Exhibit 99.1
EXECUTION COPY
XXXXXX XXXXXXX CAPITAL I INC.
Depositor
XXXXX FARGO BANK, NATIONAL ASSOCIATION
Master Servicer and Securities Administrator
and
LASALLE BANK NATIONAL ASSOCIATION
Trustee and Custodian
---------------------------
POOLING AND SERVICING AGREEMENT
Dated as of July 1, 2006
---------------------------
XXXXXX XXXXXXX MORTGAGE LOAN TRUST 2006-9AR
MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2006-9AR
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS.......................................................10
Section 1.01. Definitions...................................................10
ARTICLE II DECLARATION OF TRUST; ISSUANCE OF CERTIFICATES...................52
Section 2.01. Creation and Declaration of Trust Fund; Conveyance of
Mortgage Loans.................................................52
Section 2.02. Acceptance of Trust Fund by Trustee; Review of
Documentation for Trust Fund...................................55
Section 2.03. Representations and Warranties of the Depositor...............56
Section 2.04. Representations and Warranties of the Depositor and the
Seller as to the Mortgage Loans................................58
Section 2.05. Representations and Warranties of the Seller; Discovery
of Breach; Repurchase or Substitution of Mortgage Loans........58
Section 2.06. Grant Clause..................................................63
Section 2.07. Depositor's Option to Purchase Breached Mortgage Loans........64
Section 2.08. Release of Mortgage Documents for Servicing...................64
ARTICLE III THE CERTIFICATES................................................64
Section 3.01. The Certificates..............................................64
Section 3.02. Registration..................................................65
Section 3.03. Transfer and Exchange of Certificates.........................65
Section 3.04. Cancellation of Certificates..................................69
Section 3.05. Replacement of Certificates...................................69
Section 3.06. Persons Deemed Owners.........................................69
Section 3.07. Temporary Certificates........................................70
Section 3.08. Appointment of Paying Agent...................................70
Section 3.09. Book-Entry Certificates.......................................71
ARTICLE IV ADMINISTRATION OF THE TRUST FUND.................................72
Section 4.01. Custodial Accounts; Distribution Account......................72
Section 4.02. Permitted Withdrawals from the Custodial Accounts and the
Distribution Account...........................................73
Section 4.03. [Reserved]....................................................75
Section 4.04. [Reserved]....................................................75
Section 4.05. Reports to Trustee and Certificateholders.....................75
ARTICLE V DISTRIBUTIONS TO HOLDERS OF CERTIFICATES..........................77
Section 5.01. Distributions Generally.......................................77
Section 5.02. Priorities of Distribution....................................78
Section 5.03. Allocation of Principal Payments to Class A Certificates......82
Section 5.04. Allocation of Losses..........................................84
Section 5.05. Advances by the Master Servicer...............................85
Section 5.06. Compensating Interest Payments................................85
Section 5.07. [Reserved]....................................................85
Section 5.08. Determination of Pass-Through Rates for LIBOR
Certificates...................................................85
Section 5.09. The Swap Account..............................................87
Section 5.10. Certain Matters Regarding The Swap Agreement..................88
ARTICLE VI CONCERNING THE TRUSTEE AND THE SECURITIES ADMINISTRATOR;
EVENTS OF DEFAULT..........................................................91
Section 6.01. Duties of Trustee and the Securities Administrator............91
Section 6.02. Certain Matters Affecting the Trustee and the Securities
Administrator..................................................94
Section 6.03. Trustee and Securities Administrator Not Liable for
Certificates...................................................96
Section 6.04. Trustee and the Securities Administrator May Own
Certificates...................................................96
Section 6.05. Eligibility Requirements for Trustee..........................96
Section 6.06. Resignation and Removal of Trustee and the Securities
Administrator..................................................97
Section 6.07. Successor Trustee and Successor Securities Administrator.....100
Section 6.08. Merger or Consolidation of Trustee or the Securities
Administrator.................................................101
Section 6.09. Appointment of Co-Trustee, Separate Trustee or Custodian.....101
Section 6.10. Authenticating Agents........................................103
Section 6.11. Indemnification of the Trustee and the Securities
Administrator.................................................103
Section 6.12. Fees and Expenses of the Master Servicer, Securities
Administrator, the Trustee and the Custodians.................104
Section 6.13. Collection of Monies.........................................105
Section 6.14. Events of Default; Trustee To Act; Appointment of
Successor.....................................................105
Section 6.15. Additional Remedies of Trustee Upon Event of Default.........110
Section 6.16. Waiver of Defaults...........................................110
Section 6.17. Notification to Holders......................................110
Section 6.18. Directions by Certificateholders and Duties of Trustee
During Event of Default.......................................111
Section 6.19. Action Upon Certain Failures of the Master Servicer and
Upon Event of Default.........................................111
Section 6.20. Preparation of Tax Returns and Other Reports.................111
Section 6.21. Certain Matters Regarding any Custodian Appointed Hereunder..111
ARTICLE VII PURCHASE OF MORTGAGE LOANS AND TERMINATION OF THE TRUST FUND...112
Section 7.01. Purchase of Mortgage Loans; Termination of Trust Fund
Upon Purchase or Liquidation of All Mortgage Loans............112
Section 7.02. Procedure Upon Redemption of Trust Fund......................113
Section 7.03. Additional Trust Fund Termination Requirements...............115
ARTICLE VIII RIGHTS OF CERTIFICATEHOLDERS..................................116
Section 8.01. Limitation on Rights of Holders..............................116
Section 8.02. Access to List of Holders....................................116
Section 8.03. Acts of Holders of Certificates..............................117
ii
ARTICLE IX ADMINISTRATION AND SERVICING OF MORTGAGE LOANS BY THE MASTER
SERVICER..................................................................118
Section 9.01. Duties of the Master Servicer; Enforcement of Servicers'
and Master Servicer's Obligations.............................118
Section 9.02. Assumption of Master Servicing by Trustee....................120
Section 9.03. Representations and Warranties of the Master Servicer........121
Section 9.04. Compensation to the Master Servicer..........................123
Section 9.05. Merger or Consolidation......................................123
Section 9.06. Resignation of Master Servicer and Securities
Administrator.................................................124
Section 9.07. Assignment or Delegation of Duties by the Master Servicer
and Securities Administrator..................................125
Section 9.08. Limitation on Liability of the Master Servicer and Others....125
Section 9.09. Indemnification; Third-Party Claims..........................126
Section 9.10. Eligibility Requirements for Securities Administrator........126
Section 9.11. Annual Statement as to Compliance............................127
ARTICLE X REMIC ADMINISTRATION.............................................127
Section 10.01. REMIC Administration........................................127
Section 10.02. Prohibited Transactions and Activities......................130
Section 10.03. Indemnification with Respect to Prohibited Transactions
or Loss of REMIC Status.......................................131
Section 10.04. REO Property................................................131
Section 10.05. Fidelity....................................................132
ARTICLE XI MISCELLANEOUS PROVISIONS........................................132
Section 11.01. Binding Nature of Agreement; Assignment.....................132
Section 11.02. Entire Agreement............................................132
Section 11.03. Amendment...................................................133
Section 11.04. Voting Rights...............................................134
Section 11.05. Provision of Information....................................134
Section 11.06. Governing Law...............................................134
Section 11.07. Notices.....................................................135
Section 11.08. Severability of Provisions..................................135
Section 11.09. Indulgences; No Waivers.....................................135
Section 11.10. Headings Not To Affect Interpretation.......................136
Section 11.11. Benefits of Agreement.......................................136
Section 11.12. Special Notices to the Rating Agencies......................136
Section 11.13. Conflicts...................................................137
Section 11.14. Counterparts................................................137
Section 11.15. No Petitions................................................137
Section 11.16. Indemnification by Trust....................................137
ARTICLE XII EXCHANGE ACT REPORTING.........................................137
iii
Section 12.01. Filing Obligations..........................................137
Section 12.02. Form 10-D Reporting.........................................139
Section 12.03. Form 8-K Reporting..........................................140
Section 12.04. Form 10-K Reporting.........................................141
Section 12.05. Xxxxxxxx-Xxxxx Certification................................143
Section 12.06. Reports on Assessment of Compliance and Attestation.........143
Section 12.07. Use of Subcontractors.......................................145
Section 12.08. Indemnification by the Master Servicer and the
Securities Administrator....................................146
Section 12.09. Indemnification by the Custodian............................147
iv
ATTACHMENTS
Exhibit A Forms of Certificates
Exhibit B Form of Residual Certificate Transfer Affidavit (Transferee)
Exhibit C Form of Residual Certificate Transfer Affidavit (Transferor)
Exhibit D Form of Swap Agreement
Exhibit E List of Purchase and Servicing Agreements
Exhibit F List of Custodial Agreements
Exhibit G Assignment and Notice of Transfer with respect to each Additional
Collateral Mortgage Loan
Exhibit H Form of Rule 144A Transfer Certificate
Exhibit I Form of Purchaser's Letter for Institutional Accredited Investors
Exhibit J Form of ERISA Transfer Affidavit
Exhibit K Form of Letter of Representations with the Depository Trust Company
Exhibit L-1 Form of Initial Custodian Certification
Exhibit L-2 Form of Final Custodian Certification
Exhibit M Assignment and Notice of Transfer with respect to each Additional
Collateral Mortgage Loan
Exhibit N Additional Disclosure Required Under Regulation AB
Exhibit O Form of Servicing Criteria to be Addressed in Assessment of
Compliance Statement
Exhibit P Additional Disclosure Notification
Exhibit Q Glossary of Terms for Standard & Poor's LEVELS(R) Version 5.7 File
Format
Exhibit R Form of Lost Note Affidavit
Schedule A Mortgage Loan Schedule
Schedule B Principal Balances Schedule
v
This POOLING AND SERVICING AGREEMENT, dated as of July 1, 2006 (the
"Agreement"), by and among XXXXXX XXXXXXX CAPITAL I INC., a Delaware
corporation, as depositor (the "Depositor"), LASALLE BANK NATIONAL
ASSOCIATION, a national banking association, as trustee (the "Trustee"), and
as a custodian (a "Custodian") and XXXXX FARGO BANK, NATIONAL ASSOCIATION, in
its separate capacities as master servicer (the "Master Servicer"), as
securities administrator (the "Securities Administrator") and, in its capacity
as Securities Administrator, as auction administrator (the "Auction
Administrator") and acknowledged by XXXXXX XXXXXXX MORTGAGE CAPITAL INC., a
New York corporation, as seller (the "Seller"), for purposes of Section 2.05.
WITNESSETH THAT
In consideration of the mutual agreements herein contained, the parties
hereto agree as follows:
PRELIMINARY STATEMENT
The Depositor is the owner of the Trust Fund that is hereby conveyed to
the Trustee in return for the Certificates. As provided herein, the Trustee
will make multiple elections to treat segregated pools of assets subject to
this Agreement for federal income tax purposes (other than the Additional
Collateral, the Swap Agreement and the assets held in the Swap Account) as the
following three separate real estate mortgage investment conduits (each, a
"REMIC"): the REMIC 1, REMIC 2 and the Master REMIC. The Swap Agreement and
Swap Account will be assets of a separate trust, and will not be part of any
REMIC. REMIC 1 will consist of the Mortgage Loans, excluding any rights of the
Trust Fund in respect of the Additional Collateral and the Swap Agreement.
REMIC 1 will issue uncertificated REMIC regular interests (the "REMIC 1
Regular Interests"). The REMIC 1 Regular Interests will represent the "regular
interests" in REMIC 1. The Class R-1 Interest will represent the single Class
of "residual interest" in REMIC 1.
The Trustee will hold the REMIC 1 Regular Interests for the benefit of
REMIC 2. REMIC 2 will consist of the REMIC 1 Interests and will issue
uncertificated REMIC regular interests (the "REMIC 2 Regular Interests"). The
REMIC 2 Regular Interests will represent the "regular interests" in REMIC 2.
The Class R-2 Interest will represent the single Class of "residual interest"
in REMIC 2.
The Trustee will hold the REMIC 2 Regular Interests for the benefit of
the Master REMIC. The Master REMIC will consist of the REMIC 2 Interests and
will be evidenced by the Certificates (other than the Class A-R Certificates),
which will constitute the regular interests in the Master REMIC (the "Regular
Certificates") and the Class MR Interest, which will represent the single
Class of "residual interest" in the Master REMIC. The Class A-R Certificates
will represent the beneficial ownership of each class of residual interests
created hereby. The "latest possible maturity date" for federal income tax
purposes of all regular and residual interests created hereunder will be the
Latest Possible Maturity Date.
REMIC 1
The REMIC 1 Interests will have the Initial Principal Balances and
Pass-Through Rates as set forth in the following table:
Initial Principal
REMIC 1 Interests Balance(1) Pass-Through Rate
----------------- ---------- -----------------
Class1-1A $15,842,292.50 (2)
Class1-1B $15,842,292.50 (3)
Class1-2A $15,071,423.10 (2)
Class1-2B $15,071,423.10 (3)
Class1-3A $14,337,696.35 (2)
Class1-3B $14,337,696.35 (3)
Class1-4A $13,639,682.45 (2)
Class1-4B $13,639,682.45 (3)
Class1-5A $12,975,643.30 (2)
Class1-5B $12,975,643.30 (3)
Class1-6A $12,343,925.65 (2)
Class1-6B $12,343,925.65 (3)
Class1-7A $11,742,956.50 (2)
Class1-7B $11,742,956.50 (3)
Class1-8A $11,171,239.50 (2)
Class1-8B $11,171,239.50 (3)
Class1-9A $10,627,351.05 (2)
Class1-9B $10,627,351.05 (3)
Class1-10A $10,109,936.90 (2)
Class1-10B $10,109,936.90 (3)
Class1-11A $9,617,708.55 (2)
Class1-11B $9,617,708.55 (3)
Class1-12A $9,149,440.30 (2)
Class1-12B $9,149,440.30 (3)
Class1-13A $8,703,966.15 (2)
Class1-13B $8,703,966.15 (3)
Class1-14A $8,280,176.70 (2)
Class1-14B $8,280,176.70 (3)
Class1-15A $8,452,270.65 (2)
Class1-15B $8,452,270.65 (3)
Class1-16A $7,465,524.95 (2)
Class1-16B $7,465,524.95 (3)
Class1-17A $7,102,019.05 (2)
Class1-17B $7,102,019.05 (3)
Class1-18A $6,756,208.70 (2)
Class1-18B $6,756,208.70 (3)
Class1-19A $6,427,232.50 (2)
Class1-19B $6,427,232.50 (3)
Class1-20A $6,903,364.70 (2)
Class1-20B $6,903,364.70 (3)
2
Initial Principal
REMIC 1 Interests Balance(1) Pass-Through Rate
----------------- ---------- -----------------
Class1-21A $8,478,586.35 (2)
Class1-21B $8,478,586.35 (3)
Class1-22A $7,139,460.20 (2)
Class1-22B $7,139,460.20 (3)
Class1-23A $5,226,347.85 (2)
Class1-23B $5,226,347.85 (3)
Class1-24A $4,762,943.85 (2)
Class1-24B $4,762,943.85 (3)
Class1-25A $4,531,011.45 (2)
Class1-25B $4,531,011.45 (3)
Class1-26A $4,310,370.25 (2)
Class1-26B $4,310,370.25 (3)
Class1-27A $4,100,470.85 (2)
Class1-27B $4,100,470.85 (3)
Class1-28A $3,977,879.30 (2)
Class1-28B $3,977,879.30 (3)
Class1-29A $4,009,362.40 (2)
Class1-29B $4,009,362.40 (3)
Class1-30A $4,128,902.45 (2)
Class1-30B $4,128,902.45 (3)
Class1-31A $3,635,219.15 (2)
Class1-31B $3,635,219.15 (3)
Class1-32A $3,809,837.40 (2)
Class1-32B $3,809,837.40 (3)
Class1-33A $3,686,707.05 (2)
Class1-33B $3,686,707.05 (3)
Class1-34A $5,423,479.80 (2)
Class1-34B $5,423,479.80 (3)
Class1-35A $2,536,147.90 (2)
Class1-35B $2,536,147.90 (3)
Class1-36A $2,409,644.65 (2)
Class1-36B $2,409,644.65 (3)
Class1-37A $306,529.80 (2)
Class1-37B $306,529.80 (3)
Class1-38A $2,152,983.25 (2)
Class1-38B $2,152,983.25 (3)
Class1-39A $2,048,139.50 (2)
Class1-39B $2,048,139.50 (3)
Class1-40A $1,948,400.10 (2)
Class1-40B $1,948,400.10 (3)
Class1-41A $1,853,516.55 (2)
Class1-41B $1,853,516.55 (3)
Class1-42A $1,763,252.55 (2)
Class1-42B $1,763,252.55 (3)
Class1-43A $1,677,383.15 (2)
3
Initial Principal
REMIC 1 Interests Balance(1) Pass-Through Rate
----------------- ---------- -----------------
Class1-43B $1,677,383.15 (3)
Class1-44A $1,595,694.50 (2)
Class1-44B $1,595,694.50 (3)
Class1-45A $1,517,983.15 (2)
Class1-45B $1,517,983.15 (3)
Class1-46A $1,444,055.40 (2)
Class1-46B $1,444,055.40 (3)
Class1-47A $1,373,727.15 (2)
Class1-47B $1,373,727.15 (3)
Class1-48A $1,306,823.05 (2)
Class1-48B $1,306,823.05 (3)
Class1-49A $1,243,176.60 (2)
Class1-49B $1,243,176.60 (3)
Class1-50A $1,182,629.10 (2)
Class1-50B $1,182,629.10 (3)
Class1-51A $1,133,361.05 (2)
Class1-51B $1,133,361.05 (3)
Class1-52A $1,069,830.05 (2)
Class1-52B $1,069,830.05 (3)
Class1-53A $1,017,723.10 (2)
Class1-53B $1,017,723.10 (3)
Class1-54A $1,050,102.25 (2)
Class1-54B $1,050,102.25 (3)
Class1-55A $935,534.75 (2)
Class1-55B $935,534.75 (3)
Class1-56A $897,314.70 (2)
Class1-56B $897,314.70 (3)
Class1-57A $956,862.45 (2)
Class1-57B $956,862.45 (3)
Class1-58A $13,972,490.85 (2)
Class1-58B $13,972,490.85 (3)
Class1-59A $917,203.45 (2)
Class1-59B $917,203.45 (3)
Class1-Support (4) (4)
Class1-P $100 (5)
ClassR-1 (6) (6)
------------------
(1) Scheduled principal, prepayments and Realized Losses will be allocated
first, to the Class 1-Support Interest and second, among the other
Classes designated "1-", sequentially to the Classes having the lowest
cardinal number following such designation, in each case until reduced
to zero, and among any Classes allocated scheduled principal,
prepayments and Realized Losses for such Distribution Date, pro rata
among each Class having the same cardinal number following such
designation.
4
(2) Prior to the 60th Distribution Date, a rate equal to twice the Weighted
Average Net Mortgage Rate less 11.08% per annum. On and after the 60th
Distribution Date a rate equal to the Weighted Average Net Mortgage
Rate.
(3) Prior to the 60th Distribution Date, a rate equal to the lesser of (i)
11.08% per annum and (ii) twice the Weighted Average Net Mortgage Rate.
On and after the 60th Distribution Date, a rate equal to the Weighted
Average Net Mortgage Rate.
(4) On the Closing Date and on each Distribution Date, following the
allocation of Principal Amounts and Realized Losses, the principal
balance in respect of the Class 1-Support Interest will equal the excess
of the principal balance of the Mortgage Loans (less $100 on the Closing
Date) over the principal balance in respect of the remaining REMIC 1
Interests other than the Class R-1 Interests.
(5) The Class 2-P Interest will not be entitled to any interest, but will be
entitled to 100% of any prepayment premiums paid on the Mortgage Loans.
(6) The Class R-1 Interest is the sole class of residual interest in REMIC
1. It has no principal balance and pays no principal or interest.
REMIC 2
The REMIC 2 Interests will have the Initial Principal Balances and
Pass-Through Rates as set forth in the following table:
--------------------------------------------------------------------------------
Subsidiary REMIC Pass-Through Corresponding
Interests Initial Balance Rate Certificate
--------------------------------------------------------------------------------
2-A-1 (1) (2) Class A-1
--------------------------------------------------------------------------------
2-A-2 (1) (2) Class A-2
--------------------------------------------------------------------------------
2-A-3 (1) (2) Class A-3
--------------------------------------------------------------------------------
2-A-4 (1) (2) Class A-4
--------------------------------------------------------------------------------
2-A-5 (1) (2) Class A-5
--------------------------------------------------------------------------------
2-A-6 (1) (2) Class A-6
--------------------------------------------------------------------------------
2-M-1 (1) (2) Class M-1
--------------------------------------------------------------------------------
2-M-2 (1) (2) Class M-2
--------------------------------------------------------------------------------
2-M-3 (1) (2) Class M-3
--------------------------------------------------------------------------------
2-M-4 (1) (2) Class M-4
--------------------------------------------------------------------------------
2-M-5 (1) (2) Class M-5
--------------------------------------------------------------------------------
2-M-6 (1) (2) Class M-6
--------------------------------------------------------------------------------
2-B-1 (1) (2) Class B-1
--------------------------------------------------------------------------------
2-B-2 (1) (2) Class B-2
--------------------------------------------------------------------------------
2-B-3 (1) (2) Class B-3
--------------------------------------------------------------------------------
2-Accrual (1) N/A(2) N/A
--------------------------------------------------------------------------------
2-Swap IO (3) (3) N/A
--------------------------------------------------------------------------------
2-P $100 N/A(4) N/A
--------------------------------------------------------------------------------
R-2 (5) N/A(5) N/A
--------------------------------------------------------------------------------
5
---------------
(1) For each Distribution Date, following the allocation of scheduled
principal, prepayments and Realized Losses: (i) each such Class of
Interests (other than the Class 2-Accrual Interest) will have a
principal balance equal to 50% of the principal balance in respect of
the Corresponding Class of Certificates, (ii) the Class 2-Accrual
Interests will have a principal balance equal to 50% of the principal
balance of Mortgage Loans plus 50% of the Overcollateralized Amount.
(2) The pass through rate will equal the weighted average of the pass
through rates of the REMIC 1 Interests (other than the Class R-1
Interests) treating each "B" interest as capped at a rate equal to the
product of (i) 2 and (ii) LIBOR on each Distribution Date whose cardinal
number preceding such designation (e.g., -0, -0, -0) is not exceeded by
the ordinal number of the Distribution Date following the Closing Date
(e.g., first, second, third) for such Distribution Date, (the "REMIC 2
Cap").
(3) For each Distribution Date, the REMIC 2-Swap IO shall be entitled to
receive from each "B" interest whose cardinal number preceding such
designation (e.g., -0, -0, -0) is not exceeded by the ordinal number of
the Distribution Date following the Closing Date (e.g., first, second,
third) for such Distribution Date the interest accruing on such interest
in excess of an amount of interest accruing on such interest's balance
at a rate equal to the product of (i) 2 and (ii) LIBOR.
(4) The Class 2-P Interest will not be entitled to any interest, but will be
entitled to 100% of any prepayment premiums paid on the Mortgage Loans.
(5) The R-2 Interest is the sole Class of residual interest in the REMIC 2.
It pays no interest or principal.
The Master REMIC
The following table sets forth characteristics of the Master REMIC
Certificates, together with the minimum denominations and integral multiples
in excess thereof in which such Classes shall be issuable (except that one
Certificate of each Class of Certificates may be issued in a different amount
and, in addition, one Residual Certificate representing the Tax Matters Person
Certificate may be issued in a different amount):
====================================================================================
Integral
Initial Class Multiples in
Principal Pass-Through Minimum Excess of
Class Designation Balance Rate (per annum) Denomination Minimum
------------------------------------------------------------------------------------
Class A-1 $180,500,000 (1) $25,000.00 $1,000.00
------------------------------------------------------------------------------------
Class A-2 $146,000,000 (1) $25,000.00 $1,000.00
------------------------------------------------------------------------------------
Class A-3 $109,600,000 (1) $25,000.00 $1,000.00
------------------------------------------------------------------------------------
Class A-4 $70,200,000 (1) $25,000.00 $1,000.00
------------------------------------------------------------------------------------
Class A-5 $39,315,000 (1) $25,000.00 $1,000.00
------------------------------------------------------------------------------------
Class A-6 $60,624,000 (1) $25,000.00 $1,000.00
------------------------------------------------------------------------------------
Class A-R (2) $100.00 (3) (4) (4)
------------------------------------------------------------------------------------
6
------------------------------------------------------------------------------------
Class M-1 $8,153,000 (1) $25,000.00 $1,000.00
------------------------------------------------------------------------------------
Class M-2 $8,152,000 (1) $25,000.00 $1,000.00
------------------------------------------------------------------------------------
Class M-3 $4,892,000 (1) $25,000.00 $1,000.00
------------------------------------------------------------------------------------
Class M-4 $3,913,000 (1) $25,000.00 $1,000.00
------------------------------------------------------------------------------------
Class M-5 $3,914,000 (1) $25,000.00 $1,000.00
------------------------------------------------------------------------------------
Class M-6 $2,609,000 (1) $25,000.00 $1,000.00
------------------------------------------------------------------------------------
Class B-1 $2,608,000 (1) $25,000.00 $1,000.00
------------------------------------------------------------------------------------
Class B-2 $2,283,000 (1) $25,000.00 $1,000.00
------------------------------------------------------------------------------------
Class B-3 $3,261,000 (1) $25,000.00 $1,000.00
------------------------------------------------------------------------------------
Class P $1,000.00 (5) $1,000.00 N/A
------------------------------------------------------------------------------------
Class OC (6) (6) (7) (7)
====================================================================================
------------------------------------------
(1) Interest will accrue on each Class of Certificates during each Interest
Accrual Period at a rate equal to the lesser of LIBOR plus the
Pass-Through Margin for such Class for such Distribution Date and the
applicable Net WAC Pass-Through Rate for such Distribution Date. For
federal income tax purposes and for each Distribution Date, the Net WAC
Pass-Through Rate will equal the REMIC 2 Cap, and all monies received by
such Certificates in excess of the REMIC 2 Cap will be treated as a
Class IO Shortfall as provided in Section 8.11. The Pass-Through Rate
for the Class of Certificates for the Interest Accrual Period related to
the first Distribution Date will be as indicated in (3) in the
definition of "Pass-Through Margin".
(2) The Class A-R Certificates represent the sole Class of residual interest
in each of the Subsidiary REMIC and the Master REMIC.
(3) The Pass-Through Rate for the Class A-R Certificates for the Interest
Accrual Period related to any Distribution Date will be a per annum rate
equal to the Weighted Average Net Mortgage Rate on the Mortgage Loans.
The Pass-Through Rate for the Class A-R Certificates for the Interest
Accrual Period related to the first Distribution Date will be a per
annum rate of 6.96302%.
(4) The Class A-R Certificate shall be issued as two separate certificates,
one with an initial Certificate Balance of $99.99 and the Tax Matters
Person Certificate with an initial Certificate Balance of $0.01.
(5) The Class P Certificates will not be entitled to any interest, but will
be entitled to 100% of any prepayment premiums paid on the Mortgage
Loans.
(6) For each Interest Accrual Period and for all federal income tax
purposes, the Class OC Certificates will represent three classes of
regular interests issued by the Master REMIC, (i) a class that does not
accrue interest and has a principal balance equal to the
Overcollateralized Amount as of the Closing Date, (ii) a regular
interest that accrues a specified portion of the interest on the REMIC 2
Interests (other than the Class 2-Swap IO and Class R-2 Interests equal
to the excess of the REMIC 2 Cap over the product of two and the
weighted average interest rate of the REMIC 2 Regular Interests, with
each Class other than the Class 2-Accrual Interest subject to a cap
equal to the Pass-Through Rate of the corresponding Master REMIC class
and the Class 2-Accrual Interest subject
7
to a cap of 0.00%, and (iii) a regular interest entitled to 100% of the
cash flow in respect of the Class 2-Swap IO Interest. The Pass-Through
Rate of the Class OC Certificates shall be a rate sufficient to entitle
it to all interest accrued on the Mortgage Loans less the interest
accrued on the other interests issued by the Master REMIC. The Class OC
Distributable Amount for any Distribution Date is payable from current
interest on the Mortgage Loans and any OC Release Amount for that
Distribution Date. The Class OC Certificates will represent beneficial
ownership of a regular interest issued by the Master REMIC and amounts
in the Supplemental Interest Trust, subject to the obligation to make
payments in respect of Basis Risk Carry Forward Amounts. For federal
income tax purposes, the Class OC Certificateholders' obligation to make
payments of Basis Risk Carry Forward Amounts will be treated as payments
made pursuant to an interest rate cap contract written by the Class OC
Certificateholders in favor of each Class of Certificates.
(7) The Class OC Certificates will be issued as a single Class of
Certificates.
The foregoing provisions in the Preliminary Statement are intended to
cause net interest and principal collections in respect of the Mortgage Loans
to be distributed from REMIC 1 to REMIC 2, from REMIC 2 to the Master REMIC
and from the Master REMIC to each Class of Certificates. The Preliminary
Statement will be interpreted and applied consistently with such intent.
For any purpose for which the Pass-Through Rates is calculated, the
interest rate on the Mortgage Loans shall be appropriately adjusted to account
for the difference between the monthly day count convention of the Mortgage
Loans and the monthly day count convention of the regular interests issued by
each of the REMICs. For purposes of calculating the Pass-Through Rates for
each of the interests issued by each REMIC created hereunder (other than the
Master REMIC) such rates shall be adjusted to equal a monthly day count
convention based on a 30 day month for each Due Period and a 360-day year so
that the Mortgage Loans and all regular interests will be using the same
monthly day count convention.
The fiscal year of each REMIC will end on December 31.
8
Set forth below are designations of Classes or Components of Certificates and
other defined terms to the categories used herein:
Accretion Directed Certificates None.
Accretion Directed Components. None.
Accrual Certificates.......... None.
Accrual Components............ None.
Book-Entry Certificates....... All Classes of Certificates other than the
Definitive Certificates.
Class A Certificates.......... Class A-1, Class A-2, Class A-3, Class A-4,
Class A-5 and Class A-6 Certificates.
Class B Certificates.......... Class B-1, Class B-2 and Class B-3 Certificates.
Class M Certificates.......... The Class M-1, Class M-2, Class M-3, Class M-4,
Class M-5 and Class M-6 Certificates.
Component Certificates........ None.
Components.................... For purposes of calculating distributions of
principal and/or interest, the Component
Certificates, if any, will be comprised of
multiple payment components having the
designations, Initial Component Balances or
Notional Amounts, as applicable, and
Pass-Through Rates set forth below:
Initial
Component
Principal Pass-Through
Destination Balance Rate
----------- ----------- -------------
N/A N/A N/A
Definitive Certificates....... Private Certificates and the Residual
Certificates.
Delay Certificates............ All interest-bearing Classes of Certificates
other than the Non-Delay Certificates, if any.
ERISA-Restricted Certificates. The Residual Certificates and
Private Certificates; and any Certificate of a
Class that ceases to satisfy the applicable
rating requirement under the Underwriter's
Exemption.
Floating Rate Certificates.... Offered Certificates.
Senior Certificates........... Class A-R, Class A-1, Class A-2, Class A-3,
Class A-4, Class A-5 and Class A-6 Certificates.
Subordinated Certificates..... Class M-1, Class M-2, Class
M-3, Class M-4, Class M-5, Class M-6, Class
B-1, Class B-2 and Class B-3 Certificates.
Class M Senior Certificates... Class M-1, Class M-2 and Class M-3 Certificates.
9
Inverse Floating Rate
Certificates.................. None.
LIBOR Certificates............ Floating Rate Certificates and Inverse Floating
Rate Certificates.
Non-Delay Certificates........ The LIBOR Certificates.
Notional Amount Certificates.. None.
Notional Amount Components.... None.
Offered Certificates All Classes of Certificates other than the
Private Certificates.
Planned Principal Classes..... None.
Principal Only Certificates... None.
Private Certificates.......... Class P and Class OC Certificates.
Rating Agencies............... S&P and Xxxxx'x.
Regular Certificates.......... All Classes of Certificates, other than the
Residual Certificates.
Residual Certificates......... Class A-R Certificates.
Scheduled Principal Classes... None.
Targeted Principal Classes.... None.
Underwriter................... Xxxxxx Xxxxxxx & Co. Incorporated.
With respect to any of the foregoing designations as to which the
corresponding reference is "None," all defined terms and provisions herein
relating solely to such designations shall be of no force or effect, and any
calculations herein incorporating references to such designations shall be
interpreted without reference to such designations and amounts. Defined terms
and provisions herein relating to statistical rating agencies not designated
above as Rating Agencies shall be of no force or effect.
ARTICLE I
DEFINITIONS
Section 1.01. Definitions.
The following words and phrases, unless the context otherwise requires,
shall have the following meanings:
Accountant: A Person engaged in the practice of accounting who (except
when this Agreement provides that an Accountant must be Independent) may be
employed by or affiliated with the Depositor or an Affiliate of the Depositor.
10
Accretion Directed Certificates: As specified in the Preliminary
Statement.
Accretion Direction Rule: Not applicable.
Accrual Amount: Not Applicable.
Accrual Certificates: As specified in the Preliminary Statement.
Accrual Components: As specified in the Preliminary Statement.
Accrual Termination Date: Not applicable.
Acknowledgements: The Assignment, Assumption and Recognition Agreements,
each dated as of July 1, 2006, assigning rights under the Purchase and
Servicing Agreements from the Seller to the Depositor and from the Depositor
to the Trustee, for the benefit of the Certificateholders.
Act: The Securities Act of 1933, as amended.
Additional Collateral: With respect to any Additional Collateral
Mortgage Loan, the marketable securities and other acceptable collateral
pledged as collateral pursuant to the related pledge agreements.
Additional Form 10-D Disclosure: As defined in Section 12.02 hereof.
Additional Form 10-K Disclosure: As defined in Section 12.04 hereof.
Additional Servicer: Each affiliate of each Servicer that services any
of the Mortgage Loans and each Person who is not an affiliate of the any
Servicer, who services 10% or more of the Mortgage Loans. For clarification
purposes, the Master Servicer and the Securities Administrator are Additional
Servicers.
Additional Collateral Mortgage Loan: Each Mortgage Loan identified as
such in the Mortgage Loan Schedule.
Adjustment Date: A date specified in each Mortgage Note as a date on
which the Mortgage Rate on the related Mortgage Loan will be adjusted.
Advance: With respect to a Mortgage Loan, the payments required to be
made by the Master Servicer or the applicable Servicer with respect to any
Distribution Date pursuant to this Agreement or the applicable Purchase and
Servicing Agreement, as applicable, the amount of any such payment being equal
to the aggregate of the payments of principal and interest (net of the
applicable Servicing Fee and net of any net income in the case of any REO
Property) on the Mortgage Loans that were due on the related Due Date and not
received as of the close of business on the related Determination Date, less
the aggregate amount of any such delinquent payments that the Master Servicer
or the applicable Servicer has determined would constitute Nonrecoverable
Advances if advanced.
11
Adverse REMIC Event: Either (i) loss of status as a REMIC, within the
meaning of Section 860D of the Code, for any group of assets identified as a
REMIC in the Preliminary Statement to this Agreement, or (ii) imposition of
any tax, including the tax imposed under Section 860F(a)(1) on prohibited
transactions, and the tax imposed under Section 860G(d) on certain
contributions to a REMIC, on any REMIC created hereunder to the extent such
tax would be payable from assets held as part of the Trust Fund.
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 Expense Rate: With respect to any Mortgage Loan, the
applicable Servicing Fee Rate and, with respect to any LPMI Mortgage Loan, the
interest premium charged by the mortgagee to obtain or maintain any Primary
Mortgage Insurance Policy.
Aggregate Planned Balance: With respect to any group of Planned
Principal Classes or Components and any Distribution Date, the amount set
forth for such group for such Distribution Date in Schedule B hereto.
Aggregate Targeted Balance: With respect to any group of Targeted
Principal Classes or Components and any Distribution Date, the amount set
forth for such group for such Distribution Date in Schedule B hereto.
Aggregate Voting Interests: The aggregate of the Voting Interests of all
the Certificates under this Agreement.
Agreement: This Pooling and Servicing Agreement and all amendments or
supplements hereto.
Allocable Share: Not applicable.
American Home Mortgage Loan: Each Mortgage Loan originated by American
Home Mortgage Corporation and listed on the Mortgage Loan Schedule.
American Home Purchase Agreement: The Mortgage Loan Purchase and
Warranties Agreement listed in Exhibit E hereto between the Seller and
American Home Mortgage Corporation.
Amount Held for Future Distribution: As to any Distribution Date and
Mortgage Loans, the aggregate amount held in the Custodial Accounts at the
close of business on the related Determination Date on account of (i)
Principal Prepayments received after the related Prepayment Period and
Liquidation Proceeds and Subsequent Recoveries received in the month of such
Distribution Date and (ii) all Scheduled Payments due after the related Due
Date.
Applicable Credit Support Percentage: As defined in Section 5.02(e)
hereof.
12
Applied Loss Amount: As to any Distribution Date, with respect to the
Certificates, the excess, if any, of (i) the aggregate Class Principal
Balances of the Certificates, after giving effect to all Realized Losses with
respect to the Mortgage Loans during the Due Period for such Distribution Date
and payments of principal and Net Swap Receipts on such Distribution Date over
(ii) the aggregate Stated Principal Balance of the Mortgage Loans for such
Distribution Date.
Appraised Value: With respect to any Mortgage Loan, the Appraised Value
of the related Mortgaged Property shall be: (i) with respect to a Mortgage
Loan other than a Refinancing Mortgage Loan, the lesser of (a) the value of
the Mortgaged Property based upon the appraisal made at the time of the
origination of such Mortgage Loan and (b) the sales price of the Mortgaged
Property at the time of the origination of such Mortgage Loan; and (ii) with
respect to a Refinancing Mortgage Loan, the value of the Mortgaged Property
based upon the appraisal made at the time of the origination of such
Refinancing Mortgage Loan.
Assets: As such term is used with respect to any Auction, as defined in
Section 7.01(b) hereof.
Assignment of Mortgage: An assignment of the Mortgage, notice of
transfer or equivalent instrument, in recordable form, sufficient under the
laws of the jurisdiction wherein the related Mortgaged Property is located to
reflect the sale of the Mortgage to the Trustee, which assignment, notice of
transfer or equivalent instrument may be in the form of one or more blanket
assignments covering the Mortgage Loans secured by Mortgaged Properties
located in the same jurisdiction, if permitted by law; provided, however, that
the Trustee shall not be responsible for determining whether any such
assignment is in recordable form or sufficient under the laws of the
applicable jurisdiction to reflect the sale of the Mortgage to the Trustee.
Assignment of Proprietary Lease: With respect to a Cooperative Loan, an
assignment of the Proprietary Lease sufficient under the laws of the
jurisdiction wherein the related Cooperative Unit is located to reflect the
assignment of such Proprietary Lease; provided, however, that the Trustee
shall not be responsible for determining whether such assignment is sufficient
to reflect the assignment of the Proprietary Lease.
Assignment of Recognition Agreement: With respect to a Cooperative Loan,
an assignment of the Recognition Agreement sufficient under the laws of the
jurisdiction wherein the related Cooperative Unit is located to reflect the
assignment of such Recognition Agreement; provided, however, that the Trustee
shall not be responsible for determining whether such assignment is sufficient
to reflect the assignment of the Recognition Agreement.
Auction: As defined in Section 7.01(b) hereof.
Auction Administrator: The Securities Administrator, or any successor in
interest, or if any successor Auction Administrator shall be appointed as
herein provided, then such successor Auction Administrator.
Auction Date: As defined in Section 7.01(b) hereof.
13
Auction Excess Proceeds: With respect to an Auction Sale, the excess of
the Mortgage Loan Auction Price paid by the Auction Purchaser over the Minimum
Bid Price.
Auction Purchaser: As defined in Section 7.01(b) hereof. For the
avoidance of doubt, the Auction Purchaser cannot be the Seller or an Affiliate
of the Seller.
Auction Sale: As defined in Section 7.01(b) hereof.
Authenticating Agent: Any authenticating agent appointed pursuant to
Section 6.10 until any successor authenticating agent for the Certificates is
named, and thereafter "Authenticating Agent" shall mean any such successor.
The initial Authenticating Agent shall be the Securities Administrator under
this Agreement.
Authorized Officer: Any Person who may execute an Officer's
Certificate on behalf of the Depositor.
Available Distribution Amount: For any Distribution Date and the
Certificates, the sum of the following amounts:
(1) the total amount of all cash received by or on behalf of each
Servicer with respect to the Mortgage Loans serviced by it or received by the
Master Servicer by the related Servicer Remittance Date and not previously
distributed (including Liquidation Proceeds, Subsequent Recoveries,
condemnation proceeds and Insurance Proceeds with respect to the Mortgage
Loans), except:
o all scheduled payments of principal and related interest collected
on the Mortgage Loans but due on a date after the related Due Date;
o all partial Principal Prepayments received with respect to the
Mortgage Loans after the related Prepayment Period, together with
all related interest accrued on such Mortgage Loans;
o all Prepayment Penalties received in connection with the Mortgage
Loans;
o all Principal Prepayments in Full received with respect to the
Mortgage Loans after the related Prepayment Period, together with
all related interest accrued on such Mortgage Loans;
o Liquidation Proceeds, condemnation proceeds and Insurance Proceeds
received on such Mortgage Loans after the previous calendar month;
o all amounts reimbursable to a Servicer pursuant to the terms of the
related Purchase and Servicing Agreement or this Agreement, as
applicable, or to the Master Servicer, the Securities Administrator,
the Trustee and/or any Custodian pursuant to the terms of this
Agreement or the Custodial Agreements;
o reinvestment income on the balance of funds, if any, in the
Custodial Accounts or Distribution Account; and
14
o any fees payable to the Servicers and the Master Servicer, in each
case with respect to the Mortgage Loans;
(2) all Advances on the Mortgage Loans made by each Servicer and/or
the Master Servicer for that Distribution Date;
(3) any amounts paid as Compensating Interest with respect to the
Mortgage Loans by each Servicer and/or the Master Servicer for that
Distribution Date; and
(4) the total amount of any cash deposited in the Distribution Account
in connection with the repurchase of any Mortgage Loans by the Depositor, the
Seller or the related Originator.
Available Funds: Not applicable.
Bankruptcy: As to any Person, the making of an assignment for the
benefit of creditors, the filing of a voluntary petition in bankruptcy,
adjudication as a bankrupt or insolvent, the entry of an order for relief in a
bankruptcy or insolvency proceeding, the seeking of reorganization,
arrangement, composition, readjustment, liquidation, dissolution or similar
relief, or seeking, consenting to or acquiescing in the appointment of a
trustee, receiver or liquidator, dissolution, or termination, as the case may
be, of such Person pursuant to the provisions of either the Bankruptcy Code or
any other similar state laws.
Bankruptcy Code: The United States Bankruptcy Code of 1986, as amended.
Basic Principal Distribution Amount: For any Distribution Date will
equal the excess of the Principal Remittance Amount over the Excess
Subordinated Amount.
Basis Risk Carry Forward Amount: With respect to any Class of
Certificates and any Distribution Date on which the Pass-Through Rate for that
Class of Certificates is limited to the Net WAC Pass-Through Rate, an amount
equal to the sum of (i) the excess of (x) the amount of interest such Class of
Certificates would have been entitled to receive on such Distribution Date if
the Net WAC Pass-Through Rate had not been applicable to such Class on such
Distribution Date over (y) the amount of interest accrued on such Distribution
Date at the Net WAC Pass-Through Rate and (ii) the related Basis Risk Carry
Forward Amount for the previous Distribution Date not previously distributed
together with interest thereon at a rate equal to the related Pass-Through
Rate for such Class of Certificates for the most recently ended Interest
Accrual Period.
Book-Entry Certificates: Beneficial interests in Certificates designated
as "Book-Entry Certificates" in this Agreement, ownership and transfers of
which shall be evidenced or made through book entries by a Clearing Agency as
described in Section 3.09; provided, that after the occurrence of a Book-Entry
Termination whereupon book-entry registration and transfer are no longer
permitted and Definitive Certificates are to be issued to Certificate Owners,
such Book-Entry Certificates shall no longer be "Book-Entry Certificates." The
Classes of Certificates that constitute "Book-Entry Certificates" as of the
Closing Date are set forth in the Preliminary Statement.
15
Book-Entry Termination: The date on which the Clearing Agency is no
longer willing or able to properly discharge its responsibilities with respect
to the Book Entry Certificates, and the Depositor is unable to locate a
qualified successor.
Breached Mortgage Loan: A Mortgage Loan (a)(i) on which the first
payment was not made or (ii) that has been delinquent one or two times in the
six months following the Cut-off Date and (b) as to which the Seller obtained
a representation or warranty that no condition set forth in (a)(i) or, for the
same or other period time specified in such representation or warranty
(a)(ii), exists.
Business Day: Any day other than (i) a Saturday or a Sunday or (ii) a
day on which banking institutions in New York, New York or, if other than New
York, the city in which the Corporate Trust Office of the Trustee is located,
or the States of Maryland or Minnesota, are authorized or obligated by law or
executive order to be closed.
Certificate: Any one of the certificates signed by the Trustee, or the
Securities Administrator on the Trustee's behalf, and authenticated by the
Securities Administrator as Authenticating Agent in substantially the forms
attached hereto as Exhibit A.
Certificate Balance: With respect to any Certificate other than a Class
OC Certificate at any date, the maximum dollar amount of principal to which
the Holder thereof is then entitled hereunder, such amount being equal to the
principal balance as of the Closing Date (A) plus any Subsequent Recoveries
added to the Certificate Balance of such Certificate pursuant to Section 5.02
hereof, (B) minus the sum of (i) all distributions of principal previously
made with respect thereto, and (ii) with respect to the Subordinated
Certificates only, all Applied Loss Amounts allocated thereto and all other
reductions in Certificate Balance previously allocated thereto pursuant to
Section 5.04 hereof. No individual Class OC Certificate has a Certificate
Balance.
Certificate Owner: With respect to a Book-Entry Certificate, the Person
who is the owner of such Book-Entry Certificate, as reflected on the books of
the Clearing Agency, or on the books of a Person maintaining an account with
such Clearing Agency (directly or as an indirect participant, in accordance
with the rules of such Clearing Agency).
Certificate Register and Certificate Registrar: The register maintained
and the registrar appointed pursuant to Section 3.02. The initial Certificate
Registrar is the Securities Administrator under this Agreement.
Certificateholder: The meaning provided in the definition of "Holder."
Certification Party: As defined in Section 12.05 hereof.
Certifying Person: As defined in Section 12.05 hereof.
Class: All Certificates bearing the same Class designation as set
forth in the Preliminary Statement.
Class A Certificates: The Class A-1, Class A-2, Class A-3, Class A-4,
Class A-5 and Class A-6 Certificates.
16
Class A Interest Distribution Amount: For the Class of Senior
Certificates and any Distribution Date, the interest accrued during the
related Interest Accrual Period on the related Class Principal Balance of that
Class immediately prior to the Distribution Date at the Pass-Through Rate for
that Class reduced (to an amount not less than zero), in the case of such
Class, by the allocable share, if any, for that Class of Prepayment Interest
Shortfalls to the extent not covered by Compensating Interest paid by the
Master Servicer or the Servicers and Relief Act Interest Shortfalls, together
with the Interest Carry Forward Amount, if any, for such Distribution Date for
such Class of Senior Certificates.
Class A Principal Distribution Amount: With respect to any Distribution
Date (i) prior to the Stepdown Date or on or after the Stepdown Date if a
Trigger Event is in effect, the Principal Distribution Amount or (ii) on or
after the Stepdown Date if a Trigger Event is not in effect for that
Distribution Date, the lesser of:
o the Principal Distribution Amount for that Distribution Date; and
o the excess (if any) of (A) the aggregate Class Principal Balance of
the Class A Certificates immediately prior to that Distribution Date
over (B) the lesser of (i) the aggregate Stated Principal Balance of
the Mortgage Loans as of the last day of the related Due Period
multiplied by 85.90% and (ii) the amount, if any, by which (x) the
aggregate Stated Principal Balance of the Mortgage Loans as of the
last day of the related Due Period exceeds (y) $2,282,773.
Class B-1 Principal Distribution Amount: With respect to the Class B-1
Certificates and any Distribution Date (i) prior to the Stepdown Date or on or
after the Stepdown Date if a Trigger Event is in effect for that Distribution
Date, the Principal Distribution Amount for that Distribution Date remaining
after distribution of the Class A Principal Distribution Amount, the Class M-1
Principal Distribution Amount, the Class M-2 Principal Distribution Amount,
the Class M-3 Principal Distribution Amount, the Class M-4 Principal
Distribution Amount, the Class M-5 Principal Distribution Amount and the Class
M-6 Principal Distribution Amount or (ii) on or after the Stepdown Date if a
Trigger Event is not in effect for that Distribution Date, the lesser of:
o the Principal Distribution Amount for that Distribution Date
remaining after distribution of the Class A Principal Distribution
Amount, the Class M-1 Principal Distribution Amount, the Class M-2
Principal Distribution Amount, the Class M-3 Principal Distribution
Amount, the Class M-4 Principal Distribution Amount, the Class M-5
Principal Distribution Amount and the Class M-6 Principal
Distribution Amount; and
o the excess (if any) of (A) the sum of (1) the Class Principal
Balance of the Class B-1 Certificates immediately prior to that
Distribution Date and (2) aggregate the Class Principal Balance of
the Class A and Class M Certificates (after taking into account the
payment of the Class A, Class M-1, Class M-2, Class M-3, Class M-4,
Class M-5 and Class M-6 Principal Distribution Amounts for such
Distribution Date) over (B) the lesser of (i) the aggregate Stated
Principal Balance of the Mortgage Loans as of the last day of the
related Due Period multiplied by 96.40% and (ii) the amount, if
17
any, by which (x) the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Due Period exceeds
(y) $2,282,773.
Class B-2 Principal Distribution Amount: With respect to the Class B-2
Certificates and any Distribution Date (i) prior to the Stepdown Date or on or
after the Stepdown Date if a Trigger Event is in effect for that Distribution
Date, the Principal Distribution Amount for that Distribution Date remaining
after distribution of the Class A Principal Distribution Amount, the Class M-1
Principal Distribution Amount, the Class M-2 Principal Distribution Amount,
the Class M-3 Principal Distribution Amount, the Class M-4 Principal
Distribution Amount, the Class M-5 Principal Distribution Amount, the Class
M-6 Principal Distribution Amount and the Class B-1 Principal Distribution
Amount or (ii) on or after the Stepdown Date if a Trigger Event is not in
effect for that Distribution Date, the lesser of:
o the Principal Distribution Amount for that Distribution Date
remaining after distribution of the Class A Principal Distribution
Amount, the Class M-1 Principal Distribution Amount, the Class M-2
Principal Distribution Amount, the Class M-3 Principal Distribution
Amount, the Class M-4 Principal Distribution Amount, the Class M-5
Principal Distribution Amount, the Class M-6 Principal Distribution
Amount and the Class B-1 Principal Distribution Amount; and
o the excess (if any) of (A) the sum of (1) the Class Principal
Balance of the Class B-2 Certificates immediately prior to that
Distribution Date and (2) aggregate the Class Principal Balance of
the Class A, Class M and Class B-1 Certificates (after taking into
account the payment of the Class A, Class M-1, Class M-2, Class M-3,
Class M-4, Class M-5, Class M-6 and Class B-1 Principal Distribution
Amounts for such Distribution Date) over (B) the lesser of (i) the
aggregate Stated Principal Balance of the Mortgage Loans as of the
last day of the related Due Period multiplied by 97.10% and (ii) the
amount, if any, by which (x) the aggregate Stated Principal Balance
of the Mortgage Loans as of the last day of the related Due Period
exceeds (y) $2,282,773.
Class B-3 Principal Distribution Amount: With respect to the Class B-3
Certificates and any Distribution Date (i) prior to the Stepdown Date or on or
after the Stepdown Date if a Trigger Event is in effect for that Distribution
Date, the Principal Distribution Amount for that Distribution Date remaining
after distribution of the Class A Principal Distribution Amount, the Class M-1
Principal Distribution Amount, the Class M-2 Principal Distribution Amount,
the Class M-3 Principal Distribution Amount, the Class M-4 Principal
Distribution Amount, the Class M-5 Principal Distribution Amount, the Class
M-6 Principal Distribution Amount, the Class B-1 Principal Distribution Amount
and the Class B-2 Principal Distribution Amount or (ii) on or after the
Stepdown Date if a Trigger Event is not in effect for that Distribution Date,
the lesser of:
o the Principal Distribution Amount for that Distribution Date
remaining after distribution of the Class A Principal Distribution
Amount, the Class M-1 Principal Distribution Amount, the Class M-2
Principal Distribution Amount, the Class M-3 Principal Distribution
Amount, the Class M-4 Principal Distribution Amount, the Class M-5
Principal Distribution Amount, the Class M-6 Principal Distribution
18
Amount, the Class B-1 Principal Distribution Amount and the Class
B-2 Principal Distribution Amount; and
o the excess (if any) of (A) the sum of (1) the Class Principal
Balance of the Class B-3 Certificates immediately prior to that
Distribution Date and (2) aggregate the Class Principal Balance of
the Class A, Class M, Class B-1 and Class B-2 Certificates (after
taking into account the payment of the Class A, Class M-1, Class
M-2, Class M-3, Class M-4, Class M-5, Class M-6, Class B-1 and Class
B-2 Principal Distribution Amounts for such Distribution Date) over
(B) the lesser of (i) the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Due Period
multiplied by 98.10% and (ii) the amount, if any, by which (x) the
aggregate Stated Principal Balance of the Mortgage Loans as of the
last day of the related Due Period exceeds (y) $2,282,773.
Class M Certificates: As set forth in the Preliminary Statement.
Class M-1 Principal Distribution Amount: With respect to the Class M-1
Certificates and any Distribution Date (i) prior to the Stepdown Date or on or
after the Stepdown Date if a Trigger Event is in effect for that Distribution
Date, the Principal Distribution Amount for that Distribution Date remaining
after distribution of the Class A Principal Distribution Amount or (ii) on or
after the Stepdown Date if a Trigger Event is not in effect for that
Distribution Date, the lesser of:
o the Principal Distribution Amount for that Distribution Date
remaining after distribution of the Class A Principal Distribution
Amount; and
o the excess (if any) of (A) the sum of (1) the Class Principal
Balance of the Class M-1 Certificates immediately prior to that
Distribution Date and (2) aggregate the Class Principal Balance of
the Class A Certificates (after taking into account the payment of
the Class A Principal Distribution Amount for such Distribution
Date) over (B) the lesser of (i) the aggregate Stated Principal
Balance of the Mortgage Loans as of the last day of the related Due
Period multiplied by 88.40% and (ii) the amount, if any, by which
(x) the aggregate Stated Principal Balance of the Mortgage Loans as
of the last day of the related Due Period exceeds (y) $2,282,773.
Class M-2 Principal Distribution Amount: With respect to the Class M-2
Certificates and any Distribution Date (i) prior to the Stepdown Date or on or
after the Stepdown Date if a Trigger Event is in effect for that Distribution
Date, the Principal Distribution Amount for that Distribution Date remaining
after distribution of the Class A Principal Distribution Amount and the Class
M-1 Principal Distribution Amount or (ii) on or after the Stepdown Date if a
Trigger Event is not in effect for that Distribution Date, the lesser of:
o the Principal Distribution Amount for that Distribution Date
remaining after distribution of the Class A Principal Distribution
Amount and the Class M-1 Principal Distribution Amount; and
19
o the excess (if any) of (A) the sum of (1) the Class Principal
Balance of the Class M-2 Certificates immediately prior to that
Distribution Date and (2) the aggregate Class Principal Balance of
the Class A and Class M-1 Certificates (after taking into account
the payment of the Class A and Class M-1 Principal Distribution
Amounts for such Distribution Date) over (B) the lesser of (i) the
aggregate Stated Principal Balance of the Mortgage Loans as of the
last day of the related Due Period multiplied by 90.90% and (ii) the
amount, if any, by which (x) the aggregate Stated Principal Balance
of the Mortgage Loans as of the last day of the related Due Period
exceeds (y) $2,282,773.
Class M-3 Principal Distribution Amount: With respect to the Class M-3
Certificates and any Distribution Date (i) prior to the Stepdown Date or on or
after the Stepdown Date if a Trigger Event is in effect for that Distribution
Date, the Principal Distribution Amount for that Distribution Date remaining
after distribution of the Class A Principal Distribution Amount, the Class M-1
Principal Distribution Amount and the Class M-2 Principal Distribution Amount
or (ii) on or after the Stepdown Date if a Trigger Event is not in effect for
that Distribution Date, the lesser of:
o the Principal Distribution Amount for that Distribution Date
remaining after distribution of the Class A Principal Distribution
Amount, the Class M-1 Principal Distribution Amount and the Class
M-2 Principal Distribution Amount; and
o the excess (if any) of (A) the sum of (1) the Class Principal
Balance of the Class M-3 Certificates immediately prior to that
Distribution Date and (2) the aggregate Class Principal Balance of
the Class A, Class M-1 and Class M-2 Certificates (after taking into
account the payment of the Class A, Class M-1 and Class M-2
Principal Distribution Amounts for such Distribution Date) over (B)
the lesser of (i) the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Due Period
multiplied by 92.40% and (ii) the amount, if any, by which (x) the
aggregate Stated Principal Balance of the Mortgage Loans as of the
last day of the related Due Period exceeds (y) $2,282,773.
Class M-4 Principal Distribution Amount: With respect to the Class M-4
Certificates and any Distribution Date (i) prior to the Stepdown Date or on or
after the Stepdown Date if a Trigger Event is in effect for that Distribution
Date, the Principal Distribution Amount for that Distribution Date remaining
after distribution of the Class A Principal Distribution Amount, the Class M-1
Principal Distribution Amount, the Class M-2 Principal Distribution Amount and
the Class M-3 Principal Distribution Amount or (ii) on or after the Stepdown
Date if a Trigger Event is not in effect for that Distribution Date, the
lesser of:
o the Principal Distribution Amount for that Distribution Date
remaining after distribution of the Class A Principal Distribution
Amount, the Class M-1 Principal Distribution Amount, the Class M-2
Principal Distribution Amount and the Class M-3 Principal
Distribution Amount; and
o the excess (if any) of (A) the sum of (1) the Class Principal
Balance of the Class M-4 Certificates immediately prior to that
Distribution Date and (2) the aggregate Class
20
Principal Balance of the Class A, Class M-1, Class M-2 and Class M-3
Certificates (after taking into account the payment of the Class A,
Class M-1, Class M-2 and Class M-3 Principal Distribution Amounts
for such Distribution Date) over (B) the lesser of (i) the aggregate
Stated Principal Balance of the Mortgage Loans as of the last day of
the related Due Period multiplied by 93.60% and (ii) the amount, if
any, by which (x) the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Due Period exceeds
(y) $2,282,773.
Class M-5 Principal Distribution Amount: With respect to the Class M-5
Certificates and any Distribution Date (i) prior to the Stepdown Date or on or
after the Stepdown Date if a Trigger Event is in effect for that Distribution
Date, the Principal Distribution Amount for that Distribution Date remaining
after distribution of the Class A Principal Distribution Amount, the Class M-1
Principal Distribution Amount, the Class M-2 Principal Distribution Amount,
the Class M-3 Principal Distribution Amount and the Class M-4 Principal
Distribution Amount or (ii) on or after the Stepdown Date if a Trigger Event
is not in effect for that Distribution Date, the lesser of:
o the Principal Distribution Amount for that Distribution Date
remaining after distribution of the Class A Principal Distribution
Amount, the Class M-1 Principal Distribution Amount, the Class M-2
Principal Distribution Amount, the Class M-3 Principal Distribution
Amount and the Class M-4 Principal Distribution Amount; and
o the excess (if any) of (A) the sum of (1) the Class Principal
Balance of the Class M-5 Certificates immediately prior to that
Distribution Date and (2) the aggregate Class Principal Balance of
the Class A, Class M-1, Class M-2, Class M-3 and Class M-4
Certificates (after taking into account the payment of the Class A,
Class M-1, Class M-2, Class M-3 and Class M-4 Principal Distribution
Amounts for such Distribution Date) over (B) the lesser of (i) the
aggregate Stated Principal Balance of the Mortgage Loans as of the
last day of the related Due Period multiplied by 94.80% and (ii) the
amount, if any, by which (x) the aggregate Stated Principal Balance
of the Mortgage Loans as of the last day of the related Due Period
exceeds (y) $2,282,773.
Class M-6 Principal Distribution Amount: With respect to the Class M-6
Certificates and any Distribution Date (i) prior to the Stepdown Date or on or
after the Stepdown Date if a Trigger Event is in effect for that Distribution
Date, the Principal Distribution Amount for that Distribution Date remaining
after distribution of the Class A Principal Distribution Amount, the Class M-1
Principal Distribution Amount, the Class M-2 Principal Distribution Amount,
the Class M-3 Principal Distribution Amount, the Class M-4 Principal
Distribution Amount and the Class M-5 Principal Distribution Amount or (ii) on
or after the Stepdown Date if a Trigger Event is not in effect for that
Distribution Date, the lesser of:
o the Principal Distribution Amount for that Distribution Date
remaining after distribution of the Class A Principal Distribution
Amount, the Class M-1 Principal Distribution Amount, the Class M-2
Principal Distribution Amount, the Class M-3 Principal Distribution
Amount, the Class M-4 Principal Distribution Amount and the Class
M-5 Principal Distribution Amount; and
21
o the excess (if any) of (A) the sum of (1) the Class Principal
Balance of the Class M-6 Certificates immediately prior to that
Distribution Date and (2) the aggregate Class Principal Balance of
the Class A, Class M-1, Class M-2, Class M-3, Class M-4 and Class
M-5 Certificates (after taking into account the payment of the Class
A, Class M-1, Class M-2, Class M-3, Class M-4 and Class M-5
Principal Distribution Amounts for such Distribution Date) over (B)
the lesser of (i) the aggregate Stated Principal Balance of the
Mortgage Loans as of the last day of the related Due Period
multiplied by 95.60% and (ii) the amount, if any, by which (x) the
aggregate Stated Principal Balance of the Mortgage Loans as of the
last day of the related Due Period exceeds (y) $2,282,773.
Class Interest Shortfall: Not applicable.
Class OC Certificates: As specified in the Preliminary Statement.
Class OC Distributable Amount: With respect to any Distribution Date and
the Class OC Certificates, the excess, if any, of (x) the sum of (i) the
amount of interest accrued during the related Accrual Period at the related
Pass-Through Rate on the Class Principal Balance for such Distribution Date
and not included in the Extra Principal Distribution Amount on that
Distribution Date and (ii) the Overcollateralization Release Amount, if any,
for such Distribution Date, over (y) the Overcollateralization Increase Amount
and the amount of any Swap Termination Payment, if any, for such Distribution
Date.
Class OC Interest: The Upper-Tier Regular Interest as specified and
described in the Preliminary Statement and the related footnote thereto.
Class Optimal Interest Distribution Amount: Not applicable.
Class P Distribution Amount: For each Distribution Date and the Mortgage
Loans, an amount equal to the total of all Prepayment Penalties received by
the Securities Administrator from the Servicers on the Mortgage Loans in the
prior Due Period. The Class P Distribution Amount is not part of the Available
Distribution Amount and is therefore not available for distributions to the
Classes of Certificates.
Class Principal Balance: With respect to any Class of Certificates other
than the Class OC Certificates and as to any date of determination, the
aggregate of the Certificate Balances of all Certificates of such Class as of
such date. With respect to the Class OC Certificates and any Distribution
Date, the Overcollateralized Amount as of that Distribution Date.
Class Subordination Percentage: Not applicable.
Clearing Agency: An organization registered as a "clearing agency"
pursuant to Section 17A of the Securities Exchange Act of 1934, as amended.
As of the Closing Date, the Clearing Agency shall be The Depository Trust
Company.
Clearing Agency Participant: A broker, dealer, bank, other financial
institution or other Person for whom from time to time a Clearing Agency
effects book-entry transfers and pledges of securities deposited with the
Clearing Agency.
22
Closing Date: July 31, 2006.
Code: The Internal Revenue Code of 1986, as amended, and as it may be
further amended from time to time, any successor statutes thereto, and
applicable U.S. Department of Treasury regulations issued pursuant thereto in
temporary or final form.
Collateralization Event: As defined in the Swap Agreement.
Commission: The U.S. Securities and Exchange Commission.
Compensating Interest Payment: As to any Distribution Date, an amount
equal to the lesser of (i) the Prepayment Interest Shortfall on the Mortgage
Loans serviced by such Servicer with respect to such Distribution Date and
(ii) the portion of the applicable Servicing Fee that the related Servicer is
required to remit to the Trust as compensation therefor in accordance with the
terms of the related Purchase and Servicing Agreement.
Component: As specified in the Preliminary Statement.
Component Balance: With respect to any Component and any Distribution
Date, the Initial Component Balance thereof on the Closing Date, (A) plus any
Subsequent Recoveries added to the Component Balance of such Component
pursuant to Section 5.02, (B) minus the sum of all amounts applied in
reduction of the principal balance of such Component and Realized Losses
allocated thereto on previous Distribution Dates.
Component Certificates: As specified in the Preliminary Statement.
Component Notional Amount: Not applicable.
Confirmation: With respect to the Swap Agreement, the related
Confirmation dated July 31, 2006, evidencing the transaction between the Swap
Counterparty and the Securities Administrator on behalf of the Trust Fund.
Consent: A document executed by the Cooperative Corporation (i)
consenting to the sale of the Cooperative Unit to the Mortgagor and (ii)
certifying that all maintenance charges relating to the Cooperative Unit have
been paid.
Controlling Person: With respect to any Person, any other Person who
"controls" such Person within the meaning of the Securities Act.
Cooperative Corporation: The entity that holds title (fee or an
acceptable leasehold estate) to the real property and improvements
constituting the Cooperative Property and which governs the Cooperative
Property, which Cooperative Corporation must qualify as a Cooperative Housing
Corporation under Section 216 of the Code.
Cooperative Loan: A Mortgage Loan secured by Cooperative Shares and a
Proprietary Lease, if any.
23
Cooperative Property: The real property and improvements owned by the
Cooperative Corporation, that includes the allocation of individual dwelling
units to the holders of the shares of the Cooperative Corporation.
Cooperative Shares: Shares issued by a Cooperative Corporation.
Cooperative Unit: With respect to any Cooperative Loan, a specific
unit in a Cooperative Property.
Corporate Trust Office: With respect to the Trustee, the designated
office of the Trustee in the State of Illinois at which at any particular time
its corporate trust business with respect to this Agreement is administered,
which office at the date of the execution of this Agreement is located at 000
Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxxx 00000, Attn: Global
Securities and Trust Services MSM 2006-9AR, and which is the address to which
notices to and correspondence with the Trustee should be directed, or at such
other address as the Trustee may designate from time to time by notice to the
Certificateholders, the Depositor, the Master Servicer and the Securities
Administrator or the principal corporate trust office of any successor
Trustee. With respect to the Certificate Registrar and presentment of
Certificates for registration of transfer, exchange or final payment, Xxxxx
Fargo Bank, National Association, Xxxxx Xxxxxx xxx Xxxxxxxxx Xxxxxx,
Xxxxxxxxxxx, Xxxxxxxxx 00000, Attention: Corporate Trust, Xxxxxx Xxxxxxx
Mortgage Loan Trust 2006-9AR, and for all other purposes, X.X. Xxx 00,
Xxxxxxxx, Xxxxxxxx 00000 (or for overnight deliveries, 0000 Xxx Xxxxxxxxx
Xxxx, Xxxxxxxx, Xxxxxxxx 00000), Attention: Corporate Trust, Xxxxxx Xxxxxxx
Mortgage Loan Trust 2006-9AR.
Custodial Account: Each custodial account (other than an Escrow Account)
established and maintained by a Servicer pursuant to a Purchase and Servicing
Agreement.
Custodial Agreement: The Custodial Agreements, listed in Exhibit F
hereof, as each such agreement may be amended or supplemented from time to
time as permitted hereunder.
Custodial Delivery Failure: With respect to any Custodian appointed
hereunder, as defined in Section 6.21 hereof.
Custodian Certification: As defined in Section 2.01.
Custodian: A Person who is at anytime appointed by the Depositor as a
custodian of the Mortgage Documents and the Trustee Mortgage Files. The
initial Custodians are JPMorgan Chase Bank, National Association and LaSalle
Bank, National Association. "Custodian" shall refer to each Custodian or all
Custodians, as the context requires.
Cut-off Date: July 1, 2006.
Cut-off Date Pool Principal Balance: $652,220,892.
Cut-off Date Principal Balance: As to any Mortgage Loan, the Stated
Principal Balance thereof as of the close of business on the Cut-off Date.
Debt Service Reduction: With respect to any Mortgage Loan, a reduction
by a court of competent jurisdiction in a proceeding under the Bankruptcy Code
in the Scheduled Payment for such Mortgage Loan which became final and
non-appealable, except such a reduction resulting from a Deficient Valuation
or any reduction that results in a permanent forgiveness of principal.
24
Deceased Holder: Not applicable.
Defaulted Swap Termination Payment: Any Swap Termination Payment
required to be paid by the Supplemental Interest Trust to the Swap
Counterparty pursuant to the Swap Agreement as a result of an Event of Default
(as defined in the Swap Agreement) with respect to which the Swap Counterparty
is the defaulting party or a Termination Event (as defined in the Swap
Agreement) (other than Illegality or a Tax Event that is not a Tax Event Upon
Merger (each as defined in the Swap Agreement)) with respect to which the Swap
Counterparty is the sole Affected Party (as defined in the Swap Agreement).
Defective Mortgage Loan: The meaning specified in Section 2.05(a).
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 indebtedness under the Mortgage Loan, or
any reduction in the amount of principal to be paid in connection with any
Scheduled Payment that results in a permanent forgiveness of principal, which
valuation or reduction results from an order of such court which is final and
non-appealable in a proceeding under the Bankruptcy Code.
Definitive Certificate: A Certificate of any Class issued in definitive,
fully registered, certificated form. As of the Closing Date the Classes of
Certificates being issued as "Definitive Certificates" are set forth in the
Preliminary Statement.
Delay Certificates: As specified in the Preliminary Statement.
Deleted Mortgage Loan: A Mortgage Loan that is repurchased, or
replaced or to be replaced with a Replacement Mortgage Loan.
Delinquent: Any Mortgage Loan with respect to which the Scheduled
Payment due on a Due Date is not received.
Depositor: Xxxxxx Xxxxxxx Capital I Inc., a Delaware corporation
having its principal place of business in New York, or its successors in
interest.
Depository: Cede & Co., or any other organization registered as a
"clearing agency" pursuant to Section 17A of the Securities Exchange Act of
1934, as amended. The Depository shall initially be the registered Holder of
the Book-Entry Certificates. The Depository shall at all times be a
"clearing corporation" as defined in Section 8-102(a)(5) of the Uniform
Commercial Code of the State of New York.
Determination Date: With respect to each Servicer, the "Determination
Date" set forth in the related Purchase and Servicing Agreement.
Disqualified Organization: A "disqualified organization" as defined in
Section 860E(e)(5) of the Code.
Distribution Account: The separate Eligible Account created and
maintained by the Securities Administrator, on behalf of the Trustee, pursuant
to Section 4.01. Funds in the
25
Distribution Account (exclusive of any earnings on investments made with funds
deposited in the Distribution Account) shall be held in trust for the Trustee
and the Certificateholders for the uses and purposes set forth in this
Agreement.
Distribution Account Deposit Date: With respect to each Servicer, not
later than 1:00 p.m., New York time, on 18th day of each calendar month after
the initial issuance of the Certificates or, if such 18th day is not a
Business Day, either the immediately preceding or immediately following
Business Day, as set forth in the related Acknowledgement, commencing in
August 2006.
Distribution Date: The 25th day of each month or, if such 25th day is
not a Business Day, the next succeeding Business Day, commencing in August
2006.
Due Date: With respect to any Distribution Date, the first day of the
month in which such Distribution Date occurs. With respect to any Mortgage
Loan, the date on which a Scheduled Payment is due under the related Mortgage
Note as indicated in the applicable Purchase and Servicing Agreement.
Due Period: As to any Distribution Date, the period beginning on the
second day of the month preceding the month of such Distribution Date, and
ending on the first day of the month of such Distribution Date.
XXXXX: The Commission's Electronic Data Gathering, Analysis and
Retrieval system.
Eligible Account: Any of (i) an account or accounts maintained with a
federal or state chartered depository institution or trust company the
short-term unsecured debt obligations of which (or, in the case of a
depository institution or trust company that is the principal subsidiary of a
holding company, the debt obligations of such holding company) have the
highest short-term ratings of each Rating Agency at the time any amounts are
held on deposit therein, or (ii) an account or accounts in a depository
institution or trust company in which such accounts are insured by the FDIC or
the SAIF (to the limits established by the FDIC or the SAIF) and the uninsured
deposits in which accounts are otherwise secured such that, as evidenced by an
Opinion of Counsel delivered to the Trustee and to each Rating Agency, the
Certificateholders have a claim with respect to the funds in such account or a
perfected first priority security interest against any collateral (which shall
be limited to Permitted Investments) securing such funds that is superior to
claims of any other depositors or creditors of the depository institution or
trust company in which such account is maintained, or (iii) a trust account or
accounts maintained with the trust department of a federal or state chartered
depository institution or trust company, acting in its fiduciary capacity or
(iv) any other account acceptable to each Rating Agency, as evidenced by a
signed writing delivered by each Rating Agency. Eligible Accounts may bear
interest, and may include, if otherwise qualified under this definition,
accounts maintained with the Trustee, the Paying Agent, the Securities
Administrator or the Master Servicer.
Eligible Institution: An institution having the highest short-term debt
rating, and one of the two highest long-term debt ratings of the Rating
Agencies or the approval of the Rating Agencies.
26
ERISA: The Employee Retirement Income Security Act of 1974, as amended.
ERISA-Qualifying Underwriting: A best efforts or firm commitment
underwriting or private placement that meets the requirements of an
Underwriter's Exemption.
ERISA-Restricted Certificate: As specified in the Preliminary Statement.
Escrow Account: With respect to each Mortgage Loan, as defined in
Article I of the related Purchase and Servicing Agreement.
Estoppel Letter: A document executed by the Cooperative Corporation
certifying, with respect to a Cooperative Unit, (i) the appurtenant
Proprietary Lease will be in full force and effect as of the date of issuance
thereof, (ii) the related stock certificate was registered in the Mortgagor's
name and the Cooperative Corporation has not been notified of any lien upon,
pledge of, levy of execution on or disposition of such stock certificate, and
(iii) the Mortgagor is not in default under the appurtenant Proprietary Lease
and all charges due the Cooperative Corporation have been paid.
Event of Default: Any one of the conditions or circumstances enumerated
in Section 6.14.
Excess Subordinated Amount: For any Distribution Date, will equal the
excess, if any, of the Overcollateralized Amount on that Distribution Date
over (ii) the Overcollateralization Target Amount for such Distribution Date.
Extra Principal Distribution Amount: For any Distribution Date, will be
the lesser of the Net Monthly Excess Cashflow for such Distribution Date and
the Overcollateralization Increase Amount as of that Distribution Date.
Exchange Act: The Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder.
Exchange Act Reports: Any reports on Form 10-D, Form 8-K and Form 10-K
required to be filed with respect to the Trust Fund under the Exchange Act.
Xxxxxx Xxx: The entity formerly known as the Federal National Mortgage
Association, a federally chartered and privately owned corporation organized
and existing under the Federal National Mortgage Association Charter Act, or
any successor thereto.
FDIC: The Federal Deposit Insurance Corporation or any successor
thereto.
FHLMC: The Federal Home Loan Mortgage Corporation, a corporate
instrumentality of the United States created and existing under Title III of
the Emergency Home Finance Act of 1970, as amended, or any successor thereto.
Final Custodian Certification: As defined in Section 2.02 hereof.
Fiscal Agent: Not applicable.
27
Fitch: Fitch, Inc., or any successor thereto. If Fitch is designated
as a Rating Agency in the Preliminary Statement, for purposes of Section
11.07 the address for notices to Fitch shall be Fitch, Inc., Xxx Xxxxx Xxxxxx
Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Residential Mortgage
Surveillance Group, or such other address as Fitch may hereafter furnish to
the Depositor, the Trustee and the Master Servicer.
FNBN Mortgage Loan: Each Mortgage Loan originated by First National
Bank of Nevada and listed on the Mortgage Loan Schedule.
FNBN Purchase Agreement: The Mortgage Loan Purchase Agreement listed
in Exhibit E hereto between the Seller and First National Bank of Nevada.
Form 8-K Disclosure: As defined in Section 12.03 hereof.
Global Securities: The global certificates representing the Book-Entry
Certificates.
GMAC Serviced Mortgage Loan: Each Mortgage Loan serviced by GMAC
Mortgage Corporation and listed on the Mortgage Loan Schedule.
GMAC Servicing Agreement: The Servicing Agreement listed in Exhibit E
hereto between the Seller and GMAC Mortgage Corporation.
Hemisphere Mortgage Loan: Each Mortgage Loan originated by The
Hemisphere National Bank and listed on the Mortgage Loan Schedule.
Hemisphere Purchase Agreement: The Mortgage Loan Purchase and
Warranties Agreement listed in Exhibit E hereto between the Seller and The
Hemisphere National Bank.
Hemisphere Serviced Mortgage Loan: Each Mortgage Loan serviced by The
Hemisphere National Bank and listed on the Mortgage Loan Schedule.
Hemisphere Servicing Agreement: The Servicing Agreement listed in
Exhibit E hereto between the Seller and The Hemisphere National Bank.
Holder: The registered owner of any Certificate as recorded on the books
of the Certificate Registrar except that, solely for the purposes of taking
any action or giving any consent pursuant to this Agreement, any Certificate
registered in the name of the Depositor, the Trustee, the Master Servicer, the
Securities Administrator and any Servicer, or any Affiliate thereof shall be
deemed not to be outstanding in determining whether the requisite percentage
necessary to effect any such consent has been obtained, except that, in
determining whether the Trustee or the Securities Administrator shall be
protected in relying upon any such consent, only Certificates that a
Responsible Officer of the Trustee or the Securities Administrator,
respectively, knows to be so owned shall be disregarded. The Trustee or the
Securities Administrator may request and conclusively rely on certifications
by the Depositor, the Master Servicer, the Securities Administrator or any
Servicer in determining whether any Certificates are registered to an
Affiliate of the Depositor, the Master Servicer, the Securities Administrator
or any Servicer.
28
HUD: The United States Department of Housing and Urban Development, or
any successor thereto.
Indemnifying Party: As specified in Section 12.08 hereof.
Independent: When used with respect to any Accountants, a Person who is
"independent" within the meaning of Rule 2-01(b) of the Securities and
Exchange Commission's Regulation S-X. When used with respect to any other
Person, a Person who (a) is in fact independent of another specified Person
and any Affiliate of such other Person, (b) does not have any material direct
financial interest in such other Person or any Affiliate of such other Person,
and (c) is not connected with such other Person or any Affiliate of such other
Person as an officer, employee, promoter, underwriter, trustee, partner,
director or Person performing similar functions.
Index: As to each Mortgage Loan, the index from time to time in effect
for adjustment of the Mortgage Rate as set forth as such on the related
Mortgage Note.
Initial Component Balance: As specified in the Preliminary Statement.
Initial Custodian Certification: As defined in Section 2.02.
Initial Optional Termination Date: The first Distribution Date following
the date on which the aggregate Stated Principal Balance of the Mortgage Loans
is equal to or less than 10% of the aggregate Stated Principal Balance thereof
as of the Cut-off Date.
Insurance Policy: With respect to any Mortgage Loan, any insurance
policy, including all names and endorsements thereto in effect, including any
replacement policy or policies for any Insurance Policies.
Insurance Proceeds: Proceeds paid by any Insurance Policy (excluding
proceeds required to be applied to the restoration and repair of the related
Mortgaged Property or released to the Mortgagor), in each case other than any
amount included in such Insurance Proceeds in respect of Insured Expenses and
the proceeds from any Limited Purpose Surety Bond.
Insured Expenses: Expenses covered by an Insurance Policy or any other
insurance policy with respect to the Mortgage Loans.
Interest Accrual Period: With respect to each Class of Delay
Certificates, its corresponding Subsidiary REMIC Regular Interest and any
Distribution Date, the calendar month prior to the month of such Distribution
Date. With respect to any Class of Non-Delay Certificates, its corresponding
Subsidiary REMIC Regular Interest and the Distribution Date in August 2006,
the 25 day period commencing on the Closing Date and ending on the day
immediately preceding such Distribution Date. With respect to any Class of
Non-Delay Certificates, its corresponding Subsidiary REMIC Regular Interest
and each Distribution Date following the Distribution Date in August 2006, the
one month period commencing on the Distribution Date in the calendar month
preceding the month in which such Distribution Date occurs and ending on the
day immediately preceding such Distribution Date. For purposes of computing
interest accruals on each Class of Non-Delay Certificates, each Interest
Accrual
29
Period has the actual number of days in such month and each year is assumed to
have 360 days. For purposes of computing interest accruals on each Class of
Delay Certificates, each Interest Accrual Period has 30 days in such month and
each year is assumed to have 360 days.
Interest Carry Forward Amount: With respect to any Distribution Date,
the amount, if any, by which the Interest Distribution Amount for that Class
of Certificates for the immediately preceding Distribution Date exceeds the
actual amount distributed on such Class in respect of interest on the
immediately preceding Distribution Date, together with any Interest Carry
Forward Amount with respect to such Class remaining unpaid from the previous
Distribution Date, plus interest accrued thereon at the related Pass-Through
Rate for the most recently ended Interest Accrual Period.
Interest Determination Date: With respect to any Interest Accrual Period
for any Class of LIBOR Certificates, the second Business Day prior to the
first day of such Interest Accrual Period.
Interest Distribution Amount: With respect to the Senior Certificates,
the Interest Distribution Amount. With respect to the Subordinated
Certificates, the Subordinated Interest Distribution Amount.
Interest Remittance Amount: For any Distribution Date, that portion of
the Available Distribution Amount for such Distribution Date that represents
interest received or advanced on the Mortgage Loans.
Interest Transfer Amount: Not applicable.
Investor Based Exemption: Any of Prohibited Transaction Class Exemption
("PTCE") 84-14 (for transactions by independent "qualified professional asset
managers"), PTCE 90-1 (for transactions by insurance company pooled separate
accounts), PTCE 91-38 (for transactions by bank collective investment funds),
PTCE 95-60 (for transactions by insurance company general accounts) or PTCE
96-23 (for transactions effected by "in house asset managers"), or any similar
exemption.
Last Scheduled Distribution Date: The Distribution Date in August 2036.
Latest Possible Maturity Date: The Distribution Date in August 2036.
LIBOR: The London interbank offered rate for one-month United States
dollar deposits calculated in the manner described in Section 5.09.
LIBOR Business Day: Any day on which banks in London, England and The
City of New York are open and conducting transactions in foreign currency and
exchange.
LIBOR Certificates: As specified in the Preliminary Statement.
Limited Purpose Surety Bond: Collectively, Ambac Assurance Corporation
Surety Bond No. AB0039BE and any other Limited Purpose Surety Bond securing
an Additional Collateral Mortgage Loan.
30
Liquidated Mortgage Loan: With respect to any Distribution Date, a
defaulted Mortgage Loan (including any REO Property) which was liquidated in
the calendar month preceding the month of such Distribution Date and as to
which the related Servicer has certified (in accordance with its Purchase and
Servicing Agreement) that it has received all amounts it expects to receive in
connection with the liquidation of such Mortgage Loan including the final
disposition of an REO Property.
Liquidation Proceeds: Amounts, including Insurance Proceeds, received in
connection with the partial or complete liquidation of defaulted Mortgage
Loans, whether through trustee's sale, foreclosure sale or otherwise or
amounts received in connection with any condemnation or partial release of a
Mortgaged Property and any other proceeds received in connection with an REO
Property.
Living Holders: Not applicable.
Loan-To-Value Ratio: With respect to any Mortgage Loan and as to any
date of determination, the fraction (expressed as a percentage) the numerator
of which is the principal balance of the related Mortgage Loan at such date of
determination and the denominator of which is the Appraised Value of the
related Mortgaged Property.
LPMI Mortgage Loan: Certain Mortgage Loans as to which the lender
(rather than the borrower) acquires the Primary Mortgage Insurance Policy and
charges the related borrower an interest premium.
Master REMIC: As described in the Preliminary Statement.
Master Servicer: Xxxxx Fargo Bank, National Association, a national
banking association organized under the laws of the United States in its
capacity as Master Servicer and any Person succeeding as Master Servicer
hereunder or any successor in interest, or if any successor master servicer
shall be appointed as herein provided, then such successor master servicer.
Master Servicer Compensation: With respect to any Master Servicer that
is a successor to Xxxxx Fargo Bank, National Association as Master Servicer,
the portion of the earnings on the funds on deposit in the Distribution
Account payable on each Distribution Date pursuant to Section 4.02(b)(ii)
hereof agreed to by and between such successor Master Servicer and the
successor securities administrator; provided, that the sum of such Master
Servicer Compensation and the Securities Administrator Compensation payable on
each Distribution Date shall not exceed the total earnings on funds in the
Distribution Account payable pursuant to Section 4.02(b)(ii) hereof earned
since the prior Distribution Date.
Memorandum: Not applicable.
MERS: Mortgage Electronic Registration Systems, Inc., a corporation
organized and existing under the laws of the State of Delaware, or any
successor to Mortgage Electronic Registration Systems, Inc.
MERS Mortgage Loan: Any Mortgage Loan registered with MERS on the
MERS(R) System.
31
MERS(R) System: The system of recording transfers of mortgages
electronically maintained by MERS.
MIN: The mortgage identification number for any MERS Mortgage Loan.
Minimum Auction Price: With respect to any Distribution Date on which an
Auction is being held, an amount equal to the sum of (a) 100% of the current
aggregate Stated Principal Balance of the Mortgage Loans, plus accrued
interest thereon, (b) the fair market value of any related REO Property in the
Trust Fund and all other property in the Trust Fund being purchased, (c) any
unreimbursed Servicing Advances related to the Mortgage Loans, (d) any
expenses incurred by the Auction Administrator in the Auction process and (e)
any Swap Termination Payment owed to the Swap Counterparty.
MOM Loan: Any Mortgage Loan as to which MERS is acting as mortgagee,
solely as nominee for the originator of such Mortgage Loan and its successors
and assigns.
Moody's: Xxxxx'x Investors Service, Inc., or any successor thereto. If
Xxxxx'x is designated as a Rating Agency in the Preliminary Statement, for
purposes of Section 11.07 the address for notices to Moody's shall be Xxxxx'x
Investors Service, Inc., 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Residential Pass-Through Monitoring, or such other address as
Moody's may hereafter furnish to the Depositor or the Master Servicer.
Mortgage: A mortgage, deed of trust or other instrument encumbering a
fee simple interest in real property securing a Mortgage Note, together with
improvements thereto.
Mortgage Documents: With respect to each Mortgage Loan, the mortgage
documents required to be delivered to the Custodian pursuant to each Custodial
Agreement.
Mortgage Loan: A Mortgage and the related notes or other evidences of
indebtedness secured by each such Mortgage conveyed, transferred, sold,
assigned to or deposited with the Trustee pursuant to Section 2.01 (including
any REO Property), including without limitation, each Mortgage Loan listed on
the Mortgage Loan Schedule, as amended from time to time.
Mortgage Loan Auction Price: The price, calculated as set forth in
Section 7.01(b), to be paid in connection with the purchase of the Mortgage
Loans by the Auction Purchaser.
Mortgage Loan Schedule: The schedule attached hereto as Schedule A,
which shall identify each Mortgage Loan, as such schedule may be amended by
the Depositor or a Servicer from time to time to reflect the addition of
Replacement Mortgage Loans to, or the deletion of Deleted Mortgage Loans from,
the Trust Fund. Such schedule shall, among other things (i) designate the
Servicer servicing such Mortgage Loan and the applicable Servicing Fee Rate;
(ii) [reserved], (iii) identify any LPMI Mortgage Loan and designate the rate
at which the premium for such insurance is calculated and (iv) separately
identify the Additional Collateral Mortgage Loans, if any.
Mortgage Note: The original executed note or other evidence of the
indebtedness of a Mortgagor secured by a Mortgage under a Mortgage Loan.
32
Mortgaged Property: The underlying property, including any Additional
Collateral, securing a Mortgage Loan which, with respect to a Cooperative
Loan, is the related Cooperative Shares and Proprietary Lease.
Mortgage Rate: As to any Mortgage Loan, the annual rate of interest
borne by the related Mortgage Notes.
MortgageIT Mortgage Loan: Each Mortgage Loan originated by MortgageIT,
Inc. and listed on the Mortgage Loan Schedule.
MortgageIT Purchase Agreement: The Mortgage Loan Purchase Agreement
listed in Exhibit E hereto between the Seller and MortgageIT, Inc.
Mortgagor: The obligor on a Mortgage Note.
MSMCI Mortgage Loan: A Mortgage Loan sold by the Seller to the
Depositor pursuant to the MSMCI Purchase Agreement.
MSMCI Purchase Agreement: The Mortgage Loan Purchase Agreement listed in
Exhibit E hereto between the Seller and the Depositor.
Net Liquidation Proceeds: With respect to any Liquidated Mortgage Loan
or any other disposition of related Mortgaged Property, the related
Liquidation Proceeds net of Advances, Servicer Advances, Servicing Fees and
any other accrued and unpaid servicing fees received and retained in
connection with the liquidation of such Mortgage Loan or Mortgaged Property.
Net Monthly Excess Cashflow: For any Distribution Date, the excess, if
any, of (x) the Available Distribution Amount for the Distribution Date over
(y) the sum for the Distribution Date of the aggregate of the Interest
Distribution Amounts payable to the holders of the Certificates, the Principal
Distribution Amount and any Net Swap Payments to the Swap Counterparty.
Net Mortgage Rate: With respect to any Mortgage Loan and any
Distribution Date, the related Mortgage Rate as of the Due Date in the month
preceding the month of such Distribution Date reduced by the Aggregate Expense
Rate for such Mortgage Loan.
Net Prepayment Interest Shortfalls: As to any Distribution Date, the
amount by which the aggregate of Prepayment Interest Shortfalls exceeds the
Compensating Interest Payments for that Distribution Date. Each Class' pro
rata share of the Net Interest Shortfalls on the Mortgage Loans shall be based
on the amount of interest the Class otherwise would have been entitled to
receive on such Distribution Date.
Net Swap Payment: With respect to any Distribution Date and payment paid
by the Supplemental Interest Trust to the Swap Counterparty, the excess, if
any, of the "Fixed Amount" (as defined in the Swap Agreement) with respect to
such Distribution Date over the "Floating Amount" (as defined in the Swap
Agreement) with respect to such Distribution Date. For the avoidance of doubt,
Net Swap Payments do not include Swap Termination Payments.
33
Net Swap Receipt: With respect to any Distribution Date and payment by
the Swap Counterparty to the Supplemental Interest Trust, the excess, if any,
of the "Floating Amount" (as defined in the Swap Agreement) with respect to
such Distribution Date over the "Fixed Amount" (as defined in the Swap
Agreement) with respect to such Distribution Date.
Net WAC Pass-Through Rate: For any Distribution Date, a per annum rate
equal to (i) the Weighted Average Net Mortgage Rate of the Mortgage Loans as
of the first day of the month preceding the month in which such Distribution
Date occurs minus (ii) the Swap Payment Rate, adjusted in each case to accrue
on the basis of a 360-day year and the actual number of days in the related
Interest Accrual Period, except that with respect to the August 2006
Distribution Date, the number of days in the related Interest Accrual Period
shall be 25.
Non-Book-Entry Certificate: Any Certificate other than a Book-Entry
Certificate.
Non-Delay Certificates: As specified in the Preliminary Statement.
Non-permitted Foreign Holder: As defined in Section 3.03(f).
Non-U.S. Person: Any person other than a "United States person" within
the meaning of Section 7701(a)(30) of the Code.
Nonrecoverable Advance: Any portion of an Advance or Servicer Advance
previously made or proposed to be made by the Master Servicer and/or a
Servicer (as certified in an Officer's Certificate of such Servicer), which in
the good faith judgment of such party, shall not be ultimately recoverable by
such party from the related Mortgagor, related Liquidation Proceeds or
otherwise.
Notional Amount: Not Applicable.
Notional Amount Certificates: Not Applicable.
Offered Certificates: As specified in the Preliminary Statement.
Offering Document: The Prospectus or the Memorandum, as applicable.
Officer's Certificate: A certificate signed by two Authorized Officers
of the Depositor or the Chairman of the Board, any Vice Chairman, the
President, any Vice President or any Assistant Vice President of the Master
Servicer or the Securities Administrator or in the case of any other Person,
signed by an authorized officer of such Person, and in each case delivered to
the Trustee or the Securities Administrator, as applicable signed by an
authorized officer of that Person.
Officer's Certificate of a Servicer: A certificate (i) signed by the
Chairman of the Board, the Vice Chairman of the Board, the President, a
Managing Director, a Vice President (however denominated), an Assistant Vice
President, the Treasurer, the Secretary, or one of the Assistant Treasurers or
Assistant Secretaries of a Servicer, or (ii) if provided for herein, signed by
a Servicing Officer, as the case may be, and delivered to the Trustee, the
Securities Administrator or the Master Servicer, as required hereby.
34
Opinion of Counsel: A written opinion of counsel, reasonably acceptable
in form and substance to the Trustee, the Securities Administrator or the
Master Servicer, as required hereby, and who may be in-house or outside
counsel to the Depositor, the Master Servicer, the Securities Administrator or
the Trustee but which must be Independent outside counsel with respect to any
such opinion of counsel concerning the transfer of any Residual Certificate or
concerning certain matters with respect to ERISA, or the taxation, or the
federal income tax status, of each REMIC.
Original Applicable Credit Support Percentage: Not applicable.
Originator: Any one of American Home Mortgage Corporation, FNBN, The
Hemisphere National Bank, MortgageIT, Inc. or Wachovia Mortgage Corporation,
as applicable.
Overcollateralization Increase Amount: with respect to any Distribution
Date will be the amount, if any, by which the Overcollateralization Target
Amount exceeds the Overcollateralized Amount for such Distribution Date
(calculated for this purpose only after assuming that 100% of the Principal
Remittance Amount on such Distribution Date has been distributed).
Overcollateralization Release Amount: For any Distribution Date, the
lesser of (1) the Principal Remittance Amount and (2) the excess of (a) the
Overcollateralized Amount over (b) the Overcollateralization Target Amount. In
addition, in connection with the final distribution on the Certificates
pursuant to Section 7.02 hereof, the Overcollateralization Release Amount for
the related Distribution Date shall also include the excess, if any of, (a)
the purchase price paid for the Mortgage Loans and any REO Properties related
to the Mortgage Loans pursuant to Section 7.01 hereof, less any costs incurred
by the Trust Fund in connection with the liquidation thereof pursuant to
Section 7.02 hereof, over (b) the amount distributed on the Certificates on
that Distribution Date.
Overcollateralization Target Amount: With respect to any Distribution
Date (i) prior to the Stepdown Date, the product of (x) 0.95% and (y) the
aggregate Stated Principal Balance of the Mortgage Loans as of the Cut-off
Date, (ii) on and after the Stepdown Date, provided that a Trigger Event is
not in effect, the lesser of (a) the product of (x) 1.90% and (y) the
aggregate Stated Principal Balance of the Mortgage Loans as of the related Due
Date and (b) the product of (x) 0.95% and (y) the aggregate Stated Principal
Balance of the Mortgage Loans as of the Cut-off Date and (iii) on and after
the Stepdown Date, if a Trigger Event is in effect, the Overcollateralization
Target Amount for the immediately preceding Distribution Date; provided,
however, that on each Distribution Date the Overcollateralization Target
Amount shall not be lower than $2,282,773.
Overcollateralized Amount: With respect to the Certificates as of the
Closing Date will be an amount equal to $6,196,892. With respect to any
Distribution Date following the Closing Date, an amount by which the aggregate
Stated Principal Balance of the Mortgage Loans immediately following the
Distribution Date exceeds the aggregate Class Principal Balances of the
Certificates after taking into account all payments of principal on such
Distribution Date.
Pass-Through Margin: For each Class of Certificates and the Interest
Accrual Period related to each Distribution Date, as follows:
35
(1) (2) (3)
------ ----- ------
Class A-1 0.17% 0.34% 5.570%
Class A-2 0.15% 0.30% 5.550%
Class A-3 0.09% 0.18% 5.490%
Class A-4 0.16% 0.32% 5.560%
Class A-5 0.26% 0.52% 5.660%
Class A-6 0.24% 0.48% 5.640%
Class M-1 0.30% 0.45% 5.700%
Class M-2 0.32% 0.48% 5.720%
Class M-3 0.34% 0.51% 5.740%
Class M-4 0.40% 0.60% 5.800%
Class M-5 0.42% 0.63% 5.820%
Class M-6 0.50% 0.75% 5.900%
Class B-1 1.00% 1.50% 6.400%
Class B-2 1.20% 1.80% 6.600%
Class B-3 2.20% 3.30% 7.600%
----------
(1) For the Interest Accrual Period for each Distribution Date occurring on
or prior to the Initial Optional Termination Date.
(2) For each Interest Accrual Period following the Initial Optional
Termination Date relating to the Certificates.
(3) The Pass-Through Rate for each Class of Certificates during the Interest
Accrual Period related to the first Distribution Date.
Pass-Through Rate: For any interest bearing Class of Certificates or
Component, the per annum rate set forth or calculated in the manner described
in the Preliminary Statement.
Paying Agent: Any paying agent appointed pursuant to Section 3.08. The
initial Paying Agent shall be the Securities Administrator under this
Agreement.
PCOAB: The Public Company Accounting Oversight Board.
Percentage Interest: As to any Certificate, the percentage interest
evidenced thereby in distributions required to be made on the related Class,
such percentage interest being set forth on the face thereof or equal to the
percentage obtained by dividing the initial principal balance or notional
amount, as applicable, of such Certificate by the aggregate of the Class
Principal Balance or Notional Amount, as applicable, of all Certificates of
the same Class.
Permitted Investments: At any time, any one or more of the following
obligations and securities:
(i) obligations of the United States or any agency thereof, provided
that such obligations are backed by the full faith and credit of the
United States;
(ii) general obligations of or obligations guaranteed by any state
of the United States or the District of Columbia receiving the highest
long-term debt rating of each
36
Rating Agency, or such lower rating as shall not result in the
downgrading or withdrawal of the ratings then assigned to the
Certificates by the Rating Agencies, as evidenced by a signed writing
delivered by each Rating Agency;
(iii) commercial or finance company paper which is then receiving
the highest commercial or finance company paper rating of each Rating
Agency rating such paper, or such lower rating as shall not result in the
downgrading or withdrawal of the ratings then assigned to the
Certificates by the Rating Agencies, as evidenced by a signed writing
delivered by each Rating Agency;
(iv) certificates of deposit, demand or time deposits, or bankers'
acceptances issued by any depository institution or trust company
incorporated under the laws of the United States or of any state thereof
and subject to supervision and examination by federal and/or state
banking authorities, provided that the commercial paper and/or long-term
unsecured debt obligations of such depository institution or trust
company (or in the case of the principal depository institution in a
holding company system, the commercial paper or long-term unsecured debt
obligations of such holding company, but only if Xxxxx'x is not the
applicable Rating Agency) are then rated one of the two highest long-term
and the highest short-term ratings of each Rating Agency for such
securities, or such lower ratings as shall not result in the downgrading
or withdrawal of the ratings then assigned to the Certificates by the
Rating Agencies, as evidenced by a signed writing delivered by each
Rating Agency;
(v) demand or time deposits or certificates of deposit issued by any
bank or trust company or savings institution to the extent that such
deposits are fully insured by the FDIC;
(vi) guaranteed reinvestment agreements issued by any bank,
insurance company or other corporation acceptable to the Rating Agencies
at the time of the issuance of such agreements, as evidenced by a signed
writing delivered by each Rating Agency;
(vii) repurchase obligations with respect to any security described
in clauses (i) and (ii) above, in either case entered into with a
depository institution or trust company (acting as principal) described
in clause (iv) above;
(viii) securities (other than stripped bonds, stripped coupons or
instruments sold at a purchase price in excess of 115% of the face amount
thereof) bearing interest or sold at a discount issued by any corporation
incorporated under the laws of the United States or any state thereof
which, at the time of such investment, have one of the two highest
ratings of each Rating Agency (except if the Rating Agency is Moody's,
such rating shall be the highest commercial paper rating of Moody's for
any such series), or such lower rating as shall not result in the
downgrading or withdrawal of the ratings then assigned to the
Certificates by the Rating Agencies, as evidenced by a signed writing
delivered by each Rating Agency;
37
(ix) interests in any money market fund which at the date of
acquisition of the interests in such fund and throughout the time such
interests are held in such fund has the highest applicable rating by each
Rating Agency rating such fund or such lower rating as shall not result
in a change in the rating then assigned to the Certificates by each
Rating Agency, as evidenced by a signed writing delivered by each Rating
Agency, including funds for which the Trustee, the Master Servicer, the
Securities Administrator or any of its Affiliates is investment manager
or adviser;
(x) short-term investment funds sponsored by any trust company or
national banking association incorporated under the laws of the United
States or any state thereof which on the date of acquisition has been
rated by each applicable Rating Agency in their respective highest
applicable rating category or such lower rating as shall not result in a
change in the rating then specified stated maturity and bearing interest
or sold at a discount acceptable to each Rating Agency as shall not
result in the downgrading or withdrawal of the ratings then assigned to
the Certificates by the Rating Agencies, as evidenced by a signed writing
delivered by each Rating Agency; and
(xi) such other investments having a specified stated maturity and
bearing interest or sold at a discount acceptable to the Rating Agencies
as shall not result in the downgrading or withdrawal of the ratings then
assigned to the Certificates by the Rating Agencies, as evidenced by a
signed writing delivered by each Rating Agency;
provided, that no such instrument shall be a Permitted Investment if (i) such
instrument evidences the right to receive interest only payments with respect
to the obligations underlying such instrument or (ii) such instrument would
require the Depositor to register as an investment company under the
Investment Company Act of 1940, as amended.
Person: Any individual, corporation, partnership, joint venture,
association, joint-stock company, limited liability company, trust,
unincorporated organization or government or any agency or political
subdivision thereof.
Plan: Any employee benefit plan or other plan or arrangement subject to
Section 406 of ERISA or Section 4975 of the Code, including individual
retirement accounts and annuities, Xxxxx plans and collective investment funds
and separate accounts in which such plans, accounts or arrangements are
invested.
Plan Asset Regulations: The Department of Labor regulations set forth
in 29 C.F.R. ss.2510.3-101.
Planned Balance: With respect to any group of Planned Principal Classes
or Components in the aggregate and any Distribution Date appearing in Schedule
B hereto, the Aggregate Planned Balance for such group and Distribution Date.
With respect to any other Planned Principal Class or Component and any
Distribution Date appearing in Schedule B hereto, the applicable amount
appearing opposite such Distribution Date for such Class or Component.
Planned Principal Classes: As specified in the Preliminary Statement.
38
Prepayment Interest Shortfall: With respect to each Mortgage Loan, the
amount of the shortfall in interest payable on such Mortgage Loan that occurs
as a result of the prepayment by the related Mortgagor of such Mortgage Loan
calculated in accordance with formula set forth in the related Purchase and
Servicing Agreement.
Prepayment Penalty: As to a Mortgage Loan, any penalty payable by a
Mortgagor in connection with certain partial prepayments and all prepayments
in full made within the related Prepayment Penalty Period, the Prepayment
Penalties with respect to each applicable Mortgage Loan so held by the Trust
Fund being identified in the Prepayment Penalty Schedule.
Prepayment Penalty Period: As to any Mortgage Loan, the period of time
during which a Prepayment Penalty may be imposed.
Prepayment Penalty Schedule: As of any date, the list of Prepayment
Penalties included in the Trust Fund on that date (including the Prepayment
Penalty summary attached thereto). The Prepayment Penalty Schedule shall set
forth the following information with respect to each Prepayment Penalty:
o the Mortgage Loan account number;
o a code indicating the type of Prepayment Penalty;
o the state of origination in which the related Mortgage Property is
located;
o the first date on which a monthly payment is or was due under the
related Mortgage Note;
o the term of the Prepayment Penalty;
o the original principal amount of the related Mortgage Loan; and
o the Cut-off Date Principal Balance of the related Mortgage Loan.
The Prepayment Penalty Schedule shall be amended from time to time by
the Seller in accordance with this Agreement.
Prepayment Period: With respect to any Mortgage Loan and any
Distribution Date, the calendar month preceding that Distribution Date.
Prepayment Shift Percentage: Not applicable.
Primary Mortgage Insurance Policy: Each policy of primary mortgage
guaranty insurance or any replacement policy therefor with respect to any
Mortgage Loan.
Principal Distribution Amount: For any Distribution Date will be the sum
of the Basic Principal Distribution Amount and the Extra Principal
Distribution Amount, in each case for that Distribution Date, and, with
respect to the first Distribution Date, the $100 deposited in respect of the
Class A-R Certificates pursuant to Section 2.01 hereof.
39
Principal Prepayment: Any payment of principal by a Mortgagor on a
Mortgage Loan that is received in advance of its scheduled Due Date and is not
accompanied by an amount representing scheduled interest due on any date or
dates in any month or months subsequent to the month of prepayment.
Principal Prepayment in Full: Any Principal Prepayment made by a
Mortgagor of the entire principal balance of a Mortgage Loan.
Principal Reductions: Not applicable.
Principal Remittance Amount: For the Certificates and any
Distribution Date, the sum of
(i) the principal portion of all Scheduled Payments on the 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 Mortgage Loan (or, in the case of a substitution, certain
amounts representing a principal adjustment as required by this Agreement)
during the related Prepayment Period; and
(iii) the principal portion of all other unscheduled collections,
including Insurance Proceeds, condemnation proceeds, Liquidation Proceeds and
all partial Principal Prepayments and Principal Prepayments in full, received
during the related Prepayment Period, to the extent applied as recoveries of
principal on the Mortgage Loans, provided, that in no event will the Principal
Remittance Amount with respect to any Distribution Date be (x) less than zero
or (y) greater than the then outstanding aggregate Class Principal Balance of
the Certificates.
Priority Amount: Not applicable.
Priority Percentage: Not applicable.
Private Certificate: As specified in the Preliminary Statement.
Pro Rata Share: Not applicable.
Pro Rata Subordinated Percentage: Not applicable.
Proceeding: Any suit in equity, action at law or other judicial or
administrative proceeding.
Proprietary Lease: With respect to any Cooperative Property, a lease
or occupancy agreement between a Cooperative Corporation and a holder of
related Cooperative Shares.
Prospectus: The prospectus supplement dated July 26, 2006, together with
the accompanying prospectus dated March 14, 2006, relating to the
Certificates.
Purchase and Servicing Agreements: Collectively, the mortgage loan
purchase and servicing agreements, each as amended by the related
Acknowledgement, listed in Exhibit E
40
hereto, as each such agreement may be amended or supplemented from time to
time as permitted hereunder.
Purchase Date: As defined in Section 7.01(c).
Purchase Price: With respect to any Mortgage Loan required or permitted
to be purchased by the Seller or Depositor pursuant to this Agreement, or by
the related Originator or Servicer pursuant to the related Purchase and
Servicing Agreement, an amount equal to the sum of (i) 100% of the unpaid
principal balance of the Mortgage Loan on the date of such purchase and (ii)
accrued interest thereon at the applicable Net Mortgage Rate from the date
through which interest was last paid by the Mortgagor to the Due Date in the
month in which the Purchase Price is to be distributed to Certificateholders,
or such other amount as may be specified in the related Purchase and Servicing
Agreement and (iii) costs and damages incurred by the Trust Fund in connection
with a repurchase pursuant to Section 2.05 hereof that arises out of a
violation of any predatory or abusive lending law with respect to the related
Mortgage Loan.
Rating Agency: Each of the Rating Agencies specified in the Preliminary
Statement. If any such organization or a successor is no longer in existence,
"Rating Agency" shall be such nationally recognized statistical rating
organization, or other comparable Person, as is designated by the Depositor,
notice of which designation shall be given to the Trustee. References herein
to a given rating category of a Rating Agency shall mean such rating category
without giving effect to any modifiers.
Realized Loss: With respect to each Liquidated Mortgage Loan, an amount
(not less than zero or more than the Stated Principal Balance of the related
Mortgage Loan) as of the date of such liquidation, equal to (i) the Stated
Principal Balance of the Liquidated Mortgage Loan as of the date of such
liquidation, plus (ii) interest at the Net Mortgage Rate from the Due Date as
to which interest was last paid or advanced (and not reimbursed) to
Certificateholders up to the Due Date in the month in which Liquidation
Proceeds are required to be distributed on the Stated Principal Balance of
such Liquidated Mortgage Loan from time to time, minus (iii) the Liquidation
Proceeds, if any, received during the month in which such liquidation
occurred, to the extent applied as recoveries of interest at the Net Mortgage
Rate and to principal of the Liquidated Mortgage Loan. With respect to each
Mortgage Loan which has become the subject of a Deficient Valuation, if the
principal amount due under the related Mortgage Note has been reduced, the
difference between the principal balance of the Mortgage Loan outstanding
immediately prior to such Deficient Valuation and the principal balance of the
Mortgage Loan as reduced by the Deficient Valuation. With respect to each
Mortgage Loan which has become the subject of a Debt Service Reduction and any
Distribution Date, the amount, if any, by which the principal portion of the
related Scheduled Payment has been reduced.
To the extent the Master Servicer or a Servicer receives Subsequent
Recoveries with respect to any Mortgage Loan, the amount of the Realized Loss
with respect to that Mortgage Loan will be reduced by such Subsequent
Recoveries.
Recognition Agreement: An agreement among a Cooperative Corporation, a
lender and a Mortgagor with respect to a Cooperative Loan whereby such parties
(i) acknowledge that such
41
lender may make, or intends to make, such Cooperative Loan, and (ii) make
certain agreements with respect to such Cooperative Loan.
Record Date: As to any Distribution Date (i) with respect to the
Non-Delay Certificates, the last Business Day preceding such Distribution Date
(or the Closing Date, in the case of the first Distribution Date) unless such
Certificates shall no longer be Book-Entry Certificates, in which case the
Record Date shall be the last Business Day of the month preceding the month of
such Distribution Date and (ii) in the case of the Delay Certificates
(including the Non-Delay Certificates that are subsequently reissued as
Definitive Certificates), the last Business Day of the month preceding the
month of each Distribution Date.
Redemption Price: With respect to any Distribution Date, the sum of (a)
100% of the aggregate Stated Principal Balance of the Mortgage Loans as of the
related Due Date (after giving effect to Principal Prepayments received in the
related Prepayment Period), (b) the fair market value of any related REO
Property, (c) all amounts (including, without limitation, all previously
unreimbursed Advances and Servicer Advances and accrued and unpaid Servicing
Fees ) payable or reimbursable to the Trustee, the Securities Administrator,
the Master Servicer, the Servicers or the Custodian pursuant to this Agreement,
the Purchase and Servicing Agreements, or the Custodial Agreement (to the
extent such amounts are not paid to the Custodian by the Seller) related to
the Mortgage Loans and (d) any Swap Termination Payment owed to the Swap
Counterparty.
Refinancing Mortgage Loan: Any Mortgage Loan originated in connection
with the refinancing of an existing mortgage loan.
Regular Certificates: As specified in the Preliminary Statement.
Regulation AB: Subpart 229.1100 - Asset Backed Securities (Regulation
AB), 17 C.F.R. ss.ss.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.
Relevant Servicing Criteria: The Servicing Criteria applicable to the
various parties, as set forth on Exhibit O 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, any Servicer or any
Custodian, 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 (formerly known as the
Soldiers' and Sailors' Civil Relief Act of 1940), as amended, and any similar
state laws.
Relief Act Interest Shortfalls: With respect to any Distribution Date
and any Mortgage Loan as to which there has been a reduction in the amount of
interest collectible thereon for the most recently ended calendar month as a
result of the application of the Relief Act, the amount, if any, by which (i)
interest collectible on such Mortgage Loan for the most recently ended
42
calendar month is less than (ii) interest accrued thereon for such month
pursuant to the Mortgage Note.
Relief Act Reduction: A reduction in the amount of the monthly interest
payment on a Mortgage Loan pursuant to the Servicemembers' Civil Relief Act.
REMIC: Each pool of assets in the Trust Fund designated as a REMIC as
described in the Preliminary Statement.
REMIC 1A: As specified in the Preliminary Statement.
REMIC 1A Interest: As specified in the Preliminary Statement.
REMIC 1A Regular Interest: As specified in the Preliminary Statement.
REMIC 1B: As specified in the Preliminary Statement.
REMIC 1B Interest: As specified in the Preliminary Statement.
REMIC 1B Regular Interest: As specified in the Preliminary Statement.
REMIC 1C: As specified in the Preliminary Statement.
REMIC 1C Interest: As specified in the Preliminary Statement.
REMIC 1C Regular Interest: As specified in the Preliminary Statement.
REMIC 2: As specified in the Preliminary Statement.
REMIC 2 Interest: As specified in the Preliminary Statement.
REMIC 2 Regular Interest: As specified in the Preliminary Statement.
REMIC Provisions: The provisions of the federal income tax law relating
to real estate mortgage investment conduits, which appear at Sections 860A
through 860G of the Code, and related provisions, and regulations, including
proposed regulations and rulings, and administrative pronouncements
promulgated thereunder, as the foregoing may be in effect from time to time.
REO Property: A Mortgaged Property acquired by the Trust Fund through
foreclosure or deed-in-lieu of foreclosure in connection with a defaulted
Mortgage Loan or otherwise treated as having been acquired pursuant to the
REMIC Provisions.
Replacement Mortgage Loan: A mortgage loan substituted by an Originator
or the Seller for a Deleted Mortgage Loan which must, on the date of such
substitution, as confirmed in a Request for Release, substantially in the form
attached to the related Custodial Agreement, (i) have a Stated Principal
Balance, after deduction of all Scheduled Payments due in the month of
substitution, not in excess of the Stated Principal Balance of the Deleted
Mortgage Loan, (ii) if such Mortgage Loan is a fixed-rate Mortgage Loan, have
a Mortgage Rate not less than (and not
43
more than two percentage points greater than) the mortgage rate of the Deleted
Mortgage Loan, (iii) if such Mortgage Loan is an adjustable-rate Mortgage
Loan, have a Mortgage Rate not less than (and not more than two percentage
points greater than) the mortgage rate of the Deleted Mortgage Loan, (iv) have
a Loan-to-Value Ratio equal to or less than that of the Deleted Mortgage Loan,
(v) have a remaining term to maturity not greater than (and not more than one
year less than) that of the Deleted Mortgage Loan, (vi) is otherwise
acceptable to the Seller, (vii) if such Mortgage Loan is an adjustable-rate
Mortgage Loan, have the same adjustment date as that of the Deleted Mortgage
Loan, (viii) if such Mortgage Loan is an adjustable-rate Mortgage Loan, have a
minimum Mortgage Rate not less than that of the Deleted Mortgage Loan, (ix) if
such Mortgage Loan is an adjustable-rate Mortgage Loan, have the same Index as
that of the Deleted Mortgage Loan, (x) comply with all of the representations
and warranties set forth in the related underlying servicing agreement, as
modified by any related assignment thereof, and (xi) shall be accompanied by
an Opinion of Counsel that such Replacement Mortgage Loan would not adversely
affect the REMIC status of any REMIC created hereunder or would not otherwise
be prohibited by this Pooling and Servicing Agreement.
Replacement Swap Counterparty Payment: With respect to the Swap
Agreement, any payments that have been received by the Trust as a result of
entering into a replacement interest rate swap agreement following an
Additional Termination Event described in Part 1(h)(ii) of the Swap Agreement.
Reportable Event: As defined in Section 12.03 hereof.
Reporting Party: The Depositor, any Originator, the Master Servicer, any
Custodian, any Servicer, any originator identified in the Prospectus
Supplement, the Swap Counterparty, any credit enhancement provider described
herein and any other material transaction party as may be mutually agreed
between the Depositor and the Master Servicer from time to time for the
purpose of complying with the requirements of the Commission.
Reporting Subcontractor: With respect to the Master Servicer, the
Securities Administrator or any Custodian, any Subcontractor determined by
such Person pursuant to Section 12.08(b) to be "participating in the servicing
function" within the meaning of Item 1122 of Regulation AB. References to a
Reporting Subcontractor shall refer only to the Subcontractor of such Person
and shall not refer to Subcontractors generally.
Repurchase Price: With respect to any Mortgage Loan purchased from the
Trust pursuant to Section 2.07 hereof, 100% of the unpaid principal balance of
such Mortgage Loan, plus all related accrued and unpaid interest, and the
amount of any unreimbursed Servicing Advances made by the Servicers or the
Master Servicer related to the Mortgage Loan.
Request for Release: The Request for Release submitted by the applicable
Servicer to the Trustee or the applicable Custodian, as applicable,
substantially in the form of Exhibit M or the equivalent form under the
applicable Custodial Agreement.
Required Distributions: Not applicable.
Residual Certificate: The Class A-R Certificates.
Responsible Officer: With respect to the Trustee, any officer in the
corporate trust department or similar group of the Trustee with direct
responsibility for the administration of this Agreement and also, with respect
to a particular corporate trust matter, any other officer to whom such matter
is referred because of his or her knowledge of and familiarity with the
particular
44
subject. With respect to the Master Servicer, any officer in its master
servicing operations with direct responsibility for the Administration of this
Agreement. With respect to the Securities Administrator, any officer in the
corporate trust department or similar group of the Securities Administrator
with direct responsibility for the administration of this Agreement and also,
with respect to a particular corporate trust matter, any other officer to whom
such matter is referred because of his or her knowledge of and familiarity
with the particular subject.
Restricted Classes: As defined in Section 5.02(e).
Restricted Global Security: As defined in Section 3.01(c).
Rule 144A: Rule 144A under the Securities Act.
SAIF: The Saving's Association Insurance Fund, or any successor
thereto.
Xxxxxxxx-Xxxxx Act: 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 covering the
activities of all Servicing Function Participants and signed by a senior
officer of the Master Servicer in charge of the master servicing function 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.
S&P: Standard & Poor's, a division of The XxXxxx-Xxxx Companies, Inc. If
S&P is designated as a Rating Agency in the Preliminary Statement, for
purposes of Section 11.07 the address for notices to S&P shall be Standard &
Poor's, 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Mortgage
Surveillance Monitoring, or such other address as S&P may hereafter furnish to
the Depositor and the Master Servicer.
Scheduled Balances: Not applicable.
Scheduled Payment: The scheduled monthly payment on a Mortgage Loan due
on any Due Date allocable to principal and/or interest on such Mortgage Loan
which, unless otherwise specified in the related Purchase and Servicing
Agreement, shall give effect to any related Debt Service Reduction and any
Deficient Valuation that affects the amount of the monthly payment due on such
Mortgage Loan.
Scheduled Principal Classes: As specified in the Preliminary Statement.
Scheduled Principal Distribution Amount: Not applicable.
Securities Act: The Securities Act of 1933, as amended, and the rules
and regulations thereunder.
Securities Administrator: Xxxxx Fargo Bank, National Association, not in
its individual capacity but solely as Securities Administrator, or any
successor in interest, or if any successor
45
Securities Administrator shall be appointed as herein provided, then such
successor Securities Administrator.
Securities Administrator Compensation: With respect to any Securities
Administrator that is a successor to Xxxxx Fargo Bank, National Association as
Securities Administrator, the portion of the earnings on the funds on deposit
in the Distribution Account payable on each Distribution Date pursuant to
Section 4.02(b)(ii) hereof agreed to by and between such Securities
Administrator and the successor master servicer; provided, that (x) such
Securities Administrator Compensation payable on each Distribution Date shall
equal at least one day's earnings accrued since the prior Distribution Date
and (y) the sum of such Securities Administrator Compensation and the Master
Servicer Compensation payable on each Distribution Date shall not exceed the
total earnings on the funds on deposit in the Distribution Account payable on
each Distribution Date pursuant to Section 4.02(b)(ii) hereof earned since the
prior Distribution Date.
Seller: Xxxxxx Xxxxxxx Mortgage Capital Inc., a New York corporation.
Senior Certificates: As specified in the Preliminary Statement.
Senior Credit Support Depletion Date: Not Applicable.
Senior Defaulted Swap Termination Payment: The lesser of (i) any
Replacement Swap Counterparty Payment, and (ii) any Swap Termination Payment
owed to the Swap Counterparty.
Senior Enhancement Percentage: For any Distribution Date, the percentage
obtained by dividing (x) the sum of (i) the aggregate Class Principal Balance
of the Subordinated Certificates and (ii) the Overcollateralized Amount by (y)
the aggregate Stated Principal Balance of the Mortgage Loans as of the end of
the related Due Period, calculated after taking into account distributions of
principal on the Mortgage Loans and distribution of the Principal Distribution
Amount to the holders of the Certificates then entitled to distributions of
principal on such Distribution Date.
Sequential Trigger Event: With respect to any Distribution Date, a
Sequential Trigger Event is in effect if (a) with respect to any Distribution
Date occurring before August 2008, the circumstances in which the aggregate
amount of Realized Losses incurred since the Cut-off Date through the last day
of the related Prepayment Period divided by the aggregate Stated Principal
Balance of the Mortgage Loans as of the Cut-off Date exceeds 0.25% and (b)
with respect to any Distribution Date occurring in or after August 2008, a
Trigger Event is in effect.
Servicer: Each Servicer under a Purchase and Servicing Agreement, and
its respective successors and assigns. As of the Closing Date, the Servicers
of the Mortgage Loans shall be GMAC Mortgage Corporation, The Hemisphere
National Bank and Wachovia Mortgage Corporation.
Servicer Advance: A "Servicer Advance" or "Servicing Advance" as defined
in the applicable Purchase and Servicing Agreement.
Servicing Criteria: The "servicing criteria" set forth in Item 1122(d)
of Regulation AB, as the same may be amended from time to time.
46
Servicing Fee: As to any Distribution Date and each Mortgage Loan, an
amount equal to the product of (a) one-twelfth of the related Servicing Fee
Rate and (b) the Stated Principal Balance of such Mortgage Loan as of the
first day of the related Due Period.
Servicing Fee Rate: With respect to each Mortgage Loan and any
Distribution Date, the per annum rate specified in the related Purchase and
Servicing Agreement.
Servicing Function Participant: Any Sub-Servicer, Subcontractor or any
other Person, other than each Servicer, the Master Servicer, the Trustee, the
Securities Administrator and any Custodian, that is performing activities
addressed by the Servicing Criteria.
Servicing Officer: Any officer of the related Servicer involved in, or
responsible for, the administration and servicing of the related Mortgage
Loans whose name and facsimile signature appear on a list of servicing
officers furnished to the Master Servicer by the related Servicer on the
Closing Date pursuant to the related Purchase and Servicing Agreement, as such
list may from time to time be amended.
Shift Percentage: Not applicable.
Similar Law: As defined in Section 3.03(d) hereof.
Startup Day: The day designated as such pursuant to Section 10.01(b)
hereof.
Stated Principal Balance: As to any Mortgage Loan and Due Date, the
unpaid principal balance of such Mortgage Loan as of such Due Date as
specified in the amortization schedule at the time relating thereto (before
any adjustment to such amortization schedule by reason of any moratorium or
similar waiver or grace period) after giving effect to any previous partial
Principal Prepayments and Liquidation Proceeds allocable to principal (other
than with respect to any Liquidated Mortgage Loan) and to the payment of
principal due on such Due Date and irrespective of any delinquency in payment
by the related Mortgagor.
Stepdown Date: The later to occur of:
(1) the earlier to occur of
(x) the Distribution Date in August 2009, and
(y) the Distribution Date on which the aggregate Class Principal
Balance of the Class A Certificates is reduced to zero; and
(2) the first Distribution Date on which the Class A 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 or any Net Swap Receipts to
the holders of the Certificates on the Distribution Date) is greater than or
equal to 14.10%.
Subcontractor: Any vendor, subcontractor or other Person that is not
responsible for the overall servicing (as "servicing" is commonly understood
by participants in the mortgage-backed
47
securities market) of Mortgage Loans but performs one or more discrete
functions identified in Item 1122(d) of Regulation AB with respect to Mortgage
Loans under the direction or authority of any Servicer (including a
Sub-Servicer of any Servicer), the Securities Administrator, the Master
Servicer, the Trustee or any Custodian, as the case may be.
Subordinated Certificates: As specified in the Preliminary Statement.
Subordinated Interest Distribution Amount: With respect to any Class of
Subordinated Certificates and any Distribution Date, interest accrued during
the related Interest Accrual Period on the related Class Principal Balance of
that Class immediately prior to the Distribution Date at the Pass-Through Rate
for that Class reduced (to an amount not less than zero), in the case of such
Class, by the allocable share, if any, for that Class of Prepayment Interest
Shortfalls on the Mortgage Loans to the extent not covered by (x) Compensating
Interest paid by the Master Servicer or the Servicers for the Mortgage Loans
and (y) Relief Act Interest Shortfalls on the Mortgage Loans.
Subsequent Recoveries: As to any Distribution Date, with respect to a
Liquidated Mortgage Loan that resulted in a Realized Loss in a prior calendar
month, amounts received by the Securities Administrator from the related
Servicer (net of any related expenses permitted to be reimbursed pursuant to
Section 4.02) specifically related to such Liquidated Mortgage Loan.
Sub-Servicer: Any Person that (i) is considered to be a Servicing
Function Participant, (ii) services Mortgage Loans on behalf of any Servicer,
and (iii) is responsible for the performance (whether directly or through
sub-servicers or Subcontractors) of Servicing functions required to be
performed under this Agreement, any related Servicing Agreement or any
sub-servicing agreement that are identified in Item 1122(d) of Regulation AB.
Substitution Adjustment Amount: As defined in the second paragraph of
Section 2.05(b).
Substitution Event: As defined in the Swap Agreement.
Supplemental Interest Trust: The corpus of a trust created pursuant to
Section 5.10 hereof, consisting of the Swap Agreement and amounts on deposit
in the Swap Account, subject to the obligation to pay amounts specified in
Section 5.10 hereof.
Swap Account: As defined in Section 5.10 hereof.
Swap Agreement: The ISDA Master Agreement (including the Schedule
thereto and the transaction evidenced by the related Confirmation by and
between the Securities Administrator on behalf of the Trust and the Swap
Counterparty), assigned to the Supplemental Interest Trust for the benefit of
the Certificates.
Swap Counterparty: Xxxxxx Xxxxxxx Capital Services Inc., a Delaware
limited partnership, and its successors in interest, and any successor swap
provider under any replacement Swap Agreement.
48
Swap Payment Allocation: For any Class of Certificates and any
Distribution Date is that Class's pro rata share of the Net Swap Receipts, if
any, for that Distribution Date, based on the respective Class Principal
Balances of the Certificates.
Swap Payment Rate: For any Distribution Date is a fraction expressed as
a percentage, the numerator of which is any Net Swap Payment or Swap
Termination Payment (other than any Defaulted Swap Termination Payment) owed
to the Swap Counterparty for such Distribution Date, and the denominator of
which is the Stated Principal Balance of the Mortgage Loans as of the first
day of the related Due Period, multiplied by 12.
Swap Termination Date: With respect to each Distribution Date under the
Swap Agreement, to and including the Distribution Date in June 2011.
Swap Termination Payment: Any payment payable by the Supplemental
Interest Trust or the Swap Counterparty upon termination of the Swap Agreement
as a result of an Event of Default (as defined in the Swap Agreement) or a
Termination Event (as defined in the Swap Agreement).
Targeted Balance: With respect to any group of Targeted Principal
Classes or Components in the aggregate and any Distribution Date appearing in
Schedule B hereto, the Aggregate Targeted Balance for such group and
Distribution Date. With respect to any other Targeted Principal Class or
Component and any Distribution Date appearing in Schedule B hereto, the
applicable amount appearing opposite such Distribution Date for such Class or
Component.
Tax Matters Person: The person designated as "tax matters person" in the
manner provided under Treasury regulation ss. 1.860F-4(d) and temporary
Treasury regulation ss.301.6231(a)(7)1T. Initially, the Tax Matters Person
shall be the Securities Administrator.
Tax Matters Person Certificate: The Class A-R Certificate with a
Denomination of $0.01.
Three Month Rolling Average: With respect to the end of the Due Period
related to any Distribution Date, will equal the rolling 3 month average
percentage of the aggregate Stated Principal Balance of the Mortgage Loans
that are 60 or more days Delinquent (including Mortgage Loans in foreclosure,
REO Property or discharged in bankruptcy).
Trigger Event: With respect to any Distribution Date, a Trigger Event is
in effect if (x) the Three Month Rolling Average with respect to the Mortgage
Loans exceeds 40.00% of the Senior Enhancement Percentage for the prior
Distribution Date, or (y) the aggregate amount of Realized Losses on the
Mortgage Loans incurred since the Cut-off Date through the last day of the
related Due Period divided by the aggregate outstanding principal balance of
the Mortgage Loans as of the Cut-off exceeds the applicable percentages set
forth below with respect to such Distribution Date:
49
Distribution Date Percentage
----------------- ----------
August 2008 --July 2009........... 0.25% for the first month, plus an
additional 1/12th of 0.40% for each month
thereafter
August 2009 --July 2010........... 0.65% for the first month, plus an
additional 1/12th of 0.50% for each month
thereafter
August 2010 --July 2011........... 1.15% for the first month, plus an
additional 1/12th of 0.50% for each month
thereafter
August 2011 --July 2012........... 1.65% for the first month, plus an
additional 1/12th of 0.30% for each month
thereafter
August 2012 and thereafter....... 1.95%
Trust: Xxxxxx Xxxxxxx Mortgage Loan Trust 2006-9AR.
Trust Fund: The corpus of the trust created pursuant to this Agreement
consisting of (i) the Mortgage Loans and all interest and principal received
on or with respect thereto after the Cut-off Date (other than Scheduled
Payments due on or prior to the Cut-off Date) to the extent not applied in
computing the Cut-off Date Principal Balance thereof; (ii) all cash,
instruments or property held or required to be held in the Custodial Accounts
and the Distribution Account and all amounts deposited therein pursuant to the
applicable provisions of this Agreement; (iii) property that secured a
Mortgage Loan and has been acquired by foreclosure, deed-in-lieu of
foreclosure or otherwise; (iv) the Depositor's rights assigned to the Trustee
under the Purchase and Servicing Agreements, as modified by the
Acknowledgements and under the Custodial Agreements; (v) the pledge, control
and guaranty agreements and the Limited Purpose Surety Bond relating to the
Additional Collateral Mortgage Loans; (vi) all insurance policies related to
the Mortgage Loans and any insurance proceeds; and (vii) all proceeds of the
conversion, voluntary or involuntary, of any of the foregoing.
Trustee: LaSalle Bank National Association, a national banking
association, organized under the laws of the United States and any Person
succeeding the Trustee hereunder, or if any successor trustee or any
co-trustee shall be appointed as herein provided, then such successor trustee
and such co-trustee, as the case may be.
Trustee Mortgage Files: With respect to each Mortgage Loan, the Mortgage
Documents to be retained in the custody and possession of the Trustee or
Custodian on behalf of the Trustee identified in Section 2.01(a) hereof.
UCC: The Uniform Commercial Code as enacted in the relevant
jurisdiction.
Underwriter's Exemption: Prohibited Transaction Exemption 2002-41, 67
Fed. Reg. 54487 (2002), as amended (or any successor thereto), or any
substantially similar administrative exemption granted by the U.S. Department
of Labor.
Underwriter: As specified in the Preliminary Statement.
Underwriting Agreement: The Underwriting Agreement, dated July 26,
2006, among the Seller, the Depositor and the Underwriter.
50
Uniform Commercial Code: The Uniform Commercial Code as in effect in
any applicable jurisdiction from time to time.
Unpaid Interest Shortfall Amount: The sum of Relief Act Interest
Shortfalls and net prepayment interest shortfalls on the Mortgage Loans
allocated to such Class of Certificates on that Distribution Date and such
amounts from any prior Distribution Date remaining unpaid.
Unpaid Realized Loss Amount: The portion of any Realized Losses
previously allocated to that Class remaining unpaid from prior Distribution
Dates.
Unscheduled Principal Distribution Amount: Not applicable.
Voting Interests: The portion of the voting rights of all the
Certificates that is allocated to any Certificate for purposes of the voting
provisions of this Agreement. At all times during the term of this Agreement,
1.00% of all Voting Interests shall be allocated to the Class OC Certificates,
any Class of Notional Amount Certificates and the Class A-R Certificates.
Voting Interests shall be allocated among all other Classes of Certificates
pro rata based on Class Principal Balances for each Class then outstanding.
Voting Interests shall be allocated among the Certificates within each such
Class in proportion to their Certificate Balances or Percentage Interests.
Wachovia Originated Mortgage Loan: Each Mortgage Loan originated by
Wachovia Mortgage Corporation and serviced by GMAC Mortgage Corporation and
listed on the Mortgage Loan Schedule.
Wachovia Serviced Mortgage Loan: Each Mortgage Loan originated by
Wachovia Mortgage Corporation and serviced by Wachovia Mortgage Corporation
and listed on the Mortgage Loan Schedule.
Wachovia Purchase Agreement: The Seller's Purchase, Warranties and
Servicing Agreement listed in Exhibit E hereto between the Seller and
Wachovia Mortgage Corporation.
Wachovia Servicing Agreement: The Servicing Agreement listed in
Exhibit E hereto between the Seller and Wachovia Mortgage Corporation.
Weighted Average Net Mortgage Rate: As to any Distribution Date, the
average of the Net Mortgage Rate of each Mortgage Loan, weighted on the basis
of its Stated Principal Balance as of the end of the Prepayment Period related
to the immediately preceding Distribution Date.
51
ARTICLE II
DECLARATION OF TRUST;
ISSUANCE OF CERTIFICATES
Section 2.01. Creation and Declaration of Trust Fund; Conveyance of
Mortgage Loans.
(a) Concurrently with the execution and delivery of this Agreement, the
Depositor does hereby transfer, assign, set over, deposit with and otherwise
convey to the Trustee, without recourse, subject to Sections 2.02 and 2.05, in
trust, all the right, title and interest of the Depositor in and to the Trust
Fund. Such conveyance includes, without limitation, (i) the Mortgage Loans,
including the right to all payments of principal and interest received on or
with respect to the Mortgage Loans on and after the Cut-off Date (other than
Scheduled Payments due on or before such date), and all such payments due
after such date but received prior to such date and intended by the related
Mortgagors to be applied after such date; (ii) all of the Depositor's right,
title and interest in and to all amounts from time to time credited to and the
proceeds of the Distribution Account, any Custodial Accounts or any Escrow
Account established with respect to the Mortgage Loans; (iii) all of the
rights and obligations of the Depositor as assignee of the Seller with respect
to the Seller's rights and obligations under the Purchase and Servicing
Agreements pursuant to the Acknowledgements; (iv) all of the Depositor's
right, title or interest in REO Property and the proceeds thereof; (v) all of
the Depositor's rights under any Insurance Policies related to the Mortgage
Loans; (vi) $1,000 (which amount has been delivered by the Depositor to the
Securities Administrator to be held in the Distribution Account until
distributed to the Holders of the Class P Certificates pursuant to Section
5.02(a)) and $100, plus interest, (which amount has been delivered by the
Depositor to the Securities Administrator to be held in the Distribution
Account until distributed to the Holders of the Class A-R Certificates
pursuant to Section 5.02(a)); and (vii) if applicable, the Depositor's
security interest in any collateral pledged to secure the Mortgage Loans,
including the Mortgaged Properties and any Additional Collateral relating to
the Additional Collateral Mortgage Loans, including, but not limited to, the
pledge, control and guaranty agreements and the Limited Purpose Surety Bond,
to have and to hold, in trust; and the Trustee declares that, subject to the
review provided for in Section 2.02, it has received and shall hold the Trust
Fund, as trustee, in trust, for the benefit and use of the Holders of the
Certificates and for the purposes and subject to the terms and conditions set
forth in this Agreement, and, concurrently with such receipt, has caused to be
executed, authenticated and delivered to or upon the order of the Depositor,
in exchange for the Trust Fund, Certificates in the authorized denominations
evidencing the entire ownership of the Trust Fund.
The foregoing sale, transfer, assignment, set-over, deposit and
conveyance does not and is not intended to result in the creation or
assumption by the Trustee of any obligation of the Depositor, the Seller or
any other Person in connection with the Mortgage Loans or any other agreement
or instrument relating thereto except as specifically set forth therein.
In connection with such transfer and assignment of the Mortgage Loans,
the Depositor shall cause to be delivered and the Custodian acting on the
Trustee's behalf will continue to hold the documents or instruments listed
below
52
with respect to each Mortgage Loan (each, a "Trustee Mortgage File") so
transferred and assigned:
(i) with respect to each Mortgage Loan, the original Mortgage Note
endorsed without recourse in proper form to the order of "LaSalle Bank
National Association, as Trustee of Xxxxxx Xxxxxxx Mortgage Loan Trust
2006-9AR, Mortgage Pass-Through Certificates, without recourse", or in blank
(in each case, with all necessary intervening endorsements, as applicable);
(ii) with respect to each Mortgage Loan (other than a Cooperative Loan)
that is not a MERS Mortgage Loan, the original Mortgage with evidence of
recording thereon, or if the original Mortgage has not yet been returned from
the recording office, a copy of such Mortgage certified by the applicable
Originator, title company, escrow agent or closing attorney to be a true copy
of the original of the Mortgage which has been sent for recording in the
appropriate jurisdiction in which the Mortgaged Property is located, and in
the case of the each MERS Mortgage Loan, the original Mortgage, noting the
presence of the MIN of the Mortgage Loans and either language indicating that
the Mortgage Loan is a MOM Loan if 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) with respect to each Mortgage Loan (other than a Cooperative Loan)
that is not a MERS Mortgage Loan, the Assignment of Mortgage in form and
substance acceptable for recording in the relevant jurisdiction, such
assignment being either (A) in blank, without recourse, or (B) endorsed to
"LaSalle Bank National Association, as Trustee of Xxxxxx Xxxxxxx Mortgage Loan
Trust 2006-9AR, Mortgage Pass-Through Certificates, without recourse";
(iv) with respect to each Mortgage Loan (other than a Cooperative Loan)
that is not a MERS Mortgage Loan, the originals of all intervening assignments
of the Mortgage, if any, with evidence of recording thereon, or if the
original intervening assignment has not yet been returned from the recording
office, a copy of such assignment certified by the applicable Originator,
title company, escrow agent or closing attorney to be a true copy of the
original of the assignment which has been sent for recording in the
appropriate jurisdiction in which the Mortgaged Property is located;
(v) with respect to each Mortgage Loan (other than a Cooperative Loan),
the originals of all assumption, modification, consolidation or extension
agreements, if any, with evidence of recording thereon;
(vi) if any, with respect to each Mortgage Loan (other than a
Cooperative Loan), the original policy of title insurance (or a true copy
thereof) with respect to any such Mortgage Loan, or, if such policy has not
yet been delivered by the insurer, the title commitment or title binder to
issue same;
(vii) if any, with respect to each Mortgage Loan (other than a
Cooperative Loan), the original power of attorney and guaranty agreement with
respect to such Mortgage Loan;
(viii) [Reserved];
(ix) with respect to each Mortgage Loan which constitutes a Cooperative
Loan:
53
(a) the original of any security agreement or similar document
executed in connection with the Cooperative Loan;
(b) the original Recognition Agreement and the original
Assignment of Recognition Agreement;
(c) UCC-1 financing statements with recording information
thereon from the appropriate governmental recording offices
if necessary to perfect the security interest of the
Cooperative Loan under the Uniform Commercial Code in the
jurisdiction in which the Cooperative Property is located,
accompanied by UCC-3 financing statements executed in blank
for recordation of the change in the secured party
thereunder;
(d) an Estoppel Letter and/or Consent;
(e) a search for (i) federal tax liens, mechanics' liens, lis
pendens, judgments of record or otherwise against (x) the
Cooperative Corporation and (y) the seller of the
Cooperative Unit, (ii) filings of financing statements and
(iii) the deed of the cooperative project into the
Cooperative Corporation;
(f) the guaranty of the Mortgage Note and Cooperative Loan, if
any;
(g) the original Proprietary Lease and the Assignment of
Proprietary Lease executed by the Mortgagor in blank or if
the Proprietary Lease has been assigned by the Mortgagor to
the Seller, then the Seller must execute an assignment of
the Assignment of Proprietary Lease in blank; and
(h) if any, the original or certified copy of the certificates
evidencing ownership of the Cooperative Shares issued by the
Cooperative Corporation and related assignment of such
certificates or an assignment of such Cooperative Shares, in
blank, executed by the Mortgagor with such signature
guaranteed;
(x) [Reserved]; and
(xi) any other document or instruments required to be delivered under
the related Custodial Agreement.
In addition, in connection with the assignment of any MERS Mortgage
Loan, it is understood that the related Originator will cause the MERS(R)
System to indicate that such Mortgage Loans have been assigned by the related
Originator 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 the information required by the MERS(R) System to identify the
series of Certificates issued in connection with such Mortgage Loans. It is
further understood that the related Originator will not, and the Master
Servicer hereby agrees that it will not, alter the information 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.
On or prior to the Closing Date, the Depositor shall cause to be
delivered to the Master Servicer, the Trustee and the Custodian an electronic
copy of the Mortgage Loan Schedule in a form acceptable to the Master
Servicer, the Depositor, the Trustee and the Custodian.
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(b) As soon as is practicable after the Closing Date, the Depositor
shall cause the Servicer of any Additional Collateral Mortgage Loan to deliver
to the applicable Custodian the Assignment and Notice of Transfer with respect
to each Additional Collateral Mortgage Loan as well as the assignments of any
rights with respect to each Additional Collateral Mortgage Loan under any
Limited Purpose Surety Bond.
(c) In instances where a title insurance policy is required to be
delivered to the applicable Custodian on behalf of the Trustee and is not so
delivered, the Depositor will provide a copy of such title insurance policy to
the applicable Custodian on behalf of the Trustee, as promptly as practicable
after the execution and delivery hereof, but in any case within 180 days of
the Closing Date.
(d) For Mortgage Loans (if any) that have been prepaid in full after the
Cut-off Date and prior to the Closing Date, the Depositor, in lieu of
delivering the above documents, herewith delivers such amount to the
Securities Administrator, and delivers to the Securities Administrator, the
Trustee, and the applicable Custodian, an Officer's Certificate which shall
include a statement to the effect that all amounts received in connection with
such prepayment that are required to be deposited in the Distribution Account
pursuant to Section 4.01 have been so deposited. All original documents that
are not delivered to the applicable Custodian on behalf of the Trustee shall
be held by the Master Servicer or the related Servicer in trust for the
benefit of the Trustee and the Certificateholders.
(e) Neither the Depositor nor the Trust will acquire or hold any
Mortgage Loan that would violate the representations made by the Seller set
forth in clauses (iv) through (vi) of Section 2.05(b) hereof.
Section 2.02. Acceptance of Trust Fund by Trustee; Review of
Documentation for Trust Fund.
(a) The Trustee, by execution and delivery hereof, acknowledges receipt
by it of notice from each of the Custodians that each holds the documents
identified in the Initial Custodial Certification in the form annexed hereto
as Exhibit L-1 (the "Initial Custodial Certification") pertaining to the
Mortgage Loans listed on the Mortgage Loan Schedule.
(b) Nothing in this Agreement shall be construed to constitute an
assumption by the Trust Fund, the Trustee, any Custodian or the
Certificateholders of any unsatisfied duty, claim or other liability on any
Mortgage Loan or to any Mortgagor.
(c) Each of the parties hereto acknowledges that (i) the Custodian has
delivered to the Depositor, the Master Servicer and the Trustee, the Initial
Custodial Certification, in the form annexed hereto as Exhibit L-1, stating
that it has performed the applicable review of the Mortgage Loans as required
herein and in the Custodial Agreements on the Closing Date and (ii)
thereafter, if applicable, the Custodian shall perform the applicable review
of the Mortgage Loans and deliver the further certifications (including but
not limited to the Final Custodial Certification) as provided herein and in
the applicable Custodial Agreements.
With respect to the MSMCI Mortgage Loans only, not later than 180 days
after the Closing Date, the Trustee shall enforce the related Custodian's
obligation, to the extent required
55
by the related Custodial Agreement, to deliver to the Depositor, the Master
Servicer and the Trustee a Final Custodial Certification in the form annexed
hereto as Exhibit L-2 (the "Final Custodial Certification"), with any
applicable exceptions noted thereon. To the extent that a Custodian must
deliver a Final Certification under the related Custodial Agreement, the
Trustee shall enforce that Custodian's obligation to make available, upon
request of any Certificateholder, a copy of any exceptions noted on the
related Initial Custodial Certification or the related Final Custodial
Certification.
(d) Upon execution of this Agreement, the Depositor hereby delivers to
the Trustee (with a copy to the Master Servicer) and the Trustee acknowledges
receipt of the Acknowledgements, together with the related Purchase and
Servicing Agreements.
(e) Neither the Trustee nor the Custodian shall make any representation
as to: (i) the validity, legality, sufficiency, enforceability or genuineness
of any of the documents contained in the Trustee Mortgage File of any of the
Mortgage Loans identified on the Mortgage Loan Schedule, or (ii) the
collectability, insurability, perfection, priority, effectiveness or
suitability of any such Mortgage Loan. Except as specifically required
hereunder, neither the Trustee nor the Custodian shall be responsible to
verify the validity, sufficiency or genuiness of any document in the Trustee
Mortgage File.
Section 2.03. Representations and Warranties of the Depositor.
(a) The Depositor hereby represents and warrants to the Trustee, for the
benefit of the Certificateholders, and to the Master Servicer and the
Securities Administrator as of the Closing Date or such other date as is
specified, that:
(i) the Depositor is a corporation duly organized, validly existing
and in good standing under the laws governing its creation and existence
and has full corporate power and authority to own its property, to carry
on its business as presently conducted, to enter into and perform its
obligations under this Agreement, and to create the trust pursuant
hereto;
(ii) the execution and delivery by the Depositor of this Agreement
have been duly authorized by all necessary corporate action on the part
of the Depositor; neither the execution and delivery of this Agreement,
nor the consummation of the transactions herein contemplated, nor
compliance with the provisions hereof, will conflict with or result in a
breach of, or constitute a default under, any of the provisions of any
law, governmental rule, regulation, judgment, decree or order binding on
the Depositor or its properties or the certificate of incorporation or
bylaws of the Depositor;
(iii) the execution, delivery and performance by the Depositor of
this Agreement and the consummation of the transactions contemplated
hereby do not require the consent or approval of, the giving of notice
to, the registration with, or the taking of any other action in respect
of, any state, federal or other governmental authority or agency, except
such as has been obtained, given, effected or taken prior to the date
hereof;
(iv) this Agreement has been duly executed and delivered by the
Depositor and, assuming due authorization, execution and delivery by the
Trustee, the Master Servicer and the Securities Administrator,
constitutes a valid and binding obligation of the Depositor enforceable
against it in accordance with its terms except as such enforceability may
be subject to (A) applicable bankruptcy and insolvency laws and other
similar laws affecting the enforcement of the rights of creditors
generally and (B) general principles of equity regardless of whether such
enforcement is considered in a proceeding in equity or at law;
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(v) there are no actions, suits or proceedings pending or, to the
knowledge of the Depositor, threatened or likely to be asserted against
or affecting the Depositor, before or by any court, administrative
agency, arbitrator or governmental body (A) with respect to any of the
transactions contemplated by this Agreement or (B) with respect to any
other matter which in the judgment of the Depositor will be determined
adversely to the Depositor and will if determined adversely to the
Depositor materially and adversely affect it or its business, assets,
operations or condition, financial or otherwise, or adversely affect its
ability to perform its obligations under this Agreement;
(vi) immediately prior to the transfer and assignment of the
Mortgage Loans to the Trustee, the Depositor was the sole owner of record
and holder of each Mortgage Loan, and the Depositor had good and
marketable title thereto, and had full right to transfer and sell each
Mortgage Loan to the Trustee free and clear, subject only to (1) liens of
current real property taxes and assessments not yet due and payable and,
if the related Mortgaged Property is a condominium unit, any lien for
common charges permitted by statute, (2) covenants, conditions and
restrictions, rights of way, easements and other matters of public record
as of the date of recording of such Mortgage acceptable to mortgage
lending institutions in the area in which the related Mortgaged Property
is located and specifically referred to in the lender's title insurance
policy or attorney's opinion of title and abstract of title delivered to
the originator of such Mortgage Loan, and (3) such other matters to which
like properties are commonly subject which do not, individually or in the
aggregate, materially interfere with the benefits of the security
intended to be provided by the Mortgage, of any encumbrance, equity,
participation interest, lien, pledge, charge, claim or security interest,
and had full right and authority, subject to no interest or participation
of, or agreement with, any other party, to sell and assign each Mortgage
Loan pursuant to this Agreement;
(vii) This Agreement creates a valid and continuing security
interest (as defined in the applicable Uniform Commercial Code (the
"UCC"), in the Mortgage Loans in favor of the Trustee, which security
interest is prior to all other liens, and is enforceable as such against
creditors of and purchasers from the Depositor;
(viii) The Mortgage Loans constitute "instruments" within the
meaning of the applicable UCC;
(ix) Other than the security interest granted to the Trustee
pursuant to this Agreement, the Depositor has not pledged, assigned,
sold, granted a security interest in, or otherwise conveyed any of the
Mortgage Loans. The Depositor has not authorized the filing of and is not
aware of any financing statement against the Depositor that includes a
description of the collateral covering the Mortgage Loans other than a
financing statement relating to the security interest granted to the
Trustee hereunder or that has been terminated. The Depositor is not aware
of any judgment or tax lien filings against the Depositor;
(x) None of the Mortgage Loans have any marks or notations
indicating that such Mortgage Loans have been pledged, assigned or
otherwise conveyed to any Person other than the Trustee; and
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(xi) The Depositor has received all consents and approvals required
by the terms of the Mortgage Loans to convey the Mortgage Loans hereunder
to the Trustee.
The foregoing representations made in this Section 2.03 shall survive
the termination of this Agreement and shall not be waived by any party hereto.
Section 2.04. Representations and Warranties of the Depositor and the
Seller as to the Mortgage Loans.
The Depositor hereby represents and warrants to the Trustee with respect
to the Mortgage Loans or each Mortgage Loan, as the case may be, as of the
date hereof or such other date set forth herein that as of the Closing Date:
(a) Immediately prior to the transfer and assignment contemplated
herein, the Depositor was the sole owner and holder of the Mortgage Loans. The
Mortgage Loans were not assigned or pledged by the Depositor and the Depositor
had good and marketable title thereto, and the Depositor had full right to
transfer and sell the Mortgage Loans to the Trustee, for the benefit of the
Certificateholders, free and clear of any encumbrance, participation interest,
lien, equity, pledge, claim or security interest and had full right and
authority subject to no interest or participation in, or agreement with any
other party to sell or otherwise transfer the Mortgage Loans.
(b) As of the Closing Date, the Depositor has transferred all right,
title and interest in the Mortgage Loans to the Trustee on behalf of the
Trust.
(c) As of the Closing Date, the Depositor has not transferred the
Mortgage Loans to the Trustee on behalf of the Trust with any intent to
hinder, delay or defraud an of its creditors.
It is understood and agreed that the representations and warranties set
forth in this Section 2.04 shall survive delivery of the respective Mortgage
Files to the Trustee or the Custodian and shall inure to the benefit of the
Trustee, notwithstanding any restrictive or qualified endorsement or
assignment.
Section 2.05. Representations and Warranties of the Seller; Discovery of
Breach; Repurchase or Substitution of Mortgage Loans.
(a) With respect to the MSMCI Mortgage Loans the Seller hereby makes the
representations and warranties contained in Section 3.01 of the MSMCI Purchase
Agreement to and for the benefit of the Depositor, the Trustee and the Trust
Fund.
The Seller hereby represents and warrants that no Mortgage Loan contains
a provision whereby the related mortgagor is permitted to convert the Mortgage
Rate from an adjustable rate to a fixed rate.
With respect to the FNBN Mortgage Loans the Seller hereby makes the
representations and warranties contained in Section 9.02 of the FNBN Purchase
Agreement (other than the representation contained in Section 9.02(b) of the
FNBN Purchase Agreement) to and for the
58
benefit of the Depositor, the Trustee and the Trust Fund. With respect to the
FNBN Mortgage Loans the Seller hereby represents and warrants to and for the
benefit of the Depositor, the Trustee and the Trust Fund that all payments due
on or prior to the Cut-off Date for each FNBN Mortgage Loan have been made as
of the Closing Date, such FNBN Mortgage Loan is not delinquent thirty (30)
days or more in payment and has not been dishonored; there are no material
defaults under the terms of such FNBN Mortgage Loan; the Seller has not
advanced funds, or induced, solicited or knowingly received any advance of
funds from a party other than the owner of the Mortgaged Property subject to
the Mortgage, directly or indirectly, for the payment of any amount required
by any FNBN Mortgage Loan; as to each FNBN Mortgage Loan, there has been no
more than one thirty (30) day delinquency during the immediately preceding
thirty-day period. The Seller agrees to comply with the provisions of this
Section 2.05 in respect of a breach of any of such representations and
warranties.
With respect to the Wachovia Serviced Mortgage Loans the Seller hereby
makes the representations and warranties contained in Section 3.02 of the
Wachovia Purchase Agreement (other than the representation contained in
Section 3.02(d) of the Wachovia Purchase Agreement) to and for the benefit of
the Depositor, the Trustee and the Trust Fund. With respect to the Wachovia
Serviced Mortgage Loans the Seller hereby represents and warrants to and for
the benefit of the Depositor, the Trustee and the Trust Fund that all payments
due on or prior to the Cut-off Date for each Wachovia Serviced Mortgage Loan
have been made as of the Closing Date, such Wachovia Serviced Mortgage Loan is
not delinquent thirty (30) days or more in payment and has not been
dishonored; there are no material defaults under the terms of such Wachovia
Serviced Mortgage Loan; the Seller has not advanced funds, or induced,
solicited or knowingly received any advance of funds from a party other than
the owner of the Mortgaged Property subject to the Mortgage, directly or
indirectly, for the payment of any amount required by any Wachovia Serviced
Mortgage Loan; as to each Wachovia Serviced Mortgage Loan, there has been no
more than one thirty (30) day delinquency during the immediately preceding
thirty-day period. The Seller agrees to comply with the provisions of this
Section 2.05 in respect of a breach of any of such representations and
warranties.
With respect to the Wachovia Originated Mortgage Loans the Seller hereby
makes the representations and warranties contained in Section 3.02 of the
Wachovia Purchase Agreement (other than the representation contained in
Section 3.02(d) of the Wachovia Purchase Agreement) to and for the benefit of
the Depositor, the Trustee and the Trust Fund. With respect to the Wachovia
Originated Mortgage Loans the Seller hereby represents and warrants to and for
the benefit of the Depositor, the Trustee and the Trust Fund that all payments
due on or prior to the Cut-off Date for each Wachovia Originated Mortgage Loan
have been made as of the Closing Date, such Wachovia Originated Mortgage Loan
is not delinquent thirty (30) days or more in payment and has not been
dishonored; there are no material defaults under the terms of such Wachovia
Originated Mortgage Loan; the Seller has not advanced funds, or induced,
solicited or knowingly received any advance of funds from a party other than
the owner of the Mortgaged Property subject to the Mortgage, directly or
indirectly, for the payment of any amount required by any Wachovia Originated
Mortgage Loan; as to each Wachovia Originated Mortgage Loan, there has been no
more than one thirty (30) day delinquency during the immediately preceding
thirty-day period. The Seller agrees to comply with the provisions of this
Section 2.05 in respect of a breach of any of such representations and
warranties.
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The Seller hereby represents and warrants to the Trustee with respect to
the Mortgage Loans as of the date hereof or such other date set forth herein
that as of the Closing Date:
(i) Each Mortgage Loan at origination complied in all material
respects with applicable predatory and abusive lending laws and
consummation of the transactions contemplated by this Agreement will not
involve the violation of any such laws.
(ii) All of the Mortgage Loans were originated in compliance with
all applicable laws, including, but not limited to, all applicable
anti-predatory and abusive lending laws.
(iii) None of the Mortgage Loans is covered by the Home Ownership
and Equity Protection Act of 1994 ("HOEPA").
(iv) None of the Mortgage Loans is a "high cost" loan as defined by
applicable predatory and abusive lending laws.
(v) No Mortgage Loan is a High Cost Loan or Covered Loan, as
applicable, and with respect to the foregoing, the terms "High Cost Loan"
and "Covered Loan" have the meaning assigned to them in the then current
version of Standard & Poor's LEVELS(R), which is now Version 5.6c
Glossary Revised, Appendix E which is attached hereto as Exhibit Q (the
"Glossary") where (x) a "High Cost Loan" is each loan identified in the
column "Category under applicable anti-predatory lending law" of the
table entitled "Standard & Poor's High Cost Loan Categorization" in the
Glossary as each such loan is defined in the applicable anti-predatory
lending law of the State or jurisdiction specified in such table and (y)
a "Covered Loan" is each loan identified in the column "Category under
applicable anti-predatory lending law" of the table entitled "Standard &
Poor's High Covered Loan Categorization" in the Glossary as each such
loan is defined in the applicable anti-predatory lending law of the State
or jurisdiction specified in such table.
(vi) No Mortgage Loan originated on or after October 1, 2002 through
March 6, 2003 is governed by the Georgia Fair Lending Act.
Upon discovery by the Depositor, the Seller or the related Originator or
receipt of written notice of any materially defective document in, or,
following the date of delivery to the Trustee of the Custodian's
certifications as required under the related Custodial Agreements, that a
document is missing from, a Trustee Mortgage File, or discovery by the
Trustee, the Depositor, the Seller or the related Originator of the breach by
such Originator or Seller of any representation or warranty under the related
Purchase and Servicing Agreement, as modified by the Acknowledgement, in the
case of the Originator, or under this Agreement, in the case of the Seller, in
respect of any Mortgage Loan which materially adversely affects the value of
that Mortgage Loan or the interest therein of the Certificateholders (a
"Defective Mortgage Loan") (each of the Depositor, the Seller and the related
Originator hereby agreeing to give written notice thereof to the Trustee and
the other of such parties), the Trustee, or its designee, shall promptly
notify the Depositor and the Seller or the related Originator, as applicable,
in writing of such nonconforming or missing document or breach and request
that the Seller or related
60
Originator deliver such missing document or cure or cause the cure of such
defect or breach within a period of time specified in the related Purchase and
Servicing Agreement, and if the Seller or related Originator, as applicable,
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 related Originator under the related Purchase and Servicing
Agreement, as modified by the Acknowledgement, or the Seller under this
Agreement, as applicable, and cause the related Originator or the Seller, as
the case may be, to repurchase that Mortgage Loan from the Trust Fund at the
Purchase Price on or prior to the Determination Date following the expiration
of such specified period (subject to Section 2.05(c) below); provided,
however, that, in connection with any such breach that could not reasonably
have been cured within such specified period (unless permitted a greater
period of time to cure under the related Purchase and Servicing Agreement),
subject to Section 2.05(c) below, if the related Originator or the Seller, as
applicable, shall have commenced to cure such breach within such specified
period, the related Originator or the Seller shall be permitted to proceed
thereafter diligently and expeditiously to cure the same within such
additional time as is reasonably necessary to cure such breach. To the extent
that the amount by which the Purchase Price (as defined in this Agreement)
exceeds the repurchase price payable by the related Originator under the
related Purchase and Servicing Agreement, including any costs and damages that
are incurred by the Trust Fund as a result of any violation of any applicable
federal, state, or local predatory or abusive lending law arising from or in
connection with the origination of any Mortgage Loan repurchased by the
related Originator or the Seller, the payment of such excess shall be borne by
the Seller. With respect to a breach of a representation or warranty of a
Hemisphere Serviced Mortgage Loan by the related Originator under the related
Purchase and Servicing Agreement, if that Originator fails to cure the breach
or repurchase the affected Mortgage Loan within the time period required by
that Purchase and Servicing Agreement, the Seller hereby agrees to honor that
Originator's cure obligations. The Purchase Price for the repurchased Mortgage
Loan shall be deposited in the related Distribution Account, and the Trustee,
or its designee, upon receipt of written certification from the Securities
Administrator of such deposit, shall release or cause the Custodian to release
to the related Originator or the Seller, as applicable, the related Trustee
Mortgage File and shall execute and deliver such instruments of transfer or
assignment, in each case without recourse, representation or warranties, as
either party shall furnish to it and as shall be necessary to vest in such
party any Mortgage Loan released pursuant hereto and the Trustee, or its
designee, shall have no further responsibility with regard to such Trustee
Mortgage File (it being understood that the Trustee shall have no
responsibility for determining the sufficiency of such assignment for its
intended purpose). If pursuant to the foregoing provisions the related
Originator or the Seller repurchases a Mortgage Loan that is a MERS Mortgage
Loan, the related Servicer shall cause MERS to designate on the MERS(R) System
the related Originator or the Seller, as applicable, as the beneficial holder
of such Mortgage Loan.
In lieu of repurchasing any such Mortgage Loan as provided above, either
party may cause such Mortgage Loan to be removed from the Trust Fund (in which
case it shall become a Deleted Mortgage Loan) and substitute one or more
Replacement Mortgage Loans in the manner and subject to the limitations set
forth in Section 2.05(b) below. It is understood and agreed that the
obligations of the Originators and the Seller to cure or to repurchase (or to
substitute for) any related 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
61
sole remedy against the such party respecting such omission, defect or breach
available to the Trustee on behalf of the Certificateholders.
(b) Any substitution of Replacement Mortgage Loans for Deleted Mortgage
Loans made pursuant to Section 2.05(a) above must be effected prior to the
last Business Day that is within two years after the Closing Date. As to any
Deleted Mortgage Loan for which the related Originator or the Seller
substitutes a Replacement Mortgage Loan or Loans, such substitution shall be
effected by delivering to the Custodian, on behalf of the Trustee, for such
Replacement Mortgage Loan or Loans, the Mortgage Note, the Mortgage, any
related assignment thereof and the Acknowledgement to the Trustee, and such
other documents and agreements, with all necessary endorsements thereon,
together with an Officers' Certificate stating that each such Replacement
Mortgage Loan satisfies the definition thereof and specifying the Substitution
Adjustment Amount (as described below), if any, in connection with such
substitution. Monthly Payments due with respect to Replacement Mortgage Loans
in the month of substitution shall not be included as part of the Trust Fund
and shall be retained by the related Originator or the Seller, as applicable.
For the month of substitution, distributions to the Certificateholders shall
reflect the collections and recoveries in respect of such Deleted Mortgage in
the Due Period preceding the month of substitution and the related Originator
or the Seller, as applicable, shall thereafter be entitled to retain all
amounts subsequently received in respect of such Deleted Mortgage Loan. Upon
such substitution, such Replacement Mortgage Loan shall constitute part of the
Trust Fund and shall be subject in all respects to the terms of this Agreement
and the related Purchase and Servicing Agreement, as modified by the related
Acknowledgement, including all representations and warranties thereof included
in such Purchase and Servicing Agreement, as modified by the Acknowledgement,
in each case as of the date of substitution.
For any month in which an Originator or the Seller substitutes one or
more Replacement Mortgage Loans for one or more Deleted Mortgage Loans, the
related Servicer shall determine the excess (each, a "Substitution Adjustment
Amount"), if any, by which the aggregate Purchase Price of all such Deleted
Mortgage Loans exceeds the aggregate Stated Principal Balance of the
Replacement Mortgage Loans replacing such Deleted Mortgage Loans, together
with one month's interest on such excess amount at the applicable Net Mortgage
Rate. On the date of such substitution, the related Originator or Seller, as
applicable, shall deliver or cause to be delivered to the related Servicer for
deposit in the related Custodial Account an amount equal to the related
Substitution Adjustment Amount, if any, and the Custodian, on behalf of the
Trustee, upon receipt of the related Replacement Mortgage Loan or Loans and
Request for Release and certification by such Servicer of such deposit, shall
release to the related Originator or the Seller, as applicable, the related
Trustee Mortgage File or Files and the Trustee or the Custodian, as applicable,
shall execute and deliver such instruments of transfer or assignment, in each
case without recourse, as the related Originator or Seller shall deliver to it
and as shall be necessary to vest therein any Deleted Mortgage Loan released
pursuant hereto.
In addition, the related Originator or the Seller, as applicable, shall
obtain at its own expense and deliver to the Trustee and the Securities
Administrator an Opinion of Counsel to the effect that such substitution
(either specifically or as a class of transactions) shall not cause an Adverse
REMIC Event. If such Opinion of Counsel cannot be delivered, then such
substitution may only be effected at such time as the required Opinion of
Counsel can be given.
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(c) Upon discovery by the related Originator, the Seller, the Master
Servicer, the Depositor or the Trustee that any Mortgage Loan does not
constitute a "qualified mortgage" within the meaning of Section 860G(a)(3) of
the Code, the party discovering such fact shall within two Business Days give
written notice thereof to the other parties. In connection therewith, the
applicable party shall repurchase or, subject to the limitations set forth in
Section 2.05(b), substitute one or more Replacement Mortgage Loans for the
affected Mortgage Loan within 90 days of the earlier of discovery or receipt
of such notice with respect to such affected Mortgage Loan. Any such
repurchase or substitution shall be made in the same manner as set forth in
Section 2.05(a) above and/or in accordance with this Section 2.05(c). The
Trustee shall re-convey to the related Originator or the Seller, as
applicable, the Mortgage Loan to be released pursuant hereto in the same
manner, and on the same terms and conditions, as it would a Mortgage Loan
repurchased for breach of a representation or warranty.
Section 2.06. Grant Clause.
(a) It is intended that the conveyance of the Depositor's right, title
and interest in and to property constituting the Trust Fund pursuant to this
Agreement shall constitute, and shall be construed as, a sale of such property
and not a grant of a security interest to secure a loan. However, if such
conveyance is deemed to be in respect of a loan, it is intended that: (1) the
rights and obligations of the parties shall be established pursuant to the
terms of this Agreement; (2) the Depositor hereby grants to the Trustee for
the benefit of the Holders of the Certificates a first priority security
interest in all of the Depositor's right, title and interest in, to and under,
whether now owned or hereafter acquired, the Trust Fund and all proceeds of
any and all property constituting the Trust Fund to secure payment of the
Certificates; and (3) this Agreement shall constitute a security agreement
under applicable law. If such conveyance is deemed to be in respect of a loan
and the trust created by this Agreement terminates prior to the satisfaction
of the claims of any Person holding any Certificate, the security interest
created hereby shall continue in full force and effect and the Trustee shall
be deemed to be the collateral agent for the benefit of such Person, and all
proceeds shall be distributed as herein provided.
(b) The Depositor shall, to the extent consistent with this Agreement,
take such reasonable actions as may be necessary to ensure that, if this
Agreement were deemed to create a security interest in the Mortgage Loans and
the other property described above, 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. The
Depositor will, at its own expense, make all initial filings on or about the
Closing Date and shall forward a copy of such filing or filings to the
Trustee. Without limiting the generality of the foregoing, the Depositor shall
prepare and forward for filing, or shall cause to be forwarded for filing, at
the expense of the Depositor, all filings necessary to maintain the
effectiveness of any original filings necessary under the relevant UCC to
perfect the Trustee's security interest in or lien on the Mortgage Loans,
including without limitation (x) continuation statements, and (y) such other
statements as may be occasioned by (1) any change of name of an Originator,
the Depositor or the Trustee, (2) any change of location of the place of
business or the chief executive office of the Seller or the Depositor, (3) any
transfer of any interest of an Originator or the Depositor in any Mortgage
Loan or (4) any change under the relevant UCC or other applicable laws.
Neither the Originators nor the Depositor shall organize under the law of any
jurisdiction other than the State under which each is organized as of the
Closing Date (whether changing its jurisdiction of
63
organization or organizing under an additional jurisdiction) without giving 30
days prior written notice of such action to its immediate and intermediate
transferee, including the Trustee. Before effecting such change, any
Originator or the Depositor proposing to change its jurisdiction of
organization shall prepare and file in the appropriate filing office any
financing statements or other statements necessary to continue the perfection
of the interests of its immediate and intermediate transferees, including the
Trustee, in the Mortgage Loans. In connection with the transactions
contemplated by this Agreement, each of the Originators and the Depositor
authorizes its immediate or intermediate transferee (but not the Trustee) to
file in any filing office any initial financing statements, any amendments to
financing statements, any continuation statements, or any other statements or
filings described in this paragraph (b).
Section 2.07. Depositor's Option to Purchase Breached Mortgage Loans.
(a) Subject to the terms specified in this Agreement, the Depositor has
the option, but is not obligated, to purchase from the Trust Fund any Breached
Mortgage Loan at the Repurchase Price; provided that the entity from which the
Seller purchased the Mortgage Loan has both (a) agreed to purchase the
Mortgage Loan from the Depositor and (b) has represented to the Seller that it
has the ability to purchase such Mortgage Loan from the Depositor, as soon as
is practicable thereafter at the Repurchase Price.
Section 2.08. Release of Mortgage Documents for Servicing
(a) From time to time and as appropriate for the foreclosure or servicing
of any of the Mortgage Loans, the Custodian shall, upon receipt in writing,
facsimile or electronic transmission from the Master Servicer or a Servicer of
a Request for Release release to the Master Servicer or such Servicer the
Mortgage Documents set forth in such Request for Release. All Mortgage
Documents released by the Custodian to the Master Servicer or a Servicer
pursuant to this Section 2.08 shall be held by the Master Servicer or such
Servicer in trust for the benefit of the Trust pursuant to the applicable
Purchase and Servicing Agreement. Upon the repurchase of any Mortgage Loan or
upon the payment in full of any Mortgage Loan, and upon receipt by the
Custodian of (i) the Request for Release (which Request for Release shall
include a statement to the effect that all amounts payable to the Trust in
connection with a repurchase have been deposited in the related Custodial
Account or the Collection Account or (ii) direction of the Depositor or the
Trustee, as applicable, the Custodian shall promptly release the related
Mortgage Documents in accordance with such Request for Release or direction.
ARTICLE III
THE CERTIFICATES
Section 3.01. The Certificates.
(a) The Certificates shall be issuable in registered form only and shall
be securities governed by Article 8 of the New York Uniform Commercial Code.
The Book-Entry Certificates will be evidenced by one or more certificates,
beneficial ownership of which will be held in the dollar denominations in
Certificate Balance, or Notional Amount, as applicable, or in the Percentage
Interests, specified herein. Each Class of Certificates will be issued in the
minimum denominations and integral multiples thereof of the initial
Certificate Balance (or Notional Amount) specified in the Preliminary
Statement hereto.
(b) The Certificates shall be executed by manual or facsimile signature
on behalf of the Trustee by an authorized officer of the Trustee or of the
Securities Administrator on the Trustee's behalf. Each Certificate shall, on
original issue, be authenticated by the Authenticating Agent upon the order of
the Depositor upon receipt by the Trustee of the Trustee Mortgage Files
described in Section 2.01. No Certificate shall be entitled to any benefit
under this Agreement, or be valid for any purpose, unless there appears on
such Certificate a certificate of authentication substantially in the form
provided for herein, executed by an authorized officer of the Authenticating
Agent, by manual signature, and such certification upon any Certificate shall
be conclusive evidence, and the only evidence, that such Certificate has been
duly authenticated and delivered hereunder. All Certificates shall be dated
the date of their authentication. At any time and from time to time after the
execution and delivery of this Agreement, the Depositor may deliver
Certificates executed by or on behalf of the Trustee to the Authenticating
Agent for
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authentication and the Authenticating Agent shall authenticate and deliver
such Certificates as in this Agreement provided and not otherwise.
(c) The Class OC, Class P and Class A-R Certificates offered and sold in
reliance on the exemption from registration under Rule 144A under the Act
shall be issued initially in definitive, fully registered form without
interest coupons with the applicable legends set forth in Exhibit A added to
the forms of such Certificates (each, a "Restricted Global Security").
Section 3.02. Registration.
The Securities Administrator is hereby appointed, and the Securities
Administrator hereby accepts its appointment as, initial Certificate Registrar
in respect of the Certificates and shall maintain books for the registration
and for the transfer of Certificates (the "Certificate Register"). The Trustee
may appoint a bank or trust company to act as successor Certificate Registrar.
A registration book shall be maintained for the Certificates collectively. The
Certificate Registrar may resign or be discharged or removed and a new
successor may be appointed in accordance with the procedures and requirements
set forth in Sections 6.06 and 6.07 hereof with respect to the resignation,
discharge or removal of the Securities Administrator and the appointment of a
successor Securities Administrator. The Certificate Registrar may appoint, by
a written instrument delivered to the Holders and the Master Servicer, any
bank or trust company to act as co-registrar under such conditions as the
Certificate Registrar may prescribe; provided, however, that the Certificate
Registrar shall not be relieved of any of its duties or responsibilities
hereunder by reason of such appointment.
Section 3.03. Transfer and Exchange of Certificates.
(a) A Certificate (other than Book-Entry Certificates which shall be
subject to Section 3.09 hereof) may be transferred by the Holder thereof only
upon presentation and surrender of such Certificate at the office of the
Certificate Registrar duly endorsed or accompanied by an assignment duly
executed by such Holder or his duly authorized attorney in such form as shall
be satisfactory to the Certificate Registrar. Upon the transfer of any
Certificate in accordance with the preceding sentence, the Securities
Administrator on behalf of the Trustee shall execute, and the Authenticating
Agent shall authenticate and deliver to the transferee, one or more new
Certificates of the same Class and evidencing, in the aggregate, the same
aggregate Certificate Balance (or Notional Amount) as the Certificate being
transferred. No service charge shall be made to a Certificateholder for any
registration of transfer of Certificates, but the Certificate Registrar may
require payment of a sum sufficient to cover any tax or governmental charge
that may be imposed in connection with any registration of transfer of
Certificates.
(b) A Certificate may be exchanged by the Holder thereof for any number
of new Certificates of the same Class, in authorized denominations,
representing in the aggregate the same Certificate Balance (or Notional
Amount) as the Certificate surrendered, upon surrender of the Certificate to
be exchanged at the office of the Certificate Registrar duly endorsed or
accompanied by a written instrument of transfer duly executed by such Holder
or his duly authorized attorney in such form as is satisfactory to the
Certificate Registrar. Certificates delivered upon any such exchange will
evidence the same obligations, and will be entitled to the
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same rights and privileges, as the Certificates surrendered. No service charge
shall be made to a Certificateholder for any exchange of Certificates, but the
Certificate Registrar may require payment of a sum sufficient to cover any tax
or governmental charge that may be imposed in connection with any exchange of
Certificates. Whenever any Certificates are so surrendered for exchange, the
Securities Administrator on behalf of the Trustee shall execute, and the
Authenticating Agent shall authenticate, date and deliver the Certificates
which the Certificateholder making the exchange is entitled to receive.
(c) By acceptance of a Restricted Certificate, whether upon original
issuance or subsequent transfer, each Holder of such a Certificate
acknowledges the restrictions on the transfer of such Certificate set forth
thereon and agrees that it will transfer such a Certificate only as provided
herein.
The following restrictions shall apply with respect to the transfer and
registration of transfer of a Restricted Certificate to a transferee that
takes delivery in the form of a Definitive Certificate:
(i) The Certificate Registrar shall register the transfer of a
Restricted Certificate if the requested transfer is (x) to the Depositor
or an affiliate (as defined in Rule 405 under the 0000 Xxx) of the
Depositor or (y) being made to a "qualified institutional buyer" (a
"QIB") as defined in Rule 144A under the Securities Act of 1933, as
amended (the "Act") by a transferor that has provided the Certificate
Registrar with a certificate in the form of Exhibit H hereto; and
(ii) The Certificate Registrar shall register the transfer of a
Restricted Certificate if the requested transfer is being made to an
"accredited investor" under Rule 501(a)(1), (2), (3) or (7) under the
Act, or to any Person all of the equity owners in which are such
accredited investors, by a transferor who furnishes to the Certificate
Registrar a letter of the transferee substantially in the form of Exhibit
I hereto.
(d) No transfer of an ERISA-Restricted Certificate in the form of a
Definitive Certificate shall be made to any Person or shall be effective
unless the Certificate Registrar, on behalf of the Trustee, has received (A) a
certificate substantially in the form of Exhibit J hereto (or Exhibit B, in
the case of a Residual Certificate) from such transferee or (B) an Opinion of
Counsel satisfactory to the Certificate Registrar and the Securities
Administrator to the effect that the purchase and holding of such a
Certificate will not constitute or result in any nonexempt prohibited
transactions under Title I of ERISA or Section 4975 of the Code or any
Federal, state or local law ("Similar Law") materially similar to the
foregoing provisions of ERISA or the Code and will not subject the Certificate
Registrar, the Trustee, the Master Servicer, the Depositor or the Securities
Administrator to any obligation in addition to those undertaken in the
Agreement; provided, however, that the Certificate Registrar will not require
such certificate or opinion in the event that, as a result of a change of law
or otherwise, counsel satisfactory to the Certificate Registrar has rendered
an opinion to the effect that the purchase and holding of an ERISA-Restricted
Certificate by a Plan or a Person that is purchasing or holding such a
Certificate with the assets of a Plan will not constitute or result in a
prohibited transaction under Title I of ERISA or Section 4975 of the Code and
will not subject the Certificate Registrar, the Trustee, the Master Servicer,
the Depositor or the Securities Administrator to any obligation in
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addition to those undertaken in this Agreement. Each Transferee of an
ERISA-Restricted Certificate that is a Book-Entry Certificate shall be deemed
to have made the appropriate representation set forth in paragraph 2 and the
representation set forth in paragraph 3 of Exhibit J. The preparation and
delivery of the certificate and opinions referred to above shall not be an
expense of the Trust Fund, the Certificate Registrar, the Trustee, the Master
Servicer, the Depositor or the Securities Administrator.
During the period the Supplemental Interest Trust is in effect, no
transfer of a Certificate shall be made unless the Securities Administrator
shall have received either a representation from the transferee of such
Certificate acceptable to and in form and substance satisfactory to the
Securities Administrator to the effect that such transferee is not a Plan, or
(ii) a representation that the purchase and holding of the Certificate satisfy
the requirements for exemptive relief under an Investor Based Exemption, or in
the case of a Plan subject to Similar Law, will not constitute a non-exempt
violation of such Similar Law. In the event such a representation letter is
not delivered, one of the foregoing representations, as appropriate, shall be
deemed to have been made by the transferee's (including an initial acquirer's)
acceptance of the Certificate. In the event that such representation is
violated, such transfer or acquisition shall be void and of no effect.
Notwithstanding the foregoing, no opinion or certificate shall be
required for the initial issuance of the ERISA-Restricted Certificates to the
Underwriter. The Certificate Registrar shall have no obligation to monitor
transfers of Book-Entry Certificates that are ERISA-Restricted Certificates
and shall have no liability for transfers of such Certificates in violation of
the transfer restrictions. The Certificate Registrar shall be under no
liability to any Person for any registration of transfer of any
ERISA-Restricted Certificate that is in fact not permitted by this Section
3.03(d) and neither the Securities Administrator nor the Paying Agent shall
have any liability for making any payments due on such Certificate to the
Holder thereof or taking any other action with respect to such Holder under
the provisions of this Agreement so long as the transfer was registered by the
Certificate Registrar in accordance with the foregoing requirements. The
Securities Administrator, on behalf of the Trustee, shall be entitled, but not
obligated, to recover from any Holder of any ERISA-Restricted Certificate that
was in fact a Plan or a Person acting on behalf of a Plan any payments made on
such ERISA-Restricted Certificate at and after such time. Any such payments so
recovered by the Securities Administrator, on behalf of the Trustee, shall be
paid and delivered by the Securities Administrator, on behalf of the Trustee,
to the last preceding Holder of such Certificate that is not such a Plan or
Person acting on behalf of a Plan.
(e) As a condition of the registration of transfer or exchange of any
Certificate, the Certificate Registrar may require the certified taxpayer
identification number of the owner of the Certificate and the payment of a sum
sufficient to cover any tax or other governmental charge imposed in connection
therewith; provided, however, that the Certificate Registrar shall have no
obligation to require such payment or to determine whether or not any such tax
or charge may be applicable. No service charge shall be made to the
Certificateholder for any registration, transfer or exchange of a Certificate.
(f) Notwithstanding anything to the contrary contained herein, no
Residual Certificate may be owned, pledged or transferred, directly or
indirectly, by or to (i) a
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Disqualified Organization or (ii) an individual, corporation or partnership or
other person unless such person (A) is not a Non-U.S. Person or (B) is a
Non-U.S. Person that holds a Residual Certificate in connection with the
conduct of a trade or business within the United States and has furnished the
transferor and the Certificate Registrar with an effective Internal Revenue
Service Form W-8ECI or successor form at the time and in the manner required
by the Code (any such person who is not covered by clause (A) or (B) above is
referred to herein as a "Non-permitted Foreign Holder").
Prior to and as a condition of the registration of any transfer, sale or
other disposition of a Residual Certificate, the proposed transferee shall
deliver to the Certificate Registrar an affidavit in substantially the form
attached hereto as Exhibit B representing and warranting, among other things,
that such transferee is neither a Disqualified Organization, an agent or
nominee acting on behalf of a Disqualified Organization, nor a Non-permitted
Foreign Holder (any such transferee, a "Permitted Transferee"), and the
proposed transferor shall deliver to the Trustee and the Certificate Registrar
an affidavit in substantially the form attached hereto as Exhibit C. In
addition, the Trustee or the Certificate Registrar may (but shall have no
obligation to) require, prior to and as a condition of any such transfer, the
delivery by the proposed transferee of an Opinion of Counsel, addressed to the
Trustee and the Certificate Registrar, that such proposed transferee or, if
the proposed transferee is an agent or nominee, the proposed beneficial owner,
is not a Disqualified Organization, agent or nominee thereof, or a
Non-permitted Foreign Holder. Notwithstanding the registration in the
Certificate Register of any transfer, sale, or other disposition of a Residual
Certificate to a Disqualified Organization, an agent or nominee thereof, or
Non-permitted Foreign Holder, such registration shall be deemed to be of no
legal force or effect whatsoever and such Disqualified Organization, agent or
nominee thereof, or Non-permitted Foreign Holder shall not be deemed to be a
Certificateholder for any purpose hereunder, including, but not limited to,
the receipt of distributions on such Residual Certificate. The Depositor and
the Certificate Registrar shall be under no liability to any Person for any
registration or transfer of a Residual Certificate to a Disqualified
Organization, agent or nominee thereof or Non-permitted Foreign Holder or for
the Paying Agent making any payments due on such Residual Certificate to the
Holder thereof or for taking any other action with respect to such Holder
under the provisions of the Agreement, so long as the transfer was effected in
accordance with this Section 3.03(f), unless the Certificate Registrar shall
have actual knowledge at the time of such transfer or the time of such payment
or other action that the transferee is a Disqualified Organization, or an
agent or nominee thereof, or Non-permitted Foreign Holder. The Certificate
Registrar shall be entitled to recover from any Holder of a Residual
Certificate that was a Disqualified Organization, agent or nominee thereof, or
Non-permitted Foreign Holder at the time it became a Holder or any subsequent
time it became a Disqualified Organization, agent or nominee thereof, or
Non-permitted Foreign Holder, all payments made on such Residual Certificate
at and after either such times (and all costs and expenses, including but not
limited to attorneys' fees, incurred in connection therewith). Any payment
(not including any such costs and expenses) so recovered by the Certificate
Registrar shall be paid and delivered to the last preceding Holder of such
Residual Certificate.
If any purported transferee shall become a registered Holder of a
Residual Certificate in violation of the provisions of this Section 3.03(f),
then upon receipt of written notice to the Trustee or the Certificate
Registrar that the registration of transfer of such Residual Certificate was
not in fact permitted by this Section 3.03(f), the last preceding Permitted
Transferee shall be
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restored to all rights as Holder thereof retroactive to the date of such
registration of transfer of such Residual Certificate. The Depositor, the
Certificate Registrar and the Trustee shall be under no liability to any
Person for any registration of transfer of a Residual Certificate that is in
fact not permitted by this Section 3.03(f), or for the Paying Agent making any
payment due on such Certificate to the registered Holder thereof or for taking
any other action with respect to such Holder under the provisions of this
Agreement so long as the transfer was registered upon receipt of the affidavit
described in the preceding paragraph of this Section 3.03(f).
(g) Each Holder or Certificate Owner of a Restricted Certificate,
ERISA-Restricted Certificate or Residual Certificate, or an interest therein,
by such Holder's or Owner's acceptance thereof, shall be deemed for all
purposes to have consented to the provisions of this section.
Section 3.04. Cancellation of Certificates.
Any Certificate surrendered for registration of transfer or exchange
shall be cancelled and retained in accordance with normal retention policies
with respect to cancelled certificates maintained by the Certificate
Registrar.
Section 3.05. Replacement of Certificates.
If (i) any Certificate is mutilated and is surrendered to the Trustee or
the Certificate Registrar or (ii) the Certificate Registrar receives evidence
to its satisfaction of the destruction, loss or theft of any Certificate, and
there is delivered to the Trustee and the Certificate Registrar such security
or indemnity as may be required by them to save each of them harmless, then,
in the absence of notice to the Depositor, the Trustee or the Certificate
Registrar that such destroyed, lost or stolen Certificate has been acquired by
a protected purchaser, the Securities Administrator on behalf of the Trustee
shall execute and the Authenticating Agent shall authenticate and deliver, in
exchange for or in lieu of any such mutilated, destroyed, lost or stolen
Certificate, a new Certificate of like tenor and Certificate Balance. Upon the
issuance of any new Certificate under this Section 3.05, the Trustee, the
Depositor or the Certificate Registrar may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed
in relation thereto and any other expenses (including the fees and expenses of
the Trustee, the Depositor or the Certificate Registrar) connected therewith.
Any replacement Certificate issued pursuant to this Section 3.05 shall
constitute complete and indefeasible evidence of ownership in the applicable
Trust Fund, as if originally issued, whether or not the lost, stolen or
destroyed Certificate shall be found at any time.
If after the delivery of such new Certificate, a protected purchaser of
the original Certificate in lieu of which such new Certificate was issued
presents for payment such original Certificate, the Depositor, the Certificate
Registrar and the Trustee or any agent shall be entitled to recover such new
Certificate from the Person to whom it was delivered or any Person taking
therefrom, except a protected purchaser, and shall be entitled to recover upon
the security or indemnity provided therefor to the extent of any loss, damage,
cost or expenses incurred by the Depositor, the Certificate Registrar, the
Trustee or any agent in connection therewith.
Section 3.06. Persons Deemed Owners.
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Subject to the provisions of Section 3.09 with respect to Book-Entry
Certificates, the Depositor, the Master Servicer, the Securities
Administrator, the Trustee, the Certificate Registrar, the Paying Agent and
any agent of any of them shall treat the Person in whose name any Certificate
is registered upon the books of the Certificate Registrar as the owner of such
Certificate for the purpose of receiving distributions pursuant to Sections
5.01 and 5.02 and for all other purposes whatsoever, and neither the
Depositor, the Master Servicer, the Securities Administrator, the Trustee, the
Certificate Registrar, the Paying Agent nor any agent of any of them shall be
affected by notice to the contrary.
Section 3.07. Temporary Certificates.
(a) Pending the preparation of definitive Certificates, upon the order
of the Depositor, the Securities Administrator on behalf of the Trustee shall
execute and the Authenticating Agent shall authenticate and deliver temporary
Certificates that are printed, lithographed, typewritten, mimeographed or
otherwise produced, in any authorized denomination, substantially of the tenor
of the definitive Certificates in lieu of which they are issued and with such
variations as the authorized officers executing such Certificates may
determine, as evidenced by their execution of such Certificates.
(b) If temporary Certificates are issued, the Depositor will cause
definitive Certificates to be prepared without unreasonable delay. After the
preparation of definitive Certificates, the temporary Certificates shall be
exchangeable for definitive Certificates upon surrender of the temporary
Certificates at the office or agency of the Certificate Registrar without
charge to the Holder. Upon surrender for cancellation of any one or more
temporary Certificates, the Securities Administrator on behalf of the Trustee
shall execute and the Authenticating Agent shall authenticate and deliver in
exchange therefor a like aggregate Certificate Balance of definitive
Certificates of the same Class in the authorized denominations. Until so
exchanged, the temporary Certificates shall in all respects be entitled to the
same benefits under this Agreement as definitive Certificates of the same
Class.
Section 3.08. Appointment of Paying Agent.
The Securities Administrator is hereby appointed as the initial Paying
Agent. The Trustee may appoint a successor Paying Agent (which may be the
Trustee) for the purpose of making distributions to the Certificateholders
hereunder. The Trustee shall cause any Paying Agent, other than the Securities
Administrator, to execute and deliver to the Trustee an instrument in which
such Paying Agent shall agree with the Trustee that such Paying Agent will
hold all sums held by it for the payment to the Certificateholders in an
Eligible Account (which shall be the Distribution Account) in trust for the
benefit of the Certificateholders entitled thereto until such sums shall be
paid to the Certificateholders. All funds remitted by the Securities
Administrator to any such Paying Agent for the purpose of making distributions
shall be paid to the Certificateholders on each Distribution Date and any
amounts not so paid shall be returned on such Distribution Date to the
Securities Administrator. If the Paying Agent is not the Trustee or the
Securities Administrator, the Securities Administrator shall cause to be
remitted to the Paying Agent on or before the Business Day prior to each
Distribution Date, by wire transfer in immediately available funds, the funds
to be distributed on such Distribution Date. Any Paying
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Agent shall be either a bank or trust company or otherwise authorized under
law to exercise corporate trust powers.
Section 3.09. Book-Entry Certificates.
(a) Each Class of Book-Entry Certificates, upon original issuance, shall
be issued in the form of one or more typewritten Certificates representing the
Book-Entry Certificates. The Book-Entry Certificates shall initially be
registered on the Certificate Register in the name of the nominee of the
Clearing Agency, and no Certificate Owner will receive a definitive
certificate representing such Certificate Owner's interest in the Book-Entry
Certificates, except as provided in Section 3.09(c). Unless Definitive
Certificates have been issued to Certificate Owners of Book-Entry Certificates
pursuant to Section 3.09(c):
(i) the provisions of this Section 3.09 shall be in full force and
effect;
(ii) the Certificate Registrar, the Paying Agent and the Trustee
shall deal with the Clearing Agency for all purposes (including the
making of distributions on the Book-Entry Certificates) as the authorized
representatives of the Certificate Owners and the Clearing Agency and
shall be responsible for crediting the amount of such distributions to
the accounts of such Persons entitled thereto, in accordance with the
Clearing Agency's normal procedures;
(iii) to the extent that the provisions of this Section 3.09
conflict with any other provisions of this Agreement, the provisions of
this Section 3.09 shall control; and
(iv) the rights of Certificate Owners shall be exercised only
through the Clearing Agency and the Clearing Agency Participants and
shall be limited to those established by law and agreements between such
Certificate Owners and the Clearing Agency and/or the Clearing Agency
Participants. Unless and until Definitive Certificates are issued
pursuant to Section 3.09(c), the initial Clearing Agency will make
book-entry transfers among the Clearing Agency Participants and receive
and transmit distributions of principal of and interest on the Book-Entry
Certificates to such Clearing Agency Participants.
(b) Whenever notice or other communication to the Certificateholders is
required under this Agreement, unless and until Definitive Certificates shall
have been issued to Certificate Owners pursuant to Section 3.09(c), the
Securities Administrator shall give all such notices and communications
specified herein to be given to Holders of the Book-Entry Certificates to the
Clearing Agency.
(c) If (i) (A) the Clearing Agency or the Depositor advises the
Certificate Registrar in writing that the Clearing Agency is no longer willing
or able to discharge properly its responsibilities with respect to the
Book-Entry Certificates, and (B) the Depositor is unable to locate a qualified
successor satisfactory to the Depositor and the Certificate Registrar or (ii)
after the occurrence of an Event of Default, Certificate Owners representing
beneficial interests aggregating not less than 50% of the Class Principal
Balance of a Class of Book-Entry Certificates advise the Paying Agent and the
Clearing Agency through the Clearing Agency Participants in writing that the
continuation of a book-entry system through the Clearing Agency
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is no longer in the best interests of the Certificate Owners of a Class of
Book-Entry Certificates, the Certificate Registrar shall notify the Clearing
Agency to effect notification to all Certificate Owners, through the Clearing
Agency, of the occurrence of any such event and of the availability of
Definitive Certificates to Certificate Owners requesting the same. Upon
surrender to the Certificate Registrar of the Book-Entry Certificates by the
Clearing Agency, accompanied by registration instructions from the Clearing
Agency for registration, the Certificate Registrar shall issue the Definitive
Certificates. Neither the Depositor, the Certificate Registrar nor the Trustee
shall be liable for any delay in delivery of such instructions and may
conclusively rely on, and shall be protected in relying on, such instructions.
Upon the issuance of Definitive Certificates all references herein to
obligations imposed upon or to be performed by the Clearing Agency shall be
deemed to be imposed upon and performed by the Certificate Registrar, to the
extent applicable, with respect to such Definitive Certificates and the
Certificate Registrar shall recognize the holders of the Definitive
Certificates as Certificateholders hereunder. Notwithstanding the foregoing,
the Certificate Registrar, upon the instruction of the Depositor, shall have
the right to issue Definitive Certificates on the Closing Date in connection
with credit enhancement programs.
ARTICLE IV
ADMINISTRATION OF THE TRUST FUND
Section 4.01. Custodial Accounts; Distribution Account.
(a) On or prior to the Closing Date, the Master Servicer shall have
caused each Servicer to establish and maintain one or more Custodial Accounts,
as provided in the related Purchase and Servicing Agreement, into which all
Scheduled Payments and unscheduled payments with respect to the related
Mortgage Loans, net of any deductions or reimbursements permitted under the
related Purchase and Servicing Agreement, shall be deposited. On each
Distribution Account Deposit Date, the Servicers shall remit to the Securities
Administrator for deposit into the Distribution Account, all amounts so
required to be deposited into such account in accordance with the terms of the
related Purchase and Servicing Agreements.
(b) The Securities Administrator, as Paying Agent for the Trust, shall
establish and maintain an Eligible Account entitled "Distribution Account of
LaSalle Bank National Association, as Trustee for the benefit of Xxxxxx
Xxxxxxx Mortgage Loan Trust 2006-9AR, Holders of Mortgage Pass-Through
Certificates." The Securities Administrator shall, promptly upon receipt from
the Servicers on each related Distribution Account Deposit Date, deposit into
the Distribution Account and retain on deposit until the related Distribution
Date the following amounts:
(i) the aggregate of collections with respect to the Mortgage Loans
remitted by the Servicers from the related Custodial Accounts in
accordance with the Purchase and Servicing Agreements;
(ii) any amounts required to be deposited by the Master Servicer
with respect to the Mortgage Loans for the related Due Period pursuant to
this Agreement, including
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the amount of any Advances or Compensating Interest Payments with respect
to the Mortgage Loans not paid by the Servicers; and
(iii) any other amounts so required to be deposited in the
Distribution Account in the related Due Period pursuant to this
Agreement.
(c) In the event the Master Servicer or a Servicer has remitted in error
to the Distribution Account any amount not required to be remitted in
accordance with the definition of Available Distribution Amount, it may at any
time direct the Securities Administrator to withdraw such amount from the
Distribution Account for repayment to the Master Servicer or Servicer, as
applicable, by delivery of an Officer's Certificate to the Securities
Administrator and the Trustee which describes the amount deposited in error.
(d) On each Distribution Date and Initial Optional Termination Date, the
Securities Administrator, as Paying Agent, shall withdraw from funds available
in the Distribution Account and distribute the Available Distribution Amount
to the Certificateholders and any other parties entitled thereto in the
amounts and priorities set forth in Section 5.02. The Securities Administrator
may from time to time withdraw from the Distribution Account and pay the
Master Servicer, the Trustee, the Custodians, the Securities Administrator or
any Servicer any amounts permitted to be paid or reimbursed to such Person
from funds in the Distribution Account pursuant to this Agreement, any
Purchase and Servicing Agreement or any Custodial Agreements.
(e) Funds in the Distribution Account may be invested in Permitted
Investments selected by and at the written direction of the Securities
Administrator, which shall mature not later than one Business Day prior to the
Distribution Date (except that if such Permitted Investment is an obligation
of the Securities Administrator or any of its Affiliates, or is managed or
advised by the Securities Administrator or any Affiliate, then such Permitted
Investment shall mature not later than such applicable Distribution Date) and
any such Permitted Investment shall not be sold or disposed of prior to its
maturity. All such Permitted Investments shall be made in the name of the
Trustee (in its capacity as such) or its nominee. All income and gain realized
from any Permitted Investment of amounts on deposit in the Distribution
Account shall be for the benefit of the Securities Administrator, as
additional compensation for its duties hereunder, and shall be subject to its
withdrawal or order from time to time, and shall not be part of the Trust
Fund; provided, however, that if Xxxxx Fargo Bank, National Association is no
longer the Master Servicer and the Securities Administrator, any such income
and gain shall be used to pay the successor Master Servicer and the successor
Securities Administrator, the Master Servicer Compensation and the Securities
Administrator Compensation, respectively. The amount of any losses incurred in
respect of any such investments shall be deposited in such Distribution
Account by the Securities Administrator out of its own funds, without any
right of reimbursement therefor, immediately as realized.
Section 4.02. Permitted Withdrawals from the Custodial Accounts and the
Distribution Account.
(a) Each Servicer may from time to time make withdrawals from its
Custodial Account for the following purposes:
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(i) to reimburse itself for unreimbursed Advances made by it, such
right of reimbursement pursuant to this subclause (i) being limited to
amounts received on the Mortgage Loan(s) in respect of which any such
Advance was made;
(ii) to reimburse itself for any Nonrecoverable Advance previously
made by it;
(iii) to reimburse itself for unreimbursed Servicer Advances, each
Servicer's right to reimbursement pursuant to this clause (a) with
respect to any Mortgage Loan being limited to amounts received on such
Mortgage Loan(s) which represent late recoveries of the payments for
which such advances were made pursuant to the related Purchase and
Servicing Agreement;
(iv) to reimburse itself for expenses incurred by it and
reimbursable pursuant to the related Purchase and Servicing Agreement;
and
(v) to withdraw any amount deposited in the Custodial Account and
not required to be deposited therein.
To the extent required by the related Purchase and Servicing Agreement
each Servicer shall keep and maintain separate accounting, on a Mortgage Loan
by Mortgage Loan basis, for the purpose of justifying any withdrawal from its
Custodial Account pursuant to such subclauses (i), (ii), (iii), (iv) and (v).
Prior to making any withdrawal from its Custodial Account pursuant to
subclause (ii), the related Servicer shall deliver to the Master Servicer an
Officer's Certificate of a Servicing Officer indicating the amount of any
previous Advance determined by the Servicer to be a Nonrecoverable Advance and
identifying the related Mortgage Loans(s), and their respective portions of
such Nonrecoverable Advance.
(b) The Securities Administrator shall withdraw funds from the
Distribution Account for distributions to Certificateholders in the manner
specified in this Agreement (and to withhold from the amounts so withdrawn,
the amount of any taxes that it is authorized to withhold pursuant to Section
10.01). In addition, the Securities Administrator may from time to time make
withdrawals from the Distribution Account for the following purposes:
(i) to pay all costs and expenses described in clause (e) of the
definition of "Available Distribution Amount";
(ii) (x) for so long as Xxxxx Fargo Bank, National Association is
the Master Servicer and the Securities Administrator, to pay to the
Master Servicer the investment earnings on the Distribution Account as
its compensation for the related Distribution Date and (y) thereafter,
concurrently, to the Master Servicer and the Securities Administrator,
the Master Servicer Compensation and the Securities Administrator
Compensation, respectively;
(iii) to withdraw and return to the Master Servicer any amount
deposited in the Distribution Account and not required to be deposited
therein; and
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(iv) to clear and terminate the Distribution Account upon
termination of the Agreement pursuant to Section 7.01 hereof.
(v) [Reserved].
Section 4.03. [Reserved].
Section 4.04. [Reserved].
Section 4.05. Reports to Trustee and Certificateholders.
On each Distribution Date, the Securities Administrator shall have
prepared and shall make available to the Trustee, the Depositor, the Rating
Agencies and each Certificateholder a written report setting forth the
following information (on the basis of Mortgage Loan level information
obtained from the Master Servicer and the Servicers):
(a) the amount of the distributions, separately identified, with respect
to each Class of Certificates;
(b) the amount of the distributions set forth in the clause (a)
allocable to principal, separately identifying the aggregate amount of any
Principal Prepayments, liquidation proceeds or other unscheduled recoveries of
principal included in that amount;
(c) the amount of the distributions set forth in the clause (a)
allocable to interest and how it was calculated;
(d) [reserved];
(e) the Class Principal Balance of each Class of Certificates after
giving effect to the distribution of principal on that Distribution Date;
(f) the aggregate Stated Principal Balance of the Mortgage Loans at the
end of the related Prepayment Period, and the Weighted Average Net Mortgage
Rate and the Mortgage Pool at the beginning of the related Due Period;
(g) [reserved];
(h) [reserved];
(i) the amount of the Servicing Fee paid to or retained by the Master
Servicer and by each Servicer, respectively;
(j) the amount of Monthly Advances for the related Due Period;
(k) for each Distribution Date to and including the Distribution Date in
December 2006: the number and Stated Principal Balance of the Mortgage Loans
that were (A) Delinquent using the MBA Method (exclusive of Mortgage Loans in
foreclosure) (1) 30 to 59 days, (2) 60 to 89 days and (3) 90 or more days, (B)
in foreclosure and Delinquent (1) 30 to 59 days, (2) 60 to
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89 days and (3) 90 or more days and (C) in bankruptcy as of the close of
business on the last day of the calendar month preceding that Distribution
Date;
(l) for each Distribution Date on and after the Distribution Date in
January 2007: the number and Stated Principal Balance of the Mortgage Loans
that were (A) Delinquent using the OTS Method (exclusive of Mortgage Loans in
foreclosure) (1) 30 to 59 days, (2) 60 to 89 days and (3) 90 or more days, (B)
in foreclosure and Delinquent (1) 30 to 59 days, (2) 60 to 89 days and (3) 90
or more days and (C) in bankruptcy as of the close of business on the last day
of the calendar month preceding that Distribution Date;
(m) the total number and principal balance of any REO properties as of
the close of business on the last day of the preceding Due Period;
(n) the amount of Realized Losses incurred during the preceding calendar
month;
(o) the cumulative amount of Realized Losses incurred since the Closing
Date;
(p) the Realized Losses, if any, allocated to each Class of Certificates
on that Distribution Date;
(q) the Class Principal Balance of each Class of Certificates after
giving effect to the distribution of principal on the Distribution Date;
(r) the Pass-Through Rate for each Class of Certificates for that
Distribution Date;
(s) the amount received by the Securities Administrator pursuant to the
Swap Agreement from the Swap Counterparty with respect to that Distribution
Date;
(t) the total amount of Prepayment Penalties collected and due to the
Trust Fund, as reported by the Servicers;
(u) the applicable Record Date(s) for such Distribution Date;
(v) the amount thereof allocable to interest, any Unpaid Interest Amount
included in such distribution and any remaining Unpaid Interest Amount after
giving effect to such distribution, any Basis Risk Carry Forward Amount for
such Distribution Date and the amount of all Basis Risk Carry Forward Amount
covered by withdrawals from the Swap Account and the Supplemental Interest
Trust on such Distribution Date;
(w) if the distribution to the Holders of such Class of Certificates is
less than the full amount that would be distributable to such Holders if there
were sufficient funds available therefor, the amount of the shortfall and the
allocation thereof as between principal and interest, including any Basis Risk
Carry Forward Amount not covered by amounts in the Swap Account and the
Supplemental Interest Trust;
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(x) whether a Trigger Event has occurred and is continuing (including
the calculation demonstrating the existence of the Trigger Event and the
aggregate outstanding balance of all 60+ Day Delinquent Mortgage Loans);
(y) the amount of any Net Monthly Excess Cash Flow on such Distribution
Date and the allocation thereof to the Certificateholders with respect to
Unpaid Interest Amounts, Unpaid Realized Loss Amounts, or Basis Risk Carry
Forward Amounts; and
(z) the amount distributed on the Class OC Certificates.
(aa) the Overcollateralized Amount and the Overcollateralization Target
Amount.
(bb) the amount of any Subsequent Recoveries for such Distribution Date.
The Securities Administrator shall make such reports available each
month via its website at xxxx://xxx.xxxxxxx.xxx. Assistance in using the
website may be obtained by calling the Securities Administrator's customer
service desk at (000) 000-0000. Certificateholders and other parties that are
unable to use the website are entitled to have a paper copy mailed to them via
first class mail by contacting the Securities Administrator and indicating
such. In preparing or furnishing the foregoing reports, the Securities
Administrator shall be entitled to rely conclusively on the accuracy of the
information or data regarding the Mortgage Loans and the related REO
Properties that has been provided to the Securities Administrator by the
Master Servicer and the Servicers, and neither the Trustee nor the Securities
Administrator shall be obligated to verify, recompute, reconcile or
recalculate any such information or data.
Upon the reasonable advance written request of any Certificateholder
that is a savings and loan, bank or insurance company, which request, if
received by the Trustee or any agent thereof, shall be promptly forwarded to
the Securities Administrator, the Securities Administrator shall provide, or
cause to be provided, (or, to the extent that such information or
documentation is not required to be provided by a Servicer under the
applicable Purchase and Servicing Agreement, shall use reasonable efforts to
obtain such information and documentation from such Servicer, and provide) to
such Certificateholders such reports and access to information and
documentation regarding the Mortgage Loans as such Certificateholders may
reasonably deem necessary to comply with applicable regulations of the Office
of Thrift Supervision or its successor or other regulatory authorities with
respect to an investment in the Certificates; provided, however, that the
Securities Administrator shall be entitled to be reimbursed by such
Certificateholders for the Securities Administrator's actual expenses incurred
in providing such reports and access.
ARTICLE V
DISTRIBUTIONS TO HOLDERS OF CERTIFICATES
Section 5.01. Distributions Generally.
(a) Subject to Section 7.01 respecting the final distribution on the
Certificates, on each Distribution Date the Securities Administrator or the
Paying Agent shall make all distributions in accordance with this Article V.
Such distributions shall be made by check
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mailed to each Certificateholder's address as it appears on the Certificate
Register of the Certificate Registrar or, upon written request made to the
Securities Administrator at least five Business Days prior to the related
Record Date by any Certificateholder owning an aggregate initial Certificate
Balance of at least $1,000,000 or in the case of a Class of Notional Amount
Certificates or a Residual Certificate or Class OC Certificate, a Percentage
Interest of not less than 100% by wire transfer in immediately available funds
to an account specified in the request and at the expense of such
Certificateholder; provided, however, that the final distribution in respect
of any Certificate shall be made only upon presentation and surrender of such
Certificate at the Certificate Registrar's Corporate Trust Office; provided,
further, that the foregoing provisions shall not apply to any Class of
Certificates as long as such Certificate remains a Book-Entry Certificate in
which case all payments made shall be made through the Clearing Agency and its
Clearing Agency Participants. Notwithstanding the reduction of the Class
Principal Balance of any Class of Certificates to zero, such Class will be
outstanding hereunder (solely for the purpose of receiving distributions and
not for any other purpose) until the termination of the respective obligations
and responsibilities of the Depositor, the Master Servicer, the Securities
Administrator and the Trustee hereunder in accordance with Article VII. Wire
transfers will be made at the expense of the Holder requesting such wire
transfer by deducting a wire transfer fee from the related distribution.
Notwithstanding such final payment of principal of any of the Certificates,
each Residual Certificate will remain outstanding until the termination of
each REMIC and the payment in full of all other amounts due with respect to
the Residual Certificates and at such time such final payment in retirement of
any Residual Certificate will be made only upon presentation and surrender of
such Certificate at the Certificate Registrar's Corporate Trust Office. If any
payment required to be made on the Certificates is to be made on a day that is
not a Business Day, then such payment will be made on the next succeeding
Business Day.
(b) All distributions or allocations made with respect to the
Certificateholders within each Class on each Distribution Date shall be
allocated among the outstanding Certificates in such Class equally in
proportion to their respective initial Class Principal Balances or Notional
Amounts (or Percentage Interests).
Section 5.02. Priorities of Distribution.
(a) (1) On each Distribution Date, the Securities Administrator shall
withdraw from the Distribution Account the Available Distribution Amount (to
the extent that such amount is then on deposit in the Distribution Account)
and shall distribute such amount to the Certificates in the following order of
priority:
(A) With respect to the portion of Available Distribution Amount for
such Distribution Date consisting of the Interest Remittance Amount for
such Distribution Date, on each Distribution Date, the Securities
Administration shall withdraw the Interest Remittance Amount from the
Available Distribution Amount on deposit in the Distribution Account for
that Distribution Date, and distribute such funds to the specified Class
of Certificates that have outstanding Class Principal Balances and the
Swap Account, sequentially, in the following order of priority:
(i) to the Swap Account, the sum of (x) all Net Swap Payments and
(y) any Swap Termination Payment owed to the Swap Counterparty,
including,
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without limitation, any Senior Defaulted Swap Termination
Payment, but not including any other Defaulted Swap Termination
Payment owed to the Swap Counterparty, if any;
(ii) concurrently, to the Class A-R, Class A-1, Class A-2, Class
A-3, Class A-4, Class A-5 and Class A-6 Certificates their
respective Class A Interest Distribution Amounts for such
Distribution Date, pro rata, based on their respective Class A
Interest Distribution Amounts for such Distribution Date;
(iii) sequentially, to the Class X-0, Xxxxx X-0, Class M-3, Class
M-4, Class M-5, Class M-6, Class B-1, Class B-2 and Class B-3
Certificates, in that order, their respective Subordinated
Interest Distribution Amounts, in each case, to the extent of
the Interest Remittance Amount remaining after distributions of
interest to the Classes of Certificates with a higher payment
priority; and
(iv) any remaining Interest Remittance Amount on any Distribution
Date will be distributed pursuant to Section 5.02(a)(1)(C)
hereof.
(B)(i) On each Distribution Date (a) prior to the Stepdown Date or (b)
on which a Trigger Event is in effect, the Swap Counterparty and the
Holders of each Class of Certificates shall be entitled to receive
payments and distributions in respect of principal from the Principal
Distribution Amount, respectively, in the following order of priority:
(i) to the Swap Account, the sum of (x) all Net Swap Payments and
(y) any Swap Termination Payment owed to the Swap Counterparty,
including, without limitation, any Senior Defaulted Swap
Termination Payment, but not including any other Defaulted Swap
Termination Payment owed to the Swap Counterparty, if any,
remaining unpaid on that Distribution Date after distributions
under Section 5.02(a)(1)(A)(i) for that Distribution Date;
(ii) sequentially, first to the holders of the Class A-R
Certificates, until its Class Principal Balance is reduced to
zero, and second, to the holders of the Class A Certificates
pursuant to Section 5.03 hereof, until their respective Class
Principal Balances are reduced to zero;
(iii) sequentially, to the holders of the Class X-0, Xxxxx X-0,
Class M-3, Class M-4, Class M-5, Class M-6, Class B-1, Class
B-2 and Class B-3 Certificates, in that order, until their
respective Class Principal Balances are reduced to zero; and
(iv) any remaining Principal Distribution Amount on any Distribution
Date will be will be distributed pursuant to Section
5.02(a)(1)(C) hereof; or
(ii) On each Distribution Date (a) on or after the Stepdown
Date and (b) on which a Trigger Event is not in effect, the Swap
Counterparty and the Holders of each
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Class of Certificates shall be entitled to receive payments and
distributions in respect of principal from the Principal
Distribution Amount, respectively, in the following order of
priority:
(i) to the Swap Account, the sum of (x) all Net Swap Payments
and (y) any Swap Termination Payment owed to the Swap
Counterparty, including, without limitation, any Senior
Defaulted Swap Termination Payment, but not including any
other Defaulted Swap Termination Payment owed to the Swap
Counterparty, if any, remaining unpaid on that
Distribution Date after distributions under Section
5.02(a)(1)(A)(i) for that Distribution Date;
(ii) to the holders of the Senior Certificates pursuant to
Section 5.03 hereof, until their respective Class
Principal Balances are reduced to zero;
(iii) to the Class M-1 Certificates, the Class M-1 Principal
Distribution Amount, until its Class Principal Balance is
reduced to zero;
(iv) to the Class M-2 Certificates, the Class M-2 Principal
Distribution Amount, until its Class Principal Balance is
reduced to zero;
(v) to the Class M-3 Certificates, the Class M-3 Principal
Distribution Amount, until its Class Principal Balance is
reduced to zero;
(vi) to the Class M-4 Certificates, the Class M-4 Principal
Distribution Amount, until its Class Principal Balance is
reduced to zero;
(vii) to the Class M-5 Certificates, the Class M-5 Principal
Distribution Amount, until its Class Principal Balance is
reduced to zero;
(viii) to the Class M-6 Certificates, the Class M-6 Principal
Distribution Amount, until its Class Principal Balance is
reduced to zero;
(ix) to the Class B-1 Certificates, the Class B-1 Principal
Distribution Amount, until its Class Principal Balance is
reduced to zero;
(x) to the Class B-2 Certificates, the Class B-2 Principal
Distribution Amount, until its Class Principal Balance is
reduced to zero; and
(xi) to the Class B-3 Certificates, the Class B-3 Principal
Distribution Amount, until its Class Principal Balance is
reduced to zero;
(xii) any remaining Principal Distribution Amount on any
Distribution Date will be distributed pursuant to Section
5.02(a)(1)(C) hereof.
(C) On each Distribution Date the remaining Net Monthly Excess Cashflow,
after giving effect to the distribution of the Extra Principal Distribution
Amount for that Distribution
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Date, shall be distributed to the Swap Counterparty and the Certificates in
the following order of priority, in each case to the extent of the amounts
remaining:
(i) to the Swap Account, the sum of (x) all Net Swap Payments
and (y) any Swap Termination Payment owed to the Swap Counterparty,
including, without limitation, any Senior Defaulted Swap Termination
Payment, but not including any other Defaulted Swap Termination
Payment owed to the Swap Counterparty, if any, remaining unpaid on
that Distribution Date after distributions under Sections
5.02(a)(1)(A)(i), 5.02(a)(1)(B)(i) and 5.02(a)(1)(B)(ii) for that
Distribution Date;
(ii) to the Class M-1 Certificates, the related Interest Carry
Forward Amount;
(iii) to the Class M-1 Certificates, the related Unpaid
Realized Loss Amount;
(iv) to the Class M-2 Certificates, the related Interest Carry
Forward Amount;
(v) to the Class M-2 Certificates, the related Unpaid Realized
Loss Amount;
(vi) to the Class M-3 Certificates, the related Interest Carry
Forward Amount;
(vii) to the Class M-3 Certificates, the related Unpaid
Realized Loss Amount;
(viii) to the Class M-4 Certificates, the related Interest
Carry Forward Amount;
(ix) to the Class M-4 Certificates, the related Unpaid Realized
Loss Amount;
(x) to the Class M-5 Certificates, the related Interest Carry
Forward Amount;
(xi) to the Class M-5 Certificates, the related Unpaid Realized
Loss Amount;
(xii) to the Class M-6 Certificates, the related Interest Carry
Forward Amount;
(xiii) to the Class M-6 Certificates, the related Unpaid
Realized Loss Amount;
(xiv) to the Class B-1 Certificates, the related Interest Carry
Forward Amount;
(xv) to the Class B-1 Certificates, the related Unpaid Realized
Loss Amount;
(xvi) to the Class B-2 Certificates, the related Interest Carry
Forward Amount;
(xvii) to the Class B-2 Certificates, the related Unpaid
Realized Loss Amount;
(xviii) to the Class B-3 Certificates, the related Interest
Carry Forward Amount;
(xix) to the Class B-3 Certificates, the related Unpaid
Realized Loss Amount;
(xx) sequentially, first (i) concurrently, to the Class A
Certificates with Basis Risk Carry Forward Amounts on that
Distribution Date, first pro rata, based on their respective Class
Principal Balances to the extent needed to pay any Basis Risk Carry
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Forward Amount Carryover for each such Class and then, pro rata,
based on any Basis Risk Carry Forward Amount Carryover for each such
Class, in an amount up to the amount of any Basis Risk Carry Forward
Amount remaining unpaid for such Classes of Certificates and then
(ii) sequentially, to the Class X-0, Xxxxx X-0, Class M-3, Class
M-4, Class M-5, Class M-6, Class B-1, Class B-2 and Class B-3
Certificates, in that order, in an amount up to the amount of any
Basis Risk Carry Forward Amount for such Classes of Certificates;
(xxi) sequentially, first (i) concurrently, to the Class A
Certificates, first pro rata, based on their respective Class
Principal Balances to the extent needed to pay any Unpaid Interest
Shortfall Amount for each such Class and then, pro rata, based on
any Unpaid Interest Shortfall Amount for each such Class, in an
amount up to the amount of any Unpaid Interest Shortfall Amount
remaining unpaid for such Classes of Certificates and then (ii)
sequentially, to the Class X-0, Xxxxx X-0, Class M-3, Class M-4,
Class M-5, Class M-6, Class B-1, Class B-2 and Class B-3
Certificates, in that order, in an amount up to the amount of any
Unpaid Interest Shortfall Amount for such Classes of Certificates;
(xxii) to the Swap Account, the amount of any Defaulted Swap
Termination Payment, other than a Senior Defaulted Swap Termination
Payment, owed to the Swap Counterparty;
(xxiii) to the Class OC Certificates, the Class OC
Distributable Amount; and
(xxiv) to the holders of the Class A-R Certificates, any
remaining amounts; provided that if such Distribution Date is the
Distribution Date immediately following the expiration of the latest
prepayment charge term or any Distribution Date thereafter, then any
such remaining amounts, together with the Class P Distribution
Amount, will be distributed first, to the holders of the Class P
Certificates, until the Class Principal Balance thereof has been
reduced to zero; and second, to the holders of the Class A-R
Certificates.
For the avoidance of doubt, Section 5.02(a)(1)(C) is intended to cause the
Class OC Certificates to receive from amounts remaining after the application
of all other clauses of Section 5.02(a)(1)(C) preceding it, an amount up to
the sum of the Class OC Distributable Amount for that Distribution Date and
any Class OC Distributable Amounts remaining unpaid from prior Distribution
Dates and the Securities Administrator shall construe Section 5.02(a)(1)(C) as
necessary so as to accomplish such result.
(D) On each Distribution Date, the Class P Distribution Amount received
during the related Prepayment Period will be distributed to the holders
of the Class P Certificates. On the Distribution Date in January 2012,
the $1,000 held in trust for the Class P Certificates will be
distributed to the holders of the Class P Certificates.
Section 5.03. Allocation of Principal Payments to Class A Certificates.
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(a) On each Distribution Date on which a Sequential Trigger is not in
effect, except as set forth in Section 5.03(c) hereof, principal will be
distributed to the Class A Certificates concurrently, as follows:
(i) 29.7737361008% to the Class A-1 Certificates, until its
Class Principal Balance has been reduced to zero;
(ii) 60.2262474041% to the Class X-0, Xxxxx X-0, Class A-4 and
Class A-5 Certificates, sequentially, in the following order of
priority:
(A) concurrently, to the Class A-2, Class A-3 and Class A-4
Certificates, as follows:
1. 44.8127685697% to the Class A-2 Certificates, until its
Class Principal Balance has been reduced to zero; and
2. 55.1872314303% sequentially, to the Class A-3 and Class
A-4 Certificates, in that order, until their respective
Class Principal Balances have been reduced to zero; and
(B) to the Class A-5 Certificates, until its Class Principal
Balance has been reduced to zero; and
(iii) 10.0000164951% to the Class A-6 Certificates, until its
Class Principal Balance has been reduced to zero.
(b) On each Distribution Date on which a Sequential Trigger is in
effect, except as set forth in Section 5.03(c) hereof, principal will be
distributed to the Class A Certificates sequentially, in the following order
of priority:
(i) concurrently, (a) 33.0819350641% to the Class A-1
Certificates, until its Class Principal Balance has been reduced to
zero, and (b) 66.0000000000% to the Class X-0, Xxxxx X-0, Class A-4
and Class A-5 Certificates, sequentially, in the following order of
priority:
(A) concurrently, to the Class A-2, Class A-3 and Class A-4
Certificates, as follows:
1. 44.8127685697% to the Class A-2 Certificates, until its
Class Principal Balance has been reduced to zero; and
2. 55.1872314303% sequentially to the Class A-3 and Class A-4
Certificates, in that order, until their respective Class
Principal Balances have been reduced to zero; and
(B) to the Class A-5 Certificates, until its Class Principal
Balance has been reduced to zero; and
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(ii) to the Class A-6 Certificates, until its Class Principal
Balance has been reduced to zero.
(c) Notwithstanding the allocation of principal to the Class A
Certificates described above, in the event that the aggregate Class Principal
Balance of the Subordinated Classes and the Class OC Certificates have been
reduced to zero, principal distributions to the Class A Certificates will be
distributed concurrently, to the Class A-1, Class A-2, Class A-3, Class A-4,
Class A-5 and Class A-6 Certificates, pro rata, until, their respective Class
Principal Balances are reduced to zero; with the exception that if a
Sequential Trigger Event is in effect, principal distributions to the Class A
Certificates will be allocated first, concurrently, to the Class X-0, Xxxxx
X-0, Class A-3, Class A-4 and Class A-5 Certificates, pro rata, until their
respective Class Principal Balances are reduced to zero, and then to the Class
A-6 Certificates, until its Class Principal Balance is reduced to zero.
Section 5.04. Allocation of Losses.
(a) On or prior to each Distribution Date, the Securities Administrator
shall aggregate the information provided by each Servicer with respect to the
total amount of Realized Losses experienced on the Mortgage Loans for the
related Distribution Date.
(b) Realized Losses with respect to the Mortgage Loans on any
Distribution Date shall be allocated as follows:
(i) any Applied Loss Amounts on the Mortgage Loans shall be
allocated first to the Class OC Certificates, until its Class
Principal Balance is reduced to zero, and second, to the
Subordinated Certificates in reverse order of their respective
priorities of payment (beginning with the Class of Class B
Certificates then outstanding with the highest numerical Class
designation or, if no Classes of Class B Certificates are
outstanding, then beginning with the Class of Class M Certificates
then outstanding with the highest numerical Class designation) until
the respective Class Principal Balance of each such Class is reduced
to zero; and
(ii) The Class Principal Balance of the Class of Subordinated
Certificates then outstanding with the highest numerical Class
designation shall be reduced on each Distribution Date by the
amount, if any, by which the aggregate of the Class Principal
Balances of all outstanding Classes of Certificates (after giving
effect to the distribution of principal and the allocation of
Applied Loss Amounts on the Mortgage Loans on such Distribution
Date) exceeds the aggregate Stated Principal Balance of the Mortgage
Loans for the following Distribution Date. For the avoidance of
doubt, no reductions will be made in the Class Principal Balance of
the Class A Certificates in respect of Realized Losses on the
Mortgage Loans.
(c) Any Applied Loss Amounts allocated to a Class of Certificates or any
reduction in the Class Principal Balance of a Class of Certificates pursuant
to Section 5.04(b) above shall be allocated among the Certificates of such
Class in proportion to their respective Certificate Balances.
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(d) Any allocation of Realized Losses to a Certificate or to any
Component or any reduction in the Certificate Balance of a Certificate,
pursuant to Section 5.04(b) above shall be accomplished by reducing the
Certificate Balance or Component Balance thereof, as applicable, immediately
following the distributions made on the related Distribution Date in
accordance with the definition of "Certificate Balance" or "Component
Balance," as the case may be. All Realized Losses or Applied Loss Amounts
allocated to a Class of Component Certificates will be allocated, pro rata, to
the related Components.
(e) For the avoidance of doubt, no Realized Losses on the Mortgage Loans
shall be allocated to the Class P Certificates.
Section 5.05. Advances by the Master Servicer.
If any Servicer fails to remit any Advance required to be made under the
applicable Purchase and Servicing Agreement, the Master Servicer shall itself
make, or shall cause the successor Servicer to make, such Advance. If the
Master Servicer determines that an Advance is required, it shall on the
Business Day preceding the related Distribution Date immediately following
such Determination Date remit to the Securities Administrator from its own
funds (or funds advanced by the applicable Servicer) for deposit in the
Distribution Account immediately available funds in an amount equal to such
Advance. The Master Servicer and each Servicer shall be entitled to be
reimbursed for all Advances made by it. Notwithstanding anything to the
contrary herein, in the event the Master Servicer determines in its reasonable
judgment that an Advance is non-recoverable, the Master Servicer shall be
under no obligation to make such Advance. If the Master Servicer determines
that an Advance is non-recoverable, it shall, on or prior to the related
Distribution Date, deliver an Officer's Certificate to the Trustee and the
Securities Administrator to such effect.
Section 5.06. Compensating Interest Payments.
The amount of compensation payable to the Securities Administrator in
respect of the Mortgage Loans and any Distribution Date shall be reduced (but
not below zero) by the amount of any aggregate Compensating Interest Payment
from the Servicers for such Distribution Date, but only to the extent that
Prepayment Interest Shortfalls relating to such Distribution Date are required
to be paid by the Servicers pursuant to the Purchase and Servicing Agreements,
as amended by the Acknowledgements, but are not actually paid by the Servicer.
Such amount shall not be treated as an Advance and shall not be reimbursable.
Section 5.07. [Reserved].
Section 5.08. Determination of Pass-Through Rates for LIBOR
Certificates.
(a) On each Interest Determination Date after the initial Interest
Determination Date and for so long as any LIBOR Certificates are outstanding,
the Securities Administrator will determine LIBOR on the basis of the British
Bankers' Association ("BBA") "Interest Settlement Rate" for one-month deposits
in U.S. dollars as found on Telerate page 3750 as of 11:00 a.m. London time on
each LIBOR Determination Date. "Telerate Page 3750" means the display page
currently so designated on the Moneyline Telerate Service (formerly the Dow
Xxxxx
85
Markets) (or such other page as may replace that page on that service for the
purpose of displaying comparable rates or prices).
(b) If on any Interest Determination Date, LIBOR cannot be determined as
provided in paragraph (a) of this Section 5.09, the Securities Administrator
shall either (i) request each Reference Bank to inform the Securities
Administrator of the quotation offered by its principal London office for
making one-month United States dollar deposits in leading banks in the London
interbank market, as of 11:00 a.m. (London time) on such Interest
Determination Date or (ii) in lieu of making any such request, rely on such
Reference Bank quotations that appear at such time on the Reuters Screen LIBO
Page (as defined in the International Swap Dealers Association Inc. Code of
Standard Wording, Assumptions and Provisions for Swaps, 1986 Edition), to the
extent available. LIBOR for the next Interest Accrual Period will be
established by the Securities Administrator on each interest Determination
Date as follows:
(i) If on any Interest Determination Date two or more Reference
Banks provide such offered quotations, LIBOR for the next applicable
Interest Accrual Period shall be the arithmetic mean of such offered
quotations (rounding such arithmetic mean upwards if necessary to
the nearest whole multiple of 1/32%).
(ii) If on any Interest Determination Date only one or none of
the Reference Banks provides such offered quotations, LIBOR for the
next Interest Accrual Period shall be whichever is the higher of (i)
LIBOR as determined on the previous Interest Determination Date or
(ii) the Reserve Interest Rate. The "Reserve Interest Rate" shall be
the rate per annum which the Securities Administrator determines to
be either (i) the arithmetic mean (rounded upwards if necessary to
the nearest whole multiple of 1/32%) of the one-month United States
dollar lending rates that New York City banks selected by the
Securities Administrator are quoting, on the relevant Interest
Determination Date, to the principal London offices of at least two
of the Reference Banks to which such quotations are, in the opinion
of the Securities Administrator, being so made, or (ii) in the event
that the Securities Administrator can determine no such arithmetic
mean, the lowest one-month United States dollar lending rate which
New York City banks selected by the Securities Administrator are
quoting on such Interest Determination Date to leading European
banks.
(iii) If on any Interest Determination Date the Securities
Administrator is required but is unable to determine the Reserve
Interest Rate in the manner provided in paragraph (b) above, LIBOR
for the related Classes of Certificates shall be LIBOR as determined
on the preceding applicable Interest Determination Date or (B) in
the case of the first Interest Determination Date, LIBOR shall be
5.400%.
Until all of the LIBOR Certificates are paid in full, the Securities
Administrator will at all times retain at least four Reference Banks for the
purpose of determining LIBOR with respect to each Interest Determination Date.
The Securities Administrator initially shall designate the Reference Banks.
Each "Reference Bank" shall be a leading bank engaged in transactions in
Eurodollar deposits in the international Eurocurrency market, shall not
control, be controlled by, or be under common control with, the Securities
Administrator and shall have an established place of business in London. If
any such Reference Bank should be unwilling or unable to act as
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such or if the Master Servicer should terminate its appointment as Reference
Bank, the Securities Administrator shall promptly appoint or cause to be
appointed another Reference Bank. The Securities Administrator shall have no
liability or responsibility to any Person for (i) the selection of any
Reference Bank for purposes of determining LIBOR or (ii) any inability to
retain at least four Reference Banks which is caused by circumstances beyond
its reasonable control.
(c) The Pass-Through Rate for each Class of LIBOR Certificates for each
Interest Accrual Period shall be determined by the Securities Administrator on
each Interest Determination Date so long as the LIBOR Certificates are
outstanding on the basis of LIBOR and the respective formulae appearing in
footnotes corresponding to the LIBOR Certificates in the table relating to the
Certificates in the Preliminary Statement.
(d) In determining LIBOR, any Pass-Through Rate for the LIBOR
Certificates, any Interest Settlement Rate, or any Reserve Interest Rate, the
Securities Administrator may conclusively rely and shall be protected in
relying upon the offered quotations (whether written, oral or on the Dow Xxxxx
Markets) from the BBA designated banks, the Reference Banks or the New York
City banks as to LIBOR, the Interest Settlement Rate or the Reserve Interest
Rate, as appropriate, in effect from time to time. The Securities
Administrator shall not have any liability or responsibility to any Person for
(i) the selection of New York City banks for purposes of determining any
Reserve Interest Rate or (ii) its inability, following a good-faith reasonable
effort, to obtain such quotations from, the BBA designated banks, the
Reference Banks or the New York City banks or to determine such arithmetic
mean, all as provided for in this Section 5.09.
(e) The establishment of LIBOR and each Pass-Through Rate for the LIBOR
Certificates by the Securities Administrator shall (in the absence of manifest
error) be final, conclusive and binding upon each Holder of a Certificate and
the Securities Administrator.
Section 5.09. The Swap Account.
(a) The Securities Administrator shall establish and maintain the Swap
Account, a separate non-interest bearing trust account for the benefit of the
holders of the Certificates (the "Swap Account") on behalf of the trustee of
the supplemental interest trust. The Swap Account 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 held pursuant to this Agreement. The
Swap Account shall be held by a separate trust (the "Supplemental Interest
Trust") as part of the Assets of the Supplemental Interest Trust. The
Supplemental Interest Trust shall not be an asset of any REMIC. For the
avoidance of doubt, any amounts paid from the Swap Account to the Certificates
shall be deemed to have been distributed from the Supplemental Interest Trust.
(b) On or prior to each Distribution Date prior to the Swap Termination
Date, Swap Termination Payments, Net Swap Payments owed to the Swap
Counterparty and Net Swap Receipts for that Distribution Date shall be
deposited into a trust account (the "Swap Account") established by the
Securities Administrator, on behalf of the Trustee, as part of the Assets of
the Supplemental Interest Trust.
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(c) Funds in the Swap Account shall be distributed to the Certificates
and to the Swap Counterparty in the following order of priority:
(i) to the Swap Counterparty, all Net Swap Payments, if any, owed to
the Swap Counterparty for that Distribution Date;
(ii) to the Swap Counterparty, any Swap Termination Payment,
including, without limitation, any Senior Defaulted Swap Termination
Payment but not including any other Defaulted Swap Termination Payment,
for that Distribution Date;
(iii) concurrently, to the Class X-0, Xxxxx X-0, Class A-3, Class
A-4, Class A-5 and Class A-6 Certificates, pro rata, any unpaid Interest
Carry Forward Amounts;
(iv) sequentially, to the Class X-0, Xxxxx X-0, Class M-3, Class
M-4, Class M-5, Class M-6, Class B-1, Class B-2 and Class B-3
Certificates, in that order, any unpaid Interest Carry Forward Amounts;
(v) to the Certificates in accordance with the principal
distribution rules in effect for such Distribution Date, in an amount
equal to the lesser of: (i) the amount necessary to meet the
Overcollateralization Target for that Distribution Date and (ii) the
aggregate of all prior and current unreimbursed Realized Loss Amounts not
previously distributed;
(vi) concurrently, to the Class X-0, Xxxxx X-0, Class A-3, Class
A-4, Class A-5 and Class A-6 Certificates, pro rata, in an amount up to
their respective Swap Payment Allocations for that Distribution Date, any
remaining Basis Risk Carry Forward Amounts;
(vii) sequentially, to the Class X-0, Xxxxx X-0, Class M-3, Class
M-4, Class M-5, Class M-6, Class B-1, Class B-2 and Class B-3
Certificates, in that order, in an amount up to their respective Swap
Payment Allocations for that Distribution Date, any remaining Basis Risk
Carry Forward Amounts;
(viii) concurrently, to the Certificates, pro rata by need, any
remaining Basis Risk Carry Forward Amounts;
(ix) sequentially to the Class X-0, Xxxxx X-0, Class M-3, Class M-4,
Class M-5, Class M-6, Class B-1, Class B-2 and Class B-3 Certificates, in
that order, any remaining Unreimbursed Realized Loss Amounts;
(x) to the Swap Counterparty, any Defaulted Swap Termination
Payment, other than a Senior Defaulted Swap Termination Payment, owed to
the Swap Counterparty for that Distribution Date; and
(xi) all remaining amounts to the holder of the Class OC
Certificates.
Section 5.10. Certain Matters Regarding The Swap Agreement.
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(a) In the event that, upon the Supplemental Interest Trust entering
into a replacement interest rate swap following the occurrence of an
Additional Termination Event of the type described in Part 1(h)(ii) of the
Swap Agreement, the Supplemental Interest Trust is entitled to receive a
payment from a replacement swap provider, the Securities Administrator shall
direct the replacement swap provider to make such payment to the Swap Account.
Any Senior Defaulted Swap Termination Payment shall be made from the Swap
Account to the Swap Counterparty immediately upon receipt of such payment,
regardless of whether the date of receipt thereof is a Distribution Date. To
the extent that any Replacement Swap Counterparty Payment is made to an
account other than the Swap Account, then, notwithstanding anything to the
contrary contained in this Agreement, any Senior Defaulted Swap Termination
Payment shall be paid to the Swap Counterparty immediately upon receipt of
such Replacement Swap Counterparty Payment, regardless of whether the date of
receipt thereof is a Distribution Date and without regard to anything to the
contrary contained in this Agreement. For the avoidance of doubt, the parties
agree that the Swap Counterparty shall have first priority to any Replacement
Swap Counterparty Payment over the payment by the Supplemental Interest Trust
to Certificateholders, any Servicer, the Master Servicer, the Securities
Administrator, each Custodian or any other Person.
(b) The Securities Administrator shall account for the Supplemental
Interest Trust as a grantor trust under subpart E, Part I of subchapter J of
the Code and not as an asset of any Trust REMIC created pursuant to this
Agreement. The beneficial owners of the Supplemental Interest Trust are the
Class OC Certificateholders. For federal income tax purposes, Net Swap
Payments and Swap Termination Payments payable to the Swap Counterparty shall
be deemed to be paid to the Swap Account from the Master REMIC, first, by the
Holder of the Class OC Certificates and second, other than any Defaulted Swap
Termination Payment, from the Master REMIC by the Holders of the applicable
Class or Classes of Certificates as and to the extent provided in Section
10.01 hereof.
(c) Any Basis Risk Carry Forward Amounts (excluding any such Amounts
attributable to the excess of the REMIC Cap over the Net WAC Pass-Through
Rate) distributed by the Securities Administrator to the Certificateholders
shall be accounted for by the Securities Administrator, for federal income tax
purposes, as amounts paid first to the Holders of the Class OC Certificates,
and then to the respective Class or Classes of Offered Certificates. In
addition, the Securities Administrator shall account for the rights of Holders
of each Class of Offered Certificates to receive the Basis Risk Carry Forward
Amounts from the Swap Account (along with Basis Risk Carry Forward Amounts
payable from Net Monthly Excess Cashflow) as rights in a separate limited
recourse interest rate cap contract written by the Class OC Certificateholders
and the Swap Counterparty in favor of Holders of each such Class.
(d) The Swap Account shall be an "outside reserve fund" for federal
income tax purposes and not an asset of any Trust REMIC. Furthermore, the
Holders of the Class OC Certificates shall be the beneficial owners of the
Supplemental Interest Trust for all federal income tax purposes, and shall be
taxable on all income earned thereon.
(e) With respect to the failure of the Swap Counterparty to perform any
of its payment obligations under the Swap Agreement, the breach by the Swap
Counterparty of any of its representations and warranties made pursuant to the
Swap Agreement, or the termination of
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the Swap Agreement, the Securities Administrator on behalf of the Supplemental
Interest Trust shall send any notices and make any demands, on behalf of the
Supplemental Interest Trust as are required under the Swap Agreement. To the
extent that the Swap Counterparty fails to make any payment required under
terms of the Swap Agreement, the Securities Administrator on behalf of the
Supplemental Interest Trust shall immediately demand that Xxxxxx Xxxxxxx, the
guarantor of the Swap Counterparty's payment obligations under the guarantee
of Xxxxxx Xxxxxxx relating to the Swap Agreement, make any and all payments
then required to be made by Xxxxxx Xxxxxxx pursuant to such guarantee. The
Securities Administrator on behalf of the Supplemental Interest Trust shall
cause any replacement swap provider to provide a copy of the related
replacement interest rate swap agreement to the Securities Administrator on
behalf of the Supplemental Interest Trust and the Depositor.
Notwithstanding any provision contained in this Agreement, the
Securities Administrator shall not be required to make any distributions from
the Swap Account except as expressly set forth in this Section 5.11 or in
Section 5.10.
(f) Upon a Collateralization Event or a Substitution Event, the
Securities Administrator, acting at the written direction of the Depositor,
shall attempt to obtain Rating Agency approval for the ISDA Credit Support
Annex and following final negotiation of the ISDA Credit Support Annex the
Securities Administrator shall demand payment of the Delivery Amount (as
defined in the ISDA Credit Support Annex) on each Valuation Date (as defined
in the ISDA Credit Support Annex) and to perform its other obligations in
accordance with the ISDA Credit Support Annex. If a Delivery Amount is
demanded, the Securities Administrator, acting at the written direction of the
Depositor, shall set up an account in accordance with Section 5.10 to hold
cash or other eligible investments pledged under such ISDA Credit Support
Annex. Any cash or other eligible investments pledged under an ISDA Credit
Support Annex shall not be part of the Distribution Account or the
Supplemental Interest Trust unless they are applied in accordance with such
ISDA Credit Support Annex to make a payment due to the Supplemental Interest
Trust pursuant to the Swap Agreement. If Eligible Credit Support (as defined
in the ISDA Credit Support Annex) with a value equal to the Delivery Amount is
not delivered, the Securities Administrator shall notify the Swap Counterparty
of such failure.
(g) Upon an Event of Default (as defined in the Swap Agreement) or
Termination Event (as defined in the Swap Agreement) for which the
Supplemental Interest Trust has the right to designate an Early Termination
Date (as defined in the Swap Agreement), the Securities Administrator will act
at the written direction of the Depositor as to whether it will designate an
Early Termination Date; provided, however, that the Securities Administrator
shall provide written notice to each Rating Agency following the Event of
Default or Termination Event. Upon the termination of the Swap Agreement under
the circumstances contemplated by this Section 5.11(f), the Securities
Administrator shall use its reasonable best efforts to enforce the rights of
the Supplemental Interest Trust thereunder as may be permitted by the terms of
the Swap Agreement and consistent with the terms hereof, and shall apply the
proceeds of any such efforts to enter into a replacement swap agreement with
another swap provider. To the extent such replacement swap agreement can be
entered into, any termination payments received by the Supplemental Interest
Trust in respect of the terminated swap agreement shall be used, to the extent
necessary, by the Supplemental Interest Trust for the purpose of entering into
such replacement swap agreement.
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(h) In the event that the Issuing Entity receives a Swap Termination
Payment, and a successor Swap Counterparty (or its guarantor) cannot be
obtained, then the Securities Administrator will be required to deposit any
Swap Termination Payment into a reserve account that is a sub-account of the
Swap Account. On each subsequent Distribution Date (so long as funds are
available in such reserve account), the Securities Administrator will be
required to withdraw from the reserve account and deposit into the Swap
Account an amount equal to the amount of any Net Swap Receipt due the Issuing
Entity (calculated in accordance with the terms of the original Swap
Agreement) and treat such amount as a Net Swap Receipt for purposes of
determining the distributions from the Swap Account. The remaining amount in
the reserve account will remain in that account and not treated as a Swap
Termination Payment for purposes of determining the distributions from the
Swap Account until the final Swap Termination Date.
(i) The Swap Counterparty shall be an express third party beneficiary of
this Agreement for the purpose of enforcing the provisions hereof to the
extent of the Swap Counterparty's rights explicitly specified herein as if a
party hereto.
(j) Notwithstanding any contrary provision of this Agreement, no
amendment shall adversely affect in any material respect the Swap Counterparty
without at least ten Business Days' prior notice to the Swap Counterparty and
without the prior written consent of the Swap Counterparty, which consent
shall not be unreasonably withheld. The Depositor shall provide the Swap
Counterparty with prior written notice of any proposed material amendment of
this Agreement
ARTICLE VI
CONCERNING THE TRUSTEE AND
THE SECURITIES ADMINISTRATOR; EVENTS OF DEFAULT
Section 6.01. Duties of Trustee and the Securities Administrator.
(a) The Trustee, except during the continuance of an Event of Default,
and the Securities Administrator undertakes to perform such duties and only
such duties as are specifically set forth in this Agreement. Any permissive
right of the Trustee or the Securities Administrator provided for in this
Agreement shall not be construed as a duty of the Trustee or the Securities
Administrator. If an Event of Default has occurred and has not otherwise been
cured or waived, the Trustee or the Securities Administrator shall exercise
such of the rights and powers vested in it by this Agreement and use the same
degree of care and skill in their exercise as a prudent Person would exercise
or use under the circumstances in the conduct of such Person's own affairs,
unless the Trustee is acting as master servicer, in which case it shall use
the same degree of care and skill (in its capacity as successor Master
Servicer) as a master servicer hereunder.
(b) Each of the Trustee and the Securities Administrator, upon receipt
of all resolutions, certificates, statements, opinions, reports, documents,
orders or other instruments furnished to the Trustee or the Securities
Administrator which are specifically required to be furnished pursuant to any
provision of this Agreement, shall examine them to determine whether they are
in the form required by this Agreement; provided, however, that neither the
Trustee nor
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the Securities Administrator shall be responsible for the accuracy or content
of any such resolution, certificate, statement, opinion, report, document,
order or other instrument furnished by the Master Servicer or any Servicer to
the Trustee or the Securities Administrator pursuant to this Agreement, and
shall not be required to recalculate or verify any numerical information
furnished to the Trustee or the Securities Administrator pursuant to this
Agreement. Subject to the immediately preceding sentence, if any such
resolution, certificate, statement, opinion, report, document, order or other
instrument is found not to conform to the form required by this Agreement in a
material manner the Securities Administrator shall take such action as it
deems appropriate to cause the instrument to be corrected, and if the
instrument is not corrected to the Securities Administrator 's satisfaction,
the Securities Administrator will provide notice thereof to the
Certificateholders and will, at the expense of the Trust Fund, which expense
shall be reasonable given the scope and nature of the required action, take
such further action as directed by the Certificateholders.
(c) Neither the Trustee nor the Securities Administrator shall have any
liability arising out of or in connection with this Agreement, except for its
respective negligence or willful misconduct. Notwithstanding anything in this
Agreement to the contrary, neither the Trustee nor the Securities
Administrator shall be liable for special, indirect or consequential losses or
damages of any kind whatsoever (including, but not limited to, lost profits).
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 willful misconduct; provided, however,
that:
(i) The Trustee shall not be personally liable with respect to any
action taken, suffered or omitted to be taken by it in good faith in
accordance with the direction of Holders of Certificates as provided in
Section 6.18 hereof;
(ii) For all purposes under this Agreement, the Trustee shall not be
deemed to have notice of any 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 the
Trustee at the Corporate Trust Office of the Trustee, and such notice
references the Holders of the Certificates and this Agreement;
(iii) For all purposes under this Agreement, the Securities
Administrator shall not be deemed to have notice of any Event of Default
(other than resulting from a failure by the Master Servicer (i) to remit
funds (or to make Advances) or (ii) to furnish information to the
Securities Administrator when required to do so) unless a Responsible
Officer of the Securities Administrator has actual knowledge thereof or
unless written notice of any event which is in fact such a default is
received by the Securities Administrator at the address provided in
Section 11.07, and such notice references the Holders of the Certificates
and this Agreement;
(iv) No provision of this Agreement shall require the Trustee or the
Securities Administrator 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
indemnity reasonably satisfactory to it against such risk or liability is
not reasonably
92
assured to it; and none of the provisions contained in this Agreement
shall in any event require the Trustee or the Securities Administrator to
perform, or be responsible for the manner of performance of, any of the
obligations of the Master Servicer under this Agreement;
(v) Neither the Trustee nor the Securities Administrator shall be
responsible for any act or omission of each other or the Master Servicer,
the Depositor, the Seller, any Servicer or any Custodian.
(d) The Trustee shall have no duty hereunder with respect to any
complaint, claim, demand, notice or other document it may receive or which may
be alleged to have been delivered to or served upon it by the parties as a
consequence of the assignment of any Mortgage Loan hereunder; provided,
however, that the Trustee shall promptly remit to the Master Servicer, upon
receipt any such complaint, claim, demand, notice or other document (i) which
is delivered to the Corporate Trust Office of the Trustee, (ii) of which a
Responsible Officer has actual knowledge, and (iii) which contains information
sufficient to permit the Trustee to make a determination that the real
property to which such document relates is a Mortgaged Property related to a
Mortgage Loan.
(e) Neither the Trustee nor the Securities Administrator shall be
personally liable with respect to any action taken, suffered or omitted to be
taken by it in good faith in accordance with the direction of the
Certificateholders of any Class holding Certificates which evidence, as to
such Class, Percentage Interests aggregating not less than 25% as to the time,
method and place of conducting any proceeding for any remedy available to the
Trustee or the Securities Administrator or exercising any trust or power
conferred upon the Trustee or the Securities Administrator, as applicable,
under this Agreement or the Acknowledgements.
(f) Neither the Trustee nor the Securities Administrator shall be
required to perform services under this Agreement, or to expend or risk its
own funds or otherwise incur financial liability for the performance of any of
its duties hereunder or the exercise of any of its rights or powers if there
is reasonable ground for believing that the timely payment of its fees and
expenses or the repayment of such funds or indemnity reasonably satisfactory
to it against such risk or liability is not reasonably assured to it, and none
of the provisions contained in this Agreement shall in any event require the
Trustee or the Securities Administrator, as applicable, to perform, or be
responsible for the manner of performance of, any of the obligations of the
Master Servicer or any Servicer under this Agreement or any Purchase and
Servicing Agreement except during such time, if any, as the Trustee shall be
the successor to, and be vested with the rights, duties, powers and privileges
of, the Master Servicer in accordance with the terms of this Agreement.
(g) The Trustee shall not be held liable by reason of any insufficiency
in the Distribution Account resulting from any investment loss on any
Permitted Investment included therein (except to the extent that the Trustee
is the obligor and has defaulted thereon).
(h) Neither the Trustee nor, except as otherwise provided herein, the
Securities Administrator shall have any duty (A) to see to any recording,
filing, or depositing of this Agreement or any agreement referred to herein or
any financing statement or continuation
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statement evidencing a security interest, or to see to the maintenance of any
such recording or filing or depositing or to any rerecording, refiling or
redepositing of any thereof, (B) to see to any insurance, (C) to see to the
payment or discharge of any tax, assessment, or other governmental charge or
any lien or encumbrance of any kind owing with respect to, assessed or levied
against, any part of the Trust Fund other than from funds available in the
Distribution Account, or (D) to confirm or verify the contents of any reports
or certificates of the Master Servicer or any Servicer delivered to the
Trustee or the Securities Administrator pursuant to this Agreement believed by
the Trustee or the Securities Administrator, as applicable, to be genuine and
to have been signed or presented by the proper party or parties.
(i) Neither the Securities Administrator nor the Trustee shall be liable
in its individual capacity for an error of judgment made in good faith by a
Responsible Officer or other officers of the Trustee or the Securities
Administrator, as applicable, unless it shall be proved that the Trustee or
the Securities Administrator, as applicable, was negligent in ascertaining the
pertinent facts.
(j) Notwithstanding anything in this Agreement to the contrary, neither
the Securities Administrator nor the Trustee shall be liable for special,
indirect or consequential losses or damages of any kind whatsoever (including,
but not limited to, lost profits), even if the Trustee or the Securities
Administrator, as applicable, has been advised of the likelihood of such loss
or damage and regardless of the form of action.
(k) Neither the Securities Administrator nor the Trustee shall be
responsible for the acts or omissions of the other, it being understood that
this Agreement shall not be construed to render them agents of one another, or
of any Servicer.
Section 6.02. Certain Matters Affecting the Trustee and the Securities
Administrator.
Except as otherwise provided in Section 6.01:
(i) Each of the Trustee and the Securities Administrator may
request, and may rely and shall be protected in acting or refraining from
acting upon any resolution, Officer's Certificate, certificate of
auditors or any other certificate, statement, instrument, opinion,
report, notice, request, consent, order, approval, bond or other paper or
document believed by it to be genuine and to have been signed or
presented by the proper party or parties;
(ii) Each of the Trustee and the Securities Administrator may
consult with counsel and any advice of its counsel or Opinion of Counsel
shall be full and complete authorization and protection in respect of any
action taken or suffered or omitted by it hereunder in good faith and in
accordance with such advice or Opinion of Counsel;
(iii) Neither the Trustee nor the Securities Administrator shall be
personally liable for any action taken, suffered or omitted by it in good
faith and reasonably believed by it to be authorized or within the
discretion or rights or powers conferred upon it by this Agreement;
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(iv) Unless an Event of Default shall have occurred and be
continuing, 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 at least a
majority in Class Principal Balance (or Percentage Interest) of each
Class of Certificates; provided, however, that, if the payment within a
reasonable time to the Trustee or the Securities Administrator, as
applicable, 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 the security
afforded to it by the terms of this Agreement, the Trustee or the
Securities Administrator, as applicable, may require indemnity reasonably
satisfactory to it against such expense or liability or payment of such
estimated expenses from the Certificateholders as a condition to
proceeding. The reasonable expense thereof shall be paid by the party
requesting such investigation and if not reimbursed by the requesting
party shall be reimbursed to the Trustee or the Securities Administrator,
as applicable, by the Trust Fund;
(v) Each of the Trustee and the Securities Administrator may execute
any of the trusts or powers hereunder or perform any duties hereunder
either directly or by or through agents, custodians or attorneys, which
agents, custodians or attorneys shall have any and all of the rights,
powers, duties and obligations of the Trustee and the Securities
Administrator conferred on them by such appointment, provided that each
of the Trustee and the Securities Administrator shall continue to be
responsible for its duties and obligations hereunder to the extent
provided herein, and provided further that neither the Trustee nor the
Securities Administrator shall be responsible for any misconduct or
negligence on the part of any such agent or attorney appointed with due
care by the Trustee or the Securities Administrator, as applicable;
(vi) 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 the Acknowledgements or to institute, conduct or
defend any litigation hereunder or in relation hereto, in each case 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
applicable, security or indemnity reasonably satisfactory to it against
the costs, expenses and liabilities which may be incurred therein or
thereby;
(vii) The right of the Trustee and the Securities Administrator to
perform any discretionary act enumerated in this Agreement shall not be
construed as a duty, and neither the Trustee nor the Securities
Administrator shall be answerable for other than its negligence or
willful misconduct in the performance of such act; and
(viii) Neither the Trustee nor the Securities Administrator shall be
required to give any bond or surety in respect of the execution of the
Trust Fund created hereby or the powers granted hereunder.
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Section 6.03. Trustee and Securities Administrator Not Liable for
Certificates.
The Trustee and the Securities Administrator make no representations as
to the validity or sufficiency of this Agreement, any Purchase and Servicing
Agreement or Acknowledgement, any Swap Agreement or of the Certificates (other
than, in the case of the Securities Administrator, the certificate of
authentication on the Certificates) or of any Mortgage Loan, or related
document save that the Trustee and the Securities Administrator represent
that, assuming due execution and delivery by the other parties hereto, this
Agreement has been duly authorized, executed and delivered by it and
constitutes its valid and binding obligation, enforceable against it in
accordance with its terms except that such enforceability may be subject to
(A) applicable bankruptcy and insolvency laws and other similar laws affecting
the enforcement of the rights of creditors generally, and (B) general
principles of equity regardless of whether such enforcement is considered in a
proceeding in equity or at law. The Trustee and the Securities Administrator
shall not be accountable for the use or application by the Depositor of funds
paid to the Depositor in consideration of the assignment of the Mortgage Loans
to the Trust Fund by the Depositor or for the use or application of any funds
deposited into the Distribution Account or any other fund or account
maintained with respect to the Certificates. The Trustee and the Securities
Administrator shall not be responsible for the legality or validity of this
Agreement or any other document or agreement described in this Section 6.03 or
the validity, priority, perfection or sufficiency of the security for the
Certificates issued or intended to be issued hereunder. Neither the Trustee
nor, except as otherwise provided herein, the Securities Administrator shall
have any responsibility for filing any financing or continuation statement in
any public office at any time or to otherwise perfect or maintain the
perfection of any security interest or lien granted to it hereunder or to
record this Agreement.
Section 6.04. Trustee and the Securities Administrator May Own
Certificates.
The Trustee and the Securities Administrator and any Affiliate or agent
of either of them in its individual or any other capacity may become the owner
or pledgee of Certificates and may transact banking and trust business with
the other parties hereto and their Affiliates with the same rights it would
have if it were not Trustee, Securities Administrator or such agent.
Section 6.05. Eligibility Requirements for Trustee.
The Trustee hereunder shall at all times be (i) an institution whose
accounts are insured by the FDIC, (ii) a corporation or national banking
association, organized and doing business under the laws of any State or the
United States of America, authorized under such laws to exercise corporate
trust powers, having a combined capital and surplus of not less than
$50,000,000 and subject to supervision or examination by federal or state
authority and (iii) not an Affiliate of the Master Servicer or any Servicer.
If such corporation or national banking association publishes reports of
condition at least annually, pursuant to law or to the requirements of the
aforesaid supervising or examining authority, then, for the purposes of this
Section, the combined capital and surplus of such corporation or national
banking association shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. In case at any
time the Trustee shall cease to be eligible in accordance with provisions of
this Section, the Trustee shall resign immediately in the manner and with the
effect specified in Section 6.06.
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Section 6.06. Resignation and Removal of Trustee and the Securities
Administrator.
(a) The Trustee may at any time resign and be discharged from the trust
hereby created by giving written notice thereof to the Securities
Administrator, the Depositor and the Master Servicer. Upon receiving such
notice of resignation, the Depositor will promptly appoint a successor
trustee, by written instrument, one copy of which instrument shall be
delivered to the resigning Trustee, one copy to the successor trustee, one
copy to the Securities Administrator and one copy to the Master Servicer. If
no successor trustee shall have been so appointed and shall have accepted
appointment within 30 days after the giving of such notice of resignation, the
resigning Trustee may petition any court of competent jurisdiction for the
appointment of a successor trustee.
At least 15 calendar days prior to the effective date of such
resignation, the Trustee shall provide (x) written notice to the Depositor and
the Master Servicer of any successor pursuant to this Section (other than a
successor appointed by the Depositor in accordance with the preceding
paragraph) and (y) in writing and in form and substance reasonably
satisfactory to the Depositor, all information reasonably requested by the
Depositor in order to comply with its reporting obligation under Item 6.02 of
Form 8-K with respect to the resignation of the Trustee.
(b) If at any time (i) the Trustee shall cease to be eligible in
accordance with the provisions of Section 6.05 and shall fail to resign after
written request therefor by the Depositor, (ii) the Trustee shall become
incapable of acting, or shall be adjudged a bankrupt or insolvent, or a
receiver of the Trustee of its property shall be appointed, or any public
officer shall take charge or control of the Trustee or of either of their
property or affairs for the purpose of rehabilitation, conservation or
liquidation, (iii) (A) a tax is imposed or threatened with respect to the
Trust Fund by any state in which the Trustee or the Trust Fund held by the
Trustee is located due to the location of the Trustee, (B) the imposition of
such tax would be avoided by the appointment of a different trustee and (C)
the Trustee fails to indemnify the Trust Fund against such tax (iv) the
continued use of the Trustee would result in a downgrading of the rating by
any Rating Agency of any Class of Certificates with a rating, or (v) the
Trustee fails to comply with its obligations under the penultimate paragraph
of Section 6.14(a), in the preceding paragraph or Article XII and such failure
is not remedied within the lesser of 10 calendar days or such period in which
the applicable Exchange Act Report can be filed timely (without taking into
account any extensions), then, in the case of clauses (i) through (iv), the
Depositor shall remove the Trustee and the Depositor shall appoint a successor
trustee, acceptable to the Master Servicer by written instrument, one copy of
which instrument shall be delivered to the Trustee so removed, one copy to the
successor trustee, one copy to the Securities Administrator and one copy to
the Master Servicer.
(c) The Holders of more than 50% of the Class Principal Balance (or
Percentage Interest) of each Class of Certificates may at any time upon 30
days' written notice to the Trustee and to the Depositor remove the Trustee by
such written instrument, signed by such Holders or their attorney-in-fact duly
authorized, one copy of which instrument shall be delivered to the Depositor,
one copy to the Trustee, one copy to the Securities Administrator and one copy
to the Master Servicer; the Depositor shall thereupon appoint a successor
trustee in accordance with this Section.
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(d) Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to any of the provisions of this Section shall
become effective upon acceptance of appointment by the successor trustee, as
provided in Section 6.07. If no successor trustee shall have been so appointed
and shall have accepted appointment within 30 days after such notice of
dismissal, the Trustee who received such notice of dismissal may petition any
court of competent jurisdiction for the appointment of a successor trustee.
(e) The Securities Administrator shall not resign except in accordance
with the provisions of Sections 9.06 and 9.07 hereof, to the same extent that
the Master Servicer is entitled to resign or assign or delegate, as
applicable, its duties hereunder.
(f) If at any time the Securities Administrator shall cease to be
eligible in accordance with the provisions of Section 9.10 hereof and shall
fail to resign after written request thereto by the Depositor, or if at any
time the Securities Administrator shall become incapable of acting, or shall
be adjudged as bankrupt or insolvent, or a receiver of the Securities
Administrator or of its property shall be appointed, or any public officer
shall take charge or control of the Securities Administrator or of its
property or affairs for the purpose of rehabilitation, conservation or
liquidation, or a tax is imposed with respect to the Trust Fund by any state
in which the Securities Administrator or the Trust Fund is located and the
imposition of such tax would be avoided by the appointment of a different
Securities Administrator, then the Depositor or the Trustee may remove the
Securities Administrator and appoint a successor securities administrator by
written instrument, in triplicate, one copy of which instrument shall be
delivered to the Securities Administrator so removed, one copy of which shall
be delivered to the Master Servicer and one copy to the successor securities
administrator.
(g) If no successor securities administrator shall have been appointed
and shall have accepted appointment within 60 days after Xxxxx Fargo Bank,
N.A., as Securities Administrator, ceases to be the securities administrator
pursuant to this Section 6.06, then the Trustee (as successor Securities
Administrator) shall perform the duties of the Securities Administrator
pursuant to this Agreement. The Trustee shall notify the Rating Agencies of
any change of the Securities Administrator. In such event, the Trustee shall
assume all of the rights and obligations of the Securities Administrator
hereunder arising thereafter except that the Trustee shall not be (i) liable
for losses of the predecessor Securities Administrator or any acts or
omissions of the predecessor Securities Administrator hereunder, (ii) deemed
to have made any representations and warranties of the Securities
Administrator made herein and (iii) subject to the same resignation
limitations as set forth in Section 9.06 hereof; provided, however, that the
Trustee (as successor securities administrator) shall not resign until a
successor securities administrator has accepted appointment pursuant to
Section 6.07 hereof. The Trustee shall not be accountable, shall have no
liability and makes no representation as to any acts or omissions hereunder of
the Securities Administrator until such time as the Trustee may be required to
act as successor Securities Administrator pursuant to this Section 6.06 and
thereupon only for the acts or omissions of the Trustee as successor
Securities Administrator. If the Trustee is unwilling, or unable, to act as
successor Securities Administrator, then, in such event, the Trustee may
appoint, or petition a court of competent jurisdiction to appoint a successor
Securities Administrator meeting the criteria set forth in Section 9.10
hereof. Such successor Securities Administrator shall be entitled to the
Securities Administrator Compensation.
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(h) The Trustee as successor securities administrator shall be entitled
to be reimbursed for all reasonable costs and expenses associated with the
transfer of the duties of the Securities Administrator by the predecessor
Securities Administrator, including, without limitation, any costs or expenses
associated with the complete transfer of all securities administrator data and
the completion, correction or manipulation of such securities administrator
data as may be required by the Trustee as successor securities administrator
to correct any errors or insufficiencies in such securities administrator data
or otherwise to enable the Trustee or successor securities administrator to
perform the duties of the Securities Administrator properly and effectively;
provided, however, that the predecessor Securities Administrator shall not be
obligated to make any such reimbursements if such Securities Administrator was
terminated or removed without cause or if such termination or removal was a
result of the imposition of any tax on the Trust Estate by any state in which
the Securities Administrator or the Trust Fund is located. If such costs are
not paid by the predecessor Securities Administrator, the Trustee shall pay
such costs from the Trust Fund.
(i) The Trustee, as successor Securities Administrator, as compensation
for its activities hereunder as successor Securities Administrator, shall be
entitled to retain or withdraw from the Distribution Account an amount equal
to the Securities Administrator Compensation.
(j) The Holders of Certificates entitled to at least 51% of the Voting
Rights may at any time remove the Securities Administrator and appoint a
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 by the successor
Securities Administrator to the Trustee, one complete set to the Securities
Administrator so removed and one complete set to the successor so appointed.
Notice of any removal of the Securities Administrator shall be given to each
Rating Agency by the successor securities administrator.
(k) Any resignation or removal of the Securities Administrator and
appointment of a successor securities administrator pursuant to any of the
provisions of this Section 6.06 or Section 9.06 shall become effective upon
acceptance by the successor securities administrator of appointment as
provided in Section 6.07 hereof.
(l) If the Securities Administrator and the Master Servicer are the same
Person, any removal of the Master Servicer pursuant to an Event of Default
shall also result in the removal of the Securities Administrator and require
the appointment of a successor pursuant to this Section and Section 6.07.
(m) The Securities Administrator shall cooperate with the Trustee and
any successor securities administrator in effecting the termination of the
Securities Administrator's responsibilities and rights hereunder, providing to
the Trustee and successor securities administrator all documents and records
in electronic or other form reasonably requested by it to enable it to assume
the Securities Administrator's functions hereunder and for the transfer to the
Trustee or successor Securities Administrator of all amounts in the
Distribution Account or any other account or fund maintained by the Securities
Administrator with respect to the Trust Fund. Neither the Trustee nor the
Master Servicer, as applicable, nor any other successor, as applicable, shall
be deemed to be in default hereunder by reason of any failure to make, or any
delay in
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making, any distribution hereunder or any portion thereof caused by (i) the
failure of the predecessor Securities Administrator to deliver, or any delay
in delivering, cash, documents or records to it, (ii) the failure of the
predecessor Securities Administrator to cooperate as required by this
Agreement, (iii) the failure of the predecessor Securities Administrator to
deliver the related Mortgage Loan data as required by this Agreement or (iv)
restrictions imposed by any regulatory authority having jurisdiction over the
predecessor Securities Administrator. No successor securities administrator
shall be deemed to be in default hereunder by reason of any failure to make,
or any delay in making, any distribution hereunder or any portion thereof
caused by (i) the failure of the Master Servicer to deliver, or any delay in
delivering cash, documents or records to it related to such distribution, or
(ii) the failure of Trustee or the Master Servicer to cooperate as required by
this Agreement.
Section 6.07. Successor Trustee and Successor Securities Administrator.
(a) Any successor trustee or successor securities administrator
appointed as provided in Section 6.06 shall execute, acknowledge and deliver
to the Depositor and to its predecessor trustee or predecessor securities
administrator, as applicable, an instrument accepting such appointment
hereunder, and thereupon the resignation or removal of the predecessor trustee
or predecessor securities administrator, as applicable, shall become effective
and such successor trustee or successor securities administrator, as
applicable, without any further act, deed or conveyance, shall become fully
vested with all the rights, powers, duties and obligations of its predecessor
hereunder, with like effect as if originally named as trustee or securities
administrator, as applicable, herein. The predecessor trustee or predecessor
securities administrator, as applicable, shall deliver to the successor
trustee or successor securities administrator, as applicable, all Trustee
Mortgage Files and documents and statements related to each Trustee Mortgage
File held by it hereunder, and shall duly assign, transfer, deliver and pay
over to the successor trustee the entire Trust Fund, together with all
necessary instruments of transfer and assignment or other documents properly
executed necessary to effect such transfer and such of the records or copies
thereof maintained by the predecessor trustee in the administration hereof as
may be requested by the successor trustee and shall thereupon be discharged
from all duties and responsibilities under this Agreement. In addition, the
Depositor and the predecessor trustee or predecessor securities administrator,
as applicable, shall execute and deliver such other instruments and do such
other things as may reasonably be required to more fully and certainly vest
and confirm in the successor trustee or successor securities administrator, as
applicable, all such rights, powers, duties and obligations.
(b) No successor trustee shall accept appointment as provided in this
Section unless at the time of such appointment such successor trustee shall be
eligible under the provisions of Section 6.05 and has provided to the
Depositor in writing and in form and substance reasonably satisfactory to the
Depositor, all information reasonably requested by the Depositor in order to
comply with its reporting obligation under Item 6.02 of Form 8-K with respect
to a replacement Trustee.
(c) Upon acceptance of appointment by a successor trustee or successor
securities administrator, as applicable, as provided in this Section, the
Master Servicer shall mail notice of the succession of such trustee or
securities administrator, as applicable, hereunder to all Holders
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of Certificates at their addresses as shown in the Certificate Register and to
any Rating Agency. The costs of such mailing shall be borne by the Master
Servicer.
(d) Any successor securities administrator shall also either serve as
auction administrator pursuant to Section 7.01(b) hereof or select an
investment bank to act as auction administrator at the expense of the Trust
Fund.
(e) Any successor trustee or successor securities administrator
appointed as provided in Section 6.06 shall also be the successor trustee or
successor securities administrator, as applicable, with respect to the
Supplemental Interest Trust.
Section 6.08. Merger or Consolidation of Trustee or the Securities
Administrator.
Any Person into which the Trustee or Securities Administrator may be
merged or with which it may be consolidated, or any Person resulting from any
merger, conversion or consolidation to which the Trustee or Securities
Administrator shall be a party, or any Persons succeeding to the business of
the Trustee or Securities Administrator, shall be the successor to the Trustee
or Securities Administrator hereunder, without the execution or filing of any
paper or any further act on the part of any of the parties hereto, anything
herein to the contrary notwithstanding, provided that, in the case of the
Trustee, such Person shall be eligible under the provisions of Section 6.05.
At least 15 calendar days prior to the effective date of any succession
by merger or consolidation of the Trustee or the Securities Administrator, the
Trustee or the Securities Administrator, as applicable, shall provide (x)
written notice to the Depositor of any successor pursuant to this Section and
(y) in writing and in form and substance reasonably satisfactory to the
Depositor, all information reasonably requested by the Depositor in order to
comply with its reporting obligation under Item 6.02 of Form 8-K with respect
to a replacement Trustee or Securities Administrator, as applicable.
Section 6.09. Appointment of Co-Trustee, Separate Trustee or Custodian.
(a) Notwithstanding any other provisions hereof, at any time, the
Trustee, the Depositor or the Certificateholders evidencing more than 50% of
the Class Principal Balance (or Percentage Interest) of every Class of
Certificates shall have the power from time to time to appoint one or more
Persons, approved by the Trustee, to act either as co-trustees jointly with
the Trustee, or as separate trustees, or as custodians, for the purpose of
holding title to, foreclosing or otherwise taking action with respect to any
Mortgage Loan outside the state where the Trustee has its principal place of
business where such separate trustee or co-trustee is necessary or advisable
(or the Trustee has been advised by the Master Servicer that such separate
trustee or co-trustee is necessary or advisable) under the laws of any state
in which a property securing a Mortgage Loan is located or for the purpose of
otherwise conforming to any legal requirement, restriction or condition in any
state in which a property securing a Mortgage Loan is located or in any state
in which any portion of the Trust Fund is located. The separate Trustees,
co-trustees, or custodians so appointed shall be trustees or custodians for
the benefit of all the Certificateholders and shall have such powers, rights
and remedies as shall be specified in the instrument of appointment; provided,
however, that no such appointment shall, or shall be deemed to,
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constitute the appointee an agent of the Trustee. The obligation of the Master
Servicer to make Advances pursuant to Section 5.05 hereof shall not be
affected or assigned by the appointment of a co-trustee.
(b) Every separate trustee, co-trustee, and custodian shall, to the
extent permitted by law, be appointed and act subject to the following
provisions and conditions:
(i) all powers, duties, obligations and rights conferred upon the
Trustee in respect of the receipt, custody and payment of moneys shall be
exercised solely by the Trustee;
(ii) all other rights, powers, duties and obligations conferred or
imposed upon the Trustee shall be conferred or imposed upon and exercised
or performed by the Trustee and such separate trustee, co-trustee, or
custodian jointly, except to the extent that under any law of any
jurisdiction in which any particular act or acts are to be performed the
Trustee shall be incompetent or unqualified to perform such act or acts,
in which event such rights, powers, duties and obligations, including the
holding of title to the Trust Fund or any portion thereof in any such
jurisdiction, shall be exercised and performed by such separate trustee,
co-trustee, or custodian;
(iii) no trustee or custodian hereunder shall be personally liable
by reason of any act or omission of any other trustee or custodian
hereunder; and
(iv) the Trustee may at any time, by an instrument in writing
executed by it, with the concurrence of the Depositor, accept the
resignation of or remove any separate trustee, co-trustee or custodian,
so appointed by it or them, if such resignation or removal does not
violate the other terms of this Agreement.
(c) Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee, co-trustee or custodian shall refer to this
Agreement and the conditions of this Article VI. Each separate trustee and
co-trustee, upon its acceptance of the trusts conferred, shall be vested with
the estates or property specified in its instrument of appointment, either
jointly with the Trustee or separately, as may be provided therein, subject to
all the provisions of this Agreement, specifically including every provision
of this Agreement relating to the conduct of, affecting the liability of, or
affording protection to, the Trustee. Every such instrument shall be filed
with the Trustee and a copy given to the Master Servicer.
(d) Any separate trustee, co-trustee or custodian may, at any time,
constitute the Trustee its agent or attorney-in-fact with full power and
authority, to the extent not prohibited by law, to do any lawful act under or
in respect of this Agreement on its behalf and in its name. If any separate
trustee, co-trustee or custodian shall die, become incapable of acting, resign
or be removed, all of its estates, properties, rights, remedies and trusts
shall vest in and be exercised by the Trustee, to the extent permitted by law,
without the appointment of a new or successor trustee.
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(e) No separate trustee, co-trustee or custodian hereunder shall be
required to meet the terms of eligibility as a successor trustee under Section
6.05 hereunder and no notice to the Certificateholders of the appointment
shall be required under Section 6.07 hereof.
(f) The Securities Administrator on behalf of the Trustee agrees to
instruct the co-trustees, if any, to the extent necessary to fulfill the
Trustee's obligations hereunder.
(g) The Trust shall pay the reasonable compensation of the co-trustees
(which compensation shall not reduce any compensation payable to the Trustee
under such Section).
Section 6.10. Authenticating Agents.
(a) The Trustee may appoint one or more Authenticating Agents which
shall be authorized to act on behalf of the Trustee in authenticating
Certificates. The Securities Administrator is hereby appointed as initial
Authenticating Agent, and the Securities Administrator accepts such
appointment. Wherever reference is made in this Agreement to the
authentication of Certificates by the Trustee or the Trustee's certificate of
authentication, such reference shall be deemed to include authentication on
behalf of the Trustee by an Authenticating Agent and a certificate of
authentication executed on behalf of the Trustee by an Authenticating Agent.
Each Authenticating Agent must be a corporation organized and doing business
under the laws of the United States of America or of any state, having a
combined capital and surplus of at least $15,000,000, authorized under such
laws to do a trust business and subject to supervision or examination by
federal or state authorities.
(b) Any Person into which any Authenticating Agent may be merged or
converted or with which it may be consolidated, or any Person resulting from
any merger, conversion or consolidation to which any Authenticating Agent
shall be a party, or any Person succeeding to the corporate agency business of
any Authenticating Agent, shall continue to be the Authenticating Agent
without the execution or filing of any paper or any further act on the part of
the Trustee or the Authenticating Agent.
(c) Any Authenticating Agent may at any time resign by giving at least
30 days' advance written notice of resignation to the Trustee and the
Depositor. The Trustee may at any time terminate the agency of any
Authenticating Agent by giving written notice of termination to such
Authenticating Agent and the Depositor. Upon receiving a notice of resignation
or upon such a termination, or in case at any time any Authenticating Agent
shall cease to be eligible in accordance with the provisions of this Section
6.10, the Trustee may appoint a successor authenticating agent, shall give
written notice of such appointment to the Depositor and shall mail notice of
such appointment to all Holders of Certificates. Any successor authenticating
agent upon acceptance of its appointment hereunder shall become vested with
all the rights, powers, duties and responsibilities of its predecessor
hereunder, with like effect as if originally named as Authenticating Agent. No
successor authenticating agent shall be appointed unless eligible under the
provisions of this Section 6.10. No Authenticating Agent shall have
responsibility or liability for any action taken by it as such at the
direction of the Trustee.
Section 6.11. Indemnification of the Trustee and the Securities
Administrator.
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The Trustee (in its individual capacity and in its representative
capacity as Trustee hereunder) and the Securities Administrator and their
respective directors, officers, employees and agents shall be entitled to
indemnification from the Trust Fund for any loss, liability or expense
(including the reasonable compensation and the expenses and disbursements of
its agents or counsel), incurred without negligence or willful misconduct on
their part, arising out of, or in connection with, the acceptance or
administration of the trusts created hereunder or under the Purchase and
Servicing Agreements, the Acknowledgements, the Custodial Agreements, or the
Swap Agreement or in connection with the performance of their duties hereunder
or thereunder including the costs and expenses of defending themselves against
any claim in connection with the exercise or performance of any of their
powers or duties hereunder or thereunder, provided that:
(i) with respect to any such claim, the Trustee or the Securities
Administrator, as applicable, shall have given the Depositor written
notice thereof promptly after the Trustee, the Securities Administrator,
as applicable, shall have knowledge thereof;
(ii) while maintaining control over its own defense, the Trustee or
the Securities Administrator, as applicable, shall cooperate and consult
fully with the Depositor in preparing such defense; and
(iii) notwithstanding anything to the contrary in this Section 6.11,
the Trust Fund shall not be liable for settlement of any such claim by
the Trustee or the Securities Administrator, as applicable, entered into
without the prior consent of the Depositor, which consent shall not be
unreasonably withheld.
The provisions of this Section 6.11 shall survive any termination of
this Agreement and the resignation or removal of the Trustee or the Securities
Administrator or Custodian, as applicable, and shall be construed to include,
but not be limited to any loss, liability or expense under any environmental
law.
Section 6.12. Fees and Expenses of the Master Servicer, Securities
Administrator, the Trustee and the Custodians.
(a) For so long as Xxxxx Fargo Bank, National Association is the Master
Servicer and the Securities Administrator, the Securities Administrator shall
be entitled to be paid by the Master Servicer reasonable compensation for the
Securities Administrator's services hereunder in an amount to be agreed upon
between the Master Servicer and the Securities Administrator. Should Xxxxx
Fargo Bank, National Association no longer be both the Master Servicer and the
Securities Administrator, the Securities Administrator shall be entitled to
receive the Securities Administrator Compensation payable pursuant to Section
4.02(b)(ii) hereof. The Securities Administrator shall be entitled to all
disbursements and advancements incurred or made by the Securities
Administrator in accordance with this Agreement (including fees and expenses
of its counsel and all persons not regularly in its employment), except any
such expenses arising from its negligence, bad faith or willful misconduct.
(b) As compensation for its services hereunder, the Trustee and each
Custodian shall each be entitled to receive a fee (which, in the case of the
Trustee, shall not be limited by
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any provision of law in regard to the compensation of a trustee of an express
trust) which shall be paid by the Master Servicer pursuant to a separate
agreement between the Trustee, the Custodians and the Master Servicer. Any
expenses incurred by the Trustee or the Custodians shall be reimbursed in
accordance with Section 6.11. Notwithstanding any provision in any Custodial
Agreement to the contrary, the parties hereto acknowledge and agree that (i)
the Master Servicer shall only be obligated to pay to each Custodian the fee
agreed to by such Custodian and the Master Servicer in the separate fee
agreement referred to above, and (ii) except as may be expressly set forth
therein with respect to the Master Servicer, in no event shall the Master
Servicer have any responsibility or liability for the payment of any other
fees or any expenses or other amounts, if any, that may be payable to a
Custodian under the related Custodial Agreement, all of which shall be payable
in accordance with the terms and conditions of such Custodial Agreement.
Section 6.13. Collection of Monies.
Except as otherwise expressly provided in this Agreement, the Securities
Administrator on behalf of the Trustee may demand payment or delivery of, and
shall receive and collect, all money and other property payable to or
receivable by the Securities Administrator on behalf of the Trustee pursuant
to this Agreement. The Securities Administrator on behalf of the Trustee shall
hold all such money and property received by it as part of the Trust Fund and
shall distribute it as provided in this Agreement.
Section 6.14. Events of Default; Trustee To Act; Appointment of
Successor.
(a) The occurrence of any one or more of the following events shall
constitute an "Event of Default" with respect to the Master Servicer:
(i) Any failure by the Master Servicer to furnish the Securities
Administrator the Mortgage Loan data on the Mortgage Loans sufficient to
prepare the reports described in Section 4.05 which continues unremedied
for a period of one Business Day after the date upon which written notice
of such failure shall have been given to the Master Servicer by the
Trustee or the Securities Administrator or to the Master Servicer, the
Securities Administrator and the Trustee by the Holders of not less than
25% of the Class Principal Balance or Percentage Interest of each Class
of Certificates affected thereby; or
(ii) Any failure on the part of the Master Servicer duly to observe
or perform in any material respect any other of the covenants or
agreements (other than those referred to in (vii) and (ix) below) on the
part of the Master Servicer contained in this Agreement (including any
obligation to enforce any Purchase and Servicing Agreement) or any
representation or warranty of the Master Servicer shall prove to be
untrue in any material respect, which failure or breach continues
unremedied for a period of 60 days after the date on which written notice
of such failure, requiring the same to be remedied, shall have been given
to the Master Servicer by the Trustee or the Securities Administrator, or
to the Master Servicer, the Securities Administrator and the Trustee by
the Holders of more than 50% of the Aggregate Voting Interests of the
Certificates; provided that the sixty-day cure period shall not apply so
long as the Depositor is
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required to file Exchange Act Reports with respect to the Trust Fund, the
failure to comply with the requirements set forth in Section 9.11,
Section 9.05 and Section 9.06 (with respect to notice and information to
be provided to the Depositor) or Article XII, for which the grace period
shall not exceed the lesser of 10 calendar days or such period in which
the applicable Exchange Act Report can be filed timely (without taking
into account any extensions); or
(iii) A decree or order of a court or agency or supervisory
authority having jurisdiction for the appointment of a conservator or
receiver or liquidator in any insolvency, readjustment of debt,
marshalling of assets and liabilities or similar proceedings, 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 60 days or any Rating
Agency reduces or withdraws or threatens to reduce or withdraw the rating
of the Certificates because of the financial condition or loan servicing
capability of such Master Servicer; or
(iv) The Master Servicer shall consent to the appointment of a
conservator or receiver or liquidator in any insolvency, readjustment of
debt, marshalling of assets and liabilities, voluntary liquidation or
similar proceedings of or relating to the Master Servicer or of or
relating to all or substantially all of its property; or
(v) The Master Servicer shall admit in writing its inability to pay
its debts generally as they become due, file a petition to take advantage
of any applicable insolvency or reorganization statute, make an
assignment for the benefit of its creditors or voluntarily suspend
payment of its obligations; or
(vi) The Master Servicer shall be dissolved, or shall dispose of all
or substantially all of its assets, or consolidate with or merge into
another entity or shall permit another entity to consolidate or merge
into it, such that the resulting entity does not meet the criteria for a
successor servicer as specified in Section 9.05 hereof; or
(vii) If a representation or warranty set forth in Section 9.03
hereof shall prove to be incorrect as of the time made in any respect
that materially and adversely affects the interests of the
Certificateholders, and the circumstance or condition in respect of which
such representation or warranty was incorrect shall not have been
eliminated or cured within 90 days after the date on which written notice
of such incorrect representation or warranty shall have been given to the
Master Servicer by the Trustee or the Securities Administrator, or to the
Master Servicer, the Securities Administrator and the Trustee by the
Holders of more than 50% of the Aggregate Voting Interests of the
Certificates; or
(viii) A sale or pledge of any of the rights of the Master Servicer
hereunder or an assignment of this Agreement by the Master Servicer or a
delegation of the rights or duties of the Master Servicer hereunder shall
have occurred in any manner not otherwise permitted hereunder and without
the prior written consent of the Trustee and Certificateholders holding
more than 50% of the Aggregate Voting Interests of the Certificates; or
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(ix) After receipt of notice from the Trustee or the Securities
Administrator, any failure of the Master Servicer to make any Advances
required to be made by it hereunder; or
(x) (a) Any failure by the Master Servicer to deposit in the
Distribution Account or remit to the Securities Administrator any payment
required to be made by the Master Servicer under the terms of this
Agreement (other than an Advance required pursuant to Section 5.05
hereof), which failure shall continue unremedied for three Business Days
after the date upon which written notice of such failure shall have been
given to the Master Servicer by the Securities Administrator, Trustee or
the Depositor or to the Master Servicer and the Trustee by the Holders of
Certificates having not less than 25% of the Voting Rights evidenced by
the Certificates or (b) any failure by the Master Servicer to deposit in
the Distribution Account or remit to the Securities Administrator any
Advance required to be made by the Master Servicer under Section 5.05
hereof, which failure shall continue unremedied for one Business Day
after the date upon which written notice of such failure shall have been
given to the Master Servicer by the Securities Administrator, Trustee or
the Depositor or to the Master Servicer and the Trustee by the Holders of
Certificates having not less than 25% of the Voting Rights evidenced by
the Certificates; or
(xi) If the Master Servicer and the Securities Administrator are the
same Person, any removal of the Securities Administrator pursuant to
Section 6.06.
If an Event of Default described in clauses (i) through (ix) or (xi) of
this Section shall occur with respect to the Master Servicer, then, in each
and every case, subject to applicable law, so long as any such Event of
Default shall not have been remedied within any period of time prescribed by
this Section, the Trustee, by notice in writing to the Master Servicer may,
and, if so directed by (a) Certificateholders evidencing more than 50% of the
Class Principal Balance of each Class of Certificates or (b) the Depositor, in
the case of a failure related to a filing obligation triggered by a Reportable
Event; the Trustee shall by notice in writing to the Master Servicer (with a
copy to each Rating Agency and the Depositor), terminate all of the respective
rights and obligations of the Master Servicer hereunder and in and to the
Mortgage Loans and the proceeds thereof. Subject to Section 6.01(c)(ii), if an
Event of Default described in clause (x) of this Section shall occur with
respect to the Master Servicer, then, in each and every case, subject to
applicable law, so long as any such Event of Default shall not have been
remedied within any period of time prescribed by this Section, the Trustee
shall by notice in writing to the Master Servicer terminate all of the
respective rights and obligations of the Master Servicer hereunder 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, and with respect to the Master Servicer only in its capacity as
Master Servicer under this Agreement, whether with respect to the Mortgage
Loans or otherwise, shall pass to and be vested in the Trustee; and the
Trustee is hereby authorized and empowered to execute and deliver, on behalf
of the defaulting Master Servicer as attorney-in-fact or otherwise, any and
all documents and other instruments, and to do or accomplish all other acts or
things necessary or appropriate to effect the purposes of such notice of
termination, whether to complete the transfer and endorsement or assignment of
the affected Mortgage Loans and related documents or otherwise. The defaulting
Master Servicer agrees to cooperate with the Trustee and the Securities
Administrator in
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effecting the termination of the defaulting Master Servicer's responsibilities
and rights hereunder as Master Servicer which includes, without limitation,
notifying the Servicers of the assignment of the master servicing function and
providing the Trustee or its designee all documents and records in electronic
or other form reasonably requested by it to enable the Trustee or its designee
to assume the defaulting Master Servicer's functions hereunder and the
transfer to the Trustee for administration by it of all amounts which shall at
the time be or should have been deposited by the defaulting Master Servicer in
the Distribution Account, any related Custodial Account and any other account
or fund maintained with respect to the Certificates or thereafter received
with respect to the affected Mortgage Loans. The Master Servicer being
terminated shall bear all costs of the transfer of the master servicing to the
successor master servicer, including but not limited to those of the Trustee
or Securities Administrator reasonably allocable to specific employees and
overhead, legal fees and expenses, accounting and financial consulting fees
and expenses, and costs of amending the Agreement, if necessary. If such costs
are not paid by the terminated Master Servicer, the Trustee shall pay such
costs from the Trust Fund.
Notwithstanding the termination of its activities as Master Servicer,
any terminated Master Servicer shall continue to be entitled to reimbursement
under this Agreement to the extent such reimbursement relates to the period
prior to such Master Servicer's termination.
The Securities Administrator and the Master Servicer shall promptly
notify the Responsible Officers of the Trustee and the Depositor of the
occurrence and continuance of an Event of Default. If any Event of Default
shall occur, the Trustee, upon a Responsible Officer of the Trustee becoming
aware of the occurrence thereof, shall promptly notify each Rating Agency of
the nature and extent of such Event of Default. The Securities Administrator
shall immediately give written notice to the Master Servicer upon the failure
of the Master Servicer to make Advances as required under this Agreement with
a copy to the Trustee.
Upon the occurrence of an Event of Default, the Trustee shall provide
the Depositor in writing and in form and substance reasonably satisfactory to
the Depositor, all information reasonably requested by the Depositor in order
to comply with its reporting obligation under Item 6.02 of Form 8-K with
respect to a successor master servicer in the event the Trustee should succeed
to the duties of the Master Servicer as set forth herein.
In order to comply with applicable Form 8-K reporting requirements under
Regulation AB, at least 15 calendar days prior to the effective date of such
appointment, (x) the Trustee shall provide written notice to the Depositor of
such successor pursuant to this Section 6.14 and (y) such successor Master
Servicer shall provide to the Depositor in writing and in form and substance
reasonably satisfactory to the Depositor, all information reasonably requested
by the Depositor in order to comply with its reporting obligation under Item
6.02 of Form 8-K with respect to a replacement master servicer.
(b) On and after the time the Master Servicer receives a notice of
termination from the Trustee or the Securities Administrator, as applicable,
pursuant to Section 6.14(a) or the Trustee or the Securities Administrator, as
applicable, receives the resignation of the Master Servicer evidenced by an
Opinion of Counsel pursuant to Section 9.06, the Trustee, unless another
master servicer shall have been appointed, shall be the successor in all
respects to the Master Servicer, in its capacity as such under this Agreement
and the transactions set forth or
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provided for herein and shall have all the rights and powers and be subject to
all the responsibilities, duties and liabilities relating thereto and arising
thereafter placed on the Master Servicer, hereunder, including the obligation
to make Advances; provided, however, that any failure to perform such duties
or responsibilities caused by the failure of the Master Servicer to provide
information required by this Agreement shall not be considered a default by
the Trustee or the Securities Administrator, as applicable, hereunder. In
addition, neither the Trustee nor the Securities Administrator, as applicable,
shall have any responsibility for any act or omission of the Master Servicer
prior to the issuance of any notice of termination. The Trustee shall have no
liability relating to the representations and warranties of the Master
Servicer set forth in Section 9.03. In the capacity as such successor, the
Trustee shall have the same limitations on liability herein granted to the
Master Servicer. As compensation for being the successor master servicer, the
Trustee shall be entitled to receive all compensation payable to the Master
Servicer under this Agreement. Any successor to the Master Servicer hereunder
also may assume the obligations of the Securities Administrator hereunder as
successor in such capacity shall be entitled to the compensation payable to
the Securities Administrator pursuant to Section 4.02 hereof from and after
the date of such assumption.
(c) Notwithstanding the above, the Trustee may, if it shall be unwilling
to continue to so act, or shall, if it is unable to so act, 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 $15,000,000 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 respective responsibilities, duties
or liabilities of a master servicer, like the Master Servicer. Any entity
designated by the Trustee, may be an Affiliate of the Trustee; provided,
however, that, unless such Affiliate meets the net worth requirements and
other standards set forth herein for a successor master servicer, the Trustee,
in its individual capacity shall agree, at the time of such designation, to be
and remain liable to the Trust Fund for such Affiliate's actions and omissions
in performing its duties hereunder. In connection with such appointment and
assumption, the Trustee may make such arrangements for the compensation of
such successor out of payments on the Mortgage Loans as it and such successor
shall agree; provided, however, that no such compensation shall be in excess
of that permitted to the Master Servicer hereunder. The Trustee and such
successor shall take such actions, consistent with this Agreement, as shall be
necessary to effectuate any such succession and may make other arrangements
with respect to the master servicing to be conducted hereunder which are not
inconsistent herewith. The Master Servicer shall cooperate with the Trustee
and any successor master servicer in effecting the termination of the Master
Servicer's responsibilities and rights hereunder including, without
limitation, notifying the Servicers of the assignment of the master servicing
functions and providing the Trustee and successor master servicer all
documents and records in electronic or other form reasonably requested by it
to enable it to assume the Master Servicer's functions hereunder and the
transfer to the Trustee or such successor all amounts which shall at the time
be or should have been deposited by the Master Servicer in the Distribution
Account, any Custodial Account, or any other account or fund maintained with
respect to the Certificates or thereafter be received with respect to the
Mortgage Loans. Neither the Trustee nor the Securities Administrator, as
applicable, nor any other successor, as applicable, shall be deemed to be in
default hereunder by reason of any failure to make, or any delay in making,
any distribution hereunder or any portion thereof caused by (i) the failure of
the Master Servicer to deliver, or any delay in delivering,
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cash, documents or records to it, (ii) the failure of the Master Servicer to
cooperate as required by this Agreement, (iii) the failure of the Master
Servicer to deliver the related Mortgage Loan data as required by this
Agreement or (iv) restrictions imposed by any regulatory authority having
jurisdiction over the Master Servicer. No 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 caused by
(i) the failure of the Securities Administrator to deliver, or any delay in
delivering cash, documents or records to it related to such distribution, or
(ii) the failure of Trustee or the Securities Administrator to cooperate as
required by this Agreement.
Section 6.15. Additional Remedies of Trustee Upon Event of Default.
During the continuance of any Event of Default, so long as such Event of
Default shall not have been remedied, the Trustee, in addition to the rights
specified in Section 6.14, shall have the right, in its own name and as
trustee of the Trust Fund, to take all actions now or hereafter existing at
law, in equity or by statute to enforce its rights and remedies and to protect
the interests, and enforce the rights and remedies, of the Certificateholders
(including the institution and prosecution of all judicial, administrative and
other proceedings and the filings of proofs of claim and debt in connection
therewith). Except as otherwise expressly provided in this Agreement, no
remedy provided for by this Agreement shall be exclusive of any other remedy,
and each and every remedy shall be cumulative and in addition to any other
remedy, and no delay or omission to exercise any right or remedy shall impair
any such right or remedy or shall be deemed to be a waiver of any Event of
Default.
Section 6.16. Waiver of Defaults.
More than 50% of the Aggregate Voting Interests of the
Certificateholders may waive any default or Event of Default by the Master
Servicer in the performance of its obligations hereunder, except that a
default in the making of any required deposit to the Distribution Account that
would result in a failure of the Securities Administrator or the Paying Agent
to make any required payment of principal of or interest on the Certificates
may only be waived with the consent of 100% of the affected
Certificateholders. Upon any such waiver of a past default, such default shall
cease to exist, and any Event of Default arising therefrom shall be deemed to
have been remedied for every purpose of this Agreement. No such waiver shall
extend to any subsequent or other default or impair any right consequent
thereon except to the extent expressly so waived.
Section 6.17. Notification to Holders.
Upon termination of the Master Servicer or appointment of a successor to
the Master Servicer, in each case as provided herein, the Trustee shall
promptly mail notice thereof by first class mail to the Securities
Administrator and the Certificateholders at their respective addresses
appearing on the Certificate Register. The Trustee shall also, within 45 days
after the occurrence of any Event of Default known to the Trustee, give
written notice thereof to the Securities Administrator and the
Certificateholders, unless such Event of Default shall have been cured or
waived prior to the issuance of such notice and within such 45-day period.
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Section 6.18. Directions by Certificateholders and Duties of Trustee
During Event of Default.
Subject to the provisions of Section 8.01 hereof, during the continuance
of any Event of Default, Holders of Certificates evidencing not less than 25%
of the Class Principal Balance (or Percentage Interest) of each Class of
Certificates affected thereby may direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee, under this
Agreement; provided, however, that the Trustee shall be under no obligation to
pursue any such remedy, or to exercise any of the trusts or powers vested in
it by this Agreement (including, without limitation, (i) the conducting or
defending of any administrative action or litigation hereunder or in relation
hereto and (ii) the terminating of the Master Servicer or any successor master
servicer from its rights and duties as master servicer hereunder) at the
request, order or direction of any of the Certificateholders, unless such
Certificateholders shall have offered to the Trustee security or indemnity
reasonably satisfactory to it against the cost, expenses and liabilities which
may be incurred therein or thereby; and, provided further, that, subject to
the provisions of Section 8.01, the Trustee shall have the right to decline to
follow any such direction if the Trustee, in accordance with an Opinion of
Counsel, determines that the action or proceeding so directed may not lawfully
be taken or if the Trustee in good faith determines that the action or
proceeding so directed would involve it in personal liability for which it is
not indemnified to its satisfaction.
Section 6.19. Action Upon Certain Failures of the Master Servicer and
Upon Event of Default.
In the event that a Responsible Officer of the Trustee shall have actual
knowledge or written notice of any action or inaction of the Master Servicer
that would become an Event of Default upon the Master Servicer's failure to
remedy the same after notice, the Trustee shall give notice thereof to the
Master Servicer.
Section 6.20. Preparation of Tax Returns and Other Reports.
(a) The Securities Administrator shall prepare or cause to be prepared
on behalf of the Trust Fund, based upon information calculated in accordance
with this Agreement pursuant to instructions given by the Depositor, and the
Securities Administrator shall file federal tax returns, all in accordance
with Article X hereof. If the Securities Administrator is notified in writing
that a state tax return or other return is required, then, at the sole expense
of the Trust Fund, the Securities Administrator shall prepare and file such
state income tax returns and such other returns as may be required by
applicable law relating to the Trust Fund, and, if required by state law,
shall file any other documents to the extent required by applicable state tax
law (to the extent such documents are in the Securities Administrator's
possession). The Securities Administrator shall forward copies to the
Depositor of all such returns and Form 1099 supplemental tax information and
such other information within the control of the Securities Administrator as
the Depositor may reasonably request in writing, and shall forward to each
Certificateholder such forms and furnish such information within the control
of the Securities Administrator as are required by the Code and the REMIC
Provisions to be furnished to them, and will prepare and forward to
Certificateholders Form 1099 (supplemental tax information) (or otherwise
furnish information within the control of the Securities Administrator) to the
extent
Section 6.21. Certain Matters Regarding any Custodian Appointed Hereunder
(a) The Custodian shall maintain continuous custody of all items
constituting the Trustee Mortgage Files in secure facilities in accordance
with customary standards for such custody and shall reflect in its records the
interest of the Trustee for the benefit of the Certificateholders therein.
Each Mortgage Note (and Assignment of Mortgage) shall be maintained in fire
resistant facilities.
(b) With respect to the documents constituting each Trustee Mortgage File
relating to a Mortgage Loan listed on the Mortgage Loan Schedule, the
Custodian shall (i) act exclusively as the custodian for the Trustee, (ii)
hold all documents constituting such Trustee Mortgage File received by it for
the exclusive use and benefit of the Trust, and (iii) make disposition thereof
only in accordance with the terms of this Agreement.
(c) In the event that (i) the Trustee, a Servicer, the Securities
Administrator, the Master Servicer or the Custodian shall be served by a third
party with any type of levy, attachment, writ or court order with respect to
any Trustee Mortgage File or any document included within a Trustee Mortgage
File or (ii) a third party shall institute any court proceeding by which any
Trustee Mortgage File or a document included within a Trustee Mortgage File
shall be required to be delivered otherwise than in accordance with the
provisions of this Agreement, the party receiving such service shall promptly
deliver or cause to be delivered to the other parties to this Agreement copies
of all court papers, orders, documents and other materials concerning such
proceedings. The Custodian shall, to the extent permitted by law, continue to
hold and maintain all the Trustee Mortgage Files that are the subject of such
proceedings pending a final, nonappealable order of a court of competent
jurisdiction permitting or directing disposition thereof. Upon final
determination of such court, the Custodian shall dispose of such Trustee
Mortgage File or any document included within such Trustee Mortgage File as
directed by the Trustee which shall give a direction consistent with such
determination. Expenses and fees (including reasonable attorney's fees) of the
Custodian incurred as a result of such proceedings shall be borne by the Trust
Fund.
(d) The Custodian shall provide access to the Mortgage Loan Documents in
its possession regarding the related Mortgage Loans and REO Property and the
servicing thereof to the Trustee, the Master Servicer, the Securities
Administrator, the related Servicer, 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 Custodian. The Custodian shall allow representatives of the
above entities to photocopy any of the records and documentation and shall
provide equipment for that purpose at the expense of the person requesting
such access.
(e) The Custodian shall have no duties or responsibilities except those
that are specifically set forth herein, or as subsequently agreed in writing
by the parties hereto, and no implied covenants or obligations shall be read
into this Agreement against the Custodian.
(f) The Custodian shall have no responsibility nor duty with respect to
any Trustee Mortgage Files while not in its possession.
(g) The Custodian shall be under no obligation to make any investigation
into the facts or matters stated in any resolution, exhibit, request,
representation, opinion, certificate, statement, acknowledgement, consent,
order or document in the Trustee Mortgage File.
(h) If the Trustee and a Custodian are the same Person, any removal or
resignation of that Person in either capacity shall also result in the removal
of the Person in its other capacity.
(i) In the event that the Custodian fails to produce a Mortgage Note,
Assignment of Mortgage or any other document related to a Mortgage Loan that
was in its possession pursuant to Section 2.01 within five (5) Business Days
after required or requested by the Depositor, the Trustee, the Master Servicer
or the related Servicer, and provided, that (i) Custodian previously delivered
to the Trustee an Initial Certification or a Final Certification with respect
to such document; (ii) such document is not outstanding pursuant to a Request
for Release; and (iii) such document was held by the Custodian on behalf of
the Trustee (a "Custodial Delivery Failure"), then the Custodian shall (a)
with respect to any missing Mortgage Note, promptly deliver to the Depositor,
the Trustee, the Master Servicer or the Servicer upon request, a Lost Note
Affidavit in the form of Exhibit R annexed hereto and (b) with respect to any
missing document related to such Mortgage Loan including but not limited to, a
missing Mortgage Note, indemnify the Depositor, Trustee, the Master Servicer
or the Servicer in accordance with the succeeding paragraph of this Section
6.21(i).
The Custodian appointed hereunder agrees to indemnify and hold the
Depositor, the Trustee, the Master Servicer and the Servicer and their
respective employees, officers, directors and agents harmless against any and
all direct liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements, including reasonable
attorney's fees, that may be imposed on, incurred by, or asserted against it
or them in any way relating to or arising out of such Custodial Delivery
Failure. The foregoing indemnification shall survive any termination or
assignment of this Agreement or the removal or resignation of the Custodian
hereunder.
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required by applicable law. The Master Servicer will indemnify the Securities
Administrator and the Trustee for any liability of or assessment against the
Securities Administrator or the Trustee, as applicable, resulting from any
error in any of such tax or information returns directly resulting from errors
in the information provided by such Master Servicer except to the extent that
such information was provided in reasonable reliance upon information from any
Servicer.
For the avoidance of doubt, if the entity serving as Trustee is also
serving as a Custodian, such entity in its capacity as Custodian shall have
the same rights, protections and indemnities as are afforded to the Trustee
hereunder provided that such Custodian shall not be indemnified by the Trust
Fund for any liability, obligation, loss, damage, penalty, action, judgment,
suit, cost, expense or disbursement imposed on, incurred by or asserted
against the Custodian because of the breach by the Custodian of its
obligations hereunder, which breach was caused by negligence, lack of good
faith or willful misconduct on the part of the Custodian or any of its
directors, officers, agents or employees.
ARTICLE VII
PURCHASE OF MORTGAGE LOANS AND
TERMINATION OF THE TRUST FUND
Section 7.01. Purchase of Mortgage Loans; Termination of Trust Fund Upon
Purchase or Liquidation of All Mortgage Loans.
(a) The respective obligations and responsibilities of the Trustee, the
Securities Administrator and the Master Servicer created hereby (other than
the obligation of the Securities Administrator to make payments to the
Certificateholders as set forth in Section 7.02), shall terminate on the
earliest of (i) the final payment or other liquidation of the last Mortgage
Loan remaining in the Trust Fund and the disposition of all REO Property, (ii)
the sale or auction of the property held by the Trust Fund in accordance with
both (x) Section 7.01(b) or 7.01(c) and (iii) the Latest Possible Maturity
Date; provided, however, that in no event shall the Trust Fund created hereby
continue beyond the expiration of 21 years from the death of the last survivor
of the descendants of Xxxxxx X. Xxxxxxx, the late Ambassador of the United
States to the Court of St. James's, living on the date hereof. Any termination
of the Trust Fund shall be carried out in such a manner so that the
termination of each REMIC included therein shall qualify as a "qualified
liquidation" under the REMIC Provisions.
(b) On the Initial Optional Termination date, the Auction Administrator
shall solicit bids for the Assets from at least three institutions that are
regular purchasers and/or sellers in the secondary market of residential whole
mortgage loans similar to the Mortgage Loans. If the Auction Administrator
receives at least three bids for the Assets, and one of such bids is equal to
or greater than the Minimum Auction Price, the Auction Administrator shall
sell (such sale, an "Auction") the related Assets to the highest bidder (the
"Auction Purchaser") at the price offered by the Auction Purchaser (the
"Mortgage Loan Auction Price"). If the Auction Administrator receives less
than three bids, or does not receive any bid that is at least equal to the
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Minimum Auction Price, the Auction Administrator shall, on each six-month
anniversary of the Initial Optional Termination Date for the Mortgage Loans,
repeat these auction procedures until the Auction Administrator receives a bid
that is at least equal to the Minimum Auction Price, at which time the Auction
Administrator shall sell the Assets to the Auction Purchaser at that Mortgage
Loan Auction Price; provided, however, that the Auction Administrator shall
not be required to repeat these auction procedures on any Distribution Date
for any six-month anniversary of the Initial Optional Termination Date unless
the Auction Administrator reasonably believes that there is a reasonable
likelihood of receiving a bid of at least the Minimum Auction Price. The
Auction Administrator shall give notice to the Rating Agencies and each
Servicer that is servicing any of the Mortgage Loans of the sale of the
related Assets pursuant to this Section 7.01(b) (an "Auction Sale") and of the
Auction Date.
(c) In the event that the Master Servicer chooses to exercise its
optional termination rights it shall do so in accordance with the following:
(i) On any Distribution Date occurring after the Initial Optional
Termination Date related to the Mortgage Loans, the Master Servicer has
the option to cause the Trust Fund to adopt a plan of complete
liquidation of the Mortgage Loans pursuant to Sections 7.02 and 7.03
hereof to sell all of the property related thereto. If the Master
Servicer elects to exercise such option, it shall no later than 30 days
prior to the Distribution Date selected for purchase of the Mortgage
Loans and all other assets of the Trust Fund related to the Certificates
(with respect to the Certificates, the "Purchase Date") deliver written
notice to the Trustee and the Securities Administrator and either (a)
deposit in the Distribution Account the related Redemption Price or (b)
state in such notice that the Redemption Price shall be deposited in the
Distribution Account not later than 10:00 a.m., New York City time, on
the applicable Purchase Date. Upon exercise of such option, the Assets
shall be sold to the Master Servicer at a price equal to the related
Redemption Price.
(d) The Depositor, the Master Servicer, each Servicer, the Securities
Administrator, the Trustee and the Custodian shall be reimbursed from the
Redemption Price for any Advances, Servicer Advances, accrued and unpaid
Servicing Fees or other amounts with respect to the Mortgage Loans and any
related assets being purchased pursuant to Section 7.01(b) or (c) above that
are reimbursable to such parties (and such other amounts which, if not related
to the Mortgage Loans and other assets of the Trust Fund not being purchased,
that are then due and owing to any such Person) under this Agreement and the
related Purchase and Servicing Agreement or the related Custodial Agreement.
Section 7.02. Procedure Upon Redemption of Trust Fund.
(a) Notice of any termination pursuant to the provisions of Section
7.01, specifying the Distribution Date upon which the final distribution shall
be made or the purchase of the Trust's assets, as applicable, will occur,
shall be given promptly by the Securities Administrator by first class mail to
the Certificateholders mailed in the case of a redemption of the Certificates,
no later than (i) the first day of the month in which the Distribution Date
selected for redemption of such Certificates shall occur or (ii) upon (x) the
sale of all of the property of the Trust Fund by the Securities Administrator
or in the case of a sale of assets of the
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Trust Fund, or (y) upon the final payment or other liquidation of the last
Mortgage Loan or REO Property in the Trust Fund. Such notice shall specify (A)
the Initial Optional Termination Date, Distribution Date upon which final
distribution on the Certificates of all amounts required to be distributed to
Certificateholders pursuant to Section 5.02 will be made upon presentation and
surrender of the Certificates at the Certificate Registrar's Corporate Trust
Office, and (B) that the Record Date otherwise applicable to such Distribution
Date is not applicable, distribution being made only upon presentation and
surrender of the Certificates at the office or agency of the Securities
Administrator therein specified. The Securities Administrator shall give such
notice to the Trustee, the Master Servicer and the Certificate Registrar at
the time such notice is given to Holders of the Certificates. Upon any such
termination, the duties of the Certificate Registrar with respect to the
affected Certificates shall terminate and, in the event that such termination
is the second termination pursuant to Section 7.01, the Securities
Administrator shall terminate the Distribution Account and any other account
or fund maintained with respect to the Certificates, subject to the Securities
Administrator's obligation hereunder to hold all amounts payable to
Certificateholders in trust without interest pending such payment.
(b) In the event that all of the Holders do not surrender their
Certificates for cancellation within three months after the time specified in
the above-mentioned written notice, the Securities Administrator shall give a
second written notice to the remaining Certificateholders to surrender their
Certificates for cancellation and receive the final distribution with respect
thereto. If within one year after the second notice any Certificates shall not
have been surrendered for cancellation, the Securities Administrator may take
appropriate steps to contact the remaining Certificateholders concerning
surrender of such Certificates, and the cost thereof shall be paid out of the
amounts distributable to such Holders. If within two years after the second
notice any Certificates shall not have been surrendered for cancellation, the
Securities Administrator shall deliver any remaining funds being held by it to
the Holder of the Class A-R Certificates and the Holder of the Class A-R
Certificates shall, subject to applicable state law relating to escheatment,
hold all amounts distributable to such Holders for the benefit of such
Holders. No interest shall accrue on any amount held by the Securities
Administrator and not distributed to a Certificateholder due to such
Certificateholder's failure to surrender its Certificate(s) for payment of the
final distribution thereon in accordance with this Section. The foregoing
provisions are intended to distribute to each Class of Certificates any
accrued and unpaid interest and/or principal to which they are entitled based
on their Pass-Through Rates and Class Certificate Balances set forth in the
Preliminary Statement upon liquidation of the Trust Fund.
(c) Any reasonable expenses incurred by the Securities Administrator in
connection with any purchase or termination or liquidation of the Trust Fund
shall be reimbursed from proceeds received from the liquidation of the Trust
Fund.
(d) Any purchase of the Assets by the related Auction Purchaser shall be
made on an Auction Date by receipt of the Auction Administrator of the related
Mortgage Loan Auction Price from the Auction Purchaser, and deposit of the
such Mortgage Loan Auction Price into the Distribution Account by the Auction
Administrator before the Distribution Date on which such purchase is effected.
Upon deposit of such purchase price into the Distribution Account, the Trustee
and the Securities Administrator, shall, upon request and at the expense of
the Auction Purchaser, execute and deliver all such instruments of transfer or
assignment, in each case
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without recourse, as shall be reasonably requested by the Auction Purchaser to
vest title in the Auction Purchaser in the Assets so purchased and shall
transfer or deliver to the Auction Purchaser the purchased Assets.
Section 7.03. Additional Trust Fund Termination Requirements.
(a) On the termination of the Trust Fund under Section 7.01 (a), upon an
Auction Sale pursuant to Section 7.01(b) or upon the exercise of the right to
purchase all of the Mortgage Loans pursuant to Section 7.01(c), the Securities
Administrator, on behalf of the Trustee, shall comply with requirements of
this Section 7.03 with respect to each Lower Tier REMIC relating to the assets
to be sold (the "Affected REMIC") and with respect to the Certificates
corresponding to the Affected REMIC (the "Corresponding Certificates"), unless
the party having the right to purchase the assets of the Affected REMIC (the
"Purchaser") delivers to the Trustee and the Securities Administrator, an
Opinion of Counsel (at the Master Servicer's expense), addressed to the
Trustee and the Securities Administrator to the effect that the failure of the
Trustee and the Securities Administrator to comply with the requirements of
this Section 7.03 will not result in an Adverse REMIC Event:
(i) Within 89 days prior to the time of making the final payment on
the Corresponding Certificates, (and upon notification by (1) the Auction
Administrator in the case of a purchase under Section 7.01(b) or (2) the
Master Servicer in the case of a purchase under Section 7.01(c)(i) or
Section 7.01(c)(ii), as applicable) the Securities Administrator on
behalf of the Trustee shall adopt on behalf of the Affected REMIC, a plan
of complete liquidation, meeting the requirements of a qualified
liquidation under the REMIC Provisions;
(ii) Any sale of the assets of the Affected REMIC shall be for cash
and shall occur at or after the time the plan of complete liquidation is
adopted and prior to the time the final payments on the Corresponding
Certificates are made;
(iii) On the date specified for final payment of the Corresponding
Certificates, the Securities Administrator shall make final distributions
of principal and interest on the Corresponding Certificates in accordance
with Section 5.02 and, after payment of, or provision for any outstanding
expenses, distribute or credit, or cause to be distributed or credited,
to the Holders of the Residual Certificates all cash on hand after such
final payment (other than cash retained to meet claims), and the portion
of the Trust Fund (and the Affected REMIC) shall terminate at that time;
and
(iv) In no event may the final payment on the Corresponding
Certificates or the final distribution or credit to the Holders of the
Residual Certificates be made after the 89th day from the date on which
the plan of complete liquidation is adopted.
(b) By its acceptance of a Residual Certificate, each Holder thereof
hereby agrees to accept the plan of complete liquidation adopted by the
Securities Administrator on behalf of the Trustee under this Section and to
take such other action in connection therewith as may be reasonably requested
by the Trustee, the Securities Administrator or any Servicer.
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ARTICLE VIII
RIGHTS OF CERTIFICATEHOLDERS
Section 8.01. Limitation on Rights of Holders.
(a) The death or incapacity of any Certificateholder shall not operate
to terminate this Agreement or this Trust Fund, nor entitle such
Certificateholder's legal representatives or heirs to claim an accounting or
take any action or proceeding in any court for a partition or winding up of
this Trust Fund, nor otherwise affect the rights, obligations and liabilities
of the parties hereto or any of them. Except as otherwise expressly provided
herein, no Certificateholder, solely by virtue of its status as a
Certificateholder, shall have any right to vote or in any manner otherwise
control the Master Servicer or the operation and management of the Trust Fund,
or the obligations of the parties hereto, nor shall anything herein set forth,
or contained in the terms of the Certificates, be construed so as to
constitute the Certificateholders from time to time as partners or members of
an association, nor shall any Certificateholder be under any liability to any
third person by reason of any action taken by the parties to this Agreement
pursuant to any provision hereof.
(b) No Certificateholder, solely by virtue of its status as
Certificateholder, shall have any right by virtue or by availing of any
provision of this Agreement to institute any suit, action or proceeding in
equity or at law upon or under or with respect to this Agreement, unless such
Holder previously shall have given to the Trustee a written notice of an Event
of Default and of the continuance thereof, as hereinbefore provided, and
unless also the Holders of Certificates evidencing not less than 25% of the
Class Principal Amount of Certificates of each Class affected thereby shall
have made written request upon the Trustee to institute such action, suit or
proceeding in its own name as Trustee hereunder and shall have offered to the
Trustee such reasonable indemnity as it may require against the cost, expenses
and liabilities to be incurred therein or thereby, and the Trustee, for sixty
days after its receipt of such notice, request and offer of indemnity, shall
have neglected or refused to institute any such action, suit or proceeding and
no direction inconsistent with such written request has been given such
Trustee during such sixty-day period by such Certificateholders; it being
understood and intended, and being expressly covenanted by each
Certificateholder with every other Certificateholder, the Securities
Administrator and the Trustee, that no one or more Holders of Certificates
shall have any right in any manner whatever by virtue or by availing of any
provision of this Agreement to affect, disturb or prejudice the rights of the
Holders of any other of such Certificates, or to obtain or seek to obtain
priority over or preference to any other such Holder, or to enforce any right
under this Agreement, except in the manner herein provided and for the benefit
of all Certificateholders. For the protection and enforcement of the
provisions of this Section, each and every Certificateholder and the Trustee
shall be entitled to such relief as can be given either at law or in equity.
Section 8.02. Access to List of Holders.
(a) If the Trustee is not acting as Certificate Registrar, the
Certificate Registrar will furnish or cause to be furnished to the Trustee,
within fifteen days after receipt by the Certificate Registrar of a request by
the Trustee in writing, a list, in such form as the Trustee may
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reasonably require, of the names and addresses of the Certificateholders of
each Class as of the most recent Record Date.
(b) If three or more Holders or Certificate Owners (hereinafter referred
to as "Applicants") apply in writing to the Certificate Registrar, and such
application states that the Applicants desire to communicate with other
Holders with respect to their rights under this Agreement or under the
Certificates and is accompanied by a copy of the communication which such
Applicants propose to transmit, then the Certificate Registrar shall, within
five Business Days after the receipt of such application, afford such
Applicants reasonable access during the normal business hours of the
Certificate Registrar to the most recent list of Certificateholders held by
the Certificate Registrar or shall, as an alternative, send, at the
Applicants' expense, the written communication proffered by the Applicants to
all Certificateholders at their addresses as they appear in the Certificate
Register.
(c) Every Holder or Certificate Owner, if the Holder is a Clearing
Agency, by receiving and holding a Certificate, agrees with the Depositor, the
Master Servicer, the Securities Administrator, the Certificate Registrar and
the Trustee that none of the Depositor, the Master Servicer, the Securities
Administrator, the Certificate Registrar nor the Trustee shall be held
accountable by reason of the disclosure of any such information as to the
names and addresses of the Certificateholders hereunder, regardless of the
source from which such information was derived.
Section 8.03. Acts of Holders of Certificates.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Agreement to be given or taken by
Holders or Certificate Owners, if the Holder is a Clearing Agency, may be
embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such Holders in person or by agent duly appointed in writing;
and, except as herein otherwise expressly provided, such action shall become
effective when such instrument or instruments are delivered to the Trustee and
the Securities Administrator and, where expressly required herein, to the
Master Servicer. Such instrument or instruments (as the action embodies
therein and evidenced thereby) are herein sometimes referred to as an "Act" of
the Holders signing such instrument or instruments. Proof of execution of any
such instrument or of a writing appointing any such agents shall be sufficient
for any purpose of this Agreement and conclusive in favor of the Trustee, the
Securities Administrator and the Master Servicer, if made in the manner
provided in this Section. Each of the Trustee, the Securities Administrator
and the Master Servicer shall promptly notify the others of receipt of any
such instrument by it, and shall promptly forward a copy of such instrument to
the others.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by the certificate of any notary public or other officer
authorized by law to take acknowledgments or deeds, certifying that the
individual signing such instrument or writing acknowledged to him the
execution thereof. Whenever such execution is by an officer of a corporation
or a member of a partnership on behalf of such corporation or partnership,
such certificate or affidavit shall also constitute sufficient proof of his
authority. The fact and date of the execution of any such instrument or
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writing, or the authority of the individual executing the same, may also be
proved in any other manner which the Trustee deems sufficient.
(c) The ownership of Certificates (whether or not such Certificates
shall be overdue and notwithstanding any notation of ownership or other
writing thereon made by anyone other than the Trustee) shall be proved by the
Certificate Register, and none of the Trustee, the Securities Administrator,
the Master Servicer or the Depositor shall be affected by any notice to the
contrary.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other action by the Holder of any Certificate shall bind every
future Holder of the same Certificate and the Holder of every Certificate
issued upon the registration of transfer thereof or in exchange therefor or in
lieu thereof, in respect of anything done, omitted or suffered to be done by
the Trustee or the Master Servicer in reliance thereon, whether or not
notation of such action is made upon such Certificate.
ARTICLE IX
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
BY THE MASTER SERVICER
Section 9.01. Duties of the Master Servicer; Enforcement of Servicers'
and Master Servicer's Obligations.
(a) The Master Servicer, on behalf of the Trustee, the Depositor and the
Certificateholders shall monitor the performance of the Servicers under the
Purchase and Servicing Agreements, and shall use its reasonable good faith
efforts to cause the Servicers duly and punctually to perform all of their
respective duties and obligations thereunder. Upon the occurrence of a default
of which a Responsible Officer of the Master Servicer has actual knowledge
under a Purchase and Servicing Agreement, the Master Servicer shall promptly
notify the Trustee thereof, and shall specify in such notice the action, if
any, the Master Servicer is taking in respect of such default. So long as any
such default shall be continuing, the Master Servicer may, and shall if it
determines such action to be in the best interests of Certificateholders, (i)
terminate all of the rights and powers of such Servicer pursuant to the
applicable provisions of the related Purchase and Servicing Agreement; (ii)
exercise any rights it may have to enforce the related Purchase and Servicing
Agreement against such Servicer; and/or (iii) waive any such default under the
related Purchase and Servicing Agreement or take any other action with respect
to such default as is permitted thereunder. Notwithstanding anything to the
contrary in this Agreement, with respect to any Additional Collateral Mortgage
Loan, the Master Servicer will have no duty or obligation to supervise,
monitor or oversee the activities of the related Servicer under any Purchase
and Servicing Agreement with respect to any Additional Collateral or under any
agreement relating to the pledge of, or the perfection of a pledge or security
interest in, any Additional Collateral except upon the occurrence of the
following events (i) in the case of a final liquidation of any Mortgaged
Property secured by Additional Collateral, the Master Servicer shall enforce
the obligation of the Servicer under the related Servicing Agreement to
liquidate such Additional Collateral as required by such Servicing Agreement,
and (ii) if the Master Servicer assumes the obligations of such Servicer as
successor Servicer under
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the related Servicing Agreement pursuant to this Section 9.01, as successor
Servicer, it shall be bound to service and administer the Additional
Collateral in accordance with the provisions of such Servicing Agreement.
(b) Upon any termination by the Master Servicer of a Servicer's rights
and powers pursuant to its Purchase and Servicing Agreement, the rights and
powers of such Servicer with respect to the related Mortgage Loans shall vest
in the Master Servicer and the Master Servicer shall be the successor in all
respects to such Servicer in its capacity as Servicer with respect to such
Mortgage Loans under the related Purchase and Servicing Agreement, unless or
until the Master Servicer shall have appointed (and the Trustee shall have
acknowledged), with the consent of the Rating Agencies and in accordance with
the applicable provisions of the related Purchase and Servicing Agreement, a
new Xxxxxx Xxx- or FHLMC-approved Person to serve as successor to the
Servicer; provided, however, that it is understood and agreed by the parties
hereto that there will be a period of transition (not to exceed 90 days)
before the actual servicing functions can be fully transferred to a successor
servicer (including the Master Servicer). With such letter from the Rating
Agencies, the Master Servicer may elect to continue to serve as successor
servicer under the Purchase and Servicing Agreement. Upon appointment of a
successor servicer, as authorized under this Section 9.01(b), unless the
successor servicer shall have assumed the obligations of the terminated
Servicer under such Purchase and Servicing Agreement, the Master Servicer and
such successor servicer shall enter into a servicing agreement in a form
substantially similar to the affected Purchase and Servicing Agreement, and
the Trustee shall acknowledge such servicing agreement. In connection with any
such appointment, the Master Servicer may make such arrangements for the
compensation of such successor servicer as it and such successor servicer
shall agree, but in no event shall such compensation of any successor servicer
(including the Master Servicer) be in excess of that payable to the Servicer
under the affected Purchase and Servicing Agreement.
The Master Servicer shall pay the costs of such enforcement (including
the termination of a Servicer, the appointment of a successor servicer or the
transfer and assumption of the servicing by the Master Servicer) at its own
expense and shall be reimbursed therefor initially (i) by the terminated
Servicer, (ii) from a general recovery resulting from such enforcement only to
the extent, if any, that such recovery exceeds all amounts due in respect of
the related Mortgage Loans, (iii) from a specific recovery of costs, expenses
or attorney's fees against the party against whom such enforcement is
directed, or (iv) to the extent that such amounts described in (i)-(iii) above
are insufficient to reimburse the Master Servicer for such costs of
enforcement, from the Trust Fund, as provided in Section 9.04.
If the Master Servicer assumes the servicing with respect to any of the
Mortgage Loans, it will not assume liability for the representations and
warranties of any Servicer it replaces or for the errors or omissions of such
Servicer.
If the Seller is the owner of the servicing rights and the Seller
chooses to terminate that Servicer with or without cause and sell those
servicing rights to a successor servicer, then the Depositor shall (i) cause
the Seller to give reasonable prior written notice to the Master Servicer, and
(ii) obtain a letter from the Rating Agencies indicating that the appointment
of the proposed successor servicer will not result in a downgrade or
withdrawal of the rating of any of the Certificates, and a New Xxxxxx Xxx- or
FHLMC-approved Person reasonably acceptable to the
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Master Servicer shall be chosen by the Seller and appointed as successor
servicer with the acknowledgment of the Master Servicer and the Trustee;
provided, however, that the Seller shall not be required to get a no-downgrade
letter from the Rating Agencies if: (i) the Rating Agencies received prior
written notice of the transfer of the servicing rights and the name of the
successor Servicer, (ii) such successor Servicer has a servicing rating in the
highest category of Fitch or Xxxxx'x to the extent that Fitch or Xxxxx'x,
respectively, is a Rating Agency, and such successor Servicer has a servicer
evaluation ranking in one of the two highest categories of S&P to the extent
that S&P is a Rating Agency, and (iii) such successor Servicer shall service
the related Mortgage Loans under either the Purchase and Servicing Agreement
together with the related Assignment Agreement under which such Mortgage Loans
are currently being serviced or under another Servicing Agreement together
with a related Assignment Agreement that have already been reviewed and
approved by the Rating Agencies. The Depositor shall cause the costs of such
transfer including any costs of such transfer (including any costs of the
Master Servicer) to be borne by the Seller.
At least 15 calendar days prior to the effective date of such
termination, (x) the Depositor shall provide written notice to the Master
Servicer and all information reasonably requested by the Depositor in order to
comply with its reporting obligation under Item 6.02 of Form 8-K with respect
to a replacement servicer.
(c) Upon any termination of a Servicer's rights and powers pursuant to
its Purchase and Servicing Agreement, the Master Servicer shall promptly
notify the Trustee and the Rating Agencies, specifying in such notice that the
Master Servicer or any successor servicer, as the case may be, has succeeded
such Servicer under the related Purchase and Servicing Agreement or under any
other servicing agreement reasonably satisfactory to the Master Servicer and
the Rating Agencies, which notice shall also specify the name and address of
any such successor servicer.
(d) The Depositor shall not consent to the assignment by any Servicer of
such Servicer's rights and obligations under the related Purchase and
Servicing Agreement without the prior written consent of the Master Servicer,
which consent shall not be unreasonably withheld.
(e) The Trustee shall execute and deliver, at the written request of the
Master Servicer or any Servicer, and furnish to the Master Servicer and any
Servicer, at the expense of the requesting party, a power of attorney in the
standard form provided by the Trustee to take title to the Mortgaged
Properties after foreclosure in the name of and on behalf of the Trustee in
its capacity as Trustee hereunder and for the purposes described herein to the
extent necessary or desirable to enable the Master Servicer or any Servicer to
perform its respective duties. The Trustee shall not be liable for the actions
of the Master Servicer or any Servicer under such powers of attorney.
Section 9.02. Assumption of Master Servicing by Trustee.
(a) In the event the Master Servicer shall for any reason no longer be
the Master Servicer (including by reason of any Event of Default by the Master
Servicer under this Agreement), the Trustee shall thereupon assume all of the
rights and obligations of such Master
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Servicer hereunder and under each Purchase and Servicing Agreement entered
into with respect to the Mortgage Loans or shall appoint or petition a court
to appoint a Xxxxxx-Xxx or FHLMC-approved servicer as successor servicer that
is acceptable to the Depositor and the Rating Agencies. The Trustee, as
successor master servicer, its designee or any successor master servicer
appointed by the Trustee shall be deemed to have assumed all of the Master
Servicer's interest herein and therein to the same extent as if such Purchase
and Servicing Agreements had been assigned to the assuming party, except that
the Master Servicer shall not thereby be relieved of any liability or
obligations of the Master Servicer under such Purchase and Servicing Agreement
accruing prior to its replacement as Master Servicer, and shall be liable to
the Trustee, and hereby agrees to indemnify and hold harmless the Trustee (in
its individual corporate capacity and as Trustee hereunder) from and against
all costs, damages, expenses and liabilities (including reasonable attorneys'
fees) incurred by the Trustee as a result of such liability or obligations of
the Master Servicer and in connection with the Trustee's assumption (but not
its performance, except to the extent that costs or liability of the Trustee
are created or increased as a result of negligent or wrongful acts or
omissions of the Master Servicer prior to its replacement as Master Servicer)
of the Master Servicer's obligations, duties or responsibilities thereunder.
To the extent that the costs and expenses of the Trustee described in this
Section are not timely reimbursed by the Master Servicer, the Trustee shall be
entitled to reimbursement from the Distribution Account and the Master
Servicer is hereby obligated to reimburse the Trust promptly for such amounts
by deposit thereof in the Distribution Account.
(b) The Master Servicer that has been terminated shall, upon request of
the Trustee but at the expense of such Master Servicer, deliver to the
assuming party all documents and records relating to each Purchase and
Servicing Agreement, this Agreement and the related Mortgage Loans and an
accounting of amounts collected and held by it and otherwise use its best
efforts to effect the orderly and efficient transfer of each Purchase and
Servicing Agreement and this Agreement to the assuming party.
Section 9.03. Representations and Warranties of the Master Servicer.
The Master Servicer hereby represents and warrants to the Depositor, the
Securities Administrator and the Trustee, for the benefit of the
Certificateholders, as of the Closing Date that:
(i) it is validly existing and in good standing under the laws of
the United States of America as a national banking association, and as
Master Servicer has full power and authority to transact any and all
business contemplated by this Agreement and to execute, deliver and
comply with its obligations under the terms of this Agreement, the
execution, delivery and performance of which have been duly authorized by
all necessary corporate action on the part of the Master Servicer;
(ii) the execution and delivery of this Agreement by the Master
Servicer and its performance and compliance with the terms of this
Agreement will not (A) violate the Master Servicer's charter or bylaws,
(B) violate any law or regulation or any administrative decree or order
to which it is subject or (C) 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 contract, agreement or other
instrument to which the
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Master Servicer is a party or by which it is bound or to which any of its
assets are subject, which violation, default or breach would materially
and adversely affect the Master Servicer's ability to perform its
obligations under this Agreement;
(iii) this Agreement constitutes, assuming due authorization,
execution and delivery hereof by the other respective parties hereto, a
legal, valid and binding obligation of the Master Servicer, enforceable
against it in accordance with the terms hereof, except as such
enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium and other laws affecting the enforcement of creditors' rights
in general, and by general equity principles (regardless of whether such
enforcement is considered in a proceeding in equity or at law);
(iv) the Master Servicer is not in default with respect to any order
or decree of any court or any order or regulation of any federal, state,
municipal or governmental agency to the extent that any such default
would materially and adversely affect its performance hereunder;
(v) the Master Servicer is not a party to or bound by any agreement
or instrument or subject to any charter provision, bylaw or any other
corporate restriction or any judgment, order, writ, injunction, decree,
law or regulation that may materially and adversely affect its ability as
Master Servicer to perform its obligations under this Agreement or that
requires the consent of any third person to the execution of this
Agreement or the performance by the Master Servicer of its obligations
under this Agreement;
(vi) no litigation is pending or, to the best of the Master
Servicer's knowledge, threatened against the Master Servicer which would
prohibit its entering into this Agreement or performing its obligations
under this Agreement;
(vii) the Master Servicer, or an affiliate thereof the primary
business of which is the servicing of conventional residential mortgage
loans, is a Xxxxxx Mae- or FHLMC-approved seller/servicer;
(viii) no consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by the Master Servicer of or compliance by the Master
Servicer with this Agreement or the consummation of the transactions
contemplated by this Agreement, except for such consents, approvals,
authorizations and orders (if any) as have been obtained; and
(ix) the consummation of the transactions contemplated by this
Agreement are in the ordinary course of business of the Master Servicer.
It is understood and agreed that the representations and warranties set
forth in this Section shall survive the execution and delivery of this
Agreement. The Master Servicer shall indemnify the Depositor, the Securities
Administrator and the Trustee and hold them harmless against any loss,
damages, penalties, fines, forfeitures, legal fees and related costs,
judgments, and other costs and expenses resulting from any claim, demand,
defense or assertion based on or grounded upon, or resulting from, a material
breach of the Master Servicer's representations and warranties
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contained in this Section 9.03. It is understood and agreed that the
enforcement of the obligation of the Master Servicer set forth in this Section
to indemnify the Depositor, the Securities Administrator and the Trustee as
provided in this Section constitutes the sole remedy (other than as set forth
in Section 6.14) of the Depositor, the Securities Administrator and the
Trustee, respecting a breach of the foregoing representations and warranties.
Such indemnification shall survive any termination of the Master Servicer as
Master Servicer hereunder, the resignation or removal of the Trustee and any
termination of this Agreement.
Any cause of action against the Master Servicer relating to or arising
out of the breach of any representations and warranties made in this Section
shall accrue upon discovery of such breach by either the Depositor, the Master
Servicer or the Trustee or notice thereof by any one of such parties to the
other parties.
Section 9.04. Compensation to the Master Servicer.
The Master Servicer shall be compensated for its duties hereunder
pursuant to Section 4.02(b) hereof. The Master Servicer shall either retain or
withdraw from the Distribution Account (i) amounts necessary to reimburse
itself for any previously unreimbursed Advances, Servicer Advances and
Nonrecoverable Advances with respect to the Mortgage Loans in accordance with
the definition of "Available Distribution Amount" and (ii) amounts
representing assumption fees, late payment charges or other ancillary income
not included in the definition of "Available Distribution Amount" and which
are not required to be remitted by the Servicers to the Securities
Administrator or deposited by the Securities Administrator into the
Distribution Account and (iii) any amounts to which the Master Servicer is
entitled pursuant to 4.01(e) hereof. 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.
In addition, the Master Servicer shall be entitled to reimbursement from
the Distribution Account for all reasonable expenses, disbursements and
advances incurred or made by the Master Servicer in connection with the
performance of its duties hereunder and under the Purchase and Servicing
Agreements, as modified by the Acknowledgements (including the reasonable
compensation and the expenses and disbursements of its agents and counsel), to
the extent not otherwise reimbursed pursuant to this Agreement, except any
such expense, disbursement or advance as may be attributable to its willful
misfeasance, bad faith or negligence.
The Master Servicer and any director, officer, employee or agent of the
Master Servicer shall be indemnified by the Trust and held harmless thereby
against any loss, liability or expense (including reasonable legal fees and
disbursements of counsel) incurred on their part that may be sustained in
connection with, arising out of, or related to, any claim or legal action
(including any pending or threatened claim or legal action) relating to this
Agreement, the Purchase and Servicing Agreements or the Certificates, other
than any loss, liability or expense resulting from the Master Servicer's
failure to perform its duties hereunder or thereunder or incurred by reason of
the Master Servicer's negligence, willful misfeasance or bad faith.
Section 9.05. Merger or Consolidation.
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Any Person into which the Master Servicer may be merged or consolidated,
or any Person resulting from any merger, conversion, other change in form or
consolidation to which the Master Servicer shall be a party, or any Person
succeeding to the business of the Master Servicer shall be the successor to
the Master Servicer hereunder, without the execution or filing of any paper or
any further act on the part of any of the parties hereto, anything herein to
the contrary notwithstanding; provided, however, that the successor or
resulting Person to the Master Servicer shall be a Person that shall be
qualified and approved to service mortgage loans for Xxxxxx Xxx or FHLMC and
shall have a net worth of not less than $15,000,000.
As a condition to the effectiveness of any merger or consolidation, at
least 15 calendar days prior to the effective date of any merger or
consolidation of the Master Servicer, the Master Servicer shall provide (x)
written notice to the Depositor of any successor pursuant to this Section and
(y) in writing and in form and substance reasonably satisfactory to the
Depositor, all information reasonably requested by the Depositor in order to
comply with its reporting obligation under Item 6.02 of Form 8-K with respect
to a replacement Master Servicer.
Section 9.06. Resignation of Master Servicer and Securities
Administrator.
Except as otherwise provided in Sections 9.05, 9.07 and 9.10 hereof,
neither the Master Servicer nor the Securities Administrator shall resign from
the obligations and duties hereby imposed on it unless the duties of the
Master Servicer or the Securities Administrator, as applicable, hereunder are
no longer permissible under applicable law or are in material conflict by
reason of applicable law with any other activities carried on by it and cannot
be cured. Any such determination permitting the resignation of the Master
Servicer or the Securities Administrator shall be evidenced by an Opinion of
Counsel that shall be Independent to such effect delivered to the Trustee. No
resignation of the Master Servicer or the Securities Administrator shall
become effective until the Trustee shall have assumed, or a successor master
servicer or successor securities administrator, as applicable, shall have been
appointed pursuant to Section 6.07 or 9.02, as applicable, and until such
successor shall have assumed, such Master Servicer's or Securities
Administrator's responsibilities and obligations under this Agreement. Notice
of any such resignation shall be given promptly by the Master Servicer or the
Securities Administrator, as applicable, to the Depositor and the Trustee.
If, at any time, the Master Servicer resigns under this Section 9.06, or
transfers or assigns its rights and obligations under Section 9.07, or is
removed as Master Servicer pursuant to Section 6.14, then at such time Xxxxx
Fargo Bank, National Association (or any successor thereto) also shall resign
or be removed, as applicable, as Securities Administrator, Auction
Administrator, Paying Agent, Authenticating Agent and Certificate Registrar
under this Agreement. In such event, the obligations of the Master Servicer
and the Securities Administrator shall be assumed by the Trustee as successor
or by such other successor master servicer and/or securities administrator, as
applicable, appointed by the Trustee (subject to the provisions of Sections
6.07 and 9.02(a)).
As a condition to the effectiveness of any such resignation, at least 15
calendar days prior to the effective date of such resignation, the Master
Servicer shall provide (x) written notice to the Depositor of any successor
pursuant to this Section and (y) in writing and in form and substance
reasonably satisfactory to the Depositor, all information reasonably requested
by the
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Depositor in order to comply with its reporting obligation under Item 6.02 of
Form 8-K with respect to the resignation of the Master Servicer.
Section 9.07. Assignment or Delegation of Duties by the Master Servicer
and Securities Administrator.
Except as expressly provided herein, neither the Master Servicer nor the
Securities Administrator shall assign or transfer any of their respective
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 respective duties, covenants or obligations to be performed by the
Master Servicer or Securities Administrator, as applicable, hereunder;
provided, however, that the Master Servicer and the Securities Administrator
shall each have the right with the prior written consent of the Trustee and
the Depositor (which consent shall not be unreasonably withheld), and upon
delivery to the Trustee and the Depositor of a letter from each Rating Agency
to the effect that such action shall not result in a downgrading of the
Certificates, to delegate or assign to or subcontract with or authorize or
appoint any qualified Person to perform and carry out any of the respective
duties, covenants or obligations to be performed and carried out by the Master
Servicer or the Securities Administrator, as applicable, hereunder. Notice of
such permitted assignment shall be given promptly by the Master Servicer or
the Securities Administrator, as applicable, to the Depositor and the Trustee.
If, pursuant to any provision hereof, the respective duties of the Master
Servicer or the Securities Administrator are transferred to a successor master
servicer or successor securities administrator, as applicable, the entire
amount of the compensation payable to the Master Servicer or Securities
Administrator pursuant hereto shall thereafter be payable to such successor
master servicer or successor securities administrator. Such successor Master
Servicer shall also pay the fees of the Trustee, as provided herein.
Section 9.08. Limitation on Liability of the Master Servicer and Others.
(a) Neither the Master Servicer nor any of the directors, officers,
employees or agents of the Master Servicer shall be under any liability to the
Trustee 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 Master Servicer or any such person against any liability that would
otherwise be imposed by reason of willful misfeasance, bad faith or negligence
in its performance of its duties or by reason of reckless disregard for its
obligations and duties under this Agreement. The Master Servicer and any
director, officer, employee or agent of the Master Servicer may rely in good
faith on any document of any kind prima facie properly executed and submitted
by any Person respecting any matters arising hereunder. The Master Servicer
shall be under no obligation to appear in, prosecute or defend any legal
action that is not incidental to its duties to master service the Mortgage
Loans in accordance with this Agreement and that in its opinion may involve it
in any expenses or liability; provided, however, that the Master Servicer may
in its sole discretion undertake any such action that it may deem necessary or
desirable in respect to this Agreement and the rights and duties of the
parties hereto and the interests of the Certificateholders hereunder. In such
event, the legal expenses and costs of such action and any liability resulting
therefrom shall be expenses, costs and liabilities of the Trust Fund and the
Master Servicer shall be entitled to be reimbursed therefor out of the
Distribution Account.
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The Master Servicer shall not be liable for any acts or omissions of the
Servicers except to the extent that damages or expenses are incurred as a
result of such act or omissions and such damages and expenses would not have
been incurred but for the negligence, willful misfeasance, bad faith or
recklessness of the Master Servicer in supervising, monitoring and overseeing
the obligations of the Servicers in this Agreement and the Purchase and
Servicing Agreements.
Section 9.09. Indemnification; Third-Party Claims.
The Master Servicer agrees to indemnify the Depositor, the Securities
Administrator and the Trustee, and hold them harmless against any and all
claims, losses, penalties, fines, forfeitures, legal fees and related costs,
judgments, and any other costs, liability, fees and expenses that the
Depositor, the Securities Administrator or the Trustee may sustain as a result
of the Master Servicer's willful misfeasance, bad faith or negligence in the
performance of its duties hereunder or by reason of its reckless disregard for
its obligations and duties under this Agreement, the Acknowledgements and the
related Purchase and Servicing Agreements. The Depositor, the Securities
Administrator and the Trustee shall immediately notify the Master Servicer if
a claim is made by a third party with respect to this Agreement or the
Mortgage Loans entitling the Depositor, the Securities Administrator or the
Trustee to indemnification under this Section 9.09, whereupon the Master
Servicer shall assume the defense of any such claim and pay all expenses in
connection therewith, including counsel fees, and promptly pay, discharge and
satisfy any judgment or decree which may be entered against it or them in
respect of such claim.
Section 9.10. Eligibility Requirements for Securities Administrator.
The Securities Administrator hereunder shall at all times be a
corporation or association organized and doing business under the laws the
United States of America or any state thereof, authorized under such laws to
exercise corporate trust powers, having a combined capital and surplus of at
least $50,000,000, subject to supervision or examination by federal or state
authority and with a credit rating of at least investment grade or at least
"A/F1" by Fitch if Fitch is a Rating Agency. If such corporation or
association publishes reports of condition at least annually, pursuant to law
or to the requirements of the aforesaid supervising or examining authority,
then for the purposes of this Section 9.10 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 condition so published. In
case at any time the Securities Administrator shall cease to be eligible in
accordance with the provisions of this Section 9.10, the Securities
Administrator shall resign immediately in the manner and with the effect
specified in Section 6.06 hereof. The entity serving as Securities
Administrator may have normal banking and trust relationships with the
Depositor, the Seller, the Master Servicer, any Custodian or the Trustee and
their respective affiliates.
The Securities Administrator (i) may not be an Originator, Master
Servicer, 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 Xxxxx'x
(or such rating acceptable to Fitch pursuant to a written confirmation). If at
any time the Securities Administrator shall cease to be eligible in accordance
with the provisions of this Section 9.10, the Securities Administrator shall
resign in
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the manner and with the effect specified in Section 6.06 hereof. If no
successor Securities Administrator shall have been appointed and shall have
accepted appointment within 60 days after the Securities Administrator ceases
to be the Securities Administrator pursuant to this Section 9.10, then the
Trustee shall become the successor Securities Administrator and shall, in
accordance with Article VI hereof and in such capacity, perform the duties of
the Securities Administrator pursuant to this Agreement. The Trustee shall
notify the Rating Agencies of any change of Securities Administrator.
Section 9.11. Annual Statement as to Compliance.
The Master Servicer and the Securities Administrator shall deliver (and
the Master Servicer and Securities Administrator shall cause any Additional
Servicer engaged by it to deliver) or otherwise make available to the
Depositor and the Securities Administrator on or before March 15 of each year,
commencing in March 2007, 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, has been made under such officer's supervision, (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, 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 and (C) in the case of the Master
Servicer, to the best of such officer's knowledge, each Servicer has fulfilled
all its obligations under its Servicing Agreement in all material respects
throughout such year, 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.
The Master Servicer shall enforce any obligation of the Servicers, to
the extent set forth in the related Servicing Agreement, to deliver to the
Master Servicer and to the Depositor an annual statement of compliance and all
reports and other information required from the Servicers under Reg AB within
the time frame set forth in, and in such form and substance as may be required
pursuant to, the related Servicing Agreement The Master Servicer shall include
such annual statements of compliance with its own annual statement of
compliance to be submitted to the Securities Administrator pursuant to this
Section.
ARTICLE X
REMIC ADMINISTRATION
Section 10.01. REMIC Administration.
(a) REMIC elections as set forth in the Preliminary Statement shall be
made on Forms 1066 or other appropriate federal tax or information return for
the taxable year ending on the last day of the calendar year in which the
Certificates are issued. The regular interests and residual interest in each
REMIC shall be as designated in the Preliminary Statement.
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(b) The Closing Date is hereby designated as the "Startup Day" of each
REMIC within the meaning of section 860G(a)(9) of the Code. The latest
possible maturity date for purposes of Treasury Regulation 1.860G-1(a)(4) will
be the Latest Possible Maturity Date.
(c) The Securities Administrator shall 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 Securities
Administrator shall pay any and all tax related expenses (not including taxes)
of each REMIC, including but not limited to any professional fees or expenses
related to audits or any administrative or judicial proceedings with respect
to such REMIC that involve the Internal Revenue Service or state tax
authorities, but only to the extent that (i) such expenses are ordinary or
routine expenses, including expenses of a routine audit but not expenses of
litigation (except as described in (ii)); or (ii) such expenses or liabilities
(including taxes and penalties) are attributable to the negligence or willful
misconduct of the Securities Administrator in fulfilling its duties hereunder
(including its duties as tax return preparer). The Securities Administrator
shall be entitled to reimbursement of expenses to the extent provided in
clause (i) above from the Distribution Account, provided, however, the
Securities Administrator shall not be entitled to reimbursement for expenses
incurred in connection with the preparation of tax returns and other reports
as required by Section 6.20 and this Section.
(d) The Securities Administrator shall prepare, the Trustee shall sign
and the Securities Administrator shall file all of each REMIC's federal and
appropriate state tax and information returns as such REMIC's direct
representative. The expenses of preparing and filing such returns shall be
borne by the Securities Administrator. In preparing such returns, the
Securities Administrator shall, with respect to each REMIC other than the
Master REMIC: (i) treat the accrual period for interests in such REMIC as the
calendar month; (ii) account for distributions made from each REMIC other than
the Master REMIC as made on the first day of each succeeding calendar month;
(iii) account for income under the all-OID method at the weighted average of
the Net Mortgage Rates; (iv) use the aggregation method provided in Treasury
Regulation section 1.1275-2(c); and (v) account for income and expenses
related to each REMIC other than the Master REMIC in the manner resulting in
the lowest amount of excess inclusion income possible accruing to the Holder
of the residual interest in each such REMIC.
(e) The Securities Administrator or its designee shall perform on behalf of
each 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, if required by the Code, the
REMIC Provisions, or other such guidance, the Securities Administrator shall
provide, upon receipt of additional reasonable compensation, (i) to the
Treasury or other governmental authority such information as is necessary for
the application of any tax relating to the transfer of a Residual Certificate
to any disqualified person or organization pursuant to Treasury Regulation
1.860E-2(a)(5) and any person designated in Section 860E(e)(3) of the Code and
(ii) to the Certificateholders and the Trustee such information or reports as
are required by the Code or REMIC Provisions.
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(f) To the extent within their control, the Trustee, the Securities
Administrator, the Master Servicer and the Holders of Certificates shall take
any action or cause any REMIC to take any action necessary to maintain the
status of any REMIC as a REMIC under the REMIC Provisions and shall assist
each other as necessary to create or maintain such status. None of the
Trustee, the Securities Administrator, the Master Servicer, nor the Holder of
any Residual Certificate shall knowingly take any action, cause any REMIC to
take any action or fail to take (or fail to cause to be taken) any action
that, under the REMIC Provisions, if taken or not taken, as the case may be,
could result in an Adverse REMIC Event unless the Trustee, the Securities
Administrator and the Master Servicer have received an Opinion of Counsel (at
the expense of the party seeking to take such action) to the effect that the
contemplated action will not endanger such status or result in the imposition
of such a tax. In addition, prior to taking any action with respect to any
REMIC or the assets therein, or causing any REMIC to take any action, which is
not expressly permitted under the terms of this Agreement, any Holder of a
Residual Certificate will consult with the Trustee, the Securities
Administrator, the Master Servicer or their respective designees, in writing,
with respect to whether such action could cause an Adverse REMIC Event to
occur with respect to any REMIC, and no such Person shall take any such action
or cause any REMIC to take any such action as to which the Trustee, the
Securities Administrator or the Master Servicer has advised it in writing that
an Adverse REMIC Event could occur; provided, however, that if no Adverse
REMIC Event would occur but such action could result in the imposition of
additional taxes on the Residual Certificateholders, no such Person shall take
any such action, or cause any REMIC to take any such action without the
written consent of the Residual Certificateholders.
(g) Each Holder of a Residual Certificate shall pay when due any and all
taxes imposed on the related REMIC by federal or state governmental
authorities. To the extent that such taxes are not paid by a Residual
Certificateholder, the Paying Agent shall pay any remaining REMIC taxes out of
current or future amounts otherwise distributable to the Holder of the
Residual Certificate in any such REMIC or, if no such amounts are available,
(A) out of other amounts held in the Distribution Account, and shall reduce
amounts otherwise payable to holders of regular interests in any such REMIC or
(B) to the extent that any such taxes are imposed on the REMIC as a result of
the breach of any representation, warranty or covenant of the Master Servicer,
the Securities Administrator or any Servicer, then the Master Servicer, the
Securities Administrator, or that Servicer, as applicable, shall pay when due
any and all such taxes.
(h) The Securities Administrator shall, for federal income tax purposes,
maintain books and records with respect to each REMIC on a calendar year and
on an accrual basis.
(i) No additional contributions of assets shall be made to any REMIC,
except as expressly provided in this Agreement.
(j) Neither the Securities Administrator nor the Master Servicer shall
enter into any arrangement by which any REMIC will receive a fee or other
compensation for services.
(k) [Reserved].
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(l) The Class A-R Holder shall act as "tax matters person" with respect
to each REMIC created hereunder and the Securities Administrator shall act as
agent for the Class A-R Holder in such roles, unless and until another party
is so designated by the Class A-R Holder.
(m) The Securities Administrator, on behalf of the Trustee, shall treat
the Swap Account as an outside reserve fund within the meaning of Treasury
Regulation 1.860G-2(h) that is owned by the holders of the Class OC
Certificates, and that is not an asset of any REMIC created hereunder. The
Securities Administrator, on behalf of the Trustee, shall treat the rights of
the holders of the Certificates to receive Basis Risk Carry Forward Amounts
(calculated by excluding any such Amounts attributable to the excess of the
REMIC Cap over the Net WAC Pass-Through Rate) as rights in an interest rate
cap contract written by the Holders of the Class OC Certificates in favor of
the Holders of the Certificates. Thus, the Certificates shall be treated as
representing ownership of not only a Master REMIC regular interest, but also
ownership of an interest in an interest rate cap contract. For purposes of
determining the issue price of the Master REMIC regular interest, the
Securities Administrator, on behalf of the Trustee, shall assume that this
interest rate cap contract has a value of $5,000.
(n) The Securities Administrator, on behalf of the Trustee, shall
account for the Swap Trust as an asset of a grantor trust under subpart E,
Part I of subchapter J of the Code and not as an asset of any REMIC created
hereunder. For federal income tax purposes, Net Swap Payment Amounts and Swap
Termination Payments payable to the Swap Counterparty shall be deemed to be
paid to the Swap Trust first, from the Master REMIC, by the Holder of the
Class OC Certificates and second, from the Master REMIC by the Holders of the
applicable Class or Classes of Certificates as and to the extent that their
Pass-Through Rate is limited by the Net WAC Pass-Through Rate.
(o) Holders of Certificates shall also be treated as having agreed to
pay, on each Distribution Date, to the Holders of the Class OC Certificates an
aggregate amount equal to the excess, if any, of (i) Net Swap Payments and
Swap Termination Payments over (ii) the sum of amounts payable on the Class OC
Interest as provided in the Preliminary Statement hereof (such excess, a
"Class IO Shortfall"), first from interest and then from principal
distributable on the Certificates. Any payments of Class IO Shortfalls shall
be treated for tax purposes as having been received by the Holders of such
Class of Certificates in respect of the corresponding Master REMIC regular
interest and as having been paid by such Holders to the Holders of the Class
OC Certificates through the Swap Trust.
Section 10.02. Prohibited Transactions and Activities.
Neither the Depositor, the Master Servicer nor the Trustee shall sell,
dispose of, or substitute for any of the Mortgage Loans, except in a
disposition pursuant to (i) the foreclosure of a Mortgage Loan, (ii) the
bankruptcy of the Trust Fund, (iii) the termination of each REMIC pursuant to
Article VII of this Agreement, (iv) a substitution pursuant to Article II of
this Agreement or (v) a repurchase of Mortgage Loans pursuant to Article II of
this Agreement, nor acquire any assets for any REMIC, nor sell or dispose of
any investments in the Distribution Account for gain, nor accept any
contributions to any REMIC after the Closing Date, unless it has received an
Opinion of Counsel (at the expense of the party causing such sale,
disposition, substitution or acceptance) that such disposition, acquisition,
substitution, or acceptance will not
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result in an Adverse REMIC Event, (b) affect the distribution of interest or
principal on the Certificates or (c) result in the encumbrance of the assets
transferred or assigned to the Trust Fund (except pursuant to the provisions
of this Agreement).
The Master Servicer with respect to the Mortgage Loans shall not consent
to any modification of any such Mortgage Loan for which the consent of the
Master Servicer is required under the applicable Purchase and Servicing
Agreement under which such Mortgage Loan is serviced, that would (i) increase
the interest rate in respect of such Mortgage, defer for a period in excess of
six months or forgive the payment of any principal or interest, reduce the
outstanding principal amount (except for actual payments of principal),
increase the Servicing Fee on such Mortgage Loan or extend the final maturity
date on such Mortgage Loan, or (ii) result in a substitution or release of
collateral or in the provision of additional collateral for the Mortgage Loan,
unless the applicable Mortgage Loan is in default or default is reasonably
foreseeable in respect of such Mortgage Loan, or the Master Servicer has
received an Opinion of Counsel (at the expense of the party requesting consent
for such modification) that such modification will not result in an Adverse
REMIC Event.
Section 10.03. Indemnification with Respect to Prohibited Transactions
or Loss of REMIC Status.
Upon the occurrence of an Adverse REMIC Event due to the negligent
performance by the Securities Administrator of its duties and obligations set
forth herein, the Securities Administrator shall indemnify the
Certificateholders of the related Residual Certificate against any and all
losses, claims, damages, liabilities or expenses ("Losses") resulting from
such negligence; provided, however, that the Securities Administrator shall
not be liable for any such Losses attributable to the action or inaction of
the Depositor, the Trustee or the Holder of the Residual Certificate, nor for
any such Losses resulting from misinformation provided by any of the foregoing
parties on which the Securities Administrator has relied. Notwithstanding the
foregoing, however, in no event shall the Securities Administrator have any
liability (1) for any action or omission that is taken in accordance with and
in compliance with the express terms of, or which is expressly permitted by
the terms of, this Agreement or under any Purchase and Servicing Agreements or
under any Acknowledgement, (2) for any Losses other than arising out of
malfeasance, willful misconduct or negligent performance by the Service
Administrator of its duties and obligations set forth herein, and (3) for any
special or consequential damages to Certificateholders of the related Residual
Certificate (in addition to payment of principal and interest on the
Certificates).
Section 10.04. REO Property.
(a) Notwithstanding any other provision of this Agreement, the Master
Servicer, acting on behalf of the Trustee hereunder, shall not, except to the
extent provided in the applicable Purchase and Servicing Agreement, knowingly
permit any Servicer to, rent, lease, or otherwise earn income on behalf of any
REMIC with respect to any REO Property which might cause an Adverse REMIC
Event unless the applicable Servicer has provided to the Trustee and the
Securities Administrator an Opinion of Counsel concluding that, under the
REMIC Provisions, such action would not adversely affect the status of any
REMIC as a REMIC and any
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income generated for any REMIC by the REO Property would not result in an
Adverse REMIC Event.
(b) The Depositor shall cause the applicable Servicer (to the extent
provided in its Purchase and Servicing Agreement) to make reasonable efforts
to sell any REO Property for its fair market value. In any event, however, the
Depositor shall, or shall cause the applicable Servicer (to the extent
provided in its Purchase and Servicing Agreement) to, dispose of any REO
Property within three years of its acquisition by the Trust Fund unless the
Depositor or the applicable Servicer (on behalf of the Trust Fund) has
received a grant of extension from the Internal Revenue Service to the effect
that, under the REMIC Provisions and any relevant proposed legislation and
under applicable state law, the REMIC may hold REO Property for a longer
period without causing an Adverse REMIC Event. If such an extension has been
received, then the Depositor, acting on behalf of the Trustee hereunder,
shall, or shall cause the applicable Servicer to, continue to attempt to sell
the REO Property for its fair market value for such period longer than three
years as such extension permits (the "Extended Period"). If such an extension
has not been received and the Depositor or the applicable Servicer, acting on
behalf of the Trust Fund hereunder, is unable to sell the REO Property within
33 months after its acquisition by the Trust Fund or if such an extension, has
been received and the Depositor or the applicable Servicer is unable to sell
the REO Property within the period ending three months before the close of the
Extended Period, the Depositor shall cause the applicable Servicer, before the
end of the three year period or the Extended Period, as applicable, to (i)
purchase such REO Property at a price equal to the REO Property's fair market
value or (ii) auction the REO Property to the highest bidder (which may be the
applicable Servicer) in an auction reasonably designed to produce a fair price
prior to the expiration of the three-year period or the Extended Period, as
the case may be.
Section 10.05. Fidelity.
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 and
trustees.
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01. Binding Nature of Agreement; Assignment.
This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and permitted assigns.
Section 11.02. Entire Agreement.
This Agreement contains the entire agreement and understanding among the
parties hereto with respect to the subject matter hereof, and supersedes all
prior and contemporaneous
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agreements, understandings, inducements and conditions, express or implied,
oral or written, of any nature whatsoever with respect to the subject matter
hereof. The express terms hereof control and supersede any course of
performance and/or usage of the trade inconsistent with any of the terms
hereof.
Section 11.03. Amendment.
(a) This Agreement (other than the provisions of Article XII hereof) may
be amended from time to time by the Depositor, the Master Servicer, the
Securities Administrator, and the Trustee, without notice to or the consent of
any of the Holders, (i) to cure any ambiguity or mistake, (ii) to cause the
provisions herein to conform to or be consistent with or in furtherance of the
statements made with respect to the Certificates, the Trust Fund or this
Agreement in any Offering Document, or to correct or supplement any provision
herein which may be inconsistent with any other provisions herein or with the
provisions of any Purchase and Servicing Agreement, (iii) to make any other
provisions with respect to matters or questions arising under this Agreement
or (iv) to add, delete, or amend any provisions to the extent necessary or
desirable to comply with any requirements imposed by the Code and the REMIC
Provisions. No such amendment effected pursuant to the preceding sentence
shall, as evidenced by an Opinion of Counsel, result in an Adverse REMIC
Event, nor shall such amendment effected pursuant to clause (iii) of such
sentence adversely affect in any material respect the interests of any Holder.
Prior to entering into any amendment without the consent of Holders pursuant
to this paragraph, the Trustee shall be provided with an Opinion of Counsel
(at the expense of the party requesting such amendment) to the effect that
such amendment is permitted under this Section. Any such amendment shall be
deemed not to adversely affect in any material respect any Holder, if the
Trustee receives written confirmation from each Rating Agency that such
amendment will not cause such Rating Agency to reduce the then current rating
assigned to the Certificates.
(b) This Agreement (other than the provisions of Article XII hereof) may
also be amended from time to time by the Depositor, the Master Servicer, the
Securities Administrator and the Trustee, with the consent of the Holders of
not less than 66-2/3% of the Class Principal Balance (or Percentage Interest)
of each Class of Certificates affected thereby for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions
of this Agreement or of modifying in any manner the rights of the Holders;
provided, however, that no such amendment shall be made unless the Trustee
receives an Opinion of Counsel, at the expense of the party requesting the
change, that such change will not cause an Adverse REMIC Event; and provided
further, that no such amendment may (i) reduce in any manner the amount of, or
delay the timing of, payments received on Mortgage Loans which are required to
be distributed on any Certificate, without the consent of the Holder of such
Certificate or (ii) reduce the aforesaid percentages of Class Principal
Balance or Notional Amount (or Percentage Interest) of Certificates of each
Class, the Holders of which are required to consent to any such amendment
without the consent of the Holders of 100% of the Class Principal Balance or
Notional Amount (or Percentage Interest) of each Class of Certificates
affected thereby. For purposes of this paragraph, references to "Holder" or
"Holders" shall be deemed to include, in the case of any Class of Book-Entry
Certificates, the related Certificate Owners.
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(c) In the event the parties to this Agreement desire to further clarify
or amend any provision of Article XII hereof, this Agreement shall be amended
to reflect the new agreement between the parties covering matters in Article
XII, which amendment shall not require any Opinion of Counsel or Rating Agency
confirmations or the consent of any Certificateholder.
(d) Promptly after the execution of any such amendment, the Securities
Administrator shall furnish written notification of the substance of such
amendment to each Holder, the Depositor and the Rating Agencies.
(e) It shall not be necessary for the consent of Holders under this
Section 11.03 to approve the particular form of any proposed amendment, but it
shall be sufficient if such consent shall approve the substance thereof. The
manner of obtaining such consents and of evidencing the authorization of the
execution thereof by Holders shall be subject to such reasonable regulations
as the Trustee may prescribe.
Section 11.04. Voting Rights.
Except to the extent that the consent of all affected Certificateholders
is required pursuant to this Agreement, with respect to any provision of this
Agreement requiring the consent of Certificateholders representing specified
percentages of aggregate outstanding Certificate Balance or Notional Amount
(or Percentage Interest), Certificates owned by the Depositor, the Master
Servicer, the Securities Administrator, the Trustee, any Servicer or any
Affiliates thereof are not to be counted so long as such Certificates are
owned by the Depositor, the Master Servicer, the Securities Administrator, the
Trustee, any Servicer or any Affiliate thereof.
Section 11.05. Provision of Information.
(a) For so long as any of the Certificates of any Class are "restricted
securities" within the meaning of Rule 144(a)(3) under the Act, each of the
Depositor, the Master Servicer, the Securities Administrator and the Trustee
(upon instruction from the Depositor) agree to cooperate with each other to
provide to any Certificateholders and to any prospective purchaser of
Certificates designated by such holder, upon the request of such holder or
prospective purchaser, any information required to be provided to such holder
or prospective purchaser to satisfy the condition set forth in Rule 144A(d)(4)
under the Act. Any reasonable, out-of-pocket expenses incurred by the Trustee,
the Master Servicer or the Securities Administrator in providing such
information shall be reimbursed by the Depositor.
(b) The Securities Administrator shall provide to any person to whom a
Prospectus was delivered, upon the request of such person specifying the
document or documents requested, a copy (excluding exhibits) of any report on
Form 8-K or Form 10-K filed with the Securities and Exchange Commission
pursuant to Section 6.20(b). Any reasonable out-of-pocket expenses incurred by
the Securities Administrator in providing copies of such documents shall be
reimbursed by the Depositor.
Section 11.06. Governing Law.
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(a) THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS WITHOUT REGARD TO
CONFLICT OF LAWS PRINCIPLES APPLIED IN NEW YORK (OTHER THAN SECTION 5-1401 OF
THE NEW YORK GENERAL OBLIGATIONS LAW).
Section 11.07. Notices.
All requests, demands, notices, authorizations, directions, consents,
waivers and communications hereunder shall be in writing and shall be deemed
to have been duly given when received by (a) in the case of the Depositor,
Xxxxxx Xxxxxxx Capital I Inc., 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
telephone number (000) 000-0000, Attention: Xxxxxx Xxxxxxx Mortgage Loan Trust
2006-9AR, (b) in the case of the Seller, Xxxxxx Xxxxxxx Mortgage Capital Inc.,
0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxx
Xxxxxxx Mortgage Loan Trust 2006-9AR, (c) in the case of the Master Servicer
or the Securities Administrator, Xxxxx Fargo Bank, National Association, X.X.
Xxx 00, Xxxxxxxx, Xxxxxxxx 00000 (or, for overnight deliveries, 0000 Xxx
Xxxxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxx 00000), telecopy number (000) 000-0000,
Attention: Xxxxxx Xxxxxxx Mortgage Loan Trust 2006-9AR, (d) with respect to
the Trustee or the Certificate Registrar, its respective Corporate Trust
Office and (e) in the case of the Rating Agencies, the address specified
therefor in the definition corresponding to the name of such Rating Agency, or
as to each party such other address as may hereafter be furnished by such
party to the other parties in writing. All demands, notices and communications
to a party hereunder shall be in writing and shall be deemed to have been duly
given when delivered to such party at the relevant address, facsimile number
or electronic mail address set forth above or at such other address, facsimile
number or electronic mail address as such party may designate from time to
time by written notice in accordance with this Section 11.07.
Section 11.08. Severability of Provisions.
If any one or more of the covenants, agreements, provisions or terms of
this Agreement shall be for any reason whatsoever held invalid, then such
covenants, agreements, provisions or terms shall be deemed severable from the
remaining covenants, agreements, provisions or terms of this Agreement and
shall in no way affect the validity or enforceability of the other provisions
of this Agreement or of the Certificates or the rights of the Holders thereof.
Section 11.09. Indulgences; No Waivers.
Neither the failure nor any delay on the part of a party to exercise any
right, remedy, power or privilege under this Agreement shall operate as a
waiver thereof, nor shall any single or partial exercise of any right, remedy,
power or privilege preclude any other or further exercise of the same or of
any other right, remedy, power or privilege, nor shall any waiver of any
right, remedy, power or privilege with respect to any occurrence be construed
as a waiver of such right, remedy, power or privilege with respect to any
other occurrence. No waiver shall be effective unless it is in writing and is
signed by the party asserted to have granted such waiver.
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Section 11.10. Headings Not To Affect Interpretation.
The headings contained in this Agreement are for convenience of
reference only, and they shall not be used in the interpretation hereof.
Section 11.11. Benefits of Agreement.
Nothing in this Agreement or in the Certificates, express or implied,
shall give to any Person, other than the parties to this Agreement and their
successors hereunder and the Holders of the Certificates, any benefit or any
legal or equitable right, power, remedy or claim under this Agreement, except
to the extent specified in Section 11.15.
Section 11.12. Special Notices to the Rating Agencies.
(a) The Depositor shall give prompt notice to the Rating Agencies of the
occurrence of any of the following events of which it has notice:
(i) any amendment to this Agreement pursuant to Section 11.03;
(ii) any assignment by the Master Servicer of its rights hereunder
or delegation of its duties hereunder;
(iii) the occurrence of any Event of Default described in Section
6.14;
(iv) any notice of termination given to the Master Servicer pursuant
to Section 6.14 and any resignation of the Master Servicer hereunder;
(v) the appointment of any successor to any Master Servicer pursuant
to Section 6.14;
(vi) the making of a final payment pursuant to Section 7.02; and
(vii) any termination of the rights and obligations of any Servicer
under the applicable Purchase and Servicing Agreement.
(b) All notices to the Rating Agencies provided for this Section shall
be in writing and sent by first class mail, telecopy or overnight courier, to
the address specified therefor in the definition corresponding to the name of
such Rating Agency.
(c) The Securities Administrator shall provide or make available to the
Rating Agencies reports prepared pursuant to Section 4.05. In addition, the
Securities Administrator shall, at the expense of the Trust Fund, make
available to each Rating Agency such information as such Rating Agency may
reasonably request regarding the Certificates or the Trust Fund, to the extent
that such information is reasonably available to the Securities Administrator.
(d) The Depositor hereby represents to S&P that, to the Depositor's
knowledge, the information provided to such Rating Agency, including the loan
level detail, is true and correct according to such Rating Agency's
requirements.
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Section 11.13. Conflicts.
To the extent that the terms of this Agreement conflict with the terms
of any Purchase and Servicing Agreement, the related Purchase and Servicing
Agreement shall govern.
Section 11.14. Counterparts.
This Agreement may be executed in one or more counterparts, each of
which shall be deemed to be an original, and all of which together shall
constitute one and the same instrument.
Section 11.15. No Petitions.
The Trustee and the Master Servicer (not in its individual corporate
capacity, but solely as Master Servicer hereunder), by entering into this
Agreement, hereby covenant and agree that they shall not at any time institute
against the Depositor, or join in any institution against the Depositor of,
any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceedings, or other proceedings under any United States federal or state
bankruptcy or similar law in connection with any obligations relating to this
Agreement or any of the documents entered into by the Depositor in connection
with the transactions contemplated by this Agreement, except that the Trustee
shall not be prohibited from filing a proof of claim in any such proceeding.
Section 11.16. Indemnification by Trust.
Pursuant to the Purchase and Servicing Agreements, each of the
Originators and Servicers shall be indemnified by the Trust to the extent
specified in the related Purchase and Servicing Agreement.
Pursuant to the Custodial Agreements, each of the Custodians shall be
indemnified by the Trust to the extent specified in the related Custodial
Agreement.
ARTICLE XII
EXCHANGE ACT REPORTING
Section 12.01. Filing Obligations.
(a) The Master Servicer, the Securities Administrator, the Trustee and
each Custodian shall reasonably cooperate with the Depositor in connection
with the satisfaction of the Depositor's reporting requirements under the
Exchange Act with respect to the Trust Fund. In addition to the information
specified below, if so requested by the Depositor for the purpose of
satisfying its reporting obligation under the Exchange Act, the Master
Servicer, the Securities Administrator, the Trustee and each Custodian shall
(and the Master Servicer shall cause each Servicer, to the extent required by
the related Servicing Agreement, to) provide the Depositor with (a) such
information which is available to such Person without unreasonable effort or
expense and within such timeframe as may be reasonably requested by the
Depositor to comply with the Depositor's reporting obligations under the
Exchange Act and (b) to the extent such Person is a party (and the Depositor
is not a party) to any agreement or amendment required to
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be filed, copies of such agreement or amendment in XXXXX-compatible form. Each
of the Master Servicer (and the Master Servicer shall cause any Servicer to
notify promptly, to the extent required by the related Servicing Agreement),
the Securities Administrator, each Custodian and the Trustee shall promptly
notify the Depositor and the Master Servicer (if the notifying party is not
the Master Servicer), but in no event later than two (2) Business Days after
its occurrence, of any Reportable Event either (i) with respect to itself or
any Affiliate of it or (ii) with respect to any Reporting Party, to the extent
that it has received notice thereof.
(b) On or prior to January 30 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 relating to the automatic
suspension of reporting in respect of the Trust under the Exchange Act.
(c) In the event that the Securities Administrator is unable to file
timely with the Commission all or any required portion of any Form 8-K, Form
10-D or Form 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 immediately notify the Depositor. In the
case of Form 10-D and Form 10-K, the parties to this Agreement will (and the
Master Servicer shall cause each Servicer to cooperate) prepare and file a
Form 12b-25 and a Form 10-DA and Form 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 shall include such disclosure information in the next Form 10-D
unless directed by the Depositor to file a Form 8-K with such Form 8-K
Disclosure Information. In the event that any previously filed Form 8-K, Form
10-D or Form 10-K needs to be amended, and such amendment includes any
Additional Form 10-D Disclosure, any Additional Form 10-K Disclosure or any
Form 8-K Disclosure Information or an amendment to any such disclosure, the
Securities Administrator will notify the Depositor and each Servicer affected
by such amendment (unless such amendment is solely for the purpose of
restating the monthly statement referred to in Section 4.05 hereof) and such
parties will cooperate to prepare any necessary Form 8-KA, Form 10-DA or Form
10-KA. Any Form 15, Form 12b-25 or any amendment to a Form 8-K or a Form 10-D
shall be signed by a duly authorized representative of the Master Servicer.
Any amendment to a Form 10-K shall be signed by a senior officer of the Master
Servicer in charge of the master servicing function. The parties to this
Agreement acknowledge that the performance by the Master Servicer and the
Securities Administrator of its duties under this Article XII related to the
timely preparation and filing of a Form 15, Form 12b-25 or any amendment to a
Form 8-K, Form 10-D or Form 10-K is contingent upon each such party performing
its duties under this Section. 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 a Form
8-K, Form 10-D or Form 10-K, where such failure results from the Securities
Administrator's inability or failure to obtain or receive, on a timely basis,
any information from any other party hereto needed to prepare, arrange for
execution or file such Form 15, Form 12b-25 or any amendments to Form 8-K,
Form 10-D or Form 10-K, not resulting from their own respective negligence,
bad faith or willful misconduct.
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(d) All items under this Article XII to be reviewed by the Depositor
should be forwarded electronically to xxxxxxxxxxxxxx@xxxxxxxxxxxxx.xxx. In
addition, for purposes of this Article XII, if the Securities Administrator or
the Master Servicer is required to provide any information or documentation to
such other party, for so long as Xxxxx Fargo Bank, National Association is
both Securities Administrator and Master Servicer, that delivery will be
automatically deemed to have been made.
(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 shall notify the Securities Administration 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 questions should be "no." In the absence of such notification by the
Depositor to the Securities Administrator, the Securities Administrator shall
be entitled to assume that the answer to the questions on Form 10-D and Form
10-K should be "yes". The Securities Administrator shall be entitled to rely
on such representations in preparing, executing and/or filing any such report.
Section 12.02. Form 10-D Reporting.
(a) No later than 5:00 p.m., New York time, on the 15th calendar day
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 prepared
and filed by the Securities Administrator pursuant to the following paragraph
and the Securities Administrator will have no duty or liability for any
failure hereunder to determine any Additional Form 10-D Disclosure, except as
set forth in the next paragraph.
(b) In accordance with the respective reporting obligations set forth on
Exhibit N-1 hereto, within 5 calendar days after the related Distribution
Date, the Master Servicer and any other Reporting Party shall be required to
provide to the Securities Administrator and the Depositor 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 P attached hereto (an "Additional
Disclosure Notification"). The Securities Administrator shall notify the
Depositor of any Additional Form 10-D Disclosure with respect to itself or any
of its Affiliates and any other Additional Form 10-D Disclosure received by
it. Within one (1) Business Day of such notification, the Depositor will
approve 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 additional 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.
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(c) After preparing the Form 10-D, and no later than the close of
business on the 11th calendar day after the Distribution Date, the Securities
Administrator shall forward electronically a draft copy of the Form 10-D to
the Master Servicer and to the Depositor for review. No later than the 13th
calendar day after the Distribution Date, the Depositor shall notify the
Securities Administrator in writing (which may be provided electronically) of
any changes to or approve the filing of such Form 10-D. In the absence of
receipt of any written changes or approval, 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
and return an electronic or fax copy of such signed Form 10-D (with an
original executed hard copy to follow by overnight mail) to the Securities
Administrator. 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 12.01(c) hereof. 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. The signing party at
the Master Servicer can be contacted by e-mail at
xxx.xxx.xxxxxxxxxxxxx@xxxxxxxxxx.xxx or by facsimile (000) 000-0000. Each
party to this Agreement acknowledges that the performance by the Securities
Administrator and the Master Servicer of its duties under this Section 12.02
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 under this Section 12.02. Neither the
Securities Administrator nor the Master Servicer 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
obtain or receive, on a timely basis, any information from any other party
hereto (other than an Affiliate thereof) needed to prepare, arrange for
execution or file such Form 10-D, not resulting from their respective
negligence, bad faith or willful misconduct.
Section 12.03. Form 8-K Reporting.
(a) As directed by the Depositor, within four (4) Business Days after
the occurrence of an event requiring disclosure on Form 8-K (each such event,
a "Reportable Event"), the Securities Administrator shall prepare and file on
behalf of the Trust any Form 8-K, as required by the Exchange Act, provided
that the Depositor shall file the initial Form 8-K (operative agreements) 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 ("Form 8-K Disclosure Information") shall be prepared by
the Securities Administrator 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.
(b) In accordance with the respective reporting obligations set forth on
Exhibit N-3 hereto, no later than the close of business on the second Business
Day immediately following the occurrence of a Reportable Event, each of the
Securities Administrator, the Custodian, the Trustee, the Master Servicer and
the Depositor shall be required to provide to the Securities Administrator and
the Depositor, as applicable, in XXXXX-compatible form, or in such other form
as otherwise
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agreed upon by the Securities Administrator and such party, the form and
substance of any Additional Form 8-K Disclosure, if applicable, together with
an Additional Disclosure Notification. The Securities Administrator shall
notify the Depositor of any Form 8-K Disclosure Information with respect to
itself or any of its Affiliates and any other Form 8-K Disclosure Information
received by it. The Depositor will approve or disapprove, as the case may be,
the inclusion of the Form 8-K Disclosure Information on Form 8-K. The
Depositor will be responsible for any reasonable additional 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.
(c) After preparing the Form 8-K, the Securities Administrator shall
forward electronically a draft copy of the Form 8-K to the Depositor and the
Master Servicer for review no later than 12:00 p.m., New York time, on the
third Business Day following the Reportable Event. The Depositor shall notify
the Securities Administrator in writing (which may be provided electronically)
of any changes to or approval of such Form 8-K no later than the close of
business on the third Business Day following the Reportable Event. In the
absence of receipt of any written changes or approval, 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. By 12:00 p.m., New York time, on the fourth Business Day after
the occurrence of the Reportable Event, a duly authorized representative of
the Master Servicer shall sign the Form 8-K, then return an electronic or fax
copy of such signed Form 8-K (with an original executed hard copy to follow by
overnight mail) to the Securities Administrator. 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 12.01(c). With
respect to each Form 8-K prepared and filed by the Securities Administrator,
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 thereof. The parties to this Agreement acknowledge that
the performance by the Master Servicer and the Securities Administrator of its
duties under this Section 12.03 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 Section
12.03. Neither the Securities Administrator nor the Master Servicer 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 obtain or receive, on a timely basis, any information
from any other party hereto (other than an Affiliate thereof) needed to
prepare, arrange for execution or file such Form 8-K, not resulting from their
respective negligence, bad faith or willful misconduct.
Section 12.04. Form 10-K Reporting.
(a) Within 90 days (including 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"), commencing in March 2007 and continuing until
the Trust has been deregistered with the Commission, 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 and the related
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Servicing Agreement, (i) an annual compliance statement for each Servicer,
each Additional Servicer, the Master Servicer, each Custodian and the
Securities Administrator (each such party and each Custodian, a "Reporting
Servicer") as described under Section 9.11, (ii)(A) the annual reports on
assessment of compliance with servicing criteria for each Reporting Servicer,
as described under Section 12.06, and (B) if each Reporting Servicer's report
on assessment of compliance with servicing criteria described under Section
12.06 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 12.06 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 12.06, and (B) if any
registered public accounting firm attestation report described under Section
12.06 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 12.05. 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 determined and prepared by and at the direction of 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.
(b) In accordance with the respective reporting obligations set forth on
Exhibit N-2 hereto, no later than March 15 of each year that the Trust is
subject to the Exchange Act reporting requirements, commencing in 2007 and
continuing until the Trust has been deregistered with the Commission, the
Master Servicer and any other Reporting Party shall be required to provide to
the Securities Administrator and the Depositor, 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. The
Securities Administrator shall notify the Depositor of any Additional Form
10-K Disclosure with respect to itself or any of its Affiliates and any other
Additional Form 10-K Disclosure received by it. Within one (1) Business Day of
such notification, the Depositor will approve 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 additional 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.
(c) After preparing the Form 10-K, the Securities Administrator shall
forward electronically a draft copy of the Form 10-K to the Master Servicer
and, upon request, to the Depositor for review. No later than the earlier of:
(x) three (3) Business Days following the receipt by the Depositor and (y)
March 25th, the Depositor and the Master Servicer shall notify the Securities
Administrator in writing (which may be provided electronically) of any changes
to or approve the filing of such Form 10-K. In the absence of receipt of any
written changes or approval, 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
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the Master Servicer in charge of the master servicing function shall sign the
Form 10-K and return an electronic or fax copy of such signed Form 10-K (with
an original executed hard copy to follow by overnight mail) to the Securities
Administrator. 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 12.01(c). 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 its duties under this Section 12.04 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 12.04, Section 9.11 Section 12.05 and Section 12.06.
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-K,
where such failure results from the Master Servicer's or the Securities
Administrator's inability or failure to obtain or 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 their own respective
negligence, bad faith or willful misconduct.
Section 12.05. Xxxxxxxx-Xxxxx Certification.
Each Form 10-K shall include a Xxxxxxxx-Xxxxx Certification required to
be included therewith pursuant to the Xxxxxxxx-Xxxxx Act. The senior officer
of the Master Servicer in charge of the master servicing function shall sign
the Xxxxxxxx-Xxxxx Certification and shall serve as the Certifying Person on
behalf of the Trust.
The respective parties hereto agree to cooperate with all reasonable
requests made by any Certifying Person or Certification Party in connection
with such Person's attempt to conduct any due diligence that such Person
reasonably believes to be appropriate in order to allow it to deliver any
Xxxxxxxx-Xxxxx Certification or portion thereof with respect to the Trust
Fund.
Section 12.06. Reports on Assessment of Compliance and Attestation.
(a) By March 15 of each year (such date includes the expiration of any
applicable grace period), commencing in March 2007, the Master Servicer, the
Securities Administrator, each Custodian (for so long as a Form 10-K will be
filed on behalf of the Trust for the preceding calendar year) and each other
Reporting Party, 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 12.04, including, if there has been any material instance of
noncompliance with the Relevant Servicing Criteria, a discussion of each such
failure
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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.
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 and each Custodian shall each
forward to the Securities Administrator 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; however if the Master Servicer and the Securities
Administrator are the same entity, then the Master Servicer is not required to
forward to the Securities Administrator its 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 12.04. 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 12.06(b) of each Servicing Function Participant engaged by
it.
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, each Custodian 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 O and on any similar exhibit set forth in each Servicing
Agreement in respect of each Servicer and notify the Depositor of any
exceptions.
(b) By March 15 of each year, commencing in March 2007, the Master
Servicer, the Securities Administrator, each Custodian (for so long as a Form
10-K will be filed in respect of the Trust for the preceding calendar year)
and each other Reporting Party, 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 Trustee, the Custodian,
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 a 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.
144
Promptly after receipt of such report from the Master Servicer, the
Securities Administrator, each Custodian or any Servicing Function Participant
engaged by such parties, (i) the Depositor shall review the report and, if
applicable, consult with such parties as to the nature of any defaults by such
parties, in the fulfillment of any of each such party's obligations hereunder
or under any other applicable agreement, and (ii) the Securities Administrator
shall confirm that each assessment submitted pursuant to Section 12.06(a) is
coupled with an attestation meeting the requirements of this Section 12.06(b)
and notify the Depositor of any exceptions.
Section 12.07. Use of Subcontractors.
(a) The Master Servicer shall cause any Subcontractor used by the Master
Servicer for the benefit of the Depositor to comply with the provisions of
Section 9.11 and this Article XII to the same extent as if such Subcontractor
were the Master Servicer (except with respect to the Master Servicer's duties
with respect to preparing and filing any Exchange Act Reports or as the
Certifying Person). The Master Servicer shall be responsible for obtaining
from each Subcontractor and delivering to the Depositor any servicer
compliance statement required to be delivered by such Subcontractor under
Section 9.11, any assessment of compliance and attestation required to be
delivered by such Subcontractor under Section 12.07 and any certification
required to be delivered to the Certifying Person under Section 12.05 as and
when required to be delivered. As a condition to the succession to any
Subcontractor as subservicer under this Agreement by any Person (i) into which
such Subcontractor may be merged or consolidated, or (ii) which may be
appointed as a successor to any Subcontractor, the Master Servicer shall
provide to the Depositor, at least 15 calendar days prior to the effective
date of such succession or appointment, (x) written notice to the Depositor of
such succession or appointment and (y) in writing and in form and substance
reasonably satisfactory to the Depositor, all information reasonably requested
by the Depositor in order to comply with its reporting obligation under Item
6.02 of Form 8-K.
(b) It shall not be necessary for the Master Servicer or the Trustee to
seek the consent of the Depositor or any other party hereto to the utilization
of any Subcontractor. The Master Servicer or the Trustee, as applicable, shall
promptly upon request provide to the Depositor (or any designee of the
Depositor, such as the Master Servicer or administrator) a written description
(in form and substance satisfactory to the Depositor) of the role and function
of each Subcontractor utilized by such Person, specifying (i) the identity of
each such Subcontractor, (ii) which (if any) of such Subcontractors are
"participating in the servicing function" within the meaning of Item 1122 of
Regulation AB, and (iii) which elements of the Servicing Criteria will be
addressed in assessments of compliance provided by each Subcontractor
identified pursuant to clause (ii) of this paragraph.
As a condition to the utilization of any Subcontractor determined to be
a Reporting Subcontractor, the Master Servicer or the Trustee, as applicable,
shall cause any such Subcontractor used by such Person for the benefit of the
Depositor to comply with the provisions of Sections 12.07 and 12.09 of this
Agreement to the same extent as if such Subcontractor were the Master Servicer
(except with respect to the Master Servicer's duties with respect to preparing
and filing any Exchange Act Reports or as the Certifying Person) or the
Trustee, as applicable. The Master Servicer or the Trustee, as applicable,
shall be responsible for obtaining from each
145
Subcontractor and delivering to the Depositor and the Master Servicer, any
assessment of compliance and attestation required to be delivered by such
Subcontractor under Section 12.07, in each case as and when required to be
delivered.
Section 12.08. Indemnification by the Master Servicer and the Securities
Administrator.
(a) The Master Servicer and the Securities Administrator (each, an
"Indemnifying Party"), shall, severally and not jointly, indemnify the
Depositor and the Seller for the preparation, execution or filing of any
report required to be filed with the Commission with respect to the Trust
Fund, or for execution of a certification pursuant to Rule 13a-14(d) or Rule
15d-14(d) under the Exchange Act with respect to the Trust Fund; and the
respective present and former directors, officers, employees and agents of
each of the foregoing and shall hold each of them harmless from and against
any losses, damages, penalties, fines, forfeitures, legal fees and expenses
and related costs, judgments, and any other costs, fees and expenses that any
of them may sustain arising out of or based upon:
(i) any untrue statement of a material fact contained or alleged to
be contained in or the omission or alleged omission to state a material
fact required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading in (A) any compliance certificate delivered by
it, or by any Servicing Function Participant engaged by it, pursuant to
this Agreement, (B) any assessment or attestation delivered by or on
behalf of it, or by any Servicing Function Participant engaged by it,
pursuant to this Agreement, or (C) any Additional Form 10-D Disclosure,
Additional Form 10-K Disclosure or Form 8-K Disclosure Information
concerning the Securities Administrator or the Master Servicer and
provided by either of them;
(ii) any failure by the Indemnifying Party to perform its
obligations when and as required under this Article XII; or
(iii) any negligence, bad faith or willful misconduct by the
Indemnifying Party.
In the case of any failure of performance described in clause (a)(ii) of
this Section, the Indemnifying Party shall promptly reimburse the Seller or
the Depositor, as applicable, and each Person responsible for the preparation,
execution or filing of any report required to be filed with the Commission
with respect to such Securitization Transaction, or for execution of a
certification pursuant to Rule 13a-14(d) or Rule 15d-14(d) under the Exchange
Act with respect to the Trust, for all costs reasonably incurred by each such
party in order to obtain the information, report, certification, accountants'
letter or other material not delivered as required by the Indemnifying Party
or any Subservicer or Subcontractor of the Indemnifying Party.
(b) (i) Any failure by the Indemnifying Party or any Subservicer or any
Subcontractor of the Indemnifying Party to deliver any information, report,
certification or accountants' letter when and as required under this Article
XII, including (except as provided below) any failure by the Indemnifying
Party to identify pursuant to Section 12.07 any Subcontractor "participating
in the servicing function" within the meaning of Item 1122 of Regulation AB,
which continues unremedied for ten calendar days after the date on which such
146
information, report, certification or accountants' letter was required to be
delivered shall constitute an Event of Default with respect to the
Indemnifying Party under this Agreement, and shall entitle the Seller or
Depositor, as applicable, in its sole discretion to terminate the rights and
obligations of the Indemnifying Party under this Agreement without payment
(notwithstanding anything in this Agreement to the contrary) of any
compensation to the Indemnifying Party; provided that to the extent that any
provision of this Agreement and/or any applicable Reconstitution Agreement
expressly provides for the survival of certain rights or obligations following
termination of the Master Servicer as servicer, such provision shall be given
effect.
Neither the Seller nor any Depositor shall be entitled to terminate the
rights and obligations of an Indemnifying Party pursuant to this subparagraph
(b)(ii) if a failure of the Master Servicer to identify a Subcontractor
"participating in the servicing function" within the meaning of Item 1122 of
Regulation AB was attributable solely to the role or functions of such
Subcontractor with respect to mortgage loans other than the Mortgage Loans.
(ii) The Indemnifying Party shall promptly reimburse the Seller and
any Depositor for all reasonable expenses incurred by them, in connection
with the termination of the Indemnifying Party and the transfer of their
duties to a successor. The provisions of this paragraph shall not limit
whatever rights the Seller or the Depositor may have under other
provisions of this Agreement or otherwise, whether in equity or at law,
such as an action for damages, specific performance or injunctive relief.
Section 12.09. Indemnification by the Custodian.
(a) If the entity serving as Trustee is also serving as a Custodian,
such entity in its capacity as Custodian shall indemnify the Depositor, each
affiliate of the Depositor, the Master Servicer and each Person who controls
any of such parties (within the meaning of Section 15 of the Securities Act
and Section 20 of the Exchange Act); and the respective directors, officers,
and employees of each of the foregoing (each, an "Indemnified Party"), and
shall hold each of them harmless from and against any losses, damages,
penalties, fines, forfeitures, legal fees and expenses and related costs,
judgments, and any other costs, fees and expenses that any of them may sustain
directly relating to:
(i) (A) any untrue statement of a material fact contained or
alleged to be contained in any information, compliance assessment or
other material it is required to provide or cause to be provided under
this Article XII (collectively, the "Custodian Information", or (B) the
omission or alleged omission to state in the Custodian Information a
material fact required to be stated therein or necessary in order to
make the statements therein, in the light of the circumstances under
which they were made, not misleading; or
(ii) any failure to deliver or cause to be delivered any
information, report, certification, accountants' attestation or other
material when and as required under this Article XII.
If the indemnification provided for herein is unavailable or
insufficient to hold harmless an Indemnified Party, then the Custodian agrees
that it shall contribute to the amount paid or payable by such Indemnified
Party as a result of any claims, losses, damages or liabilities incurred by
such Indemnified Party in such proportion as is appropriate to reflect the
relative fault of such Indemnified Party on the one hand and the Custodian on
the other.
(b) In the case of any failure of performance described in clause (a) of
this Section 12.09, the Custodian shall promptly reimburse the Indemnified
Party responsible for the preparation, execution or filing of any report
required to be filed with the Commission with respect to such Securitization
Transaction, or for execution of a certification pursuant to Rule 13a-14(d) or
Rule 15d-14(d) under the Exchange Act with respect to the Trust, for all costs
reasonably incurred by each such party in order to obtain the information,
report, certification, accountants' letter or other material not delivered as
required.
(c) This indemnification shall survive the termination of this Agreement
or the termination of any party to this Agreement.
147
IN WITNESS WHEREOF, the parties hereto have caused their names to be
signed hereto by their respective officers hereunto duly authorized as of the
day and year first above written.
XXXXXX XXXXXXX CAPITAL I INC.,
as Depositor
By: /s/ Xxxxxxx Xxx
------------------------------------
Name: Xxxxxxx Xxx
Title: Vice President
LASALLE BANK NATIONAL ASSOCIATION,
as Trustee and a Custodian
By: /s/ Xxxxx X. Xxxx
------------------------------------
Name: Xxxxx X. Xxxx
Title: Assistant Vice President
By: /s/ Xxxx Xxxxx
------------------------------------
Name: Xxxx Xxxxx
Title: Vice President
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
as Master Servicer
By: /s/ Xxxxxxxx Xxxxx
------------------------------------
Name: Xxxxxxxx Xxxxx
Title: Vice President
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
as Securities Administrator
By: /s/ Xxxxxxxx Xxxxx
------------------------------------
Name: Xxxxxxxx Xxxxx
Title: Vice President
Solely for purposes of Section 2.05 accepted and agreed to by:
XXXXXX XXXXXXX MORTGAGE CAPITAL INC.
By: /s/ Xxxxxxx Xxx
---------------------------------
Name: Xxxxxxx Xxx
Title: Vice President
EXHIBIT A
FORMS OF CERTIFICATES
A-1
EXHIBIT B
FORM OF RESIDUAL CERTIFICATE TRANSFER AFFIDAVIT (TRANSFEREE)
STATE OF )
)ss.:
COUNTY OF )
[NAME OF OFFICER], _________________ being first duly sworn, deposes and
says:
1. That he [she] is [title of officer] ________________________ of
[name of Purchaser] _________________________________________ (the
"Purchaser"), a _______________________ [description of type of
entity] duly organized and existing under the laws of the [State
of __________] [United States], on behalf of which he [she] makes
this affidavit.
2. That the Purchaser's Taxpayer Identification Number is [ ].
3. That the Purchaser is not a "disqualified organization" within
the meaning of Section 860E(e)(5) of the Internal Revenue Code of
1986, as amended (the "Code") and will not be a "disqualified
organization" as of [date of transfer], and that the Purchaser is
not acquiring a Residual Certificate (as defined in the
Agreement) for the account of, or as agent (including a broker,
nominee, or other middleman) for, any person or entity from which
it has not received an affidavit substantially in the form of
this affidavit. For these purposes, a "disqualified
organization" means the United States, any state or political
subdivision thereof, any foreign government, any international
organization, any agency or instrumentality of any of the
foregoing (other than an instrumentality if all of its activities
are subject to tax and a majority of its board of directors is
not selected by such governmental entity), any cooperative
organization furnishing electric energy or providing telephone
service to persons in rural areas as described in Code
Section 1381(a)(2)(C), any "electing large partnership" within
the meaning of Section 775 of the Code, or any organization
(other than a farmers' cooperative described in Code Section 521)
that is exempt from federal income tax unless such organization
is subject to the tax on unrelated business income imposed by
Code Section 511.
4. That the Purchaser either (x) is not, and on __________________
[date of transfer] will not be, an employee benefit plan or other
retirement arrangement subject to Section 406 of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"), or
Section 4975 of the Code ("Code"), (collectively, a "Plan") or a
person acting on behalf of any such Plan or investing the assets
of any such Plan to acquire a Residual Certificate; (y) is an
insurance company that is purchasing the Certificate with funds
contained in an "insurance company general account" as defined in
Section V(e) of Prohibited Transaction Class Exemption ("PTCE")
95-60 and the purchase and holding of the Certificate satisfy the
requirements for exemptive relief under Sections I and III of
XXXX
X-0
95-60; or (z) herewith delivers to the Certificate Registrar
an opinion of counsel satisfactory to the Certificate Registrar
and the Securities Administrator and upon which the Certificate
Registrar, the Trustee, the Master Servicer, the Depositor and
Securities Administrator shall be entitled to rely, to the effect
that the purchase or holding of such Residual Certificate by the
Investor will not result in any non-exempt prohibited
transactions under Title I of ERISA or Section 4975 of the Code
and will not subject the Certificate Registrar, the Trustee, the
Depositor, the Master Servicer or the Securities Administrator to
any obligation in addition to those undertaken by such entities
in the Pooling and Servicing Agreement, which opinion of counsel
shall not be an expense of the Trust Fund or any of the above
parties.
5. That the Purchaser hereby acknowledges that under the terms of
the Pooling and Servicing Agreement, dated as of July 1, 2006
(the "Agreement"), by and among Xxxxxx Xxxxxxx Capital I Inc., as
Depositor, Xxxxx Fargo Bank, National Association, as Master
Servicer and as Administrator and LaSalle Bank National
Association, as Trustee with respect to Xxxxxx Xxxxxxx Mortgage
Loan Trust 2006-9AR, Mortgage Pass-Through Certificates, no
transfer of the Residual Certificates shall be permitted to be
made to any person unless the Certificate Registrar has received
a certificate from such transferee containing the representations
in paragraphs 3 and 4 hereof.
6. That the Purchaser does not hold REMIC residual securities as
nominee to facilitate the clearance and settlement of such
securities through electronic book-entry changes in accounts of
participating organizations (such entity, a "Book-Entry Nominee").
7. That the Purchaser does not have the intention to impede the
assessment or collection of any federal, state or local taxes
legally required to be paid with respect to such Residual
Certificate.
8. That the Purchaser will not transfer a Residual Certificate to
any person or entity (i) as to which the Purchaser has actual
knowledge that the requirements set forth in paragraph 3,
paragraph 6 or paragraph 10 hereof are not satisfied or that the
Purchaser has reason to believe does not satisfy the requirements
set forth in paragraph 7 hereof, and (ii) without obtaining from
the prospective Purchaser an affidavit substantially in this form
and providing to the Certificate Registrar a written statement
substantially in the form of Exhibit C to the Agreement.
9. That the Purchaser understands that, as the holder of a Residual
Certificate, the Purchaser may incur tax liabilities in excess of
any cash flows generated by the interest and that it intends to
pay taxes associated with holding such Residual Certificate as
they become due.
10. That the Purchaser (i) is not a Non-U.S. Person or (ii) is a
Non-U.S. Person that holds a Residual Certificate in connection
with the conduct of a trade or business within the United States
and has furnished the transferor the Certificate Registrar
B-2
with an effective Internal Revenue Service Form W-8ECI
(Certificate of Foreign Person's Claim for Exemption From
Withholding on Income Effectively Connected With the Conduct of
a Trade or Business in the United States) or successor form at
the time and in the manner required by the Code or (iii) is a
Non-U.S. Person that has delivered to the transferor, the
Trustee and the Certificate Registrar an opinion of a
nationally recognized tax counsel to the effect that the
transfer of such Residual Certificate to it is in accordance
with the requirements of the Code and the regulations
promulgated thereunder and that such transfer of a Residual
Certificate will not be disregarded for federal income tax
purposes. "Non-U.S. Person" means an individual, corporation,
partnership or other person other than (i) a citizen or
resident of the United States; (ii) a corporation, partnership
or other entity created or organized in or under the laws of
the United States or any state thereof, including for this
purpose, the District of Columbia; (iii) an estate that is
subject to U.S. federal income tax regardless of the source of
its income; (iv) a trust if a court within the United States is
able to exercise primary supervision over the administration of
the trust and one or more United States trustees have authority
to control all substantial decisions of the trust; and, (v) to
the extent provided in Treasury regulations, certain trusts in
existence on August 20, 1996 that are treated as United States
persons prior to such date and elect to continue to be treated
as United States persons.
11. The Purchaser will not cause income from the Residual Certificate
to be attributable to a foreign permanent establishment or fixed
base of the Purchaser or another U.S. taxpayer.
12. That the Purchaser agrees to such amendments of the Pooling and
Servicing Agreement as may be required to further effectuate the
restrictions on transfer of any Residual Certificate to such a
"disqualified organization," an agent thereof, a Book-Entry
Nominee, or a person that does not satisfy the requirements of
paragraph 7 and paragraph 10 hereof.
13. That the Purchaser consents to the designation of the Securities
Administrator to act as agent for the "tax matters person" of each
REMIC created by the Trust Fund pursuant to the Pooling and
Servicing Agreement.
B-3
IN WITNESS WHEREOF, the Purchaser has caused this instrument to be
executed on its behalf, pursuant to authority of its Board of Directors, by
its [title of officer] this ___ day of _______ 20__.
---------------------------------
[name of Purchaser]
By:
------------------------------------
Name:
Title:
Personally appeared before me the above-named [name of officer]
________________, known or proved to me to be the same person who executed the
foregoing instrument and to be the [title of officer] __________________ of the
Purchaser, and acknowledged to me that he [she] executed the same as his [her]
free act and deed and the free act and deed of the Purchaser.
Subscribed and sworn before me this __ day of ____________ 20__.
NOTARY PUBLIC
----------------------------
COUNTY OF
--------------------------
STATE OF
--------------------------
My commission expires the __ day of ____________________ 20__.
B-4
EXHIBIT C
FORM OF RESIDUAL CERTIFICATE TRANSFER AFFIDAVIT (TRANSFEROR)
----------------------------
Date
Re: Xxxxxx Xxxxxxx Mortgage Loan Trust 2006-9AR
Mortgage Pass-Through Certificates
___________________________ (the "Transferor") has reviewed the attached
affidavit of ___________________________________ (the "Transferee"), and has no
actual knowledge that such affidavit is not true and has no reason to believe
that the information contained in paragraph 7 thereof is not true, and has no
reason to believe that the Transferee has the intention to impede the
assessment or collection of any federal, state or local taxes legally required
to be paid with respect to a Residual Certificate. In addition, the Transferor
has conducted a reasonable investigation at the time of the transfer and found
that the Transferee had historically paid its debts as they came due and found
no significant evidence to indicate that the Transferee will not continue to
pay its debts as they become due.
Very truly yours,
------------------------------------------
Name:
Title:
C-1
EXHIBIT D
[RESERVED]
D-1
EXHIBIT E
LIST OF PURCHASE AND SERVICING AGREEMENTS
1. Second Amended and Restated Mortgage Loan Purchase and Warranties
Agreement, dated as of December 1, 2005, between American Home Mortgage Corp.,
as seller and Xxxxxx Xxxxxxx Mortgage Capital Inc., as purchaser;
2. Master Mortgage Loan Purchase and Warranties Agreement, dated as of January
20, 2005 between First National Bank of Nevada, as seller and Xxxxxx Xxxxxxx
Mortgage Capital Inc., as purchaser.
3. First Amended and Restated Servicing Agreement, dated as of January 1,
2006, between GMAC Mortgage Corporation, as servicer and Xxxxxx Xxxxxxx
Mortgage Capital Inc., as purchaser;
4. Mortgage Loan Sale and Servicing Agreement dated as of December 1, 2005,
between The Hemisphere National Bank, as seller and servicer and Xxxxxx
Xxxxxxx Mortgage Capital Inc., as purchaser;
5. Amended and Restated Mortgage Loan Purchase And Warranties Agreement, dated
as of May 1, 2005, between MortgageIT, Inc., as seller and Xxxxxx Xxxxxxx
Mortgage Capital Inc., as purchaser;
6. Seller's Purchase, Warranties and Servicing Agreement, dated as of
September 1, 2004, as supplemented by an Amended and Restated Regulation AB
Compliance Addendum dated as of April 17, 2006, each between Wachovia Mortgage
Corporation, as seller and servicer and Xxxxxx Xxxxxxx Mortgage Capital Inc.,
as purchaser.
E-1
EXHIBIT F
LIST OF CUSTODIAL AGREEMENTS
1. Custodial Agreement, dated as of July 1, 2006, by and among Xxxxxx Xxxxxxx
Mortgage Capital Inc, as purchaser, American Home Mortgage Corp., as seller,
American Home Mortgage Servicing, Inc., as servicer, The Hemisphere National
Bank, as servicer and seller, Xxxxxx Xxxxxxx Credit Corporation, as servicer
and seller, Wachovia Mortgage Corporation, as servicer and seller, Xxxxx Fargo
Bank, National Association, as master servicer and securities administrator,
LaSalle Bank National Association, as trustee, and JPMorgan Chase Bank,
National Association, as custodian.
F-1
EXHIBIT G
ASSIGNMENT AND NOTICE OF TRANSFER WITH RESPECT TO ADDITIONAL COLLATERAL
MORTGAGE LOANS
G-1
EXHIBIT H
FORM OF RULE 144A TRANSFER CERTIFICATE
Re: Xxxxxx Xxxxxxx Mortgage Loan Trust 2006-9AR,
Mortgage Pass-Through Certificates
Reference is hereby made to the Pooling and Servicing Agreement, dated
as of July 1, 2006 (the "Pooling and Servicing Agreement"), by and among
Xxxxxx Xxxxxxx Capital I Inc., as Depositor, Xxxxx Fargo Bank, National
Association, as Master Servicer, as Securities Administrator and, in its
capacity as Securities Administrator, as Auction Administrator, LaSalle Bank
National Association, as Trustee. Capitalized terms used but not defined
herein shall have the meanings given to them in the Pooling and Servicing
Agreement.
This letter relates to $________ initial Certificate Balance of Class
___ Certificates which are held in the form of Definitive Certificates
registered in the name of ______________ (the "Transferor"). The Transferor
has requested a transfer of such Definitive Certificates for Definitive
Certificates of such Class registered in the name of [insert name of
transferee].
In connection with such request, and in respect of such Certificates,
the Transferor hereby certifies that such Certificates are being transferred
in accordance with (i) the transfer restrictions set forth in the Pooling and
Servicing Agreement and the Certificates and (ii) Rule 144A under the
Securities Act to a purchaser that the Transferor reasonably believes is a
"qualified institutional buyer" within the meaning of Rule 144A purchasing for
its own account or for the account of a "qualified institutional buyer," which
purchaser is aware that the sale to it is being made in reliance upon Rule
144A, in a transaction meeting the requirements of Rule 144A and in accordance
with any applicable securities laws of any state of the United States or any
other applicable jurisdiction.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Underwriter, the Certificate Registrar and the
Depositor.
------------------------------------------
[Name of Transferor]
By:
------------------------------------
Name:
Title:
Dated:
--------------, ----
H-1
EXHIBIT I
FORM OF PURCHASER'S LETTER FOR
INSTITUTIONAL ACCREDITED INVESTOR
Date
Dear Sirs:
In connection with our proposed purchase of $_____________ principal
amount of Xxxxxx Xxxxxxx Mortgage Loan Trust 2006-9AR, Mortgage Pass-Through
Certificates (the "Privately Offered Certificates") of Xxxxxx Xxxxxxx Capital
I Inc. (the "Depositor"), we confirm that:
(1) We understand that the Privately Offered Certificates have not been, and
will not be, registered under the Securities Act of 1933, as amended
(the "Securities Act"), and may not be sold except as permitted in the
following sentence. We agree, on our own behalf and on behalf of any
accounts for which we are acting as hereinafter stated, that if we
should sell any Privately Offered Certificates within two years of the
later of the date of original issuance of the Privately Offered
Certificates or the last day on which such Privately Offered
Certificates are owned by the Depositor or any affiliate of the
Depositor we will do so only (A) to the Depositor, (B) to "qualified
institutional buyers" (within the meaning of Rule 144A under the
Securities Act) in accordance with Rule 144A under the Securities Act
("QIBs"), (C) pursuant to the exemption from registration provided by
Rule 144 under the Securities Act, or (D) to an institutional
"accredited investor" within the meaning of Rule 501(a)(1), (2), (3) or
(7) of Regulation D under the Securities Act that is not a QIB (an
"Institutional Accredited Investor") which, prior to such transfer,
delivers to the Certificate Registrar under the Pooling and Servicing
Agreement, dated as of July 1, 2006 (the "Pooling and Servicing
Agreement"), by and among Xxxxxx Xxxxxxx Capital I Inc., as Depositor,
Xxxxx Fargo Bank, National Association, as Master Servicer, as
Securities Administrator and, in its capacity as Securities
Administrator, as Auction Administrator and LaSalle Bank National
Association, as Trustee, a signed letter in the form of this letter; and
we further agree, in the capacities stated above, to provide to any
person purchasing any of the Privately Offered Certificates from us a
notice advising such purchaser that resales of the Privately Offered
Certificates are restricted as stated herein.
(2) We understand that, in connection with any proposed resale of any
Privately Offered Certificates to an Institutional Accredited Investor,
we will be required to furnish to the Certificate Registrar a
certification from such transferee in the form hereof to confirm that
the proposed sale is being made pursuant to an exemption from, or in a
transaction not subject to, the registration requirements of the
Securities Act. We further understand that the Privately Offered
Certificates purchased by us will bear a legend to the foregoing effect.
(3) We are acquiring the Privately Offered Certificates for investment
purposes and not with a view to, or for offer or sale in connection
with, any distribution in violation of the
I-1
Securities Act. We have such knowledge and experience in financial
and business matters as to be capable of evaluating the merits and
risks of our investment in the Privately Offered Certificates, and
we and any account for which we are acting are each able to bear the
economic risk of such investment.
(4) We are an Institutional Accredited Investor and we are acquiring the
Privately Offered Certificates purchased by us for our own account or
for one or more accounts (each of which is an Institutional Accredited
Investor) as to each of which we exercise sole investment discretion.
(5) We have received such information as we deem necessary in order to make
our investment decision.
(6) If we are acquiring ERISA-Restricted Certificates, we understand that in
accordance with ERISA, the Code and the Exemption, no Plan and no person
acting on behalf of such a Plan may acquire such Certificate except in
accordance with Section 3.03(d) of the Pooling and Servicing Agreement.
Terms used in this letter which are not otherwise defined herein have
the respective meanings assigned thereto in the Pooling and Servicing
Agreement.
I-2
You and the Certificate Registrar are entitled to rely upon this letter
and are irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceeding or official inquiry
with respect to the matters covered hereby.
Very truly yours,
----------------------------------------
[Purchaser]
By:
------------------------------------
Name:
Title:
I-3
EXHIBIT J
FORM OF ERISA TRANSFER AFFIDAVIT
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
The undersigned, being first duly sworn, deposes and says as follows:
1. The undersigned is the ________________ of ____________ (the
"Investor"), a [corporation duly organized] and existing under the laws of
________________, on behalf of which he makes this affidavit.
2. The Investor either (x) is not, and on ____________ [date of transfer]
will not be, an employee benefit plan or other plan or arrangement subject to
Section 406 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"), (collectively, a "Plan") or a person acting on behalf of any
such Plan or investing the assets of any such Plan; (y) if the Certificate has
been the subject of an ERISA-Qualifying Underwriting, is an insurance company
that is purchasing the Certificate with funds contained in an "insurance
company general account" as defined in Section V(e) of Prohibited Transaction
Class Exemption ("PTCE") 95-60 and the purchase and holding of the Certificate
satisfy the requirements for exemptive relief under Sections I and III of PTCE
95-60; or (z) herewith delivers to the Certificate Registrar an opinion of
counsel satisfactory to the Certificate Registrar and the Securities
Administrator and upon which the Certificate Registrar, the Trustee, the
Master Servicer, the Depositor and the Securities Administrator shall be
entitled to rely, to the effect that the purchase and holding of such
Certificate by the Investor will not constitute or result in any non-exempt
prohibited transactions under Title I of ERISA or Section 4975 of the Code and
will not subject the Certificate Registrar, the Trustee, the Master Servicer,
the Depositor or the Securities Administrator to any obligation in addition to
those undertaken by such entities in the Pooling and Servicing Agreement,
which opinion of counsel shall not be an expense of the Trust Fund or the
above parties.
3. The Investor hereby acknowledges that under the terms of the Pooling
and Servicing Agreement, dated as of July 1, 2006 (the "Pooling and Servicing
Agreement"), by and among Xxxxxx Xxxxxxx Capital I Inc., as Depositor, Xxxxx
Fargo Bank, National Association, as Master Servicer, as Securities
Administrator and, in its capacity as Securities Administrator, as Auction
Administrator and LaSalle Bank National Association, as Trustee, no transfer
of the ERISA-Restricted Certificates shall be permitted to be made to any
person unless the Certificate Registrar has received a certificate from such
transferee in the form hereof.
J-1
IN WITNESS WHEREOF, the Investor has caused this instrument to be
executed on its behalf, pursuant to proper authority, by its duly authorized
officer, duly attested, this _____ day of ______________________ 20__.
________________________________________
[Investor]
By: ____________________________________
Name:
Title:
ATTEST:
STATE OF )
) ss.:
COUNTY OF )
Personally appeared before me the above-named ________________, known or
proved to me to be the same person who executed the foregoing instrument and
to be the _________________________ of the Investor, and acknowledged that he
executed the same as his free act and deed and the free act and deed of the
Investor.
Subscribed and sworn before me this __ day of ____________ 20__.
________________________________
NOTARY PUBLIC
My commission expires the
_____ day of __________ 20___.
J-2
EXHIBIT K
FORM OF LETTER OF REPRESENTATIONS
WITH THE DEPOSITORY TRUST COMPANY
[On File with Securities Administrator]
K-1
EXHIBIT L-1
FORM OF INITIAL CUSTODIAL CERTIFICATION
May __, 2006
Xxxxxx Xxxxxxx Capital I Inc.
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxx Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxx Fargo Bank, National Association
0000 Xxx Xxxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
LaSalle Bank National Association, as Trustee
000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Trust Administration - MSM 2006-9AR
Re: Pooling and Servicing Agreement ("Pooling and Servicing
-------------------------------------------------------
Agreement") relating to Xxxxxx Xxxxxxx Mortgage Loan Trust
----------------------------------------------------------
2006-9AR, Mortgage Pass-Through Certificates, Series 2006-9AR
-------------------------------------------------------------
Ladies and Gentlemen:
In accordance with and subject to the provisions of Section 2.02 of the
Pooling and Servicing Agreement, the undersigned, as Custodian, hereby
certifies that, except for the exceptions noted on the schedule attached
hereto, (a) all documents required to be delivered to the Custodian pursuant
to Sections 2.01(a)(i) through (iv) and (ix)(b), (c) (solely to the extent of
the UCC-1), (g) and (h), and if delivered to it, the documents identified in
Section 2.01(a)(v) through (vii) and (ix)(c) (solely to the extent of the
UCC-3) and (f) of the Pooling and Servicing Agreement are in its possession,
(b) such documents have been reviewed by it and have not been mutilated,
damaged, defaced, torn or otherwise physically altered, and such documents
relate to such Mortgage Loan, (c) based on its review and examination and only
as to the foregoing documents, such documents appear regular on their face and
related to such Mortgage Loan and (d) each Mortgage Note has been endorsed and
each assignment of Mortgage has been delivered as provided in Section 2.01 of
the Pooling and Servicing Agreement. The Custodian has made no independent
examination of any documents contained in each Mortgage File beyond the review
specifically mentioned above. The Custodian makes no representations as to:
(i) the validity, legality, sufficiency, enforceability or genuineness of any
of the documents delivered in accordance with Section 2.01 of the Pooling and
Servicing Agreement or any of the Mortgage Loans identified in the Mortgage
Loan Schedule, or (ii) the collectibility, insurability, effectiveness or
suitability of any such Mortgage Loan.
L-1-1
The Custodian acknowledges receipt of notice that the Depositor has
granted to the Trustee for the benefit of the Certificateholders a security
interest in all of the Depositor's right, title and interest in and to the
Mortgage Loans.
L-1-2
Capitalized terms used herein without definition shall have the meaning
assigned to them in the Pooling and Servicing Agreement.
[LASALLE BANK NATIONAL ASSOCIATION, as
Custodian]
[JPMORGAN CHASE BANK, NATIONAL
ASSOCIATION, as Custodian]
[XXXXX FARGO BANK, NATIONAL ASSOCIATION,]
as Custodian
By:
---------------------------------
Authorized Representative
X-0-0
XXXXXXX X-0
FORM OF FINAL CUSTODIAL CERTIFICATION
May __, 2006
Xxxxxx Xxxxxxx Capital I Inc.
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxx Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxx Fargo Bank, National Association
0000 Xxx Xxxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
LaSalle Bank National Association, as Trustee
000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Trust Administration - MSM 2006-9AR
Re: Pooling and Servicing Agreement ("Pooling and Servicing
-------------------------------------------------------
Agreement") relating to Xxxxxx Xxxxxxx Mortgage Loan Trust
----------------------------------------------------------
2006-9AR, Mortgage Pass-Through Certificates, Series 2006-9AR
-------------------------------------------------------------
Ladies and Gentlemen:
In accordance with and subject to the provisions of Section 2.02 of the
Pooling and Servicing Agreement, the undersigned, as Custodian, hereby
certifies that, except for the exceptions noted on the schedule attached
hereto, (a) all documents required to be delivered to the Custodian pursuant
to Sections 2.01(a)(i) through (iv) and (ix)(b), (c) (solely to the extent of
the UCC-1), (g) and (h), and if delivered to it, the documents identified in
Section 2.01(a)(v) through (vii) and (ix)(c) (solely to the extent of the
UCC-3) and (f) of the Pooling and Servicing Agreement are in its possession,
(b) such documents have been reviewed by it and have not been mutilated,
damaged, defaced, torn or otherwise physically altered, and such documents
relate to such Mortgage Loan, (c) based on its examination and only as to the
foregoing documents, these documents with respect to each Mortgage Loan
accurately reflect the information contained in the Mortgage Note and Mortgage
and (d) each Mortgage Note has been endorsed and each assignment of Mortgage
has been delivered as provided in Section 2.01 of the Pooling and Servicing
Agreement. The Custodian has made no independent examination of any documents
contained in each Mortgage File beyond the review specifically mentioned
above. The Custodian makes no representations as to: (i) the validity,
legality, sufficiency, enforceability or genuineness of any of the documents
delivered in accordance with Section 2.01 of the Pooling and Servicing
Agreement or any of the Mortgage Loans identified in the Mortgage Loan
Schedule, or (ii) the collectibility, insurability, effectiveness or
suitability of any such Mortgage Loan.
L-2-1
The Custodian acknowledges receipt of notice that the Depositor has
granted to the Trustee for the benefit of the Certificateholders a security
interest in all of the Depositor's right, title and interest in and to the
Mortgage Loans.
L-2-2
Capitalized terms used herein without definition shall have the meaning
assigned to them in the Pooling and Servicing Agreement.
[LASALLE BANK NATIONAL ASSOCIATION, as
Custodian]
[JPMORGAN CHASE BANK, NATIONAL
ASSOCIATION, as Custodian]
[XXXXX FARGO BANK, NATIONAL ASSOCIATION,]
as Custodian
By: _______________________
Authorized Representative
L-2-3
EXHIBIT M
REQUEST FOR RELEASE OF DOCUMENTS
[Name and Address of appropriate Custodian]
Re: Pooling and Servicing Agreement ("Pooling and Servicing
-------------------------------------------------------
Agreement") relating to Xxxxxx Xxxxxxx Mortgage Loan Trust
----------------------------------------------------------
2006-9AR, Mortgage Pass-Through Certificates, Series
----------------------------------------------------
2006-9AR and Custodial Agreement relating to Xxxxxx Xxxxxxx
-----------------------------------------------------------
Mortgage Loan Trust 2006-9AR
----------------------------
In connection with the administration of the Mortgage Loans in the Trust
created by the above-captioned Pooling and Servicing Agreement and that are
held by you as Custodian pursuant to the above-captioned Custodial Agreement,
we request the release, and hereby acknowledge receipt, of the Mortgage File
for the Mortgage Loan described below, for the reason indicated.
Mortgage Loan Number:
Mortgagor Name, Address & Zip Code:
Reason for Requesting Documents (check one):
1. Mortgage Paid in Full
-----------
2. Foreclosure
-----------
3. Substitution
-----------
4. Other Liquidation (Repurchases, etc.)
-----------
5. Nonliquidation
-----------
Reason: ______________________
Address to which Custodian should
Deliver the Mortgage File:
---------------------------------------------
---------------------------------------------
---------------------------------------------
By:
------------------------------------------
(authorized signer)
Issuer:
--------------------------------------
Address:
-------------------------------------
-------------------------------------
M-1
Date:
-----------------------------------------------------------
Custodian
------------------------------------------------------
[insert name of appropriate Custodian]
Please acknowledge the execution of the above request by your signature and
date below:
------------------------------------
Signature
---------------------
Date
Documents returned to Custodian:
------------------------------------
Signature
---------------------
Date
M-2
EXHIBIT N-1
Additional Form 10-D Disclosure
-------------------------------------------------------------------------------
ADDITIONAL FORM 10-D DISCLOSURE
-------------------------------------------------------------------------------
Item on Form 10-D Responsible Party
-------------------------------------------------------------------------------
Item 1: Distribution and Pool
Performance Information
-------------------------------------------------------------------------------
Information included in the [Monthly Servicer, Master Servicer and
Statement] Securities Administrator
-------------------------------------------------------------------------------
Any information required by 1121 which Depositor
is NOT included on the [Monthly
Statement]
-------------------------------------------------------------------------------
Item 2: Legal Proceedings
Any legal proceeding pending against the
following entities or their
respective property, that is material
to Certificateholders, including any
proceedings known to be contemplated
by governmental authorities:
-------------------------------------------------------------------------------
o Issuing Entity (Trust Fund) Trustee, Master Servicer, Securities
Administrator and Depositor
-------------------------------------------------------------------------------
o Sponsor (Seller) Seller (if a party to the Pooling and
Servicing Agreement) or Depositor
-------------------------------------------------------------------------------
o Depositor Depositor
-------------------------------------------------------------------------------
o Trustee Trustee
-------------------------------------------------------------------------------
o Securities Administrator Securities Administrator
-------------------------------------------------------------------------------
o Master Servicer Master Servicer
-------------------------------------------------------------------------------
o Custodian Custodian
-------------------------------------------------------------------------------
o 1110(b) Originator Depositor
-------------------------------------------------------------------------------
o Any 1108(a)(2) Servicer (other than Servicer
the Master Servicer or Securities
Administrator)
-------------------------------------------------------------------------------
o Any other party contemplated by Depositor
1100(d)(1)
-------------------------------------------------------------------------------
Item 3: Sale of Securities and Use of (i) Depositor (with respect to the
Proceeds Closing Date) and (ii) Master Servicer
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
-------------------------------------------------------------------------------
N-1-1
-------------------------------------------------------------------------------
ADDITIONAL FORM 10-D DISCLOSURE
-------------------------------------------------------------------------------
Item on Form 10-D Responsible Party
-------------------------------------------------------------------------------
were not registered.
-------------------------------------------------------------------------------
Item 4: Defaults Upon Senior Securities Administrator and Trustee
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)
-------------------------------------------------------------------------------
Item 5: Submission of Matters to a Securities Administrator and
Vote of Security Holders Trustee
Information from Item 4 of Part II of
Form 10-Q
-------------------------------------------------------------------------------
Item 6: Significant Obligors of Pool Depositor
Assets
Item 1112(b) - Significant Obligor
Financial Information*
-------------------------------------------------------------------------------
*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.
-------------------------------------------------------------------------------
Item 7: Significant Enhancement
Provider Information
Item 1114(b)(2) - Credit Enhancement
Provider Financial Information*
-------------------------------------------------------------------------------
o Determining applicable disclosure Depositor
threshold
-------------------------------------------------------------------------------
o Requesting required financial Depositor
information (including any required
accountants' consent to the use
thereof) or effecting incorporation by
reference
-------------------------------------------------------------------------------
Item 1115(b) - Derivative Counterparty
Financial Information*
-------------------------------------------------------------------------------
o Determining current maximum probable Depositor
exposure
-------------------------------------------------------------------------------
o Determining current significance Depositor
percentage
-------------------------------------------------------------------------------
o Requesting required financial Depositor
information (including any required
accountants' consent to the use
thereof) or effecting incorporation by
reference
-------------------------------------------------------------------------------
*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.
-------------------------------------------------------------------------------
Item 8: Other Information Any responsible party for the
applicable Form 8-K Disclosure item
-------------------------------------------------------------------------------
N-1-2
-------------------------------------------------------------------------------
ADDITIONAL FORM 10-D DISCLOSURE
-------------------------------------------------------------------------------
Item on Form 10-D Responsible Party
-------------------------------------------------------------------------------
Disclose any information required to
be reported on Form 8-K during the
period covered by the Form 10-D but
not reported
-------------------------------------------------------------------------------
Item 9: Exhibits
-------------------------------------------------------------------------------
Monthly Statement to Certificateholders Securities Administrator
-------------------------------------------------------------------------------
Exhibits required by Item 601 of Depositor
Regulation S-K, such as material
agreements
-------------------------------------------------------------------------------
N-1-3
EXHIBIT N-2
Additional Form 10-K Disclosure
-------------------------------------------------------------------------------
ADDITIONAL FORM 10-K DISCLOSURE
-------------------------------------------------------------------------------
Item on Form 10-K Responsible Party
-------------------------------------------------------------------------------
Item 1B: Unresolved Staff Comments Depositor
-------------------------------------------------------------------------------
Item 9B: Other Information Any responsible party for
Disclose any information required to be disclosure items on Form 8K
reported on Form 8-K during the fourth
quarter covered by the Form 10-K but not
reported
-------------------------------------------------------------------------------
Item 15: Exhibits, Financial (i) As to agreements, Securities
Statement Schedules Administrator/Depositor and (ii) as
to financial statements, Reporting
Parties (as to themselves)
-------------------------------------------------------------------------------
Reg AB Item 1112(b): Significant
Obligors of Pool Assets
-------------------------------------------------------------------------------
Significant Obligor Financial Depositor
Information*
-------------------------------------------------------------------------------
*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.
-------------------------------------------------------------------------------
Reg AB Item 1114(b)(2): Credit
Enhancement Provider Financial
Information
-------------------------------------------------------------------------------
o Determining applicable disclosure Depositor
threshold
-------------------------------------------------------------------------------
o Requesting required financial Depositor
information (including any required
accountants' consent to the use thereof)
or effecting incorporation by reference
-------------------------------------------------------------------------------
*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.
-------------------------------------------------------------------------------
Reg AB Item 1115(b): Derivative
Counterparty Financial Information
-------------------------------------------------------------------------------
o Determining current maximum probable Depositor
exposure
-------------------------------------------------------------------------------
o Determining current significance Depositor
percentage
-------------------------------------------------------------------------------
o Requesting required financial Depositor
information (including any required
accountants' consent to the use thereof)
or effecting incorporation by reference
-------------------------------------------------------------------------------
*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.
-------------------------------------------------------------------------------
Reg AB Item 1117: Legal Proceedings
-------------------------------------------------------------------------------
N-2-1
-------------------------------------------------------------------------------
ADDITIONAL FORM 10-K DISCLOSURE
-------------------------------------------------------------------------------
Item on Form 10-K Responsible Party
-------------------------------------------------------------------------------
Any legal proceeding pending against the
following entities or their respective
property, that is material to
Certificateholders, including any
proceedings known to be contemplated by
governmental authorities:
-------------------------------------------------------------------------------
o Issuing Entity (Trust Fund) Trustee, Master Servicer, Securities
Administrator and Depositor
-------------------------------------------------------------------------------
o Sponsor (Seller) Seller (if a party to the Pooling and
Servicing Agreement) or Depositor
-------------------------------------------------------------------------------
o Depositor Depositor
-------------------------------------------------------------------------------
o Trustee Trustee
-------------------------------------------------------------------------------
o Securities Administrator Securities Administrator
-------------------------------------------------------------------------------
o Master Servicer Master Servicer
-------------------------------------------------------------------------------
o Custodian Custodian
-------------------------------------------------------------------------------
o 1110(b) Originator Depositor
-------------------------------------------------------------------------------
o Any 1108(a)(2) Servicer (other than Servicer
the Master Servicer or Securities
Administrator)
-------------------------------------------------------------------------------
o Any other party contemplated by Depositor
1100(d)(1)
-------------------------------------------------------------------------------
Reg AB Item 1119: Affiliations and
Relationships
-------------------------------------------------------------------------------
Whether (a) the Sponsor (Seller), Depositor as to (a)
Depositor or Issuing Entity is an Sponsor/Seller as to (a)
affiliate of the following parties, and
(b) to the extent known and material,
any of the following parties are
affiliated with one another:
-------------------------------------------------------------------------------
o Master Servicer Master Servicer
-------------------------------------------------------------------------------
o Securities Administrator Securities Administrator
-------------------------------------------------------------------------------
o Trustee Trustee
-------------------------------------------------------------------------------
o Any other 1108(a)(3) servicer Servicer
-------------------------------------------------------------------------------
o Any 1110 Originator Depositor/Sponsor
-------------------------------------------------------------------------------
o Any 1112(b) Significant Obligor Depositor/Sponsor
-------------------------------------------------------------------------------
o Any 1114 Credit Enhancement Provider Depositor/Sponsor
-------------------------------------------------------------------------------
o Any 1115 Derivate Counterparty Depositor/Sponsor
Provider
-------------------------------------------------------------------------------
o Any other 1101(d)(1) material party Depositor/Sponsor
-------------------------------------------------------------------------------
Whether there are any "outside the Depositor as to (a)
ordinary course business arrangements" Sponsor/Seller as to (a)
other than would be obtained in an arm's
length transaction between (a) the
Sponsor (Seller), Depositor or Issuing
Entity on the one hand, and (b) any of
the following parties (or their
affiliates) on the other hand, that
exist currently or within the past two
years and that are material to a
Certificateholder's understanding of the
Certificates:
-------------------------------------------------------------------------------
N-2-2
-------------------------------------------------------------------------------
ADDITIONAL FORM 10-K DISCLOSURE
-------------------------------------------------------------------------------
Item on Form 10-K Responsible Party
-------------------------------------------------------------------------------
o Master Servicer Master Servicer
-------------------------------------------------------------------------------
o Securities Administrator Securities Administrator
-------------------------------------------------------------------------------
o Trustee Trustee
-------------------------------------------------------------------------------
o Any other 1108(a)(3) servicer Servicer
-------------------------------------------------------------------------------
o Any 1110 Originator Depositor/Sponsor
-------------------------------------------------------------------------------
o Any 1112(b) Significant Obligor Depositor/Sponsor
-------------------------------------------------------------------------------
o Any 1114 Credit Enhancement Provider Depositor/Sponsor
-------------------------------------------------------------------------------
o Any 1115 Derivate Counterparty Depositor/Sponsor
Provider
-------------------------------------------------------------------------------
o Any other 1101(d)(1) material party Depositor/Sponsor
-------------------------------------------------------------------------------
Whether there are any specific Depositor as to (a)
relationships involving the transaction Sponsor/Seller as to (a)
or the pool assets between (a) the
Sponsor (Seller), Depositor or Issuing
Entity on the one hand, and (b) any of
the following parties (or their
affiliates) on the other hand, that
exist currently or within the past two
years and that are material:
-------------------------------------------------------------------------------
o Master Servicer Master Servicer
-------------------------------------------------------------------------------
o Securities Administrator Securities Administrator
-------------------------------------------------------------------------------
o Trustee Trustee
-------------------------------------------------------------------------------
o Any other 1108(a)(3) servicer Servicer
-------------------------------------------------------------------------------
o Any 1110 Originator Depositor/Sponsor
-------------------------------------------------------------------------------
o Any 1112(b) Significant Obligor Depositor/Sponsor
-------------------------------------------------------------------------------
o Any 1114 Credit Enhancement Provider Depositor/Sponsor
-------------------------------------------------------------------------------
o Any 1115 Derivate Counterparty Depositor/Sponsor
Provider
-------------------------------------------------------------------------------
o Any other 1101(d)(1) material party Depositor/Sponsor
-------------------------------------------------------------------------------
N-2-3
EXHIBIT N-3
Form 8-K Disclosure Information
-------------------------------------------------------------------------------
FORM 8-K DISCLOSURE INFORMATION
-------------------------------------------------------------------------------
Item on Form 8-K Responsible Party
-------------------------------------------------------------------------------
Item 1.01- Entry into a Material All parties (with respect to any
Definitive Agreement agreement entered into by such party)
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
-------------------------------------------------------------------------------
Item 1.02- Termination of a Material All parties (with respect to any
Definitive Agreement agreement entered into by such party)
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.
-------------------------------------------------------------------------------
Item 1.03- Bankruptcy or Receivership
Disclosure is required regarding the
bankruptcy or receivership, with respect
to any of the following:
-------------------------------------------------------------------------------
o Sponsor (Seller) Depositor/Sponsor (Seller)
-------------------------------------------------------------------------------
o Depositor Depositor
-------------------------------------------------------------------------------
o Master Servicer Master Servicer
-------------------------------------------------------------------------------
o Affiliated Servicer Servicer
-------------------------------------------------------------------------------
o Other Servicer servicing 20% or more Servicer
of the pool assets at the time
of the report
-------------------------------------------------------------------------------
o Other material servicers Servicer
-------------------------------------------------------------------------------
o Trustee Trustee
-------------------------------------------------------------------------------
o Securities Administrator Securities Administrator
-------------------------------------------------------------------------------
o Significant Obligor Depositor
-------------------------------------------------------------------------------
o Credit Enhancer (10% or more) Depositor
-------------------------------------------------------------------------------
o Derivative Counterparty Depositor
-------------------------------------------------------------------------------
o Custodian Custodian
-------------------------------------------------------------------------------
N-3-1
-------------------------------------------------------------------------------
FORM 8-K DISCLOSURE INFORMATION
-------------------------------------------------------------------------------
Item on Form 8-K Responsible Party
-------------------------------------------------------------------------------
Item 2.04- Triggering Events that Master Servicer/Securities
Accelerate or Increase a Direct Administrator/ Depositor (with
Financial Obligation or an Obligation respect to any agreement to which
under an Off-Balance Sheet Arrangement neither the Master Servicer nor the
Securities Administrator is a party)
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.
Disclosure will be made of events other
than waterfall triggers which are
disclosed in the monthly statements to
the certificateholders.
-------------------------------------------------------------------------------
Item 3.03- Material Modification to Securities Administrator
Rights of Security Holders
Disclosure is required of any material
modification to documents defining the
rights of Certificateholders, including
the Pooling and Servicing Agreement.
-------------------------------------------------------------------------------
Item 5.03- Amendments of Articles of Securities Administrator and Depositor
Incorporation or Bylaws; Change of
Fiscal Year
Disclosure is required of any amendment
"to the governing documents of the
issuing entity".
-------------------------------------------------------------------------------
Item 6.01- ABS Informational and Depositor
Computational Material
-------------------------------------------------------------------------------
Item 6.02- Change of Servicer or Master Servicer/Securities
Trustee Administrator/
Servicer/Depositor/Trustee (as to
itself)/Successor 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 or
trustee.
-------------------------------------------------------------------------------
Reg AB disclosure about any new servicer Servicer/Master Servicer/Depositor
or master servicer is also required.
-------------------------------------------------------------------------------
Reg AB disclosure about any new Trustee Successor Trustee
is also required.
-------------------------------------------------------------------------------
Item 6.03- Change in Credit Depositor/Securities Administrator/
Enhancement or External Support Trustee (to the extent action is
required by the Trustee in
connection with any amendment or
modification therewith)
Covers termination of any enhancement
action in manner other than by its
terms, the addition of an enhancement,
or a material change in the enhancement
provided. Applies to external
-------------------------------------------------------------------------------
N-3-2
-------------------------------------------------------------------------------
FORM 8-K DISCLOSURE INFORMATION
-------------------------------------------------------------------------------
Item on Form 8-K Responsible Party
-------------------------------------------------------------------------------
credit enhancements as well as
derivatives.
-------------------------------------------------------------------------------
Reg AB disclosure about any new Depositor
enhancement provider is also required.
-------------------------------------------------------------------------------
Item 6.04- Failure to Make a Required Securities Administrator/Trustee (to
Distribution the extent the Trustee has knowledge
thereof)/Depositor (to the extent the
Depositor has knowledge thereof)
-------------------------------------------------------------------------------
Item 6.05- Securities Act Updating Depositor
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.
-------------------------------------------------------------------------------
If there are any new servicers or Depositor
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.
-------------------------------------------------------------------------------
Item 7.01- Reg FD Disclosure All parties
-------------------------------------------------------------------------------
Item 8.01- Other Events Depositor
Any event, with respect to which
information is not otherwise called
for in Form 8-K, that the registrant
deems of importance to
certificateholders.
-------------------------------------------------------------------------------
Item 9.01- Financial Statements and Responsible party for
Exhibits reporting/disclosing the financial
statement or exhibit
-------------------------------------------------------------------------------
N-3-3
EXHIBIT O
[FORM OF]
SERVICING CRITERIA TO BE ADDRESSED IN
ASSESSMENT OF COMPLIANCE STATEMENT
The assessment of compliance to be delivered by each party listed below
shall address, at a minimum, the criteria identified as below as "Applicable
Servicing Criteria":
------------------------------------------------------------------------------------------ ----------------------
Applicable
Servicing Criteria/
Servicing Criteria Responsible Party
------------------------------------------------------------------------------------------ ----------------------
Reference Criteria
--------------------- -------------------------------------------------------------------- ----------------------
General Servicing Considerations
--------------------- ----------------------
1122(d)(1)(i) Policies and procedures are instituted to monitor any performance S, MS, SA
or other triggers and events of default in accordance with the
transaction agreements.
--------------------- ----------------------
1122(d)(1)(ii) If any material servicing activities are outsourced to third
parties, policies and procedures are instituted to monitor the
third party's performance and compliance with such servicing S, MS, SA
activities.
--------------------- ----------------------
1122(d)(1)(iii) Any requirements in the transaction agreements to
maintain a back-up servicer for the mortgage loans N/A
are maintained.
--------------------- ----------------------
1122(d)(1)(iv) A fidelity bond and errors and omissions policy is in effect on
the party participating in the servicing function throughout the
reporting period in the amount of coverage required by and S, MS, SA
otherwise in accordance with the terms of the transaction
agreements.
--------------------- ----------------------
Cash Collection and Administration
--------------------- ----------------------
1122(d)(2)(i) Payments on mortgage loans are deposited into the
appropriate custodial bank accounts and related bank
clearing accounts no more than two business days S, MS, SA
following receipt, or such other number of
days specified in the transaction agreements.
--------------------- ----------------------
1122(d)(2)(ii) Disbursements made via wire transfer on behalf of an
obligor or to an investor are made only by S, MS, SA
authorized personnel.
--------------------- ----------------------
1122(d)(2)(iii) Advances of funds or guarantees regarding collections, cash flows
or distributions, and any interest or other fees charged for such
advances, are made, reviewed and approved as specified in the S, MS
transaction agreements.
--------------------- ----------------------
O-1
------------------------------------------------------------------------------------------ ----------------------
Applicable
Servicing Criteria/
Servicing Criteria Responsible Party
------------------------------------------------------------------------------------------ ----------------------
Reference Criteria
--------------------- -------------------------------------------------------------------- ----------------------
1122(d)(2)(iv) The related accounts for the transaction, such as cash reserve S, MS, SA
accounts or accounts established as a form of
overcollateralization, are separately maintained (e.g., with
respect to commingling of cash) as set forth in the transaction
agreements.
--------------------- ----------------------
1122(d)(2)(v) Each custodial account is maintained at a federally insured S, MS, SA
depository institution as set forth in the transaction agreements.
For purposes of this criterion, "federally insured depository
institution" with respect to a foreign financial institution means
a foreign financial institution that meets the requirements of
Rule 13k-1(b)(1) of the Securities Exchange Act.
--------------------- ----------------------
1122(d)(2)(vi) Unissued checks are safeguarded so as to prevent unauthorized S, MS, SA
access.
--------------------- ----------------------
1122(d)(2)(vii) Reconciliations are prepared on a monthly basis for all
asset-backed securities related bank accounts, including custodial
accounts and related bank clearing accounts. These reconciliations
are (A) mathematically accurate; (B) prepared within 30 calendar
days after the bank statement cutoff date, or such other number of
days specified in the transaction agreements; (C) reviewed and S, MS, SA
approved by someone other than the person who prepared the
reconciliation; and (D) contain explanations for reconciling
items. These reconciling items are resolved within 90 calendar
days of their original identification, or such other number of
days specified in the transaction agreements.
--------------------- ----------------------
Investor Remittances and Reporting
--------------------- ----------------------
1122(d)(3)(i) Reports to investors, including those to be filed with the
Commission, are maintained in accordance with the transaction
agreements and applicable Commission requirements. Specifically,
such reports (A) are prepared in accordance with timeframes and
other terms set forth in the transaction agreements; (B) provide
information calculated in accordance with the terms specified in S, MS, SA
the transaction agreements; (C) are filed with the Commission as
required by its rules and regulations; and (D) agree with
investors' or the trustee's records as to the total unpaid
principal balance and number of mortgage loans serviced by the
Servicer.
--------------------- ----------------------
1122(d)(3)(ii) Amounts due to investors are allocated and remitted in accordance
with timeframes, distribution priority and other terms set forth S, MS, SA
in the transaction agreements.
--------------------- ----------------------
O-2
------------------------------------------------------------------------------------------ ----------------------
Applicable
Servicing Criteria/
Servicing Criteria Responsible Party
------------------------------------------------------------------------------------------ ----------------------
Reference Criteria
--------------------- -------------------------------------------------------------------- ----------------------
1122(d)(3)(iii) Disbursements made to an investor are posted within two business S, MS, SA
days to the Servicer's investor records, or such other number of
days specified in the transaction agreements.
--------------------- ----------------------
1122(d)(3)(iv) Amounts remitted to investors per the investor reports agree with
cancelled checks, or other form of payment, or custodial bank S, MS, SA
statements.
--------------------- ----------------------
Pool Asset Administration
--------------------- ----------------------
1122(d)(4)(i) Collateral or security on mortgage loans is maintained as required S, C
by the transaction agreements or related mortgage loan documents.
--------------------- ----------------------
1122(d)(4)(ii) Mortgage loan and related documents are safeguarded as required by S, C
the transaction agreements.
--------------------- ----------------------
1122(d)(4)(iii) Any additions, removals or substitutions to the asset pool are
made, reviewed and approved in accordance with any conditions or S
requirements in the transaction agreements.
--------------------- ----------------------
1122(d)(4)(iv) Payments on mortgage loans, including any payoffs, made in
accordance with the related mortgage loan documents are posted to
the Servicer's obligor records maintained no more than two
business days after receipt, or such other number of days S
specified in the transaction agreements, and allocated to
principal, interest or other items (e.g., escrow) in accordance
with the related mortgage loan documents.
--------------------- ----------------------
1122(d)(4)(v) The Servicer's records regarding the mortgage loans agree with the
Servicer's records with respect to an obligor's unpaid principal S
balance.
--------------------- ----------------------
1122(d)(4)(vi) Changes with respect to the terms or status of an obligor's
mortgage loans (e.g., loan modifications or re-agings) are made,
reviewed and approved by authorized personnel in accordance with S
the transaction agreements and related pool asset documents.
--------------------- ----------------------
1122(d)(4)(vii) Loss mitigation or recovery actions (e.g., forbearance plans,
modifications and deeds in lieu of foreclosure, foreclosures and
repossessions, as applicable) are initiated, conducted and S
concluded in accordance with the timeframes or other requirements
established by the transaction agreements.
--------------------- ----------------------
1122(d)(4)(viii) Records documenting collection efforts are maintained during the
period a mortgage loan is delinquent in accordance with the
transaction agreements. Such records are maintained on at least a
monthly basis, or such other period specified in the transaction
agreements, and describe the entity's activities in monitoring S
delinquent mortgage loans
--------------------- ----------------------
O-3
------------------------------------------------------------------------------------------ ----------------------
Applicable
Servicing Criteria/
Servicing Criteria Responsible Party
------------------------------------------------------------------------------------------ ----------------------
Reference Criteria
--------------------- -------------------------------------------------------------------- ----------------------
including, for example, phone calls, letters and payments
rescheduling plans in cases where delinquency is deemed
temporary (e.g., illness or unemployment).
--------------------- ----------------------
1122(d)(4)(ix) Adjustments to interest rates or rates of return for mortgage
loans with variable rates are computed based on the related S
mortgage loan documents.
--------------------- ----------------------
1122(d)(4)(x) Regarding any funds held in trust for an obligor (such as escrow
accounts): (A) such funds are analyzed, in accordance with the
obligor's mortgage loan documents, on at least an annual basis, or
such other period specified in the transaction agreements; (B)
interest on such funds is paid, or credited, to obligors in S
accordance with applicable mortgage loan documents and state laws;
and (C) such funds are returned to the obligor within 30 calendar
days of full repayment of the related mortgage loans, or such
other number of days specified in the transaction agreements.
--------------------- ----------------------
1122(d)(4)(xi) Payments made on behalf of an obligor (such as tax or insurance
payments) are made on or before the related penalty or expiration
dates, as indicated on the appropriate bills or notices for such
payments, provided that such support has been received by the S
servicer at least 30 calendar days prior to these dates, or such
other number of days specified in the transaction agreements.
--------------------- ----------------------
1122(d)(4)(xii) Any late payment penalties in connection with any payment to be
made on behalf of an obligor are paid from the servicer's funds
and not charged to the obligor, unless the late payment was due to S
the obligor's error or omission.
--------------------- ----------------------
1122(d)(4)(xiii) Disbursements made on behalf of an obligor are posted within two S
business days to the obligor's records maintained by the servicer,
or such other number of days specified in the transaction
agreements.
--------------------- ----------------------
1122(d)(4)(xiv) Delinquencies, charge-offs and uncollectible accounts are S, MS
recognized and recorded in accordance with the transaction
agreements.
--------------------- ----------------------
1122(d)(4)(xv) Any external enhancement or other support, identified in Item
1114(a)(1) through (3) or Item 1115 of Regulation AB, is SA
maintained as set forth in the transaction agreements.
--------------------- -------------------------------------------------------------------- ----------------------
--------------------- -------------------------------------------------------------------- ----------------------
O-4
[NAME OF REPORTING PARTY]
Date: __________________________
By: ____________________________
Name:
Title:
Key:
S = each Servicer
MS = Master Servicer
SA = Securities Administrator
C = Custodian
O-5
EXHIBIT P
Additional Disclosure Notification
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
[insert name and address of Depositor]
Attn: Corporate Trust Services - MSM 2006-9AR-SEC REPORT PROCESSING
RE: **Additional Form [ ] Disclosure**Required
Ladies and Gentlemen:
In accordance with Section [12.02(b)][12.03(b)][12.04(b)] of the Pooling
and Servicing Agreement, dated as of [ ] [ ], 2006, among [ ], as [ ], [ ], as
[ ], [ ], as [ ] and [ ], as [ ]. The Undersigned, as [ ], hereby notifies you
that certain events have come to our attention that [will][may] need to be
disclosed on Form [ ].
Description of Additional Form [ ] Disclosure:
------------------------------------------------
List of Any Attachments hereto to be included in the Additional Form [ ]
Disclosure:
Any inquiries related to this notification should be directed to [ ],
phone number: [ ]; email address: [ ].
[NAME OF PARTY]
as [role]
By: __________________
Name:
Title:
P-1
EXHIBIT Q
GLOSSARY of TERMS for STANDARD & POOR'S LEVELS(R) VERSION 5.7 FILE FORMAT
APPENDIX E - 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
-----------------------------------------------
---------------------------------------------------------------------------------------------------------------------
Category under
State/Jurisdiction Name of Anti-Predatory Lending Applicable Anti-
Law/Effective Date Predatory Lending Law
---------------------------------- ------------------------------------------------- --------------------------------
Arkansas Arkansas Home Loan Protection Act, Ark. Code High Cost Home Loan
Xxx. xx.xx. 00-00-000 et seq.
Effective July 16, 2003
---------------------------------- ------------------------------------------------- --------------------------------
Cleveland Heights, OH Ordinance No. 72-2003 (PSH), Mun. Code xx.xx. Covered Loan
757.01 et seq.
Effective June 2, 2003
---------------------------------- ------------------------------------------------- --------------------------------
Colorado Consumer Equity Protection, Colo. Stat. Xxx. Covered Loan
xx.xx. 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
---------------------------------- ------------------------------------------------- --------------------------------
Connecticut Connecticut Abusive Home Loan Lending Practices High Cost Home Loan
Act, Conn. Gen. Stat. xx.xx. 36a-746 et seq.
Effective October 1, 2001
---------------------------------- ------------------------------------------------- --------------------------------
District of Columbia Home Loan Protection Act, D.C. Code xx.xx. Covered Loan
26-1151.01 et seq.
Effective for loans closed on or after January
28, 2003
---------------------------------- ------------------------------------------------- --------------------------------
Florida Fair Lending Act, Fla. Stat. Xxx. xx.xx. High Cost Home Loan
494.0078 et seq.
---------------------------------- ------------------------------------------------- --------------------------------
Q-1
Standard & Poor's High Cost Loan Categorization
-----------------------------------------------
---------------------------------------------------------------------------------------------------------------------
Category under
State/Jurisdiction Name of Anti-Predatory Lending Applicable Anti-
Law/Effective Date Predatory Lending Law
---------------------------------- ------------------------------------------------- --------------------------------
Effective October 2, 2002
---------------------------------- ------------------------------------------------- --------------------------------
Georgia (Oct. 1, 2002 - Mar. 0, Xxxxxxx Xxxx Xxxxxxx Xxx, Xx. Code Xxx. xx.xx. High Cost Home Loan
2003) 7-6A-1 et seq.
Effective October 1, 2002 - March 6, 2003
---------------------------------- ------------------------------------------------- --------------------------------
Georgia as amended (Mar. 7, 0000 Xxxxxxx Xxxx Xxxxxxx Xxx, Xx. Code Xxx. xx.xx. High Cost Home Loan
- current) 7-6A-1 et seq.
Effective for loans closed on or after March
7, 2003
---------------------------------- ------------------------------------------------- --------------------------------
HOEPA Section 32 Home Ownership and Equity Protection Act of High Cost Loan
1994, 15 U.S.C. ss. 1639, 12 C.F.R. xx.xx.
226.32 and 226.34
Effective October 1, 1995, amendments October
1, 2002
---------------------------------- ------------------------------------------------- --------------------------------
Illinois High Risk Home Loan Act, Ill. Comp. Stat. tit. High Risk Home Loan
815, xx.xx. 137/5 et seq.
Effective January 1, 2004 (prior to this
date, regulations under Residential
Mortgage License Act effective from May 14,
2001)
---------------------------------- ------------------------------------------------- --------------------------------
Kansas Consumer Credit Code, Kan. Stat. Xxx. xx.xx. High Loan to Value Consumer
16a-1-101 et seq. Loan (id. ss. 16a-3-207) and;
--------------------------------
Sections 16a-1-301 and 16a-3-207 became High APR Consumer Loan (id. ss.
effective April 14, 1999; Section 16a-3-308a 16a-3-308a)
became effective July 1, 1999
---------------------------------- ------------------------------------------------- --------------------------------
Kentucky 2003 KY H.B. 000 - Xxxx Xxxx Xxxx Xxxx Xxx, Xx. High Cost Home Loan
Rev. Stat. xx.xx. 360.100 et seq.
Effective June 24, 2003
---------------------------------- ------------------------------------------------- --------------------------------
Maine Truth in Lending, Me. Rev. Stat. tit. 9-A, High Rate High Fee Mortgage
xx.xx. 8-101 et seq.
Effective September 29, 1995 and as amended
from time to time
---------------------------------- ------------------------------------------------- --------------------------------
Q-2
Standard & Poor's High Cost Loan Categorization
-----------------------------------------------
---------------------------------------------------------------------------------------------------------------------
Category under
State/Jurisdiction Name of Anti-Predatory Lending Applicable Anti-
Law/Effective Date Predatory Lending Law
---------------------------------- ------------------------------------------------- --------------------------------
Massachusetts Part 40 and Part 32, 209 C.M.R. xx.xx. 32.00 et High Cost Home Loan
seq. and 209 C.M.R. xx.xx. 40.01 et seq.
Effective March 22, 2001 and amended from
time to time
---------------------------------- ------------------------------------------------- --------------------------------
Nevada Assembly Xxxx No. 284, Nev. Rev. Stat. xx.xx. Home Loan
598D.010 et seq.
Effective October 1, 2003
---------------------------------- ------------------------------------------------- --------------------------------
New Jersey New Jersey Home Ownership Security Act of 2002, High Cost Home Loan
N.J. Rev. Stat. xx.xx. 46:10B-22 et seq.
Effective for loans closed on or after
November 27, 2003
---------------------------------- ------------------------------------------------- --------------------------------
New Mexico Home Loan Protection Act, N.M. Rev. Stat. High Cost Home Loan
xx.xx. 58-21A-1 et seq.
Effective as of January 1, 2004; Revised as of
February 26, 2004
---------------------------------- ------------------------------------------------- --------------------------------
New York N.Y. Banking Law Article 6-l High Cost Home Loan
Effective for applications made on or after
April 1, 2003
---------------------------------- ------------------------------------------------- --------------------------------
North Carolina Restrictions and Limitations on High Cost Home High Cost Home Loan
Loans, N.C. Gen. Stat. xx.xx. 24-1.1E et seq.
Effective July 1, 2000; amended October 1,
2003 (adding open-end lines of credit)
---------------------------------- ------------------------------------------------- --------------------------------
Ohio H.B. 386 (codified in various sections of the Covered Loan
Ohio Code), Ohio Rev. Code Xxx. xx.xx.
1349.25 et seq.
Effective May 24, 2002
---------------------------------- ------------------------------------------------- --------------------------------
Oklahoma Consumer Credit Code (codified in various Subsection 10 Mortgage
sections of Title 14A)
Effective July 1, 2000; amended effective
January 1, 2004
---------------------------------- ------------------------------------------------- --------------------------------
Q-3
Standard & Poor's High Cost Loan Categorization
-----------------------------------------------
---------------------------------------------------------------------------------------------------------------------
Category under
State/Jurisdiction Name of Anti-Predatory Lending Applicable Anti-
Law/Effective Date Predatory Lending Law
---------------------------------- ------------------------------------------------- --------------------------------
South Carolina South Carolina High Cost and Consumer Home High Cost Home Loan
Loans Act, S.C. Code Xxx. xx.xx. 37-23-10
et seq.
Effective for loans taken on or after January
1, 2004
---------------------------------- ------------------------------------------------- --------------------------------
West Virginia West Virginia Residential Mortgage Lender, West Virginia Mortgage Loan
Broker and Servicer Act, W. Va. Code Xxx. Act Loan
xx.xx. 31-17-1 et seq.
Effective June 5, 2002
---------------------------------- ------------------------------------------------- --------------------------------
Standard & Poor's Covered Loan Categorization
---------------------------------------------
---------------------------------------------------------------------------------------------------------------------
Category under
State/Jurisdiction Name of Anti-Predatory Lending Applicable Anti-
Law/Effective Date Predatory Lending Law
---------------------------------- ------------------------------------------------- --------------------------------
Georgia (Oct. 1, 2002 - Mar. 0, Xxxxxxx Xxxx Xxxxxxx Xxx, Xx. Code Xxx. xx.xx. Covered Loan
2003) 7-6A-1 et seq.
Effective October 1, 2002 - March 6, 2003
---------------------------------- ------------------------------------------------- --------------------------------
New Jersey New Jersey Home Ownership Security Act of 2002, Covered Home Loan
N.J. Rev. Stat. xx.xx. 46:10B-22 et seq.
Effective November 27, 2003 - July 5, 2004
---------------------------------- ------------------------------------------------- --------------------------------
Standard & Poor's Home Loan Categorization
------------------------------------------
---------------------------------------------------------------------------------------------------------------------
Category under
State/Jurisdiction Name of Anti-Predatory Lending Applicable Anti-
Law/Effective Date Predatory Lending Law
---------------------------------- ------------------------------------------------- --------------------------------
Georgia (Oct. 1, 2002 - Mar. 0, Xxxxxxx Xxxx Xxxxxxx Xxx, Xx. Code Xxx. xx.xx. Home Loan
2003) 7-6A-1 et seq.
Effective October 1, 2002 - March 6, 2003
---------------------------------- ------------------------------------------------- --------------------------------
Q-4
Standard & Poor's Home Loan Categorization
------------------------------------------
---------------------------------------------------------------------------------------------------------------------
Category under
State/Jurisdiction Name of Anti-Predatory Lending Applicable Anti-
Law/Effective Date Predatory Lending Law
---------------------------------- ------------------------------------------------- --------------------------------
New Jersey New Jersey Home Ownership Security Act of 2002, Home Loan
N.J. Rev. Stat. xx.xx. 46:10B-22 et seq.
Effective for loans closed on or after
November 27, 2003
---------------------------------- ------------------------------------------------- --------------------------------
New Mexico Home Loan Protection Act, N.M. Rev. Stat. Home Loan
xx.xx. 58-21A-1 et seq.
Effective as of January 1, 2004; Revised as of
February 26, 2004
---------------------------------- ------------------------------------------------- --------------------------------
North Carolina Restrictions and Limitations on High Cost Home Consumer Home Loan
Loans, N.C. Gen. Stat. xx.xx. 24-1.1E et seq.
Effective July 1, 2000; amended October 1,
2003 (adding open-end lines of credit)
---------------------------------- ------------------------------------------------- --------------------------------
South Carolina South Carolina High Cost and Consumer Home Consumer Home Loan
Loans Act, S.C. Code Xxx. xx.xx. 37-23-10 et
seq.
Effective for loans taken on or after January
1, 2004
---------------------------------- ------------------------------------------------- --------------------------------
Q-5
EXHIBIT R
FORM OF LOST NOTE AFFIDAVIT - LA SALLE AS CUSTODIAN
I, as _________________________ (title) of ________ (the "Custodian"),
am authorized to make this Lost Note Affidavit on behalf of __________. In
connection with the administration of the Mortgage Loans held by
_______________ as Custodian on behalf of ____________ ("____") or the Trust
of such mortgage loans, as the case may be (the "Investor"), I (hereinafter
called "Deponent"), being duly sworn, depose and say that:
Custodian's address is:
[CUSTODIAN'S Address]
Custodian previously delivered to the Investor a signed Trust Receipt
with respect to the Mortgage Note referred to below;
Such Mortgage Note was endorsed or sold to the Investor by
_________________________ pursuant to the terms and provisions of a
____________________ Agreement dated and effective as of _________ ______,
_______;
Such Mortgage Note is not outstanding pursuant to a Request for Release
of Documents;
Such Mortgage Note (hereinafter called the "Original") has been lost;
Deponent has made or has caused to be made diligent search for Original
and has been unable to find or recover same;
The Custodian was the Custodian of the Original at the time of loss; and
Deponent agrees that, if the Original should ever come into Custodian's
possession, custody or power, Custodian will immediately and without
consideration surrender Original to the Investor.
Attached hereto is a true and correct copy of the (i) Mortgage Note,
endorsed in blank by the Mortgagee, and (ii) [Mortgage][Deed of Trust] with
evidence of recording thereon which secures the Mortgage Note.
Deponent hereby agrees that the Custodian shall indemnify and hold
harmless the Purchaser, the Trust, the Servicer of the related Mortgage Loan
and their respective employees, officers, directors and agents against any
loss, liability or damage, including reasonable attorney's fees, resulting
from the unavailability of the Mortgage Note, including but not limited to any
loss, liability or damage arising from (i) any false statement contained in
this Lost Note Affidavit, (ii) any claim of any party that it has already
purchased a mortgage loan evidenced by the lost Mortgage 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 Mortgage Note,
(iv) the issuance of new instrument in lieu thereof and (v) any claim whether
or not based upon or arising from honoring or refusing to honor the Original
when presented by anyone (items (i)
R-1
through (iv) above are hereinafter referred to as the "Losses") and (b) if
required by any Rating Agency in connection with placing such lost Mortgage
Note into a securitization transaction, shall obtain a surety bond from an
insurer acceptable to the applicable Rating Agency in an amount acceptable to
such Rating Agency to cover any Losses with respect to such lost Mortgage
Note.
Capitalized terms used herein but not defined herein have the meanings
given them in the Custodial Agreement, dated as of July 1, 2006, between
Xxxxxx Xxxxxxx Mortgage Capital Inc. and the Custodian.
This Lost Note Affidavit is intended to be relied on by the Investor,
its successors, and assigns and _______________________ represents and
warrants that it has the authority to perform its obligations under this Lost
Note Affidavit.
IN WITNESS WHEREOF, the Custodian has caused this instrument to be
executed on its behalf, pursuant to authority of its Board of Directors, by
its [title of officer] this _____ day of __________ 20__.
---------------------------------
[LA SALLE BANK NATIONAL ASSOCIATION]
By:
------------------------------------
Name:
Title:
On this _________ day of _______________________, ____, before me
appeared ____________________________________________, to me personally known,
who being duly sworn did say that she/he is the ______________________________
of ______________________, and that said Lost Note Affidavit was signed and
sealed on behalf of such corporation and said _____________________________
acknowledged this instrument to be the free act and deed of said corporation.
Subscribed and sworn before me this _____ day of __________ 20__.
NOTARY PUBLIC
----------------------------
COUNTY OF ________________
STATE OF __________________
My commission expires the _____ day of __________ 20__.
Signature
R-2
Typed Name
R-3
SCHEDULE A
MORTGAGE LOAN SCHEDULE
[On File with the Trustee and the Securities Administrator]
SCH. A-1
SCHEDULE B
PRINCIPAL BALANCES SCHEDULE
[Attached to Prospectus Supplement, if applicable]
SCH. B-1
