other similar security with any person in any manner,
(d)
make any general solicitation by means of general advertising or in any other
manner or (e) take any other action, that (as to any of (a) through (d) above)
would constitute a distribution of any Certificate under the Act, that would
render the disposition of any Certificate a violation of Section 5 of the 1933
Act or any state securities law, or that would require registration or
qualification pursuant thereto. The Transferee will not sell or otherwise
transfer any of the Certificates, except in compliance with the provisions
of
the Pooling and Servicing Agreement.
6. The
Transferee: (a) is not an employee benefit plan or other plan subject to the
prohibited transaction provisions of the Employee Retirement Income Security
Act
of 1974, as amended (“ERISA”), or Section 4975 of the Internal Revenue Code of
1986, as amended (the “Code”) (each, a “Plan”), or any other person (including
an investment manager, a named fiduciary or a trustee of any Plan) acting,
directly or indirectly, on behalf of or purchasing any Certificate with “plan
assets” of any Plan within the meaning of the Department of Labor (“DOL”)
regulation at 29 C.F.R. § 2510.3-101 or (b) has provided the Securities
Administrator with an Opinion of Counsel on which the Depositor, the Master
Servicer, the Securities Administrator, the Trustee and the Servicer may rely,
acceptable to and in form and substance satisfactory to the Securities
Administrator to the effect that the purchase of Certificates is permissible
under applicable law, will not constitute or result in any non-exempt prohibited
transaction under ERISA or Section 4975 of the Code and will not subject the
Trust Fund, the Trustee, the Master Servicer, the Securities Administrator,
the
Depositor or the Servicer to any obligation or liability (including obligations
or liabilities under ERISA or Section 4975 of the Code) in addition to those
undertaken in the Pooling and Servicing Agreement.
In
addition, the Transferee hereby certifies, represents and warrants to, and
covenants with, the Depositor, the Trustee, the Securities Administrator, the
Master Servicer and the Servicer that the Transferee will not transfer such
Certificates to any Plan or person unless such Plan or person meets the
requirements set forth in paragraph 6 above.
|
Very
truly yours,
|
||||||||
|
By:
|
____________________________ | |||||||
|
Name:
|
||||||||
|
Title:
|
||||||||
X-0-0
XXXXXXX
X-0
TRANSFER
AFFIDAVIT AND AGREEMENT
|
STATE
OF NEW YORK
|
)
|
|
|
)
|
ss.:
|
|
|
COUNTY
OF NEW YORK
|
)
|
___________________________
being duly sworn, deposes, represents and warrants as follows:
|
1.
|
I
am a _____________________ of _______________________________ (the
“Owner”) a corporation duly organized and existing under the laws of
_________________________, the record owner of ACE Securities Corp.
Home
Equity Loan Trust, Series 2007-WM2 Asset Backed Pass-Through Certificates,
Class R Certificates (the “Class R Certificates”), on behalf of whom I
make this affidavit and agreement. Capitalized terms used but not
defined
herein have the respective meanings assigned thereto in the Pooling
and
Servicing Agreement, dated as of March 1, 2007, among ACE Securities
Corp., Xxxxx Fargo Bank, N.A., Ocwen Loan Servicing, LLC, and HSBC
Bank
USA, National Association, pursuant to which the Class R Certificates
were
issued.
|
|
2.
|
The
Owner (i) is and will be a “Permitted Transferee” as of
________________________ and (ii) is acquiring the Class R Certificates
for its own account or for the account of another Owner from which
it has
received an affidavit in substantially the same form as this affidavit.
A
“Permitted Transferee” is any person other than a “disqualified
organization” or a possession of the United States. For this purpose, a
“disqualified organization” means the United States, any state or
political subdivision thereof, any agency or instrumentality of any
of the
foregoing (other than an instrumentality all of the activities of
which
are subject to tax and, except for the Federal Home Loan Mortgage
Corporation, a majority of whose board of directors is not selected
by any
such governmental entity) or any foreign government, international
organization or any agency or instrumentality of such foreign government
or organization, any real electric or telephone cooperative, or any
organization (other than certain farmers’ cooperatives) that is generally
exempt from federal income tax unless such organization is subject
to the
tax on unrelated business taxable
income.
|
|
3.
|
The
Owner is aware (i) of the tax that would be imposed on transfers
of the
Class R Certificates to disqualified organizations under the Internal
Revenue Code of 1986 that applies to all transfers of the Class R
Certificates after April 31, 1988; (ii) that such tax would be on
the
transferor or, if such transfer is through an agent (which person
includes
a broker, nominee or middleman) for a non-Permitted Transferee, on
the
agent; (iii) that the person otherwise liable for the tax shall be
relieved of liability for the tax if the transferee furnishes to
such
person an affidavit that the transferee is a Permitted Transferee
and, at
the time of transfer, such person does not have actual knowledge
that the
affidavit is false; and (iv) that each of the Class R Certificates
may be
a “noneconomic residual interest” within the meaning of proposed Treasury
regulations promulgated under the Code and that the transferor of
a
“noneconomic residual interest” will remain liable for any taxes due with
respect to the income on such residual interest, unless no significant
purpose of the transfer is to impede the assessment or collection
of
tax.
|
B-4-1
|
4.
|
The
Owner is aware of the tax imposed on a “pass-through entity” holding the
Class R Certificates if, at any time during the taxable year of the
pass-through entity, a non-Permitted Transferee is the record holder
of an
interest in such entity. (For this purpose, a “pass-through entity”
includes a regulated investment company, a real estate investment
trust or
common trust fund, a partnership, trust or estate, and certain
cooperatives.)
|
|
5.
|
The
Owner is aware that the Securities Administrator will not register
the
transfer of any Class R Certificate unless the transferee, or the
transferee’s agent, delivers to the Securities Administrator, among other
things, an affidavit in substantially the same form as this affidavit.
The
Owner expressly agrees that it will not consummate any such transfer
if it
knows or believes that any of the representations contained in such
affidavit and agreement are false.
|
|
6.
|
The
Owner consents to any additional restrictions or arrangements that
shall
be deemed necessary upon advice of counsel to constitute a reasonable
arrangement to ensure that the Class R Certificates will only be
owned,
directly or indirectly, by an Owner that is a Permitted
Transferee.
|
|
7.
|
The
Owner’s taxpayer identification number is
________________.
|
|
8.
|
The
Owner has reviewed the restrictions set forth on the face of the
Class R
Certificates and the provisions of Section 6.02(d) of the Pooling
and
Servicing Agreement under which the Class R Certificates were issued
(in
particular, clauses (iii)(A) and (iii)(B) of Section 6.02(d) which
authorize the Securities Administrator to deliver payments to a person
other than the Owner and negotiate a mandatory sale by the Securities
Administrator in the event that the Owner holds such Certificate
in
violation of Section 6.02(d)); and that the Owner expressly agrees
to be
bound by and to comply with such restrictions and
provisions.
|
|
9.
|
The
Owner is not acquiring and will not transfer the Class R Certificates
in
order to impede the assessment or collection of any
tax.
|
|
10.
|
The
Owner anticipates that it will, so long as it holds the Class R
Certificates, have sufficient assets to pay any taxes owed by the
holder
of such Class R Certificates, and hereby represents to and for the
benefit
of the person from whom it acquired the Class R Certificates that
the
Owner intends to pay taxes associated with holding such Class R
Certificates as they become due, fully understanding that it may
incur tax
liabilities in excess of any cash flows generated by the Class R
Certificates.
|
B-4-2
|
11.
|
The
Owner has no present knowledge that it may become insolvent or subject
to
a bankruptcy proceeding for so long as it holds the Class R
Certificates.
|
|
12.
|
The
Owner has no present knowledge or expectation that it will be unable
to
pay any United States taxes owed by it so long as any of the Certificates
remain outstanding.
|
|
13.
|
The
Owner is not acquiring the Class R Certificates with the intent to
transfer the Class R Certificates to any person or entity that will
not
have sufficient assets to pay any taxes owed by the holder of such
Class R
Certificates, or that may become insolvent or subject to a bankruptcy
proceeding, for so long as the Class R Certificates remain
outstanding.
|
|
14.
|
The
Owner will, in connection with any transfer that it makes of the
Class R
Certificates, obtain from its transferee the representations required
by
Section 6.02(d) of the Pooling and Servicing Agreement under which
the
Class R Certificate were issued and will not consummate any such
transfer
if it knows, or knows facts that should lead it to believe, that
any such
representations are false.
|
|
15.
|
The
Owner will, in connection with any transfer that it makes of the
Class R
Certificates, deliver to the Securities Administrator an affidavit,
which
represents and warrants that it is not transferring the Class R
Certificates to impede the assessment or collection of any tax and
that it
has no actual knowledge that the proposed transferee: (i) has insufficient
assets to pay any taxes owed by such transferee as holder of the
Class R
Certificates; (ii) may become insolvent or subject to a bankruptcy
proceeding for so long as the Class R Certificates remains outstanding;
and (iii) is not a “Permitted
Transferee”.
|
|
16.
|
The
Owner is a citizen or resident of the United States, a corporation,
partnership or other entity created or organized in, or under the
laws of,
the United States or any political subdivision thereof, or an estate
or
trust whose income from sources without the United States may be
included
in gross income for United States federal income tax purposes regardless
of its connection with the conduct of a trade or business within
the
United States.
|
|
17.
|
The
Owner of the Class R Certificate, hereby agrees that in the event
that the
Trust Fund created by the Pooling and Servicing Agreement is terminated
pursuant to Section 10.01 thereof, the undersigned shall assign and
transfer to the Holders of the Class CE Certificates any amounts
in excess
of par received in connection with such termination. Accordingly,
in the
event of such termination, the Securities Administrator is hereby
authorized to withhold any such amounts in excess of par and to pay
such
amounts directly to the Holders of the Class CE Certificates. This
agreement shall bind and be enforceable against any successor, transferee
or assigned of the undersigned in the Class R Certificate. In connection
with any transfer of the Class R Certificate, the Owner shall obtain
an
agreement substantially similar to this clause from any subsequent
owner.
|
B-4-3
IN
WITNESS WHEREOF, the Owner has caused this instrument to be executed on its
behalf, pursuant to the authority of its Board of Directors, by its [Vice]
President, attested by its [Assistant] Secretary, this ____ day of
_________________, ____.
|
[OWNER]
|
||||||||
|
By:
|
_____________________________ | |||||||
|
Name:
|
||||||||
|
Title:
[Vice] President
|
||||||||
ATTEST:
|
By:
|
________________________________ |
|
Name:
|
|
|
Title:
[Assistant] Secretary
|
Personally
appeared before me the above-named __________________, known or proved to me
to
be the same person who executed the foregoing instrument and to be a [Vice]
President of the Owner, and acknowledged to me that [he/she] executed the same
as [his/her] free act and deed and the free act and deed of the
Owner.
Subscribed
and sworn before me this ______________ day of __________, ____.
| ________________________________ | |
|
Notary
Public
|
|
|
County
of _____________________________
|
|
|
State
of _______________________________
|
|
|
My
Commission expires:
|
B-4-4
FORM
OF
TRANSFEROR AFFIDAVIT
|
STATE
OF NEW YORK
|
)
|
|
|
)
|
ss.:
|
|
|
COUNTY
OF NEW YORK
|
)
|
_________________________,
being duly sworn, deposes, represents and warrants as follows:
1. I
am
a ____________________
of _________________________ (the “Owner”), a corporation duly organized and
existing under the laws of _____________, on behalf of whom I make this
affidavit.
2. The
Owner
is not transferring the Class R Certificates (the “Residual Certificates”) to
impede the assessment or collection of any tax.
3. The
Owner
has no actual knowledge that the Person that is the proposed transferee (the
“Purchaser”) of the Residual Certificates: (i) has insufficient assets to pay
any taxes owed by such proposed transferee as holder of the Residual
Certificates; (ii) may become insolvent or subject to a bankruptcy proceeding
for so long as the Residual Certificates remain outstanding and (iii) is not
a
Permitted Transferee.
4. The
Owner
understands that the Purchaser has delivered to the Securities Administrator
or
a transfer affidavit and agreement in the form attached to the Pooling and
Servicing Agreement as Exhibit B-2. The Owner does not know or believe that
any
representation contained therein is false.
5. At
the
time of transfer, the Owner has conducted a reasonable investigation of the
financial condition of the Purchaser as contemplated by Treasury Regulations
Section 1.860E-1(c)(4)(i) and, as a result of that investigation, the Owner
has
determined that the Purchaser has historically paid its debts as they became
due
and has found no significant evidence to indicate that the Purchaser will not
continue to pay its debts as they become due in the future. The Owner
understands that the transfer of a Residual Certificate may not be respected
for
United States income tax purposes (and the Owner may continue to be liable
for
United States income taxes associated therewith) unless the Owner has conducted
such an investigation.
6. Capitalized
terms not otherwise defined herein shall have the meanings ascribed to them
in
the Pooling and Servicing Agreement, dated as of March 1, 2007, among ACE
Securities Corp., Xxxxx Fargo Bank, N.A., Ocwen Loan Servicing, LLC, and HSBC
Bank USA, National Association.
B-4-5
IN
WITNESS WHEREOF, the Owner has caused this instrument to be executed on its
behalf, pursuant to the authority of its Board of Directors, by its [Vice]
President, attested by its [Assistant] Secretary, this ____ day of
________________, ____.
|
[OWNER]
|
||||||||
|
By:
|
________________________________ | |||||||
|
Name:
|
||||||||
|
Title:
[Vice] President
|
||||||||
ATTEST:
|
By:
|
______________________________________ |
|
Name:
|
|
|
Title:
[Assistant] Secretary
|
Personally
appeared before me the above-named _________________, known or proved to me
to
be the same person who executed the foregoing instrument and to be a [Vice]
President of the Owner, and acknowledged to me that [he/she] executed the same
as [his/her] free act and deed and the free act and deed of the
Owner.
Subscribed
and sworn before me this ______ day of _____________, ____.
| ________________________________ | |
|
Notary
Public
|
|
|
County
of _________________________
|
|
|
State
of _______________________________
|
|
|
My
Commission expires:
|
B-4-6
EXHIBIT
C
BACK-UP
CERTIFICATION
Re: __________
(the “Trust”)
Mortgage
Pass-Through Certificates, Series 2007-WM2
I,
[identify the certifying individual], certify to ACE Securities Corp. (the
“Depositor”), HSBC Bank USA, National Association (the “Trustee”) and Xxxxx
Fargo Bank, National Association (the “Master Servicer”) and their respective
officers, directors and affiliates, and with the knowledge and intent that
they
will rely upon this certification, that:
(1) I
have
reviewed the servicer compliance statement of the Servicer provided in
accordance with Item 1123 of Regulation AB (the “Compliance Statement”), the
report on assessment of the Servicer’s compliance with the servicing criteria
set forth in Item 1122(d) of Regulation AB (the “Servicing Criteria”), provided
in accordance with Rules 13a-18 and 15d-18 under Securities Exchange Act of
1934, as amended (the “Exchange Act”) and Item 1122 of Regulation AB (the
“Servicing Assessment”), the registered public accounting firm’s attestation
report provided in accordance with Rules 13a-18 and 15d-18 under the Exchange
Act and Section 1122(b) of Regulation AB (the “Attestation
Report”), and all servicing reports, officer’s certificates and other
information relating to the servicing of the Mortgage Loans by the Servicer
during 200[ ] that were delivered by the Servicer to the Master Servicer
pursuant to the Agreement (collectively, the “Servicer Servicing
Information”);
(2) Based
on
my knowledge, the Servicer Servicing Information, taken as a whole, does not
contain any untrue statement of a material fact or omit to state a material
fact
necessary to make the statements made, in the light of the circumstances under
which such statements were made, not misleading with respect to the period
of
time covered by the Servicer Servicing Information;
(3) Based
on
my knowledge, all of the Servicer Servicing Information required to be provided
by the Servicer under the Agreement has been provided to the Master
Servicer;
(4) I
am
responsible for reviewing the activities performed by the Servicer as servicer
under the Agreement, and based on my knowledge and the compliance review
conducted in preparing the Compliance Statement and except as disclosed in
the
Compliance Statement, the Servicing Assessment or the Attestation Report, the
Servicer has fulfilled its obligations under the Agreement in all material
respects; and
(5) The
Compliance Statement required to be delivered by the Servicer pursuant to the
Agreement, and the Servicing Assessment and Attestation Report required to
be
provided by the Servicer and by any Sub-Servicer and Subcontractor pursuant
to
the Agreement, have been provided to the Master Servicer. Any material instances
of noncompliance described in such reports have been disclosed to the Master
Servicer. Any material instance of noncompliance with the Servicing Criteria
has
been disclosed in such reports.
C-1
Capitalized
terms used and not otherwise defined herein have the meanings assigned thereto
in the Pooling and Servicing Agreement (the “Agreement”), dated as of March 1,
2007, among ACE Securities Corp. as Depositor, Xxxxx Fargo Bank, N.A. as Master
Servicer and Securities Administrator, Ocwen Loan Servicing, LLC as Servicer
and
HSBC Bank USA, National Association as Trustee.
|
Date:
__________________________________________
|
|
| _________________________________________ | |
|
[Signature]
|
|
| _________________________________________ | |
|
[Title]
|
C-2
EXHIBIT
D
FORM
OF
POWER OF ATTORNEY
RECORDING
REQUESTED BY
AND
WHEN
RECORDED MAIL TO
Ocwen
Loan Servicing, LLC
0000
Xxxxxxxxxxx Xxxx, Xxxxxxxxxx Xxxx, Xxxxx 000
Xxxx
Xxxx Xxxxx, Xxxxxxx 00000
Attn:
_________________________________
LIMITED
POWER OF ATTORNEY
KNOW
ALL
MEN BY THESE PRESENTS, that HSBC Bank USA, National Association having its
principal place of business at ____________________, as Trustee (the “Trustee”)
pursuant to that Pooling and Servicing Agreement among ACE Securities Corp.
(the
“Depositor”), Xxxxx Fargo Bank, N.A., as Master Servicer and Securities
Administrator, Ocwen Loan Servicing, LLC, as Servicer (the “Servicer”), and the
Trustee, dated as of March 1, 2007 (the “Pooling and Servicing Agreement”),
hereby constitutes and appoints the Servicer, by and through the Servicer’s
officers, the Trustee’s true and lawful Attorney-in-Fact, in the Trustee’s name,
place and stead and for the Trustee’s benefit, in connection with all mortgage
loans serviced by the Servicer pursuant to the Pooling and Servicing Agreement
for the purpose of performing all acts and executing all documents in the name
of the Trustee as may be customarily and reasonably necessary and appropriate
to
effectuate the following enumerated transactions in respect of any of the
mortgages or deeds of trust (the “Mortgages” and the “Deeds of Trust”,
respectively) and promissory notes secured thereby (the “Mortgage Notes”) for
which the undersigned is acting as Trustee for various certificateholders
(whether the undersigned is named therein as mortgagee or beneficiary or has
become mortgagee by virtue of endorsement of the Mortgage Note secured by any
such Mortgage or Deed of Trust) and for which the Servicer is acting as
servicer, all subject to the terms of the Pooling and Servicing
Agreement.
This
appointment shall apply to the following enumerated transactions
only:
|
1.
|
The
modification or re-recording of a Mortgage or Deed of Trust, where
said
modification or re-recordings is for the purpose of correcting the
Mortgage or Deed of Trust to conform same to the original intent
of the
parties thereto or to correct title errors discovered after such
title
insurance was issued and said modification or re-recording, in either
instance, does not adversely affect the lien of the Mortgage or Deed
of
Trust as insured.
|
|
2.
|
The
subordination of the lien of a Mortgage or Deed of Trust to an easement
in
favor of a public utility company of a government agency or unit
with
powers of eminent domain; this section shall include, without limitation,
the execution of partial satisfactions/releases, partial reconveyances
or
the execution or requests to trustees to accomplish
same.
|
D-1
|
3.
|
The
conveyance of the properties to the mortgage insurer, or the closing
of
the title to the property to be acquired as real estate owned, or
conveyance of title to real estate
owned.
|
| 4. |
The
completion of loan assumption
agreements.
|
|
5.
|
The
full satisfaction/release of a Mortgage or Deed of Trust or full
conveyance upon payment and discharge of all sums secured thereby,
including, without limitation, cancellation of the related Mortgage
Note.
|
|
6.
|
The
assignment of any Mortgage or Deed of Trust and the related Mortgage
Note,
in connection with the repurchase of the mortgage loan secured and
evidenced thereby.
|
|
7.
|
The
full assignment of a Mortgage or Deed of Trust upon payment and discharge
of all sums secured thereby in conjunction with the refinancing thereof,
including, without limitation, the assignment of the related Mortgage
Note.
|
|
8.
|
With
respect to a Mortgage or Deed of Trust, the foreclosure, the taking
of a
deed in lieu of foreclosure, or the completion of judicial or non-judicial
foreclosure or termination, cancellation or rescission of any such
foreclosure, including, without limitation, any and all of the following
acts:
|
|
a.
|
the
substitution of trustee(s) serving under a Deed of Trust, in accordance
with state law and the Deed of
Trust;
|
|
b.
|
the
preparation and issuance of statements of breach or
non-performance;
|
|
c.
|
the
preparation and filing of notices of default and/or notices of
sale;
|
|
d.
|
the
cancellation/rescission of notices of default and/or notices of
sale;
|
|
e.
|
the
taking of a deed in lieu of foreclosure;
and
|
|
f.
|
the
preparation and execution of such other documents and performance
of such
other actions as may be necessary under the terms of the Mortgage,
Deed of
Trust or state law to expeditiously complete said transactions in
paragraphs 8.a. through 8.e.,
above.
|
The
undersigned gives said Attorney-in-Fact full power and authority to execute
such
instruments and to do and perform all and every act and thing necessary and
proper to carry into effect the power or powers granted by or under this Limited
Power of Attorney as fully as the undersigned might or could do, and hereby
does
ratify and confirm to all that said Attorney-in-Fact shall lawfully do or cause
to be done by authority hereof.
D-2
Third
parties without actual notice may rely upon the exercise of the power granted
under this Limited Power of Attorney; and may be satisfied that this Limited
Power of Attorney shall continue in full force and effect and has not been
revoked unless an instrument of revocation has been made in writing by the
undersigned.
IN
WITNESS WHEREOF, HSBC Bank USA, National Association as Trustee for ACE
Securities Corp. Home Equity Loan Trust, Series 2007-WM2 Asset Backed
Pass-Through Certificates, Series 2007-WM2 pursuant to that Pooling and
Servicing Agreement, has caused its corporate seal to be hereto affixed and
these presents to be signed and acknowledged in its name and behalf by
____________ its duly elected and authorized Vice President this _________
day
of _________, 200__.
|
______________________________________
as
Trustee for ACE Securities Corp. Home Equity
Loan
Trust, Series 2007-WM2 Asset Backed
Pass-Through
Certificates, Series 2007-WM2
|
||||||||
|
By:
|
_________________________________ | |||||||
| _________________________________ |
|
STATE
OF _____________
|
|
COUNTY
OF ___________
|
On
_______________, 200__, before me, the undersigned, a Notary Public in and
for
said state, personally appeared ____________, Vice President of HSBC Bank USA,
National Association as Trustee for ACE Securities Corp. Home Equity Loan Trust,
Series 2007-WM2 Asset Backed Pass-Through Certificates, Series 2007-WM2,
personally known to me to be the person whose name is subscribed to the within
instrument and acknowledged to me that he/she executed that same in his/her
authorized capacity, and that by his/her signature on the instrument the entity
upon behalf of which the person acted and executed the instrument.
WITNESS
my hand and official seal.
(SEAL)
|
|
|
|
Notary
Public
|
|
|
My
Commission Expires
_________________________________
|
D-3
EXHIBIT
E
SERVICING
CRITERIA
Schedule
1122 (Pooling and Servicing Agreement)
Assessments
of Compliance and Attestation Reports Servicing Criteria2
|
Reg.
AB Item 1122(d) Servicing Criteria
|
Depositor
|
Seller
|
Servicer
|
Trustee
|
Custodian
|
Paying
Agent
|
Master
Servicer
|
Securities
Administrator
|
|
(1) General
Servicing Considerations
|
||||||||
|
(i)
monitoring
performance or other triggers and events of default
|
X
|
X
|
X
|
|||||
|
(ii)
monitoring
performance of vendors of activities outsourced
|
X
|
X
|
||||||
|
(iii)
maintenance
of back-up servicer for pool assets
|
||||||||
|
(iv) fidelity
bond and E&O policies in effect
|
X
|
X
|
||||||
|
(2) Cash
Collection and Administration
|
||||||||
|
(i)
timing
of deposits to custodial account
|
X
|
X
|
X
|
X
|
||||
|
(ii)
wire
transfers to investors by authorized personnel
|
X
|
X
|
X
|
|||||
|
(iii)
advances
or guarantees made, reviewed and approved as required
|
X
|
X
|
________________
| *(2) |
The
descriptions of the Item 1122(d) servicing criteria use key words
and
phrases and are not verbatim recitations of the servicing criteria.
Refer
to Regulation AB, Item 1122 for a full description of servicing
criteria.
|
E-1
|
Reg.
AB Item 1122(d) Servicing Criteria
|
Depositor
|
Seller
|
Servicer
|
Trustee
|
Custodian
|
Paying
Agent
|
Master
Servicer
|
Securities
Administrator
|
|
(iv) accounts
maintained as required
|
X
|
X
|
X
|
X
|
||||
|
(v)
accounts
at federally insured depository institutions
|
X
|
X
|
X
|
X
|
||||
|
(vi) unissued
checks safeguarded
|
X
|
X
|
X
|
|||||
|
(vii) monthly
reconciliations of accounts
|
X
|
X
|
X
|
X
|
||||
|
(3) Investor
Remittances and Reporting
|
||||||||
|
(i)
investor
reports
|
X
|
X
|
X
|
|||||
|
(ii)
remittances
|
X
|
X
|
X
|
|||||
|
(iii) proper
posting of distributions
|
X
|
X
|
X
|
|||||
|
(iv) reconciliation
of remittances and payment statements
|
X
|
X
|
X
|
X
|
||||
|
(4) Pool
Asset Administration
|
||||||||
|
(i)
maintenance
of pool collateral
|
X
|
X
|
||||||
|
(ii)
safeguarding
of pool assets/documents
|
X
|
X
|
||||||
|
(iii)
additions,
removals and substitutions of pool assets
|
X
|
X
|
||||||
|
(iv) posting
and allocation of pool asset payments to pool assets
|
X
|
|||||||
|
(v)
reconciliation
of servicer records
|
X
|
|||||||
|
(vi) modifications
or other changes to terms of pool assets
|
X
|
E-2
|
Reg.
AB Item 1122(d) Servicing Criteria
|
Depositor
|
Seller
|
Servicer
|
Trustee
|
Custodian
|
Paying
Agent
|
Master
Servicer
|
Securities
Administrator
|
|
(vii) loss
mitigation and recovery actions
|
X
|
|||||||
|
(viii)
records regarding collection efforts
|
X
|
|||||||
|
(ix)
adjustments
to variable interest rates on pool assets
|
X
|
|||||||
|
(x)
matters
relating to funds held in trust for obligors
|
X
|
|||||||
|
(xi)
payments
made on behalf of obligors (such as for taxes or
insurance)
|
X
|
|||||||
|
(xii)
late
payment penalties with respect to payments made on behalf of obligors
|
X
|
|||||||
|
(xiii) records
with respect to payments made on behalf of obligors
|
X
|
|||||||
|
(xiv) recognition
and recording of delinquencies, charge-offs and uncollectible
accounts
|
X
|
X
|
||||||
|
(xv) maintenance
of external credit enhancement or other support
|
X
|
E-3
EXHIBIT
F
MORTGAGE
LOAN PURCHASE AGREEMENT
F-1
MORTGAGE
LOAN PURCHASE AGREEMENT
This
is a
Mortgage Loan Purchase Agreement (this “Agreement”), dated March 30, 2007,
between DB Structured Products, Inc., a Delaware corporation (the “Seller”) and
ACE Securities Corp., a Delaware corporation (the “Purchaser”).
Preliminary
Statement
The
Seller intends to sell the Mortgage Loans (as hereinafter identified) and
the
Cap Agreements (as defined herein) to the Purchaser on the terms and subject
to
the conditions set forth in this Agreement. The Purchaser intends to deposit
the
Mortgage Loans into a mortgage pool comprising the Trust Fund. The Trust
Fund
will be evidenced by a single series of mortgage pass-through certificates
designated as ACE Securities Corp. Home Equity Loan Trust, Series 2007-WM2,
Asset Backed Pass-Through Certificates (the “Certificates”). The Certificates
will consist of seventeen classes of certificates. The Certificates will
be
issued pursuant to a Pooling and Servicing Agreement for ACE Securities Corp.
Home Equity Loan Trust, Series 2007-WM2 Asset Backed Pass-Through Certificates,
dated as of March 1, 2007 (the “Pooling and Servicing Agreement”), among the
Purchaser as depositor, Xxxxx Fargo Bank, National Association as master
servicer (the “Master Servicer”) and securities administrator (the “Securities
Administrator”), HSBC Bank USA, National Association as trustee (the “Trustee”)
and Ocwen Loan Servicing, LLP (the “Servicer”). The Purchaser will sell the
Class A-1 Certificates (the “Class A-1 Certificates”), Class A-2A, Class A-2B,
Class A-2C and Class A-2D Certificates (collectively, the “Class A-2
Certificates”; together with the Class A-1 Certificates, the “Class A
Certificates”), the Class M-1, Class M-2, Class M-3, Class M-4, Class M-5, Class
M-6, Class M-7, Class M-8 and Class M-9 (collectively, the “Mezzanine
Certificates”) to Deutsche Bank Securities Inc. (“DBSI”), pursuant to the Second
Amended and Restated Underwriting Agreement, dated as of June 24, 1999, as
amended and restated to and including January 25, 2006, between the Purchaser
and DBSI, and the Terms Agreement, dated March 29, 2007 (collectively, the
“Underwriting Agreement”), between the Purchaser and DBSI. Capitalized terms
used but not defined herein shall have the meanings set forth in the Pooling
and
Servicing Agreement.
The
parties hereto agree as follows:
SECTION
1. Agreement
to Purchase.
The
Seller hereby sells, and the Purchaser hereby purchases, on March 30, 2007
(the
“Closing Date”), certain conventional, one- to four-family, fixed-rate and
adjustable-rate, residential, first and second lien, residential mortgage
loans
(the “Mortgage Loans”), having an aggregate principal balance as of the close of
business on March 1, 2007 (the “Cut-off Date”) of approximately $784,302,135
(the “Closing Balance”), after giving effect to all payments due on the Mortgage
Loans on or before the Cut-off Date, whether or not received, including the
right to any Prepayment Charges payable by the related Mortgagors in connection
with any Principal Prepayments on the Mortgage Loans, but excluding the rights
to the servicing of the Mortgage Loans, which are owned by Ocwen
Loan Servicing, LLC
(the
“Servicing Rights”) and (b) all of the Seller’s right, title and interest in and
to (i) the Cap Agreement between Deutsche Bank AG, New York Branch and the
Trustee, as trustee of ACE Securities Corp. Home Equity Loan Trust, Series
2007-WM2 Asset Backed Pass-Through Certificates dated as of March 30, 2007
(the
“Group I Cap Agreement”), relating to the Class A-1 Certificates and the
Mezzanine Certificates and (ii) the Cap Agreement between Deutsche Bank AG,
New
York Branch and the Trustee, as trustee of ACE Securities Corp. Home Equity
Loan
Trust, Series 2007-WM2 Asset Backed Pass-Through Certificates, dated as of
March
30, 2007 (the “Group II Cap Agreement”; together with the Group I Cap Agreement,
the “Cap Agreements”) relating to the Class A-2 Certificates and the Mezzanine
Certificates.
SECTION
2. Mortgage
Loan Schedule.
The
Purchaser and the Seller have agreed upon which of the mortgage loans owned
by
the Seller are to be purchased by the Purchaser pursuant to this Agreement
and
the Seller will prepare or cause to be prepared on or prior to the Closing
Date
a final schedule (the “Closing Schedule”) that shall describe such Mortgage
Loans and set forth all of the Mortgage Loans to be purchased under this
Agreement, including the Prepayment Charges. The Closing Schedule will conform
to the requirements set forth in this Agreement and to the definition of
“Mortgage Loan Schedule” under the Pooling and Servicing Agreement.
SECTION
3. Consideration.
(a) In
consideration for the Mortgage Loans and the Cap Agreements to be purchased
hereunder, the Purchaser shall, as described in Section 8, (i) pay to or
upon
the order of the Seller in immediately available funds an amount (the “Purchase
Price”) equal to (i) $________*1
and (ii)
a 100% interest in the Class CE, Class P and Class R Certificates (collectively
the “DB Certificates”). The DB Certificates shall be registered in the name of
“Deutsche Bank Securities Inc.”
(b) The
Purchaser or any assignee, transferee or designee of the Purchaser shall
be
entitled to all scheduled payments of principal due after the Cut-off Date,
all
other payments of principal due and collected after the Cut-off Date, and
all
payments of interest on the Mortgage Loans allocable to the period after
the
Cut-off Date. All scheduled payments of principal and interest due on or
before
the Cut-off Date and collected after the Cut-off Date shall belong to the
Seller.
(c) Pursuant
to the Pooling and Servicing Agreement, the Purchaser will assign all of
its
right, title and interest in and to the Mortgage Loans and the Cap Agreements,
together with its rights under this Agreement, to the Trustee for the benefit
of
the Certificateholders.
SECTION
4. Transfer
of the Mortgage Loans.
(a) Possession
of Mortgage Files.
The
Seller does hereby sell to the Purchaser, without recourse but subject to
the
terms of this Agreement, all of its right, title and interest in, to and
under
the Mortgage Loans, including the related Prepayment Charges and the Cap
Agreements, but excluding the Servicing Rights. The contents of each Mortgage
File not delivered to the Purchaser or to any assignee, transferee or designee
of the Purchaser on or prior to the Closing Date are and shall be held in
trust
by the Seller for the benefit of the Purchaser or any assignee, transferee
or
designee of the Purchaser. Upon the sale of the Mortgage Loans, the ownership
of
each Mortgage Note, the related Mortgage and the other contents of the related
Mortgage File is vested in the Purchaser and the ownership of all records
and
documents with respect to the related Mortgage Loan prepared by or that come
into the possession of the Seller on or after the Closing Date shall immediately
vest in the Purchaser and shall be delivered immediately to the Purchaser
or as
otherwise directed by the Purchaser.
__________________
* Please
contact the Mortgage Loan Seller for this information.
-2-
(b) Delivery
of Mortgage Loan Documents.
The
Seller will, on or prior to the Closing Date, deliver or cause to be delivered
to the Purchaser or any assignee, transferee or designee of the Purchaser
each
of the following documents for each Mortgage Loan:
(i) the
original Mortgage Note, including any riders thereto, endorsed in blank,
with
all prior and intervening endorsements showing a complete chain of endorsement
from the originator to the Person so endorsing to the Trustee;
(ii) the
original Mortgage or a certified copy thereof, including any riders thereto,
with evidence of recording thereon, and the original recorded power of attorney,
if the Mortgage was executed pursuant to a power of attorney, with evidence
of
recording thereon, and in the case of each MOM Loan, the original Mortgage,
noting the presence of the MIN of the Loan and either language indicating
that
the Mortgage Loan is a MOM Loan or if the Mortgage Loan was not a MOM Loan
at
origination, the original Mortgage and the assignment thereof to MERS®, with
evidence of recording indicated thereon;
(iii) unless
such Mortgage Loan is registered on the MERS System, an original Assignment
of
Mortgage executed in blank;
(iv) unless
such Mortgage Loan is a MOM Loan, the original recorded Assignment or
Assignments of the Mortgage, or a certified copy or copies thereof, showing
a
complete chain of assignment from the originator to the last Person assigning
the Mortgage;
(v) the
original or copies of each assumption, modification, written assurance or
substitution agreement, if any;
(vi) the
original lender’s title insurance policy, together with all endorsements or
riders that were issued with or subsequent to the issuance of such policy,
insuring the priority of the Mortgage as a first lien or second lien on the
Mortgaged Property represented therein as a fee interest vested in the
Mortgagor;
(vii) the
original of any guarantee executed in connection with the Mortgage Note,
if any;
and
(viii) the
original of any security agreement, chattel mortgage or equivalent document
executed in connection with the Mortgage, if any.
-3-
Notwithstanding
anything to the contrary contained in this Section 4, with respect to a maximum
of approximately 1.00% of the Mortgage Loans, by aggregate principal balance
of
the Mortgage Loans as of the Cut-off Date, if any original Mortgage Note
referred to in Section 4(b)(i) above cannot be located, the obligations of
the
Seller to deliver such documents shall be deemed to be satisfied upon delivery
to the Purchaser or any assignee, transferee or designee of the Purchaser
of a
photocopy of such Mortgage Note, if available, with a lost note affidavit
substantially in the form of Exhibit 1 attached hereto. If any of the original
Mortgage Notes for which a lost note affidavit was delivered to the Purchaser
or
any assignee, transferee or designee of the Purchaser is subsequently located,
such original Mortgage Note shall be delivered to the Purchaser or any assignee,
transferee or designee of the Purchaser within three (3) Business Days; and
if
any document referred to in Section 4(b)(ii) or 4(b)(iv) above has been
submitted for recording but either (x) has not been returned from the applicable
public recording office or (y) has been lost or such public recording office
has
retained the original of such document, the obligations of the Seller hereunder
shall be deemed to have been satisfied upon delivery to the Purchaser or
any
assignee, transferee or designee of the Purchaser promptly upon receipt thereof
by or on behalf of the Seller of either the original or a copy of such document
certified by the applicable public recording office to be a true and complete
copy of the original.
In
the
event that the original lender’s title insurance policy has not yet been issued,
the Seller shall deliver to the Purchaser or any assignee, transferee or
designee of the Purchaser a written commitment or interim binder or preliminary
report of title issued by the title insurance or escrow company. The Seller
shall deliver such original title insurance policy to the Purchaser or any
assignee, transferee or designee of the Purchaser promptly upon receipt by
the
Seller, if any.
Each
original document relating to a Mortgage Loan which is not delivered to the
Purchaser or its assignee, transferee or designee, if held by the Seller,
shall
be so held for the benefit of the Purchaser, its assignee, transferee or
designee.
In
connection with the assignment of any Mortgage Loan registered on the MERS®
System, the Seller further agrees that it will cause, at the Seller’s own
expense, within 30 days after the Closing Date, the MERS® System to indicate
that such Mortgage Loans have been assigned by the Seller to the Purchaser
and
by the Purchaser to the Trustee in accordance with this Agreement for the
benefit of the Certificateholders by including (or deleting, in the case
of
Mortgage Loans which are repurchased in accordance with this Agreement) in
such
computer files (a) the code in the field which identifies the specific Trustee
and (b) the code in the field “Pool Field” which identifies the series of the
Certificates issued in connection with such Mortgage Loans. The Seller further
agrees that it will not, and will not permit the Servicer or the Master Servicer
to alter the codes referenced in this paragraph with respect to any Mortgage
Loan during the term of this Agreement unless and until such Mortgage Loan
is
repurchased in accordance with the terms of this Agreement or the Pooling
and
Servicing Agreement.
(c) Acceptance
of Mortgage Loans.
The
documents delivered pursuant to Section 4(b) hereof shall be reviewed by
the
Purchaser or any assignee, transferee or designee of the Purchaser at any
time
before or after the Closing Date (and with respect to each document permitted
to
be delivered after the Closing Date, within seven days of its delivery) to
ascertain that all required documents have been executed and received and
that
such documents relate to the Mortgage Loans identified on the Closing
Schedule.
-4-
(d) Transfer
of Interest in Agreements.
The
Purchaser has the right to assign its interest under this Agreement, in whole
or
in part, to the Trustee, as may be required to effect the purposes of the
Pooling and Servicing Agreement, without the consent of the Seller, and the
assignee shall succeed to the rights and obligations hereunder of the Purchaser.
Any expense reasonably incurred by or on behalf of the Purchaser or the Trustee
in connection with enforcing any obligations of the Seller under this Agreement
will be promptly reimbursed by the Seller.
(e) Examination
of Mortgage Files.
Prior
to the Closing Date, the Seller shall either (i) deliver in escrow to the
Purchaser or to any assignee, transferee or designee of the Purchaser for
examination the Mortgage File pertaining to each Mortgage Loan, or (ii) make
such Mortgage Files available to the Purchaser or to any assignee, transferee
or
designee of the Purchaser for examination. Such examination may be made by
the
Purchaser or the Trustee, and their respective designees, upon reasonable
notice
to the Seller during normal business hours before the Closing Date and within
sixty (60) days after the Closing Date. If any such person makes such
examination prior to the Closing Date and identifies any Mortgage Loans that
do
not conform to the requirements of the Purchaser as described in this Agreement,
such Mortgage Loans shall be deleted from the Closing Schedule. The
Purchaser may, at its option and without notice to the Seller, purchase all
or
part of the Mortgage Loans without conducting any partial or complete
examination. The fact that the Purchaser or any person has conducted
or has failed to conduct any partial or complete examination of the Mortgage
Files shall not affect the rights of the Purchaser or any assignee, transferee
or designee of the Purchaser to demand repurchase or other relief as provided
herein or under the Pooling and Servicing Agreement.
SECTION
5. Representations,
Warranties and Covenants of the Seller.
The
Seller hereby represents and warrants to the Purchaser, as of the date hereof
and as of the Closing Date, and covenants, that:
(i) The
Seller is a Delaware corporation with full corporate power and authority
to
conduct its business as presently conducted by it to the extent material
to the
consummation of the transactions contemplated herein. The Agreement has been
duly authorized, executed and delivered by the Seller. The Seller had the
full
corporate power and authority to own the Mortgage Loans and to transfer and
convey the Mortgage Loans to the Purchaser and has the full corporate power
and
authority to execute and deliver, engage in the transactions contemplated
by,
and perform and observe the terms and conditions of this Agreement;
(ii) The
Seller has duly authorized the execution, delivery and performance of this
Agreement, has duly executed and delivered this Agreement, and this Agreement,
assuming due authorization, execution and delivery by the Purchaser, constitutes
a legal, valid and binding obligation of the Seller, enforceable against
it in
accordance with its terms except as the enforceability thereof may be limited
by
bankruptcy, insolvency or reorganization or by general principles of
equity;
-5-
(iii) The
execution, delivery and performance of this Agreement by the Seller (x) does
not
conflict and will not conflict with, does not breach and will not result
in a
breach of and does not constitute and will not constitute a default (or an
event, which with notice or lapse of time or both, would constitute a default)
under (A) any terms or provisions of the organizational documents of the
Seller,
(B) any term or provision of any material agreement, contract, instrument
or
indenture, to which the Seller is a party or by which the Seller or any of
its
property is bound, or (C) any law, rule, regulation, order, judgment, writ,
injunction or decree of any court or governmental authority having jurisdiction
over the Seller or any of its property and (y) does not create or impose
and
will not result in the creation or imposition of any lien, charge or encumbrance
(other than any created hereby in favor of the Purchaser and its assignees)
which would have a material adverse effect upon the Mortgage Loans or any
documents or instruments evidencing or securing the Mortgage Loans;
(iv) No
consent, approval, authorization or order of, registration or filing with,
or
notice on behalf of the Seller to any governmental authority or court is
required, under federal laws or the laws of the State of New York, for the
execution, delivery and performance by the Seller of, or compliance by the
Seller with, this Agreement or the consummation by the Seller of any other
transaction contemplated hereby and by the Pooling and Servicing Agreement;
provided, however, that the Seller makes no representation or warranty regarding
federal or state securities laws in connection with the sale or distribution
of
the Certificates;
(v) The
Seller is not in violation of, and the execution and delivery of this Agreement
by the Seller and its performance and compliance with the terms of this
Agreement will not constitute a violation with respect to, any order or decree
of any court or any order or regulation of any federal, state, municipal
or
governmental agency having jurisdiction over the Seller or its assets, which
violation might have consequences that would materially and adversely affect
the
condition (financial or otherwise) or the operation of the Seller or its
assets
or might have consequences that would materially and adversely affect the
performance of its obligations and duties hereunder;
(vi) The
Seller does not believe, nor does it have any reason or cause to believe,
that
it cannot perform each and every covenant contained in this
Agreement;
(vii) Immediately
prior to the sale of the Mortgage Loans to the Purchaser as herein contemplated,
the Seller was the owner of the related Mortgage and the indebtedness evidenced
by the related Mortgage Note, and, upon the payment to the Seller of the
Purchase Price, in the event that the Seller retains or has retained record
title, the Seller shall retain such record title to each Mortgage, each related
Mortgage Note and the related Mortgage Files with respect thereto in trust
for
the Purchaser as the owner thereof from and after the date hereof;
(viii) There
are
no actions or proceedings against, or investigations known to it of, the
Seller
before any court, administrative or other tribunal (A) that might prohibit
its
entering into this Agreement, (B) seeking to prevent the sale of the Mortgage
Loans by the Seller or the consummation of the transactions contemplated
by this
Agreement or (C) that might prohibit or materially and adversely affect the
performance by the Seller of its obligations under, or validity or
enforceability of, this Agreement;
-6-
(ix) The
consummation of the transactions contemplated by this Agreement are in the
ordinary course of business of the Seller, and the transfer, assignment and
conveyance of the Mortgage Notes and the Mortgages by the Seller pursuant
to
this Agreement are not subject to the bulk transfer or any similar statutory
provisions in effect in any relevant jurisdiction, except any as may have
been
complied with;
(x) The
Seller has not dealt with any broker, investment banker, agent or other person,
except for the Purchaser or any of its affiliates, that may be entitled to
any
commission or compensation in connection with the sale of the Mortgage Loans
(except that an entity that previously financed the Seller’s ownership of the
Mortgage Loans may be entitled to a fee to release its security interest
in the
Mortgage Loans, which fee shall have been paid and which security interest
shall
have been released on or prior to the Closing Date);
(xi) There
is
no litigation currently pending or, to the best of the Seller’s knowledge
without independent investigation, threatened against the Seller that would
reasonably be expected to adversely affect the transfer of the Mortgage Loans,
the issuance of the Certificates or the execution, delivery, performance
or
enforceability of this Agreement, or that would result in a material adverse
change in the financial condition of the Seller; and
(xii) The
information set forth in the applicable part of the Closing Schedule relating
to
the existence of a Prepayment Charge is complete, true and correct in all
material respects at the date or dates respecting which such information
is
furnished and each Prepayment Charge is permissible and enforceable in
accordance with its terms upon the mortgagor’s full and voluntary principal
prepayment under applicable law, 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; (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.
SECTION
6. Representations
and Warranties of the Seller Relating to the Mortgage Loans.
The
Seller hereby represents and warrants to the Purchaser that as to each Mortgage
Loan as of the Closing Date:
(i) Information
provided to the Rating Agencies, including the loan level detail, is true
and
correct according to the Rating Agency requirements;
(ii) No
error,
omission, misrepresentation, fraud or similar occurrence with respect to
a
Mortgage Loan has taken place on the part of any person involved in the
origination of the Mortgage Loan, including without limitation, the Mortgagor,
any appraiser, any builder or developer, or any other party involved in the
origination of the Mortgage Loan or in the application of any insurance in
relation to such Mortgage Loan;
-7-
(iii) Except
as
set forth on the Closing Schedule, all payments required to be made prior
to the
Cut-off Date with respect to each Mortgage Loan have been made;
(iv) [Reserved];
(v) There
are
no delinquent taxes, assessment liens or insurance premiums affecting the
related Mortgaged Property;
(vi) The
terms
of the Mortgage Note and the Mortgage have not been materially impaired,
waived,
altered or modified in any respect, except by written instruments, recorded
in
the applicable public recording office if necessary to maintain the lien
priority of the Mortgage. The substance of any such waiver, alteration or
modification has been approved by the title insurer, to the extent required
by
the related policy. No Mortgagor has been released, in whole or in part,
except
in connection with an assumption agreement (approved by the title insurer
to the
extent required by the policy) and which assumption agreement has been delivered
to the Trustee;
(vii) The
Mortgaged Property is insured against loss by fire and hazards of extended
coverage (excluding earthquake insurance) in an amount which is at least
equal
to the lesser of (i) the amount necessary to compensate for any damage or
loss
to the improvements which are a part of such property on a replacement cost
basis or (ii) the outstanding principal balance of the Mortgage Loan. If
the
Mortgaged Property is in an area identified on a flood hazard map or flood
insurance rate map issued by the Federal Emergency Management Agency as having
special flood hazards (and such flood insurance has been made available),
a
flood insurance policy meeting the requirements of the current guidelines
of the
Federal Insurance Administration is in effect. All such insurance policies
contain a standard mortgagee clause naming the originator of the Mortgage
Loan,
its successors and assigns as mortgagee and the Seller has not engaged in
any
act or omission which would impair the coverage of any such insurance policies.
Except as may be limited by applicable law, the Mortgage obligates the Mortgagor
thereunder to maintain all such insurance at the Mortgagor’s cost and expense,
and on the Mortgagor’s failure to do so, authorizes the holder of the Mortgage
to maintain such insurance at Mortgagor’s cost and expense and to seek
reimbursement therefor from the Mortgagor;
(viii) Each
Mortgage Loan and the related Prepayment Charge, if any, complied in all
material respects with any and all requirements of any federal, state or
local
law including, without limitation, usury, truth in lending, anti-predatory
lending, real estate settlement procedures, consumer credit protection, equal
credit opportunity, fair housing or disclosure laws applicable to the
origination and servicing of the Mortgage Loans and the consummation of the
transactions contemplated hereby will not involve the violation of any such
laws;
(ix) The
Mortgage has not been satisfied, cancelled, subordinated (other than with
respect to second lien Mortgage Loans, the subordination to the first lien)
or
rescinded, in whole or in part, and the Mortgaged Property has not been released
from the lien of the Mortgage, in whole or in part, nor has any instrument
been
executed that would effect any such satisfaction, cancellation, subordination,
rescission or release;
-8-
(x) The
Mortgage Note and the related Mortgage are genuine and each is the legal,
valid
and binding obligation of the maker thereof, insured under the related title
policy, and enforceable in accordance with its terms, except to the extent
that
the enforceability thereof may be limited by a bankruptcy, insolvency or
reorganization;
(xi) The
Mortgage Note and the related Mortgage are genuine and each is the legal,
valid
and binding obligation of the maker thereof, enforceable in accordance with
its
terms, subject to bankruptcy, insolvency, moratorium, receivership and other
similar laws relating to creditors’ rights generally;
(xii) The
Seller is the sole legal, beneficial and equitable owner of the Mortgage
Note
and the Mortgage and has the full right to convey, transfer and sell the
Mortgage Loan to the Purchaser free and clear of any encumbrance, equity,
lien
(other than with respect to second lien Mortgage Loans, the subordination
to the
related first lien), pledge, charge, claim or security interest and immediately
upon the sale, assignment and endorsement of the Mortgage Loans from the
Seller
to the Purchaser, the Purchaser shall have good and indefeasible title to
and be
the sole legal owner of the Mortgage Loans subject only to any encumbrance,
equity, lien, pledge, charge, claim or security interest arising out of the
Purchaser’s actions;
(xiii) Unless
the Mortgaged Property is located in the State of Iowa and an attorney’s
certificate and/or a certificate of title guaranty has been obtained, each
Mortgage Loan is covered by a valid and binding American Land Title Association
lender’s title insurance policy issued by a title insurer qualified to do
business in the jurisdiction where the Mortgaged Property is located. No
claims
have been filed under such lender’s title insurance policy, and the Seller has
not done, by act or omission, anything that would impair the coverage of
the
lender’s title insurance policy;
(xiv) There
is
no material default, breach, violation event or event of acceleration existing
under the Mortgage or the Mortgage Note and no event which, with the passage
of
time or with notice and the expiration of any grace or cure period, would
constitute a material default, breach, violation or event of acceleration,
and
the Seller has not, nor has its predecessors, waived any material default,
breach, violation or event of acceleration;
(xv) There
are
no mechanics’ or similar liens or claims which have been filed for work, labor
or material provided to the related Mortgaged Property prior to the origination
of the Mortgage Loan which are or may be liens prior to, or equal or coordinate
with, the lien of the related Mortgage, except as may be disclosed in the
related title policy;
(xvi) Except
with respect to approximately 10.78% of the Group I Mortgage Loans and
approximately 13.39% of the Group II Mortgage Loans by aggregate principal
balance as of the Cut-off Date, which are interest-only loans and approximately
54.87% of the Group I Mortgage Loans and approximately 57.42% of the Group
II
Mortgage Loans by aggregate principal balance as of the Cut-off Date, which
are
balloon loans, each Mortgage Note is payable on the first day of each month
in
equal monthly installments of principal and interest (subject to adjustment
in
the case of the adjustable rate Mortgage Loans), with interest calculated
on a
30/360 basis and payable in arrears, sufficient to amortize the Mortgage
Loan
fully by the stated maturity date over an original term from commencement
of
amortization to not more than 30 years and no Mortgage Loan permits negative
amortization;
-9-
(xvii) The
servicing practices used in connection with the servicing of the Mortgage
Loans
have been in all respects reasonable and customary in the mortgage servicing
industry of like mortgage loan servicers, servicing similar subprime mortgage
loans originated in the same jurisdiction as the Mortgaged
Property;
(xviii) At
the
time of origination of the Mortgage Loan there was no proceeding pending
for the
total or partial condemnation of the Mortgaged Property and, as of the date
such
Mortgage Loan was purchased by the Purchaser, to the best of the Purchaser’s
knowledge there is no proceeding pending for the total or partial condemnation
of the Mortgaged Property;
(xix) The
Mortgage and related Mortgage Note contain customary and enforceable provisions
such as to render the rights and remedies of the holder thereof adequate
for the
realization against the Mortgaged Property of the benefits of the security
provided thereby, including, (a) in the case of a Mortgage designated as
a deed
of trust, by trustee’s sale, and (b) otherwise by judicial
foreclosure;
(xx) The
Mortgage Note is not and has not been secured by any collateral except the
lien
of the related Mortgage referred to in subsection (x) above;
(xxi) In
the
event the Mortgage constitutes a deed of trust, a trustee, duly qualified
under
applicable law to serve as such, has been properly designated and currently
so
serves and is named in the Mortgage, and no fees or expenses are or will
become
payable by the Seller to the trustee under the deed of trust, except in
connection with a trustee’s sale after default by the Mortgagor;
(xxii) The
Mortgage Note and the Mortgage are not subject to any right of rescission,
set-off, counterclaim or defense, including the defense of usury, nor will
the
operation of any of the terms of the Mortgage Note and/or the Mortgage, or
the
exercise of any right thereunder, render the Mortgage Note or the Mortgage
unenforceable, in whole or in part, or subject to any right of rescission,
set-off, counterclaim or defense, including the defense of usury and no such
right of rescission, set-off, counterclaim or defense has been asserted with
respect thereto, subject to bankruptcy, insolvency, moratorium, receivership
and
other similar laws relating to creditors’ rights generally;
(xxiii) The
Mortgage Loans were underwritten in accordance with the originator’s
underwriting guidelines in effect at the time the Mortgage Loans were originated
(the “Applicable Underwriting Guidelines”), except with respect to certain of
those Mortgage Loans which had compensating factors permitting a deviation
from
the Applicable Underwriting Guidelines;
-10-
(xxiv) The
Mortgaged Property is free of material damage and waste, excepting therefrom
any
Mortgage Loan subject to an escrow withhold as shown on the Closing
Schedule;
(xxv) All
of
the improvements which were included in determining the appraised value of
the
Mortgaged Property lie wholly within the Mortgaged Property’s boundary lines and
no improvements on adjoining properties encroach upon the Mortgaged Property,
excepting therefrom: (i) any encroachment insured against in the lender’s title
insurance policy identified in subsection (xiii), (ii) any encroachment
generally acceptable to subprime mortgage loan originators doing business
in the
same jurisdiction as the Mortgaged Property, and (iii) any encroachment which
does not materially interfere with the benefits of the security intended
to be
provided by such Mortgage;
(xxvi) All
parties to the Mortgage Note had the legal capacity to execute the Mortgage
Note
and the Mortgage, and the Mortgage Note and the Mortgage have been duly executed
by such parties;
(xxvii) To
the
best of the Seller’s knowledge, at the time of origination of the Mortgage Loan,
no appraised improvement located on or being part of the Mortgaged Property
was
in violation of any applicable zoning law or regulation and all inspections,
licenses and certificates required in connection with the origination of
any
Mortgage Loan with respect to the occupancy of the Mortgaged Property, have
been
made or obtained from the appropriate authorities;
(xxviii) No
Mortgagor has notified the Seller of any relief requested or allowed under
the
Servicemembers Civil Relief Act;
(xxix) All
parties which have held an interest in the Mortgage Loan are (or during the
period in which they held and disposed of such interest, were) (1) in compliance
with any and all applicable licensing requirements of the state wherein the
Mortgaged Property is located, (2) organized under the laws of such state,
(3)
qualified to do business in such state, (4) a federal savings and loan
association or national bank, (5) not doing business in such state, or (6)
exempt from the applicable licensing requirements of such state;
(xxx) The
Mortgage File contains an appraisal of the related Mortgaged Property which
was
made prior to the approval of the Mortgage Loan by a qualified appraiser,
duly
appointed by the related originator and was made in accordance with the
Financial Institutions Reform, Recovery, and Enforcement Act of
1989;
(xxxi) Except
as
may otherwise be limited by applicable law, the Mortgage contains a provision
for the acceleration of the payment of the unpaid principal balance of the
Mortgage Loan in the event that the Mortgaged Property is sold or transferred
without the prior written consent of the Mortgagee thereunder;
(xxxii) The
Mortgage Loan does not contain any provision which would constitute a “buydown”
provision and pursuant to which Monthly Payments are paid or partially paid
with
funds deposited in a separate account established by the related originator,
the
Mortgagor or anyone on behalf of the Mortgagor, or paid by any source other
than
the Mortgagor. The Mortgage Loan is not a “graduated payment mortgage loan” and
the Mortgage loan does not have a shared appreciation or other contingent
interest feature;
-11-
(xxxiii) To
the
best of the Seller’s knowledge there is no action or proceeding directly
involving the Mortgaged Property presently pending in which compliance with
any
environmental law, rule or regulation is at issue and the Seller has received
no
notice of any condition at the Mortgaged Property which is reasonably likely
to
give rise to an action or proceeding in which compliance with any environmental
law, rule or regulation is at issue;
(xxxiv) Each
Mortgage Loan is an obligation which is principally secured by an interest
in
real property within the meaning of Treasury Regulation section
1.860G-2(a);
(xxxv) Each
Mortgage Loan (a) is directly secured by a first or second lien on, and consists
of a single parcel of, real property with a detached one-to-four family
residence erected thereon or an individual condominium unit in a condominium
project. Any unit in a condominium project conforms to the requirements of
the
Applicable Underwriting Guidelines regarding such dwellings. No residence
or
dwelling is a mobile home or a manufactured dwelling unless it is a manufactured
dwelling, which is permanently affixed to a foundation and treated as “real
estate” under applicable law. No Mortgaged Property is used for commercial
purposes. Mortgaged Properties which contain a home office shall not be
considered as being used for commercial purposes as long as the Mortgaged
Property has not been altered for commercial purposes and is not storing
any
chemicals or raw materials other than those commonly used for homeowner repair,
maintenance and/or household purposes;
(xxxvi) The
Mortgage Interest Rate with respect to the Adjustable Rate Mortgage Loans
is
subject to adjustment at the time and in the amounts as are set forth in
the
related Mortgage Note;
(xxxvii) No
Mortgage Loan contains a provision whereby the Mortgagor can convert an
Adjustable Rate Mortgage Loan into a Fixed Rate Mortgage Loan;
(xxxviii)
With
respect to each Group I Mortgage Loan, no Mortgagor obtained a prepaid
single-premium credit-life, credit-disability, credit unemployment or credit
property insurance policy in connection with the origination of such Group
I
Mortgage Loan;
(xxxix) With
respect to each Group I Mortgage Loan that has a prepayment penalty feature,
each such prepayment penalty is enforceable and will be enforced by the
originator, as servicer of the Group I Mortgage Loan, for the benefit of
the
Purchaser, and each prepayment penalty is permitted pursuant to federal,
state
and local law. Each such prepayment penalty is in an amount equal to the
maximum
amount permitted under applicable law and no such prepayment penalty may
be
imposed for a term in excess of three (3) years. With respect to any Group
I
Mortgage Loan that contains a provision permitting imposition of a prepayment
penalty upon a prepayment prior to maturity: (i) prior to the loan’s
origination, the Mortgagor agreed to such prepayment penalty in exchange
for a
monetary benefit, including but not limited to a rate or fee reduction, (ii)
originator has available programs that offered the option of obtaining a
mortgage loan that did not require payment of such a prepayment penalty and
prior to the Mortgage Loan’s origination, the Mortgage Loan was available to the
Mortgagor with and without the prepayment penalty, (iii) the prepayment penalty
was disclosed to the Mortgagor in the loan documents pursuant to applicable
state and federal law, and (iv) notwithstanding the
terms of the Group I Mortgage Loan or any
state or federal law to the contrary, the servicer will not impose such
prepayment penalty in any instance when the mortgage debt is accelerated
as the
result of the Mortgagor’s default in making the loan payments;
-12-
(xl) No
Mortgage Loan is (a) subject to, covered by or in violation of the provisions
of
the Home Ownership and Equity Protection Act of 1994, as amended (“HOEPA”), or
has an “annual percentage rate” or “total points and fees” payable by the
Mortgagor (as each such term is defined under HOEPA) that equal or exceed
the
applicable thresholds defined under HOEPA (Section 32 of Regulation Z, 12
C.F.R.
Section 226.32(a)(1)(i) and (ii)), (b) a “high cost”, “covered” (except with
respect to purchase money “covered loans” under the New Jersey Home Ownership
Security Act of 2002), “abusive”, “predatory”, “home loan”, “Oklahoma Section
10” or “high risk” mortgage loan (or a similarly designated loan using different
terminology) under any federal, state or local law, including without
limitation, the provisions of the Georgia Fair Lending Act, New York Banking
Law, Section 6-1, the Arkansas Home Loan Protection Act, effective as of
June
14, 2003, Kentucky State Statute KRS 360.100, effective as of June 25, 2003,
the
New Jersey Home Ownership Security Act of 2002 (the “NJ Act”), the New Mexico
Home Loan Protection Act (N.M. Stat. Xxx. §§ 58-21A-1 et seq.), the Illinois
High-Risk Home Loan Act (815 Ill. Comp. Stat. 137/1 et seq.), the Oklahoma
Home
Ownership and Equity Protection Act, Nevada Assembly Xxxx No. 284, effective
as
of Oct. 1, 2003, the Minnesota Residential Mortgage Originator and Servicer
Licensing Act (MN Stat. §58.137), the South Carolina High-Cost and Consumer Home
Loans Act, effective January 1, 2004, the Massachusetts Predatory Home Loan
Practices Act, effective November 7, 2004 (Mass. Xxx. Laws Ch. 183C) or any
other statute or regulation providing assignee liability to holders of such
mortgage loans, or (c) subject to or in violation of any such or comparable
federal, state or local statutes or regulations;
(xli) No
Mortgage Loan originated or modified on or after October 1, 2002 and prior
to
March 7, 2003 is secured by a Mortgaged Property located in the State of
Georgia. There is no such Mortgage Loan underlying the Certificate that was
originated on or after March 7, 2003, which is a “high cost home loan” as
defined under the Georgia Fair Lending Act;
(xlii) [Reserved];
(xliii) [Reserved];
(xliv) There
is
no Mortgage Loan that (a) is secured by property located in the State of
Kentucky; (b) was originated on or after June 24, 2003, and (c) which is
a “high
cost home loan” as defined under Kentucky State Statute KRS 360.100, effective
as of June 24, 2003;
(xlv) There
is
no Mortgage Loan that (a) is secured by property located in the State of
Arkansas, (b) has a note date on or after July 16, 2003, and (c) which is
a
“high cost home loan” as defined under the Arkansas Home Loan Protection Act,
effective as of July 16, 2003;
-13-
(xlvi) The
Servicer for each Group I Mortgage Loan has fully furnished, and will fully
furnish, in accordance with the Fair Credit Reporting Act and its implementing
regulations, accurate and complete information (i.e., favorable and unfavorable)
on its Mortgagor credit files to Equifax, Experian, and Trans Union Credit
Information Company (three of the credit repositories), on a monthly
basis;
(xlvii) The
original principal balance of each Group I Mortgage Loan which is secured
by a
first or second lien on the related Mortgaged Property is within Xxxxxxx
Mac’s
dollar amount limits for conforming one-to-four family mortgage loans;
(xlviii) No
Mortgage Loan is a “High-Cost Home Loan” as defined in the New Jersey Home
Ownership Act effective November 27, 2003 (N.J.S.A. 46:10B-22 et seq.);
(xlix) No
Mortgage Loan is a “High-Cost Home Loan” as defined in the New Mexico Home Loan
Protection Act effective January 1, 2004 (N.M. Stat. Xxx. §§ 58-21A-1 et
seq.);
(l) No
Mortgage Loan is a “High-Risk Home Loan” as defined in the Illinois High-Risk
Home Loan Act effective January 1, 2004 (815 Ill. Comp. Stat. 137/1 et
seq.);
(li) [Reserved];
(lii) [Reserved];
(liii) No
Mortgage Loan is a “High Cost” loan as defined under the New York Banking Law
Section 6L, effective as of April 1, 2003;
(liv) No
Mortgage Loan is a “home loan” in the state of Nevada;
(lv) No
Mortgage Loan is a “Section 10 mortgage loan” as defined in Oklahoma House Xxxx
1574;
(lvi) With
respect to any Group I Mortgage Loan originated on or after August 1, 2004,
neither the related Mortgage nor the related Mortgage Note requires the
Mortgagor to submit to arbitration to resolve any dispute arising out of
or
relating in any way to the Mortgage Loan transaction;
(lvii) No
Mortgage Loan is a High Cost Loan or Covered Loan, as applicable (as such
terms
are defined in the then current Standard & Poor’s LEVELS®
Glossary
which is now Version 5.7, Appendix E (attached hereto as Exhibit 2)) and
no
Mortgage Loan originated or modified on or after October 1, 2002 and prior
to
March 7, 2003 is secured by a Mortgaged Property located in the State of
Georgia;
-14-
(lviii) No
Mortgage Loan is a “High-Cost Home Mortgage Loan” as defined in the
Massachusetts Predatory Home Loan Practices Act, effective November 7, 2004
(Mass. Xxx. Laws Ch. 183C);
(lix) [Reserved];
(lx) [Reserved];
(lxi) The
methodology used in underwriting the extension of credit for each Group I
Mortgage Loan employs objective mathematical principles which relate the
Mortgagor’s income, assets and liabilities to the proposed payment and such
underwriting methodology does not rely on the extent of the Mortgagor’s equity
in the collateral as the principal determining factor in approving such credit
extension. Such underwriting methodology confirmed that at the time of
origination (application/approval) the Mortgagor had a reasonable ability
to
make timely payments on the Group I Mortgage Loan;
(lxii) [Reserved];
(lxiii) [Reserved];
(lxiv) With
respect to any Group I Mortgage Loans that are manufactured housing, upon
the
origination of each such Group I Mortgage Loan the manufactured housing unit
either: (i) will be the principal residence of the Mortgagor or (ii) will
be
classified as real property under applicable state law;
(lxv) [Reserved];
(lxvi) With
respect to any Mortgage Loan that is secured by a second lien on the related
Mortgaged Property, either (i) no consent for the Mortgage Loan is required
by
the holder of any related senior lien or (ii) such consent has been obtained
and
is contained in the Mortgage File;
(lxvii) Each
Mortgagor of a Group I Mortgage Loan was assigned the highest credit grade
available with respect to a mortgage loan product offered by such Group I
Mortgage Loan’s originator, taking into account credit history, debt to income
ratio and loan requirements of such Mortgagor of such Group I Mortgage
Loan;
(lxviii) With
respect to a Mortgage Loan which is a second lien, as of the date hereof,
the
Seller has not received a notice of default of a senior lien on the related
Mortgaged Property which has not been cured;
(lxix) With
respect to a Group I Mortgage Loan which is a second lien, (a) such second
lien
Group I Mortgage Loan is secured by a one- to four-family residence that
is the
principal residence of the Mortgagor, (b) the origination amount for such
second
lien Group I Mortgage Loan did not exceed one-half of the one-unit limitation
set forth by Xxxxxxx Mac for first lien mortgage loans, without regard to
the
number of units, and (c) the aggregate original principal balance for the
first
lien and the second lien mortgage Loan do not exceed Xxxxxxx Mac’s applicable
loan limits for first lien mortgage loans for properties of the same type
as the
related Mortgaged Property;
-15-
(lxx) No
Mortgagor under a
Group I Mortgage Loan was charged “points and fees” in an amount greater than
(a)
$1,000 or (b) 5%
of the principal amount of such
Group I Mortgage Loan, whichever is greater. For purposes of this
representation, “points and fees” (x) include origination, underwriting, broker
and finder’s fees and charges that the lender imposed as a condition of making
the mortgage loan, whether they are paid to the lender or a third party;
and (y)
exclude bona fide discount points, fees paid for actual services rendered
in
connection with the origination of the mortgage (such as attorneys’ fees,
notaries fees and fees paid for property appraisals, credit reports, surveys,
title examinations and extracts, flood and tax certifications, and home
inspections); the cost of mortgage insurance or credit-risk price adjustments;
the costs of title, hazard, and flood insurance policies; state and local
transfer taxes or fees; escrow deposits for the future payment of taxes and
insurance premiums; and other miscellaneous fees and charges, which
miscellaneous fee and charges, in total, do not exceed 0.25 percent of the
loan
amount;
(lxxi) No
selection procedures were used by the Seller that identified the Mortgage
Loans
as being less desirable or valuable than other comparable mortgage loans
in the
Seller’s portfolio;
(lxxii) The
information set forth in the Closing Schedule is true and correct in all
material respects as of the Cut-off Date;
(lxxiii) No
Mortgage Loan is secured in whole or in part by the interest of the Mortgagor
as
a lessee under a ground lease of the related Mortgaged Property;
(lxxiv) With
respect to each first lien Mortgage Loan, the related Mortgage File contains
an
appraisal on Form 1004 or 2055, and with respect to each second lien Mortgage
Loan, the related Mortgage File contains an appraisal on form 704, 2065 or
2055
with an exterior only inspection; and
(lxxv) No
Group I Mortgage Loan is a Seasoned Mortgage Loan. Seasoned Mortgage Loan
as
used herein, shall mean a Mortgage Loan for which the related Mortgage Note
is
dated more than 1 year before the date of issuance of the Certificates.
SECTION
7. Repurchase
Obligation for Defective Documentation and for Breach of Representation and
Warranty.
(a) The
representations and warranties contained in Section 6 shall not be impaired
by
any review and examination of loan files or other documents evidencing or
relating to the Mortgage Loans or any failure on the part of the Seller or
the
Purchaser to review or examine such documents and shall inure to the benefit
of
any assignee, transferee or designee of the Purchaser, including the Trustee
for
the benefit of the Certificateholders. With respect to the representations
and
warranties contained herein as to which the Seller has no knowledge, if it
is
discovered that the substance of any such representation and warranty was
inaccurate as of the date such representation and warranty was made or deemed
to
be made, and such inaccuracy materially and adversely affects the value of
the
related Mortgage Loan or the interest therein of the Purchaser or the
Purchaser’s assignee, transferee or designee, then notwithstanding the lack of
knowledge by the Seller with respect to the substance of such representation
and
warranty being inaccurate at the time the representation and warranty was
made,
the Seller shall take such action described in the following paragraph in
respect of such Mortgage Loan. Notwithstanding anything to the contrary
contained herein, any breach of a representation or warranty contained in
clauses (viii), (xxxviii), (xxxix), (xl), (xli), (xlvi), (xlvii), (lvi),
(lxi),
(lxiv), (lxvii), (lxix) and (lxx) of Section 6 above, shall be automatically
deemed to affect materially and adversely the interests of the Purchaser
or the
Purchaser’s assignee, transferee or designee.
-16-
Upon
discovery by the Seller, the Purchaser or any assignee, transferee or designee
of the Purchaser of any materially defective document in, or that any material
document was not transferred by the Seller, as listed on a Custodian’s
preliminary exception report, as described in the Custodial Agreement, as
part
of any Mortgage File, or of a breach of any of the representations and
warranties contained in Section 6 that materially and adversely affects the
value of any Mortgage Loan or the interest therein of the Purchaser or the
Purchaser’s assignee, transferee or designee, the party discovering such breach
shall give prompt written notice to the Seller. Within sixty (60) days of
its
discovery or its receipt of notice of any such missing documentation that
was
not transferred by the Seller as described above, or of materially defective
documentation, or any such breach of a representation and warranty, the Seller
promptly shall deliver such missing document or cure such defect or breach
in
all material respects or, in the event the Seller cannot deliver such missing
document or cannot cure such defect or breach, the Seller shall, within ninety
(90) days of its discovery or receipt of notice of any such missing or
materially defective documentation or of any such breach of a representation
and
warranty, either (i) repurchase the affected Mortgage Loan at the Purchase
Price
(as such term is defined in the Pooling and Servicing Agreement) or (ii)
pursuant to the provisions of the Pooling and Servicing Agreement, cause
the
removal of such Mortgage Loan from the Trust Fund and substitute one or more
Qualified Substitute Mortgage Loans. The Seller shall amend the Closing Schedule
to reflect the withdrawal of such Mortgage Loan from the terms of this Agreement
and the Pooling and Servicing Agreement. The Seller shall deliver to the
Purchaser such amended Closing Schedule and shall deliver such other documents
as are required by this Agreement or the Pooling and Servicing Agreement
within
five (5) days of any such amendment. Any repurchase pursuant to this Section
7(a) shall be accomplished by transfer to an account designated by the Purchaser
of the amount of the Purchase Price in accordance with Section 2.03 of the
Pooling and Servicing Agreement. Any repurchase required by this Section
shall
be made in a manner consistent with Section 2.03 of the Pooling and Servicing
Agreement.
(b) If
the
representation made by the Seller in Section 5(xii) is breached, the Seller
shall not have the right or obligation to cure, substitute or repurchase
the
affected Mortgage Loan but shall remit to the Servicer for deposit in the
Collection Account, prior to the next succeeding Servicer Remittance Date,
the
amount of the Prepayment Charge indicated on the applicable part of the Closing
Schedule to be due from the Mortgagor in the circumstances less any amount
collected and remitted to the Servicer for deposit into the Collection
Account.
(c) It
is
understood and agreed that the obligations of the Seller set forth in this
Section 7 to cure or repurchase a defective Mortgage Loan (and to make payments
pursuant to Section 7(b)) constitute the sole remedies of the Purchaser against
the Seller respecting a missing document or a breach of the representations
and
warranties contained in Section 5(xii) or Section 6.
-17-
SECTION
8. Closing;
Payment for the Mortgage Loans. The
closing of the purchase and sale of the Mortgage Loans and the Cap Agreements,
shall be held at the New York City office of Xxxxxxx Xxxxxxxx & Wood
llp
at 10:00
a.m. New York City time on the Closing Date.
The
closing shall be subject to each of the following conditions:
(a) All
of
the representations and warranties of the Seller under this Agreement shall
be
true and correct in all material respects as of the date as of which they
are
made and no event shall have occurred which, with notice or the passage of
time,
would constitute a default under this Agreement;
(b) The
Purchaser shall have received, or the attorneys of the Purchaser shall have
received in escrow (to be released from escrow at the time of closing), all
closing documents as specified in Section 9 of this Agreement, in such forms
as
are agreed upon and acceptable to the Purchaser, duly executed by all
signatories other than the Purchaser as required pursuant to the respective
terms thereof;
(c) The
Seller shall have delivered or caused to be delivered and released to the
Purchaser or to its designee, all documents (including without limitation,
the
Mortgage Loans) required to be so delivered by the Purchaser pursuant to
Section
2.01 of the Pooling and Servicing Agreement; and
(d) All
other
terms and conditions of this Agreement and the Pooling and Servicing Agreement
shall have been complied with.
Subject
to the foregoing conditions, the Purchaser shall deliver or cause to be
delivered to the Seller on the Closing Date, against delivery and release
by the
Seller to the Trustee of all documents required pursuant to the Pooling and
Servicing Agreement, the consideration for the Mortgage Loans as specified
in
Section 3 of this Agreement.
SECTION
9. Closing
Documents.
Without
limiting the generality of Section 8 hereof, the closing shall be subject
to
delivery of each of the following documents:
(a) An
Officers’ Certificate of the Seller, dated the Closing Date, upon which the
Purchaser and DBSI may rely with respect to certain facts regarding the sale
of
the Mortgage Loans by the Seller to the Purchaser;
(b) An
Opinion of Counsel of the Seller, dated the Closing Date and addressed to
the
Purchaser and DBSI;
-18-
(c) Such
opinions of counsel as the Rating Agencies or the Trustee may request in
connection with the sale of the Mortgage Loans by the Seller to the Purchaser
or
the Seller’s execution and delivery of, or performance under, this Agreement;
and
(d) Such
further information, certificates, opinions and documents as the Purchaser
or
DBSI may reasonably request.
SECTION
10. Costs.
The
Seller shall pay (or shall reimburse the Purchaser or any other Person to
the
extent that the Purchaser or such other Person shall pay) all costs and expenses
incurred in connection with the transfer and delivery of the Mortgage Loans,
including without limitation, fees for title policy endorsements and
continuations, the fees and expenses of the Seller’s accountants and attorneys,
the costs and expenses incurred in connection with producing the Servicer’s loan
loss, foreclosure and delinquency experience, and the costs and expenses
incurred in connection with obtaining the documents referred to in Sections
9(a), 9(b) and 9(c), the costs and expenses of printing (or otherwise
reproducing) and delivering this Agreement, the Pooling and Servicing Agreement,
the Certificates, the prospectus and prospectus supplement, and any private
placement memorandum relating to the Certificates and other related documents,
the initial fees, costs and expenses of the Trustee, the fees and expenses
of
the Purchaser’s counsel in connection with the preparation of all documents
relating to the securitization of the Mortgage Loans, the filing fee charged
by
the Securities and Exchange Commission for registration of the Certificates
and
the fees charged by any rating agency to rate the Certificates. All
other costs and expenses in connection with the transactions contemplated
hereunder shall be borne by the party incurring such expense.
SECTION
11. Servicing.
The
Mortgage Loans will be master serviced by the Master Servicer under the Pooling
and Servicing Agreement and serviced by the Servicer under the Pooling and
Servicing Agreement, on behalf of the Trust, and the Seller has represented
to
the Purchaser that such Mortgage Loans are not subject to any other servicing
agreements with third parties. Neither the Purchaser nor any
affiliate of the Purchaser is servicing the Mortgage Loans under any such
servicing agreement and, accordingly, neither the Purchaser nor any affiliate
of
the Purchaser is entitled to receive any fee for releasing the Mortgage Loans
from any such servicing agreement. The Seller shall arrange for the
orderly transfer of such servicing to the Servicer. For so long as
the Master Servicer master services the Mortgage Loans and the Servicer services
the Mortgage Loans, the Master Servicer shall be entitled to the Master
Servicing Fee and the Servicer shall be entitled to its Servicing Fee and
such
other payments as provided for under the terms of the Pooling and Servicing
Agreement, as applicable.
SECTION
12. Mandatory
Delivery; Grant of Security Interest. The
sale and delivery on the Closing Date of the Mortgage Loans (exclusive of
the
Servicing Rights) described on the Closing Schedule in accordance with the
terms
and conditions of this Agreement is mandatory. It is specifically
understood and agreed that each Mortgage Loan is unique and identifiable
on the
date hereof and that an award of money damages would be insufficient to
compensate the Purchaser for the losses and damages incurred by the Purchaser
in
the event of the Seller’s failure to deliver the Mortgage Loans on or before the
Closing Date. The Seller hereby grants to the Purchaser a lien on and
a continuing security interest in the Seller’s interest in each Mortgage Loan
and each document and instrument evidencing each such Mortgage Loan to secure
the performance by the Seller of its obligation hereunder, and the Seller
agrees
that it holds such Mortgage Loans in custody for the Purchaser, subject to
the
Purchaser’s (i) right, prior to the Closing Date, to reject any Mortgage Loan to
the extent permitted by this Agreement and (ii) obligation to deliver or
cause
to be delivered the consideration for the Mortgage Loans pursuant to Section
8
hereof. Any Mortgage Loans rejected by the Purchaser shall
concurrently therewith be released from the security interest created
hereby. All rights and remedies of the Purchaser under this Agreement
are distinct from, and cumulative with, any other rights or remedies under
this
Agreement or afforded by law or equity and all such rights and remedies may
be
exercised concurrently, independently or successively.
-19-
Notwithstanding
the foregoing, if on the Closing Date, each of the conditions set forth in
Section 8 hereof shall have been satisfied and the Purchaser shall not have
paid
or caused to be paid the Purchase Price, or any such condition shall not
have
been waived or satisfied and the Purchaser determines not to pay or cause
to be
paid the Purchase Price, the Purchaser shall immediately effect the redelivery
of the Mortgage Loans, if delivery to the Purchaser has occurred, and the
security interest created by this Section 12 shall be deemed to have been
released.
SECTION
13. Notices. All
demands, notices and communications hereunder shall be in writing and shall
be
deemed to have been duly given if personally delivered to or mailed by
registered mail, postage prepaid, or transmitted by fax and, receipt of which
is
confirmed by telephone, if to the Purchaser, addressed to the Purchaser at
0000
Xxxxxxxx Xxxxxxxxx, Xxxxx 000, Xxxxxxxxx, Xxxxx Xxxxxxxx 00000, fax: (000)
000-0000, Attention: Xxxxx Xxxxx, or such other address as may hereafter
be
furnished to the Seller in writing by the Purchaser; and if to the Seller,
addressed to the Seller at 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, fax:
(000)
000-0000, Attention: Xxxxxxx Xxxxxxxxx, or to such other address as
the Seller may designate in writing to the Purchaser.
SECTION
14. Severability
of Provisions. Any
part, provision, representation or warranty of this Agreement that is prohibited
or that is held to be void or unenforceable shall be ineffective to the extent
of such prohibition or unenforceability without invalidating the remaining
provisions hereof. Any part, provision, representation or warranty of
this Agreement that is prohibited or unenforceable or is held to be void
or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating
the
remaining provisions hereof, and any such prohibition or unenforceability
in any
jurisdiction as to any Mortgage Loan shall not invalidate or render
unenforceable such provision in any other jurisdiction. To the extent
permitted by applicable law, the parties hereto waive any provision of law
which
prohibits or renders void or unenforceable any provision hereof.
SECTION
15. Agreement
of Parties. The
Seller and the Purchaser each agree to execute and deliver such instruments
and
take such actions as either of the others may, from time to time, reasonably
request in order to effectuate the purpose and to carry out the terms of
this
Agreement and the Pooling and Servicing Agreement.
-20-
SECTION
16. Survival. The
Seller agrees that the representations, warranties and agreements made by
it
herein and in any certificate or other instrument delivered pursuant hereto
shall be deemed to be relied upon by the Purchaser, notwithstanding any
investigation heretofore or hereafter made by the Purchaser or on its behalf,
and that the representations, warranties and agreements made by the Seller
herein or in any such certificate or other instrument shall survive the delivery
of and payment for the Mortgage Loans and shall continue in full force and
effect, notwithstanding any restrictive or qualified endorsement on the Mortgage
Notes and notwithstanding subsequent termination of this Agreement, the Pooling
and Servicing Agreement or the Trust Fund.
SECTION
17. GOVERNING
LAW. THIS
AGREEMENT AND THE RIGHTS, DUTIES, OBLIGATIONS AND RESPONSIBILITIES OF THE
PARTIES HERETO SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS
(EXCLUDING THE CHOICE OF LAW PROVISIONS) AND DECISIONS OF THE STATE OF NEW
YORK. THE
PARTIES HERETO INTEND THAT THE PROVISIONS OF SECTION 5-1401 OF THE NEW YORK
GENERAL OBLIGATIONS LAW SHALL APPLY TO THIS AGREEMENT.
SECTION
18. Miscellaneous.
This
Agreement may be executed in two or more counterparts, each of which when
so
executed and delivered shall be an original, but all of which together shall
constitute one and the same instrument. This Agreement shall inure to
the benefit of and be binding upon the parties hereto and their respective
successors and assigns. This Agreement supersedes all prior
agreements and understandings relating to the subject matter
hereof. Neither this Agreement nor any term hereof may be changed,
waived, discharged or terminated orally, but only by an instrument in writing
signed by the party against whom enforcement of the change, waiver, discharge
or
termination is sought. The headings in this Agreement are for
purposes of reference only and shall not limit or otherwise affect the meaning
hereof.
It
is the
express intent of the parties hereto that the conveyance of the Mortgage
Loans
and the Cap Agreements by the Seller to the Purchaser as provided in Section
4
hereof be, and be construed as, a sale of the Mortgage Loans and the Cap
Agreements by the Seller to the Purchaser and not as a pledge of the Mortgage
Loans and the Cap Agreements by the Seller to the Purchaser to secure a
debt or
other obligation of the Seller. However, in the event that, notwithstanding
the
aforementioned intent of the parties, the Mortgage Loans and the Cap Agreements
are held to be property of the Seller, then (a) it is the express intent
of the
parties that such conveyance be deemed a pledge of the Mortgage Loans and
the
Cap Agreements by the Seller to the Purchaser to secure a debt or other
obligation of the Seller and (b) (1) this Agreement shall also be deemed
to be a
security agreement within the meaning of Articles 8 and 9 of the New York
Uniform Commercial Code; (2) the conveyance provided for in Section 4 hereof
shall be deemed to be a grant by the Seller to the Purchaser of a security
interest in all of the Seller’s right, title and interest in and to the Mortgage
Loans and the Cap Agreements and all amounts payable to the holders of
the
Mortgage Loans and the Cap Agreements in accordance with the terms thereof
and
all proceeds of the conversion, voluntary or involuntary, of the foregoing
into
cash, instruments, securities or other property, including without limitation
all amounts, other than investment earnings, from time to time held or
invested
in the Collection Account whether in the form of cash, instruments, securities
or other property; (3) the possession by the Purchaser or its agent of
Mortgage
Notes, the related Mortgages and such other items of property that constitute
instruments, money, negotiable documents or chattel paper shall be deemed
to be
“possession by the secured party” for purposes of perfecting the security
interest pursuant to Section 9-305 of the New York Uniform Commercial Code;
and
(4) notifications to persons holding such property and acknowledgments,
receipts
or confirmations from persons holding such property shall be deemed
notifications to, or acknowledgments, receipts or confirmations from, financial
intermediaries, bailees or agents (as applicable) of the Purchaser for
the
purpose of perfecting such security interest under applicable law. Any
assignment of the interest of the Purchaser pursuant to Section 4(d) hereof
shall also be deemed to be an assignment of any security interest created
hereby. The Seller and the Purchaser shall, to the extent consistent with
this
Agreement, take such actions as may be necessary to ensure that, if this
Agreement were deemed to create a security interest in the Mortgage Loans
and
the Cap Agreements, such security interest would be deemed to be a perfected
security interest of first priority under applicable law and will be maintained
as such throughout the term of this Agreement and the Pooling and Servicing
Agreement.
-21-
SECTION
19. Third
Party Beneficiary. The
parties hereto acknowledge and agree that DBSI and each of its respective
successors and assigns shall have all the rights of a third-party beneficiary
in
respect of Section 12 of this Agreement and shall be entitled to rely upon
and
directly enforce the provisions of Section 12 of this
Agreement.
-22-
IN
WITNESS WHEREOF, the Purchaser and the Seller have caused their names to
be
signed by their respective officers thereunto duly authorized as of the date
first above written.
DB
STRUCTURED PRODUCTS, INC.
By:
/s/:
Xxxxx Xxxxxxxxx
Name:
Xxxxx Xxxxxxxxx
Title:
Director
By:
/s/:
Xxxxx Xxxxxxx
Name:
Xxxxx Xxxxxxx
Title:
Director
ACE
SECURITIES CORP.
By:
/s/:
Xxxxxx Xxxxxxxxxx
Name:
Xxxxxx Xxxxxxxxxx
Title:
Vice President
By:
/s/:
Xxxxx X. Xxxxx
Name:
Xxxxx X. Xxxxx
Title:
Vice President
EXHIBIT
1
Loan
#:
_______
Borrower:
_____
LOST
NOTE
AFFIDAVIT
I,
as
_____________________ of ____________________, a _______________ am authorized
to make this Affidavit on behalf of __________________ (the “Seller”). In
connection with the administration of the Mortgage Loans held by
______________________, a _______________ [corporation] as Seller on behalf
of
____________________ (the “Purchaser”), _______________________ (the
“Deponent”), being duly sworn, deposes and says that:
1. The
Seller’s address is: _____________________
__________________
__________________
2. The
Seller previously delivered to the Purchaser a signed Initial Certification
with
respect to such Mortgage and/or Assignment of Mortgage;
3. Such
Mortgage Note and/or Assignment of Mortgage was assigned or sold to the
Purchaser by __________________, a pursuant
to the
terms and provisions of a Mortgage Loan Purchase Agreement dated as of
_____________;
4. Such
Mortgage Note and/or Assignment of Mortgage is not outstanding pursuant to
a
request for release of Documents;
5. Aforesaid
Mortgage Note and/or Assignment of Mortgage (the “Original”) has been
lost;
6. Deponent
has made or caused to be made a diligent search for the Original and has
been
unable to find or recover same;
7. The
Seller was the Seller of the Original at the time of the loss; and
8. Deponent
agrees that, if said Original should ever come into Seller’s possession, custody
or power, Seller will immediately and without consideration surrender the
Original to the Purchaser.
9. Attached
hereto is a true and correct copy of (i) the Note, endorsed in blank by the
Mortgagee and (ii) the Mortgage or Deed of Trust (strike one) which secures
the
Note, which Mortgage or Deed of Trust is recorded in the county where the
property is located.
10. Deponent
hereby agrees that the Seller (a) shall indemnify and hold harmless the
Purchaser, its successors and assigns, against any loss, liability or damage,
including reasonable attorney’s fees, resulting from the unavailability of any
Notes, including but not limited to any loss, liability or damage arising
from
(i) any false statement contained in this Affidavit, (ii) any claim of any
party
that purchased a mortgage loan evidenced by the Lost Note or any interest
in
such mortgage loan, (iii) any claim of any borrower with respect to the
existence of terms of a mortgage loan evidenced by the Lost Note on the related
property to the fact that the mortgage loan is not evidenced by an original
note
and (iv) the issuance of a new instrument in lieu thereof (items (i) through
(iv) above hereinafter referred to as the “Losses”) and (b) if required by any
Rating Agency in connection with placing such Lost Note into a Pass-Through
Transfer, shall obtain a surety from an insurer acceptable to the applicable
Rating Agency to cover any Losses with respect to such Lost Note.
11. This
Affidavit is intended to be relied upon by the Purchaser, its successors
and
assigns. Seller represents and warrants that is has the authority to perform
its
obligations under this Affidavit of Lost Note.
Executed
this _ day of _______, 200_.
________________________
By:
_____________________
Name:
Title:
On
this
__ day of ______, 200_, before me appeared ______________________ to me
personally known, who being duly sworn did say that he is the
_______________________ of ____________________, a ______________________
and
that said Affidavit of Lost Note was signed and sealed on behalf of such
corporation and said acknowledged this instrument to be the free act and
deed of
said entity.
Signature:
[Seal]
EXHIBIT
0
XXXXXXXX
X — Standard & Poor’s Predatory Lending Categories
Standard
& Poor’s has categorized loans governed by anti-predatory lending laws in
the Jurisdictions listed below into three categories based upon a combination
of
factors that include (a) the risk exposure associated with the assignee
liability and (b) the tests and thresholds set forth in those laws. Note
that
certain loans classified by the relevant statute as Covered are included
in
Standard & Poor’s High Cost Loan Category because they included thresholds
and tests that are typical of what is generally considered High Cost by the
industry.
Standard
& Poor’s High Cost Loan Categorization
|
State/Jurisdiction
|
Name
of Anti-Predatory Lending Law/Effective Date
|
Category
under Applicable Anti-Predatory Lending Law
|
|
Arkansas
|
Home
Loan Protection Act, Ark.
Code
Xxx. §§ 00-00-000 et
seq.
Effective
July 16, 2003
|
High
Cost Home Loan
|
|
Cleveland
Heights, OH
|
Ordinance
No. 72-2003 (PSH), Mun. Code §§ 757.01 et
seq.
Effective
June 2, 2003
|
Covered
Loan
|
|
Colorado
|
Consumer
Equity Protection, Colo. Stat. Xxx. §§ 5-3.5-101 et
seq.
Effective
for covered loans offered or entered into on or after January
1, 2003.
Other provisions of the Act took effect on June 7, 2002
|
Covered
Loan
|
|
Connecticut
|
Connecticut
Abusive Home Loan Lending Practices Act, Conn. Gen. Stat. §§36a-746
et
seq.
Effective
October 1, 2001
|
High
Cost Home Loan
|
|
District
of Columbia
|
Home
Loan Protection Act, D.C. Code §§ 26-1151.01 et
seq.
Effective
for loans closed on or after January 28, 2003
|
Covered
Loan
|
|
Florida
|
Fair
Lending Act, Fla. Stat. Xxx. §§ 494.0078 et
seq.
Effective
October 2, 2002
|
High
Cost Home Loan
|
Standard
& Poor’s High Cost Loan Categorization
|
State/Jurisdiction
|
Name
of Anti-Predatory Lending Law/Effective Date
|
Category
under Applicable Anti-Predatory Lending Law
|
|
Georgia
(Oct. 1, 2002 - Mar. 6, 2003)
|
Fair
Lending Act, Ga. Code Xxx. §§ 7-6A-1 et
seq.
Effective
October 1, 2002 - March 6, 2003
|
High
Cost Home Loan
|
|
Georgia
as amended (Mar. 7, 2003 - current)
|
Georgia
Fair Lending Act, Ga. Code Xxx. §§ 7-6A-1 et
seq.
Effective
for loans closed on or after March 7, 2003
|
High
Cost Home Loan
|
|
HOEPA
Section 32
|
Home
Ownership and Equity Protection Act of 1994, 15 U.S.C. § 1639, 12 C.F.R.
§§ 226.32 and 226.34
Effective
October 1, 1995, amendments October 1, 2002
|
High
Cost Loan
|
|
Illinois
|
High
Risk Home Loan Act, Ill. Comp. Stat. tit. 815, §§ 137/5 et
seq.
Effective
January 1, 2004 (prior to this date, regulations under Residential
Mortgage License Act effective from May 14, 2001)
|
High
Risk Home Loan
|
|
Kansas
|
Consumer
Credit Code, Kan. Stat. Xxx. §§ 16a-1-101 et
seq.
Section
16a-1-301 and 16a-3-207 became effective April 14, 1999; Section
16a-3-308a became effective July 1, 1999
|
High
Loan to Value Consumer Loan (id. § 16a-3-207) and;
|
|
High
APR Consumer Loan (id. §16a-3-308a)
|
||
|
Kentucky
|
2003
KY H.B. 000 - Xxxx Xxxx Xxxx Xxxx Xxx, Xx. Rev. Stat §§360.100
et
seq.
Effective
June 24, 2003
|
High
Cost Home Loan
|
|
Maine
|
Truth
in Lending, Me. Rev. Stat. tit. 9-A, §§ 8-101 et
seq.
Effective
September 29, 1995 and as amended from time to time
|
High
Rate High Fee Mortgage
|
Standard
& Poor’s High Cost Loan Categorization
|
State/Jurisdiction
|
Name
of Anti-Predatory Lending Law/Effective Date
|
Category
under Applicable Anti-Predatory Lending
Law
|
|
Massachusetts
|
Part
40 and Part 32, 209 C.M.R. §§ 32.00 et
seq.
and 209 C.M.R. §§ 40.01 et
seq.
Effective
March 22, 2001 and amended from time to time
|
High
Cost Home Loan
|
|
Nevada
|
Assembly
Xxxx Xx. 000, Xxx. Xxx. Xxxx §§ 000X.000 et
seq.
Effective
October 1, 2003
|
Home
Loan
|
|
New
Jersey
|
New
Jersey Home Ownership Security Act of 2002, N.J. Rev. Stat. §§ 46:10B-22
et
seq.
Effective
for loans closed on or after November 27, 2003
|
High
Cost Home Loan
|
|
New
Mexico
|
Home
Loan Protection Act, N.M. Rev. Stat. §§ 58-21A-1 et
seq.
Effective
as of January 1, 2004; Revised as of February 26, 2004
|
High
Cost Home Loan
|
|
New
York
|
N.Y.
Banking Law Article 6-1
Effective
for applications made on or after April 1, 2003
|
High
Cost Home Loan
|
|
North
Carolina
|
Restrictions
and Limitations on High Cost Home Loans, N.C. Gen. Stat. §§ 24-1.1E
et
seq.
Effective
July 1, 2000; amended October 1, 2003 (adding open-end lines
of
credit)
|
High
Cost Home Loan
|
|
Ohio
|
H.B.
386 (codified in various sections of the Ohio Code), Ohio Rev.
Code Xxx.
§§ 1349.25 et
seq.
Effective
May 24, 2002
|
Covered
Loan
|
|
Oklahoma
|
Consumer
Credit Code (codified in various sections of Title 14A)
Effective
July 1, 2000; amended effective January 1, 2004
|
Subsection
10 Mortgage
|
Standard
& Poor’s High Cost Loan Categorization
|
State/Jurisdiction
|
Name
of Anti-Predatory Lending Law/Effective Date
|
Category
under Applicable Anti-Predatory Lending
Law
|
|
South
Carolina
|
South
Carolina High Cost and Consumer Home Loans Act, S.C. Code Xxx.
§§ 37-23-10
et
seq.
Effective
for loans taken on or after January 1, 2004
|
High
Cost Home Loan
|
|
West
Virginia
|
West
Virginia Residential Mortgage Lender, Broker and Servicer Act,
W. Va. Code
Xxx. §§ 31-17-1 et
seq.
Effective
June 5, 0000
|
Xxxx
Xxxxxxxx Mortgage Loan Act
Loan
|
Standard
& Poor’s Covered Loan Categorization
|
State/Jurisdiction
|
Name
of Anti-Predatory Lending Law/Effective Date
|
Category
under Applicable Anti-Predatory Lending Law
|
|
Georgia
(Oct. 1, 2002 - Mar. 6, 2003)
|
Xxxxxxx
Xxxx Lending Act, Ga. Code Xxx. §§ 7-6A-1 et
seq.
Effective
October 1, 2002 - March 6, 2003
|
Covered
Loan
|
|
New
Jersey
|
New
Jersey Home Ownership Security Act of 2002, N.J. Rev. Stat §§ 46:10B-22
et
seq.
Effective
November 27, 2003 - July 5, 2004
|
Covered
Home Loan
|
Standard
& Poor’s Home Loan Categorization
|
State/Jurisdiction
|
Name
of Anti-Predatory Lending Law/Effective Date
|
Category
under Applicable Anti-Predatory Lending Law
|
|
Georgia
(Oct. 1, 2002 - Mar. 6, 2003)
|
Xxxxxxx
Xxxx Lending Act, Ga. Code Xxx. §§ 7-6A-1 et
seq.
Effective
October 1, 2002 - March 6, 2003
|
Home
Loan
|
|
New
Jersey
|
New
Jersey Home Ownership Security Act of 2002, N.J. Rev. Stat §§ 46:10B-22
et
seq.
Effective
for loans closed on or after November 27, 2003
|
Home
Loan
|
|
New
Mexico
|
Home
Loan Protection Act, N.M. Rev. Stat. §§ 58-21A-1 et
seq.
Effective
as of January 1, 2004; Revised as of February 26, 2004
|
Home
Loan
|
Standard
& Poor’s Home Loan Categorization
|
State/Jurisdiction
|
Name
of Anti-Predatory Lending Law/Effective Date
|
Category
under Applicable Anti-Predatory Lending
Law
|
|
North
Carolina
|
Restrictions
and Limitations on High Cost Home Loans, N.C. Gen. Stat. §§ 24-1.1E
et
seq.
Effective
July 1, 2000; amended October 1, 2003 (adding open-end lines
of
credit)
|
Consumer
Home Loan
|
|
South
Carolina
|
South
Carolina High Cost and Consumer Home Loans Act, S.C. Code Xxx.
§§ 37-23-10
et
seq.
Effective
for loans taken on or after January 1, 2004
|
Consumer
Home Loan
|
EXHIBIT
G
FORM
10-D, FORM 8-K AND FORM 10-K
REPORTING
RESPONSIBILITY
As
to
each item described below, the entity indicated as the Responsible Party shall
be primarily responsible for reporting the information to the party identified
as responsible for preparing the Securities Exchange Act Reports pursuant to
Section 5.06(a)(ii).
Under
Item 1 of Form 10-D: a) items marked “monthly statement” are required to be
included in the periodic Distribution Date statement under Section 5.02,
provided by the Securities Administrator based on information received from
the
Master Servicer; and b) items marked “Form 10-D report” are required to be in
the Form 10-D report but not the monthly statement, provided by the party
indicated. Information under all other Items of Form 10-D is to be included
in
the Form 10-D report.
|
Form
|
Item
|
Description
|
Servicer
|
Master
Servicer
|
Securities
Administrator
|
Custodian
|
Trustee
|
Depositor
|
Sponsor
|
|
10-D
|
Must
be filed within 15 days of the distribution date for the asset-backed
securities.
|
||||||||
|
1
|
Distribution
and Pool Performance Information
|
||||||||
|
Item
1121(a) - Distribution and Pool Performance
Information
|
|||||||||
|
(1)
Any applicable record dates, accrual dates, determination dates
for
calculating distributions and actual distribution dates for the
distribution period.
|
X
(monthly
Statement)
|
||||||||
|
(2)
Cash flows received and the sources thereof for distributions,
fees and
expenses.
|
X
(monthly
Statement)
|
||||||||
|
(3)
Calculated amounts and distribution of the flow of funds for the
period
itemized by type and priority of payment, including:
|
X
(monthly
Statement)
|
||||||||
G-1
|
Form
|
Item
|
Description
|
Servicer
|
Master
Servicer
|
Securities
Administrator
|
Custodian
|
Trustee
|
Depositor
|
Sponsor
|
|
(i)
Fees or expenses accrued and paid, with an identification of the
general
purpose of such fees and the party receiving such fees or
expenses.
|
X
(monthly
Statement)
|
||||||||
|
(ii)
Payments accrued or paid with respect to enhancement or other support
identified in Item 1114 of Regulation AB (such as insurance premiums
or
other enhancement maintenance fees), with an identification of
the general
purpose of such payments and the party receiving such
payments.
|
X
(monthly
Statement)
|
||||||||
|
(iii)
Principal, interest and other distributions accrued and paid on
the
asset-backed securities by type and by class or series and any
principal
or interest shortfalls or carryovers.
|
X
(monthly
Statement)
|
||||||||
|
(iv)
The amount of excess cash flow or excess spread and the disposition
of
excess cash flow.
|
X
(monthly
Statement)
|
||||||||
|
(4)
Beginning and ending principal balances of the asset-backed
securities.
|
X
(monthly
Statement)
|
G-2
|
Form
|
Item
|
Description
|
Servicer
|
Master
Servicer
|
Securities
Administrator
|
Custodian
|
Trustee
|
Depositor
|
Sponsor
|
|
(5)
Interest rates applicable to the pool assets and the asset-backed
securities, as applicable. Consider providing interest rate information
for pool assets in appropriate distributional groups or incremental
ranges.
|
|
|
X
(monthly
Statement)
|
|
|
|
|
||
|
(6)
Beginning and ending balances of transaction accounts, such as
reserve
accounts, and material account activity during the period.
|
|
|
X
(monthly
Statement)
|
|
|
|
|
||
|
(7)
Any amounts drawn on any credit enhancement or other support identified
in
Item 1114 of Regulation AB, as applicable, and the amount of coverage
remaining under any such enhancement, if known and
applicable.
|
|
|
X
(monthly
Statement)
|
|
|
|
|
||
|
(8)
Number and amount of pool assets at the beginning and ending of
each
period, and updated pool composition information, such as weighted
average
coupon, weighted average remaining term, pool factors and prepayment
amounts.
|
|
|
X
(monthly
Statement)
|
|
|
Updated
pool composition information fields to be as specified by Depositor
from
time to time
|
|
||
|
(9)
Delinquency and loss information for the period.
|
X
|
X
|
X
(monthly
Statement)
|
|
|
|
|
||
|
In
addition, describe any material changes to the information specified
in
Item 1100(b)(5) of Regulation AB regarding the pool assets.
(methodology)
|
X
|
X
|
|
|
|
|
G-3
|
Form
|
Item
|
Description
|
Servicer
|
Master
Servicer
|
Securities
Administrator
|
Custodian
|
Trustee
|
Depositor
|
Sponsor
|
|
(10)
Information on the amount, terms and general purpose of any advances
made
or reimbursed during the period, including the general use of funds
advanced and the general source of funds for
reimbursements.
|
X
|
X
|
X
(monthly
Statement)
|
||||||
|
(11)
Any material modifications, extensions or waivers to pool asset
terms,
fees, penalties or payments during the distribution period or that
have
cumulatively become material over time.
|
X
|
X
|
X
(monthly
Statement)
|
||||||
|
(12)
Material breaches of pool asset representations or warranties or
transaction covenants.
|
X
|
X
|
X
|
||||||
|
(13)
Information on ratio, coverage or other tests used for determining
any
early amortization, liquidation or other performance trigger and
whether
the trigger was met.
|
X
(monthly
Statement)
|
||||||||
|
(14)
Information regarding any new issuance of asset-backed securities
backed
by the same asset pool,
|
|||||||||
|
any
pool asset changes (other than in connection with a pool asset
converting
into cash in accordance with its terms), such as additions or removals
in
connection with a prefunding or revolving period and pool asset
substitutions and repurchases (and purchase rates, if applicable),
and
cash flows available for future purchases, such as the balances
of any
prefunding or revolving accounts, if applicable.
|
X
|
X
|
X
|
X
|
G-4
|
Form
|
Item
|
Description
|
Servicer
|
Master
Servicer
|
Securities
Administrator
|
Custodian
|
Trustee
|
Depositor
|
Sponsor
|
|
Disclose
any material changes in the solicitation, credit-granting, underwriting,
origination, acquisition or pool selection criteria or procedures,
as
applicable, used to originate, acquire or select the new pool
assets.
|
X
|
X
|
|||||||
|
Item
1121(b) - Pre-Funding or Revolving Period Information
Updated
pool information as required under Item 1121(b).
|
X
|
||||||||
|
2
|
Legal
Proceedings
|
||||||||
|
Item
1117 - Legal proceedings pending against the following entities,
or their
respective property, that is material to Certificateholders, including
proceedings known to be contemplated by governmental
authorities:
|
|||||||||
|
Sponsor
(Seller)
|
X
|
||||||||
|
Depositor
|
X
|
||||||||
|
Trustee
|
X
|
||||||||
|
Issuing
entity
|
X
|
||||||||
|
Master
Servicer, affiliated Servicer, other Servicer servicing 20% or
more of
pool assets at time of report, other material servicers
|
X
|
X
|
|||||||
|
Securities
Administrator
|
X
|
G-5
|
Form
|
Item
|
Description
|
Servicer
|
Master
Servicer
|
Securities
Administrator
|
Custodian
|
Trustee
|
Depositor
|
Sponsor
|
|
Originator
of 20% or more of pool assets as of the Cut-off Date
|
X
|
||||||||
|
Custodian
|
X
|
||||||||
|
3
|
Sales
of Securities and Use of Proceeds
|
||||||||
|
Information
from Item 2(a) of Part II of Form 10-Q:
With
respect to any sale of securities by the sponsor, depositor or
issuing
entity, that are backed by the same asset pool or are otherwise
issued by
the issuing entity, whether or not registered, provide the sales
and use
of proceeds information in Item 701 of Regulation S-K. Pricing
information
can be omitted if securities were not registered.
|
X
|
||||||||
|
4
|
Defaults
Upon Senior Securities
|
||||||||
|
Information
from Item 3 of Part II of Form 10-Q:
Report
the occurrence of any Event of Default (after expiration of any
grace
period and provision of any required notice)
|
X
|
X
|
|||||||
|
5
|
Submission
of Matters to a Vote of Security Holders
|
||||||||
|
Information
from Item 4 of Part II of Form 10-Q
|
X
|
X
|
|||||||
|
6
|
Significant
Obligors of Pool Assets
|
G-6
|
Form
|
Item
|
Description
|
Servicer
|
Master
Servicer
|
Securities
Administrator
|
Custodian
|
Trustee
|
Depositor
|
Sponsor
|
|
Item
1112(b) - Significant
Obligor Financial Information*
|
|
|
|
|
|
X
|
X
|
||
|
*This
information need only be reported on the Form 10-D for the distribution
period in which updated information is required pursuant to the
Item.
|
|
|
|
|
|
|
|
||
|
7
|
Significant
Enhancement Provider Information
|
|
|
|
|
|
|
|
|
|
Item
1114(b)(2) - Credit Enhancement Provider Financial
Information*
|
|
|
|
|
|
|
|
||
|
Determining
applicable disclosure threshold
|
|
|
X
|
|
|
|
|
||
|
Requesting
required financial information or effecting incorporation by
reference
|
|
|
X
|
|
|
|
|
||
|
Item
1115(b) - Derivative Counterparty Financial
Information*
|
|
|
|
|
|
|
|
||
|
Determining
current maximum probable exposure
|
|
|
|
|
|
X
|
|
||
|
Determining
current significance percentage
|
|
|
X
|
|
|
|
|
||
|
Requesting
required financial information or effecting incorporation by
reference
|
|
|
X
|
|
|
|
|
||
|
*This
information need only be reported on the Form 10-D for the distribution
period in which updated information is required pursuant to the
Items.
|
|
|
|
|
|
|
|
||
|
8
|
Other
Information
|
|
|
|
|
|
|
|
|
|
Disclose
any information required to be reported on Form 8-K during the
period
covered by the Form 10-D but not reported
|
The
Responsible Party for the applicable Form 8-K item as indicated
below.
|
||||||||
G-7
|
Form
|
Item
|
Description
|
Servicer
|
Master
Servicer
|
Securities
Administrator
|
Custodian
|
Trustee
|
Depositor
|
Sponsor
|
|
9
|
Exhibits
|
||||||||
|
Distribution
report
|
X
|
||||||||
|
Exhibits
required by Item 601 of Regulation S-K, such as material
agreements
|
X
|
||||||||
|
8-K
|
Must
be filed within four business days of an event reportable on Form
8-K.
|
||||||||
|
1.01
|
Entry
into a Material Definitive Agreement
|
||||||||
|
Disclosure
is required regarding entry into or amendment of any definitive
agreement
that is material to the securitization, even if depositor is not
a party.
Examples:
servicing agreement, custodial agreement.
Note:
disclosure not required as to definitive agreements that are fully
disclosed in the prospectus
|
X
|
X
|
X
(if Master Servicer is not a party)
|
X
(if Master Servicer is not a party)
|
X
(if Master Servicer is not a party)
|
X
(if Master Servicer is not a party)
|
|||
|
1.02
|
Termination
of a Material Definitive Agreement
|
X
|
X
|
X
(if Master Servicer is not a party)
|
X
(if Master Servicer is not a party)
|
X
(if Master Servicer is not a party)
|
X
(if Master Servicer is not a party)
|
||
G-8
|
Form
|
Item
|
Description
|
Servicer
|
Master
Servicer
|
Securities
Administrator
|
Custodian
|
Trustee
|
Depositor
|
Sponsor
|
|
Disclosure
is required regarding termination of any definitive agreement that
is
material to the securitization (other than expiration in accordance
with
its terms), even if depositor is not a party.
Examples:
servicing agreement, custodial agreement.
|
|||||||||
|
1.03
|
Bankruptcy
or Receivership
|
||||||||
|
Disclosure
is required regarding the bankruptcy or receivership, if known
to the
Master Servicer, with respect to any of the following:
Sponsor
(Seller), Depositor, Master Servicer, affiliated Servicer, other
Servicer
servicing 20% or more of pool assets at time of report, other material
servicers, Certificate Administrator, Trustee, significant obligor,
credit
enhancer (10% or more), derivatives counterparty,
Custodian
|
X
|
X
|
X
|
X
|
X
|
X
|
X
|
||
|
2.04
|
Triggering
Events that Accelerate or Increase a Direct Financial Obligation
or an
Obligation under an Off-Balance Sheet Arrangement
|
||||||||
|
Includes
an early amortization, performance trigger or other event, including
event
of default, that would materially alter the payment priority/distribution
of cash flows/amortization schedule.
|
X
|
X
|
G-9
|
Form
|
Item
|
Description
|
Servicer
|
Master
Servicer
|
Securities
Administrator
|
Custodian
|
Trustee
|
Depositor
|
Sponsor
|
|
Disclosure
will be made of events other than waterfall triggers which are
disclosed
in the 5.02 statement
|
|
|
|
|
|
|
|
||
|
3.03
|
Material
Modification to Rights of Security Holders
|
|
|
|
|
|
|
|
|
|
Disclosure
is required of any material modification to documents defining
the rights
of Certificateholders, including the Pooling and Servicing
Agreement
|
|
X
|
X
|
|
X
|
X
|
|
||
|
5.03
|
Amendments
to Articles of Incorporation or Bylaws; Change in Fiscal
Year
|
|
|
|
|
|
|
|
|
|
Disclosure
is required of any amendment “to the governing documents of the issuing
entity”
|
|
|
|
|
X
|
X
|
|
||
|
5.06
|
Change
in Shell Company Status
|
|
|
|
|
|
|
|
|
|
[Not
applicable to ABS issuers]
|
|
|
|
|
|
X
|
|
||
|
6.01
|
ABS
Informational and Computational Material
|
|
|
|
|
|
|
|
|
|
[Not
included in reports to be filed under Section 3.18]
|
|
|
|
|
|
X
|
|
||
|
6.02
|
Change
of Servicer or Trustee
|
|
|
|
|
|
|
|
|
|
Requires
disclosure of any removal, replacement, substitution or addition
of any
master servicer, affiliated servicer, other servicer servicing
10% or more
of pool assets at time of report, other material servicers, certificate
administrator or trustee.
|
X
|
X
|
X
|
|
X
|
X
|
|
||
|
Reg
AB disclosure about any new servicer (from entity appointing new
servicer)
or trustee (from Depositor) is also required.
|
X
|
X
|
X
|
G-10
|
Form
|
Item
|
Description
|
Servicer
|
Master
Servicer
|
Securities
Administrator
|
Custodian
|
Trustee
|
Depositor
|
Sponsor
|
|
6.03
|
Change
in Credit Enhancement or Other External Support
|
|
|
|
|
|
|
|
|
|
Covers
termination of any enhancement in manner other than by its terms,
the
addition of an enhancement, or a material change in the enhancement
provided. Applies to external credit enhancements as well as derivatives.
|
|
|
X
|
|
X
|
X
|
|
||
|
Reg
AB disclosure about any new enhancement provider is also
required
|
|
|
|
|
|
X
|
|
||
|
6.04
|
Failure
to Make a Required Distribution
|
|
|
X
|
|
X
|
|
|
|
|
6.05
|
Securities
Act Updating Disclosure
|
|
|
|
|
|
|
|
|
|
If
any material pool characteristic differs by 5% or more at the time
of
issuance of the securities from the description in the final prospectus,
provide updated Reg AB disclosure about the actual asset
pool.
|
|
|
|
|
|
X
|
|
||
|
If
there are any new servicers or originators required to be disclosed
under
Regulation AB as a result of the foregoing, provide the information
called
for in Items 1108 and 1110 respectively.
|
|
|
|
|
|
X
|
|
||
|
7.01
|
Regulation
FD Disclosure
|
X
|
X
|
X
|
|
X
|
X
|
X
|
|
|
8.01
|
Other
Events
|
|
G-11
|
Form
|
Item
|
Description
|
Servicer
|
Master
Servicer
|
Securities
Administrator
|
Custodian
|
Trustee
|
Depositor
|
Sponsor
|
|
Any
event, with respect to which information is not otherwise called
for in
Form 8-K, that the registrant deems of importance to security
holders.
|
|
|
|
|
|
X
|
|
||
|
9.01
|
Financial
Statements and Exhibits
|
The
Responsible Party applicable to reportable event.
|
|||||||
|
10-K
|
Must
be filed within 90 days of the fiscal year end for the
registrant.
|
|
|
|
|
||||
|
|
9B
|
Other
Information
|
|
|
|
|
|
|
|
|
Disclose
any information required to be reported on Form 8-K during the
fourth
quarter covered by the Form 10-K but not reported
|
The
Responsible Party for the applicable Form 8-K as indicated
above.
|
||||||||
|
15
|
Exhibits
and Financial Statement Schedules
|
|
|
|
|
|
|
|
|
|
Item
1112(b) - Significant
Obligor Financial Information
|
|
|
|
|
|
X
|
X
|
||
|
Item
1114(b)(2) - Credit Enhancement Provider Financial
Information
|
|
|
|
|
|
|
|
||
|
Determining
applicable disclosure threshold
|
|
|
X
|
|
|
|
|
||
|
Requesting
required financial information or effecting incorporation by
reference
|
|
|
X
|
|
|
|
|
||
|
Item
1115(b) - Derivative Counterparty Financial
Information
|
|
|
|
|
|
|
|
||
|
Determining
current maximum probable exposure
|
|
|
|
|
|
X
|
|
||
|
Determining
current significance percentage
|
|
|
X
|
|
|
|
|
||
|
Requesting
required financial information or effecting incorporation by
reference
|
|
|
X
|
|
|
|
|
||
|
Item
1117 - Legal proceedings pending against the following entities,
or their
respective property, that is material to Certificateholders, including
proceedings known to be contemplated by governmental
authorities:
|
|
||||||||
G-12
|
Form
|
Item
|
Description
|
Servicer
|
Master
Servicer
|
Securities
Administrator
|
Custodian
|
Trustee
|
Depositor
|
Sponsor
|
|
Sponsor
(Seller)
|
|
|
|
|
|
|
X
|
||
|
Depositor
|
|
|
|
|
|
X
|
|
||
|
Trustee
|
|
|
|
|
X
|
|
|
||
|
Issuing
entity
|
|
|
|
|
|
X
|
|
||
|
Master
Servicer, affiliated Servicer, other Servicer servicing 20% or
more of
pool assets at time of report, other material servicers
|
X
|
X
|
|
|
|
|
|
||
|
Securities
Administrator
|
|
|
X
|
|
|
|
|
||
|
Originator
of 20% or more of pool assets as of the Cut-off Date
|
|
|
|
|
|
X
|
X
|
||
|
Custodian
|
|
|
|
X
|
|
|
|
||
|
Item
1119 - Affiliations and relationships between the following entities,
or
their respective affiliates, that are material to
Certificateholders:
|
|
|
|
|
|
|
|
||
|
Sponsor
(Seller)
|
|
|
|
|
|
|
X
|
||
|
Depositor
|
|
|
|
|
|
X
|
|
||
|
Trustee
|
|
|
|
|
X
(with respect to 1119(a) affiliations only)
|
|
|
||
|
Master
Servicer, affiliated Servicer, other Servicer servicing 20% or
more of
pool assets at time of report, other material servicers
|
X
|
X
|
|
|
|
|
|
G-13
|
Form
|
Item
|
Description
|
Servicer
|
Master
Servicer
|
Securities
Administrator
|
Custodian
|
Trustee
|
Depositor
|
Sponsor
|
|
|
|
Securities
Administrator
|
|
|
X
|
|
|
|
|
|
Originator
|
|
|
|
|
|
X
|
X
|
||
|
Custodian
|
|
|
|
X
(with respect to affiliations only)
|
|
|
|
||
|
Credit
Enhancer/Support Provider
|
|
|
|
|
|
X
|
X
|
||
|
Significant
Obligor
|
|
|
|
|
|
X
|
X
|
||
|
Item
1122 - Assessment of Compliance with Servicing
Criteria
|
X
|
X
|
X
|
X
|
|||||
|
Item
1123 - Servicer Compliance Statement
|
X
|
X
|
G-14
EXHIBIT
H
ADDITIONAL
DISCLOSURE NOTIFICATION
**SEND
VIA FAX TO [XXX-XXX-XXXX] AND VIA EMAIL TO [_________________] AND VIA OVERNIGHT
MAIL TO THE ADDRESS IMMEDIATELY BELOW:
Xxxxx
Fargo Bank, N.A. as Securities Administrator
0000
Xxx
Xxxxxxxxx Xxxx
Xxxxxxxx,
Xxxxxxxx 00000
Fax:
(000) 000-0000
E-mail:
xxx.xxx.xxxxxxxxxxxxx@xxxxxxxxxx.xxx
Attn:
Corporate Trust Services - ACE 2007-WM2 - SEC REPORT PROCESSING
ACE
Securities Corp.
0000
Xxxxxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxxxx,
Xxxxx Xxxxxxxx 00000
Attention:
Xxxxxxx Xxxxxxx
Fax:
(000) 000-0000)
Attn:
ACE
2007-WM2
RE:
**
Additional Form [10-D][10-K][8-K] Disclosure** Required
Ladies
and Gentlemen:
In
accordance with Section [__] of the Pooling and Servicing Agreement, dated
as of March 1, 2007 (the “Pooling and Servicing Agreement”), among ACE
Securities Corp., as depositor, Ocwen Loan Servicing, LLC, as servicer, Xxxxx
Fargo Bank, National Association , as master servicer and securities
administrator and HSBC Bank USA, National Association, as trustee, the
undersigned, as [______], hereby notifies you that certain events have come
to
our attention that [will] [may] need to be disclosed on Form
[10-D][10-K][8-K].
Description
of Additional Form [10-D][10-K][8-K] Disclosure:
List
of any Attachments hereto to be included in the Additional Form
[10-D][10-K][8-K] Disclosure:
Any
inquiries related to this notification should be directed to [_____________],
phone number: [______]; email address: [_________________].
H-1
[NAME
OF
PARTY]
As
[role]
By:
_____________________
Name:
Title:
H-2
EXHIBIT
I
SWAP
AGREEMENT
I-1
 Deutsche
Bank AG New York
00
Xxxx Xxxxxx
Xxx
Xxxx, XX 00000
Telephone:
000-000-0000
Facsimilie:
000-000-0000
|
|
DATE:
|
March
30, 2007
|
|
TO:
|
HSBC
Bank USA, National Association, not in its individual capacity,
but solely
as Supplemental Interest Trust Trustee for the Supplemental Interest
Trust
with respect to ACE Securities Corp. Home Equity Loan Trust, Series
2007-WM2 Asset Backed Pass-Through Certificates (“Party
B”)
|
|
ATTENTION:
|
HSBC
BANK USA, National Association
|
|
CTLA
- Structured Finance
|
|
000
Xxxxx XxxxxxXxxx: Xxxxx Xxx
|
|
Xxx
Xxxx, XX 00000
|
|
FROM:
|
Deutsche
Bank AG,
New York Branch
|
|
ATTENTION:
|
New
York Derivatives Documentation
|
|
TELEPHONE:
|
0
000 000 0000
|
|
FACSIMILE:
|
1
212 797 0779
|
|
EMAIL:
|
XXxxxxxxxxxx.xxxxxxxxxxxxx@xx.xxx
|
|
OUR
REFERENCE:
|
Global
No. N594309N
|
|
RE:
|
Interest
Rate Swap Transaction
|
The
purpose of this long-form confirmation (“Confirmation”)
is to
confirm the terms and conditions of the current Transaction entered into
on the
Trade Date specified below (the “Transaction”)
between
Deutsche Bank AG,
New
York Branch
(“Party
A”) and
HSBC
Bank USA, National Association, not individually, but solely as trustee (the
“Supplemental Interest Trust Trustee”) on behalf of the supplemental interest
trust with respect to the ACE Securities Corp. Home Equity Loan Trust, Series
2007-WM2 Asset Backed Pass-Through Certificates (the “Supplemental
Interest Trust”)
created under Pooling and Servicing Agreement, dated as of March 1, 2007,
among
Ace Securities Corp. (the “Depositor”),
Ocwen
Loan Servicing, LLC (the “Servicer”),
Xxxxx
Fargo Bank, National Association (the “Master
Servicer”
and the
“Securities
Administrator”)
and
HSBC Bank USA, National Association (the
“Trustee”).
This
Confirmation evidences a complete and binding agreement between you and us
to
enter into the Transaction on the terms set forth below and replaces any
previous agreement between us with respect to the subject matter hereof.
This
Confirmation constitutes a “Confirmation”
and also
constitutes a “Schedule”
as
referred to in the ISDA Master Agreement, and Paragraph 13 of a Credit Support
Annex to the Schedule.
|
1.
|
This
Confirmation shall supplement, form a part of, and be subject to
an
agreement in the form of the ISDA Master Agreement (Multicurrency
- Cross
Border) as published and copyrighted in 1992 by the International
Swaps
and Derivatives Association, Inc. (the “ISDA
Master Agreement”),
as if Party A and Party B had executed an agreement in such form
on the
date hereof, with a Schedule as set forth in Item 3 of this Confirmation,
and an ISDA Credit Support Annex (Bilateral Form - ISDA Agreements
Subject
to New York Law Only version) as published and copyrighted in 1994
by the
International Swaps and Derivatives Association, Inc., with Paragraph
13
thereof as set forth in Annex A hereto (the “Credit
Support Annex”).
For the avoidance of doubt, the Transaction described herein shall
be the
sole Transaction governed by such ISDA Master Agreement. In the
event of
any inconsistency among any of the following documents, the relevant
document first listed shall govern: (i) this Confirmation, exclusive
of
the provisions set forth in Item 3 hereof and Annex A hereto; (ii)
the
provisions set forth in Item 3 hereof, which are incorporated by
reference
into the Schedule; (iii) the Credit Support Annex; (iv) the Definitions;
and (v) the ISDA Master Agreement.
|
Chairman
of the Supervisory Board: Clemens Börsig
Management
Board: Xxxxx Xxxxxxxxx (Chairman), Xxxx Xxxxxxxx, Xxxxxx von Heydebreck,
Xxxxxxx
Xx Xxxxx, Xxxxxxx-Xxxxx Xxxxxxxx
Page
2 of
27
Each
reference herein to a “Section” (unless specifically referencing the Pooling and
Servicing Agreement) or to a “Section” “of this Agreement” will be construed as
a reference to a Section of the ISDA Master Agreement; each herein reference
to
a “Part” will be construed as a reference to the provisions herein deemed
incorporated in a Schedule to the ISDA Master Agreement; each reference herein
to a “Paragraph” will be construed as a reference to a Paragraph of the Credit
Support Annex.
|
2.
|
The
terms of the particular Transaction to which this Confirmation
relates are
as follows:
|
|
Type
of Transaction:
|
Interest
Rate Swap
|
|
Notional
Amount:
|
With
respect to any Calculation Period, the lesser of (x) the amount
set forth
for such period on Schedule I attached hereto and (y) the aggregate
Certificate Principal Balance of the Offered Certificates immediately
preceding the Distribution Date which occurs in the calendar month
of the
Floating Rate Payer Payment Date for such Calculation Period (determined
for this purpose without regard to any adjustment of the Floating
Rate
Payer Payment Date or Distribution Date relating to business days).
|
|
Trade
Date:
|
March
29, 2007
|
|
Effective
Date:
|
September
25, 2007
|
|
Termination
Date:
|
March
25, 2012, subject to adjustment in accordance with the Business
Day
Convention; provided, however, that for the purpose of determining
the
final Fixed Rate Payer Period End Date, Termination Date shall
be subject
to No Adjustment.
|
Fixed
Amounts:
|
Fixed
Rate Payer:
|
Party
B
|
Fixed
Rate Payer
|
Period
End Dates:
|
The
25th
calendar day of each month during the Term of this Transaction,
commencing
October 25, 2007, and ending on the Termination Date, with No
Adjustment.
|
Fixed
Rate Payer
|
Payment
Dates:
|
Early
Payment shall be applicable. The Floating Rate Payer Payment Date
shall be
one (1) Business Day preceding each Fixed Rate Payer Period End
Date.
|
|
Fixed
Rate:
|
4.890%
|
Fixed
Rate Day
|
Count
Fraction:
|
30/360
|
|
Additional
Payment:
|
Party
B agrees to pay USD $249,000 to Party A for value on March 30,
2007,
subject to adjustment in accordance with the Business Day
Convention
|
Floating
Amounts:
|
Floating
Rate Payer:
|
Party
A
|
Global
No. N594309N
Page 3
of 27
Floating
Rate Payer
|
Period
End Dates:
|
The
25th
calendar day of each month during the Term of this Transaction,
commencing
October 25, 2007 and ending on the Termination Date, subject to
adjustment
in accordance with the Business Day
Convention.
|
Floating
Rate Payer
|
Payment
Dates:
|
Early
Payment shall be applicable. The Floating Rate Payer Payment Date
shall be
one (1) Business Day preceding each Floating Rate Payer Period
End
Date.
|
|
Floating
Rate Option:
|
USD-LIBOR-BBA
|
|
Designated
Maturity:
|
One
month
|
Floating
Rate Day
|
Count
Fraction:
|
Actual/360
|
|
Reset
Dates:
|
The
first day of each Calculation
Period.
|
|
Compounding:
|
Inapplicable
|
|
Business
Days:
|
New
York
|
|
Business
Day Convention:
|
Following
|
|
Calculation
Agent:
|
Party
A
|
|
3.
|
Provisions
Deemed Incorporated in a Schedule to the ISDA Master
Agreement:
|
|
Part
1.
|
Termination
Provisions.
|
For
the
purposes of this Agreement:-
|
(a)
|
“Specified
Entity”
will not apply to Party A or Party B for any purpose.
|
|
(b)
|
“Specified
Transaction”
will have the meaning specified in Section
14.
|
|
(c)
|
Events
of Default.
|
The
statement below that an Event of Default will apply to a specific party means
that upon the occurrence of such an Event of Default with respect to such
party,
the other party shall have the rights of a Non-defaulting Party under Section
6
of this Agreement; conversely, the statement below that such event will not
apply to a specific party means that the other party shall not have such
rights.
|
(i)
|
The
“Failure
to Pay or Deliver”
provisions of Section 5(a)(i) will apply to Party A and will apply
to
Party B; provided, however, that Section 5(a)(i) is hereby amended
by
replacing the word “third” with the word “first”; provided, further, that
notwithstanding anything to the contrary in Section 5(a)(i), any
failure
by Party A to comply with or perform any obligation to be complied
with or
performed by Party A under the Credit Support Annex shall not constitute
an Event of Default under Section 5(a)(i) unless (A) a Required
Ratings
Downgrade Event has occurred and been continuing for 30 or more
Local
Business Days and (B) such failure is not remedied on or before
the third
Local Business Day after notice of such failure is given to Party
A.
|
Global
No. N594309N
Page 4
of 27
|
(ii)
|
The
“Breach
of Agreement”
provisions of Section 5(a)(ii) will apply to Party A and will not
apply to
Party B.
|
|
(iii)
|
The
“Credit
Support Default”
provisions of Section 5(a)(iii) will apply to Party A and will
not apply
to Party B except that Section 5(a)(iii)(1) will apply to Party
B solely
in respect of Party B’s obligations under Paragraph 3(b) of the Credit
Support Annex; provided, however, that notwithstanding anything
to the
contrary in Section 5(a)(iii)(1), any failure by Party A to comply
with or
perform any obligation to be complied with or performed by Party
A under
the Credit Support Annex shall not constitute an Event of Default
under
Section 5(a)(iii) unless (A) a Required Ratings Downgrade Event
has
occurred and been continuing for 30 or more Local Business Days
and (B)
such failure is not remedied on or before the third Local Business
Day
after notice of such failure is given to Party
A.
|
|
(iv)
|
The
“Misrepresentation”
provisions of Section 5(a)(iv) will apply to Party A and will not
apply to
Party B.
|
|
(v)
|
The
“Default
under Specified Transaction”
provisions of Section 5(a)(v) will apply to Party A and will not
apply to
Party B.
|
|
(vi)
|
The
“Cross
Default”
provisions of Section 5(a)(vi) will apply to Party A and will not
apply to
Party B, provided, however, that, notwithstanding the foregoing,
an Event
of Default shall not occur under either Section 5(a)(vi)(1) or
Section
5(a)(vi)(2) if (A) (I) the default, or other similar event or condition
referred to in Section 5(a)(vi)(1) or the failure to pay referred
to in
Section 5(a)(vi)(2) is a failure to pay or deliver caused by an
error or
omission of an administrative or operational nature, and (II) funds
or the
asset to be delivered were available to such party to enable it
to make
the relevant payment or delivery when due and (III) such payment
or
delivery is made within three (3) Local Business Days following
receipt of
written notice from an interested party of such failure to pay,
or (B)
such party was precluded from paying, or was unable to pay, using
reasonable means, through the office of the party through which
it was
acting for purposes of the relevant Specified Indebtedness, by
reason of
force majeure, act of State, illegality or impossibility.
|
For
purposes of Section 5(a)(vi), solely with respect to Party A:
“Specified
Indebtedness” will have the meaning specified in Section 14 ,except that such
term shall not include obligations in respect of deposits received in the
ordinary course of Party A’s banking business.
“Threshold
Amount” means with respect to Party A an amount equal to three percent (3%) of
the Shareholders’ Equity of Party A or, if applicable, the Eligible Guarantor.
“Shareholders’
Equity” means with respect to an entity, at any time, the sum (as shown in the
most recent annual audited financial statements of such entity) of (i) its
capital stock (including preferred stock) outstanding, taken at par value,
(ii)
its capital surplus and (iii) its retained earnings, minus (iv) treasury
stock,
each to be determined in accordance with generally accepted accounting
principles.
|
(vii)
|
The
“Bankruptcy”
provisions of Section 5(a)(vii) will apply to Party A and will
apply to
Party B except that the provisions of Section 5(a)(vii)(2), (6)
(to the
extent that such provisions refer to any appointment contemplated
or
effected by the Pooling and Servicing Agreement or any appointment
to
which Party B has not become subject), (7) and (9) will not apply
to Party
B; provided that, with respect to Party B only, Section 5(a)(vii)(4)
is
hereby amended by adding after the words “against it” the words
“(excluding any proceeding or petition instituted or presented by
Party A
or its Affiliates)”, and Section 5(a)(vii)(8) is hereby amended by
deleting the words “to (7) inclusive” and inserting lieu thereof “, (3),
(4) as amended, (5), (6) as amended, or
(7)”.
|
|
(viii)
|
The
“Merger
Without Assumption”
provisions of Section 5(a)(viii) will apply to Party A and will
apply to
Party B.
|
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|
(d)
|
Termination
Events.
|
The
statement below that a Termination Event will apply to a specific party means
that upon the occurrence of such a Termination Event, if such specific party
is
the Affected Party with respect to a Tax Event, the Burdened Party with respect
to a Tax Event Upon Merger (except as noted below) or the non-Affected Party
with respect to a Credit Event Upon Merger, as the case may be, such specific
party shall have the right to designate an Early Termination Date in accordance
with Section 6 of this Agreement; conversely, the statement below that such
an
event will not apply to a specific party means that such party shall not
have
such right; provided, however, with respect to “Illegality” the statement that
such event will apply to a specific party means that upon the occurrence
of such
a Termination Event with respect to such party, either party shall have the
right to designate an Early Termination Date in accordance with Section 6
of
this Agreement.
|
(i)
|
The
“Illegality”
provisions of Section 5(b)(i) will apply to Party A and will apply
to
Party B.
|
|
(ii)
|
The
“Tax
Event”
provisions of Section 5(b)(ii) will apply to Party A except that,
for
purposes of the application of Section 5(b)(ii) to Party A, Section
5(b)(ii) is hereby amended by deleting the words “(x) any action taken by
a taxing authority, or brought in a court of competent jurisdiction,
on or
after the date on which a Transaction is entered into (regardless
of
whether such action is taken or brought with respect to a party
to this
Agreement) or (y)”, and the “Tax
Event”
provisions of Section 5(b)(ii) will apply to Party B.
|
|
(iii)
|
The
“Tax
Event Upon Merger”
provisions of Section 5(b)(iii) will apply to Party A and will
apply to
Party B, provided that Party A shall not be entitled to designate
an Early
Termination Date by reason of a Tax Event upon Merger in respect
of which
it is the Affected Party.
|
|
(iv)
|
The
“Credit
Event Upon Merger”
provisions of Section 5(b)(iv) will not apply to Party A and will
not
apply to Party B.
|
|
(e)
|
The
“Automatic
Early Termination”
provision of Section 6(a) will not apply to Party A and will not
apply to
Party B.
|
|
(f)
|
Payments
on Early Termination.
For the purpose of Section 6(e) of this
Agreement:
|
|
(i)
|
Market
Quotation will apply, provided, however, that, in the event of
a
Derivative Provider Trigger Event, the following provisions will
apply:
|
|
(A)
|
The
definition of Market Quotation in Section 14 shall be deleted in
its
entirety and replaced with the
following:
|
“Market
Quotation” means,
with respect to one or more Terminated Transactions, a Firm Offer which is
(1)
made by a Reference Market-maker that is an Eligible Replacement, (2) for
an
amount that would be paid to Party B (expressed as a negative number) or
by
Party B (expressed as a positive number) in consideration of an agreement
between Party B and such Reference Market-maker to enter into a Replacement
Transaction, and (3) made on the basis that Unpaid Amounts in respect of
the
Terminated Transaction or group of Transactions are to be excluded but, without
limitation, any payment or delivery that would, but for the relevant Early
Termination Date, have been required (assuming satisfaction of each applicable
condition precedent) after that Early Termination Date is to be
included.
|
(B)
|
The
definition of Settlement Amount shall be deleted in its entirety
and
replaced with the following:
|
“Settlement
Amount”
means,
with respect to any Early Termination Date, an amount (as determined by Party
B)
equal to:
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|
(a)
|
If
a Market Quotation for the relevant Terminated Transaction or group
of
Terminated Transactions is accepted by Party B so as to become
legally
binding on or before the day falling ten Local Business Days after
the day
on which the Early Termination Date is designated, or such later
day as
Party B may specify in writing to Party A, but in either case no
later
than one Local Business Day prior to the Early Termination Date
(such day,
the “Latest Settlement Amount Determination Day”), the Termination
Currency Equivalent of the amount (whether positive or negative)
of such
Market Quotation;
|
|
(b)
|
If,
on the Latest Settlement Amount Determination Day, no Market Quotation
for
the relevant Terminated Transaction or group of Terminated Transactions
has been accepted by Party B so as to become legally binding and
one or
more Market Quotations from
Approved Replacements have
been made and remain capable of becoming legally binding upon acceptance,
the Settlement Amount shall equal the Termination Currency Equivalent
of
the amount (whether positive or negative) of the lowest of such
Market
Quotations (for the avoidance of doubt, the lowest of such Market
Quotations shall be the lowest Market Quotation of
such Market Quotations
expressed as a positive number or, if any of such Market Quotations
is
expressed as a negative number, the Market Quotation expressed
as a
negative number with the largest absolute value);
or
|
|
(c)
|
If,
on the Latest Settlement Amount Determination Day, no Market Quotation
for
the relevant Terminated Transaction or group of Terminated Transactions
is
accepted by Party B so as to become legally binding and no Market
Quotation from an Approved Replacement remains capable of becoming
legally
binding upon acceptance, the Settlement Amount shall equal Party
B’s Loss
(whether positive or negative and without reference to any Unpaid
Amounts)
for the relevant Terminated Transaction or group of Terminated
Transactions.
|
|
(C)
|
If
Party B requests Party A in writing to obtain Market Quotations,
Party A
shall use its reasonable efforts to do so before the Latest Settlement
Amount Determination Day.
|
|
(D)
|
If
the Settlement Amount is a negative number, Section 6(e)(i)(3)
shall be
deleted in its entirety and replaced with the
following:
|
“(3)
Second
Method and Market Quotation.
If the
Second Method and Market Quotation apply, (I) Party B shall pay to Party
A an
amount equal to the absolute value of the Settlement Amount in respect of
the
Terminated Transactions, (II) Party B shall pay to Party A the Termination
Currency Equivalent of the Unpaid Amounts owing to Party A and (III) Party
A
shall pay to Party B the Termination Currency Equivalent of the Unpaid Amounts
owing to Party B; provided, however, that (x) the amounts payable under the
immediately preceding clauses (II) and (III) shall be subject to netting
in
accordance with Section 2(c) of this Agreement and (y) notwithstanding any
other
provision of this Agreement, any amount payable by Party A under the immediately
preceding clause (III) shall not be netted-off against any amount payable
by
Party B under the immediately preceding clause (I).”
|
(E)
|
At
any time on or before the Latest Settlement Amount Determination
Day at
which two or more Market Quotations from Approved Replacements
remain
capable of becoming legally binding upon acceptance, Party B shall
be
entitled to accept only the lowest of such Market Quotations (for
the
avoidance of doubt, the lowest of such Market Quotations shall
be the
lowest Market Quotation of such Market Quotations expressed as
a positive
number or, if any of such Market Quotations is expressed as a negative
number, the Market Quotation expressed as a negative number with
the
largest absolute value).
|
|
(ii)
|
The
Second Method will apply.
|
Global
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|
(g)
|
“Termination
Currency”
means USD.
|
|
(h)
|
Additional
Termination Events.
Additional Termination Events will apply as provided in Part 5(c).
|
Global No. N594309N
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Part
2. Tax
Matters.
|
(a)
|
Tax
Representations.
|
|
(i)
|
Payer
Representations.
For the purpose of Section 3(e) of this Agreement:
|
|
(A)
|
Party
A makes the following
representation(s):
|
It
is not
required by any applicable law, as modified by the practice of any relevant
governmental revenue authority, of any Relevant Jurisdiction to make any
deduction or withholding for or on account of any Tax from any payment (other
than interest under Section 2(e), 6(d)(ii) or 6(e) of this Agreement) to
be made
by it to the other party under this Agreement. In making this representation,
it
may rely on: the accuracy of any representations made by the other party
pursuant to Section 3(f) of this Agreement; (ii) the satisfaction of the
agreement contained in Section 4(a)(i) or 4(a)(iii) of this Agreement and
the
accuracy and effectiveness of any document provided by the other party pursuant
to Section 4(a)(i) or 4(a)(iii) of this Agreement; and (iii) the satisfaction
of
the agreement of the other party contained in Section 4(d) of this Agreement,
provided that it shall not be a breach of this representation where reliance
is
placed on clause (ii) and the other party does not deliver a form or document
under Section 4(a)(iii) by reason of material prejudice to its legal or
commercial position.
|
(B)
|
Party
B makes the following
representation(s):
|
None.
(ii)
Payee
Representations.
For the
purpose of Section 3(f) of this Agreement:
(A) Party
A
makes the following representation(s):
It
is a
“foreign person” within the meaning of the applicable U.S. Treasury Regulations
concerning information reporting and backup withholding tax (as in effect
on
January 1, 2001), unless Party A provides written notice to Party B that
it is
no longer a foreign person. In respect of any Transaction it enters into
through
an office or discretionary agent in the United States or which otherwise
is
allocated for United States federal income tax purposes to such United States
trade or business, each payment received or to be received by it under such
Transaction will be effectively connected with its conduct of a trade or
business in the United States.
|
(B)
|
Party
B makes the following
representation(s):
|
None.
|
(b)
|
Tax
Provisions.
|
|
(i)
|
Gross
Up.
Section 2(d)(i)(4) shall not apply to Party B as X, and Section
2(d)(ii)
shall not apply to Party B as Y, in each case such that Party B
shall not
be required to pay any additional amounts referred to
therein.
|
|
(ii)
|
Indemnifiable
Tax.
The definition of “Indemnifiable Tax” in Section 14 is deleted in its
entirety and replaced with the
following:
|
“Indemnifiable
Tax”
means,
in relation to payments by Party A, any Tax and, in relation to payments
by
Party B, no Tax.
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Part
3. Agreement
to Deliver Documents.
|
(a)
|
For
the purpose of Section 4(a)(i), tax forms, documents, or certificates
to
be delivered are:
|
|
Party
required to
deliver document
|
Form/Document/
Certificate
|
Date
by which to
be
delivered
|
||
|
Party
A
|
A
correct, complete and duly executed U.S. Internal Revenue Service
Form
W-8ECI or other applicable form (or successor thereto), together
with
appropriate attachments, that eliminates U.S. federal withholding
and
backup withholding Tax on payments to Party A under this
Agreement.
|
(i)
upon execution of this Agreement, (ii) on or before the first payment
date
under this Agreement, including any Credit Support Document, (iii)
promptly upon the reasonable demand by Party B, (iv) prior to the
expiration or obsolescence of any previously delivered form, and
(v)
promptly upon the information on any such previously delivered
form
becoming inaccurate or incorrect.
|
||
|
Party
B
|
Party
B will deliver at closing an original properly completed and executed
United States Internal Revenue Service Form W-9 or other applicable
form
(or any successor thereto) with respect to any payments received
or to be
received by Party A, that eliminates U.S. federal withholding and
backup
withholding Tax on payments to Party A under this Agreement, and
may
deliver other tax forms relating to the beneficial owner of payments
to
Party B under this Agreement from time to time.
|
(i)
upon execution of this Agreement, (ii) on or before the first payment
date
under this Agreement, including any Credit Support Document, (iii)
promptly upon the reasonable demand by Party B, (iv) prior to the
expiration or obsolescence of any previously delivered form, and
(v)
promptly upon the information on any such previously delivered
form
becoming inaccurate or incorrect.
|
Global No. N594309N
Page 10
of 27
(b) For
the
purpose of Section 4(a)(ii), other documents to be delivered (unless otherwise
publicly available) are:
|
Party
required
to
deliver
document
|
Form/Document/
Certificate
|
Date
by which to
be
delivered
|
Covered
by
Section
3(d)
Representation
|
|||
|
Party
A and
Party
B
|
Any
documents required by the receiving party to evidence the authority
of the
delivering party or its Credit Support Provider, if any, for it
to execute
and deliver the Agreement, this Confirmation, and any Credit Support
Documents to which it is a party, and to evidence the authority
of the
delivering party or its Credit Support Provider to perform its
obligations
under the Agreement, this Confirmation and any Credit Support Document,
as
the case may be
|
Upon
the execution and delivery of this Agreement
|
Yes
|
|||
|
Party
A and
Party
B
|
A
certificate of an authorized officer of the party, as to the incumbency
and authority of the respective officers of the party signing the
Agreement, this Confirmation, and any relevant Credit Support Document,
as
the case may be
|
Upon
the execution and delivery of this Agreement
|
Yes
|
|||
|
Party
A
|
Annual
Report of Party A containing consolidated financial statements
certified
by independent certified public accountants and prepared in accordance
with generally accepted accounting principles in the country in
which
Party A is organized
|
Promptly
upon becoming publicly available
|
Yes
|
|||
|
Party
A
|
Quarterly
Financial Statements of Party A containing unaudited, consolidated
financial statements of Party A’s fiscal quarter prepared in accordance
with generally accepted accounting principles in the country in
which
Party A is organized
|
Promptly
upon becoming publicly available
|
Yes
|
|||
|
Party
A
|
An
opinion of counsel to Party A acceptable in form and substance
to Party
B
|
Upon
the execution and delivery of this Agreement
|
No
|
Part
4. Miscellaneous.
|
(a)
|
Address
for Notices:
For the purposes of Section 12(a) of this
Agreement:
|
Address
for notices or communications to Party A:
Any
notice to Party A relating to a particular Transaction shall be delivered
to the
address or facsimile number specified in the Confirmation of such Transaction.
Any notice delivered for purposes of Sections 5 and 6 (other than notices
under
Section 5(a)(i) with respect to Party A) of this Agreement shall be delivered
to
the following address:
Global
No. N594309N
Page 11
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Xxxxxxxx
Xxxx XX, Xxxx Office
Xxxxxxxxxxxx
00
00000
Xxxxxxxxx
XXXXXXX
Attention:
Legal Department
Fax
No:
0000 00 000 00000
(For
all
purposes)
Address
for notices or communications to Party B:
|
Address:
|
HSBC
BANK USA, National Association
|
CTLA
-
Structured Finance
000
Xxxxx
Xxxxxx
Xxx
Xxxx,
XX 00000
|
Attention:
|
Xxxxx
Xxx
|
|
Tel:
|
000-000-0000
|
with
a
copy to:
|
Address:
|
Xxxxx
Fargo Bank, N.A.
|
0000
Xxx
Xxxxxxxxx Xxxx
Xxxxxxxx,
Xxxxxxxx 00000
|
Attention:
|
Client
Manager Ace 2007-WM2
|
|
Tel:
|
000-000-0000
|
|
Fax:
|
000-000-0000
|
(For
all
purposes)
|
(b)
|
Process
Agent.
For the purpose of Section 13(c):
|
Party
A
appoints as its Process Agent: Not applicable.
Party
B
appoints as its Process Agent: Not applicable.
|
(c)
|
Offices.
The provisions of Section 10(a) will apply to this Agreement; neither
Party A nor Party B has any Offices other than as set forth in
the Notices
Section and Party A agrees that, for purposes of Section 6(b) of
this
Agreement, it shall not in the future have any Office other than
one in
the United States.
|
|
(d)
|
Multibranch
Party.
For the purpose of Section 10(c) of this
Agreement:
|
Party
A
is not a Multibranch Party.
|
Party
B is not a Multibranch Party.
|
|
(e)
|
Calculation
Agent.
The Calculation Agent is Party A; provided, however, that if an
Event of
Default shall have occurred with respect to Party A, Party B shall
have
the right to appoint as Calculation Agent a third party, reasonably
acceptable to Party A, the cost for which shall be borne by Party
A.
|
|
(f)
|
Credit
Support Document.
|
|
Party
A:
|
The
Credit Support Annex, and any guarantee in support of Party A’s
obligations under this Agreement.
|
Global
No. N594309N
Page 12
of 27
|
Party
B:
|
The
Credit Support Annex, solely in respect of Party B’s obligations under
Paragraph 3(b) of the Credit Support
Annex.
|
|
(g)
|
Credit
Support Provider.
|
|
Party
A:
|
The
guarantor under any guarantee in support of Party A’s obligations under
this Agreement.
|
|
Party
B:
|
None.
|
|
(h)
|
Governing
Law.
The parties to this Agreement hereby agree that the law of the
State of
New York shall govern their rights and duties in whole, without
regard to
the conflict of law provisions thereof other than New York General
Obligations Law Sections 5-1401 and 5-1402.
|
|
(i)
|
Netting
of Payments.
The parties agree that subparagraph (ii) of Section 2(c) will apply
to
each Transaction hereunder.
|
|
(j)
|
Affiliate.“Affiliate”
shall have the meaning assigned thereto in Section 14; provided,
however,
that Party B shall be deemed to have no Affiliates for purposes
of this
Agreement, including for purposes of Section
6(b)(ii).
|
Global No. N594309N
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Part
5. Others
Provisions.
|
(a)
|
Definitions.
Unless
otherwise specified in a Confirmation, this Agreement and each
Transaction
under this Agreement are subject to the 2000 ISDA Definitions as
published
and copyrighted in 2000 by the International Swaps and Derivatives
Association, Inc. (the “Definitions”),
and will be governed in all relevant respects by the provisions
set forth
in the Definitions, without regard to any amendment to the Definitions
subsequent to the date hereof. The provisions of the Definitions
are
hereby incorporated by reference in and shall be deemed a part
of this
Agreement, except that (i) references in the Definitions to a “Swap
Transaction” shall be deemed references to a “Transaction” for purposes of
this Agreement, and (ii) references to a “Transaction” in this Agreement
shall be deemed references to a “Swap Transaction” for purposes of the
Definitions. Each term capitalized but not defined in this Agreement
shall
have the meaning assigned thereto in the Pooling and Servicing
Agreement.
|
|
(b)
|
Amendments
to ISDA Master Agreement.
|
|
(i)
|
Single
Agreement.
Section 1(c) is hereby amended by the adding the words “including, for the
avoidance of doubt, the Credit Support Annex” after the words “Master
Agreement”.
|
|
(ii)
|
Conditions
Precedent. Section
2(a)(iii) is hereby amended by adding the following at the end
thereof:
|
Notwithstanding
anything to the contrary in Section 2(a)(iii)(1), if an Event of Default
with
respect to Party B or Potential Event of Default with respect to Party B
has
occurred and been continuing for more than 30 Local Business Days and no
Early
Termination Date in respect of the Affected Transactions has occurred or
been
effectively designated by Party A, the obligations of Party A under Section
2(a)(i) shall cease to be subject to the condition precedent set forth in
Section 2(a)(iii)(1) with respect to such specific occurrence of such Event
of
Default or such Potential Event of Default (the “Specific
Event”);
provided, however, for the avoidance of doubt, the obligations of Party A
under
Section 2(a)(i) shall be subject to the condition precedent set forth in
Section
2(a)(iii)(1) (subject to the foregoing) with respect to any subsequent
occurrence of the same Event of Default with respect to Party B or Potential
Event of Default with respect to Party B after the Specific Event has ceased
to
be continuing and with respect to any occurrence of any other Event of Default
with respect to Party B or Potential Event of Default with respect to Party
B
that occurs subsequent to the Specific Event.
|
(iii)
|
Change
of Account.
Section 2(b) is hereby amended by the addition of the following
after the
word “delivery” in the first line
thereof:
|
“to
another account in the same legal and tax jurisdiction as the original
account”.
|
(iv)
|
Representations.
Section 3 is hereby amended by adding at the end thereof the following
subsection (g):
|
|
“(g)
|
Relationship
Between Parties.
|
|
(1)
|
Nonreliance.
(i) It is not relying on any statement or representation of the
other
party regarding the Transaction (whether written or oral), other
than the
representations expressly made in this Agreement or the Confirmation
in
respect of that Transaction and (ii) it has consulted with its
own legal,
regulatory, tax, business, investment, financial and accounting
advisors
to the extent it has deemed necessary, and it has made its own
investment,
hedging and trading decisions based upon its own judgment and upon
any
advice from such advisors as it has deemed necessary and not upon
any view
expressed by the other party.
|
|
(2)
|
Evaluation
and Understanding. (i) It has the capacity to evaluate (internally
or
through independent professional advice) the Transaction and has
made its
own decision to enter into the Transaction and (ii) It understands
the
terms, conditions and risks of the Transaction and is willing and
able to
accept those terms and conditions and to assume those risks, financially
and otherwise.
|
Global
No. N594309N
Page 14
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|
(3)
|
Purpose.
It is entering into the Transaction for the purposes of managing
its
borrowings or investments, hedging its underlying assets or liabilities
or
in connection with a line of business.
|
|
(4)
|
Status
of Parties. The other party is not acting as an agent, fiduciary
or
advisor for it in respect of the Transaction.
|
|
(5)
|
Eligible
Contract Participant. It is an “eligible swap participant” as such term is
defined in, Section 35.1(b)(2) of the regulations (17 C.F.R. 35)
promulgated under, and an “eligible contract participant” as defined in
Section 1(a)(12) of the Commodity Exchange Act, as
amended.”
|
|
(v)
|
Transfer
to Avoid Termination Event.
Section 6(b)(ii) is hereby amended by (i) deleting the words “or if a Tax
Event Upon Merger occurs and the Burdened Party is the Affected
Party,”
and (ii) by deleting the words “to transfer” and inserting the words “to
effect a Permitted Transfer” in lieu
thereof.
|
|
(vi)
|
Jurisdiction.
Section
13(b) is hereby amended by: (i) deleting in the second line of
subparagraph (i) thereof the word "non-", (ii) deleting “; and” from the
end of subparagraph 1 and inserting “.” in lieu thereof, and (iii)
deleting the final paragraph
thereof.
|
|
(vii)
|
Local
Business Day.
The definition of Local Business Day in Section 14 is hereby amended
by
the addition of the words “or any Credit Support Document” after “Section
2(a)(i)” and the addition of the words “or Credit Support Document” after
“Confirmation”.
|
|
(c)
|
Additional
Termination Events.
The following Additional Termination Events will
apply:
|
|
(i)
|
First
Rating Trigger Collateral.
If
(A) it is not the case that a Xxxxx’x Second Trigger Ratings Event has
occurred and been continuing for 30 or more Local Business Days
and (B)
Party
A has failed to comply with or perform any obligation to be complied
with
or performed by Party A in accordance with the Credit Support Annex,
then
an Additional Termination Event shall have occurred with respect
to Party
A and Party A shall be the sole Affected Party with respect to
such
Additional Termination Event.
|
|
(ii)
|
Second
Rating Trigger Replacement.
If
(A) a Required Ratings Downgrade Event has occurred and been continuing
for 30 or more Local Business Days and (B) (i) at least one Eligible
Replacement has made a Firm Offer to be the transferee of all of
Party A’s
rights and obligations under this Agreement (and such Firm Offer
remains
an offer that will become legally binding upon such Eligible Replacement
upon acceptance by the offeree) and/or (ii) an Eligible Guarantor
has made
a Firm Offer to provide an Eligible Guarantee (and such Firm Offer
remains
an offer that will become legally binding upon such Eligible Guarantor
immediately upon acceptance by the offeree), then an Additional
Termination Event shall have occurred with respect to Party A and
Party A
shall be the sole Affected Party with respect to such Additional
Termination Event.
|
|
(iii)
|
Amendment
of Pooling and Servicing Agreement.
If, without the prior written consent of Party A where such consent
is
required under the Pooling and Servicing Agreement (such consent
not to be
unreasonably withheld), an amendment is made to the Pooling and
Servicing
Agreement which amendment could reasonably be expected to have
a material
adverse effect on the interests of Party A (excluding, for the
avoidance
of doubt, any amendment to the Pooling and Servicing Agreement
that is
entered into solely for the purpose of appointing a successor servicer,
master servicer, securities administrator, trustee or other service
provider) under this Agreement, an Additional Termination Event
shall have
occurred with respect to Party B and Party B shall be the sole
Affected
Party with respect to such Additional Termination Event.
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No. N594309N
Page 15
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(iv)
|
Failure
to Comply with Regulation AB Requirements. If,
upon the occurrence of a Disclosure Event (as defined in Part 5(e)
below)
Party A has not complied with any of the provisions set forth in
clause
(iii) of Part 5(e) below, then an Additional Termination Event
shall have
occurred with respect to Party A and Party A shall be the sole
Affected
Party with respect to such Additional Termination
Event.
|
|
(v)
|
Optional
Termination of Securitization.
An Additional Termination Event shall occur upon the notice to
Certificateholders of an Optional Termination becoming unrescindable
in
accordance with Article X of the Pooling and Servicing Agreement
(such
notice, the “Optional
Termination Notice”).
With respect to such Additional Termination Event: (A) Party B
shall be
the sole Affected Party; (B) notwithstanding anything to the contrary
in
Section 6(b)(iv) or Section 6(c)(i), the final Distribution Date
specified
in the Optional Termination Notice is hereby designated as the
Early
Termination Date for this Additional Termination Event in respect
of all
Affected Transactions; (C) Section 2(a)(iii)(2) shall not be applicable
to
any Affected Transaction in
connection with the Early Termination Date resulting from this
Additional
Termination Event; notwithstanding anything to the contrary in
Section
6(c)(ii), payments and deliveries under Section 2(a)(i) or Section
2(e) in
respect of the Terminated Transactions resulting from this Additional
Termination Event will be required to be made through and including
the
Early Termination Date designated
as a result of this Additional Termination Event; provided, for
the
avoidance of doubt, that any such payments or deliveries that are
made on
or prior to such Early Termination Date will not be treated as
Unpaid
Amounts in determining the amount payable in respect of such Early
Termination Date; (D) notwithstanding anything to the contrary
in Section
6(d)(i), (I) if, no later than 4:00 pm New York City time on the
day that
is four Business Days prior to the final Distribution Date specified
in
the Optional Termination Notice, the Securities Administrator requests
the
amount of the Estimated Swap Termination Payment, Party A shall
provide to
the Securities Administrator in writing (which may be done in electronic
format) the amount of the Estimated Swap Termination Payment no
later than
2:00 pm New York City time on the following Business Day and (II)
if the
Securities Administrator provides written notice (which may be
done in
electronic format) to Party A no later than two Business Days prior
to the
final Distribution Date specified in the Optional Termination Notice
that
all requirements of the Optional Termination have been met, then
Party A
shall, no later than one Business Day prior to the final Distribution
Date
specified in the Optional Termination Notice, make the calculations
contemplated by Section 6(e) of the ISDA Master Agreement (as amended
herein) and provide to the Securities Administrator in writing
(which may
be done in electronic format) the amount payable by either Party
B or
Party A in respect of the related Early Termination Date in
connection with this Additional Termination Event; provided, however,
that
the amount payable by Party B, if any, in respect of the related
Early
Termination Date shall be the lesser of (x) the amount calculated
to be
due from Party B pursuant to Section 6(e) and (y) the Estimated
Swap
Termination Payment; and (E) notwithstanding anything to the contrary
in
this Agreement, any amount due from Party B to Party A in respect
of this
Additional Termination Event will be payable on the final Distribution
Date specified in the Optional Termination Notice and any amount
due from
Party A to Party B in respect of this Additional Termination Event
will be
payable one Business Day prior to the final Distribution Date specified
in
the Optional Termination Notice. The Securities Administrator shall
be an
express third party beneficiary of this Agreement as if a party
hereto to
the extent of the Securities Administrator’s rights specified herein.
|
|
(d)
|
Required
Ratings Downgrade Event.
In
the event that no Relevant Entity has credit ratings at least equal
to the
Required Ratings Threshold, then Party A shall, as soon as reasonably
practicable and so long as a Required Ratings Downgrade Event is
in
effect, at its own expense, using commercially reasonable efforts,
procure
either (A) a Permitted Transfer or (B) an Eligible
Guarantee.
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No. N594309N
Page 16
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(e)
|
Compliance
with Regulation AB.
|
(i) Party
A agrees and acknowledges that Ace Securities Corp. (“ACE”) is required under
Regulation AB under the Securities Act of 1933, as amended, and the Securities
Exchange Act of 1934, as amended (the “Exchange Act”) (“Regulation AB”), to
disclose certain financial information regarding Party A or its group of
affiliated entities, if applicable, depending on the aggregate “significant
percentage” of this Agreement and any other derivative contracts between Party A
or its group of affiliated entities, if applicable, and Counterparty, as
calculated from time to time in accordance with Item 1115 of Regulation
AB.
(ii) It
shall be a swap disclosure event (“Swap Disclosure Event”) if, on any Business
Day after the date hereof, ACE requests from Party A the applicable financial
information described in Item 1115 of Regulation AB (such request to be based
on
a reasonable determination by ACE, in good faith, that such information is
required under Regulation AB) (the “Swap Financial Disclosure”).
(iii)
Upon
the occurrence of a Swap Disclosure Event, Party A, at its own expense, shall
(1)(a) either (i) provide to ACE the current Swap Financial Disclosure in
an
XXXXX-compatible format (for example, such information may be provided in
Microsoft Word® or Microsoft Excel® format but not in .pdf format) or (ii)
provide written consent to ACE to incorporation by reference of such current
Swap Financial Disclosure as is filed with the Securities and Exchange
Commission in the Exchange Act Reports of ACE, (b) if applicable, cause its
outside accounting firm to provide its consent to filing or incorporation
by
reference in the Exchange Act Reports of ACE of such accounting firm’s report
relating to their audits of such current Swap Financial Disclosure, and (c)
provide to ACE any updated Swap Financial Disclosure with respect to Party
A or
any entity that consolidates Party A within five days of the release of any
such
updated Swap Financial Disclosure; (2) secure an Eligible Replacement, which
entity complies with the requirements of Item 1115 of Regulation AB, including
providing the information contemplated by Part 5(e)(iii)(1) above, to enter
a
Replacement Transaction by way of a Permitted Transfer or (3) obtain an Eligible
Guarantee of Party A’s obligations under this Agreement from an affiliate of
Party A that is able to comply with the financial information disclosure
requirements of Item 1115 of Regulation AB, including providing the information
contemplated by Part 5(e)(iii)(1) above, such that disclosure provided in
respect of the affiliate will satisfy any disclosure requirements applicable
to
Party A, and cause such affiliate to provide Swap Financial Disclosure. If
permitted by Regulation AB, any required Swap Financial Disclosure may be
provided by incorporation by reference from reports filed pursuant to the
Exchange Act.
(iv) Party
A and the primary obligor under any Credit Support Document agree that, in
the
event that Party A provides Swap Financial Disclosure to ACE in accordance
with
Part 5(e)(iii)(a) or causes its affiliate to provide Swap Financial Disclosure
to ACE in accordance with Part 5(e)(iii)(c), Party A and such primary obligor
will indemnify and hold harmless ACE, its respective directors or officers
and
any person controlling ACE, from and against any and all losses, claims,
damages
and liabilities caused by any untrue statement or alleged untrue statement
of a
material fact contained in such Swap Financial Disclosure or caused by any
omission or alleged omission to state in such Swap Financial Disclosure a
material fact, when considered in conjunction with any other information
regarding Party A or the derivative instrument being written by Party A in
the
final prospectus for ACE 2007-WM2, required to be stated therein or necessary
to
make the statements therein, in light of the circumstances under which they
were
made, not misleading.
(v)
Third Party Beneficiary. ACE shall be an express third party beneficiary
of this
Agreement as if a party hereto to the extent of ACE’s rights explicitly
specified herein.
|
(f)
|
Transfers.
|
|
(i)
|
Section
7 is hereby amended to read in its entirety as
follows:
|
“Except
with respect to any Permitted Transfer pursuant to Section 6(b)(ii), Part
5(d),
and Part 5(e), or the succeeding sentence, neither Party A nor Party B is
permitted to assign, novate or transfer (whether by way of security or
otherwise) as a whole or in part any of its rights, obligations or interests
under the Agreement or any Transaction unless (a) the prior written consent
of
the other party is obtained and (b) the Rating Agency Condition has been
satisfied with respect to S&P. At any time at which no Relevant Entity has
credit ratings at least equal to the Approved Ratings Threshold, Party A
may
make a Permitted Investment.”
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No. N594309N
Page 17
of 27
|
(ii)
|
If
an Eligible Replacement has made a Firm Offer (which remains an
offer that
will become legally binding upon acceptance by Party B) to be the
transferee pursuant to a Permitted Transfer, Party B shall, at
Party A’s
written request and at Party A’s expense, take any reasonable steps
required to be taken by Party B to effect such transfer.
|
|
(g)
|
Non-Recourse.
Party A acknowledges and agree that, notwithstanding any provision
in this
Agreement to the contrary, the obligations of Party B hereunder
are
limited recourse obligations of Party B, payable solely from the
Supplemental Interest Trust and the proceeds thereof, in accordance
with
the priority of payments and other terms of the Pooling and Servicing
Agreement and that Party A will not have any recourse to any of
the
directors, officers, employees, shareholders or affiliates of the
Party B
with respect to any claims, losses, damages, liabilities, indemnities
or
other obligations in connection with any transactions contemplated
hereby.
In the event that the Supplemental Interest Trust and the proceeds
thereof, should be insufficient to satisfy all claims outstanding
and
following the realization of the Supplemental Interest Trust and
the
proceeds thereof, any claims against or obligations of Party B
under the
ISDA Master Agreement or any other confirmation thereunder still
outstanding shall be extinguished and thereafter not revive. The
Supplemental Interest Trust Trustee shall not have liability for
any
failure or delay in making a payment hereunder to Party A due to
any
failure or delay in receiving amounts in the account held by the
Supplemental Interest Trust created pursuant to the Pooling and
Servicing
Agreement. This provision will survive the termination of this
Agreement.
|
|
(h)
|
Timing
of Payments
by Party B upon Early Termination.
Notwithstanding anything to the contrary in Section 6(d)(ii), to
the
extent that all or a portion (in either case, the “Unfunded Amount”) of
any amount that is calculated as being due in respect of any Early
Termination Date under Section 6(e) from Party B to Party A will
be paid
by Party B from amounts other than any upfront payment paid to
Party B by
an Eligible Replacement that has entered a Replacement Transaction
with
Party B, then such Unfunded Amount shall be due on the next subsequent
Distribution Date following the date on which the payment would
have been
payable as determined in accordance with Section 6(d)(ii), and
on any
subsequent Distribution Dates until paid in full (or if such Early
Termination Date is the final Distribution Date, on such final
Distribution Date); provided, however, that if the date on which
the
payment would have been payable as determined in accordance with
Section
6(d)(ii) is a Distribution Date, such payment will be payable on
such
Distribution Date.
|
|
(i)
|
Rating
Agency Notifications. Notwithstanding
any other provision of this Agreement, no Early Termination Date
shall be
effectively designated hereunder by Party B and no transfer of
any rights
or obligations under this Agreement shall be made by either party
unless
each Swap Rating Agency has been given prior written notice of
such
designation or transfer.
|
|
(j)
|
No
Set-off.
Except as expressly provided for in Section 2(c), Section 6 or
Part
1(f)(i)(D) hereof, and notwithstanding any other provision of this
Agreement or any other existing or future agreement, each party
irrevocably waives any and all rights it may have to set off, net,
recoup
or otherwise withhold or suspend or condition payment or performance
of
any obligation between it and the other party hereunder against
any
obligation between it and the other party under any other agreements.
Section 6(e) shall be amended by deleting the following sentence:
“The
amount, if any, payable in respect of an Early Termination Date
and
determined pursuant to this Section will be subject to any
Set-off.”.
|
|
(k)
|
Amendment.
Notwithstanding any provision to the contrary in this Agreement,
no
amendment of either this Agreement or any Transaction under this
Agreement
shall be permitted by either party unless each of the Swap Rating
Agencies
has been provided prior written notice of the same and such amendment
satisfies the Rating Agency Condition with respect to
S&P.
|
|
(l)
|
Notice
of Certain Events or Circumstances.
Each Party agrees, upon learning of the occurrence or existence
of any
event or condition that constitutes (or that with the giving of
notice or
passage of time or both would constitute) an Event of Default or
Termination Event with respect to such party, promptly to give
the other
Party and to each Swap Rating Agency notice of such event or condition;
provided that failure to provide notice of such event or condition
pursuant to this Part 5(l) shall not constitute an Event of Default
or a
Termination Event.
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Global No. N594309N
Page 18
of 27
(m) Proceedings.
No
Relevant Entity shall institute against, or cause any other person to institute
against, or join any other person in instituting against Party B, the
Supplemental Interest Trust or the trust formed pursuant to the Pooling and
Servicing Agreement, in any bankruptcy, reorganization, arrangement, insolvency
or liquidation proceedings or other proceedings under any federal or state
bankruptcy or similar law for a period of one year (or, if longer, the
applicable preference period) and one day following payment in full of the
Certificates and any Notes. This provision will survive the termination of
this
Agreement.
|
(n)
|
Supplemental
Interest Trust Trustee Liability Limitations.
It
is expressly understood and agreed by the parties hereto that (a)
this
Agreement is executed by HSBC Bank USA, National Association (“HSBC”)
not in its individual capacity, but solely as Supplemental Interest
Trust
Trusteee under the Pooling and Servicing Agreement in the exercise
of the
powers and authority conferred and invested in it thereunder; (b)
HSBC has
been directed pursuant to the Pooling and Servicing Agreement to
enter
into this Agreement and to perform its obligations hereunder; (c)
each of
the representations, undertakings and agreements herein made on
behalf of
Party B is made and intended not as personal representations of
the
Supplemental Interest Trust but is made and intended for the purpose
of
binding only Party B; and (d) under no circumstances shall HSBC
in its individual capacity be personally liable for any payments
hereunder
or for the breach or failure of any obligation, representation,
warranty
or covenant made or undertaken under this
Agreement.
|
|
(o)
|
Severability.
If
any term, provision, covenant, or condition of this Agreement,
or the
application thereof to any party or circumstance, shall be held
to be
invalid or unenforceable (in whole or in part) in any respect,
the
remaining terms, provisions, covenants, and conditions hereof shall
continue in full force and effect as if this Agreement had been
executed
with the invalid or unenforceable portion eliminated, so long as
this
Agreement as so modified continues to express, without material
change,
the original intentions of the parties as to the subject matter
of this
Agreement and the deletion of such portion of this Agreement will
not
substantially impair the respective benefits or expectations of
the
parties; provided, however, that this severability provision shall
not be
applicable if any provision of Section 2, 5, 6, or 13 (or any definition
or provision in Section 14 to the extent it relates to, or is used
in or
in connection with any such Section) shall be so held to be invalid
or
unenforceable.
|
The
parties shall endeavor to engage in good faith negotiations to replace any
invalid or unenforceable term, provision, covenant or condition with a valid
or
enforceable term, provision, covenant or condition, the economic effect of
which
comes as close as possible to that of the invalid or unenforceable term,
provision, covenant or condition.
|
(p)
|
Agent
for Party B. Party
A acknowledges that the Depositor has appointed
the Supplemental Interest Trust Trustee
and the Securities Administrator as its agents under the Pooling
and
Servicing Agreement to carry out certain functions on behalf of
Party B,
and that the Supplemental Interest Trust Trustee and Securities
Administrator shall be entitled to give notices and to perform
and satisfy
the obligations of Party B hereunder on behalf of Party
B.
|
|
(q)
|
Escrow
Payments.
If
(whether by reason of the time difference between the cities in
which
payments are to be made or otherwise) it is not possible for simultaneous
payments to be made on any date on which both parties are required
to make
payments hereunder, either Party may at its option and in its sole
discretion notify the other Party that payments on that date are
to be
made in escrow. In this case deposit of the payment due earlier
on that
date shall be made by 2:00 pm (local time at the place for the
earlier
payment) on that date with an escrow agent selected by the notifying
party, accompanied by irrevocable payment instructions (i) to release
the
deposited payment to the intended recipient upon receipt by the
escrow
agent of the required deposit of any corresponding payment payable
by the
other party on the same date accompanied by irrevocable payment
instructions to the same effect or (ii) if the required deposit
of the
corresponding payment is not made on that same date, to return
the payment
deposited to the party that paid it into escrow. The party that
elects to
have payments made in escrow shall pay all costs of the escrow
arrangements.
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Global
No. N594309N
Page 19
of 27
|
(r)
|
Consent
to Recording.
Each party hereto consents to the monitoring or recording, at any
time and
from time to time, by the other party of any and all communications
between trading, marketing, and operations personnel of the parties
and
their Affiliates, waives any further notice of such monitoring
or
recording, and agrees to notify such personnel of such monitoring
or
recording.
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|
(s)
|
Waiver
of Jury Trial.
Each party waives any right it may have to a trial by jury in respect
of
any in respect of any suit, action or proceeding relating to this
Agreement or any Credit Support Document.
|
|
(t)
|
Form
of ISDA Master Agreement. Party
A and Party B hereby agree that the text of the body of the ISDA
Master
Agreement is intended to be the printed form of the ISDA Master
Agreement
(Multicurrency -
Crossborder) as published and copyrighted in 1992 by the International
Swaps and Derivatives Association,
Inc.
|
|
(u)
|
Payment
Instructions.
Party A hereby agrees that, unless notified in writing by Party
B of other
payment instructions, any and all amounts payable by Party A to
Party B
under this Agreement shall be paid to the account specified in
Item 4 of
this Confirmation, below.
|
|
(v)
|
Additional
representations.
|
|
(i)
|
Representations
of Party A.
Party A represents to Party B on the date on which Party A enters
into
each Transaction that:--
|
Party
A’s
obligations under this Agreement rank pari passu with all of Party A’s other
unsecured, unsubordinated obligations except those obligations preferred
by
operation of law.
|
(ii)
|
Capacity.
Party A represents to Party B on the date on which Party A enters
into
this Agreement that it is entering into the Agreement and the Transaction
as principal and not as agent of any person. The Supplemental Interest
Trust Trustee represents to Party A on the date on which the Supplemental
Interest Trust Trustee executes this Agreement that it is executing
the
Agreement in its capacity as the Supplemental Interest Trust Trustee
pursuant to the Pooling and Servicing
Agreement.
|
|
(w)
|
Acknowledgements.
|
|
(i)
|
Substantial
financial transactions.
Each party hereto is hereby advised and acknowledges as of the
date hereof
that the other party has engaged in (or refrained from engaging
in)
substantial financial transactions and has taken (or refrained
from
taking) other material actions in reliance upon the entry by the
parties
into the Transaction being entered into on the terms and conditions
set
forth herein and in the Pooling and Servicing Agreement relating
to such
Transaction, as applicable. This paragraph shall be deemed repeated
on the
trade date of each Transaction.
|
|
(ii)
|
Bankruptcy
Code.
Subject to Part 5(m), without limiting the applicability if any,
of any
other provision of the U.S. Bankruptcy Code as amended (the “Bankruptcy
Code”) (including without limitation Sections 362, 546, 556, and 560
thereof and the applicable definitions in Section 101 thereof),
the
parties acknowledge and agree that all Transactions entered into
hereunder
will constitute “forward contracts” or “swap agreements” as defined in
Section 101 of the Bankruptcy Code or “commodity contracts” as defined in
Section 761 of the Bankruptcy Code, that the rights of the parties
under
Section 6 of this Agreement will constitute contractual rights
to
liquidate Transactions, that any margin or collateral provided
under any
margin, collateral, security, pledge, or similar agreement related
hereto
will constitute a “margin payment” as defined in Section 101 of the
Bankruptcy Code, and that the parties are entities entitled to
the rights
under, and protections afforded by, Sections 362, 546, 556, and
560 of the
Bankruptcy Code.
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|
(x)
|
[Reserved]
|
|
(y)
|
[Reserved]
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Global
No. N594309N
Page 20
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|
(z)
|
Additional
Definitions.
|
As
used
in this Agreement, the following terms shall have the meanings set forth
below,
unless the context clearly requires otherwise:
“Approved
Ratings Threshold”
means
each of the S&P Approved Ratings Threshold and the Moody’s First Trigger
Ratings Threshold.
“Approved
Replacement” means,
with respect to a Market Quotation, an entity making such Market Quotation,
which entity would satisfy conditions (a), (b), (c) and (e) of the definition
of
Permitted Transfer (as determined by Party B in its sole discretion, acting
in a
commercially reasonable manner) if such entity were a Transferee, as defined
in
the definition of Permitted Transfer.
“Derivative
Provider Trigger Event”
means
(i) an Event of Default with respect to which Party A is a Defaulting Party,
(ii) a Termination Event with respect to which Party A is the sole Affected
Party or (iii) an Additional Termination Event with respect to which Party
A is
the sole Affected Party.
“Eligible
Guarantee”
means an
unconditional and irrevocable guarantee of all present and future obligations
(for the avoidance of doubt, not limited to payment obligations) of Party
A or
an Eligible Replacement to Party B under this Agreement that is provided
by an
Eligible Guarantor as principal debtor rather than surety and that is directly
enforceable by Party B, the form and substance of which guarantee are subject
to
the Rating Agency Condition with respect to S&P, and either (A) a law firm
has given a legal opinion confirming that none of the guarantor’s payments to
Party B under such guarantee will be subject to Tax
collected by withholding or
(B)
such guarantee provides that, in the event that any of such guarantor’s payments
to Party B are subject to Tax collected by withholding, such guarantor is
required to pay such additional amount as is necessary to ensure that the
net
amount actually received by Party B (free and clear of any Tax collected
by
withholding) will equal the full amount Party B would have received had no
such
withholding been required.
“Eligible
Guarantor” means
an
entity that (A) has credit ratings from S&P at least equal to the S&P
Approved Ratings Threshold and (B) has credit ratings from Moody’s at least
equal to the Moody’s Second Trigger Ratings Threshold, provided, for the
avoidance of doubt, that an Eligible Guarantee of an Eligible Guarantor with
credit ratings below the Moody’s First Trigger Ratings Threshold will not cause
a Collateral Event (as defined in the Credit Support Annex) not to occur
or
continue with respect to Moody’s.
“Eligible
Replacement”
means an
entity (A) (i) (a) that has credit ratings from S&P at least equal to the
S&P Approved Ratings Threshold, and (b) has credit ratings from Moody’s at
least equal to the Moody’s Second Trigger Ratings Threshold, provided, for the
avoidance of doubt, that an Eligible Replacement with credit ratings below
the
Moody’s First Trigger Ratings Threshold will not cause a Collateral Event (as
defined in the Credit Support Annex) not to occur or continue with respect
to
Moody’s, or (ii) the present and future obligations (for the avoidance of doubt,
not limited to payment obligations) of which entity to Party B under this
Agreement are guaranteed pursuant to an Eligible Guarantee and (B) that has
executed an Item 1115 Agreement with the Depositor.
“Estimated
Swap Termination Payment”
means,
with respect to an Early Termination Date, an amount determined by Party
A in
good faith and in a commercially reasonable manner as the maximum payment
that
could be owed by Party B to Party A in respect of such Early Termination
Date
pursuant to Section 6(e) of the ISDA Master Agreement, taking into account
then
current market conditions.
“Firm
Offer”
means
(A) with respect to an Eligible Replacement, a quotation from such Eligible
Replacement (i) in an amount equal to the actual amount payable by or to
Party B
in consideration of an agreement between Party B and such Eligible Replacement
to replace Party A as the counterparty to this Agreement by way of novation
or,
if such novation is not possible, an agreement between Party B and such Eligible
Replacement to enter into a Replacement Transaction (assuming that all
Transactions hereunder become Terminated Transactions), and (ii) that
constitutes an offer by such Eligible Replacement to replace Party A as the
counterparty to this Agreement or enter a Replacement Transaction that will
become legally binding upon such Eligible Replacement upon acceptance by
Party
B, and (B) with respect to an Eligible Guarantor, an offer by such Eligible
Guarantor to provide an Eligible Guarantee that will become legally binding
upon
such Eligible Guarantor upon acceptance by the offeree.
Global
No. N594309N
Page 21
of 27
“Moody’s”
means
Xxxxx’x Investors Service, Inc., or any successor thereto.
“Moody’s
First Trigger Ratings Event” means
that no Relevant Entity has credit ratings from Moody’s at least equal to the
Moody’s First Trigger Ratings Threshold.
“Moody’s
First Trigger Ratings
Threshold” means,
with respect to Party A, the guarantor under an Eligible Guarantee or an
Eligible Replacement, (i) if such entity has a short-term unsecured and
unsubordinated debt rating from Moody’s, a long-term unsecured and
unsubordinated debt rating or counterparty rating from Moody’s of “A2” and a
short-term unsecured and unsubordinated debt rating from Moody’s of “Prime-1”,
or (ii) if such entity does not have a short-term unsecured and unsubordinated
debt rating or counterparty rating from Moody’s, a long-term unsecured and
unsubordinated debt rating or counterparty rating from Moody’s of
“A1”.
“Moody’s
Second Trigger Ratings Event” means
that no
Relevant Entity has credit ratings from Moody’s at least equal to the Moody’s
Second Trigger Ratings Threshold.
“Moody’s
Second Trigger Ratings Threshold” means,
with respect to Party A, the guarantor under an Eligible Guarantee or an
Eligible Replacement, (i) if such entity has a short-term unsecured and
unsubordinated debt rating from Moody’s, a long-term unsecured and
unsubordinated debt rating or counterparty rating from Moody’s of “A3” and a
short-term unsecured and unsubordinated debt rating from Moody’s of “Prime-2”,
or (ii) if such entity does not have a short-term unsecured and unsubordinated
debt rating from Moody’s, a long-term unsecured and unsubordinated debt rating
or counterparty rating from Moody’s of “A3”.
“Permitted
Transfer” means
a
transfer by novation by Party A pursuant to Section 6(b)(ii), Part 5(d),
Part
5(e), or the second sentence of Section 7 (as amended herein) to a transferee
(the “Transferee”)
of all,
but not less than all, of Party A’s rights, liabilities, duties and obligations
under this Agreement, with
respect to which transfer each of the following conditions is
satisfied:
(a) the
Transferee is an Eligible Replacement that is a recognized dealer in interest
rate swaps organized under the laws of the United States of America or a
jurisdiction located in the United States of America (or another jurisdiction
reasonably acceptable to Party B), (b) as of the date of such transfer the
Transferee would not be required to withhold or deduct on account of Tax
from
any payments under this Agreement or would be required to gross up for such
Tax
under Section 2(d)(i)(4), (c) an Event of Default or Termination Event would
not
occur as a result of such transfer, (d) Party B has consented in writing
to the
transfer, such consent not to be unreasonably withheld, (e) the transfer
would
not give rise to a taxable event or any other adverse Tax consequences to
Party
B or its interest holders, as determined by Party B in its sole discretion,
(f)
pursuant to a written instrument (the “Transfer
Agreement”),
the
Transferee acquires and assumes all rights and obligations of Party A under
the
Agreement and the relevant Transaction, (g) Party B shall have determined,
in
its sole discretion, acting in a commercially reasonable manner, that such
Transfer Agreement is effective to transfer to the Transferee all, but not
less
than all, of Party A’s rights and obligations under the Agreement and all
relevant Transactions; (h) Party A will be responsible for any costs or expenses
incurred in connection with such transfer (including any replacement cost
of
entering into a replacement transaction); (i) either (A) Moody’s has been given
prior written notice of such transfer and the Rating Agency Condition is
satisfied with respect to S&P or (B) each Swap Rating Agency has been given
prior written notice of such transfer and such transfer is in connection
with
the assignment and assumption of this Agreement without modification of its
terms, other than party names, dates relevant to the effective date of such
transfer, tax representations (provided that the representations in Part
2(a)(i)
are not modified) and any other representations regarding the status of the
substitute counterparty of the type included in Part 5(b)(iv), Part 5(v)(i)(2)
or Part 5(v)(ii), notice information and account details; and (j) such transfer
otherwise complies with the terms of the Pooling and Servicing
Agreement.
Global
No. N594309N
Page 22
of 27
“Rating
Agency Condition”
means,
with respect to any particular proposed act or omission to act hereunder
and
each Swap Rating Agency specified in connection with such proposed act or
omission, that the party acting or failing to act must consult with each
of the
specified Swap Rating Agencies and receive from each such Swap Rating Agency
a
prior written confirmation that the proposed action or inaction would not
cause
a downgrade or withdrawal of the then-current rating of any Certificates
or
Notes.
“Relevant
Entity” means
Party A and, to the extent applicable, a guarantor under an Eligible
Guarantee.
“Replacement
Transaction”
means,
with respect to any Terminated Transaction or group of Terminated Transactions,
a transaction or group of transactions that (i) would have the effect of
preserving for Party B the economic equivalent of any payment or delivery
(whether the underlying obligation was absolute or contingent and assuming
the
satisfaction of each applicable condition precedent) by the parties under
Section 2(a)(i) in respect of such Terminated Transaction or group of Terminated
Transactions that would, but for the occurrence of the relevant Early
Termination Date, have been required after that Date, and (ii) has terms
which
are substantially the same as this Agreement, including, without limitation,
rating triggers, Regulation AB compliance, and credit support documentation,
save for the exclusion of provisions relating to Transactions that are not
Terminated Transactions, as determined by Party B in its sole discretion,
acting
in a commercially reasonable manner.
“Required
Ratings Downgrade Event”
means
that no Relevant Entity has credit ratings at least equal to the Required
Ratings Threshold.
“Required
Ratings Threshold” means
each of the S&P Required Ratings Threshold and the Moody’s Second Trigger
Ratings Threshold.
“S&P”
means
Standard & Poor's Rating Services, a division of The XxXxxx-Xxxx Companies,
Inc., or any successor thereto.
“S&P
Approved Ratings Threshold”
means,
with respect to Party A, the guarantor under an Eligible Guarantee or an
Eligible Replacement, a short-term unsecured and unsubordinated debt rating
from
S&P of “A-1”, or, if such entity does not have a short-term unsecured and
unsubordinated debt rating from S&P, a long-term unsecured and
unsubordinated debt rating or counterparty rating from S&P of
“A+”.
“S&P
Required Ratings Threshold”
means,
with respect to Party A, the guarantor under an Eligible Guarantee or an
Eligible Replacement, a long-term unsecured and unsubordinated debt rating
or
counterparty rating from S&P of “BBB+”.
“Swap
Rating Agencies”
means,
with respect to any date of determination, each of S&P and Xxxxx’x, to the
extent that each such rating agency is then providing a rating for any of
the
ACE Securities Corp. Home Equity Loan Trust, Series 2007-WM2 Asset Backed
Pass-Through Certificates (the “Certificates”) or any notes backed by the
Certificates (the “Notes”).
[Remainder
of this page intentionally left blank.]
Page 23
of 27
|
4.
|
Account
Details and Settlement Information:
|
|
Payments
to Party A:
|
Account
with bank:
|
|
DB
Trust Co Americas
|
|
|
ABA
000000000
|
|
|
XXXXXX00
|
|
|
Beneficiary:
|
|
|
Deutsche
Bank AG New York
|
|
|
a/c:
01473969
|
|
|
Global
No. N563169N
|
|
|
Payments
to Party B:
|
Xxxxx
Fargo Bank, NA
|
|
ABA
# 000000000
|
|
|
Account
Name: SAS Clearing Account #0000000000
|
|
|
FCC
to: 50999902, ACE 07-WM2 Supplemental Interest
Trust
|
This
Agreement may be executed in several counterparts, each of which shall be
deemed
an original but all of which together shall constitute one and the same
instrument.
Global No. N594309N
Page 24
of 27
We
are
very pleased to have executed this Transaction with you and we look forward
to
completing other transactions with you in the near future.
Very
truly yours,
DEUTCSHE
BANK AG, NEW YORK BRANCH
|
By:
|
/s/:
Xxxxxxxxxxx Xxxxxxxx
|
/s/:
Xxxxxxxxxxx Xxxxxxx
|
|
Xxxxxxxxxxx
Xxxxxxxx
|
Xxxxxxxxxxx
Xxxxxxx
|
|
|
Authorized
Signatory
|
Authorized
Signatory
|
Party
B,
acting through its duly authorized signatory, hereby agrees to, accepts and
confirms the terms of the foregoing as of the date hereof.
HSBC
Bank USA, National Association, not in its individual capacity, but solely
as
Supplemental Interest Trust Trustee for the Supplemental Interest Trust with
respect to Ace Securities Corp. Home Equity Loan Trust, Series 2007-WM2 Asset
Backed Pass-Through Certificates
By:
/s/:
Xxxxxxxx Xxxxxxx
Xxxxxxxx Xxxxxxx
Vice President
Global No. N594309N
Page 25
of 27
SCHEDULE
I
(all
such
dates subject to No Adjustment with respect to Fixed Rate Payer Period End
Dates
and adjustment in accordance with the Following Business Day Convention with
respect to Floating Rate Payer Period End Dates)
|
From
and including
|
To
but excluding
|
Notional
Amount (USD)
|
|
Effective
Date
|
10/25/2007
|
666,415,204.00
|
|
10/25/2007
|
11/25/2007
|
643,170,595.00
|
|
11/25/2007
|
12/25/2007
|
618,333,656.00
|
|
12/25/2007
|
1/25/2008
|
592,182,982.00
|
|
1/25/2008
|
2/25/2008
|
567,111,935.00
|
|
2/25/2008
|
3/25/2008
|
543,075,775.00
|
|
3/25/2008
|
4/25/2008
|
520,031,625.00
|
|
4/25/2008
|
5/25/2008
|
497,938,388.00
|
|
5/25/2008
|
6/25/2008
|
476,756,676.00
|
|
6/25/2008
|
7/25/2008
|
456,448,739.00
|
|
7/25/2008
|
8/25/2008
|
436,978,395.00
|
|
8/25/2008
|
9/25/2008
|
418,310,965.00
|
|
9/25/2008
|
10/25/2008
|
400,371,355.00
|
|
10/25/2008
|
11/25/2008
|
383,178,704.00
|
|
11/25/2008
|
12/25/2008
|
364,967,665.00
|
|
12/25/2008
|
1/25/2009
|
309,569,380.00
|
|
1/25/2009
|
2/25/2009
|
263,493,321.00
|
|
2/25/2009
|
3/25/2009
|
225,077,617.00
|
|
3/25/2009
|
4/25/2009
|
193,763,410.00
|
|
4/25/2009
|
5/25/2009
|
184,421,749.00
|
|
5/25/2009
|
6/25/2009
|
175,501,123.00
|
|
6/25/2009
|
7/25/2009
|
166,982,263.00
|
|
7/25/2009
|
8/25/2009
|
158,848,514.00
|
|
8/25/2009
|
9/25/2009
|
151,080,372.00
|
|
9/25/2009
|
10/25/2009
|
143,661,112.00
|
|
10/25/2009
|
11/25/2009
|
136,574,794.00
|
|
11/25/2009
|
12/25/2009
|
129,806,201.00
|
|
12/25/2009
|
1/25/2010
|
123,340,846.00
|
|
1/25/2010
|
2/25/2010
|
117,165,338.00
|
|
2/25/2010
|
3/25/2010
|
111,265,985.00
|
|
3/25/2010
|
4/25/2010
|
105,630,211.00
|
|
4/25/2010
|
5/25/2010
|
100,246,020.00
|
|
5/25/2010
|
6/25/2010
|
95,101,971.00
|
|
6/25/2010
|
7/25/2010
|
90,187,153.00
|
|
7/25/2010
|
8/25/2010
|
85,491,191.00
|
|
8/25/2010
|
9/25/2010
|
81,004,119.00
|
|
9/25/2010
|
10/25/2010
|
76,716,464.00
|
|
10/25/2010
|
11/25/2010
|
72,619,195.00
|
|
11/25/2010
|
12/25/2010
|
68,703,692.00
|
|
12/25/2010
|
1/25/2011
|
64,961,734.00
|
|
1/25/2011
|
2/25/2011
|
61,385,480.00
|
|
2/25/2011
|
3/25/2011
|
57,967,444.00
|
|
3/25/2011
|
4/25/2011
|
54,700,488.00
|
|
4/25/2011
|
5/25/2011
|
51,577,799.00
|
Global No. N594309N
Page 26
of 27
|
5/25/2011
|
6/25/2011
|
48,592,878.00
|
|
6/25/2011
|
7/25/2011
|
45,739,525.00
|
|
7/25/2011
|
8/25/2011
|
43,011,821.00
|
|
8/25/2011
|
9/25/2011
|
40,404,121.00
|
|
9/25/2011
|
10/25/2011
|
37,911,037.00
|
|
10/25/2011
|
11/25/2011
|
35,527,425.00
|
|
11/25/2011
|
12/25/2011
|
33,248,380.00
|
|
12/25/2011
|
1/25/2012
|
31,068,847.00
|
|
1/25/2012
|
2/25/2012
|
28,983,740.00
|
|
2/25/2012
|
Termination
Date
|
26,989,900.00
|
Global No. N594309N
Page 27
of 27
Annex
A
Paragraph
13 of the Credit Support Annex
ANNEX
A
ISDA®
CREDIT
SUPPORT ANNEX
to
the
Schedule to the
ISDA
Master Agreement
dated
as
of March 30, 2007
between
Deutsche
Bank AG (hereinafter referred to as “Party
A”
or
“Pledgor”)
And
HSBC
Bank USA, National Association, not in its individual capacity, but solely
as
Supplemental Interest Trust Trustee for the Supplemental Interest Trust with
respect to ACE Securities Corp. Home Equity Loan Trust, Series 2007-WM2 Asset
Backed Pass-Through Certificates
(hereinafter
referred to as “Party
B”
or
“Secured
Party”).
For
the
avoidance of doubt, and notwithstanding anything to the contrary that may
be
contained in the Agreement, this Credit Support Annex shall relate solely
to the
Transaction documented in the Confirmation dated March 30, 2007, between
Party A
and Party B, Global No. N594309N.
Paragraph
13. Elections and Variables.
|
(a)
|
Security
Interest for “Obligations”.
The term “Obligations”
as
used in this Annex includes the following additional
obligations:
|
With
respect to Party A: not applicable.
With
respect to Party B: not applicable.
|
(b)
|
Credit
Support Obligations.
|
|
(i)
|
Delivery
Amount, Return Amount and Credit Support
Amount.
|
|
(A)
|
“Delivery
Amount”
has the meaning specified in Paragraph 3(a) as amended (I) by deleting
the
words “upon a demand made by the Secured Party on or promptly following
a
Valuation Date” and inserting in lieu thereof the words “not later than
the close of business on each Valuation Date” and (II) by deleting in its
entirety the sentence beginning “Unless otherwise specified in Paragraph
13” and ending “(ii) the Value as of that Valuation Date of all Posted
Credit Support held by the Secured Party.” and inserting in lieu thereof
the following:
|
The
“Delivery
Amount”
applicable to the Pledgor for any Valuation Date will equal the greatest
of
|
(1)
|
the
amount by which (a) the S&P Credit Support Amount for such Valuation
Date exceeds (b) the S&P Value as of such Valuation Date of all Posted
Credit Support held by the Secured Party,
|
Global No. N594309N
|
(2)
|
the
amount by which (a) the Xxxxx’x First Trigger Credit Support Amount for
such Valuation Date exceeds (b) the Xxxxx’x First Trigger Value as of such
Valuation Date of all Posted Credit Support held by the Secured
Party,
and
|
|
(3)
|
the
amount by which (a) the Xxxxx’x Second Trigger Credit Support Amount for
such Valuation Date exceeds (b) the Xxxxx’x Second Trigger Value as of
such Valuation Date of all Posted Credit Support held by the Secured
Party.
|
|
(B)
|
“Return
Amount”
has the meaning specified in Paragraph 3(b) as amended by deleting
in its
entirety the sentence beginning “Unless otherwise specified in Paragraph
13” and ending “(ii) the Credit Support Amount.” and inserting in lieu
thereof the following:
|
The
“Return
Amount”
applicable to the Secured Party for any Valuation Date will equal the least
of
|
(1)
|
the
amount by which (a) the S&P Value as of such Valuation Date of all
Posted Credit Support held by the Secured Party exceeds (b) the
S&P
Credit Support Amount for such Valuation Date,
|
|
(2)
|
the
amount by which (a) the Xxxxx’x First Trigger Value as of such Valuation
Date of all Posted Credit Support held by the Secured Party exceeds
(b)
the Xxxxx’x First Trigger Credit Support Amount for such Valuation Date,
and
|
|
(3)
|
the
amount by which (a) the Xxxxx’x Second Trigger Value as of such Valuation
Date of all Posted Credit Support held by the Secured Party exceeds
(b)
the Xxxxx’x Second Trigger Credit Support Amount for such Valuation
Date.
|
|
(C)
|
“Credit
Support Amount”
shall not apply. For purposes of calculating any Delivery Amount
or Return
Amount for any Valuation Date, reference shall be made to the S&P
Credit Support Amount, the Xxxxx’x First Trigger Credit Support Amount, or
the Xxxxx’x Second Trigger Credit Support Amount, in each case for such
Valuation Date, as provided in Paragraphs 13(b)(i)(A) and 13(b)(i)(B),
above.
|
|
(ii)
|
Eligible
Collateral.
|
On
any
date, the following items will qualify as “Eligible
Collateral”
(for
the avoidance of doubt, all Eligible Collateral to be denominated in
USD):
2
Global No. N594309N
|
Collateral
|
S&P
Valuation
Percentage
|
Xxxxx’x
First
Trigger Valuation
Percentage
|
Xxxxx’x
Second
Trigger
Valuation
Percentage
|
|
(A) Cash
|
100%
|
100%
|
100%
|
|
(B)
Fixed-rate
negotiable debt obligations issued by the U.S. Treasury Department
having
a remaining maturity on such date of not more than one
year
|
98.5%
|
100%
|
100%
|
|
(C)
Fixed-rate
negotiable debt obligations issued by the U.S. Treasury Department
having
a remaining maturity on such date of more than one year but not
more than
ten years
|
89.9%
|
100%
|
94%
|
|
(D)
Fixed-rate
negotiable debt obligations issued by the U.S. Treasury Department
having
a remaining maturity on such date of more than ten years
|
83.9%
|
100%
|
87%
|
|
(iii)
|
Other
Eligible Support.
|
The
following items will qualify as “Other
Eligible Support”
for the
party specified:
Not
applicable.
|
(iv)
|
Threshold.
|
|
(A)
|
“Independent
Amount”
means zero with respect to Party A and Party
B.
|
|
(B)
|
“Threshold”
means, with respect to Party A and any Valuation Date, zero if
(i) a
Collateral Event has occurred and has been continuing (x) for at
least 30
days or (y) since this Annex was executed, or (ii) a Required Ratings
Downgrade Event has occurred and is continuing; otherwise,
infinity.
|
“Threshold”
means,
with respect to Party B and any Valuation Date, infinity.
|
(C)
|
“Minimum
Transfer Amount” means
USD 100,000 with respect to Party A and Party B; provided, however,
that
if the aggregate Certificate Principal Balance of the Certificates
and the
aggregate principal balance of any Notes rated by S&P is at the time
of any transfer less than USD 50,000,000, the “Minimum
Transfer Amount”
shall be USD 50,000.
|
3
Global No. N594309N
|
(D)
|
Rounding:
The Delivery Amount will be rounded up to the nearest integral
multiple of
USD 10,000. The Return Amount will be rounded down to the nearest
integral
multiple of USD 10,000.
|
|
(c)
|
Valuation
and Timing.
|
|
(i)
|
“Valuation
Agent”
means Party A; provided, however, that if an Event of Default shall
have
occurred with respect to which Party A is the Defaulting Party,
Party B
shall have the right to designate as Valuation Agent an independent
party,
reasonably acceptable to Party A, the cost for which shall be borne
by
Party A. All calculations by the Valuation Agent must be made in
accordance with standard market practice, including, in the event
of a
dispute as to the Value of any Eligible Credit Support or Posted
Credit
Support, by making reference to quotations received by the Valuation
Agent
from one or more Pricing Sources.
|
|
(ii)
|
“Valuation
Date” means
the first Local Business Day in each week on which any of the S&P
Credit Support Amount, the Xxxxx’x First Trigger Credit Support Amount or
the Xxxxx’x Second Trigger Credit Support Amount is greater than
zero.
|
|
(iii)
|
“Valuation
Time” means
the close of business in the city of the Valuation Agent on the
Local
Business Day immediately preceding the Valuation Date or date of
calculation, as applicable; provided
that the calculations of Value and Exposure will be made as of
approximately the same time on the same date.
|
|
(iv)
|
“Notification
Time” means
11:00 a.m., New York time, on a Local Business Day.
|
|
(v)
|
External
Verification.
Notwithstanding anything to the contrary in the definitions of
Valuation
Agent or Valuation Date, at any time at which Party A (or, to the
extent
applicable, its Credit Support Provider) does not have a long-term
unsubordinated and unsecured debt rating of at least “BBB+” from S&P,
the Valuation Agent shall (A) calculate the Secured Party’s Exposure and
the S&P Value of Posted Credit Support on each Valuation Date based on
internal marks and (B) verify such calculations with external marks
monthly by obtaining on the last Local Business Day of each calendar
month
two external marks for each Transaction to which this Annex relates
and
for all Posted Credit Support; such verification of the Secured
Party’s
Exposure shall be based on the higher of the two external marks.
Each
external xxxx in respect of a Transaction shall be obtained from
an
independent Reference Market-maker that would be eligible and willing
to
enter into such Transaction in the absence of the current derivative
provider, provided that an external xxxx xxx not be obtained from
the same
Reference Market-maker more than four times in any 12-month period.
The
Valuation Agent shall obtain these external marks directly or through
an
independent third party, in either case at no cost to Party B.
The
Valuation Agent shall calculate on each Valuation Date (for purposes
of
this paragraph, the last Local Business Day in each calendar month
referred to above shall be considered a Valuation Date) the Secured
Party’s Exposure based on the greater of the Valuation Agent’s internal
marks and the external marks received. If the S&P Value on any such
Valuation Date of all Posted Credit Support then held by the Secured
Party
is less than the S&P Credit Support Amount on such Valuation Date (in
each case as determined pursuant to this paragraph), Party A shall,
within
three Local Business Days of such Valuation Date, Transfer to the
Secured
Party Eligible Credit Support having an S&P Value as of the date of
Transfer at least equal to such deficiency.
|
|
(vi)
|
Notice
to S&P.
At
any time at which Party A (or, to the extent applicable, its Credit
Support Provider) does not have a long-term unsubordinated and
unsecured
debt rating of at least “BBB+” from S&P, the Valuation Agent shall
provide to S&P not later than the Notification Time on the Local
Business Day following each Valuation Date its calculations of
the Secured
Party’s Exposure and the S&P Value of any Eligible Credit Support or
Posted Credit Support for that Valuation Date. The Valuation Agent
shall
also provide to S&P any external marks received pursuant to the
preceding paragraph.
|
4
Global
No. N594309N
|
(d)
|
Conditions
Precedent and Secured Party’s Rights and
Remedies.
The following Termination Events will be a “Specified
Condition”
for the party specified (that party being the Affected Party if
the
Termination Event occurs with respect to that party): With respect
to
Party A: any Additional Termination Event with respect to which
Party A is
the sole Affected Party. With respect to Party B:
None.
|
|
(e)
|
Substitution.
|
|
(i)
|
“Substitution
Date”
has the meaning specified in Paragraph
4(d)(ii).
|
|
(ii)
|
Consent.
If
specified here as applicable, then the Pledgor must obtain the
Secured
Party’s consent for any substitution pursuant to Paragraph 4(d):
Inapplicable.
|
|
(f)
|
Dispute
Resolution.
|
|
(i)
|
“Resolution
Time”
means 1:00 p.m. New York time on the Local Business Day following
the date
on which the notice of the dispute is given under Paragraph
5.
|
|
(ii)
|
Value.
Notwithstanding anything to the contrary in Paragraph 12, for the
purpose
of Paragraphs 5(i)(C) and 5(ii), the S&P Value, Xxxxx’x First Trigger
Value, and Xxxxx’x Second Trigger Value, on any date, of Eligible
Collateral other than Cash will be calculated as follows:
|
For
Eligible Collateral in the form of securities listed in Paragraph 13(b)(ii):
the
sum of (A) the product of (1)(x) the bid price at the Valuation Time for
such
securities on the principal national securities exchange on which such
securities are listed, or (y) if such securities are not listed on a national
securities exchange, the bid price for such securities quoted at the Valuation
Time by any principal market maker for such securities selected by the Valuation
Agent, or (z) if no such bid price is listed or quoted for such date, the
bid
price listed or quoted (as the case may be) at the Valuation Time for the
day
next preceding such date on which such prices were available and (2) the
applicable Valuation Percentage for such Eligible Collateral, and (B) the
accrued interest on such securities (except to the extent Transferred to
the
Pledgor pursuant to Paragraph 6(d)(ii) or included in the applicable price
referred to in the immediately preceding clause (A)) as of such
date.
|
(iii)
|
Alternative.
The provisions of Paragraph 5 will
apply.
|
|
(g)
|
Holding
and Using Posted
Collateral.
|
|
(i)
|
Eligibility
to Hold Posted Collateral; Custodians. Party
B (or any Custodian) will be entitled to hold Posted Collateral
pursuant
to Paragraph 6(b).
|
Party
B
may appoint as Custodian (A) the entity then serving as Securities Administrator
or (B) any entity other than the entity then serving as Securities Administrator
if such other entity (or, to the extent applicable, its parent company or
credit
support provider) shall then have a short-term unsecured and unsubordinated
debt
rating from S&P of at least “A-1.”
5
Global No. N594309N
Initially,
the Custodian
for
Party B is: Securities Administrator
|
(ii)
|
Use
of Posted Collateral. The
provisions of Paragraph 6(c)(i) will not apply to Party B, but
the
provisions of Paragraph 6(c)(ii) will apply to Party B or its Custodian.
Posted
Collateral in the form of Cash shall be invested in such overnight
(or
redeemable within two Local Business Days of demand) Permitted
Investments
rated at least (x) AAAm or AAAm-G by S&P and (y) Prime-1 by Xxxxx’x or
Aaa by Xxxxx’x, as directed by Party A (unless (x) an Event of Default or
an Additional Termination Event has occurred with respect to which
Party A
is the defaulting or sole Affected Party or (y) an Early Termination
Date
has been designated, in which case such Posted Collateral shall
be held
uninvested). Gains and losses incurred in respect of any investment
of
Posted Collateral in the form of Cash in Permitted Investments
as directed
by Party A shall be for the account of Party A. If no investment
direction
is received, the Posted Collateral in the form of Cash shall be
held
uninvested.
|
|
(h)
|
Distributions
and Interest Amount.
|
|
(i)
|
Interest
Rate.
The “Interest
Rate”
will be the actual interest rate earned on Posted Collateral in
the form
of Cash that is held by Party B or its
Custodian.
|
|
(ii)
|
Transfer
of Interest Amount.
The Transfer of the Interest Amount will be made on the second
Local
Business Day following the end of each calendar month and on any
other
Local Business Day on which Posted Collateral in the form of Cash
is
Transferred to the Pledgor pursuant to Paragraph 3(b); provided,
however,
that the obligation of Party B to Transfer any Interest Amount
to Party A
shall be limited to the extent that Party B has earned and received
such
funds and such funds are available to Party B.
|
|
(iii)
|
Alternative
to Interest Amount.
The provisions of Paragraph 6(d)(ii) will
apply.
|
|
(i)
|
Additional
Representation(s).
There are no additional representations by either
party.
|
|
(j)
|
Other
Eligible Support and Other Posted Support.
|
|
(i)
|
“Value”
with respect to Other Eligible Support and Other Posted Support
means: not
applicable.
|
|
(ii)
|
“Transfer”
with respect to Other Eligible Support and Other Posted Support
means: not
applicable.
|
|
(k)
|
Demands
and Notices.All
demands, specifications and notices under this Annex will be made
pursuant
to the Notices Section of this Agreement, except that any demand,
specification or notice shall be given to or made at the following
addresses, or at such other address as the relevant party may from
time to
time designate by giving notice (in accordance with the terms of
this
paragraph) to the other party:
|
If
to
Party A, at the address specified pursuant to the Notices Section of this
Agreement.
If
to
Party B, at the address specified pursuant to the Notices Section of this
Agreement.
If
to
Party B’s Custodian:
Address: Xxxxx
Fargo Bank, N.A.
0000
Xxx
Xxxxxxxxx Xxxx
Xxxxxxxx,
XX 00000
Attention: Client
Manager Ace 2007-WM2
Tel: 000-000-0000
Fax: 000-000-0000
6
Global No. N594309N
|
(l)
|
Address
for Transfers.
Each Transfer hereunder shall be made to the address specified
below or to
an address specified in writing from time to time by the party
to which
such Transfer will be made.
|
Party
A
account details for holding collateral: to be provided by Party A in
writing.
Party
B’s
Custodian account details for holding collateral:
Xxxxx
Fargo Bank, NA
ABA
000000000
Account
Name: SAS Clearing Account #0000000000
FFC
to
50999903, ACE 07-WM2 Swap Collateral Account
|
(m)
|
Other
Provisions.
|
|
(i)
|
Collateral
Account.
Party B shall open and maintain a segregated account, which shall
be an
Eligible Account, and hold, record and identify all Posted Collateral
in
such segregated account, in accordance with the Pooling and Servicing
Agreement.
|
|
(ii)
|
Agreement
as to Single Secured Party and Single Pledgor.
Party A and Party B hereby agree that, notwithstanding anything
to the
contrary in this Annex, (a) the term “Secured Party” as used in this Annex
means only Party B, (b) the term “Pledgor” as used in this Annex means
only Party A, (c) only Party A makes the pledge and grant in Paragraph
2,
the acknowledgement in the final sentence of Paragraph 8(a) and
the
representations in Paragraph 9.
|
|
(iii)
|
Calculation
of Value.
Paragraph 4(c) is hereby amended by deleting the word “Value” and
inserting in lieu thereof “S&P Value, Xxxxx’x First Trigger Value,
Xxxxx’x Second Trigger Value”. Paragraph 4(d)(ii) is hereby amended by (A)
deleting the words “a Value” and inserting in lieu thereof “an S&P
Value, Xxxxx’x First Trigger Value, and Xxxxx’x Second Trigger Value” and
(B) deleting the words “the Value” and inserting in lieu thereof “S&P
Value, Xxxxx’x First Trigger Value, and Xxxxx’x Second Trigger Value”.
Paragraph 5 (flush language) is hereby amended by deleting the
word
“Value” and inserting in lieu thereof “S&P Value, Xxxxx’x First
Trigger Value, or Xxxxx’x Second Trigger Value”. Paragraph 5(i) (flush
language) is hereby amended by deleting the word “Value” and inserting in
lieu thereof “S&P Value, Xxxxx’x First Trigger Value, and Xxxxx’x
Second Trigger Value”. Paragraph 5(i)(C) is hereby amended by deleting the
word “the Value, if” and inserting in lieu thereof “any one or more of the
S&P Value, Xxxxx’x First Trigger Value, or Xxxxx’x Second Trigger
Value, as may be”. Paragraph 5(ii) is hereby amended by (1) deleting the
first instance of the words “the Value” and inserting in lieu thereof “any
one or more of the S&P Value, Xxxxx’x First Trigger Value, or Xxxxx’x
Second Trigger Value” and (2) deleting the second instance of the words
“the Value” and inserting in lieu thereof “such disputed S&P Value,
Xxxxx’x First Trigger Value, or Xxxxx’x Second Trigger Value”. Each of
Paragraph 8(b)(iv)(B) and Paragraph 11(a) is hereby amended by
deleting
the word “Value” and inserting in lieu thereof “least of the S&P
Value, Xxxxx’x First Trigger Value, and Xxxxx’x Second Trigger Value”.
|
|
(iv)
|
Form
of Annex. Party
A and Party B hereby agree that the text of Paragraphs 1 through
12,
inclusive, of this Annex is intended to be the printed form of
ISDA Credit
Support Annex (Bilateral Form - ISDA Agreements Subject to New
York Law
Only version) as published and copyrighted in 1994 by the International
Swaps and Derivatives Association,
Inc.
|
7
Global No. N594309N
|
(v)
|
Events
of Default.
Paragraph 7 will not apply to cause any Event of Default to exist
with
respect to Party B except that Paragraph 7(i) will apply to Party
B solely
in respect of Party B’s obligations under Paragraph 3(b) of the Credit
Support Annex. Notwithstanding anything to the contrary in Paragraph
7,
any failure by Party A to comply with or perform any obligation
to be
complied with or performed by Party A under the Credit Support
Annex shall
only be an Event of Default if (A) Required
Ratings Downgrade Event has occurred and been continuing for 30
or more
Local Business Days, and (B) such failure is not remedied on or
before the
third Local Business Day after notice of such failure is given
to Party
A.
|
|
(vi)
|
Expenses.
Notwithstanding anything to the contrary in Paragraph 10, the Pledgor
will
be responsible for, and will reimburse the Secured Party for, all
transfer
and other taxes and other costs involved in any Transfer of Eligible
Collateral.
|
|
(vii)
|
Withholding.
Paragraph 6(d)(ii) is hereby amended by inserting immediately after “the
Interest Amount” in the fourth line thereof the words “less any applicable
withholding taxes.”
|
(viii) Additional
Definitions.
As used
in this Annex:
“Collateral
Event” means
that no Relevant Entity has credit ratings at least equal to the Approved
Ratings Threshold.
“Exposure”
has the meaning specified in Paragraph 12, except that after the word
“Agreement” the words “(assuming, for this purpose only, that Part 1(f) of the
Schedule is deleted)” shall be inserted.
“Local
Business Day”
means
for purposes of this Annex: any day on which (A) commercial banks are open
for
business (including dealings in foreign exchange and foreign currency deposits)
in New York and the location of Party A, Party B and any Custodian, and (B)
in
relation to a Transfer of Eligible Collateral, any day on which the clearance
system agreed between the parties for the delivery of Eligible Collateral
is
open for acceptance and execution of settlement instructions (or in the case
of
a Transfer of Cash or other Eligible Collateral for which delivery is
contemplated by other means a day on which commercial banks are open for
business (including dealings in foreign exchange and foreign deposits) in
New
York and the location of Party A, Party B and any Custodian.
“Xxxxx’x
First Trigger Credit Support Amount” means,
for any Valuation Date, the excess, if any, of
|
(I)
|
(A)
|
for
any Valuation Date on which (I) a Xxxxx’x First Trigger Ratings Event has
occurred and has been continuing (x) for at least 30 Local Business
Days
or (y) since this Annex was executed and (II) it is not the case
that a
Xxxxx’x Second Trigger Ratings Event has occurred and been continuing
for
at least 30 Local Business Days, an amount equal to the greater
of (a)
zero and (b) the sum of (i) the Secured Party’s Exposure for such
Valuation Date and (ii) the sum, for each Transaction to which
this Annex
relates, of the product of (i) the applicable Xxxxx’x First Trigger Factor
set forth in Table 1, (ii) the Scale Factor, if any, for such Transaction,
or, if no Scale Factor is applicable for such Transaction, one,
(iii) the
Notional Amount for such Transaction for the Calculation Period
for such
Transaction (each as defined in the related Confirmation) which
includes
such Valuation Date; or
|
8
Global No. N594309N
|
(B)
|
for
any other Valuation Date, zero,
over
|
(II) the
Threshold for Party A such Valuation Date.
“Xxxxx’x
First Trigger Value”
means,
on any date and with respect to any Eligible Collateral other than Cash,
the bid
price obtained by the Valuation Agent multiplied by the Xxxxx’x First Trigger
Valuation Percentage for such Eligible Collateral set forth in Paragraph
13(b)(ii).
“Xxxxx’x
Second Trigger Event” means
that no Relevant Entity has credit ratings from Xxxxx’x at least equal to the
Xxxxx’x Second Trigger Ratings Threshold.
“Xxxxx’x
Second Trigger Credit Support Amount”
means,
for any Valuation Date, the excess, if any, of
|
(I)
|
(A)
|
for
any Valuation Date on which it is the case that a Xxxxx’x Second Trigger
Ratings Event has occurred and been continuing for at least 30
Local
Business Days, an amount equal to the greatest of (a) zero, (b)
the
aggregate amount of the next payment due to be paid by Party A
under each
Transaction to which this Annex relates, and (c) the sum of (x)
the
Secured Party’s Exposure for such Valuation Date and (y) the sum, for each
Transaction to which this Annex relates, of
|
(1)
if
such Transaction is not a Transaction-Specific Hedge, the product of (i)
the
applicable Xxxxx’x Second Trigger Factor set forth in Table 2, (ii) the Scale
Factor, if any, for such Transaction, or, if no Scale Factor is applicable
for
such Transaction, one, and (iii) the Notional Amount for such Transaction
for
the Calculation Period for such Transaction (each as defined in the related
Confirmation) which includes such Valuation Date;
or
(2)
if
such Transaction is a Transaction-Specific Hedge, the product of (i) the
applicable Xxxxx’x Second Trigger Factor set forth in Table 3, (ii) the Scale
Factor, if any, for such Transaction, or, if no Scale Factor is applicable
for
such Transaction, one, and (iii) the Notional Amount for such Transaction
for
the Calculation Period which includes such Valuation Date; or
|
(B)
|
for
any other Valuation Date, zero,
over
|
(II) the
Threshold for Party A for such Valuation Date.
“Xxxxx’x
Second Trigger Value”
means,
on any date and with respect to any Eligible Collateral other than Cash,
the bid
price obtained by the Valuation Agent multiplied by the Xxxxx’x Second Trigger
Valuation Percentage for such Eligible Collateral set forth in Paragraph
13(b)(ii).
“Next
Payment”
means,
in respect of each Next Payment Date, the greater of (i) the amount of any
payments due to be made by Party A under Section 2(a) on such Next Payment
Date
less any payments due to be made by Party B under Section 2(a) on such Next
Payment Date (in each case, after giving effect to any applicable netting
under
Section 2(c)) and (ii) zero.
9
Global No. N594309N
“Next
Payment Date”
means
each date on which the next scheduled payment under any Transaction is due
to be
paid.
“Pricing
Sources”
means
the sources of financial information commonly known as Bloomberg, Bridge
Information Services, Data Resources Inc., Interactive Data Services,
International Securities Market Association, Xxxxxxx Xxxxx Securities Pricing
Service, Xxxxxx Data Corporation, Reuters, Wood Gundy, Trepp Pricing, XX
Xxxxx,
S&P and Telerate.
“Remaining
Weighted Average Maturity” means,
with respect to a Transaction, the expected weighted average maturity for
such
Transaction as determined by the Valuation Agent.
“S&P
Approved Ratings Downgrade Event”
means that no Relevant Entity has credit ratings at least equal to the S&P
Approved Ratings Threshold.
“S&P
Credit Support Amount”
means,
for any Valuation Date, the excess, if any, of
|
(I)
|
(A)
|
for
any Valuation Date on which (i) an S&P Required Ratings Downgrade
Event, has occurred and been continuing for at least 30 days, or
(ii) a
S&P Required Ratings Downgrade Event has occurred and is continuing,
an amount equal to the sum of (1) 100.0% of the Secured Party’s Exposure
for such Valuation Date and (2) the sum, for each Transaction to
which
this Annex relates, of the product of (i) the Volatility Buffer
for such
Transaction, (ii) the Scale Factor, if any, for such Transaction,
or, if
no Scale Factor is applicable for such Transaction, one, and (iii)
the
Notional Amount of such Transaction for the Calculation Period
of such
Transaction (each as defined in the related Confirmation) which
includes
such Valuation Date, or
|
|
(B)
|
for
any other Valuation Date, zero,
over
|
(II) the
Threshold for Party A for such Valuation Date.
“S&P
Required Ratings Downgrade Event”
means
that on any date, no Relevant Entity has credit ratings at least equal to
the
S&P Required Ratings Threshold.
“S&P
Value”
means,
on any date and with respect to any Eligible Collateral other than Cash,
the
product of (A) the bid price obtained by the Valuation Agent for such Eligible
Collateral and (B) the S&P Valuation Percentage for such Eligible Collateral
set forth in paragraph 13(b)(ii).
“Transaction
Exposure”
means,
for any Transaction, Exposure determined as if such Transaction were the
only
Transaction between the Secured Party and the Pledgor.
“Transaction-Specific
Hedge” means
any
Transaction that is (i) an interest rate swap in respect of which (x) the
notional amount of the interest rate swap is “balance guaranteed” or (y) the
notional amount of the interest rate swap for any Calculation Period (as
defined
in the related Confirmation) otherwise is not a specific dollar amount that
is
fixed at the inception of the Transaction, (ii) an interest rate cap, (iii)
an
interest rate floor or (iv) an interest rate swaption.
“Valuation
Percentage”
shall
mean, for purposes of determining the S&P Value, Xxxxx’x First Trigger
Value, or Xxxxx’x Second Trigger Value with respect to any Eligible Collateral
or Posted Collateral, the applicable S&P Valuation Percentage, Xxxxx’x First
Trigger Valuation Percentage, or Xxxxx’x Second Trigger Valuation Percentage for
such Eligible Collateral or Posted Collateral, respectively, in each case
as set
forth in Paragraph 13(b)(ii).
00
Xxxxxx Xx. X000000X
“Value”
shall
mean, in respect of any date, the related S&P Value, the related Xxxxx’x
First Trigger Value, and the related Xxxxx’x Second Trigger Value.
“Volatility
Buffer”
means,
for any Transaction, the related percentage set forth in the following table.
|
The
higher of the S&P credit rating of (i) Party A and (ii) the Credit
Support Provider of Party A, if applicable
|
Remaining
Weighted Average Maturity of such Transaction
up
to 3 years
|
Remaining
Weighted Average Maturity of such Transaction
up
to 5 years
|
Remaining
Weighted Average Maturity of such Transaction
up
to 10 years
|
Remaining
Weighted Average Maturity of such Transaction
up
to 30 years
|
|
“A-2”
or higher
|
2.75%
|
3.25%
|
4.00%
|
4.75%
|
|
“A-3”
|
3.25%
|
4.00%
|
5.00%
|
6.25%
|
|
“BB+”
or
lower
|
3.50%
|
4.50%
|
6.75%
|
7.50%
|
[Remainder
of this page intentionally left blank]
11
Global No. N594309N
Table
1
Xxxxx’x
First Trigger Factor
|
Remaining
Weighted
Average Life
of
Hedge in Years
|
Weekly
Collateral
Posting
|
|
1 or less
|
0.25%
|
|
More
than 1 but not more than 2
|
0.50%
|
|
More
than 2 but not more than 3
|
0.70%
|
|
More
than 3 but not more than 4
|
1.00%
|
|
More
than 4 but not more than 5
|
1.20%
|
|
More
than 5 but not more than 6
|
1.40%
|
|
More
than 6 but not more than 7
|
1.60%
|
|
More
than 7 but not more than 8
|
1.80%
|
|
More
than 8 but not more than 9
|
2.00%
|
|
More
than 9 but not more than 10
|
2.20%
|
|
More
than 10 but not more than 11
|
2.30%
|
|
More
than 11 but not more than 12
|
2.50%
|
|
More
than 12 but not more than 13
|
2.70%
|
|
More
than 13 but not more than 14
|
2.80%
|
|
More
than 14 but not more than 15
|
3.00%
|
|
More
than 15 but not more than 16
|
3.20%
|
|
More
than 16 but not more than 17
|
3.30%
|
|
More
than 17 but not more than 18
|
3.50%
|
|
More
than 18 but not more than 19
|
3.60%
|
|
More
than 19 but not more than 20
|
3.70%
|
|
More
than 20 but not more than 21
|
3.90%
|
|
More
than 21 but not more than 22
|
4.00%
|
|
More
than 22 but not more than 23
|
4.00%
|
|
More
than 23 but not more than 24
|
4.00%
|
|
More
than 24 but not more than 25
|
4.00%
|
|
More
than 25 but not more than 26
|
4.00%
|
|
More
than 26 but not more than 27
|
4.00%
|
|
More
than 27 but not more than 28
|
4.00%
|
|
More
than 28 but not more than 29
|
4.00%
|
|
More
than 29
|
4.00%
|
12
Global No. N594309N
Table
2
Xxxxx’x
Second Trigger Factor for Interest Rate Swaps with Fixed Notional
Amounts
|
Remaining
Weighted
Average Life
of
Hedge in Years
|
Weekly
Collateral
Posting
|
|
1 or less
|
0.60%
|
|
More
than 1 but not more than 2
|
1.20%
|
|
More
than 2 but not more than 3
|
1.70%
|
|
More
than 3 but not more than 4
|
2.30%
|
|
More
than 4 but not more than 5
|
2.80%
|
|
More
than 5 but not more than 6
|
3.30%
|
|
More
than 6 but not more than 7
|
3.80%
|
|
More
than 7 but not more than 8
|
4.30%
|
|
More
than 8 but not more than 9
|
4.80%
|
|
More
than 9 but not more than 10
|
5.30%
|
|
More
than 10 but not more than 11
|
5.60%
|
|
More
than 11 but not more than 12
|
6.00%
|
|
More
than 12 but not more than 13
|
6.40%
|
|
More
than 13 but not more than 14
|
6.80%
|
|
More
than 14 but not more than 15
|
7.20%
|
|
More
than 15 but not more than 16
|
7.60%
|
|
More
than 16 but not more than 17
|
7.90%
|
|
More
than 17 but not more than 18
|
8.30%
|
|
More
than 18 but not more than 19
|
8.60%
|
|
More
than 19 but not more than 20
|
9.00%
|
|
More
than 20 but not more than 21
|
9.00%
|
|
More
than 21 but not more than 22
|
9.00%
|
|
More
than 22 but not more than 23
|
9.00%
|
|
More
than 23 but not more than 24
|
9.00%
|
|
More
than 24 but not more than 25
|
9.00%
|
|
More
than 25 but not more than 26
|
9.00%
|
|
More
than 26 but not more than 27
|
9.00%
|
|
More
than 27 but not more than 28
|
9.00%
|
|
More
than 28 but not more than 29
|
9.00%
|
|
More than 29
|
9.00%
|
13
Global No. N594309N
Table
3
Xxxxx’x
Second Trigger Factor for Transaction-Specific Xxxxxx
|
Remaining
Weighted
Average Life
of
Hedge in Years
|
Weekly
Collateral
Posting
|
|
1 or less
|
0.75%
|
|
More
than 1 but not more than 2
|
1.50%
|
|
More
than 2 but not more than 3
|
2.20%
|
|
More
than 3 but not more than 4
|
2.90%
|
|
More
than 4 but not more than 5
|
3.60%
|
|
More
than 5 but not more than 6
|
4.20%
|
|
More
than 6 but not more than 7
|
4.80%
|
|
More
than 7 but not more than 8
|
5.40%
|
|
More
than 8 but not more than 9
|
6.00%
|
|
More
than 9 but not more than 10
|
6.60%
|
|
More
than 10 but not more than 11
|
7.00%
|
|
More
than 11 but not more than 12
|
7.50%
|
|
More
than 12 but not more than 13
|
8.00%
|
|
More
than 13 but not more than 14
|
8.50%
|
|
More
than 14 but not more than 15
|
9.00%
|
|
More
than 15 but not more than 16
|
9.50%
|
|
More
than 16 but not more than 17
|
9.90%
|
|
More
than 17 but not more than 18
|
10.40%
|
|
More
than 18 but not more than 19
|
10.80%
|
|
More
than 19 but not more than 20
|
11.00%
|
|
More
than 20 but not more than 21
|
11.00%
|
|
More
than 21 but not more than 22
|
11.00%
|
|
More
than 22 but not more than 23
|
11.00%
|
|
More
than 23 but not more than 24
|
11.00%
|
|
More
than 24 but not more than 25
|
11.00%
|
|
More
than 25 but not more than 26
|
11.00%
|
|
More
than 26 but not more than 27
|
11.00%
|
|
More
than 27 but not more than 28
|
11.00%
|
|
More
than 28 but not more than 29
|
11.00%
|
|
More than 29
|
11.00%
|
14
Global No. N594309N
IN
WITNESS WHEREOF, the parties have executed this Annex by their duly authorized
representatives as of the date of the Agreement.
|
Deutsche
Bank AG
|
HSBC
Bank USA, National Association, not in its individual capacity,
but solely
as Supplemental Interest Trust Trustee for the Supplemental Interest
Trust
with respect to ACE Securities Corp. Home Equity Loan Trust, Series
2007-WM2 Asset Backed Pass-Through Certificates
|
|
By:
/s/: Xxxxxxxxxxx Xxxxxxxx
Xxxxxxxxxxx Xxxxxxxx
Authorized
Signatory
By:
/s/: Xxxxxxxxxxx Xxxxxxx
Xxxxxxxxxxx Xxxxxxx
Authorized Signatory
|
By: /s/:
Xxxxxxxx Xxxxxxx
Xxxxxxxx Xxxxxxx
Vice President
|
15
EXHIBIT
J
CAP
CONTRACTS
J-1
Deutsche
Bank
Deutsche
Bank AG New York
00
Xxxx Xxxxxx
Xxx
Xxxx, XX 00000
Telephone:
000-000-0000
Facsimilie:
000-000-0000
|
DATE:
|
March
30, 2007
|
|
TO:
|
HSBC
Bank USA, National Association, not in its individual capacity,
but solely
as Trustee for the ACE Securities Corp. Home Equity Loan Trust,
Series
2007-WM2 Asset Backed Pass-Through Certificates (“Party
B”)
|
|
ATTENTION:
|
HSBC
BANK USA, National Association
|
|
CTLA
- Structured Finance
|
|
|
000
Xxxxx Xxxxxx
|
|
|
Attn:
Xxxxx Xxx
|
|
|
Xxx
Xxxx, XX 00000
|
|
|
FROM:
|
Deutsche
Bank AG,
New York Branch
|
|
ATTENTION:
|
New
York Derivatives Documentation
|
|
TELEPHONE:
|
0
000 000 0000
|
|
FACSIMILE:
|
1
212 797 0779
|
|
EMAIL:
|
XXxxxxxxxxxx.xxxxxxxxxxxxx@xx.xxx
|
|
OUR
REFERENCE:
|
Global
No. N594317N
|
|
RE:
|
Interest
Rate Cap Transaction
|
The
purpose of this long-form confirmation (“Confirmation”)
is to
confirm the terms and conditions of the current Transaction entered into
on the
Trade Date specified below (the “Transaction”)
between
Deutsche Bank AG,
New
York Branch
(“Party
A”) and
HSBC
Bank USA, National Association, not individually, but solely as trustee (the
“Trustee”) on behalf of the ACE Securities Corp. Home Equity Loan Trust, Series
2007-WM2 Asset Backed Pass-Through Certificates (the “Trust”)
created under Pooling and Servicing Agreement, dated as of March 1, 2007,
among
Ace Securities Corp. (the “Depositor”),
Ocwen
Loan Servicing, LLC (the “Servicer”),
Xxxxx
Fargo Bank, National Association (the “Master
Servicer”
and the
“Securities
Administrator”)
and
HSBC Bank USA, National Association (the
“Trustee”).
This
Confirmation evidences a complete and binding agreement between you and us
to
enter into the Transaction on the terms set forth below and replaces any
previous agreement between us with respect to the subject matter hereof.
This
Confirmation constitutes a “Confirmation”
and also
constitutes a “Schedule”
as
referred to in the ISDA Master Agreement, and Paragraph 13 of a Credit Support
Annex to the Schedule.
|
1.
|
This
Confirmation shall supplement, form a part of, and be subject to
an
agreement in the form of the ISDA Master Agreement (Multicurrency
- Cross
Border) as published and copyrighted in 1992 by the International
Swaps
and Derivatives Association, Inc. (the “ISDA
Master Agreement”),
as if Party A and Party B had executed an agreement in such form
on the
date hereof, with a Schedule as set forth in Item 3 of this Confirmation,
and an ISDA Credit Support Annex (Bilateral Form - ISDA Agreements
Subject
to New York Law Only version) as published and copyrighted in 1994
by the
International Swaps and Derivatives Association, Inc., with Paragraph
13
thereof as set forth in Annex A hereto (the “Credit
Support Annex”).
For the avoidance of doubt, the Transaction described herein shall
be the
sole Transaction governed by such ISDA Master Agreement. In the
event of
any inconsistency among any of the following documents, the relevant
document first listed shall govern: (i) this Confirmation, exclusive
of
the provisions set forth in Item 3 hereof and Annex A hereto; (ii)
the
provisions set forth in Item 3 hereof, which are incorporated by
reference
into the Schedule; (iii) the Credit Support Annex; (iv) the Definitions;
and (v) the ISDA Master Agreement.
|
Each
reference herein to a “Section” (unless specifically referencing the Pooling and
Servicing Agreement) or to a “Section” “of this Agreement” will be construed as
a reference to a Section of the ISDA Master Agreement; each herein reference
to
a “Part” will be construed as a reference to the provisions herein deemed
incorporated in a Schedule to the ISDA Master Agreement; each reference herein
to a “Paragraph” will be construed as a reference to a Paragraph of the Credit
Support Annex.
Chairman
of the Supervisory Board: Clemens Börsig
Management
Board: Xxxxx Xxxxxxxxx (Chairman), Xxxx Xxxxxxxx, Xxxxxx von Heydebreck,
Xxxxxxx
Xx Xxxxx, Xxxxxxx-Xxxxx Xxxxxxxx
Page
2 of
26
|
2.
|
The
terms of the particular Transaction to which this Confirmation
relates are
as follows:
|
|
|
Type
of Transaction:
|
Interest
Rate Cap
|
|
|
Notional
Amount:
|
With
respect to any Calculation Period, the lesser of (i) the amount
set forth
on Schedule I attached hereto for such Calculation Period and
(ii) the
aggregate principal balance of the Group I Mortgage Loans at
the beginning
of the Due Period in which the related Calculation Period begins
(determined for this purpose without regard to any adjustment
of the
Floating Rate Payer Payment Date or Due Period relating to business
days).
|
|
|
Trade
Date:
|
March
29, 2007
|
|
|
Effective
Date:
|
Xxxxx
00, 0000
|
|
|
Xxxxxxxxxxx
Date:
|
September
25, 2007, subject to adjustment in accordance with the Business
Day
Convention.
|
|
|
Fixed
Amounts:
|
||
|
Fixed
Rate Payer:
|
Party
B
|
|
|
Fixed
Rate Payer
|
||
|
Payment
Date:
|
March
30, 2007
|
|
|
Fixed
Amount:
|
$4,000
|
|
|
.
|
||
|
Floating
Amounts:
|
||
|
Floating
Rate Payer:
|
Party
A
|
|
|
Floating
Rate Payer
|
||
|
Period
End Dates:
|
The
25th
calendar day of each month during the Term of this Transaction,
commencing
April 25, 2007 and ending on the Termination Date, subject to
adjustment
in accordance with the Business Day Convention.
|
|
|
Floating
Rate Payer
|
||
|
Payment
Dates:
|
Early
Payment shall be applicable. The Floating Rate Payer Payment
Date shall be
one (1) Business Day preceding each Floating Rate Payer Period
End
Date.
|
|
|
Cap
Rate:
|
7.50%
|
|
|
Floating
Rate Option:
|
USD-LIBOR-BBA
|
|
|
Designated
Maturity:
|
One
month
|
|
Global
No. N594317N
Page 3
of 26
|
Floating
Rate Day
|
||
|
Count
Fraction:
|
Actual/360
|
|
|
Reset
Dates:
|
The
first day of each Calculation Period.
|
|
|
Compounding:
|
Inapplicable
|
|
|
Business
Days:
|
New
York
|
|
|
Business
Day Convention:
|
Following
|
|
|
Calculation
Agent:
|
Party
A
|
Global
No. N594317N
Page 4
of 26
|
3.
|
Provisions
Deemed Incorporated in a Schedule to the ISDA Master
Agreement:
|
|
Part
1.
|
Termination
Provisions.
|
For
the
purposes of this Agreement:-
(a) “Specified
Entity”
will not
apply to Party A or Party B for any purpose.
|
(b)
|
“Specified
Transaction”
will have the meaning specified in Section
14.
|
|
(c)
|
Events
of Default.
|
The
statement below that an Event of Default will apply to a specific party means
that upon the occurrence of such an Event of Default with respect to such
party,
the other party shall have the rights of a Non-defaulting Party under Section
6
of this Agreement; conversely, the statement below that such event will not
apply to a specific party means that the other party shall not have such
rights.
|
(i)
|
The
“Failure
to Pay or Deliver”
provisions of Section 5(a)(i) will apply to Party A and will apply
to
Party B; provided, however, that Section 5(a)(i) is hereby amended
by
replacing the word “third” with the word “first”; provided, further, that
notwithstanding anything to the contrary in Section 5(a)(i), any
failure
by Party A to comply with or perform any obligation to be complied
with or
performed by Party A under the Credit Support Annex shall not constitute
an Event of Default under Section 5(a)(i) unless (A) a Required
Ratings
Downgrade Event has occurred and been continuing for 30 or more
Local
Business Days and (B) such failure is not remedied on or before
the third
Local Business Day after notice of such failure is given to Party
A.
|
|
(ii)
|
The
“Breach
of Agreement”
provisions of Section 5(a)(ii) will apply to Party A and will not
apply to
Party B.
|
|
(iii)
|
The
“Credit
Support Default”
provisions of Section 5(a)(iii) will apply to Party A and will
not apply
to Party B except that Section 5(a)(iii)(1) will apply to Party
B solely
in respect of Party B’s obligations under Paragraph 3(b) of the Credit
Support Annex; provided, however, that notwithstanding anything
to the
contrary in Section 5(a)(iii)(1), any failure by Party A to comply
with or
perform any obligation to be complied with or performed by Party
A under
the Credit Support Annex shall not constitute an Event of Default
under
Section 5(a)(iii) unless (A) a Required Ratings Downgrade Event
has
occurred and been continuing for 30 or more Local Business Days
and (B)
such failure is not remedied on or before the third Local Business
Day
after notice of such failure is given to Party
A.
|
|
(iv)
|
The
“Misrepresentation”
provisions of Section 5(a)(iv) will apply to Party A and will not
apply to
Party B.
|
|
(v)
|
The
“Default
under Specified Transaction”
provisions of Section 5(a)(v) will apply to Party A and will not
apply to
Party B.
|
|
(vi)
|
The
“Cross
Default”
provisions of Section 5(a)(vi) will apply to Party A and will not
apply to
Party B, provided, however, that, notwithstanding the foregoing,
an Event
of Default shall not occur under either Section 5(a)(vi)(1) or
Section
5(a)(vi)(2) if (A) (I) the default, or other similar event or condition
referred to in Section 5(a)(vi)(1) or the failure to pay referred
to in
Section 5(a)(vi)(2) is a failure to pay or deliver caused by an
error or
omission of an administrative or operational nature, and (II) funds
or the
asset to be delivered were available to such party to enable it
to make
the relevant payment or delivery when due and (III) such payment
or
delivery is made within three (3) Local Business Days following
receipt of
written notice from an interested party of such failure to pay,
or (B)
such party was precluded from paying, or was unable to pay, using
reasonable means, through the office of the party through which
it was
acting for purposes of the relevant Specified Indebtedness, by
reason of
force majeure, act of State, illegality or impossibility.
|
Global
No. N594317N
Page 5
of 26
For
purposes of Section 5(a)(vi), solely with respect to Party A:
“Specified
Indebtedness” will have the meaning specified in Section 14 ,except that such
term shall not include obligations in respect of deposits received in the
ordinary course of Party A’s banking business.
“Threshold
Amount” means with respect to Party A an amount equal to three percent (3%) of
the Shareholders’ Equity of Party A or, if applicable, the Eligible Guarantor.
“Shareholders’
Equity” means with respect to an entity, at any time, the sum (as shown in the
most recent annual audited financial statements of such entity) of (i) its
capital stock (including preferred stock) outstanding, taken at par value,
(ii)
its capital surplus and (iii) its retained earnings, minus (iv) treasury
stock,
each to be determined in accordance with generally accepted accounting
principles.
|
(vii)
|
The
“Bankruptcy”
provisions of Section 5(a)(vii) will apply to Party A and will
apply to
Party B except that the provisions of Section 5(a)(vii)(2), (6)
(to the
extent that such provisions refer to any appointment contemplated
or
effected by the Pooling and Servicing Agreement or any appointment
to
which Party B has not become subject), (7) and (9) will not apply
to Party
B; provided that, with respect to Party B only, Section 5(a)(vii)(4)
is
hereby amended by adding after the words “against it” the words
“(excluding any proceeding or petition instituted or presented by
Party A
or its Affiliates)”, and Section 5(a)(vii)(8) is hereby amended by
deleting the words “to (7) inclusive” and inserting lieu thereof “, (3),
(4) as amended, (5), (6) as amended, or
(7)”.
|
|
(viii)
|
The
“Merger
Without Assumption”
provisions of Section 5(a)(viii) will apply to Party A and will
apply to
Party B.
|
(d) Termination
Events.
The
statement below that a Termination Event will apply to a specific party means
that upon the occurrence of such a Termination Event, if such specific party
is
the Affected Party with respect to a Tax Event, the Burdened Party with respect
to a Tax Event Upon Merger (except as noted below) or the non-Affected Party
with respect to a Credit Event Upon Merger, as the case may be, such specific
party shall have the right to designate an Early Termination Date in accordance
with Section 6 of this Agreement; conversely, the statement below that such
an
event will not apply to a specific party means that such party shall not
have
such right; provided, however, with respect to “Illegality” the statement that
such event will apply to a specific party means that upon the occurrence
of such
a Termination Event with respect to such party, either party shall have the
right to designate an Early Termination Date in accordance with Section 6
of
this Agreement.
(i) The
“Illegality”
provisions of Section 5(b)(i) will apply to Party A and will apply to Party
B.
|
(ii)
|
The
“Tax
Event”
provisions of Section 5(b)(ii) will apply to Party A except that,
for
purposes of the application of Section 5(b)(ii) to Party A, Section
5(b)(ii) is hereby amended by deleting the words “(x) any action taken by
a taxing authority, or brought in a court of competent jurisdiction,
on or
after the date on which a Transaction is entered into (regardless
of
whether such action is taken or brought with respect to a party
to this
Agreement) or (y)”, and the “Tax
Event”
provisions of Section 5(b)(ii) will apply to Party B.
|
|
(iii)
|
The
“Tax
Event Upon Merger”
provisions of Section 5(b)(iii) will apply to Party A and will
apply to
Party B, provided that Party A shall not be entitled to designate
an Early
Termination Date by reason of a Tax Event upon Merger in respect
of which
it is the Affected Party.
|
Global
No. N594317N
Page 6
of 26
|
(iv)
|
The
“Credit
Event Upon Merger”
provisions of Section 5(b)(iv) will not apply to Party A and will
not
apply to Party B.
|
|
(e)
|
The
“Automatic
Early Termination”
provision of Section 6(a) will not apply to Party A and will not
apply to
Party B.
|
(f) Payments
on Early Termination.
For the
purpose of Section 6(e) of this Agreement:
|
(i)
|
Market
Quotation will apply, provided, however, that, in the event of
a
Derivative Provider Trigger Event, the following provisions will
apply:
|
|
(A)
|
The
definition of Market Quotation in Section 14 shall be deleted in
its
entirety and replaced with the
following:
|
“Market
Quotation” means,
with respect to one or more Terminated Transactions, a Firm Offer which is
(1)
made by a Reference Market-maker that is an Eligible Replacement, (2) for
an
amount that would be paid to Party B (expressed as a negative number) or
by
Party B (expressed as a positive number) in consideration of an agreement
between Party B and such Reference Market-maker to enter into a Replacement
Transaction, and (3) made on the basis that Unpaid Amounts in respect of
the
Terminated Transaction or group of Transactions are to be excluded but, without
limitation, any payment or delivery that would, but for the relevant Early
Termination Date, have been required (assuming satisfaction of each applicable
condition precedent) after that Early Termination Date is to be
included.
|
(B)
|
The
definition of Settlement Amount shall be deleted in its entirety
and
replaced with the following:
|
“Settlement
Amount”
means,
with respect to any Early Termination Date, an amount (as determined by Party
B)
equal to:
|
(a)
|
If
a Market Quotation for the relevant Terminated Transaction or group
of
Terminated Transactions is accepted by Party B so as to become
legally
binding on or before the day falling ten Local Business Days after
the day
on which the Early Termination Date is designated, or such later
day as
Party B may specify in writing to Party A, but in either case no
later
than one Local Business Day prior to the Early Termination Date
(such day,
the “Latest Settlement Amount Determination Day”), the Termination
Currency Equivalent of the amount (whether positive or negative)
of such
Market Quotation;
|
|
(b)
|
If,
on the Latest Settlement Amount Determination Day, no Market Quotation
for
the relevant Terminated Transaction or group of Terminated Transactions
has been accepted by Party B so as to become legally binding and
one or
more Market Quotations from
Approved Replacements have
been made and remain capable of becoming legally binding upon acceptance,
the Settlement Amount shall equal the Termination Currency Equivalent
of
the amount (whether positive or negative) of the lowest of such
Market
Quotations (for the avoidance of doubt, the lowest of such Market
Quotations shall be the lowest Market Quotation of
such Market Quotations
expressed as a positive number or, if any of such Market Quotations
is
expressed as a negative number, the Market Quotation expressed
as a
negative number with the largest absolute value);
or
|
|
(c)
|
If,
on the Latest Settlement Amount Determination Day, no Market Quotation
for
the relevant Terminated Transaction or group of Terminated Transactions
is
accepted by Party B so as to become legally binding and no Market
Quotation from an Approved Replacement remains capable of becoming
legally
binding upon acceptance, the Settlement Amount shall equal Party
B’s Loss
(whether positive or negative and without reference to any Unpaid
Amounts)
for the relevant Terminated Transaction or group of Terminated
Transactions.
|
Global
No. N594317N
Page 7
of 26
|
(C)
|
If
Party B requests Party A in writing to obtain Market Quotations,
Party A
shall use its reasonable efforts to do so before the Latest Settlement
Amount Determination Day.
|
|
(D)
|
If
the Settlement Amount is a negative number, Section 6(e)(i)(3)
shall be
deleted in its entirety and replaced with the
following:
|
“(3)
Second
Method and Market Quotation.
If the
Second Method and Market Quotation apply, (I) Party B shall pay to Party
A an
amount equal to the absolute value of the Settlement Amount in respect of
the
Terminated Transactions, (II) Party B shall pay to Party A the Termination
Currency Equivalent of the Unpaid Amounts owing to Party A and (III) Party
A
shall pay to Party B the Termination Currency Equivalent of the Unpaid Amounts
owing to Party B; provided, however, that (x) the amounts payable under the
immediately preceding clauses (II) and (III) shall be subject to netting
in
accordance with Section 2(c) of this Agreement and (y) notwithstanding any
other
provision of this Agreement, any amount payable by Party A under the immediately
preceding clause (III) shall not be netted-off against any amount payable
by
Party B under the immediately preceding clause (I).”
|
(E)
|
At
any time on or before the Latest Settlement Amount Determination
Day at
which two or more Market Quotations from Approved Replacements
remain
capable of becoming legally binding upon acceptance, Party B shall
be
entitled to accept only the lowest of such Market Quotations (for
the
avoidance of doubt, the lowest of such Market Quotations shall
be the
lowest Market Quotation of such Market Quotations expressed as
a positive
number or, if any of such Market Quotations is expressed as a negative
number, the Market Quotation expressed as a negative number with
the
largest absolute value).
|
|
(ii)
|
The
Second Method will apply.
|
(g) “Termination
Currency”
means
USD.
(h)
Additional
Termination Events.
Additional Termination Events will apply as provided in Part 5(c).
Global
No. N594317N
Page 8
of 26
Part
2. Tax
Matters.
(a) Tax
Representations.
|
(i)
|
Payer
Representations.
For the purpose of Section 3(e) of this Agreement:
|
(A)
Party
A
makes the following representation(s):
It
is not
required by any applicable law, as modified by the practice of any relevant
governmental revenue authority, of any Relevant Jurisdiction to make any
deduction or withholding for or on account of any Tax from any payment (other
than interest under Section 2(e), 6(d)(ii) or 6(e) of this Agreement) to
be made
by it to the other party under this Agreement. In making this representation,
it
may rely on: the accuracy of any representations made by the other party
pursuant to Section 3(f) of this Agreement; (ii) the satisfaction of the
agreement contained in Section 4(a)(i) or 4(a)(iii) of this Agreement and
the
accuracy and effectiveness of any document provided by the other party pursuant
to Section 4(a)(i) or 4(a)(iii) of this Agreement; and (iii) the satisfaction
of
the agreement of the other party contained in Section 4(d) of this Agreement,
provided that it shall not be a breach of this representation where reliance
is
placed on clause (ii) and the other party does not deliver a form or document
under Section 4(a)(iii) by reason of material prejudice to its legal or
commercial position.
(B) Party
B
makes the following representation(s):
None.
(ii)
Payee
Representations.
For the
purpose of Section 3(f) of this Agreement:
(A) Party
A
makes the following representation(s):
It
is a
“foreign person” within the meaning of the applicable U.S. Treasury Regulations
concerning information reporting and backup withholding tax (as in effect
on
January 1, 2001), unless Party A provides written notice to Party B that
it is
no longer a foreign person. In respect of any Transaction it enters into
through
an office or discretionary agent in the United States or which otherwise
is
allocated for United States federal income tax purposes to such United States
trade or business, each payment received or to be received by it under such
Transaction will be effectively connected with its conduct of a trade or
business in the United States.
(B) Party
B
makes the following representation(s):
None.
|
(b)
|
Tax
Provisions.
|
|
(i)
|
Gross
Up.
Section 2(d)(i)(4) shall not apply to Party B as X, and Section
2(d)(ii)
shall not apply to Party B as Y, in each case such that Party B
shall not
be required to pay any additional amounts referred to
therein.
|
|
(ii)
|
Indemnifiable
Tax.
The definition of “Indemnifiable Tax” in Section 14 is deleted in its
entirety and replaced with the
following:
|
“Indemnifiable
Tax”
means,
in relation to payments by Party A, any Tax and, in relation to payments
by
Party B, no Tax.
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Part
3. Agreement
to Deliver Documents.
(a) For
the
purpose of Section 4(a)(i), tax forms, documents, or certificates to be
delivered are:
|
Party
required to deliver document
|
Form/Document/
Certificate
|
Date
by which to
be
delivered
|
|
Party
A
|
A
correct, complete and duly executed U.S. Internal Revenue Service
Form
W-8ECI or other applicable form (or successor thereto), together
with
appropriate attachments, that eliminates U.S. federal withholding
and
backup withholding Tax on payments to Party A under this
Agreement.
|
(i)
upon execution of this Agreement, (ii) on or before the first payment
date
under this Agreement, including any Credit Support Document, (iii)
promptly upon the reasonable demand by Party B, (iv) prior to the
expiration or obsolescence of any previously delivered form, and
(v)
promptly upon the information on any such previously delivered
form
becoming inaccurate or incorrect.
|
|
Party
B
|
Party
B will deliver at closing an original properly completed and executed
United States Internal Revenue Service Form W-9 or other applicable
form
(or any successor thereto) with respect to any payments received
or to be
received by Party A, that eliminates U.S. federal withholding and
backup
withholding Tax on payments to Party A under this Agreement, and
may
deliver other tax forms relating to the beneficial owner of payments
to
Party B under this Agreement from time to time.
|
(i)
upon execution of this Agreement, (ii) on or before the first payment
date
under this Agreement, including any Credit Support Document, (iii)
promptly upon the reasonable demand by Party B, (iv) prior to the
expiration or obsolescence of any previously delivered form, and
(v)
promptly upon the information on any such previously delivered
form
becoming inaccurate or incorrect.
|
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(b) For
the
purpose of Section 4(a)(ii), other documents to be delivered (unless otherwise
publicly available) are:
|
Party
required to deliver document
|
Form/Document/
Certificate
|
Date
by which to
be
delivered
|
Covered
by Section 3(d) Representation
|
|
Party
A and
Party
B
|
Any
documents required by the receiving party to evidence the authority
of the
delivering party or its Credit Support Provider, if any, for it
to execute
and deliver the Agreement, this Confirmation, and any Credit Support
Documents to which it is a party, and to evidence the authority
of the
delivering party or its Credit Support Provider to perform its
obligations
under the Agreement, this Confirmation and any Credit Support Document,
as
the case may be
|
Upon
the execution and delivery of this Agreement
|
Yes
|
|
Party
A and
Party
B
|
A
certificate of an authorized officer of the party, as to the incumbency
and authority of the respective officers of the party signing the
Agreement, this Confirmation, and any relevant Credit Support Document,
as
the case may be
|
Upon
the execution and delivery of this Agreement
|
Yes
|
|
Party
A
|
Annual
Report of Party A containing consolidated financial statements
certified
by independent certified public accountants and prepared in accordance
with generally accepted accounting principles in the country in
which
Party A is organized
|
Promptly
upon becoming publicly available
|
Yes
|
|
Party
A
|
Quarterly
Financial Statements of Party A containing unaudited, consolidated
financial statements of Party A’s fiscal quarter prepared in accordance
with generally accepted accounting principles in the country in
which
Party A is organized
|
Promptly
upon becoming publicly available
|
Yes
|
|
Party
A
|
An
opinion of counsel to Party A acceptable in form and substance
to Party
B
|
Upon
the execution and delivery of this Agreement
|
No
|
Part
4. Miscellaneous.
|
(a)
|
Address
for Notices:
For the purposes of Section 12(a) of this
Agreement:
|
Address
for notices or communications to Party A:
Any
notice to Party A relating to a particular Transaction shall be delivered
to the
address or facsimile number specified in the Confirmation of such Transaction.
Any notice delivered for purposes of Sections 5 and 6 (other than notices
under
Section 5(a)(i) with respect to Party A) of this Agreement shall be delivered
to
the following address:
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No. N594317N
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Xxxxxxxx
Xxxx XX, Xxxx Office
Xxxxxxxxxxxx
00
00000
Xxxxxxxxx
XXXXXXX
Attention:
Legal Department
Fax
No:
0000 00 000 00000
(For
all
purposes)
Address
for notices or communications to Party B:
Address:
HSBC
BANK
USA, National Association
CTLA
-
Structured Finance
000
Xxxxx
Xxxxxx
Xxx
Xxxx,
XX 00000
|
Attention:
|
Xxxxx
Xxx
|
Tel: 000-000-0000
with
a
copy to:
Address:
Xxxxx
Fargo Bank, N.A.
0000
Xxx
Xxxxxxxxx Xxxx
Xxxxxxxx,
Xxxxxxxx 00000
|
Attention:
|
Client
Manager Ace 2007-WM2
|
Tel: 000-000-0000
Fax: 000-000-0000
(For
all
purposes)
(b) Process
Agent.
For the
purpose of Section 13(c):
Party
A
appoints as its Process Agent: Not applicable.
Party
B
appoints as its Process Agent: Not applicable.
|
(c)
|
Offices.
The provisions of Section 10(a) will apply to this Agreement; neither
Party A nor Party B has any Offices other than as set forth in
the Notices
Section and Party A agrees that, for purposes of Section 6(b) of
this
Agreement, it shall not in the future have any Office other than
one in
the United States.
|
|
(d)
|
Multibranch
Party.
For the purpose of Section 10(c) of this
Agreement:
|
Party
A
is not a Multibranch Party.
|
Party
B is not a Multibranch Party.
|
|
(e)
|
Calculation
Agent.
The Calculation Agent is Party A; provided, however, that if an
Event of
Default shall have occurred with respect to Party A, Party B shall
have
the right to appoint as Calculation Agent a third party, reasonably
acceptable to Party A, the cost for which shall be borne by Party
A.
|
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(f) Credit
Support Document.
Party
A:
The
Credit Support Annex, and any guarantee in support of Party A’s obligations
under this Agreement.
Party
B: The
Credit Support Annex, solely in respect of Party B’s obligations under Paragraph
3(b) of the Credit Support Annex.
|
(g)
|
Credit
Support Provider.
|
Party
A: The
guarantor under any guarantee in support of Party A’s obligations under this
Agreement.
Party
B: None.
|
(h)
|
Governing
Law.
The parties to this Agreement hereby agree that the law of the
State of
New York shall govern their rights and duties in whole, without
regard to
the conflict of law provisions thereof other than New York General
Obligations Law Sections 5-1401 and 5-1402.
|
|
(i)
|
Netting
of Payments.
The parties agree that subparagraph (ii) of Section 2(c) will apply
to
each Transaction hereunder.
|
|
(j)
|
Affiliate.“Affiliate”
shall have the meaning assigned thereto in Section 14; provided,
however,
that Party B shall be deemed to have no Affiliates for purposes
of this
Agreement, including for purposes of Section
6(b)(ii).
|
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Part
5. Others
Provisions.
|
(a)
|
Definitions.
Unless
otherwise specified in a Confirmation, this Agreement and each
Transaction
under this Agreement are subject to the 2000 ISDA Definitions as
published
and copyrighted in 2000 by the International Swaps and Derivatives
Association, Inc. (the “Definitions”),
and will be governed in all relevant respects by the provisions
set forth
in the Definitions, without regard to any amendment to the Definitions
subsequent to the date hereof. The provisions of the Definitions
are
hereby incorporated by reference in and shall be deemed a part
of this
Agreement, except that (i) references in the Definitions to a “Swap
Transaction” shall be deemed references to a “Transaction” for purposes of
this Agreement, and (ii) references to a “Transaction” in this Agreement
shall be deemed references to a “Swap Transaction” for purposes of the
Definitions. Each term capitalized but not defined in this Agreement
shall
have the meaning assigned thereto in the Pooling and Servicing
Agreement.
|
(b) Amendments
to ISDA Master Agreement.
|
(i)
|
Single
Agreement.
Section 1(c) is hereby amended by the adding the words “including, for the
avoidance of doubt, the Credit Support Annex” after the words “Master
Agreement”.
|
(ii) Conditions
Precedent. Section
2(a)(iii) is hereby amended by adding the following at the end thereof:
Notwithstanding
anything to the contrary in Section 2(a)(iii)(1), if an Event of Default
with
respect to Party B or Potential Event of Default with respect to Party B
has
occurred and been continuing for more than 30 Local Business Days and no
Early
Termination Date in respect of the Affected Transactions has occurred or
been
effectively designated by Party A, the obligations of Party A under Section
2(a)(i) shall cease to be subject to the condition precedent set forth in
Section 2(a)(iii)(1) with respect to such specific occurrence of such Event
of
Default or such Potential Event of Default (the “Specific
Event”);
provided, however, for the avoidance of doubt, the obligations of Party A
under
Section 2(a)(i) shall be subject to the condition precedent set forth in
Section
2(a)(iii)(1) (subject to the foregoing) with respect to any subsequent
occurrence of the same Event of Default with respect to Party B or Potential
Event of Default with respect to Party B after the Specific Event has ceased
to
be continuing and with respect to any occurrence of any other Event of Default
with respect to Party B or Potential Event of Default with respect to Party
B
that occurs subsequent to the Specific Event.
|
(iii)
|
Change
of Account.
Section 2(b) is hereby amended by the addition of the following
after the
word “delivery” in the first line
thereof:
|
“to
another account in the same legal and tax jurisdiction as the original
account”.
|
(iv)
|
Representations.
Section 3 is hereby amended by adding at the end thereof the following
subsection (g):
|
|
“(g)
|
Relationship
Between Parties.
|
|
(1)
|
Nonreliance.
(i) It is not relying on any statement or representation of the
other
party regarding the Transaction (whether written or oral), other
than the
representations expressly made in this Agreement or the Confirmation
in
respect of that Transaction and (ii) it has consulted with its
own legal,
regulatory, tax, business, investment, financial and accounting
advisors
to the extent it has deemed necessary, and it has made its own
investment,
hedging and trading decisions based upon its own judgment and upon
any
advice from such advisors as it has deemed necessary and not upon
any view
expressed by the other party.
|
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|
(2)
|
Evaluation
and Understanding. (i) It has the capacity to evaluate (internally
or
through independent professional advice) the Transaction and has
made its
own decision to enter into the Transaction and (ii) It understands
the
terms, conditions and risks of the Transaction and is willing and
able to
accept those terms and conditions and to assume those risks, financially
and otherwise.
|
|
(3)
|
Purpose.
It is entering into the Transaction for the purposes of managing
its
borrowings or investments, hedging its underlying assets or liabilities
or
in connection with a line of business.
|
|
(4)
|
Status
of Parties. The other party is not acting as an agent, fiduciary
or
advisor for it in respect of the Transaction.
|
|
(5)
|
Eligible
Contract Participant. It is an “eligible swap participant” as such term is
defined in, Section 35.1(b)(2) of the regulations (17 C.F.R. 35)
promulgated under, and an “eligible contract participant” as defined in
Section 1(a)(12) of the Commodity Exchange Act, as
amended.”
|
|
(v)
|
Transfer
to Avoid Termination Event.
Section 6(b)(ii) is hereby amended by (i) deleting the words “or if a Tax
Event Upon Merger occurs and the Burdened Party is the Affected
Party,”
and (ii) by deleting the words “to transfer” and inserting the words “to
effect a Permitted Transfer” in lieu
thereof.
|
|
(vi)
|
Jurisdiction.
Section
13(b) is hereby amended by: (i) deleting in the second line of
subparagraph (i) thereof the word "non-", (ii) deleting “; and” from the
end of subparagraph 1 and inserting “.” in lieu thereof, and (iii)
deleting the final paragraph
thereof.
|
|
(vii)
|
Local
Business Day.
The definition of Local Business Day in Section 14 is hereby amended
by
the addition of the words “or any Credit Support Document” after “Section
2(a)(i)” and the addition of the words “or Credit Support Document” after
“Confirmation”.
|
|
(c)
|
Additional
Termination Events.
The following Additional Termination Events will
apply:
|
|
(i)
|
