Exhibit 4.1
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XXXXXXX XXXXX MORTGAGE INVESTORS, INC.,
Depositor
CREDIT-BASED ASSET SERVICING AND SECURITIZATION LLC,
Sponsor
XXXXXX LOAN SERVICING LP,
Servicer
and
JPMORGAN CHASE BANK, NATIONAL ASSOCIATION,
Trustee
POOLING AND SERVICING AGREEMENT
Dated as of January 1, 2006
Ownit Mortgage Loan Trust, Series 2006-1
Ownit Mortgage Loan Asset-Backed Certificates, Series 2006-1
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TABLE OF CONTENTS
PAGE
ARTICLE I ...........................................................................................5
DEFINITIONS ...........................................................................................5
Section 1.01 Defined Terms.....................................................................5
Section 1.02 Accounting.......................................................................49
ARTICLE II CONVEYANCE OF MORTGAGE LOANS; ORIGINAL ISSUANCE OF CERTIFICATES...........................50
Section 2.01 Conveyance of Mortgage Loans.....................................................50
Section 2.02 Acceptance by Trustee............................................................52
Section 2.03 Repurchase or Substitution of Mortgage Loans by the Sponsor......................53
Section 2.04 Representations and Warranties of the Sponsor with Respect to the
Mortgage Loans...................................................................56
Section 2.05 Representations, Warranties and Covenants of the Servicer........................56
Section 2.06 Representations and Warranties of the Depositor..................................58
Section 2.07 Issuance of Certificates and the Uncertificated Regular Interests................59
Section 2.08 Representations and Warranties of the Sponsor....................................60
Section 2.09 Covenants of the Sponsor.........................................................61
ARTICLE III ADMINISTRATION AND SERVICING OF THE TRUST FUND............................................62
Section 3.01 Servicer to Act as Servicer......................................................62
Section 3.02 Collection of Mortgage Loan Payments.............................................63
Section 3.03 Realization Upon Defaulted Mortgage Loans........................................64
Section 3.04 Collection Account and Distribution Account......................................65
Section 3.05 Permitted Withdrawals From the Collection Account................................66
Section 3.06 Establishment of Escrow Account; Deposits in Escrow Account......................67
Section 3.07 Permitted Withdrawals From Escrow Account........................................68
Section 3.08 Payment of Taxes, Insurance and Other Charges; Collections Thereunder............68
Section 3.09 Transfer of Accounts.............................................................69
Section 3.10 Maintenance of Hazard Insurance..................................................69
Section 3.11 Maintenance of Mortgage Impairment Insurance Policy..............................70
Section 3.12 Fidelity Bond, Errors and Omissions Insurance....................................70
Section 3.13 Title, Management and Disposition of REO Property and Certain Delinquent
Mortgage Loans...................................................................71
Section 3.14 Due-on-Sale Clauses; Assumption and Substitution Agreements......................72
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TABLE OF CONTENTS
(continued)
PAGE
Section 3.15 Notification of Adjustments......................................................73
Section 3.16 Optional Purchases of Mortgage Loans by Servicer.................................73
Section 3.17 Trustee to Cooperate; Release of Files...........................................74
Section 3.18 Servicing Compensation...........................................................75
Section 3.19 Annual Statement as to Compliance................................................75
Section 3.20 Reports on Assessment of Compliance and Attestation..............................76
Section 3.21 Access to Certain Documentation and Information Regarding the Mortgage
Loans............................................................................78
Section 3.22 Reserved.........................................................................78
Section 3.23 Obligations of the Servicer in Respect of Compensating Interest..................78
Section 3.24 Obligations of the Servicer in Respect of Mortgage Interest Rates and
Monthly Payments.................................................................78
Section 3.25 Investment of Funds in the Collection Account and the Distribution
Account..........................................................................79
Section 3.26 Liability of Servicer; Indemnification...........................................79
Section 3.27 Reports of Foreclosure and Abandonment of Mortgaged Properties...................80
Section 3.28 Protection of Assets.............................................................81
Section 3.29 Periodic Filings.................................................................81
Section 3.30 Advance Facility.................................................................83
ARTICLE IV FLOW OF FUNDS.............................................................................86
Section 4.01 Interest Distributions...........................................................86
Section 4.02 Distributions of Principal and Monthly Excess Cashflow Amounts...................87
Section 4.03 Allocation of Losses.............................................................96
Section 4.04 Method of Distribution...........................................................97
Section 4.05 Distributions on Book-Entry Certificates.........................................97
Section 4.06 Statements.......................................................................97
Section 4.07 Remittance Reports; Advances....................................................100
Section 4.08 REMIC Distributions.............................................................101
ARTICLE V THE CERTIFICATES.........................................................................104
Section 5.01 The Certificates................................................................104
Section 5.02 Registration of Transfer and Exchange of Certificates...........................105
Section 5.03 Mutilated, Destroyed, Lost or Stolen Certificates...............................110
Section 5.04 Persons Deemed Owners...........................................................111
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TABLE OF CONTENTS
(continued)
PAGE
Section 5.05 Appointment of Paying Agent.....................................................111
ARTICLE VI THE SPONSOR, THE SERVICER AND THE DEPOSITOR..............................................111
Section 6.01 Liability of the Sponsor, the Servicer and the Depositor........................111
Section 6.02 Merger or Consolidation of, or Assumption of the Obligations of, the
Sponsor, the Servicer or the Depositor..........................................111
Section 6.03 Limitation on Liability of the Servicer and Others..............................112
Section 6.04 Servicer Not to Resign..........................................................112
Section 6.05 Delegation of Duties............................................................113
ARTICLE VII DEFAULT..................................................................................113
Section 7.01 Servicer Events of Termination..................................................113
Section 7.02 Trustee to Act; Appointment of Successor........................................115
Section 7.03 Waiver of Defaults..............................................................116
Section 7.04 Notification to Certificateholders..............................................116
Section 7.05 Survivability of Servicer Liabilities...........................................116
ARTICLE VIII THE TRUSTEE..............................................................................117
Section 8.01 Duties of Trustee...............................................................117
Section 8.02 Certain Matters Affecting the Trustee...........................................118
Section 8.03 Trustee Not Liable for Certificates or Mortgage Loans...........................119
Section 8.04 Trustee May Own Certificates....................................................120
Section 8.05 Sponsor to Pay Trustee Fees and Expenses........................................120
Section 8.06 Eligibility Requirements for Trustee............................................121
Section 8.07 Resignation or Removal of Trustee...............................................121
Section 8.08 Successor Trustee...............................................................122
Section 8.09 Merger or Consolidation of Trustee..............................................122
Section 8.10 Appointment of Co-Trustee or Separate Trustee...................................122
Section 8.11 Limitation of Liability.........................................................123
Section 8.12 Trustee May Enforce Claims Without Possession of Certificates...................123
Section 8.13 Suits for Enforcement...........................................................124
Section 8.14 Waiver of Bond Requirement......................................................124
Section 8.15 Waiver of Inventory, Accounting and Appraisal Requirement.......................124
ARTICLE IX REMIC AND GRANTOR TRUST ADMINISTRATION...................................................124
Section 9.01 REMIC Administration............................................................124
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TABLE OF CONTENTS
(continued)
PAGE
Section 9.02 Prohibited Transactions and Activities..........................................127
Section 9.03 Indemnification with Respect to Certain Taxes and Loss of REMIC Status..........128
Section 9.04 REO Property....................................................................128
Section 9.05 Grantor Trust Administration....................................................129
ARTICLE X TERMINATION..............................................................................129
Section 10.01 Termination.....................................................................129
Section 10.02 Additional Termination Requirements.............................................130
ARTICLE XI MISCELLANEOUS PROVISIONS.................................................................131
Section 11.01 Amendment.......................................................................131
Section 11.02 Recordation of Agreement; Counterparts..........................................132
Section 11.03 Limitation on Rights of Certificateholders......................................133
Section 11.04 Governing Law; Jurisdiction.....................................................133
Section 11.05 Notices.........................................................................133
Section 11.06 Severability of Provisions......................................................134
Section 11.07 Article and Section References..................................................134
Section 11.08 Notice to the Rating Agencies...................................................134
Section 11.09 Further Assurances..............................................................135
Section 11.10 Benefits of Agreement...........................................................135
Section 11.11 Acts of Certificateholders......................................................135
Section 11.12 Compliance with Regulation AB...................................................136
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EXHIBITS:
Exhibit A-1 Form of Class AV Certificates
Exhibit A-2 Form of Class AF-1 Certificates
Exhibit A-3 Form of Class AF-2 Certificates
Exhibit A-4 Form of Class AF-3 Certificates
Exhibit A-5 Form of Class AF-4 Certificates
Exhibit B-1 Form of Class B-1 Certificates
Exhibit B-2-1 Form of Class B-2 Certificates (144A)
Exhibit B-2-2 Form of Class B-2 Certificates (Regulation S)
Exhibit B-3-1 Form of Class B-3 Certificates (144A)
Exhibit B-3-2 Form of Class B-3 Certificates (Regulation S)
Exhibit B-4-1 Form of Class B-4 Certificates (144A)
Exhibit B-4-2 Form of Class B-4 Certificates (Regulation S)
Exhibit B-5-1 Form of Class B-5 Certificates (144A)
Exhibit B-5-2 Form of Class B-5 Certificates (Regulation S)
Exhibit C-1-1 Form of Class R Certificate
Exhibit C-1-2 Form of Class R-X Certificates
Exhibit C-2 Form of Class M-1 Certificates
Exhibit C-3 Form of Class M-2 Certificates
Exhibit C-4 Form of Class M-3 Certificates
Exhibit C-5 Form of Class M-4 Certificates
Exhibit C-6 Form of Class M-5 Certificates
Exhibit C-7 Form of Class M-6 Certificates
Exhibit C-8 Form of Class N Certificates
Exhibit C-9 Form of Class X Certificates
Exhibit D-1 Mortgage Loan Schedule for Group I Mortgage Loans
Exhibit D-2 Mortgage Loan Schedule for Group II Mortgage Loans
Exhibit E Form of Request for Release of Documents
Exhibit F-1 Form of Custodian's Initial Certification
Exhibit F-2 Form of Custodian's Final Certification
Exhibit F-3 Form of Receipt of Mortgage Note
Exhibit G Mortgage Loan Purchase Agreement
Exhibit H Form of Lost Note Affidavit
Exhibit I Form of ERISA Representation
Exhibit J Forms of Investment Letters
Exhibit K Form of Residual Certificate Transfer Affidavit
Exhibit L Form of Transferor Certificate
Exhibit M Monthly Information Provided by Servicer
Exhibit N-1 Form of Group I Senior Cap Contract
Exhibit N-2 Form of Mezzanine Cap Contract
Exhibit O Form of Power of Attorney
Exhibit P-1 Form of 1122(d) Servicing Criteria Letter
Exhibit P-2 Servicing Criteria (Exhibit A to Form of Assessment
of Compliance)
Exhibit P-3 Form of Xxxxxxxx-Xxxxx Certification (Servicer)
Exhibit P-4 Form of Item 1123 Certification (Servicer)
Exhibit P-5 Form of Officer's Certificate (Trustee)
Exhibit Q Form of Officer's Certificate with Respect to
Prepayments
Exhibit R Form 8-K Disclosure
Exhibit S Form 10-D Disclosure
Exhibit T Form 10-K Disclosure
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This Pooling and Servicing Agreement is dated as of January 1, 2006
(the "Agreement"), among XXXXXXX XXXXX MORTGAGE INVESTORS, INC., as depositor
(the "Depositor"), CREDIT-BASED ASSET SERVICING AND SECURITIZATION LLC, as
sponsor (the "Sponsor"), XXXXXX LOAN SERVICING LP, as servicer (the "Servicer")
and JPMORGAN CHASE BANK, NATIONAL ASSOCIATION, as trustee (the "Trustee").
PRELIMINARY STATEMENT
The Depositor intends to sell pass-through certificates (collectively,
the "Certificates"), to be issued hereunder in multiple Classes, which in the
aggregate will evidence the entire beneficial ownership interest in the Trust
Fund created hereunder. The Certificates will consist of twenty Classes of
Certificates, designated as (i) the Class AV and Class AF Certificates, (ii) the
Class M-1, Class M-2, Class M-3, Class M-4, Class M-5 and Class M-6
Certificates, (iii) the Class B-1, Class B-2, Class B-3, Class B-4 and Class B-5
Certificates, (iv) the Class N Certificates, (v) the Class X Certificates, (vi)
the Class R Certificates and the Class R-X Certificates.
As provided herein, the Trustee shall elect that the Trust Fund (other
than the Cap Contracts, the Reserve Account and the Grantor Trust) be treated
for federal income tax purposes as seven separate real estate mortgage
investment conduits (each a "REMIC" or, in the alternative, "REMIC 1," "REMIC
2," "REMIC B-2," "REMIC B-3," "REMIC B-4," "REMIC B-5" and "REMIC X/N"
respectively). The REMIC X/N Regular Interests represent all of the "regular
interests" in REMIC X/N. The REMIC B-5 Regular Interests represent all of the
"regular interests" in REMIC B-5. The REMIC B-4 Regular Interests represent all
of the "regular interests" in REMIC B-4. The REMIC B-3 Regular Interests
represent all of the "regular interests" in REMIC B-3. The REMIC B-2 Regular
Interests represent all of the "regular interests" in REMIC B-2. The REMIC 2
Regular Interests represent all of the "regular interests" in REMIC 2. The REMIC
1 Regular Interests represent all of the "regular interests" in REMIC 1. Each
Class of Cap Carryover Certificates (other than the Class B-2, Class B-3, Class
B-4 and Class B-5 Certificates) represents beneficial ownership of the
Corresponding REMIC 2 Regular Interest and the right to receive Net WAC
Carryover Amounts. The Class B-2 Certificates represent beneficial ownership of
the REMIC B-2 Regular Interest and the right to receive Net WAC Carryover
Amounts. The Class B-3 Certificates represent beneficial ownership of the REMIC
B-3 Regular Interest and the right to receive Net WAC Carryover Amounts. The
Class B-4 Certificates represent beneficial ownership of the REMIC B-4 Regular
Interest and the right to receive Net WAC Carryover Amounts. The Class B-5
Certificates represent beneficial ownership of the REMIC B-5 Regular Interest
and the right to receive Net WAC Carryover Amounts.
For federal income tax purposes, the Class N and Class X Certificates
together represent beneficial ownership of the REMIC X/N X/N Interest subject to
the obligation to pay Net WAC Carryover Amounts (other than Net WAC Carryover
Amounts funded from the Reserve Account). Each of the Class R-1 and Class R-2
Interests, represented collectively by the Class R Certificates, represents the
sole Class of "residual interest" in REMIC 1 and REMIC 2, respectively, for
purposes of the REMIC Provisions. Each of the Class R-B-2, Class R-B-3, Class
R-B-4, Class R-B-5 and Class R-X/N Interests, represented collectively by the
Class R-X Certificates, represent the sole Class of "residual interest" in REMIC
B-2, REMIC B-3, REMIC B-4, REMIC B-5 and REMIC X/N, respectively, for purposes
of the REMIC provisions. The REMIC 1 Regular Interests will be held as assets of
REMIC 2. The REMIC 2 X/N Interest will be held as the sole asset of REMIC X/N.
For federal income tax purposes, the REMIC X/N X/N Interest will be held as the
asset of the Grantor Trust. The REMIC 2 B-2 Interest will be held as the sole
asset of REMIC B-2. The REMIC 2 B-3 Interest will be held as the sole asset of
REMIC B-3. The REMIC 2 B-4 Interest will be held as the sole asset of REMIC B-4.
The REMIC 2 B-5 Interest will be held as the sole asset of REMIC B-5. The
"latest possible maturity date" for federal income tax purposes of all interests
created hereby will be the Distribution Date in January 2036.
REMIC 1
The following table specifies the class designation, interest rate and
initial principal amount for each class of REMIC 1 Interests.
Related Loan Group or
Designation Interest Rate Initial Principal Amount Related Certificate
----------- ------------- ------------------------ -------------------
LT1-AV (1) (5) Class AV
LT1-AF1 (1) (5) Class AF-1
LT1-AF2 (1) (5) Class AF-2
LT1-AF3 (1) (5) Class AF-3
LT1-AF4 (1) (5) Class AF-4
LT1-M1 (1) (5) Class M-1
LT1-M2 (1) (5) Class M-2
LT1-M3 (1) (5) Class M-3
LT1-M4 (1) (5) Class M-4
LT1-M5 (1) (5) Class M-5
LT1-M6 (1) (5) Class M-6
LT1-B1 (1) (5) Class B-1
LT1-B2 (1) (5) Class B-2
LT1-B3 (1) (5) Class B-3
LT1-B4 (1) (5) Class B-4
LT1-B5 (1) (5) Class B-5
LT1-X1 (1) (6) N/A
LT1-IA (1) (7) Loan Group I
LT1-IB (2) (8) Loan Group I
LT1-IIA (1) (7) Loan Group II
LT1-IIB (3) (8) Loan Group II
LT1-X2 (1) (9) N/A
R-1 (4) (4) N/A
---------------------
(1) For any Distribution Date, the interest rate for these interests shall
be the Net Rate.
(2) For any Distribution Date, the interest rate for the LT1-IB Interest
shall be a per annum rate equal to the Group I Net Rate.
(3) For any Distribution Date, the interest rate for the LT1-IIB Interest
shall be a per annum rate equal to the Group II Net Rate.
(4) The Class R-1 Interest shall represent the sole class of residual
interest in REMIC 1. The Class R-1 Interest will not have a principal
amount or an interest rate. The Class R-1 Interest shall be represented
by the Class R Certificate.
(5) The initial principal amount of these interests shall be an amount
equal to 25% of the initial principal amount of the related
certificates.
(6) The initial principal amount of this interest shall be an amount equal
to the excess of (i) 50% of the aggregate Cut-off Date Principal
Balance of the Mortgage Loans over (ii) the aggregate initial principal
amount of the Marker Interests.
2
(7) The initial principal amount of these interests shall be an amount
equal to 0.005% of the Group Subordinate Amount of the related Loan
Group as of the first Distribution Date.
(8) The initial principal amount of these interests shall be an amount
equal to 0.005% of the aggregate Cut-off Date Principal Balance of the
related Loan Group.
(9) The initial principal amount of this interest shall be an amount equal
to the excess of (i) 50% of the aggregate Cut-off date Principal
Balance of the Mortgage Loans over (ii) the aggregate initial principal
amount of the Class LT1-IA Interest, Class LT1-IB Interest, Class
LT1-IIA Interest and Class LT1-IIB Interest.
All computations with respect to any REMIC 1 Interest shall be taken
out to ten decimal places.
REMIC 2
The sole assets of REMIC 2 shall be the REMIC 1 Regular Interests. The
regular interests in REMIC 2 shall be the REMIC 2 Regular Interests. The
residual interest in REMIC 2 will be the Class R-2 Interest, which will be
represented by the Class R Certificate.
REMIC B-2
The sole asset of REMIC B-2 shall be the REMIC 2 B-2 Interest. The sole
regular interest in REMIC B-2 will be the REMIC B-2 B-2 Interest. The residual
interest in REMIC B-2 will be the Class R-B-2 Interest, which will be
represented by the Class R-X Certificate.
REMIC B-3
The sole asset of REMIC B-3 shall be the REMIC 2 B-3 Interest. The sole
regular interest in REMIC B-3 will be the REMIC B-3 B-3 Interest. The residual
interest in REMIC B-3 will be the Class R-B-3 Interest, which will be
represented by the Class R-X Certificate.
REMIC B-4
The sole asset of REMIC B-4 shall be the REMIC 2 B-4 Interest. The sole
regular interest in REMIC B-4 will be the REMIC B-4 B-4 Interest. The residual
interest in REMIC B-4 will be the Class R-B-4 Interest, which will be
represented by the Class R-X Certificate.
REMIC B-5
The sole asset of REMIC B-5 shall be the REMIC 2 B-5 Interest. The sole
regular interest in REMIC B-5 will be the REMIC B-5 B-5 Interest. The residual
interest in REMIC B-5 will be the Class R-B-5 Interest, which will be
represented by the Class R-X Certificate.
REMIC X/N
The sole asset of REMIC X/N shall be the REMIC 2 X/N Interest. The sole
regular interest in REMIC X/N will be the REMIC X/N X/N Interest. The residual
interest in REMIC X/N will be the Class R- X/N Interest, which will be
represented by the Class R-X Certificate.
3
The following table sets forth (or describes) the Class designation,
Pass-Through Rate and Original Class Certificate Principal Balance or Original
Notional Amount, for each Class of Certificates comprising the interests in the
Trust Fund created hereunder:
Original Class
Certificate
Principal Balance or Notional Pass-Through Final
Class Amount Rate Maturity Dates
----- ----------------------------- ------------ -----------------
AV $225,112,000 (1) December 25, 2036
AF-1 $182,384,000 (2) December 25, 2036
AF-2 $112,503,000 (3) December 25, 2036
AF-3 $8,503,000 (4) December 25, 2036
AF-4 $33,732,000 (5) December 25, 2036
M-1 $23,924,000 (6) December 25, 2036
M-2 $23,199,000 (7) December 25, 2036
M-3 $14,137,000 (8) December 25, 2036
M-4 $12,687,000 (9) December 25, 2036
M-5 $12,687,000 (10) December 25, 2036
M-6 $12,324,000 (11) December 25, 2036
B-1 $13,774,000 (12) December 25, 2036
B-2 $11,599,000 (13) December 25, 2036
B-3 $7,612,000 (14) December 25, 2036
B-4 $6,887,000 (15) December 25, 2036
B-5 $7,249,000 (16) December 25, 2036
N $13,000,000 (17) 6.500% N/A
X N/A (17) N/A N/A
R N/A N/A N/A
R-X N/A N/A N/A
Total (18)
(1) Interest will accrue on the Class AV Certificates during each Interest
Accrual Period at a rate equal to the Class AV Pass-Through Rate.
(2) Interest will accrue on the Class AF-1 Certificates during each
Interest Accrual Period at a rate equal to the Class AF-1 Pass-Through
Rate.
(3) Interest will accrue on the Class AF-2 Certificates during each
Interest Accrual Period at a rate equal to the Class AF-2 Pass-Through
Rate.
(4) Interest will accrue on the Class AF-3 Certificates during each
Interest Accrual Period at a rate equal to the Class AF-3 Pass-Through
Rate.
(5) Interest will accrue on the Class AF-4 Certificates during each
Interest Accrual Period at a rate equal the Class AF-4 Pass-Through
Rate.
(6) Interest will accrue on the Class M-1 Certificates during each Interest
Accrual Period at a rate equal the Class M-1 Pass-Through Rate.
(7) Interest will accrue on the Class M-2 Certificates during each Interest
Accrual Period at a rate equal to the Class M-2 Pass-Through Rate.
(8) Interest will accrue on the Class M-3 Certificates during each Interest
Accrual Period at a rate equal to the Class M-3 Pass-Through Rate.
(9) Interest will accrue on the Class M-4 Certificates during each Interest
Accrual Period at a rate equal to the Class M-4 Pass-Through Rate.
(10) Interest will accrue on the Class M-5 Certificates during each Interest
Accrual Period at a rate equal to the Class M-5 Pass-Through Rate.
4
(11) Interest will accrue on the Class M-6 Certificates during each Interest
Accrual Period at a rate equal to the Class M-6 Pass-Through Rate.
(12) Interest will accrue on the Class B-1 Certificates during each Interest
Accrual Period at a rate equal to the Class B-1 Pass-Through Rate.
(13) Interest will accrue on the Class B-2 Certificates during each Interest
Accrual Period at a rate equal to the Class B-2 Pass-Through Rate.
(14) Interest will accrue on the Class B-3 Certificates during each Interest
Accrual Period at a rate equal to the Class B-3 Pass-Through Rate.
(15) Interest will accrue on the Class B-4 Certificates during each Interest
Accrual Period at a rate equal to the Class B-4 Pass-Through Rate.
(16) Interest will accrue on the Class B-5 Certificates during each Interest
Accrual Period at a rate equal to the Class B-5 Pass-Through Rate.
(17) The Class N and Class X Certificates, collectively, represent the
beneficial ownership of the REMIC X/N X/N Interest, subject to the
obligation to make payments in respect of Net WAC Carryover Amounts
(other than Net WAC Carryover Amounts funded from the Reserve Account).
(18) Exclusive of the Class N Notional Amount. The Class N Original
Notional Amount is $13,000,000.
ARTICLE I
DEFINITIONS
Section 1.01 Defined Terms.
Whenever used in this Agreement or in the Preliminary Statement, the
following words and phrases, unless the context otherwise requires, shall have
the meanings specified in this Article. Interest on the Class AF, Class B, Class
N and Class X Certificates and the REMIC 1 Regular Interests and the REMIC 2 X/N
Interest will be calculated on the basis of a 360-day year consisting of twelve
30-day months. Unless otherwise specified, interest on the Class AV and Class M
Certificates will be calculated on the basis of the actual number of days in the
related Interest Accrual Period and a 360-day year.
"1933 Act": The Securities Act of 1933, as amended.
"60+ Day Delinquent Loan": With respect to any date of determination,
each Mortgage Loan with respect to which any portion of a Monthly Payment is, as
of the last day of the prior Collection Period, two months or more past due,
each Mortgage Loan in foreclosure, all REO Property and each Mortgage Loan for
which the Mortgagor has filed for bankruptcy after the Closing Date.
"Account": Any of the Collection Account, the Distribution Account, the
Escrow Account and the Reserve Account.
"Accountant's Attestation": As defined in Section 3.21.
"Accrued Certificate Interest": With respect to each Distribution Date
and Class of Certificates, an amount equal to the interest accrued at the
applicable rate set forth or described for such Class in the table in the
Preliminary Statement during the related Interest Accrual Period on the
Certificate Principal Balance or Notional Amount of such Class of Certificates,
reduced by such Class's Interest Percentage of Relief Act Interest Shortfalls
for such Distribution Date.
5
"Adjustment Date": With respect to each adjustable rate Mortgage Loan,
each adjustment date, on which the Mortgage Interest Rate of an adjustable rate
Mortgage Loan changes pursuant to the related Mortgage Note. The first
Adjustment Date following the Cut-off Date as to each adjustable rate Mortgage
Loan is set forth in the Mortgage Loan Schedule for the Mortgage Loans.
"Adjustment Period": As defined in the Preliminary Statement.
"Advance": As to any Mortgage Loan or REO Property, any advance made by
the Servicer in respect of any Distribution Date pursuant to Section 4.07.
"Advance Facility": As defined in Section 3.30(a) hereof.
"Advance Facility Notice": As defined in Section 3.30(b) hereof.
"Advance Financing Person": As defined in Section 3.30(a) hereof.
"Advance Reimbursement Amounts": As defined in Section 3.30(b) hereof.
"Adverse REMIC Event": As defined in Section 9.01(f) hereof.
"Affiliate": With respect to any Person, any other Person controlling,
controlled by or under common control with such Person. For purposes of this
definition, "control" means the power to direct the management and policies of a
Person, directly or indirectly, whether through ownership of voting securities,
by contract or otherwise and "controlling" and "controlled" shall have meanings
correlative to the foregoing.
"Agreement": This Pooling and Servicing Agreement and all amendments
and supplements hereto.
"Applicable Regulations": As to any Mortgage Loan, all federal, state
and local laws, statutes, rules and regulations applicable thereto, including
with respect to each FHA Loan, the FHA Regulations and the related FHA Insurance
Contract and with respect to each VA Loan, the VA Regulations and the related VA
Guaranty.
"Applied Realized Loss Amount": With respect to each Distribution Date,
the excess, if any, of (a) the aggregate of the Certificate Principal Balances
of the Certificates (after giving effect to all distributions on such
Distribution Date) over (b) the Pool Balance as of the end of the related
Collection Period.
"Assessment of Compliance": As defined in Section 3.21.
"Assignment": An assignment of Mortgage, notice of transfer or
equivalent instrument, in recordable form, which is sufficient under the laws of
the jurisdiction wherein the related Mortgaged Property is located to reflect or
record the sale of the Mortgage.
"Available Funds": As to any Distribution Date, an amount equal to the
excess of (i) the sum of (a) the aggregate of the Monthly Payments due during
the related Collection Period and received by the Servicer on or prior to the
related Determination Date, (b) Liquidation Proceeds, Insurance Proceeds,
Condemnation Proceeds, Principal Prepayments, Substitution Adjustment Amounts,
the Purchase Price for any repurchased Mortgage Loan, the Termination Price with
respect to the termination of the Trust pursuant to Section 10.01 hereof, any
Reimbursement Amount or Subsequent Recovery deposited to the Collection Account
and other unscheduled recoveries of principal and interest (excluding prepayment
penalties) in respect of the Mortgage Loans during the related Prepayment
Period, (c) the aggregate of any amounts received in respect of an REO Property
withdrawn from any REO Account and deposited in the Collection Account for such
Distribution Date, (d) any Compensating Interest for such Distribution Date, and
(e) the aggregate of any Advances made by the Servicer for such Distribution
Date over (ii) the sum of (a) amounts reimbursable or payable to the Servicer
pursuant to Section 3.05, (b) Stayed Funds, (c) the Servicing Fee, (d) expenses
reimbursable pursuant to Section 6.03 and fees, expenses and indemnities due
pursuant to Section 8.05 and (d) amounts deposited in the Collection Account or
the Distribution Account, as the case may be, in error.
6
"Balloon Mortgage Loan": A Mortgage Loan that provides for the payment
of the unamortized principal balance of such Mortgage Loan in a single payment
at the maturity of such Mortgage Loan that is substantially greater than the
preceding monthly payment.
"Balloon Payment": A payment of the unamortized principal balance of a
Mortgage Loan in a single payment at the maturity of such Mortgage Loan that is
substantially greater than the preceding Monthly Payment.
"Bankruptcy Code": Title 11 of the United States Code, as amended.
"Book-Entry Certificates": Any of the Certificates that shall be
registered in the name of the Depository or its nominee, the ownership of which
is reflected on the books of the Depository or on the books of a Person
maintaining an account with the Depository (directly, as a "Depository
Participant," or indirectly, as an indirect participant in accordance with the
rules of the Depository and as described in Section 5.02 hereof). On the Closing
Date, the Class A, Class M and Class B Certificates shall be Book-Entry
Certificates.
"Book-Entry Regulation S Global Securities": As defined in Section
5.01.
"Business Day": Any day other than a Saturday, a Sunday or a day on
which banking institutions in the State of Delaware, the State of New York, the
State of Texas or in the city in which the Corporate Trust Office of the Trustee
is located are authorized or obligated by law or executive order to be closed.
"Cap": Any of the Group I Net WAC Cap, the Group I Maximum Rate Cap,
the Group II Net WAC Cap, the Group II Maximum Rate Cap, the Subordinate Net WAC
Cap or the Subordinate Maximum Rate Cap.
"Cap Carryover Certificates": The Class AV, Class AF, Class M-1, Class
M-2, Class M-3, Class M-4, Class M-5, Class M-6, Class B-1, Class B-2, Class
B-3, Class B-4 and Class B-5 Certificates.
"Cap Contract": Either of the Group I Senior Cap Contract or the
Mezzanine Cap Contract.
"Cap Contract Counterparty": Barclays Bank PLC.
"Cap Contract Notional Balance": Either of the Group I Senior Cap
Contract Notional Balance or the Mezzanine Cap Contract Notional Balance.
"Cap Contract Termination Date": Either of the Group I Senior Cap
Contract Termination Date or the Mezzanine Cap Contract Termination Date.
"Cap Rate": Either of the Group I Senior Cap Contract Cap Rate or the
Mezzanine Cap Contract Cap Rate.
7
"Certificate": Any Regular Certificate or Residual Certificate.
"Certificate Custodian": Initially, JPMorgan Chase Bank, National
Association; thereafter any other Certificate Custodian acceptable to the
Depository and selected by the Trustee.
"Certificate Owner": With respect to each Book-Entry Certificate, any
beneficial owner thereof.
"Certificate Principal Balance": With respect to any Class of
Certificates (other than the Class N, Class X and Residual Certificates) and any
Distribution Date, the Original Class Certificate Principal Balance reduced by
the sum of (i) all amounts actually distributed in respect of principal of such
Class on all prior Distribution Dates and (ii) Applied Realized Loss Amounts
allocated thereto. The Class N, Class X and Residual Certificates do not have a
Certificate Principal Balance. With respect to any Certificate (other than a
Class X, Class N or a Residual Certificate) of a Class and any Distribution
Date, the portion of the Certificate Principal Balance of such Class represented
by such Certificate equal to the product of the Percentage Interest evidenced by
such Certificate and the Certificate Principal Balance of such Class.
Notwithstanding the foregoing on any Distribution Date relating to a Collection
Period in which a Subsequent Recovery has been received by the Servicer, the
Certificate Principal Balance of any Class of Certificates then outstanding for
which any Applied Realized Loss Amount has been allocated will be increased, in
order of seniority, by an amount equal to the lesser of (i) the Unpaid Realized
Loss Amount for such Class of Certificates and (ii) the amount of any Subsequent
Recovery allocable to principal distributed on such date to the
Certificateholders (reduced by the amount of the increase in the Certificate
Principal Balance of any more senior Class of Certificates pursuant to this
sentence on such Distribution Date).
"Certificate Register" and "Certificate Registrar": The register
maintained and registrar appointed pursuant to Section 5.02 hereof.
"Certificateholder" or "Holder": The Person in whose name a Certificate
is registered in the Certificate Register, except that a Disqualified
Organization or Disqualified Non-U.S. Person shall not be a Holder of a Residual
Certificate for any purpose hereof.
"Class": Collectively, Certificates or REMIC Regular Interests which
have the same priority of payment and bear the same class designation and the
form of which is identical except for variation in the Percentage Interest
evidenced thereby.
"Class A Certificate": Any one of the Certificates with an "A"
designated on the face thereof substantially in the form annexed hereto as
Exhibits X-0, X-0, X-0, X-0 and A-5, executed by the Trustee on behalf of the
Trust and authenticated and delivered by the Certificate Registrar, representing
the right to distributions as set forth herein and therein.
"Class A Certificateholders": Collectively, the Holders of the Class A
Certificates.
"Class A Interest Carry Forward Amount": For any Distribution Date, the
sum of the Interest Carry Forward Amounts for the Class A Certificates for such
Distribution Date.
"Class A Principal Distribution Amount": As of any Distribution Date
(a) prior to the Stepdown Date or with respect to which a Trigger Event is in
effect, the Principal Distribution Amount and (b) on or after the Stepdown Date
and as long as a Trigger Event is not in effect, the excess of (x) the sum of
the Certificate Principal Balances of the Class A Certificates immediately prior
to such Distribution Date over (y) the lesser of (A) the product of (i) 55.10%
and (ii) the Pool Balance as of the last day of the related Collection Period
and (B) the Pool Balance as of the last day of the related Collection Period
minus the product of 0.50% and the Pool Balance on the Cut-off Date.
8
"Class AF Certificates": The Class AF-1, Class AF-2, Class AF-3 and
Class AF-4 Certificates.
"Class AF-1 Pass-Through Rate": For each Distribution Date, the least
of (i) (a) on or prior to the Optional Termination Date, 5.4240% per annum and
(b) following the Optional Termination Date, 5.9240% per annum, (ii) the Group
II Net WAC Cap and (iii) the Group II Maximum Rate Cap.
"Class AF-2 Pass-Through Rate": For each Distribution Date, the least
of (i) (a) on or prior to the Optional Termination Date, 5.2900% per annum and
(b) following the Optional Termination Date, 5.7900% per annum, (ii) the Group
II Net WAC Cap and (iii) the Group II Maximum Rate Cap.
"Class AF-3 Pass-Through Rate": For each Distribution Date, the least
of (i) (a) on or prior to the Optional Termination Date, 5.6560% per annum and
(b) following the Optional Termination Date, 6.1560% per annum, (ii) the Group
II Net WAC Cap and (iii) the Group II Maximum Rate Cap.
"Class AF-4 Pass-Through Rate": For each Distribution Date, the least
of (i) (a) on or prior to the Optional Termination Date, 5.5160% per annum and
(b) following the Optional Termination Date, 6.0160% per annum, (ii) the Group
II Net WAC Cap and (iii) the Group II Maximum Rate Cap.
"Class AF-4 Lockout Distribution Amount": For any Distribution Date,
the product of (x) the Class AF-4 Lockout Distribution Percentage and (y) the
Class AF-4 Pro Rata Distribution Amount. In no event shall the Class AF-4
Lockout Distribution Amount for a Distribution Date exceed the Group II
Principal Distribution Amount for such Distribution Date or the Certificate
Principal Balance of the Class AF-4 Certificates immediately prior to such
Distribution Date.
"Class AF-4 Lockout Distribution Percentage" means, for a Distribution
Date in any period listed in the table below, the applicable percentage listed
opposite such period:
Distribution Dates Lockout Percentage
------------------ ------------------
February 2006 through and including January 2009
0%
February 2009 through and including January 2011
45%
February 2011 through and including January 2012
80%
February 2012 through and including January 2013
100%
February 2013 and thereafter
300%
"Class AF-4 Pro Rata Distribution Amount" means, for any Distribution
Date, an amount equal to the product of (x) a fraction, the numerator of which
is the Certificate Principal Balance of the Class AF-4 Certificates immediately
prior to such Distribution Date and the denominator of which is the aggregate
Certificate Principal Balance of the Class AF Certificates immediately prior to
that Distribution Date and (y) the Group II Principal Distribution Amount for
that Distribution Date.
"Class AV Certificate Margin": For each Distribution Date (i) on or
prior to the Optional Termination Date, 0.2300% per annum, and (ii) following
the Optional Termination Date, 0.4600% per annum.
9
"Class AV Pass-Through Rate": For each Distribution Date, the least of
(i) LIBOR as of the related LIBOR Determination Date, plus the Class AV
Certificate Margin, (ii) the Group I Net WAC Cap and (iii) the Group I Maximum
Rate Cap.
"Class B Certificate": Any one of the Certificates with a "B"
designated on the face thereof substantially in the form annexed hereto as
Exhibits X-0, X-0, X-0, X-0 and B-5, executed by the Trustee on behalf of the
Trust and authenticated and delivered by the Certificate Registrar, representing
the right to distributions as set forth herein and therein.
"Class B Certificateholders": Collectively, the Holders of the Class B
Certificates.
"Class B-1 Applied Realized Loss Amount": As to the Class B-1
Certificates and as of any Distribution Date, the lesser of (x) the Certificate
Principal Balance thereof (after taking into account the distribution of the
Principal Distribution Amount on such Distribution Date, but prior to the
application of the Class B-1 Applied Realized Loss Amount, if any, on such
Distribution Date) and (y) the excess of (i) the Applied Realized Loss Amount as
of such Distribution Date over (ii) the sum of the Class B-2 Applied Realized
Loss Amount, the Class B-3 Applied Realized Loss Amount, the Class B-4 Applied
Realized Loss Amount and the Class B-5 Applied Realized Loss Amount in each case
as of such Distribution Date.
"Class B-1 Pass-Through Rate": For each Distribution Date, the least of
(i) (a) on or prior to the Optional Termination Date, 6.0000% per annum and (b)
following the Optional Termination Date, 6.5000% per annum, (ii) the Subordinate
Net WAC Cap and (iii) the Subordinate Maximum Rate Cap.
"Class B-1 Principal Distribution Amount": As of any Distribution Date
on or after the Stepdown Date and as long as a Trigger Event is not in effect,
the excess of (x) the sum of (i) the sum of the Certificate Principal Balances
of the Class A Certificates (after taking into account the payment of the Class
A Principal Distribution Amount on such Distribution Date), (ii) the Certificate
Principal Balance of the Class M-1 Certificates (after taking into account the
payment of the Class M-1 Principal Distribution Amount on such Distribution
Date), (iii) the Certificate Principal Balance of the Class M-2 Certificates
(after taking into account the payment of the Class M-2 Principal Distribution
Amount on such Distribution Date), (iv) the Certificate Principal Balance of the
Class M-3 Certificates (after taking into account the payment of the Class M-3
Principal Distribution Amount on such Distribution Date), (v) the Certificate
Principal Balance of the Class M-4 Certificates (after taking into account the
payment of the Class M-4 Principal Distribution Amount on such Distribution
Date), (vi) the Certificate Principal Balance of the Class M-5 Certificates
(after taking into account the payment of the Class M-5 Principal Distribution
Amount on such Distribution Date), (vii) the Certificate Principal Balance of
the Class M-6 Certificates (after taking into account the payment of the Class
M-6 Principal Distribution Amount on such Distribution Date) and (viii) the
Certificate Principal Balance of the Class B-1 Certificates immediately prior to
such Distribution Date over (y) the lesser of (A) the product of (i) 86.20% and
(ii) the Pool Balance as of the last day of the related Collection Period and
(B) the Pool Balance as of the last day of the related Collection Period minus
the product of 0.50% and the Pool Balance on the Cut-off Date.
"Class B-1 Realized Loss Amortization Amount": As to the Class B-1
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class B-1 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(b)(i) through (xxiii) hereof, in each
case for such Distribution Date.
10
"Class B-2 Applied Realized Loss Amount": As to the Class B-2
Certificates and as of any Distribution Date, the lesser of (x) the Certificate
Principal Balance thereof (after taking into account the distribution of the
Principal Distribution Amount on such Distribution Date, but prior to the
application of the Class B-2 Applied Realized Loss Amount, if any, on such
Distribution Date) and (y) the excess of (i) the Applied Realized Loss Amount as
of such Distribution Date over (ii) the sum of the Class B-3 Applied Realized
Loss Amount, the Class B-4 Applied Realized Loss Amount and the Class B-5
Applied Realized Loss Amount, in each case as of such Distribution Date.
"Class B-2 Pass-Through Rate": For each Distribution Date, the least of
(i) (a) on or prior to the Optional Termination Date, 6.0000% per annum and (b)
following the Optional Termination Date, 6.5000% per annum, (ii) the Subordinate
Net WAC Cap and (iii) the Subordinate Maximum Rate Cap.
"Class B-2 Principal Distribution Amount": As of any Distribution Date
on or after the Stepdown Date and as long as a Trigger Event is not in effect,
the excess of (x) the sum of (i) the sum of the Certificate Principal Balances
of the Class A Certificates (after taking into account the payment of the Class
A Principal Distribution Amount on such Distribution Date), (ii) the Certificate
Principal Balance of the Class M-1 Certificates (after taking into account the
payment of the Class M-1 Principal Distribution Amount on such Distribution
Date), (iii) the Certificate Principal Balance of the Class M-2 Certificates
(after taking into account the payment of the Class M-2 Principal Distribution
Amount on such Distribution Date), (iv) the Certificate Principal Balance of the
Class M-3 Certificates (after taking into account the payment of the Class M-3
Principal Distribution Amount on such Distribution Date), (v) the Certificate
Principal Balance of the Class M-4 Certificates (after taking into account the
payment of the Class M-4 Principal Distribution Amount on such Distribution
Date), (vi) the Certificate Principal Balance of the Class M-5 Certificates
(after taking into account the payment of the Class M-5 Principal Distribution
Amount on such Distribution Date), (vii) the Certificate Principal Balance of
the Class M-6 Certificates (after taking into account the payment of the Class
M-6 Principal Distribution Amount on such Distribution Date) (viii) the
Certificate Principal Balance of the Class B-1 Certificates (after taking into
account the payment of the Class B-1 Principal Distribution Amount on such
Distribution Date) and (ix) the Certificate Principal Balance of the Class B-2
Certificates immediately prior to such Distribution Date over (y) the lesser of
(A) the product of (i) 89.40% and (ii) the Pool Balance as of the last day of
the related Collection Period and (B) the Pool Balance as of the last day of the
related Collection Period minus the product of 0.50% and the Pool Balance on the
Cut-off Date.
"Class B-2 Realized Loss Amortization Amount": As to the Class B-2
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class B-2 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(b)(i) through (xxvi) hereof, in each
case for such Distribution Date.
"Class B-3 Applied Realized Loss Amount": As to the Class B-3
Certificates and as of any Distribution Date, the lesser of (x) the Certificate
Principal Balance thereof (after taking into account the distribution of the
Principal Distribution Amount on such Distribution Date, but prior to the
application of the Class B-3 Applied Realized Loss Amount, if any, on such
Distribution Date) and (y) the excess of (i) the Applied Realized Loss Amount as
of such Distribution Date over (ii) the sum of the Class B-4 Applied Realized
Loss Amount and the Class B-5 Applied Realized Loss Amount, in each case as of
such Distribution Date.
"Class B-3 Pass-Through Rate": For each Distribution Date, the least of
(i) (a) on or prior to the Optional Termination Date, 6.0000% per annum and (b)
following the Optional Termination Date, 6.5000% per annum, (ii) the Subordinate
Net WAC Cap and (iii) the Subordinate Maximum Rate Cap.
11
"Class B-3 Principal Distribution Amount": As of any Distribution Date
on or after the Stepdown Date and as long as a Trigger Event is not in effect,
the excess of (x) the sum of (i) the sum of the Certificate Principal Balances
of the Class A Certificates (after taking into account the payment of the Class
A Principal Distribution Amount on such Distribution Date), (ii) the Certificate
Principal Balance of the Class M-1 Certificates (after taking into account the
payment of the Class M-1 Principal Distribution Amount on such Distribution
Date), (iii) the Certificate Principal Balance of the Class M-2 Certificates
(after taking into account the payment of the Class M-2 Principal Distribution
Amount on such Distribution Date), (iv) the Certificate Principal Balance of the
Class M-3 Certificates (after taking into account the payment of the Class M-3
Principal Distribution Amount on such Distribution Date), (v) the Certificate
Principal Balance of the Class M-4 Certificates (after taking into account the
payment of the Class M-4 Principal Distribution Amount on such Distribution
Date), (vi) the Certificate Principal Balance of the Class M-5 Certificates
(after taking into account the payment of the Class M-5 Principal Distribution
Amount on such Distribution Date), (vii) the Certificate Principal Balance of
the Class M-6 Certificates (after taking into account the payment of the Class
M-6 Principal Distribution Amount on such Distribution Date), (viii) the
Certificate Principal Balance of the Class B-1 Certificates (after taking into
account the payment of the Class B-1 Principal Distribution Amount on such
Distribution Date), (ix) the Certificate Principal Balance of the Class B-2
Certificates (after taking into account the payment of the Class B-2 Principal
Distribution Amount on such Distribution Date) and (x) the Certificate Principal
Balance of the Class B-3 Certificates immediately prior to such Distribution
Date over (y) the lesser of (A) the product of (i) 91.50% and (ii) the Pool
Balance as of the last day of the related Collection Period and (B) the Pool
Balance as of the last day of the related Collection Period minus the product of
0.50% and the Pool Balance on the Cut-off Date.
"Class B-3 Realized Loss Amortization Amount": As to the Class B-3
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class B-3 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(b)(i) through (xxix) hereof, in each
case for such Distribution Date.
"Class B-4 Applied Realized Loss Amount": As to the Class B-4
Certificates and as of any Distribution Date, the lesser of (x) the Certificate
Principal Balance thereof (after taking into account the distribution of the
Principal Distribution Amount on such Distribution Date, but prior to the
application of the Class B-4 Applied Realized Loss Amount, if any, on such
Distribution Date) and (y) the excess of (i) the Applied Realized Loss Amount as
of such Distribution Date over (ii) the Class B-5 Applied Realized Loss Amount,
in each case as of such Distribution Date.
"Class B-4 Pass-Through Rate": For each Distribution Date, (i) (a) on
or prior to the Optional Termination Date, 6.0000% per annum and (b) following
the Optional Termination Date, 6.5000% per annum, (ii) the Subordinate Net WAC
Cap and (iii) the Subordinate Maximum Rate Cap.
"Class B-4 Principal Distribution Amount": As of any Distribution Date
on or after the Stepdown Date and as long as a Trigger Event is not in effect,
the excess of (x) the sum of (i) the sum of the Certificate Principal Balances
of the Class A Certificates (after taking into account the payment of the Class
A Principal Distribution Amount on such Distribution Date), (ii) the Certificate
Principal Balance of the Class M-1 Certificates (after taking into account the
payment of the Class M-1 Principal Distribution Amount on such Distribution
Date), (iii) the Certificate Principal Balance of the Class M-2 Certificates
(after taking into account the payment of the Class M-2 Principal Distribution
Amount on such Distribution Date), (iv) the Certificate Principal Balance of the
Class M-3 Certificates (after taking into account the payment of the Class M-3
Principal Distribution Amount on such Distribution Date), (v) the Certificate
Principal Balance of the Class M-4 Certificates (after taking into account the
payment of the Class M-4 Principal Distribution Amount on such Distribution
Date), (vi) the Certificate Principal Balance of the Class M-5 Certificates
(after taking into account the payment of the Class M-5 Principal Distribution
Amount on such Distribution Date), (vii) the Certificate Principal Balance of
the Class M-6 Certificates (after taking into account the payment of the Class
M-6 Principal Distribution Amount on such Distribution Date), (viii) the
Certificate Principal Balance of the Class B-1 Certificates (after taking into
account the payment of the Class B-1 Principal Distribution Amount on such
Distribution Date), (ix) the Certificate Principal Balance of the Class B-2
Certificates (after taking into account the payment of the Class B-2 Principal
Distribution Amount on such Distribution Date), (x) the Certificate Principal
Balance of the Class B-3 Certificates (after taking into account the payment of
the Class B-3 Principal Distribution Amount on such Distribution Date) and (xi)
the Certificate Principal Balance of the Class B-4 Certificates immediately
prior to such Distribution Date over (y) the lesser of (A) the product of (i)
93.40% and (ii) the Pool Balance as of the last day of the related Collection
Period and (B) the Pool Balance as of the last day of the related Collection
Period minus the product of 0.50% and the Pool Balance on the Cut-off Date.
12
"Class B-4 Realized Loss Amortization Amount": As to the Class B-4
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class B-4 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(b)(i) through (xxxii) hereof, in each
case for such Distribution Date.
"Class B-5 Applied Realized Loss Amount": As to the Class B-5
Certificates and as of any Distribution Date, the lesser of (x) the Certificate
Principal Balance thereof (after taking into account the distribution of the
Principal Distribution Amount on such Distribution Date, but prior to the
application of the Class B-5 Applied Realized Loss Amount, if any, on such
Distribution Date) and (y) the Applied Realized Loss Amount as of such
Distribution Date.
"Class B-5 Pass-Through Rate": For each Distribution Date, the least of
(i) (a) on or prior to the Optional Termination Date, 6.0000% per annum and (b)
following the Optional Termination Date, 6.5000% per annum, (ii) the Subordinate
Net WAC Cap and (iii) the Subordinate Maximum Rate Cap.
"Class B-5 Principal Distribution Amount": As of any Distribution Date
on or after the Stepdown Date and as long as a Trigger Event is not in effect,
the excess of (x) the sum of (i) the sum of the Certificate Principal Balances
of the Class A Certificates (after taking into account the payment of the Class
A Principal Distribution Amount on such Distribution Date), (ii) the Certificate
Principal Balance of the Class M-1 Certificates (after taking into account the
payment of the Class M-1 Principal Distribution Amount on such Distribution
Date), (iii) the Certificate Principal Balance of the Class M-2 Certificates
(after taking into account the payment of the Class M-2 Principal Distribution
Amount on such Distribution Date), (iv) the Certificate Principal Balance of the
Class M-3 Certificates (after taking into account the payment of the Class M-3
Principal Distribution Amount on such Distribution Date), (v) the Certificate
Principal Balance of the Class M-4 Certificates (after taking into account the
payment of the Class M-4 Principal Distribution Amount on such Distribution
Date), (vi) the Certificate Principal Balance of the Class M-5 Certificates
(after taking into account the payment of the Class M-5 Principal Distribution
Amount on such Distribution Date), (vii) the Certificate Principal Balance of
the Class M-6 Certificates (after taking into account the payment of the Class
M-6 Principal Distribution Amount on such Distribution Date), (viii) the
Certificate Principal Balance of the Class B-1 Certificates (after taking into
account the payment of the Class B-1 Principal Distribution Amount on such
Distribution Date), (ix) the Certificate Principal Balance of the Class B-2
Certificates (after taking into account the payment of the Class B-2 Principal
Distribution Amount on such Distribution Date), (x) the Certificate Principal
Balance of the Class B-3 Certificates (after taking into account the payment of
the Class B-3 Principal Distribution Amount on such Distribution Date) (xi) the
Certificate Principal Balance of the Class B-4 Certificates (after taking into
account the payment of the Class B-4 Principal Distribution Amount for such
Distribution Date) and (xii) the Certificate Principal Balance of the Class B-5
Certificates immediately prior to such Distribution Date over (y) the lesser of
(A) the product of (i) 95.40% and (ii) the Pool Balance as of the last day of
the related Collection Period and (B) the Pool Balance as of the last day of the
related Collection Period minus the product of 0.50% and the Pool Balance on the
Cut-off Date.
13
"Class B-5 Realized Loss Amortization Amount": As to the Class B-5
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class B-5 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(b)(i) through (xxxv) hereof, in each
case for such Distribution Date.
"Class M Certificate": Any one of the Certificates with an "M"
designated on the face thereof substantially in the form annexed hereto as
Exhibits C-2, C-3, C-4 ,C-5 C-6 and C-7, executed by the Trustee on behalf of
the Trust and authenticated and delivered by the Certificate Registrar,
representing the right to distributions as set forth herein and therein.
"Class M Certificateholders": Collectively, the Holders of the Class M
Certificates.
"Class M-1 Applied Realized Loss Amount": As to the Class M-1
Certificates and as of any Distribution Date, the lesser of (x) the Certificate
Principal Balance thereof (after taking into account the distribution of the
Principal Distribution Amount on such Distribution Date, but prior to the
application of the Class M-1 Applied Realized Loss Amount, if any, on such
Distribution Date) and (y) the excess of (i) the Applied Realized Loss Amount as
of such Distribution Date over (ii) the sum of the Class M-2 Applied Realized
Loss Amount, the Class M-3 Applied Realized Loss Amount, the Class M-4 Applied
Realized Loss Amount, the Class M-5 Applied Realized Loss Amount, the Class M-6
Applied Realized Loss Amount, the Class B-1 Applied Realized Loss Amount, the
Class B-2 Applied Realized Loss Amount, the Class B-3 Applied Realized Loss
Amount, the Class B-4 Applied Realized Loss Amount and the Class B-5 Applied
Realized Loss Amount, in each case as of such Distribution Date.
"Class M-1 Certificate Margin": For each Distribution Date (i) on or
prior to the Optional Termination Date, 0.4100% per annum, and (ii) following
the Optional Termination Date, 0.6150% per annum.
"Class M-1 Pass-Through Rate": For each Distribution Date, the least of
(i) LIBOR as of the related LIBOR Determination Date, plus the Class M-1
Certificate Margin, (ii) the Subordinate Net WAC Cap and (iii) the Subordinate
Maximum Rate Cap.
"Class M-1 Principal Distribution Amount": As of any Distribution Date
on or after the Stepdown Date and as long as a Trigger Event is not in effect,
the excess of (x) the sum of (i) the Certificate Principal Balances of the Class
A Certificates (after taking into account the payment of the Class A Principal
Distribution Amount on such Distribution Date) and (ii) the Certificate
Principal Balance of the Class M-1 Certificates immediately prior to such
Distribution Date over (y) the lesser of (A) the product of (i) 61.70% and (ii)
the Pool Balance as of the last day of the related Collection Period and (B) the
Pool Balance as of the last day of the related Collection Period minus the
product of 0.50% and the Pool Balance on the Cut-off Date.
"Class M-1 Realized Loss Amortization Amount": As to the Class M-1
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-1 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(b)(i) through (v) hereof, in each case
for such Distribution Date.
14
"Class M-2 Applied Realized Loss Amount": As to the Class M-2
Certificates and as of any Distribution Date, the lesser of (x) the Certificate
Principal Balance thereof (after taking into account the distribution of the
Principal Distribution Amount on such Distribution Date, but prior to the
application of the Class M-2 Applied Realized Loss Amount, if any, on such
Distribution Date) and (y) the excess of (i) the related Applied Realized Loss
Amount as of such Distribution Date over (ii) the sum of the Class M-3 Applied
Realized Loss Amount, the Class M-4 Applied Realized Loss Amount, the Class M-5
Applied Realized Loss Amount, the Class M-6 Applied Realized Loss Amount, the
Class B-1 Applied Realized Loss Amount, the Class B-2 Applied Realized Loss
Amount, the Class B-3 Applied Realized Loss Amount, the Class B-4 Applied
Realized Loss Amount and the Class B-5 Applied Realized Loss Amount, in each
case as of such Distribution Date.
"Class M-2 Certificate Margin": For each Distribution Date (i) on or
prior to the Optional Termination Date, 0.4300% per annum, and (ii) following
the Optional Termination Date, 0.6450% per annum.
"Class M-2 Pass-Through Rate": For each Distribution Date, the least of
(i) LIBOR as of the related LIBOR Determination Date, plus the Class M-2
Certificate Margin, (ii) the Subordinate Net WAC Cap and (iii) the Subordinate
Maximum Rate Cap.
"Class M-2 Principal Distribution Amount": As of any Distribution Date
on or after the Stepdown Date and as long as a Trigger Event is not in effect,
the excess of (x) the sum of (i) the sum of the Certificate Principal Balances
of the Class A Certificates (after taking into account the payment of the Class
A Principal Distribution Amount on such Distribution Date), (ii) the Certificate
Principal Balance of the Class M-1 Certificates (after taking into account the
payment of the Class M-1 Principal Distribution Amount on such Distribution
Date) and (iii) the Certificate Principal Balance of the Class M-2 Certificates
immediately prior to such Distribution Date over (y) the lesser of (A) the
product of (i) 68.10% and (ii) the Pool Balance as of the last day of the
related Collection Period and (B) the Pool Balance as of the last day of the
related Collection Period minus the product of 0.50% and the Pool Balance on the
Cut-off Date.
"Class M-2 Realized Loss Amortization Amount": As to the Class M-2
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-2 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(b)(i) through (viii) hereof, in each
case for such Distribution Date.
"Class M-3 Applied Realized Loss Amount": As to the Class M-3
Certificates and as of any Distribution Date, the lesser of (x) the Certificate
Principal Balance thereof (after taking into account the distribution of the
Principal Distribution Amount on such Distribution Date, but prior to the
application of the Class M-3 Applied Realized Loss Amount, if any, on such
Distribution Date) and (y) the excess of (i) the related Applied Realized Loss
Amount as of such Distribution Date over (ii) the sum of the Class M-4 Applied
Realized Loss Amount, the Class M-5 Applied Realized Loss Amount, the Class M-6
Applied Realized Loss Amount, the Class B-1 Applied Realized Loss Amount, the
Class B-2 Applied Realized Loss Amount, the Class B-3 Applied Realized Loss
Amount, the Class B-4 Applied Realized Loss Amount and the Class B-5 Applied
Realized Loss Amount, in each case as of such Distribution Date.
"Class M-3 Certificate Margin": For each Distribution Date (i) on or
prior to the Optional Termination Date, 0.4700% per annum, and (ii) following
the Optional Termination Date, 0.7050% per annum.
15
"Class M-3 Pass-Through Rate": For each Distribution Date, the least of
(i) LIBOR as of the related LIBOR Determination Date, plus the Class M-3
Certificate Margin, (ii) the Subordinate Net WAC Cap and (iii) the Subordinate
Maximum Rate Cap.
"Class M-3 Principal Distribution Amount": As of any Distribution Date
on or after the Stepdown Date and as long as a Trigger Event is not in effect,
the excess of (x) the sum of (i) the sum of the Certificate Principal Balances
of the Class A Certificates (after taking into account the payment of the Class
A Principal Distribution Amount on such Distribution Date), (ii) the Certificate
Principal Balance of the Class M-1 Certificates (after taking into account the
payment of the Class M-1 Principal Distribution Amount on such Distribution
Date), (iii) the Certificate Principal Balance of the Class M-2 Certificates
(after taking into account the payment of the Class M-2 Principal Distribution
Amount on such Distribution Date), and (iv) the Certificate Principal Balance of
the Class M-3 Certificates immediately prior to such Distribution Date over (y)
the lesser of (A) the product of (i) 72.00% and (ii) the Pool Balance as of the
last day of the related Collection Period and (B) the Pool Balance as of the
last day of the related Collection Period minus the product of 0.50% and the
Pool Balance on the Cut-off Date.
"Class M-3 Realized Loss Amortization Amount": As to the Class M-3
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-3 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(b)(i) through (xi) hereof, in each case
for such Distribution Date.
"Class M-4 Applied Realized Loss Amount": As to the Class M-4
Certificates and as of any Distribution Date, the lesser of (x) the Certificate
Principal Balance thereof (after taking into account the distribution of the
Principal Distribution Amount on such Distribution Date, but prior to the
application of the Class M-4 Applied Realized Loss Amount, if any, on such
Distribution Date) and (y) the excess of (i) the related Applied Realized Loss
Amount as of such Distribution Date over (ii) the sum of the Class M-5 Applied
Realized Loss Amount, the Class M-6 Applied Realized Loss Amount, the Class B-1
Applied Realized Loss Amount, the Class B-2 Applied Realized Loss Amount, the
Class B-3 Applied Realized Loss Amount, the Class B-4 Applied Realized Loss
Amount and, the Class B-5 Applied Realized Loss Amount, in each case as of such
Distribution Date.
"Class M-4 Certificate Margin": For each Distribution Date (i) on or
prior to the Optional Termination Date, 0.6000% per annum, and (ii) following
the Optional Termination Date, 0.9000% per annum.
"Class M-4 Pass-Through Rate": For each Distribution Date, the least of
(i) LIBOR as of the related LIBOR Determination Date, plus the Class M-4
Certificate Margin, (ii) the Subordinate Net WAC Cap and (iii) the Subordinate
Maximum Rate Cap.
"Class M-4 Principal Distribution Amount": As of any Distribution Date
on or after the Stepdown Date and as long as a Trigger Event is not in effect,
the excess of (x) the sum of (i) the sum of the Certificate Principal Balances
of the Class A Certificates (after taking into account the payment of the Class
A Principal Distribution Amount on such Distribution Date), (ii) the Certificate
Principal Balance of the Class M-1 Certificates (after taking into account the
payment of the Class M-1 Principal Distribution Amount on such Distribution
Date), (iii) the Certificate Principal Balance of the Class M-2 Certificates
(after taking into account the payment of the Class M-2 Principal Distribution
Amount on such Distribution Date), (iv) the Certificate Principal Balance of the
Class M-3 Certificates (after taking into account the payment of the Class M-3
Principal Distribution Amount on such Distribution Date), and (v) the
Certificate Principal Balance of the Class M-4 Certificates immediately prior to
such Distribution Date over (y) the lesser of (A) the product of (i) 75.50% and
(ii) the Pool Balance as of the last day of the related Collection Period and
(B) the Pool Balance as of the last day of the related Collection Period minus
the product of 0.50% and the Pool Balance on the Cut-off Date.
16
"Class M-4 Realized Loss Amortization Amount": As to the Class M-4
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-4 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(b)(i) through (xiv) hereof, in each
case for such Distribution Date.
"Class M-5 Applied Realized Loss Amount": As to the Class M-5
Certificates and as of any Distribution Date, the lesser of (x) the Certificate
Principal Balance thereof (after taking into account the distribution of the
Principal Distribution Amount on such Distribution Date, but prior to the
application of the Class M-5 Applied Realized Loss Amount, if any, on such
Distribution Date) and (y) the excess of (i) the related Applied Realized Loss
Amount as of such Distribution Date over (ii) the sum of the Class M-6 Applied
Realized Loss Amount, the Class B-1 Applied Realized Loss Amount, the Class B-2
Applied Realized Loss Amount, the Class B-3 Applied Realized Loss Amount, the
Class B-4 Applied Realized Loss Amount and, the Class B-5 Applied Realized Loss
Amount, in each case as of such Distribution Date.
"Class M-5 Certificate Margin": For each Distribution Date (i) on or
prior to the Optional Termination Date, 0.6300% per annum, and (ii) following
the Optional Termination Date, 0.9450% per annum.
"Class M-5 Pass-Through Rate": For each Distribution Date, the least of
(i) LIBOR as of the related LIBOR Determination Date, plus the Class M-5
Certificate Margin, (ii) the Subordinate Net WAC Cap and (iii) the Subordinate
Maximum Rate Cap.
"Class M-5 Principal Distribution Amount": As of any Distribution Date
on or after the Stepdown Date and as long as a Trigger Event is not in effect,
the excess of (x) the sum of (i) the sum of the Certificate Principal Balances
of the Class A Certificates (after taking into account the payment of the Class
A Principal Distribution Amount on such Distribution Date), (ii) the Certificate
Principal Balance of the Class M-1 Certificates (after taking into account the
payment of the Class M-1 Principal Distribution Amount on such Distribution
Date), (iii) the Certificate Principal Balance of the Class M-2 Certificates
(after taking into account the payment of the Class M-2 Principal Distribution
Amount on such Distribution Date), (iv) the Certificate Principal Balance of the
Class M-3 Certificates (after taking into account the payment of the Class M-3
Principal Distribution Amount on such Distribution Date), (v) the Certificate
Principal Balance of the Class M-4 Certificates (after taking into account the
payment of the Class M-4 Principal Distribution Amount on such Distribution
Date), and (vi) the Certificate Principal Balance of the Class M-5 Certificates
immediately prior to such Distribution Date over (y) the lesser of (A) the
product of (i) 79.00% and (ii) the Pool Balance as of the last day of the
related Collection Period and (B) the Pool Balance as of the last day of the
related Collection Period minus the product of 0.50% and the Pool Balance on the
Cut-off Date.
"Class M-5 Realized Loss Amortization Amount": As to the Class M-5
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-5 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(b)(i) through (xvii) hereof, in each
case for such Distribution Date.
17
"Class M-6 Applied Realized Loss Amount": As to the Class M-6
Certificates and as of any Distribution Date, the lesser of (x) the Certificate
Principal Balance thereof (after taking into account the distribution of the
Principal Distribution Amount on such Distribution Date, but prior to the
application of the Class M-6 Applied Realized Loss Amount, if any, on such
Distribution Date) and (y) the excess of (i) the related Applied Realized Loss
Amount as of such Distribution Date over (ii) the sum of the Class B-1 Applied
Realized Loss Amount, the Class B-2 Applied Realized Loss Amount, the Class B-3
Applied Realized Loss Amount, the Class B-4 Applied Realized Loss Amount and,
the Class B-5 Applied Realized Loss Amount, in each case as of such Distribution
Date.
"Class M-6 Certificate Margin": For each Distribution Date (i) on or
prior to the Optional Termination Date, 0.7000% per annum, and (ii) following
the Optional Termination Date, 1.0500% per annum.
"Class M-6 Pass-Through Rate": For each Distribution Date, the least of
(i) LIBOR as of the related LIBOR Determination Date, plus the Class M-6
Certificate Margin, (ii) the Subordinate Net WAC Cap and (iii) the Subordinate
Maximum Rate Cap.
"Class M-6 Principal Distribution Amount": As of any Distribution Date
on or after the Stepdown Date and as long as a Trigger Event is not in effect,
the excess of (x) the sum of (i) the sum of the Certificate Principal Balances
of the Class A Certificates (after taking into account the payment of the Class
A Principal Distribution Amount on such Distribution Date), (ii) the Certificate
Principal Balance of the Class M-1 Certificates (after taking into account the
payment of the Class M-1 Principal Distribution Amount on such Distribution
Date), (iii) the Certificate Principal Balance of the Class M-2 Certificates
(after taking into account the payment of the Class M-2 Principal Distribution
Amount on such Distribution Date), (iv) the Certificate Principal Balance of the
Class M-3 Certificates (after taking into account the payment of the Class M-3
Principal Distribution Amount on such Distribution Date), (v) the Certificate
Principal Balance of the Class M-4 Certificates (after taking into account the
payment of the Class M-4 Principal Distribution Amount on such Distribution
Date), (vi) the Certificate Principal Balance of the Class M-5 Certificates
(after taking into account the payment of the Class M-5 Principal Distribution
Amount on such Distribution Date), and (vii) the Certificate Principal Balance
of the Class M-6 Certificates immediately prior to such Distribution Date over
(y) the lesser of (A) the product of (i) 82.40% and (ii) the Pool Balance as of
the last day of the related Collection Period and (B) the Pool Balance as of the
last day of the related Collection Period minus the product of 0.50% and the
Pool Balance on the Cut-off Date.
"Class M-6 Realized Loss Amortization Amount": As to the Class M-6
Certificates and as of any Distribution Date, the lesser of (x) the Unpaid
Realized Loss Amount for the Class M-6 Certificates as of such Distribution Date
and (y) the excess of (i) the Monthly Excess Cashflow Amount over (ii) the sum
of the amounts described in Section 4.02(b)(i) through (xx) hereof, in each case
for such Distribution Date.
"Class N Certificate": Any one of the Certificates with an "N"
designated on the face thereof substantially in the form annexed hereto as
Exhibit C-8, executed by the Trustee on behalf of the Trust and authenticated
and delivered by the Certificate Registrar, representing the right to
distributions as set forth herein and therein.
"Class N Notional Amount": As of any date, the Notional Amount of the
Class N Certificates.
"Class R Certificate": The Class R Certificate executed by the Trustee
on behalf of the Trust, and authenticated and delivered by the Certificate
Registrar, substantially in the form annexed hereto as Exhibit C-1-1 and
evidencing the ownership of the Residual Interest in each of REMIC 1 and REMIC
2. The Class R Certificate represents the ownership of the Class R-1 Interest
and Class R-2 Interest.
18
"Class R-1 Interest": The uncertificated residual interest in REMIC 1.
"Class R-2 Interest": The uncertificated residual interest in REMIC 2.
"Class R-B-2 Interest": The uncertificated residual interest in REMIC
B-2.
"Class R-B-3 Interest": The uncertificated residual interest in REMIC
B-3.
"Class R-B-4 Interest": The uncertificated residual interest in REMIC
B-4.
"Class R-B-5 Interest": The uncertificated residual interest in REMIC
B-5.
"Class R-X/N Interest": The uncertificated residual interest in REMIC
X/N.
"Class R-X Certificate": The Class R-X Certificate executed by the
Trustee on behalf of the Trust, and authenticated and delivered by the
Certificate Registrar, substantially in the form annexed hereto as Exhibit C-1-2
and evidencing the ownership of the Residual Interest in each of REMIC B-2,
REMIC B-3, REMIC B-4, REMIC B-5 and REMIC X/N. The Class R-X Certificate
represents the ownership of the Class R-B-2 Interest, Class R-B-3 Interest,
Class R-B-4 Interest, Class R-B-5 Interest and Class R-X/N Interest.
"Class X": Any one of the Class X Certificates as designated on the
face thereof substantially in the form annexed hereto as Exhibit C-9, executed
by the Trustee on behalf of the Trust and authenticated and delivered by the
Certificate Registrar, representing the right to distributions as set forth
herein and therein.
"Class X/N Interest": An uncertificated interest in the Trust held by
the Trustee on behalf of the holders of the Class X and Class N Certificates,
representing, for federal income tax purposes, ownership of the REMIC X/N X/N
Interest, and which is entitled to all distributions in respect of the REMIC X/N
X/N Interest less the amount of any Net WAC Carryover Amounts (other than Net
WAC Carryover Amounts funded from the Reserve Account).
"Class X Distributable Amount": With respect to any Distribution Date,
the excess of (i) the aggregate of amounts distributable on the Class X/N
Interest for such Distribution Date, over (ii) the aggregate of amounts
distributable to the Class N Certificates pursuant to Section 4.02(b).
"Closing Date": January 30, 2006.
"Code": The Internal Revenue Code of 1986, as it may be amended from
time to time.
"Collection Account": The account or accounts created and maintained by
the Servicer pursuant to Section 3.04, which shall be entitled "Collection
Account, Xxxxxx Loan Servicing LP, as Servicer for the registered Holders of the
Ownit 2006-1 Trust, Ownit Mortgage Loan Asset-Backed Certificates, Series
2006-1," and which must be an Eligible Account.
"Collection Period": With respect to any Distribution Date, the period
from the second day of the calendar month preceding the month in which such
Distribution Date occurs through the first day of the month in which such
Distribution Date occurs.
19
"Combined Loan-to-Value Ratio": As of any date and Mortgage Loan, the
fraction, expressed as a percentage, the numerator of which is the Principal
Balance of the Mortgage Loan as of the Cut-off Date plus the principal balance
of any related senior mortgage loan, if any, at origination of the Mortgage Loan
and the denominator of which is the Value of the related Mortgaged Property.
"Compensating Interest": As defined in Section 3.23 hereof.
"Condemnation Proceeds": All awards or settlements in respect of a
taking of a Mortgaged Property by exercise of the power of eminent domain or
condemnation.
"Corporate Trust Office": With respect to the Trustee, the principal
corporate trust office of the Trustee at which at any particular time (a) its
corporate trust business in connection with this Agreement shall be
administered, which office at the date of the execution of this instrument is
located at 0 Xxx Xxxx Xxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000,
Attention: Worldwide Securities Services/Structured Finance Services, Ownit
2006-1, and (b) certificates may be presented for transfer and exchange and for
purpose of surrender for the final distribution thereon is located at: 0000
Xxxxx Xxxxxx, 0xx Xxxxx, Xxxxxx, Xxxxx 00000, Attention: Transfer Department,
Ownit 2006-1, or at such other addresses as the Trustee may designate from time
to time by notice to the Certificateholders, the Depositor, the Servicer and the
Sponsor.
"Corresponding Cap Carryover Certificate" and "Corresponding REMIC 2
Regular Interest": For any REMIC 2 Regular Interest set forth below, the
corresponding Cap Carryover Certificate set forth below, and for any Cap
Carryover Certificate set forth below, the corresponding REMIC 2 Regular
Interest set forth below:
Corresponding Cap Carryover Certificate Corresponding REMIC 2 Regular Interest
--------------------------------------- --------------------------------------
Class AV Certificate REMIC 2 AV Interest
Class AF-1 Certificate REMIC 2 AF-1 Interest
Class AF-2 Certificate REMIC 2 AF-2 Interest
Class AF-3 Certificate REMIC 2 AF-3 Interest
Class AF-4 Certificate REMIC 2 AF-4 Interest
Class M-1 Certificate REMIC 2 M-1 Interest
Class M-2 Certificate REMIC 2 M-2 Interest
Class M-3 Certificate REMIC 2 M-3 Interest
Class M-4 Certificate REMIC 2 M-4 Interest
Class M-5 Certificate REMIC 2 M-5 Interest
Class M-6 Certificate REMIC 2 M-6 Interest
Class B-1 Certificate REMIC 2 B-1 Interest
Class B-2 Certificate REMIC 2 B-2 Interest
Class B-3 Certificate REMIC 2 B-3 Interest
Class B-4 Certificate REMIC 2 B-4 Interest
Class B-5 Certificate REMIC 2 B-5 Interest
20
"Custodial Agreement": The Custodial Agreement, dated as of January 1,
2006, among the Trustee, the Servicer and the Custodian, as the same may be
amended or supplemented pursuant to the terms thereof.
"Custodian": The Bank of New York, a New York banking corporation, or
any successor custodian appointed pursuant to the terms of the Custodial
Agreement.
"Cut-off Date": January 1, 2006.
"Cut-off Date Principal Balance": With respect to any Mortgage Loan,
the unpaid principal balance thereof as of the Cut-off Date after application of
funds received or advanced on or before such date (or as of the applicable date
of substitution with respect to an Eligible Substitute Mortgage Loan).
"Debt Service Reduction": With respect to any Mortgage Loan, a
reduction in the scheduled Monthly Payment for such Mortgage Loan by a court of
competent jurisdiction in a proceeding under the Bankruptcy Code, except such a
reduction resulting from a Deficient Valuation.
"Defective Mortgage Loan": A Mortgage Loan replaced or to be replaced
by one or more Eligible Substitute Mortgage Loans.
"Deficient Valuation": With respect to any Mortgage Loan, a valuation
of the related Mortgaged Property by a court of competent jurisdiction in an
amount less than the then outstanding principal balance of the Mortgage Loan,
which valuation results from a proceeding initiated under the Bankruptcy Code.
"Definitive Certificates": As defined in Section 5.02(c) hereof.
"Delinquent": Any Mortgage Loan with respect to which the Monthly
Payment and/or any Escrow Payment due on a Due Date is not made by the close of
business on the next scheduled Due Date for such Mortgage Loan or any Mortgage
Loan with respect to which any Servicing Advances made on or before the Cut-off
Date has not been reimbursed by the related Mortgagor.
"Depositor": Xxxxxxx Xxxxx Mortgage Investors, Inc., a Delaware
corporation, or any successor in interest.
"Depository": The initial depository shall be The Depository Trust
Company, whose nominee is 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(3) of the Uniform Commercial Code of
the State of New York.
21
"Depository Participant": A broker, dealer, bank or other financial
institution or other person for whom from time to time a Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
"Determination Date": With respect to any Distribution Date, the 10th
day of the calendar month in which such Distribution Date occurs or, if such
10th day is not a Business Day, the Business Day immediately preceding such 10th
day.
"Disqualified Non-U.S. Person": With respect to a Residual Certificate,
any (A) non-U.S. Person or agent thereof or (B) U.S. Person with respect to whom
income from a Residual Certificate is attributable to a foreign permanent
establishment or fixed base, within the meaning of an applicable income tax
treaty, of such Person or any other U.S. Person.
"Disqualified Organization": A "disqualified organization" under
Section 860E of the Code, which as of the Closing Date is any of: (i) the United
States, any state or political subdivision thereof, any possession of the United
States, any foreign government, any international organization, or any agency or
instrumentality of any of the foregoing, (ii) any organization (other than a
cooperative described in Section 521 of the Code) which is exempt from the tax
imposed by Chapter 1 of the Code unless such organization is subject to the tax
imposed by Section 511 of the Code, (iii) any organization described in Section
1381(a)(2)(C) of the Code, or (iv) any other Person so designated by the Trustee
based upon an Opinion of Counsel provided by nationally recognized counsel to
the Trustee that the holding of an ownership interest in a Residual Certificate
by such Person may cause the Trust Fund or any Person having an ownership
interest in any Class of Certificates (other than such Person) to incur
liability for any federal tax imposed under the Code that would not otherwise be
imposed but for the transfer of an ownership interest in a Residual Certificate
to such Person. A corporation will not be treated as an instrumentality of the
United States or of any state or political subdivision thereof if all of its
activities are subject to tax and a majority of its board of directors is not
selected by a governmental unit. The term "United States," "state" and
"international organization" shall have the meanings set forth in Section 7701
of the Code.
"Distribution Account": The trust account or accounts created and
maintained by the Trustee pursuant to Section 3.04(b) which shall be entitled
"Distribution Account, JPMorgan Chase Bank National Association, as Trustee, in
trust for the registered Holders of the Ownit 2006-1 Trust, Ownit Mortgage Loan
Asset-Backed Certificates, Series 2006-1" and which must be an Eligible Account.
"Distribution Date": The 25th day of any calendar month, or if such
25th day is not a Business Day, the Business Day immediately following such 25th
day, commencing in February 2006.
"Due Date": With respect to each Mortgage Loan and any Distribution
Date, the day of the calendar month in which such Distribution Date occurs on
which the Monthly Payment for such Mortgage Loan was due, exclusive of any grace
period.
"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 short-term unsecured debt obligations of such holding company) are
rated "A-2" (or the equivalent) by each of the Rating Agencies at the time any
amounts are held on deposit therein, (ii) an account or accounts the deposits in
which are fully insured by the FDIC (to the limits established by such
corporation), the uninsured deposits in which account are otherwise secured such
that, as evidenced by an Opinion of Counsel delivered to the Trustee and to each
Rating Agency, the Certificateholders will have a claim with respect to the
funds in such account or a perfected first priority security interest against
such 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 with which such account is maintained, (iii) a trust
account or accounts maintained with the trust department of a federal or state
chartered depository institution, national banking association or trust company
acting in its fiduciary capacity or (iv) an account otherwise acceptable to each
Rating Agency without reduction or withdrawal of their then current ratings of
the Certificates as evidenced by a letter from each Rating Agency to the
Trustee.
22
"Eligible Substitute Mortgage Loan": A mortgage loan substituted for a
Defective Mortgage Loan pursuant to the terms of this Agreement which must, on
the date of such substitution, (i) have an outstanding principal balance, after
application of all scheduled payments of principal and interest due during or
prior to the month of substitution, not in excess of, and not more than 5% less
than, the outstanding principal balance of the Defective Mortgage Loan as of the
Due Date in the calendar month during which the substitution occurs, (ii) have a
Mortgage Interest Rate, with respect to an adjustable rate Mortgage Loan, not
less than the Mortgage Interest Rate of the Defective Mortgage Loan and not more
than 1% in excess of the Mortgage Interest Rate of such Defective Mortgage Loan,
(iii) if an adjustable rate Mortgage Loan, have a Maximum Loan Rate not less
than the Maximum Loan Rate for the Defective Mortgage Loan, (iv) if an
adjustable rate Mortgage Loan, have a Minimum Loan Rate not less than the
Minimum Loan Rate of the Defective Mortgage Loan, (v) if an adjustable rate
Mortgage Loan, have a Gross Margin equal to or greater than the Gross Margin of
the Defective Mortgage Loan, (vi) if an adjustable rate Mortgage Loan, have the
same Index as the Defective Mortgage Loan, (vii) if an adjustable rate Mortgage
Loan, have a next Adjustment Date not more than two months later than the next
Adjustment Date on the Defective Mortgage Loan, (viii) have a remaining term to
maturity not greater than (and not more than one year less than) that of the
Defective Mortgage Loan, (ix) be current as of the date of substitution, (x)
have a Combined Loan-to-Value Ratio as of the date of substitution equal to or
lower than the Combined Loan-to-Value Ratio of the Defective Mortgage Loan as of
such date, (xi) have a risk grading determined by the Sponsor at least equal to
the risk grading assigned on the Defective Mortgage Loan, (xii) have been
reunderwritten by the Sponsor in accordance with the same underwriting criteria
and guidelines as the Defective Mortgage Loan, (xiii) have the same Due Date as
the Defective Mortgage Loan and (xiv) conform to each representation and
warranty set forth in Section 2.04 hereof applicable to the Defective Mortgage
Loan. In the event that one or more mortgage loans are substituted for one or
more Defective Mortgage Loans, the amounts described in clause (i) hereof shall
be determined on the basis of aggregate principal balances, the Mortgage
Interest Rates described in clause (ii) hereof shall be determined on the basis
of weighted average Mortgage Interest Rates, the risk gradings described in
clause (xi) hereof shall be satisfied as to each such mortgage loan, the terms
described in clause (viii) hereof shall be determined on the basis of weighted
average remaining term to maturity, the Combined Loan-to-Value Ratios described
in clause (x) hereof shall be satisfied as to each such mortgage loan and,
except to the extent otherwise provided in this sentence, the representations
and warranties described in clause (xiv) hereof must be satisfied as to each
Eligible Substitute Mortgage Loan or in the aggregate, as the case may be.
"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 would satisfy the requirements of
Prohibited Transaction Exemption 90-25, 55 Fed. Reg. 21459 (1990), as amended,
granted to the Underwriter by the United States Department of Labor (or any
other applicable underwriter's exemption granted by the United States Department
of Labor), except, in relevant part, for the requirement that the certificates
have received a rating at the time of acquisition that is in one of the three
(or four, in the case of a "designated transaction") highest generic rating
categories by at least one of the Rating Agencies.
23
"ERISA-Restricted Certificate": The Class N, Class X, Class R-X and
Class R Certificates and any other Certificate, unless the acquisition and
holding of such other Certificate is covered by and exempt under Prohibited
Transaction Exemption 90-25, 55 Fed. Reg. 21459 (1990), as amended, granted to
the Underwriter by the United States Department of Labor (or any other
applicable underwriter's exemption granted by the United States Department of
Labor).
"Escrow Account": The account or accounts created and maintained
pursuant to Section 3.06.
"Escrow Payments": The amounts constituting ground rents, taxes,
assessments, water rates, mortgage insurance premiums, fire and hazard insurance
premiums and other payments required to be escrowed by the Mortgagor with the
mortgagee pursuant to any Mortgage Loan.
"Estate in Real Property": A fee simple estate in a parcel of real
property.
"Expense Fee Rate": The sum of (i) the Trustee Fee Rate and (ii) the
Servicing Fee Rate.
"Extended Period": As defined in Section 9.04(b).
"Extra Principal Distribution Amount": As of any Distribution Date, the
lesser of (x) the Monthly Excess Cashflow Amount for such Distribution Date and
(y) the Overcollateralization Deficiency for such Distribution Date.
"FDIC": Federal Deposit Insurance Corporation or any successor thereto.
"Fidelity Bond": Shall have the meaning assigned thereto in Section
3.12.
"Final Maturity Date": As to each Class of Certificates, the date set
forth as such in the Preliminary Statement.
"Final Recovery Determination": With respect to any defaulted Mortgage
Loan or any REO Property (other than a Mortgage Loan or REO Property purchased
by the Sponsor or the Servicer pursuant to or as contemplated by Section 2.03 or
10.01), a determination made by the Servicer that all Insurance Proceeds,
Liquidation Proceeds and other payments or recoveries which the Servicer, in its
reasonable good faith judgment, expects to be finally recoverable in respect
thereof have been so recovered. The Servicer shall maintain records, prepared by
a Servicing Officer, of each Final Recovery Determination made thereby.
"First Lien Mortgage Loan": Any of the Mortgage Loans which are secured
by a first mortgage lien that is senior to a Second Lien Mortgage Loan on the
related Mortgaged Property.
"Fitch": Fitch Ratings and its successors, and if such company shall
for any reason no longer perform the functions of a securities rating agency,
"Fitch" shall be deemed to refer to any other "nationally recognized statistical
rating organization" as set forth on the most current list of such organizations
released by the Securities and Exchange Commission.
"Foreclosure Price": The amount reasonably expected to be received from
the sale of the related Mortgaged Property net of any expenses associated with
foreclosure proceedings.
"Grantor Trust": That portion of the Trust Fund exclusive of REMIC 1,
REMIC 2, REMIC B-2, REMIC B-3, REMIC B-4, REMIC B-5 and REMIC X/N which holds
(a) the REMIC X/N X/N Interest and (b) the obligation to pay Net WAC Carryover
Amounts (other than Net WAC Carryover Amounts funded from the Reserve Account).
24
"Gross Margin": With respect to each adjustable rate Mortgage Loan, the
fixed percentage, if any, set forth in the related Mortgage Note that is added
to the Index on each Adjustment Date in accordance with the terms of the related
Mortgage Note used to determine the Mortgage Interest Rate for such Mortgage
Loan.
"Group I Group Subordinate Amount": For any Distribution Date, the
excess of the aggregate Principal Balance of the Group I Mortgage Loans (as of
the first day of the related Collection Period) over the aggregate Certificate
Principal Balance of the Class AV Certificates as of such Distribution Date
(before distributions in respect of principal on such Distribution Date).
"Group I Interest Remittance Amount": As of any Distribution Date, the
sum, without duplication, of (i) all interest received by the Servicer on or
prior to the related Determination Date for such Distribution Date or advanced
with respect to Monthly Payments due during the related Collection Period on the
Group I Mortgage Loans (less the portion related to the Group I Mortgage Loans
of each of (a) the Servicing Fee, (b) amounts available for reimbursement of
Advances and Servicing Advances pursuant to Section 3.05 and (c) expenses
reimbursable pursuant to Section 6.03 and fees, expenses and indemnities due
pursuant to Section 8.05), (ii) the portion of any full or partial Principal
Prepayment related to interest with respect to a Group I Mortgage Loan received
during the related Prepayment Period, (iii) all Compensating Interest paid by
the Servicer on the related Determination Date with respect to the Group I
Mortgage Loans, (iv) the portion of any payment in connection with any Purchase
Price, Net Liquidation Proceeds, Insurance Proceeds or Condemnation Proceeds
relating to interest with respect to the Group I Mortgage Loans received during
the related Prepayment Period, (v) the portion of any Substitution Adjustment
Amount relating to interest with respect to the Group I Mortgage Loans received
during the related Prepayment Period, (vi) with respect to the related
Distribution Date on which the Trust is to be terminated in accordance with the
Section 10.01 hereof, that portion of the Termination Price with respect to the
Group I Mortgage Loans in respect of interest and (vii) the portion of any
Reimbursement Amount or Subsequent Recovery allocable to interest related to the
Group I Mortgage Loans received during the related Prepayment Period.
"Group I Loan Group Balance": As of any date of determination, the
aggregate Principal Balance of the Group I Mortgage Loans.
"Group I Maximum Rate Cap": With respect to any Distribution Date, a
per annum rate (subject to adjustment in the case of the Class AV Certificates
based on the actual number of days elapsed in the related Interest Accrual
Period) equal to 12 times the quotient of (x) the total scheduled interest that
would have accrued on the Group I Mortgage Loans for the related Collection
Period at their maximum lifetime Net Mortgage Interest Rates and (y) the
aggregate Principal Balance of the Group I Mortgage Loans (as of the first day
of the related Collection Period).
"Group I Mortgage Loan": A Mortgage Loan in Loan Group I.
"Group I Net Rate": With respect to any Distribution Date, a per annum
rate equal to 12 times the quotient of (x) the total scheduled interest on the
Group I Mortgage Loans for the related Collection Period at their Net Mortgage
Interest Rates and (y) the aggregate Principal Balance of the Group I Mortgage
Loans (as of the first day of the related Collection Period).
"Group I Net WAC Cap": With respect to any Distribution Date, a per
annum rate (subject to adjustment in the case of the Class AV Certificates based
on the actual number of days elapsed in the related Collection Period) equal to
12 times the quotient of (x) the total scheduled interest on the Group I
Mortgage Loans for the related Interest Accrual Period at the Net Mortgage
Interest Rates and (y) the aggregate Principal Balance of the Group I Mortgage
Loans (as of the first day of the related Collection Period).
25
"Group I Principal Allocation Percentage": As of any Distribution Date,
a fraction expressed as a percentage, the numerator of which is the Principal
Remittance Amount allocable to the Group I Mortgage Loans during the related
Collection Period and the denominator of which is equal to the Principal
Remittance Amount for such Distribution Date.
"Group I Principal Distribution Amount": As of any Distribution Date,
the product of the Group I Principal Allocation Percentage and the Class A
Principal Distribution Amount.
"Group I Senior Cap Contract": The confirmation and agreement and any
related confirmation thereto, between the Trustee and the Cap Contract
Counterparty for the benefit of the Class AV Certificates (attached hereto as
Exhibit N-1 hereto).
"Group I Senior Cap Contract Notional Balance": With respect to any
Distribution Date, the Cap Contract Notional Balance set forth for such
Distribution Date on the attachment to the Group I Senior Cap Contract attached
hereto.
"Group I Senior Cap Contract Payments": Payments made by the Cap
Contract Counterparty pursuant to the Group I Senior Cap Contract.
"Group I Senior Cap Contract Termination Date": The date after the
Distribution Date in February 2012
"Group II Group Subordinate Amount": For any Distribution Date, the
excess of the aggregate Principal Balance of the Group II Mortgage Loans (as of
the first day of the related Collection Period) over the aggregate Certificate
Principal Balance of the Class AF Certificates as of such Distribution Date
(before distributions in respect of principal on such Distribution Date).
"Group II Interest Remittance Amount": As of any Distribution Date, the
sum, without duplication, of (i) all interest received by the Servicer on or
prior to the related Determination Date for such Distribution Date or advanced
with respect to Monthly Payments due during the related Collection Period on the
Group II Mortgage Loans (less the portion related to the Group II Mortgage Loans
of each of (a) the Servicing Fee, (b) amounts available for reimbursement of
Advances and Servicing Advances pursuant to Section 3.05 and (c) expenses
reimbursable pursuant to Section 6.03 and fees, expenses and indemnities due
pursuant to Section 8.05), (ii) the portion of any full or partial Principal
Prepayment related to interest with respect to a Group II Mortgage Loan received
during the related Prepayment Period, (iii) all Compensating Interest paid by
the Servicer on the related Determination Date with respect to the Group II
Mortgage Loans, (iv) the portion of any payment in connection with any Purchase
Price, Net Liquidation Proceeds, Insurance Proceeds or Condemnation Proceeds
relating to interest with respect to the Group II Mortgage Loans received during
the related Prepayment Period, (v) the portion of any Substitution Adjustment
Amount relating to interest with respect to the Group II Mortgage Loans received
during the related Prepayment Period, (vi) with respect to the related
Distribution Date on which the Trust is to be terminated in accordance with the
Section 10.01 hereof, that portion of the Termination Price with respect to the
Group II Mortgage Loans in respect of interest and (vii) the portion of any
Reimbursement Amount or Subsequent Recovery related to the Group II Mortgage
Loans related to interest received during the related Prepayment Period.
26
"Group II Loan Group Balance": As of any date of determination, the
aggregate Principal Balance of the Group II Mortgage Loans.
"Group II Maximum Rate Cap": With respect to any Distribution Date, a
per annum rate equal to 12 times the quotient of (x) the total scheduled
interest that would have accrued on the Group II Mortgage Loans for the related
Collection Period at their maximum lifetime Net Mortgage Interest Rates and (y)
the aggregate Principal Balance of the Group II Mortgage Loans (as of the first
day of the related Collection Period).
"Group II Mortgage Loan": A Mortgage Loan in Loan Group II.
"Group II Net Rate": With respect to any Distribution Date, a per annum
rate equal to 12 times the quotient of (x) the total scheduled interest on the
Group II Mortgage Loans for the related Collection Period at their Net Mortgage
Interest Rates and (y) the aggregate Principal Balance of the Group II Mortgage
Loans (as of the first day of the related Collection Period).
"Group II Net WAC Cap": With respect to any Distribution Date, a per
annum rate equal to 12 times the quotient of (x) the total scheduled interest on
the Group II Mortgage Loans for the related Collection Period at their Net
Mortgage Interest Rates and (y) the aggregate Principal Balance of the Group II
Mortgage Loans (as of the first day of the related Collection Period).
"Group II Principal Allocation Percentage": As of any Distribution
Date, a fraction expressed as a percentage, the numerator of which is the
Principal Remittance Amount allocable to the Group II Mortgage Loans during the
related Collection Period and the denominator of which is equal to the Principal
Remittance Amount for such Distribution Date.
"Group II Principal Distribution Amount": As of any Distribution Date,
the product of the Group II Principal Allocation Percentage and the Class A
Principal Distribution Amount.
"Group Subordinate Amount": In the case of Loan Group I, the Group I
Group Subordinate Amount, and, in the case of Loan Group II, the Group II Group
Subordinate Amount.
"HUD": The United States Department of Housing and Urban Development,
or any successor thereto, including the Federal Housing Commissioner and the
Secretary of Housing and Urban Development where appropriate under the FHA
Regulations.
"Independent": When used with respect to any specified Person, any such
Person who (i) is in fact independent of the Depositor, the Servicer and their
respective Affiliates, (ii) does not have any direct financial interest in or
any material indirect financial interest in the Depositor or the Servicer or any
Affiliate thereof, and (iii) is not connected with the Depositor or the Servicer
or any Affiliate thereof as an officer, employee, promoter, underwriter,
trustee, partner, director or Person performing similar functions; provided,
however, that a Person shall not fail to be Independent of the Depositor or the
Servicer or any Affiliate thereof merely because such Person is the beneficial
owner of 1% or less of any Class of securities issued by the Depositor or the
Servicer or any Affiliate thereof, as the case may be.
27
"Independent Contractor": Either (i) any Person (other than the
Servicer) that would be an "independent contractor" with respect to the Trust
Fund within the meaning of Section 856(d)(3) of the Code if the Trust Fund were
a real estate investment trust (except that the ownership tests set forth in
that section shall be considered to be met by any Person that owns, directly or
indirectly, 35 percent or more of any Class of Certificates), so long as the
Trust Fund does not receive or derive any income from such Person and provided
that the relationship between such Person and the Trust Fund is at arm's length,
all within the meaning of Treasury Regulation Section 1.856-4(b)(5), or (ii) any
other Person (including the Servicer) if the Trustee has received an Opinion of
Counsel, which Opinion of Counsel shall be an expense of the Trust Fund, to the
effect that the taking of any action in respect of any REO Property by such
Person, subject to any conditions therein specified, that is otherwise herein
contemplated to be taken by an Independent Contractor will not cause such REO
Property to cease to qualify as "foreclosure property" within the meaning of
Section 860G(a)(8) of the Code (determined without regard to the exception
applicable for purposes of Section 860D(a) of the Code), or cause any income
realized in respect of such REO Property to fail to qualify as Rents from Real
Property.
"Index": With respect to each adjustable rate Mortgage Loan and with
respect to each related Adjustment Date, the index as specified in the related
Mortgage Note.
"Initial Certificate Principal Balance": With respect to any
Certificate of a Class other than a Class N, Class X or Residual Certificate,
the amount designated "Initial Certificate Principal Balance" on the face
thereof.
"Initial Notional Amount": With respect to any Class N Certificate, the
amount designated "Initial Notional Amount" on the face thereof.
"Initial Overcollateralization Amount": $16,682,990.11.
"Insurance Proceeds": Proceeds of any title policy, hazard policy or
other insurance policy covering a Mortgage Loan, to the extent such proceeds are
not to be applied to the restoration of the related Mortgaged Property or
released to the Mortgagor in accordance with the procedures that the Servicer
would follow in servicing mortgage loans held for its own account, subject to
the terms and conditions of the related Mortgage Note and Mortgage.
"Interest Accrual Period": With respect to any Distribution Date and
(i) with respect to the Class AV and Class M Certificates, the period from the
preceding Distribution Date through the day prior to the current Distribution
Date (or, in the case of the first Distribution Date, the period from the
Closing Date through and including February 26, 2006), and (ii) with respect to
the Class AF, Class B, Class N and Class X Certificates, the REMIC 1 Regular
Interests and the REMIC 2 X/N Interest, the calendar month immediately preceding
the month in which such Distribution Date occurs.
"Interest Carry Forward Amount": For any Class of Certificates (other
than the Residual Certificates) and any Distribution Date, the sum of (a) the
excess, if any, of the Accrued Certificate Interest and any Interest Carry
Forward Amount for each Class for the prior Distribution Date, over the amount
in respect of interest actually distributed on such Class on such prior
Distribution Date and (b) interest on such excess at the applicable Pass-Through
Rate (x) with respect to the Class AV and Class M Certificates, on the basis of
the actual number of days elapsed on the basis of a 360-day year since the prior
Distribution Date, and (y) with respect to the Class AF, Class B, Class N and
Class X Certificates, on the basis of a 360-day year consisting of twelve 30-day
months.
"Interest Percentage": With respect to any Class of Certificates and
any Distribution Date, the ratio (expressed as a decimal carried to ten places)
of the Accrued Certificate Interest for such Class to the sum of the Accrued
Certificate Interest for all Classes of Certificates, in each case with respect
to such Distribution Date and without regard to shortfalls caused by the Relief
Act or similar state law.
"Interest Remittance Amount": As of any Determination Date, the sum of
the Group I Interest Remittance Amount and the Group II Interest Remittance
Amount.
28
"Late Collections": With respect to any Mortgage Loan, all amounts
received subsequent to the Determination Date immediately following any related
Collection Period, whether as late payments of Monthly Payments or as Insurance
Proceeds, Liquidation Proceeds or otherwise, which represent late payments or
collections of principal and/or interest due (without regard to any acceleration
of payments under the related Mortgage and Mortgage Note) but delinquent on a
contractual basis for such Collection Period and not previously recovered.
"Lender": As defined in Section 3.30(a) hereof.
"LIBOR": With respect to each Interest Accrual Period, the rate
determined by the Trustee on the related LIBOR Determination Date on the basis
of the offered rate for one-month United States dollar deposits, as such rate
appears on the Telerate Page 3750, as of 11:00 a.m. (London time) on such LIBOR
Determination Date. If no such quotations are available on an LIBOR
Determination Date, LIBOR for the related Interest Accrual Period will be
established by the Trustee as follows:
(i) If on such LIBOR Determination Date two or more Reference
Banks provide quotations as to the rate at which deposits in U.S.
Dollars are offered as of 11:00 a.m. (London time) to prime banks in
the London interbank market for a period of one month in amounts
approximately equal to the aggregate Certificate Principal Balance of
the Class AV and Class M Certificates, LIBOR for the related Interest
Accrual Period shall be the arithmetic mean of such offered quotations
(rounded upwards if necessary to the nearest whole multiple of 0.001%);
(ii) If on such LIBOR Determination Date fewer than two
Reference Banks provide such offered quotations, LIBOR for the related
Interest Accrual Period shall be the arithmetic mean of the rates
quoted by one or more major banks in New York City, selected by the
Trustee after consultation with the Servicer, as of 11:00 a.m., New
York City time, on such date for loans in U.S. Dollars to leading
European banks for a period of one month in amounts approximately equal
to the aggregate Certificate Principal Balance of the Class AV and
Class M Certificates; and
(iii) If no such quotations can be obtained, LIBOR for the
related Interest Accrual Period shall be LIBOR for the prior
Distribution Date.
"LIBOR Business Day": Any day on which banks in London, England and The
City of New York are open and conducting transactions in foreign currency and
exchange.
"LIBOR Determination Date": With respect to the Class AV and Class M
Certificates, (i) for the first Distribution Date, the second LIBOR Business Day
preceding the Closing Date and (ii) for each subsequent Distribution Date, the
second LIBOR Business Day prior to the immediately preceding Distribution Date.
"Liquidated Mortgage Loan": As to any Distribution Date, any Mortgage
Loan in respect of which the Servicer has determined, in accordance with the
servicing procedures specified herein, as of the end of the related Prepayment
Period, that all Liquidation Proceeds and Insurance Proceeds which it expects to
recover with respect to the liquidation of the Mortgage Loan or disposition of
the related REO Property have been recovered.
"Liquidation Event": With respect to any Mortgage Loan, any of the
following events: (i) such Mortgage Loan is paid in full; (ii) a Final Recovery
Determination is made as to such Mortgage Loan; or (iii) such Mortgage Loan is
removed from the Trust Fund by reason of its being purchased, sold or replaced
pursuant to or as contemplated by Section 2.03 or Section 10.01. With respect to
any REO Property, either of the following events: (i) a Final Recovery
Determination is made as to such REO Property; or (ii) such REO Property is
removed from the Trust Fund by reason of its being sold or purchased pursuant to
Section 3.13 or Section 10.01.
29
"Liquidation Proceeds": The amount (other than amounts received in
respect of the rental of any REO Property prior to REO Disposition) received by
the Servicer in connection with (i) the taking of all or a part of a Mortgaged
Property by exercise of the power of eminent domain or condemnation or (ii) the
liquidation of a defaulted Mortgage Loan by means of a trustee's sale,
foreclosure sale or otherwise.
"Liquidation Report": The report with respect to a Liquidated Mortgage
Loan in such form and containing such information as is agreed to by the
Servicer and the Trustee.
"Loan Group": Either Loan Group I or Loan Group II, as the context
requires.
"Loan Group Balance": Either the Group I Loan Group Balance or the
Group II Loan Group Balance, as
applicable.
"Loan Group I": The pool of Mortgage Loans identified in Exhibit D-1 of
the Mortgage Loan Schedule as having been assigned to Loan Group I.
"Loan Group II": The pool of Mortgage Loans identified in Exhibit D-2
of the Mortgage Loan Schedule as having been assigned to Loan Group II.
"Losses": As defined in Section 9.03.
"Lost Note Affidavit": With respect to any Mortgage Loan as to which
the original Mortgage Note has been permanently lost or destroyed and has not
been replaced, an affidavit from the Sponsor certifying that the original
Mortgage Note has been lost, misplaced or destroyed (together with a copy of the
related Mortgage Note and indemnifying the Trust against any loss, cost or
liability resulting from the failure to deliver the original Mortgage Note) in
the form of Exhibit H hereto.
"Majority Certificateholders": The Holders of Certificates evidencing
at least 51% of the Voting Rights.
"Majority Class R Certificateholders": The Holders of Class R
Certificates evidencing at least a 51% Percentage Interest in the Class R
Certificates.
"Marker Interest": Each of the LT1-AV Interest, the LT1-AF1 Interest,
the LT1-AF2 Interest, the LT1-AF3 Interest, the LT1-AF4 Interest, the LT1-M1
Interest, the LT1-M2 Interest, the LT1-M3 Interest, the LT1-M4 Interest, the
LT1-M5 Interest, the LT1-M6 Interest, the LT1-B1 Interest, the LT1-B2 Interest,
the LT1-B3 Interest, the LT1-B4 Interest and the LT1-B5 Interest.
"Maximum Loan Rate": With respect to each adjustable rate Mortgage
Loan, the percentage set forth in the related Mortgage Note as the maximum
Mortgage Interest Rate thereunder.
"Maximum Rate Cap": Any of the Group I Maximum Rate Cap, the Group II
Maximum Rate Cap and the Subordinate Maximum Rate Cap.
"Mezzanine Cap Contract": The confirmation and agreement and any
related confirmation thereto, between the Trustee and the Cap Contract
Counterparty for the benefit of the Class M Certificates (attached as Exhibit
N-2 hereto).
30
"Mezzanine Cap Contract Notional Balance": With respect to any
Distribution Date, the Cap Contract Notional Balance set forth for such
Distribution Date on the attachment to the Mezzanine Cap Contract attached
hereto.
"Mezzanine Cap Contract Payments": Payments made by the Cap Contract
Counterparty pursuant to the Mezzanine Cap Contract.
"Mezzanine Cap Contract Termination Date": The day after the
Distribution Date in April 2009.
"Minimum Loan Rate": With respect to each adjustable rate Mortgage
Loan, the percentage set forth in the related Mortgage Note as the minimum
Mortgage Interest Rate thereunder or if no such percentage is set forth in the
related Mortgage Note, the Gross Margin set forth in the related Mortgage Note.
"Monthly Excess Cashflow Allocation": Shall have the meaning assigned
thereto in Section 4.02.
"Monthly Excess Cashflow Amount": The sum of the Monthly Excess
Interest Amount, the Overcollateralization Release Amount and (without
duplication) any portion of the Principal Distribution Amount remaining after
principal distributions on the Class A, Class M and Class B Certificates.
"Monthly Excess Interest Amount": With respect to each Distribution
Date, the amount, if any, by which the Interest Remittance Amount for such
Distribution Date exceeds the aggregate amount distributed on such Distribution
Date pursuant to paragraphs (i) through (xiv) under Section 4.01.
"Monthly Payment": With respect to any Mortgage Loan, the scheduled
monthly payment of principal and interest on such Mortgage Loan which is payable
by the related Mortgagor from time to time under the related Mortgage Note,
determined: (a) after giving effect to (i) any Deficient Valuation and/or Debt
Service Reduction with respect to such Mortgage Loan and (ii) any reduction in
the amount of interest collectible from the related Mortgagor pursuant to the
Relief Act or similar state laws; (b) without giving effect to any extension
granted or agreed to by the Servicer pursuant to Section 3.01; and (c) on the
assumption that all other amounts, if any, due under such Mortgage Loan are paid
when due.
"Moody's": Xxxxx'x Investors Service, Inc. and its successors, and if
such company shall for any reason no longer perform the functions of a
securities rating agency, "Moody's" shall be deemed to refer to any other
"nationally recognized statistical rating organization" as set forth on the most
current list of such organizations released by the Securities and Exchange
Commission.
"Mortgage": The mortgage, deed of trust or other instrument creating a
first or second lien on, or first or second priority security interest in, a
Mortgaged Property securing a Mortgage Note.
"Mortgage File": The mortgage documents listed in Section 2.01
pertaining to a particular Mortgage Loan and any additional documents required
to be added to the Mortgage File pursuant to this Agreement.
"Mortgage Interest Rate": With respect to each Mortgage Loan, the
annual rate at which interest accrues on such Mortgage Loan from time to time in
accordance with the provisions of the related Mortgage Note, which rate (i) in
the case of each adjustable rate Mortgage Loan (A) as of any date of
determination until the first Adjustment Date following the Cut-off Date shall
be the rate set forth in the Mortgage Loan Schedule as the Mortgage Interest
Rate in effect immediately following the Cut-off Date and (B) as of any date of
determination thereafter shall be the rate as adjusted on the most recent
Adjustment Date, to equal the sum, rounded to the nearest 0.125% as provided in
the Mortgage Note, of the Index, determined as set forth in the related Mortgage
Note, plus the related Gross Margin subject to the limitations set forth in the
related Mortgage Note and (ii) in the case of each fixed rate Mortgage Loan
shall remain constant at the rate set forth in the Mortgage Loan Schedule as the
Mortgage Interest Rate in effect immediately following the Cut-off Date. With
respect to each Mortgage Loan that becomes an REO Property, as of any date of
determination, the annual rate determined in accordance with the immediately
preceding sentence as of the date such Mortgage Loan became an REO Property.
31
"Mortgage Loan": Each mortgage loan transferred and assigned to the
Trustee pursuant to Section 2.01 or Section 2.03(d) as from time to time held as
a part of the Trust Fund, the Mortgage Loans so held being identified in the
Mortgage Loan Schedule and set forth in Exhibits D-1 and D-2 attached hereto.
"Mortgage Loan Purchase Agreement": The agreement between the Sponsor
and the Depositor, dated as of January 30, 2006, regarding the transfer of the
Mortgage Loans by the Sponsor to or at the direction of the Depositor attached
hereto as Exhibit G.
"Mortgage Loan Schedule": As of any date (i) with respect to the
Mortgage Loans, the list of such Mortgage Loans included in the Trust Fund on
such date, separately identifying the Group I Mortgage Loans and the Group II
Mortgage Loans, attached hereto as Exhibits D-1 and D-2. The Mortgage Loan
Schedule shall be prepared by the Sponsor and shall set forth the following
information with respect to each Mortgage Loan:
(1) the Sponsor's Mortgage Loan identifying number;
(2) the city, state, and zip code of the Mortgaged Property;
(3) the type of Residential Dwelling constituting the Mortgaged Property or
a designation that the Mortgaged Property is a multi-family property;
(4) the occupancy status of the Mortgaged Property at origination;
(5) the original months to maturity;
(6) the date of origination;
(7) the first payment date;
(8) the stated maturity date;
(9) the stated remaining months to maturity;
(10) the original principal amount of the Mortgage Loan;
(11) the Principal Balance of each Mortgage Loan as of the Cut-off Date;
(12) the Mortgage Interest Rate of the Mortgage Loan as of the Cut-off Date;
(13) the current principal and interest payment of the Mortgage Loan as of
the Cut-off Date;
32
(14) the contractual interest paid to date of the Mortgage Loan;
(15) if the Mortgage Loan is not owner-financed, the Combined Loan-to-Value
Ratio at origination;
(16) a code indicating the loan performance status of the Mortgage Loan as
of the Cut-off Date;
(17) a code indicating whether the Mortgaged Property is in bankruptcy or in
its forbearance period as of the Cut-off Date;
(18) [reserved;]
(19) a code indicating the Index that is associated with such Mortgage Loan;
(20) the Gross Margin;
(21) the Periodic Rate Cap;
(22) the Minimum Loan Rate;
(23) the Maximum Loan Rate;
(24) a code indicating whether the Mortgage Loan has a prepayment penalty
and the type of prepayment penalty;
(25) the first Adjustment Date immediately following the Cut-off Date;
(26) the rate adjustment frequency;
(27) the payment adjustment frequency;
(28) a code indicating whether the Mortgage Loan is owner-financed;
(29) a code indicating whether the Mortgage Loan is an interest only
Mortgage Loan and, if so, the interest only period at origination; and
(30) a code indicating whether the Mortgage Loan is a Second Lien Mortgage
Loan.
The Mortgage Loan Schedule shall set forth the following information,
as of the Cut-off Date, with respect to the Mortgage Loans in the aggregate, for
each Loan Group: (1) the number of Mortgage Loans; (2) the current Principal
Balance of the Mortgage Loans; (3) the weighted average Mortgage Interest Rate
of the Mortgage Loans; and (4) the weighted average maturity of the Mortgage
Loans. The Mortgage Loan Schedule shall be amended from time to time by the
Sponsor in accordance with the provisions of this Agreement. With respect to any
Eligible Substitute Mortgage Loan, Cut-off Date shall refer to the related
Cut-off Date for such Mortgage Loan, determined in accordance with the
definition of Cut-off Date herein.
"Mortgage Note": The original executed note or other evidence of
indebtedness evidencing the indebtedness of a Mortgagor under a Mortgage Loan.
33
"Mortgage Pool": The pool of Mortgage Loans, identified on Exhibits D-1
and D-2 from time to time, and any REO Properties acquired in respect thereof.
"Mortgaged Property": The underlying property securing a Mortgage Loan,
including any REO Property, consisting of an Estate in Real Property improved by
a Residential Dwelling or multi-family dwelling.
"Mortgagor": The obligor on a Mortgage Note.
"Net Liquidation Proceeds": With respect to any Liquidated Mortgage
Loan or any other disposition of related Mortgaged Property (including REO
Property) the related Liquidation Proceeds net of Advances, Servicing 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 Mortgage Interest Rate": With respect to any Mortgage Loan, the
Mortgage Interest Rate borne by such Mortgage Loan minus the Expense Fee Rate.
"Net Rate": With respect to any Distribution Date, a per annum rate
equal to 12 times the quotient of (x) the total scheduled interest on the
Mortgage Loans for the related Collection Period at their Net Mortgage Rates and
(y) the aggregate Principal Balance of the Mortgage Loans (as of the first day
of the related Collection Period).
"Net WAC Cap": Any of the Group I Net WAC Cap, the Group II Net WAC Cap
and the Subordinated Net WAC Cap.
"Net WAC Carryover Amount": If on any Distribution Date, the Accrued
Certificate Interest for (a) the Class AV Certificates is based upon the Group I
Net WAC Cap, (b) the Class AF Certificates is based upon the Group II Net WAC
Cap or (c) any class of the Class M or Class B Certificates is based on the
Subordinate Net WAC Cap, the excess of (i) the amount of interest such class
would have been entitled to receive on such Distribution Date based on clauses
(i) and (iii) only of its Pass-Through Rate over (ii) the amount of interest
such class was entitled to receive on such Distribution Date based on the
applicable Net WAC Cap, together with the unpaid portion of any such excess from
prior Distribution Dates (and interest accrued thereon at the then applicable
Pass-Through Rate (based on clauses (i) and (iii) only of its Pass-Through Rate)
on such class).
"New Lease": Any lease of REO Property entered into on behalf of the
Trust, including any lease renewed or extended on behalf of the Trust if the
Trust has the right to renegotiate the terms of such lease.
"Nonrecoverable Advance": Any Advance or Servicing Advance previously
made or proposed to be made in respect of a Mortgage Loan or REO Property that,
in the good faith business judgment of the Servicer, will not or, in the case of
a proposed Advance or Servicing Advance, would not be ultimately recoverable
from Late Collections on such Mortgage Loan or REO Property as provided herein.
"Notional Amount": With respect to the Class N Certificates, an amount
equal to the Original Class N Notional Amount reduced by the aggregate
distributions made to the Class N Certificates in respect of the Class N
Notional Amount pursuant to Section 4.02(b)(xxxix) or Section 4.02(c).
"Offered Certificates": The Class A, Class M and Class B-1
Certificates.
"Officer's Certificate": A certificate signed by the Chairman of the
Board, the Vice Chairman of the Board, the President or a vice president
(however denominated), or by the Treasurer, the Secretary, or one of the
assistant treasurers or assistant secretaries of the Servicer, the Sponsor or
the Depositor, as applicable.
34
"Opinion of Counsel": A written opinion of counsel, who may, without
limitation, be a salaried counsel for the Depositor or the Servicer except that
any opinion of counsel relating to (a) the qualification of any REMIC as a REMIC
or (b) compliance with the REMIC Provisions must be an opinion of Independent
counsel.
"Optional Termination Date": The first Distribution Date on which the
Servicer may elect to terminate the Mortgage Pool pursuant to Section 10.01.
"Original Class N Notional Amount": The Notional Amount of the Class N
Certificates on the Closing Date, as set forth opposite such Class in the
Preliminary Statement.
"Original Class Certificate Principal Balance": With respect to each
Class of Certificates, the Certificate Principal Balance thereof on the Closing
Date, as set forth opposite such Class in the Preliminary Statement, except with
respect to the Class N, Class X and Residual Certificates, which have an
Original Class Certificate Principal Balance of zero.
"Original Notional Amount": The Original Class N Notional Amount.
"Originator": Ownit Mortgage Solutions, Inc.
"Overcollateralization Amount": As of any Distribution Date, the
excess, if any, of (x) the Pool Balance as of the last day of the immediately
preceding Collection Period over (y) the aggregate Certificate Principal
Balances of all the Class A, Class M and Class B Certificates (after taking into
account all distributions of principal on such Distribution Date).
"Overcollateralization Deficiency": As of any Distribution Date, the
excess, if any, of (x) the Targeted Overcollateralization Amount for such
Distribution Date over (y) the Overcollateralization Amount for such
Distribution Date, calculated for this purpose after taking into account the
reduction on such Distribution Date of the Certificate Principal Balances of all
Classes of the Class A, Class M and Class B Certificates resulting from the
distribution of the Principal Distribution Amount (but not the Extra Principal
Distribution Amount) on such Distribution Date, but prior to taking into account
any Applied Realized Loss Amounts on such Distribution Date.
"Overcollateralization Release Amount": With respect to any
Distribution Date on or after the Stepdown Date on which a Trigger Event is not
in effect, the lesser of (x) the Principal Remittance Amount for such
Distribution Date and (y) the excess, if any, of (i) the Overcollateralization
Amount for such Distribution Date, assuming that 100% of the Principal
Remittance Amount is applied as a principal payment on the Class A, Class M and
Class B Certificates on such Distribution Date, over (ii) the Targeted
Overcollateralization Amount for such Distribution Date. With respect to any
Distribution Date on which a Trigger Event is in effect, the
Overcollateralization Release Amount will be zero.
"Ownership Interest": As to any Certificate, any ownership or security
interest in such Certificate, including any interest in such Certificate as the
Holder thereof and any other interest therein, whether direct or indirect, legal
or beneficial, as owner or as pledgee.
"Pass-Through Rate": Any of the Class AV Pass-Through Rate, the Class
AF-1 Pass-Through Rate, the Class AF-2 Pass-Through Rate, the Class AF-3
Pass-Through Rate, the Class AF-4 Pass-Through Rate, the Class M-1 Pass-Through
Rate, the Class M-2 Pass-Through Rate, the Class M-3 Pass-Through Rate, the
Class M-4 Pass-Through Rate, the Class M-5 Pass-Through Rate, the Class M-6
Pass-Through Rate, the Class B-1 Pass-Through Rate, the Class B-2 Pass-Through
Rate, the Class B-3 Pass-Through Rate, the Class B-4 Pass-Through Rate and the
Class B-5 Pass-Through Rate. With respect to the Class N Certificates, the
Pass-Through Rate is 6.500% per annum.
35
"Paying Agent": Any paying agent appointed pursuant to Section 5.05.
"Percentage Interest": With respect to any Certificate (other than a
Class N, Class X or Residual Certificate), a fraction, expressed as a
percentage, the numerator of which is the Initial Certificate Principal Balance
represented by such Certificate and the denominator of which is the Original
Class Certificate Principal Balance of the related Class. With respect to a
Class N Certificate, the undivided percentage interest obtained by dividing the
Initial Notional Amount evidenced by such Certificate by the Original Class N
Notional Amount, as the case may be, of such Class. With respect to a Class X or
Residual Certificate, the portion of the Class evidenced thereby, expressed as a
percentage, as stated on the face of such Certificate; provided, however, that
the sum of all such percentages for each such Class totals 100%.
"Periodic Rate Cap": With respect to each adjustable rate Mortgage Loan
and any Adjustment Date therefor, the fixed percentage set forth in the related
Mortgage Note, which is the maximum amount by which the Mortgage Interest Rate
for such Mortgage Loan may increase or decrease (without regard to the Maximum
Loan Rate or the Minimum Loan Rate) on such Adjustment Date from the Mortgage
Interest Rate in effect immediately prior to such Adjustment Date.
"Permitted Investments": Any one or more of the following obligations
or securities acquired at a purchase price of not greater than par, regardless
of whether issued or managed by the Depositor, the Servicer, the Trustee or any
of their respective Affiliates or for which an Affiliate of the Trustee serves
as an advisor:
(i) direct obligations of, or obligations fully guaranteed as
to timely payment of principal and interest by, the United States or
any agency or instrumentality thereof, provided such obligations are
backed by the full faith and credit of the United States;
(ii) (A) demand and time deposits in, certificates of deposit
of, bankers' acceptances issued by or federal funds sold by any
depository institution or trust company (including the Trustee or its
agents acting in their respective commercial capacities) incorporated
under the laws of the United States of America or any state thereof and
subject to supervision and examination by federal and/or state
authorities, so long as, at the time of such investment or contractual
commitment providing for such investment, such depository institution
or trust company or its ultimate parent has a short-term uninsured debt
rating in one of the two highest available rating categories of S&P and
Moody's and the highest available rating category of Fitch and provided
that each such investment has an original maturity of no more than 365
days and (B) any other demand or time deposit or deposit which is fully
insured by the FDIC;
(iii) repurchase obligations with a term not to exceed 30 days
with respect to any security described in clause (i) above and entered
into with a depository institution or trust company (acting as
principal) rated A or higher by S&P and Fitch and rated A2 or higher by
Moody's, provided, however, that collateral transferred pursuant to
such repurchase obligation must be of the type described in clause (i)
above and must (A) be valued daily at current market prices plus
accrued interest or (B) pursuant to such valuation, be equal, at all
times, to 105% of the cash transferred by the Trustee in exchange for
such collateral and (C) be delivered to the Trustee or, if the Trustee
is supplying the collateral, an agent for the Trustee, in such a manner
as to accomplish perfection of a security interest in the collateral by
possession of certificated securities;
36
(iv) securities bearing interest or sold at a discount that
are issued by any corporation incorporated under the laws of the United
States of America or any State thereof and that are rated by each
Rating Agency in its highest long-term unsecured rating categories at
the time of such investment or contractual commitment providing for
such investment;
(v) commercial paper (including both non-interest-bearing
discount obligations and interest-bearing obligations payable on demand
or on a specified date not more than 30 days after the date of
acquisition thereof) that is rated by each Rating Agency in its highest
short-term unsecured debt rating available at the time of such
investment;
(vi) units of money market funds registered under the
Investment Company Act of 1940 including funds managed or advised by
the Trustee or affiliates thereof having the highest rating category by
each applicable Rating Agency; and
(vii) if previously confirmed in writing to the Trustee, any
other demand, money market or time deposit, or any other obligation,
security or investment, as may be acceptable to the Rating Agencies in
writing as a permitted investment of funds backing securities having
ratings equivalent to its highest initial rating of the Class A
Certificates;
provided, that (i) no instrument described hereunder shall evidence either the
right to receive (a) only interest with respect to the obligations underlying
such instrument or (b) both principal and interest payments derived from
obligations underlying such instrument and the interest and principal payments
with respect to such instrument provide a yield to maturity at par greater than
120% of the yield to maturity at par of the underlying obligations and (ii) each
such investment must be a "permitted investment" within the meaning of Section
860G(a)(5) of the Code.
"Permitted Transferee": Any transferee of a Residual Certificate other
than a Disqualified Organization or a Disqualified Non-U.S. Person.
"Person": Any individual, corporation, partnership, joint venture,
association, joint stock company, trust, limited liability company,
unincorporated organization or government or any agency or political subdivision
thereof.
"Pool Balance": As of any date of determination, the aggregate
Principal Balance of the Mortgage Loans.
"Prepayment Interest Shortfall": With respect to any Distribution Date,
for each Mortgage Loan that was during the related Prepayment Period the subject
of a Principal Prepayment in full that was applied by the Servicer to reduce the
outstanding principal balance of such loan on a date preceding the related Due
Date, an amount equal to interest at the applicable Mortgage Interest Rate (net
of the Servicing Fee Rate) on the amount of such Principal Prepayment for the
number of days commencing on the date on which the prepayment is applied and
ending on the last day of the related Prepayment Period.
"Prepayment Period": With respect to any Distribution Date, the
calendar month preceding the month in which such Distribution Date occurs.
37
"Primary Insurance Policy": Each policy of primary guaranty mortgage
insurance issued by a Qualified Insurer in effect with respect to any Mortgage
Loan, or any replacement policy therefor obtained by the Servicer pursuant to
Section 3.08.
"Principal Balance": As to any Mortgage Loan and any day, other than a
Liquidated Mortgage Loan, the related Cut-off Date Principal Balance, minus the
sum of (i) all collections and other amounts credited against the principal
balance of any such Mortgage Loan, (ii) the principal portion of Advances, (iii)
any Deficient Valuation and (iv) any principal reduction resulting from a
Servicer Modification. For purposes of this definition, a Liquidated Mortgage
Loan shall be deemed to have a Principal Balance equal to the Principal Balance
of the related Mortgage Loan as of the final recovery of related Liquidation
Proceeds and a Principal Balance of zero thereafter. As to any REO Property and
any day, the Principal Balance of the related Mortgage Loan immediately prior to
such Mortgage Loan becoming REO Property minus any REO Principal Amortization
received with respect thereto on or prior to such day.
"Principal Distribution Amount": As to any Distribution Date, the sum
of (i) the Principal Remittance Amount minus, for Distribution Dates occurring
on and after the Stepdown Date and for which a Trigger Event is not in effect,
the Overcollateralization Release Amount, if any, and (ii) the Extra Principal
Distribution Amount, if any.
"Principal Prepayment": Any payment of principal made by the Mortgagor
on a Mortgage Loan which is received in advance of its scheduled Due Date and
which is not accompanied by an amount of interest representing the full amount
of scheduled interest due on any Due Date in any month or months subsequent to
the month of prepayment.
"Principal Remittance Amount": With respect to any Distribution Date,
to the extent of funds available therefor, the sum (less amounts available for
reimbursement of Advances and Servicing Advances pursuant to Section 3.05 and
expenses reimbursable pursuant to Section 6.03) of: (i) each payment of
principal on a Mortgage Loan due during the related Collection Period and
received by the Servicer on or prior to the related Determination Date, and any
Advances with respect thereto, (ii) the portion of all full and partial
Principal Prepayments or Insurance Proceeds, Condemnation Proceeds and
Subsequent Recoveries allocable to principal received by the Servicer during the
related Prepayment Period, (iii) the Net Liquidation Proceeds allocable to
principal actually collected by the Servicer during the related Prepayment
Period, (iv) with respect to Defective Mortgage Loans repurchased with respect
to such Prepayment Period, the portion of the Purchase Price allocable to
principal, (v) any Substitution Adjustment Amounts allocable to principal
received during the related Prepayment Period and (vi) on the Distribution Date
on which the Trust is to be terminated in accordance with Section 10.01 hereof,
that portion of the Termination Price in respect of principal.
"Private Certificates": Any of the Class B-2, Class B-3, Class B-4,
Class B-5, Class N, Class X and Residual Certificates.
"Property Insurance Proceeds": Proceeds of any title policy, hazard
policy or other insurance policy covering a Mortgage Loan, to the extent such
proceeds are received by the Servicer and are not to be applied to the
restoration of the related Mortgaged Property or released to the Mortgagor in
accordance with the Servicer's servicing procedures, subject to the terms and
conditions of the related Mortgage Note and Mortgage.
"Proportionate Holder": A Person that beneficially owns pro rata shares
of the Class N and Class X Certificates.
38
"Prospectus Supplement": That certain Prospectus Supplement dated
January 27, 2006, relating to the public offering of the Offered Certificates.
"Purchase Price": With respect to any Mortgage Loan or REO Property to
be purchased pursuant to or as contemplated by Section 2.03 or 10.01, and as
confirmed by an Officer's Certificate from the Servicer to the Trustee, an
amount equal to the sum of (i) 100% of the Principal Balance thereof as of the
date of purchase (or such other price as provided in Section 10.01), (ii) in the
case of (x) a Mortgage Loan, accrued interest on such Principal Balance at the
applicable Mortgage Interest Rate in effect from time to time from the Due Date
as to which interest was last covered by a payment by the Mortgagor or an
Advance by the Servicer, which payment or Advance had as of the date of purchase
been distributed pursuant to Section 4.01, through the end of the calendar month
in which the purchase is to be effected, and (y) an REO Property, its fair
market value, determined in good faith by the Servicer, (iii) any unreimbursed
Servicing Advances and Advances and any unpaid Servicing Fees allocable to such
Mortgage Loan or REO Property, (iv) any amounts previously withdrawn from the
Collection Account in respect of such Mortgage Loan or REO Property pursuant to
Section 3.13, and (v) in the case of a Mortgage Loan required to be purchased
pursuant to Section 2.03, (x) any costs and damages incurred by the Trust in
connection with any violation by such Mortgage Loan of any predatory and abusive
lending law and (y) expenses reasonably incurred or to be incurred by the
Servicer or the Trustee in respect of the breach or defect giving rise to the
purchase obligation.
"Qualified Insurer": Any insurance company acceptable to Xxxxxx Xxx or
Xxxxxxx Mac.
"Rating Agency or Rating Agencies": Xxxxx'x and S&P, or their
respective successors. If such agencies or their successors are no longer in
existence, "Rating Agencies" shall be such nationally recognized statistical
rating organizations as set forth on the most current list of such organizations
released by the Securities and Exchange Commission and designated by the
Depositor, notice of which designation shall be given to the Trustee and the
Servicer.
"Realized Loss": With respect to a Liquidated Mortgage Loan, the amount
by which the remaining unpaid Principal Balance of the Mortgage Loan plus
accrued and unpaid interest thereon at the Mortgage Interest Rate through the
last day of the month of liquidation, exceeds the amount of Net Liquidation
Proceeds applied to the principal balance of the related Mortgage Loan. With
respect to any Mortgage Loan, a Deficient Valuation or a reduction in the
Principal Balance thereof resulting from a Servicer Modification.
"Realized Loss Amortization Amount": Any of the Class M-1 Realized Loss
Amortization Amount, the Class M-2 Realized Loss Amortization Amount, the Class
M-3 Realized Loss Amortization Amount, the Class M-4 Realized Loss Amortization
Amount, the Class M-5 Realized Loss Amortization Amount, the Class M-6 Realized
Loss Amortization Amount, the Class B-1 Realized Loss Amortization Amount, the
Class B-2 Realized Loss Amortization Amount, the Class B-3 Realized Loss
Amortization Amount, the Class B-4 Realized Loss Amortization Amount and the
Class B-5 Realized Loss Amortization Amount.
"Record Date": With respect to Class AV and Class M Certificates, the
Business Day immediately preceding such Distribution Date; provided, however,
that if any such Certificate becomes a Definitive Certificate, the Record Date
for such Certificate shall be the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs. With respect
to the Class AF, Class B, Class N, Class X, Class R and Class R-X Certificates,
the last Business Day of the month immediately preceding the month in which the
related Distribution Date occurs or the Closing Date, in the case of the first
Distribution Date.
39
"Reference Banks": Those banks (i) with an established place of
business in London, England, (ii) not controlling, under the control of or under
common control with the Depositor or the Trustee, (iii) that have been
designated as such by the Trustee, after consultation with the Servicer and (iv)
that are engaged in transactions in the London interbank market.
"Regular Certificate": Any of the Class A, Class M, Class B, Class N
and Class X Certificates.
"Regulation AB": Subpart 22.1100 - 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 Securities and Exchange 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 Securities and Exchange Commission, or as may be
provided by the Securities and Exchange Commission or its staff from time to
time.
"Regulation S": Regulation S promulgated under the Securities Act or
any successor provision thereto, in each case as the same may be amended from
time to time; and all references to any rule, section or subsection of, or
definition or term contained in, Regulation S means such rule, section,
subsection, definition or term, as the case may be, or any successor thereto, in
each case as the same may be amended from time to time.
"Regulation S Global Securities": The Book-Entry Regulation S Global
Securities and the Definitive Regulation S Global Securities.
"Reimbursement Amount": As defined in Section 2.03.
"Related Documents": With respect to any Mortgage Loan, the related
Mortgage Notes, Mortgages and other related documents.
"Relief Act": The Servicemembers Civil Relief Act and similar state
laws.
"Relief Act Interest Shortfall": With respect to any Distribution Date,
for any Mortgage Loan with respect to which there has been a reduction in the
amount of interest collectible thereon for the most recently ended Collection
Period as a result of the application of the Relief Act or similar state laws,
the amount by which (i) interest collectible on such Mortgage Loan during such
Collection Period is less than (ii) one month's interest on the Principal
Balance of such Mortgage Loan at the Mortgage Interest Rate for such Mortgage
Loan before giving effect to the application of the Relief Act or similar state
laws.
"REMIC": A "real estate mortgage investment conduit" within the meaning
of Section 860D of the Code.
"REMIC Provisions": Provisions of the federal income tax law relating
to real estate mortgage investment conduits which appear at Section 860A through
860G of Subchapter M of Chapter 1 of the Code, and related provisions, and
regulations and rulings promulgated thereunder, as the foregoing may be in
effect from time to time.
"REMIC Regular Interest": Any REMIC 1 Regular Interest, REMIC 2 Regular
Interest, REMIC B-2 Regular Interest, REMIC B-3 Regular Interest, REMIC B-4
Regular Interest, REMIC B-5 Regular Interest or REMIC X/N Regular Interest.
"REMIC 1": As defined in the Preliminary Statement.
40
"REMIC 1 Interest": Each interest in REMIC 1 as described in the
Preliminary Statement.
"REMIC 1 Regular Interest": Each REMIC 1 Interest other than the Class
R-1 Interest.
"REMIC 1 Subordinated Balance Ratio": The ratio among the principal
balances of the Class LT1-IA Interest and the Class LT1-IIA Interest that is
equal to the ratio among, with respect to each such REMIC 1 Regular Interest,
the Group Subordinate Amount for the related Loan Group.
"REMIC 2": As defined in the Preliminary Statement.
"REMIC 2 Interest": Each of the REMIC 2 Regular Interests and the Class
R-2 Interest.
"REMIC 2 Regular Interest": Each of the REMIC 2 AV Interest, the REMIC
2 AF-1 Interest, the REMIC 2 AF-2 Interest, the REMIC 2 AF-3 Interest, the REMIC
2 AF-4 Interest, the REMIC 2 M-1 Interest, the REMIC 2 M-2 Interest, the REMIC 2
M-3 Interest, the REMIC 2 M-4 Interest, the REMIC 2 M-5 Interest, the REMIC 2
M-6 Interest, the REMIC 2 B-1 Interest, the REMIC 2 B-2 Interest, the REMIC 2
B-3 Interest, the REMIC 2 B-4 Interest, the REMIC 2 B-5 Interest and the REMIC 2
X/N Interest.
"REMIC 2 AV Interest": An uncertificated "regular interest" in REMIC 2
represented by the Class AV Certificates having the same rights to payments as
the Class AV Certificates other than the right to any payments in respect of Net
WAC Carryover Amounts.
"REMIC 2 AF-1 Interest": An uncertificated "regular interest" in REMIC
2 represented by the Class AF-1 Certificates having the same rights to payments
as the Class AF-1 Certificates other than the right to any payments in respect
of Net WAC Carryover Amounts.
"REMIC 2 AF-2 Interest": An uncertificated "regular interest" in REMIC
2 represented by the Class AF-2 Certificates having the same rights to payments
as the Class AF-2 Certificates other than the right to any payments in respect
of Net WAC Carryover Amounts.
"REMIC 2 AF-3 Interest": An uncertificated "regular interest" in REMIC
2 represented by the Class AF-3 Certificates having the same rights to payments
as the Class AF-3 Certificates other than the right to any payments in respect
of Net WAC Carryover Amounts.
"REMIC 2 AF-4 Interest": An uncertificated "regular interest" in REMIC
2 represented by the Class AF-4 Certificates having the same rights to payments
as the Class AF-4 Certificates other than the right to any payments in respect
of Net WAC Carryover Amounts.
"REMIC 2 M-1 Interest": An uncertificated "regular interest" in REMIC 2
represented by the Class M-1 Certificates having the same rights to payments as
the Class M-1 Certificates other than the right to any payments in respect of
Net WAC Carryover Amounts.
"REMIC 2 M-2 Interest": An uncertificated "regular interest" in REMIC 2
represented by the Class M-2 Certificates having the same rights to payments as
the Class M-2 Certificates other than the right to any payments in respect of
Net WAC Carryover Amounts.
"REMIC 2 M-3 Interest": An uncertificated "regular interest" in REMIC 2
represented by the Class M-3 Certificates having the same rights to payments as
the Class M-3 Certificates other than the right to any payments in respect of
Net WAC Carryover Amounts.
41
"REMIC 2 M-4 Interest": An uncertificated "regular interest" in REMIC 2
represented by the Class M-4 Certificates having the same rights to payments as
the Class M-4 Certificates other than the right to any payments in respect of
Net WAC Carryover Amounts.
"REMIC 2 M-5 Interest": An uncertificated "regular interest" in REMIC 2
represented by the Class M-5 Certificates having the same rights to payments as
the Class M-5 Certificates other than the right to any payments in respect of
Net WAC Carryover Amounts.
"REMIC 2 M-6 Interest": An uncertificated "regular interest" in REMIC 2
represented by the Class M-6 Certificates having the same rights to payments as
the Class M-6 Certificates other than the right to any payments in respect of
Net WAC Carryover Amounts.
"REMIC 2 B-1 Interest": An uncertificated "regular interest" in REMIC 2
represented by the Class B-1 Certificates having the same rights to payments as
the Class B-1 Certificates other than the right to any payments in respect of
Net WAC Carryover Amounts.
"REMIC 2 B-2 Interest": An uncertificated "regular interest" in REMIC 2
held by REMIC B-2 having the same rights to payments as the Class B-2
Certificates other than the right to any payments in respect of Net WAC
Carryover Amounts.
"REMIC 2 B-3 Interest": An uncertificated "regular interest" in REMIC 2
held by REMIC B-3 having the same rights to payments as the Class B-3
Certificates other than the right to any payments in respect of Net WAC
Carryover Amounts.
"REMIC 2 B-4 Interest": An uncertificated "regular interest" in REMIC 2
held by REMIC B-4 having the same rights to payments as the Class B-4
Certificates other than the right to any payments in respect of Net WAC
Carryover Amounts.
"REMIC 2 B-5 Interest": An uncertificated "regular interest" in REMIC 2
held by REMIC B-5 having the same rights to payments as the Class B-5
Certificates other than the right to any payments in respect of Net WAC
Carryover Amounts.
"REMIC 2 X/N Interest": An uncertificated "regular interest" in REMIC 2
held by REMIC X/N having an initial principal balance equal to the Initial
Overcollateralization Amount and bearing interest at the REMIC 2 X/N Interest
Distributable Interest Rate on a notional balance equal to the aggregate of the
Principal Balance of the Mortgage Loans outstanding as of the beginning of the
related Interest Accrual Period. The REMIC 2 X/N Interest shall be entitled to
all prepayment penalties (including amounts deposited in connection with the
full or partial waiver of such prepayment penalties pursuant to Section 3.01).
"REMIC 2 X/N Interest Current Interest": As of any Distribution Date,
the interest accrued during the related Interest Accrual Period at the REMIC 2
X/N Interest Distributable Interest Rate on a notional amount equal to the
aggregate of the Principal Balance of the Mortgage Loans outstanding as of the
beginning of such Interest Accrual Period (such amount of interest representing
a "specified portion" (within the meaning of Treasury Regulations Section
1.860G-1(a)(2)(i)(C)) of interest payments on the REMIC 1 Regular Interests).
"REMIC 2 X/N Interest Distributable Interest Rate": The excess, if any,
of (a) the weighted average of the interest rates on the REMIC 1 Regular
Interests over (b) two times the weighted average of the interest rates on the
Marker Interests and the LT1-X1 Interest (treating for purposes of this clause
(b) the interest rate on each of the Marker Interests as being subject to a cap
and a floor equal to the Pass-Through Rate (as adjusted to reflect a 30-day
accrual period) of the Related Certificate of such Marker Interest (as described
in the Preliminary Statement) and treating the interest rate on the LT1-X1
Interest as being capped at zero). The averages described in the preceding
sentence shall be weighted on the basis of the respective principal balances of
the relevant REMIC 1 Regular Interests immediately prior to any date of
determination.
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"REMIC B-2": As defined in the Preliminary Statement.
"REMIC B-2 Interest": Each of the REMIC B-2 Regular Interests and the
Class R-B-2 Interest.
"REMIC B-2 Regular Interest": The REMIC B-2 B-2 Interest.
"REMIC B-2 B-2 Interest": An uncertificated "regular interest" in REMIC
B-2 represented by the Class B-2 Certificates having the same rights to payments
as the Class B-2 Certificates other than the right to any payments in respect of
Net WAC Carryover Amounts.
"REMIC B-3": As defined in the Preliminary Statement.
"REMIC B-3 Interest": Each of the REMIC B-3 Regular Interests and the
Class R-B-3 Interest.
"REMIC B-3 Regular Interest": The REMIC B-3 B-3 Interest.
"REMIC B-3 B-3 Interest": An uncertificated "regular interest" in REMIC
B-3 represented by the Class B-3 Certificates having the same rights to payments
as the Class B-3 Certificates other than the right to any payments in respect of
Net WAC Carryover Amounts.
"REMIC B-4": As defined in the Preliminary Statement.
"REMIC B-4 Interest": Each of the REMIC B-4 Regular Interests and the
Class R-B-4 Interest.
"REMIC B-4 Regular Interest": The REMIC B-4 B-4 Interest.
"REMIC B-4 B-4 Interest": An uncertificated "regular interest" in REMIC
B-4 represented by the Class B-4 Certificates having the same rights to payments
as the Class B-4 Certificates other than the right to any payments in respect of
Net WAC Carryover Amounts.
"REMIC B-5": As defined in the Preliminary Statement.
"REMIC B-5 Interest": Each of the REMIC B-5 Regular Interests and the
Class R-B-5 Interest.
"REMIC B-5 Regular Interest": The REMIC B-5 B-5 Interest.
"REMIC B-5 B-5 Interest": An uncertificated "regular interest" in REMIC
B-5 represented by the Class B-5 Certificates having the same rights to payments
as the Class B-5 Certificates other than the right to any payments in respect of
Net WAC Carryover Amounts.
"REMIC X/N": As defined in the Preliminary Statement.
"REMIC X/N Interest": Each of the REMIC X/N Regular Interests and the
Class R-X/N Interest.
"REMIC X/N Regular Interest": The REMIC X/N X/N Interest.
43
"REMIC X/N X/N Interest": An uncertificated "regular interest" in REMIC
X/N held by the Trustee on behalf of the holders of the Class X and Class N
Certificates and entitled to all payments in respect of the REMIC 2 X/N
Interest.
"Remittance Report": A report prepared by the Servicer and delivered to
the Trustee pursuant to Section 4.07, containing the information attached hereto
as Exhibit M.
"Rents from Real Property": With respect to any REO Property, gross
income of the character described in Section 856(d) of the Code.
"REO Disposition": The sale or other disposition of an REO Property on
behalf of the Trust Fund.
"REO Principal Amortization": With respect to any REO Property, for any
calendar month, the aggregate of all amounts received in respect of such REO
Property during such calendar month, whether in the form of rental income, sale
proceeds (including, without limitation, that portion of the Termination Price
paid in connection with a purchase of all of the Mortgage Loans and REO
Properties pursuant to Section 10.01 that is allocable to such REO Property) or
otherwise, net of any portion of such amounts (i) payable pursuant to Section
3.13 in respect of the proper operation, management and maintenance of such REO
Property or (ii) payable or reimbursable to the Servicer pursuant to Section
3.13 for unpaid Servicing Fees in respect of the related Mortgage Loan and
unreimbursed Servicing Advances and Advances in respect of such REO Property or
the related Mortgage Loan.
"REO Property": A Mortgaged Property acquired by the Servicer on behalf
of the Trust Fund through foreclosure or deed-in-lieu of foreclosure, as
described in Section 3.13.
"Request for Release": A release signed by a Servicing Officer, in the
form of Exhibit E attached hereto.
"Reserve Account": The separate Eligible Account created and maintained
by the Trustee pursuant to Section 4.02(f) in the name of the Trustee for the
benefit of the Trust Fund and designated "JPMorgan Chase Bank, National
Association, as trustee, in trust for registered holders of the Ownit, Mortgage
Loan Asset-Backed Certificates, Series 2006-1." Funds in the Reserve Account
shall be held in trust for the Trust Fund for the uses and purposes set forth in
this Agreement.
"Residential Dwelling": Any one of the following: (i) a one-family
dwelling, (ii) a two- to four-family dwelling, (iii) a one-family dwelling unit
in a Xxxxxx Xxx eligible condominium project, (iv) a one-family dwelling in a
planned unit development, which is not a co-operative, or (v) a mobile or
manufactured home (as defined in 00 Xxxxxx Xxxxxx Code, Section 5402(6)).
"Residual Certificates": The Class R Certificates and the Class R-X
Certificates.
"Residual Interest": The sole Class of "residual interests" in each
REMIC within the meaning of Section 860G(a)(2) of the Code.
"Responsible Officer": When used with respect to the Trustee, any
officer assigned to the Corporate Trust Division (or any successor thereto),
including any Vice President, Assistant Vice President, Trust Officer, any
Assistant Secretary, any trust officer or any other officer of the Trustee
customarily performing functions similar to those performed by any of the above
designated officers and in each case having direct responsibility for the
administration of this Agreement.
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"S&P": Standard & Poor's, a division of The XxXxxx-Xxxx Companies,
Inc., and its successors, and if such company shall for any reason no longer
perform the functions of a securities rating agency, "S&P" shall be deemed to
refer to any other "nationally recognized statistical rating organization" as
set forth on the most current list of such organizations released by the
Securities and Exchange Commission.
"Second Lien Mortgage Loan": Any of the Mortgage Loans which are
secured by a second mortgage lien that is junior to a First Lien Mortgage Loan
on the related Mortgaged Property.
"Senior Enhancement Percentage": For any Distribution Date, the
percentage obtained by dividing (x) the sum of (i) the aggregate Certificate
Principal Balances of the Subordinated Certificates and (ii) the
Overcollateralization Amount, in each case before taking into account the
distribution of the Principal Distribution Amount on such Distribution Date by
(y) the Pool Balance as of the last day of the related Collection Period.
"Senior Specified Enhancement Percentage": On any date of determination
thereof, 44.90%.
"Servicer": Xxxxxx Loan Servicing LP, a Delaware limited partnership,
or any successor servicer appointed as herein provided, in its capacity as
Servicer hereunder.
"Servicer Affiliate": A Person (i) controlling, controlled by or under
common control with the Servicer or which is 50% or more owned by the Servicer
and (ii) which is qualified to service residential mortgage loans.
"Servicer Event of Termination": One or more of the events described in
Section 7.01.
"Servicer Modification": A modification to the terms of a Mortgage
Loan, in accordance with the terms of Section 3.01, as to which the Mortgagor is
in default or as to which, in the judgment of the Servicer, default is
reasonably foreseeable.
"Servicer Remittance Date": With respect to any Distribution Date, one
Business Day prior to such Distribution Date.
"Servicer's Assignee": As defined in Section 3.30(b) hereof.
"Servicing Advances": All customary, reasonable and necessary "out of
pocket" costs and expenses incurred by the Servicer in the performance of its
servicing obligations to the extent such costs or expenses constitute
"unanticipated expenses" within the meaning of Treasury Regulations
1.860G-1(b)(3)(ii), including, but not limited to, the cost of (i) the
preservation, restoration and protection of the Mortgaged Property, (ii) any
enforcement or judicial proceedings, including foreclosures, (iii) the
management and liquidation of the REO Property and (iv) compliance with the
obligations under Section 3.08.
"Servicing Criteria": The "servicing criteria" set forth in Item
1122(d) of Regulation AB, as such may be amended from time to time.
"Servicing Fee": With respect to each Mortgage Loan (including each REO
Property) and for any calendar month, an amount equal to one month's interest
(or in the event of any payment of interest which accompanies a Principal
Prepayment in full made by the Mortgagor during such calendar month, interest
for the number of days covered by such payment of interest) at the Servicing Fee
Rate on the same principal amount on which interest on such Mortgage Loan
accrues for such calendar month.
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"Servicing Fee Rate": With respect to each Mortgage Loan, 0.50% per
annum.
"Servicing Officer": Any officer of the Servicer involved in, or
responsible for, the administration and servicing of Mortgage Loans, whose name
and specimen signature appear on a list of servicing officers furnished by the
Servicer to the Trustee and the Depositor on the Closing Date, as such list may
from time to time be amended.
"Servicing Rights Pledgee": One or more lenders, selected by the
Servicer, to which the Servicer may pledge and assign all of its right, title
and interest in, to and under this Agreement, including JPMorgan Chase Bank,
National Association, as the representative of certain lenders.
"Servicing Standard": Shall mean the standards set forth in Section
3.01.
"Special Hazard Loss": Any Realized Losses that result from direct
physical damage to Mortgaged Properties caused by natural disasters and other
hazards (i) which are not covered by hazard insurance policies (such as
earthquakes) and (ii) for which claims have been submitted and rejected by the
related hazard insurer and any shortfall in insurance proceeds for partial
damage due to the application of the co-insurance clauses contained in hazard
insurance policies.
"SPV": As defined in Section 3.30(a) hereof.
"Sponsor": Credit-Based Asset Servicing and Securitization LLC, or its
successor in interest, in its capacity as seller under the Mortgage Loan
Purchase Agreement.
"Startup Day": As defined in Section 9.01(b) hereof.
"Stayed Funds": Any payment required to be made under the terms of the
Certificates and this Agreement but which is not remitted by the Servicer
because the Servicer is the subject of a proceeding under the Bankruptcy Code
and the making of such remittance is prohibited by Section 362 of the Bankruptcy
Code.
"Stepdown Date": The later to occur of (x) the earlier to occur of (A)
the Distribution Date in February 2009 and (B) the Distribution Date on which
the aggregate Certificate Principal Balance of the Class A Certificates is
reduced to zero, and (y) the first Distribution Date on which the Senior
Enhancement Percentage is greater than or equal to the Senior Specified
Enhancement Percentage.
"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 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 the
Servicer or a Subservicer.
"Subordinate Maximum Rate Cap": For any Distribution Date will be a per
annum rate (subject to adjustment in the case of the Class M Certificates based
on the actual number of days elapsed in the related Interest Accrual Period)
equal to the weighted average of the Group I Maximum Rate Cap and the Group II
Maximum Rate Cap weighted on the basis of the Group I Group Subordinate Amount
and the Group II Group Subordinate Amount, respectively.
"Subordinate Net WAC Cap": With respect to any Distribution Date, a per
annum rate (subject to adjustment in the case of the Class M Certificates based
on the actual number of days elapsed in the related Interest Accrual Period)
equal to the weighted average of the Group I Net WAC Cap and the Group II Net
WAC Cap, weighted on the basis of the Group I Group Subordinate Amount and the
Group II Group Subordinate Amount, respectively.
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"Subordinated Certificates": The Class M-1, Class M-2, Class M-3, Class
M-4, Class M-5, Class M-6, Class B-1, Class B-2, Class B-3, Class B-4, Class
B-5, Class N, Class X, Class R and Class R-X Certificates.
"Subsequent Overcollateralization Amount": As of any Distribution Date,
after the application of principal payments and Applied Realized Loss Amounts,
an amount equal to the excess, if any of (a) the Pool Balance over (b) the sum
of (i) the Certificate Principal Balance of each Class of the Class A, Class M
and Class B Certificates and (ii) the remaining Initial Overcollateralization
Amount.
"Subsequent Recovery": Any amount received on a Mortgage Loan
subsequent to such Mortgage Loan being determined to be a Liquidated Mortgage
Loan.
"Subservicer": Any Person that services Mortgage Loans on behalf of the
Servicer or any Subservicer and is responsible for the performance (whether
directly or through Subservicers or Subcontractors) of a substantial portion of
the material servicing functions required to be performed by the Servicer under
this Agreement, with respect to some or all of the Mortgage Loans, that are
identified in Item 1122(d) of Regulation AB.
"Substitution Adjustment Amount": As defined in Section 2.03(d) hereof.
"Targeted Overcollateralization Amount": As of any Distribution Date,
(x) prior to the Stepdown Date, 2.30% of the Pool Balance on the Cut-off Date
and (y) on and after the Stepdown Date, (i) if a Trigger Event has not occurred,
the lesser of (a) 2.30% of the Pool Balance on the Cut-off Date and (b) the
greater of (A) 4.60% of the Pool Balance as of the last day of the related
Collection Period and (B) 0.50% of the Pool Balance on the Cut-off Date and (ii)
if a Trigger Event has occurred, the Targeted Overcollateralization Amount for
the immediately preceding Distribution Date. Notwithstanding the foregoing, on
and after any Distribution Date following the reduction of the aggregate
Certificate Principal Balance of the Class A, Class M and Class B Certificates
to zero, the Targeted Overcollateralization Amount shall be zero.
"Tax Matters Person": The tax matters person appointed pursuant to
Section 9.01(e) hereof.
"Tax Returns": The federal income tax returns on Internal Revenue
Service Form 1066, U.S. Real Estate Mortgage Investment Conduit Income Tax
Return, including Schedule Q thereto, Quarterly Notice to Residual Interest
Holders of the REMIC Taxable Income or Net Loss Allocation, or any successor
forms, to be filed on behalf of the Trust for each of the REMICs created
pursuant to this Agreement under the REMIC Provisions, together with any and all
other information reports or returns that may be required to be furnished to the
Certificateholders or filed with the Internal Revenue Service or any other
governmental taxing authority under any applicable provisions of federal, state
or local tax laws.
"Telerate Page 3750": The display page currently so designated on the
Moneyline Telerate Service (or such other page as may replace the Telerate Page
3750 page on that service for the purpose of displaying London interbank offered
rates of major banks).
"Termination Price": As defined in Section 10.01(a) hereof.
47
"Trigger Event": With respect to any Distribution Date, if (i) the
six-month rolling average of 60+ Day Delinquent Loans equals or exceeds 34.52%
of the Senior Enhancement Percentage or (ii) the aggregate amount of Realized
Losses incurred since the Cut-off Date through the last day of the related
Collection Period divided by the Pool Balance as of the Cut-off Date exceeds the
applicable percentages set forth below with respect to such Distribution Date:
DISTRIBUTION DATE OCCURRING IN PERCENTAGE
------------------------------ ----------
February 2008 through January 2009 1.20%
February 2009 through January 2010 2.25%
February 2010 through January 2011 3.00%
February 2011 through January 2012 3.50%
February 2012 and thereafter 3.75%
"Trust": Ownit Mortgage Loan Trust, Series 2006-1 Trust, the trust
created hereunder.
"Trust Fund": The segregated pool of assets subject hereto,
constituting the primary trust created hereby and to be administered hereunder,
with respect to a portion of which REMIC elections are to be made, such entire
Trust Fund consisting of: (i) such Mortgage Loans as from time to time are
subject to this Agreement, together with the Mortgage Files relating thereto,
and together with all collections thereon and proceeds thereof, (ii) any REO
Property, together with all collections thereon and proceeds thereof, (iii) the
Trustee's rights with respect to the Mortgage Loans under all insurance policies
required to be maintained pursuant to this Agreement and any proceeds thereof,
(iv) the Depositor's rights under the Mortgage Loan Purchase Agreement
(including any security interest created thereby), (v) the Cap Contracts and
Reserve Account and (vi) the Collection Account, the Distribution Account and
any REO Account and such assets that are deposited therein from time to time and
any investments thereof, together with any and all income, proceeds and payments
with respect thereto.
"Trustee": JPMorgan Chase Bank, National Association, a banking
association organized and existing under the laws of United States of America,
or any successor Trustee appointed as herein provided.
"Trustee Fee": With respect to any Distribution Date, the product of
(x) one-twelfth of the Trustee Fee Rate and (y) the aggregate of the Principal
Balances of all Mortgage Loans as of the opening of business on the first day of
the related Collection Period.
"Trustee Fee Rate": With respect to any Distribution Date, 0.0025% per
annum.
"Underwriter": Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated, as
underwriter with respect to the Offered Certificates.
"United States Person" or "U.S. Person": (i) A citizen or resident of
the United States, (ii) a corporation, partnership or other entity treated as a
corporation or partnership for United States federal income tax purposes
organized in or under the laws of the United States or any state thereof or the
District of Columbia (unless, in the case of a partnership, Treasury regulations
provide otherwise) or (iii) an estate the income of which is includible in gross
income for United States tax purposes, regardless of its source, or (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 persons have
authority to control all substantial decisions of the trust. Notwithstanding the
preceding sentence, to the extent provided in Treasury regulations, certain
Trusts in existence on August 20, 1996, and treated as United States persons
prior to such date, that elect to continue to be treated as United States
persons will also be a U.S. Person.
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"Unpaid Realized Loss Amount": For any Class X-0, Xxxxx X-0, Class M-3,
Class M-4, Class M-5, Class M-6, Class B-1, Class B-2, Class B-3, Class B-4 and
Class B-5 Certificates and as to any Distribution Date, the excess of (1) the
cumulative amount of related Applied Realized Loss Amounts with respect to such
Class for all prior Distribution Dates over (2) the sum of (x) the cumulative
amount of related Realized Loss Amortization Amounts with respect to such Class
for all prior Distribution Dates and (y) all increases in the Certificate
Principal Balance of such Class pursuant to the last sentence of the definition
of "Certificate Principal Balance."
"Value": With respect to any Mortgaged Property, the lower of the value
thereof as determined by an independent appraisal made at the time of the
origination of the related Mortgage Loan or the sale price, if the appraisal is
not available; except that, with respect to any Mortgage Loan that is a purchase
money mortgage loan, the lesser of (i) the value thereof as determined by an
independent appraisal made at the time of the origination of such Mortgage Loan,
if any, and (ii) the sales price of the related Mortgaged Property.
"Voting Rights": The portion of the voting rights of all of the
Certificates which is allocated to any Certificate. The Voting Rights allocated
among Holders of the Class A, Class M and Class B Certificates shall be 98%, and
shall be allocated among each such Class according to the fraction, expressed as
a percentage, the numerator of which is the aggregate Certificate Principal
Balance of all the Certificates of such Class then outstanding and the
denominator of which is the aggregate Certificate Principal Balance of all the
Class A, Class M and Class B Certificates then outstanding. The Voting Rights
allocated to each such Class of Certificates shall be allocated among all
holders of each such Class in proportion to the outstanding Certificate
Principal Balance of such Certificates; provided, however, that any Certificate
registered in the name of the Servicer, the Depositor or the Trustee or any of
their respective affiliates shall not be included in the calculation of Voting
Rights; provided that only such Certificates as are known by a Responsible
Officer of the Trustee to be so registered will be so excluded. On each
Distribution Date (a) prior to the date on which the Notional Amount of the
Class N Certificates is reduced to zero, the percentage of all the Voting Rights
allocated among the Holders of the Class N and Class X Certificates,
respectively, shall be 1% and (b) on and after the date on which the Notional
Amount of the Class N Certificates is reduced to zero, the percentage of all the
Voting Rights allocated among the Holders of the Class N Certificates shall be
0% and the percentage of all the Voting Rights allocated among the Holder of the
Class X Certificates shall be 2%. The Residual Certificates shall have no Voting
Rights.
"Written Order to Authenticate": A written order by which the Depositor
directs the Trustee to execute, authenticate and deliver the Certificates.
Section 1.02 Accounting.
Unless otherwise specified herein, for the purpose of any definition or
calculation, whenever amounts are required to be netted, subtracted or added or
any distributions are taken into account such definition or calculation and any
related definitions or calculations shall be determined without duplication of
such functions.
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ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
ORIGINAL ISSUANCE OF CERTIFICATES
Section 2.01 Conveyance of Mortgage Loans.
The Depositor, concurrently with the execution and delivery hereof,
does hereby transfer, assign, set over and otherwise convey to the Trustee, on
behalf of the Trust, without recourse, for the benefit of the
Certificateholders, all the right, title and interest of the Depositor,
including any security interest therein for the benefit of the Depositor, in and
to (i) each Mortgage Loan identified on the Mortgage Loan Schedule, including
the related Cut-off Date Principal Balance, all interest accruing thereon after
the Cut-off Date and all collections in respect of interest and principal due
after the Cut-off Date; (ii) property which secured each such Mortgage Loan and
which has been acquired by foreclosure or deed in lieu of foreclosure; (iii) its
interest in any insurance policies in respect of the Mortgage Loans; (iv) all
proceeds of any of the foregoing; (v) the rights of the Depositor under the
Mortgage Loan Purchase Agreement, and (vi) all other assets included or to be
included in the Trust Fund. Such assignment includes all interest and principal
due to the Depositor or the Servicer after the Cut-off Date with respect to the
Mortgage Loans.
The Depositor, the Sponsor, the Servicer and the Trustee hereto agree
and understand that it is not intended that any Mortgage Loan be included in the
Trust Fund that is, without limitation, a "High-Cost Home Loan" as defined by
the Home Ownership and Equity Protection Act of 1994 or any other applicable
anti-predatory lending laws, including but not limited to (i) a "High-Cost Home
Loan" as defined in the New Jersey Home Ownership Act effective November 27,
2003; (ii) a "High-Cost Home Loan" as defined in the New Mexico Home Loan
Protection Act effective January 1, 2004; (iii) a "High-Cost Home Loan" as
defined in the Massachusetts Predatory Home Loan Practices Act effective
November 7, 2004 (iv) a "High-Cost Home Loan" as defined by the Indiana High
Cost Home Loan Law effective January 1, 2005; or (v) a "High-Cost Home Loan" as
defined by the Illinois High-Risk Home Loan Act effective January 1, 2004.
In connection with such transfer and assignment, the Sponsor, on behalf
of the Depositor, does hereby deliver to, and deposit with the Trustee, or its
designated agent (the "Custodian"), the following documents or instruments with
respect to each Mortgage Loan (a "Mortgage File") so transferred and assigned:
(i) the original Mortgage Note including any riders thereto, endorsed
either (A) in blank or (B) in the following form: "Pay to the order of JPMorgan
Chase Bank, National Association, as Trustee for the Ownit Mortgage Loan
Asset-Backed Certificates, Series 2006-1, without recourse," or with respect to
any lost Mortgage Note, an original Lost Note Affidavit, together with a copy of
the related Mortgage Note;
(ii) the original Mortgage including any riders thereto, with evidence
of recording thereon, and the original recorded power of attorney, if the
Mortgage was executed pursuant to a power of attorney, with evidence of
recording thereon or, if such Mortgage or power of attorney has been submitted
for recording but has not been returned from the applicable public recording
office, has been lost or is not otherwise available, a copy of such Mortgage or
power of attorney, as the case may be, certified to be a true and complete copy
of the original submitted for recording;
(iii) an original Assignment of Mortgage, in form and substance
acceptable for recording. The Mortgage shall be assigned either (A) in blank or
(B) to "JPMorgan Chase Bank, National Association, as Trustee for the Ownit
Mortgage Loan Asset-Backed Certificates, Series 2006-1, without recourse";
50
(iv) an original or a certified copy of any intervening assignment of
Mortgage showing a complete chain of assignments;
(v) the original or a certified copy of lender's title insurance
policy; and
(vi) the original or copies of each assumption, modification, written
assurance or substitution agreement, if any.
The Trustee agrees to execute and deliver (or cause the Custodian to
execute and deliver) to the Depositor on or prior to the Closing Date an
acknowledgment of receipt of the original Mortgage Note (with any exceptions
noted), substantially in the form attached as Exhibit F-3 hereto.
If any of the documents referred to in Section 2.01(ii), (iii) or (iv)
above has as of the Closing Date been submitted for recording but either (x) has
not been returned from the applicable public recording office or (y) has been
lost or such public recording office has retained the original of such document,
the obligations of the Sponsor to deliver such documents shall be deemed to be
satisfied upon (1) delivery to the Trustee or the Custodian no later than the
Closing Date, of a copy of each such document certified by the Sponsor in the
case of (x) above or the applicable public recording office in the case of (y)
above to be a true and complete copy of the original that was submitted for
recording and (2) if such copy is certified by the Sponsor, delivery to the
Trustee or the Custodian, promptly upon receipt thereof of either the original
or a copy of such document certified by the applicable public recording office
to be a true and complete copy of the original. The Sponsor shall deliver or
cause to be delivered to the Trustee or the Custodian promptly upon receipt
thereof any other documents constituting a part of a Mortgage File received with
respect to any Mortgage Loan, including, but not limited to, any original
documents evidencing an assumption or modification of any Mortgage Loan.
Upon discovery or receipt of notice of any materially defective
document in, or that a document is missing from, a Mortgage File, the Sponsor
shall have 120 days to cure such defect or 150 days following the Closing Date,
in the case of missing Mortgages or Assignments or deliver such missing document
to the Trustee or the Custodian. If the Sponsor does not cure such defect or
deliver such missing document within such time period, and such failure to
deliver or cure, as applicable, would have a material and adverse effect on
Certificateholders, the Sponsor shall either repurchase or substitute for such
Mortgage Loan in accordance with Section 2.03.
The Servicer shall cause the Assignments of Mortgage which were
delivered in blank to be completed and shall cause all Assignments referred to
in Section 2.01(iii) hereof and, to the extent necessary, in Section 2.01(iv)
hereof to be recorded at the Servicer's expense and of no cost to the Trust
Fund; provided, however, the Servicer need not cause to be recorded any
Assignment which relates to a Mortgage Loan in any jurisdiction under the laws
of which, as evidenced by an Opinion of Counsel delivered by the Servicer to the
Trustee and the Rating Agencies, the recordation of such assignment is not
necessary to protect the Trustee's interest, on behalf of the Trust, in the
related Mortgage Loan. The Servicer shall be required to deliver such
assignments for recording within 30 days of the Closing Date. The Servicer shall
furnish the Trustee, or its designated agent, with a copy of each assignment of
Mortgage submitted for recording. In the event that any such Assignment is lost
or returned unrecorded because of a defect therein, the Servicer shall promptly
have a substitute Assignment prepared or have such defect cured, as the case may
be, and thereafter cause each such Assignment to be duly recorded. In the event
that any Mortgage Note is endorsed in blank as of the Closing Date, promptly
following the Closing Date the Servicer shall cause to be completed such
endorsements "Pay to the order of JPMorgan Chase Bank, National Association, as
Trustee for the Ownit Mortgage Loan Asset-Backed Certificates, Series 2006-1,
without recourse."
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In the event that any Assignments of Mortgage is not recorded or is
improperly recorded (as a result of actions taken or not taken by a person other
than the Servicer), neither the Servicer nor the Trustee shall have any
liability for its failure to receive notices related to such Assignment of
Mortgage.
The Depositor herewith delivers to the Trustee executed copies of the
Mortgage Loan Purchase Agreement.
Section 2.02 Acceptance by Trustee.
The Trustee acknowledges the Custodian's receipt of, subject to the
provisions of Section 2.01 and subject to the review described below and any
exceptions noted on the exception report described in the next paragraph below,
the documents referred to in Section 2.01 above and all other assets included in
the definition of "Trust Fund" and declares that the Custodian holds and will
hold such documents and the other documents delivered to it constituting a
Mortgage File, and that the Custodian holds or will hold all such assets and
such other assets included in the definition of "Trust Fund" in trust for the
exclusive use and benefit of all present and future Certificateholders.
The Custodian shall review each Mortgage File within 60 days after the
Closing Date (or, with respect to any document delivered after the Startup Day,
within 60 days of receipt and with respect to any Qualified Substitute Mortgage,
within 60 days after the assignment thereof) and the Custodian shall certify in
substantially the form attached hereto as Exhibit F-1 that, as to each Mortgage
Loan listed in the Mortgage Loan Schedule (other than any Mortgage Loan paid in
full or any Mortgage Loan specifically identified in the exception report
annexed thereto as not being covered by such certification), (i) all documents
required to be delivered to it pursuant to Section 2.01 of this Agreement are in
its possession, (ii) such documents have been reviewed by it and have not been
mutilated, damaged or torn and relate to such Mortgage Loan and (iii) based on
its examination and only as to the foregoing, the information set forth in the
Mortgage Loan Schedule that corresponds to items (1), (2), (3), (5), (13) and
(26) (in the case of (26), only as to whether there is a prepayment penalty) of
the Mortgage Loan Schedule accurately reflects information set forth in the
Mortgage File. It is herein acknowledged that, in conducting such review, the
Custodian is under no duty or obligation to inspect, review or examine any such
documents, instruments, certificates or other papers to determine that they are
genuine, enforceable, or appropriate for the represented purpose or that they
have actually been recorded or that they are other than what they purport to be
on their face.
Prior to the first anniversary date of this Agreement the Custodian
shall deliver to the Depositor and the Servicer a final certification in the
form annexed hereto as Exhibit F-2 evidencing the completeness of the Mortgage
Files, with any applicable exceptions noted thereon.
If in the process of reviewing the Mortgage Files and making or
preparing, as the case may be, the certifications referred to above, the
Custodian finds any document or documents constituting a part of a Mortgage File
to be missing or defective in any material respect, at the conclusion of its
review the Custodian shall so notify the Sponsor, the Depositor and the
Servicer. In addition, upon the discovery by the Sponsor, Depositor, the Trustee
or the Servicer (or upon receipt by the Trustee of written notification of such
breach) of a breach of any of the representations and warranties made by the
Sponsor in the related Mortgage Loan Purchase Agreement in respect of any
Mortgage Loan which materially adversely affects such Mortgage Loan or the
interests of the related Certificateholders in such Mortgage Loan, the party
discovering such breach shall give prompt written notice to the other parties.
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The Depositor and the Trustee intend that the assignment and transfer
herein contemplated constitute a sale of the Mortgage Loans and the Related
Documents, conveying good title thereto free and clear of any liens and
encumbrances, from the Depositor to the Trustee and that such property not be
part of the Depositor's estate or property of the Depositor in the event of any
insolvency by the Depositor. In the event that such conveyance is deemed to be,
or to be made as security for, a loan, the parties intend that the Depositor
shall be deemed to have granted and does hereby grant to the Trustee, on behalf
of the Trust, a first priority perfected security interest in all of the
Depositor's right, title and interest in and to the Mortgage Loans and the
Related Documents, and that this Agreement shall constitute a security agreement
under applicable law.
The Trustee is hereby directed to execute and deliver the Cap Contracts
on the Closing Date and thereafter on behalf of the Trust Fund for the benefit
of the Holders of the Class AV and Class M Certificates. The Sponsor, the
Servicer, the Depositor and the Holders of the Class AV and Class M Certificates
by acceptance of their Certificates acknowledge and agree that the Trustee shall
execute and deliver the Cap Contracts and shall do so solely in its capacity as
Trustee of the Trust Fund and not in its individual capacity.
The Trustee is hereby directed to represent and warrant on behalf of
the Trust Fund to the Cap Contract Provider under each of the Cap Contracts that
the beneficial owner for United States federal income tax purposes of payments
made under each of the Cap Contracts is either:
(A) a "U.S. person" (as that term is used in section
1.1441-4(a)(3)(ii) of United States Treasury Regulations (the
"Regulations")) for United States federal income tax purposes,
or
(B) a "non-U.S. branch of a foreign person" as that term is used
in section 1.1441-4(a)(3)(ii) of the Regulations for United
States federal income tax purposes, and a "foreign person" as
that term is used in section 1.6041-4(a)(4) of the Regulations
for United States federal income tax purposes.
Section 2.03 Repurchase or Substitution of Mortgage Loans by the
Sponsor.
(a) Upon discovery or receipt of written notice of any materially
defective document in, or that a document is missing from, a Mortgage File or of
the breach by the Sponsor of any representation, warranty or covenant under the
Mortgage Loan Purchase Agreement or in Section 2.04 in respect of any Mortgage
Loan which materially adversely affects the value of such Mortgage Loan or the
interest therein of the Certificateholders, the Trustee (or the Custodian, as
applicable) shall promptly notify the Sponsor, the Servicer and the Trustee of
such defect, missing document or breach and request that the Sponsor deliver
such missing document or cure such defect or breach within 120 days or 150 days
following the Closing Date, in the case of missing Mortgages or Assignments from
the date the Sponsor was notified of such missing document, defect or breach,
and if the Sponsor does not deliver such missing document or cure such defect or
breach in all material respects during such period, and such missing document,
defect or breach will have a material and adverse effect on the
Certificateholders, the Trustee shall enforce the Sponsor's obligation under the
Mortgage Loan Purchase Agreement and inform the Sponsor of its obligation to
repurchase such Mortgage Loan from the Trust Fund at the Purchase Price on or
prior to the Determination Date following the expiration of such 120 day period
(subject to Section 2.03(e)); provided that, in connection with any such breach
that is susceptible to cure but that could not reasonably have been cured within
such 120 day or 150 day period, if the Sponsor shall have commenced to cure such
breach within such 120 day or 150 day period, the Sponsor shall be permitted to
proceed thereafter diligently and expeditiously to cure the same within 120
days. The Purchase Price for the repurchased Mortgage Loan shall be deposited in
the Collection Account, and the Trustee, upon receipt of written certification
from the Servicer of such deposit, shall release to the Sponsor the related
Mortgage File and shall execute and deliver such instruments of transfer or
assignment, in each case without recourse, representation or warranty, as the
Sponsor shall furnish to it and as shall be necessary to vest in the Sponsor any
Mortgage Loan released pursuant hereto and the Trustee shall have no further
responsibility with regard to such Mortgage File. In lieu of repurchasing any
such Mortgage Loan as provided above, the Sponsor may cause such Mortgage Loan
to be removed from the Trust Fund (in which case it shall become a Defective
Mortgage Loan) and substitute one or more Eligible Substitute Mortgage Loans in
the manner and subject to the limitations set forth in Section 2.03(d). In
addition to the foregoing, in the case of a breach of the Sponsor's
representation set forth in Section 3.01(f) of the Mortgage Loan Purchase
Agreement, the Sponsor shall reimburse the Trust for all costs or damages
incurred by the Trust as a result of the violation of such law (such amount, the
"Reimbursement Amount"). The Reimbursement Amount shall be delivered to the
Servicer for deposit into the Collection Account within 10 days from the date
the Sponsor was notified by the Trustee of the amount of such costs and damages.
It is understood and agreed that the obligation of the Sponsor to pay the
Reimbursement Amount and to either cure or repurchase (or substitute for) any
Mortgage Loan as to which a document is missing, a material defect in a
constituent document exists or as to which such a breach has occurred and is
continuing shall constitute the sole remedy against the Sponsor respecting such
omission, defect or breach available to the Trustee and the Trustee on behalf of
the Certificateholders.
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(b) [Reserved].
(c) Within 90 days of the earlier of discovery by the Servicer or
receipt of notice by the Servicer of the breach of any representation, warranty
or covenant of the Servicer set forth in Section 2.05 which materially and
adversely affects the interests of the Certificateholders in any Mortgage Loan,
the Servicer shall cure such breach in all material respects.
(d) Any substitution of Eligible Substitute Mortgage Loans for
Defective Mortgage Loans made pursuant to Section 2.03(a) must be effected prior
to the last Business Day that is within two years after the Closing Date. As to
any Defective Mortgage Loan for which the Sponsor substitutes an Eligible
Substitute Mortgage Loan or Loans, such substitution shall be effected by the
Sponsor delivering to the Trustee for such Eligible Substitute Mortgage Loan or
Loans, the Mortgage Note, the Mortgage, the Assignment to the Trustee, and such
other documents and agreements, with all necessary endorsements thereon, as are
required by Section 2.01, together with an Officer's Certificate providing that
each such Eligible Substitute Mortgage Loan satisfies the definition thereof and
specifying the Substitution Adjustment Amount (as described below), if any, in
connection with such substitution. The Trustee shall acknowledge receipt for
such Eligible Substitute Mortgage Loan or Loans and, within ten Business Days
thereafter, shall review (or cause the Custodian to review) such documents as
specified in Section 2.02 and deliver (or cause the Custodian to deliver) to the
Servicer, with respect to such Eligible Substitute Mortgage Loan or Loans, a
certification substantially in the form attached hereto as Exhibit F-1, with any
applicable exceptions noted thereon. Within one year of the date of
substitution, the Trustee shall deliver (or cause the Custodian to deliver) to
the Servicer a certification substantially in the form of Exhibit F-2 hereto
with respect to such Eligible Substitute Mortgage Loan or Loans, with any
applicable exceptions noted thereon. Monthly Payments due with respect to
Eligible Substitute Mortgage Loans in the month of substitution are not part of
the Trust Fund and will be retained by the Sponsor. For the month of
substitution, distributions to Certificateholders will reflect the collections
and recoveries in respect of such Defective Mortgage Loan in the Collection
Period preceding the month of substitution and the Depositor or the Sponsor, as
the case may be, shall thereafter be entitled to retain all amounts subsequently
received in respect of such Defective Mortgage Loan. The Sponsor shall give or
cause to be given written notice to the Certificateholders that such
substitution has taken place, shall amend the Mortgage Loan Schedule to reflect
the removal of such Defective Mortgage Loan from the terms of this Agreement and
the substitution of the Eligible Substitute Mortgage Loan or Loans and shall
deliver a copy of such amended Mortgage Loan Schedule to the Trustee. Upon such
substitution, such Eligible Substitute Mortgage Loan or Loans shall constitute
part of the Mortgage Pool and shall be subject in all respects to the terms of
this Agreement and, in the case of a substitution effected by the Sponsor, the
Mortgage Loan Purchase Agreement, including, in the case of a substitution
effected by the Sponsor all applicable representations and warranties thereof
included in the Mortgage Loan Purchase Agreement and all applicable
representations and warranties thereof set forth in Section 2.04, in each case
as of the date of substitution.
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For any month in which the Sponsor substitutes one or more Eligible
Substitute Mortgage Loans for one or more Defective Mortgage Loans, the Servicer
will determine the amount (the "Substitution Adjustment Amount"), if any, by
which the aggregate Purchase Price of all such Defective Mortgage Loans exceeds
the aggregate, as to each such Eligible Substitute Mortgage Loan, of the
principal balance thereof as of the date of substitution, together with one
month's interest on such principal balance at the applicable Net Mortgage
Interest Rate. On the date of such substitution, the Sponsor will deliver or
cause to be delivered to the Servicer for deposit in the Collection Account an
amount equal to the Substitution Adjustment Amount, if any, and the Trustee,
upon receipt by it or the Custodian of the related Eligible Substitute Mortgage
Loan or Loans and certification by the Servicer of such deposit, shall release
to the Sponsor the related Mortgage File or Files and shall execute and deliver
such instruments of transfer or assignment, in each case without recourse,
representation or warranty, as the Sponsor shall deliver to it and as shall be
necessary to vest therein any Defective Mortgage Loan released pursuant hereto.
In addition, the Sponsor shall obtain at its own expense and deliver to
the Trustee an Opinion of Counsel to the effect that such substitution will not
cause (a) any federal tax to be imposed on the Trust Fund, including without
limitation, any federal tax imposed on "prohibited transactions" under Section
860F(a)(l) of the Code or on "contributions after the startup date" under
Section 860G(d)(l) of the Code, or (b) any REMIC formed under this Agreement to
fail to qualify as a REMIC at any time that any Certificate is outstanding. 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.
(e) Upon discovery by the Sponsor, the Servicer or the Trustee that any
Mortgage Loan does not constitute a "qualified mortgage" within the meaning of
Section 860G(a)(3) of the Code, the party discovering such fact shall within two
Business Days give written notice thereof to the other parties. In connection
therewith, the Sponsor shall repurchase or, subject to the limitations set forth
in Section 2.03(d), substitute one or more Eligible Substitute Mortgage Loans
for the affected Mortgage Loan within 90 days of the earlier of discovery or
receipt of such notice with respect to such affected Mortgage Loan. In addition,
upon discovery that a Mortgage Loan is defective in a manner that would cause it
to be a "defective obligation" within the meaning of Treasury regulations
relating to REMICs, the Sponsor shall cure the defect or make the required
purchase or substitution no later than 90 days after the discovery of the
defect. Any such repurchase or substitution shall be made in the same manner as
set forth in Section 2.03(a), if made by the Sponsor. The Trustee shall reconvey
to the Sponsor the Mortgage Loan to be released pursuant hereto in the same
manner, and on the same terms and conditions, as it would a Mortgage Loan
repurchased for breach of a representation or warranty.
Notwithstanding anything to the contrary contained herein, the parties
hereto acknowledge that the functions of the Trustee with respect to the
custody, acceptance, inspection and release of the Mortgage Files pursuant to
Sections 2.01, 2.02 and 2.03 and preparation and delivery of the certifications
in the form of Exhibit F-1 and Exhibit F-2 shall be performed by the Custodian
pursuant to the terms and conditions of the Custodial Agreement. The fees and
expenses of the Custodian shall be paid by the Servicer.
55
Section 2.04 Representations and Warranties of the Sponsor with Respect
to the Mortgage Loans.
The Sponsor hereby represents and warrants to the Trustee for the
benefit of the Certificateholders that as of the Closing Date or as of such
other date specifically provided herein:
(a) The representations and warranties made by the Sponsor pursuant to
Section 3.01 of the Mortgage Loan Purchase Agreement are hereby being made to
the Trustee and are true and correct as of the Closing Date.
(b) Any written agreement between the Mortgagor in respect of a
Mortgage Loan and the Servicer modifying such Mortgagor's obligation to make
payments under the Mortgage Loan (such modified Mortgage Loan, a "Modified
Mortgage Loan") involved some assessment of the Mortgagor's ability to repay the
Modified Mortgage Loan.
With respect to the representations and warranties set forth in this
Section 2.04 that are made to the best of the Sponsor's knowledge or as to which
the Sponsor has no knowledge, if it is discovered by the Depositor, the Sponsor,
the Servicer or the Trustee that the substance of such representation and
warranty is inaccurate and such inaccuracy materially and adversely affects the
value of the related Mortgage Loan or the interest therein of the
Certificateholders then, notwithstanding the Sponsor's lack of knowledge with
respect to the substance of such representation and warranty being inaccurate at
the time the representation or warranty was made, such inaccuracy shall be
deemed a breach of the applicable representation or warranty.
Upon discovery by the Depositor, the Sponsor, the Servicer or the
Trustee of a breach of any of the representations and warranties contained in
this Section that materially and adversely affects the value of any Mortgage
Loan or the interest therein of the Certificateholders, the party discovering
the breach shall give prompt written notice to the others and in no event later
than two Business Days from the date of such discovery. Within ninety days of
its discovery or its receipt of notice of any such missing or materially
defective documentation or any such breach of a representation or warranty, the
Sponsor shall promptly deliver such missing document or cure such defect or
breach in all material respects, or in the event such defect or breach cannot be
cured, the Sponsor shall repurchase the affected Mortgage Loan or cause the
removal of such Mortgage Loan from the Trust Fund and substitute for it one or
more Eligible Substitute Mortgage Loans, in either case, in accordance with
Section 2.03.
It is understood and agreed that the representations and warranties set
forth in this Section 2.04 shall survive delivery of the Mortgage Files to the
Trustee and shall inure to the benefit of the Certificateholders notwithstanding
any restrictive or qualified endorsement or assignment. It is understood and
agreed that the obligations of the Sponsor set forth in Section 2.03(a) and (c)
to cure, substitute for or repurchase a Mortgage Loan pursuant to the Mortgage
Loan Purchase Agreement and to reimburse the Trust the Reimbursement Amount,
constitute the sole remedies available to the Certificateholders or to the
Trustee on their behalf respecting a breach of the representations and
warranties contained in this Section 2.04.
Section 2.05 Representations, Warranties and Covenants of the Servicer.
The Servicer hereby represents, warrants and covenants to the Trustee,
for the benefit of each of the Trustee and the Certificateholders and to the
Depositor that as of the Closing Date or as of such date specifically provided
herein:
56
(i) The Servicer is duly organized, validly existing, and in good
standing under the laws of the jurisdiction of its formation and has all
licenses necessary to carry on its business as now being conducted, except for
such licenses, certificates and permits the absence of which, individually or in
the aggregate, would not have a material adverse effect on the ability of the
Servicer to conduct its business as it is presently conducted, and is licensed,
qualified and in good standing in the states where the Mortgaged Property is
located if the laws of such state require licensing or qualification in order to
conduct business of the type conducted by the Servicer or to ensure the
enforceability or validity of each Mortgage Loan; the Servicer has the power and
authority to execute and deliver this Agreement and to perform in accordance
herewith; the execution, delivery and performance of this Agreement (including
all instruments of transfer to be delivered pursuant to this Agreement) by the
Servicer and the consummation of the transactions contemplated hereby have been
duly and validly authorized; this Agreement evidences the valid, binding and
enforceable obligation of the Servicer, subject to applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally; and all requisite corporate action
has been taken by the Servicer to make this Agreement valid and binding upon the
Servicer in accordance with its terms;
(ii) The consummation of the transactions contemplated by this
Agreement are in the ordinary course of business of the Servicer and will not
result in the breach of any term or provision of the certificate of formation or
the partnership agreement of the Servicer or result in the breach of any term or
provision of, or conflict with or constitute a default under or result in the
acceleration of any obligation under, any agreement, indenture or loan or credit
agreement or other instrument to which the Servicer or its property is subject,
or result in the violation of any law, rule, regulation, order, judgment or
decree to which the Servicer or its property is subject;
(iii) The Servicer is an approved servicer of conventional mortgage
loans for Xxxxxx Xxx and has the facilities, procedures and experienced
personnel necessary for the sound servicing of mortgage loans of the same type
as the Mortgage Loans. The Servicer is, and shall remain for as long as it is
servicing the Mortgage Loans hereunder, in good standing to service mortgage
loans for HUD, Xxxxxx Mae or Xxxxxxx Mac, and no event has occurred, including
but not limited to a change in insurance coverage, which would make the Servicer
unable to comply with HUD, Xxxxxx Mae or Xxxxxxx Mac eligibility requirements or
which would require notification to any of HUD, Xxxxxx Mae or Xxxxxxx Mac;
(iv) This Agreement, and all documents and instruments contemplated
hereby which are executed and delivered by the Servicer, constitute and will
constitute valid, legal and binding obligations of the Servicer, enforceable in
accordance with their respective terms, except as the enforcement thereof may be
limited by applicable bankruptcy laws and general principles of equity;
(v) The Servicer does not believe, nor does it have any reason or cause
to believe, that it cannot perform each and every covenant contained in this
Agreement;
(vi) There is no action, suit, proceeding or investigation pending or,
to its knowledge, threatened against the Servicer that, either individually or
in the aggregate, may result in any material adverse change in the business,
operations, financial condition, properties or assets of the Servicer, or in any
material impairment of the right or ability of the Servicer to carry on its
business substantially as now conducted, or in any material liability on the
part of the Servicer, or that would draw into question the validity or
enforceability of this Agreement or of any action taken or to be taken in
connection with the obligations of the Servicer contemplated herein, or that
would be likely to impair materially the ability of the Servicer to perform
under the terms of this Agreement;
57
(vii) No consent, approval or order of any court or governmental agency
or body is required for the execution, delivery and performance by the Servicer
of or compliance by the Servicer with this Agreement or the consummation of the
transactions contemplated by this Agreement, except for such consents,
approvals, authorizations and orders, if any, that have been obtained;
(viii) Neither this Agreement nor any information, certificate of an
officer, statement furnished in writing or report delivered to the Trustee by
the Servicer in connection with the transactions contemplated hereby contains or
will contain any untrue statement of a material fact or omits or will omit to
state a material fact necessary in order to make the statements contained
therein, in light of the circumstances under which they were made, not
misleading; and
(ix) The Servicer has fully furnished, and shall continue to fully
furnish for so long as it is servicing the Mortgage Loans hereunder, in
accordance with the Fair Credit Reporting Act and its implementing regulations,
accurate and complete information on the Mortgagor credit files to Equifax,
Experian and Trans Union Credit Information Company on a monthly basis.
It is understood and agreed that the representations, warranties and
covenants set forth in this Section 2.05 shall survive delivery of the Mortgage
Files to the Trustee and shall inure to the benefit of the Trustee, the
Depositor and the Certificateholders. Upon discovery by any of the Depositor,
the Servicer, the Sponsor or the Trustee of a breach of any of the foregoing
representations, warranties and covenants which materially and adversely affects
the value of any Mortgage Loan or the interests therein of the
Certificateholders, the party discovering such breach shall give prompt written
notice (but in no event later than two Business Days following such discovery)
to the other parties hereto.
Section 2.06 Representations and Warranties of the Depositor.
The Depositor represents and warrants to the Trust and the Trustee on
behalf of the Certificateholders as follows:
(i) This agreement constitutes a legal, valid and binding obligation of
the Depositor, enforceable against the Depositor in accordance with its terms,
except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
affecting the enforcement of creditors' rights in general and except as such
enforceability may be limited by general principles of equity (whether
considered in a proceeding at law or in equity);
(ii) Immediately prior to the sale and assignment by the Depositor to
the Trustee on behalf of the Trust of each Mortgage Loan, the Depositor had good
and marketable title to each Mortgage Loan (insofar as such title was conveyed
to it by the Sponsor) subject to no prior lien, claim, participation interest,
mortgage, security interest, pledge, charge or other encumbrance or other
interest of any nature;
(iii) As of the Closing Date, the Depositor has transferred all right,
title interest in the Mortgage Loans to the Trustee on behalf of the Trust;
(iv) The Depositor has not transferred the Mortgage Loans to the
Trustee on behalf of the Trust with any intent to hinder, delay or defraud any
of its creditors;
(v) The Depositor has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the State of Delaware, with
full corporate power and authority to own its assets and conduct its business as
presently being conducted;
58
(vi) The Depositor is not in violation of its certificate of
incorporation or by-laws or in default in the performance or observance of any
material obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage, loan agreement, note, lease or other instrument to which
the Depositor is a party or by which it or its properties may be bound, which
default might result in any material adverse changes in the financial condition,
earnings, affairs or business of the Depositor or which might materially and
adversely affect the properties or assets, taken as a whole, of the Depositor;
(vii) The execution, delivery and performance of this Agreement by the
Depositor, and the consummation of the transactions contemplated thereby, do not
and will not result in a material breach or violation of any of the terms or
provisions of, or, to the knowledge of the Depositor, constitute a default
under, any indenture, mortgage, deed of trust, loan agreement or other agreement
or instrument to which the Depositor is a party or by which the Depositor is
bound or to which any of the property or assets of the Depositor is subject, nor
will such actions result in any violation of the provisions of the certificate
of incorporation or by-laws of the Depositor or, to the best of the Depositor's
knowledge without independent investigation, any statute or any order, rule or
regulation of any court or governmental agency or body having jurisdiction over
the Depositor or any of its properties or assets (except for such conflicts,
breaches, violations and defaults as would not have a material adverse effect on
the ability of the Depositor to perform its obligations under this Agreement);
(viii) To the best of the Depositor's knowledge without any independent
investigation, no consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body of the United
States or any other jurisdiction is required for the issuance of the
Certificates, or the consummation by the Depositor of the other transactions
contemplated by this Agreement, except such consents, approvals, authorizations,
registrations or qualifications as (a) may be required under State securities or
Blue Sky laws, (b) have been previously obtained or (c) the failure of which to
obtain would not have a material adverse effect on the performance by the
Depositor of its obligations under, or the validity or enforceability of, this
Agreement; and
(ix) There are no actions, proceedings or investigations pending before
or, to the Depositor's knowledge, threatened by any court, administrative agency
or other tribunal to which the Depositor is a party or of which any of its
properties is the subject: (a) which if determined adversely to the Depositor
would have a material adverse effect on the business, results of operations or
financial condition of the Depositor; (b) asserting the invalidity of this
Agreement or the Certificates; (c) seeking to prevent the issuance of the
Certificates or the consummation by the Depositor of any of the transactions
contemplated by this Agreement, as the case may be; (d) which might materially
and adversely affect the performance by the Depositor of its obligations under,
or the validity or enforceability of, this Agreement.
Section 2.07 Issuance of Certificates and the Uncertificated Regular
Interests.
The Trustee acknowledges the assignment to it of the Mortgage Loans and the
delivery to it (or the Custodian, as bailee and Custodian of the Trustee) of the
Mortgage Files, subject to the provisions of Sections 2.01 and 2.02, and the
Trustee acknowledges the assignment to it of all other assets included in the
Trust Fund, receipt of which is hereby acknowledged. Concurrently with such
assignment and delivery and in exchange therefor, the Trustee, pursuant to the
Written Order to Authenticate executed by an officer of the Depositor, has
executed, and the Certificate Registrar has authenticated and delivered to or
upon the order of the Depositor, the Certificates (other than the Class X and
Residual Certificates) in minimum dollar denominations or $25,000 and integral
dollar multiples of $1 in excess. The Class X and Class R Certificates are
issuable only in minimum Percentage Interests of 10%. The Class R-X Certificates
are issuable only in minimum Percentage Interests of 50%. The Trustee
acknowledges the issuance of the uncertificated REMIC 1 Regular Interests, the
uncertificated REMIC 2 Regular Interests, the uncertificated REMIC B-2 Regular
Interests, the uncertificated REMIC B-3 Regular Interests, the uncertificated
REMIC B-4 Regular Interests, the uncertificated REMIC B-5 Regular Interests and
the uncertificated REMIC X/N Regular Interests and declares that it holds the
REMIC 1 Regular Interests as assets of REMIC 2, the REMIC 2 B-2 Interest as the
asset of REMIC B-2, the REMIC 2 B-3 Interest as the asset of REMIC B-3, the
REMIC 2 B-4 Interest as the asset of REMIC B-4, the REMIC 2 B-5 Interest as the
asset of REMIC B-5 and the REMIC 2 X/N Interest as the asset of REMIC X/N. The
Trustee acknowledges the issuance of the uncertificated REMIC X/N X/N Interest,
beneficial ownership of which is evidenced by the Class X/N Interest, and
declares that it holds the same as assets of the Grantor Trust on behalf of the
Holders of the Class N and Class X Certificates. The interests evidenced by the
Certificates constitute the entire beneficial ownership interest in the Trust
Fund.
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Section 2.08 Representations and Warranties of the Sponsor.
The Sponsor hereby represents and warrants to the Trust and the Trustee
on behalf of the Certificateholders that as of the Closing Date or as of such
date specifically provided herein:
(i) The Sponsor is duly organized, validly existing and in good
standing as a limited liability company under the laws of the State of Delaware
and has the power and authority to own its assets and to transact the business
in which it is currently engaged. The Sponsor is duly qualified to do business
and is in good standing in each jurisdiction in which the character of the
business transacted by it or properties owned or leased by it requires such
qualification and in which the failure to so qualify would have a material
adverse effect on (a) its business, properties, assets or condition (financial
or other), (b) the performance of its obligations under this Agreement, (c) the
value or marketability of the Mortgage Loans, or (d) its ability to foreclose on
the related Mortgaged Properties.
(ii) The Sponsor has the power and authority to make, execute, deliver
and perform this Agreement and to consummate all of the transactions
contemplated hereunder and has taken all necessary action to authorize the
execution, delivery and performance of this Agreement. When executed and
delivered, this Agreement will constitute the Sponsor's legal, valid and binding
obligations enforceable in accordance with its terms, except as enforcement of
such terms may be limited by (1) bankruptcy, insolvency, reorganization,
receivership, moratorium or similar laws affecting the enforcement of creditors'
rights generally and by the availability of equitable remedies, (2) general
equity principles (regardless of whether such enforcement is considered in a
proceeding in equity or at law) or (3) public policy considerations underlying
the securities laws, to the extent that such policy considerations limit the
enforceability of the provisions of this Agreement which purport to provide
indemnification from securities laws liabilities.
(iii) The Sponsor holds all necessary licenses, certificates and
permits from all governmental authorities necessary for conducting its business
as it is presently conducted, except for such licenses, certificates and permits
the absence of which, individually or in the aggregate, would not have a
material adverse effect on the ability of the Sponsor to conduct its business as
it is presently conducted. It is not required to obtain the consent of any other
party or any consent, license, approval or authorization from, or registration
or declaration with, any governmental authority, bureau or agency in connection
with the execution, delivery, performance, validity or enforceability of this
Agreement, except for such consents, licenses, approvals or authorizations, or
registrations or declarations as shall have been obtained or filed, as the case
may be, prior to the Closing Date.
(iv) The execution, delivery and performance of this Agreement by the
Sponsor will not conflict with or result in a breach of, or constitute a default
under, any provision of any existing law or regulation or any order or decree of
any court applicable to the Sponsor or any of its properties or any provision of
its Limited Liability Company Agreement, or constitute a material breach of, or
result in the creation or imposition of any lien, charge or encumbrance upon any
of its properties pursuant to any mortgage, indenture, contract or other
agreement to which it is a party or by which it may be bound.
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(v) No certificate of an officer, written statement or report delivered
pursuant to the terms hereof by the Sponsor contains any untrue statement of a
material fact or omits to state any material fact necessary to make the
certificate, statement or report not misleading.
(vi) The transactions contemplated by this Agreement are in the
ordinary course of the Sponsor's business.
(vii) The Sponsor is not insolvent, nor will the Sponsor be made
insolvent by the transfer of the Mortgage Loans to the Depositor, nor is the
Sponsor aware of any pending insolvency.
(viii) The Sponsor is not in violation of, and the execution and
delivery of this Agreement by it and its performance and compliance with the
terms of this Agreement will not constitute a violation with respect to any
order or decree of any court, or any order or regulation of any federal, state,
municipal or governmental agency having jurisdiction, which violation would
materially and adversely affect the Sponsor's condition (financial or otherwise)
or operations or any of the Sponsor's properties, or materially and adversely
affect the performance of any of its duties hereunder.
(ix) There are no actions or proceedings against, or investigations of,
the Sponsor pending or, to its knowledge, threatened, before any court,
administrative agency or other tribunal (i) that, if determined adversely, would
prohibit the Sponsor from entering into this Agreement, (ii) seeking to prevent
the consummation of any of the transactions contemplated by this Agreement or
(iii) that, if determined adversely, would prohibit or materially and adversely
affect the Sponsor's performance of any of its respective obligations under, or
the validity or enforceability of, this Agreement.
(x) The Sponsor did not transfer the Mortgage Loans to the Depositor
with any intent to hinder, delay or defraud any of its creditors.
(xi) The Sponsor acquired title to the Mortgage Loans in good faith,
without notice of any adverse claims.
(xii) The transfer, assignment and conveyance of the Mortgage Notes and
the Mortgages by the Sponsor to the Depositor are not subject to the bulk
transfer laws or any similar statutory provisions in effect in any applicable
jurisdiction.
Section 2.09 Covenants of the Sponsor.
(a) The Sponsor hereby covenants that except for the transfer
hereunder, the Sponsor will not sell, pledge, assign or transfer to any other
Person, or grant, create, incur, assume or suffer to exist any lien on any
Mortgage Loan, or any interest therein; the Sponsor will notify the Trustee, as
assignee of the Depositor, of the existence of any lien on any Mortgage Loan
immediately upon discovery thereof, and the Sponsor will defend the right, title
and interest of the Trust, as assignee of the Depositor, in, to and under the
Mortgage Loans, against all claims of third parties claiming through or under
the Sponsor; provided, however, that nothing in this Section 2.09 shall prevent
or be deemed to prohibit the Sponsor from suffering to exist upon any of the
Mortgage Loans any liens for municipal or other local taxes and other
governmental charges if such taxes or governmental charges shall not at the time
be due and payable or if the Sponsor shall currently be contesting the validity
thereof in good faith by appropriate proceedings and shall have set aside on its
books adequate reserves with respect thereto.
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(b) The Sponsor hereby covenants that neither it nor any Affiliate of
the Sponsor will directly solicit any Mortgagor hereunder to refinance the
related Mortgage Loan. For the purposes of the foregoing, neither the Sponsor
nor any Affiliate of the Sponsor shall be deemed to directly solicit any
Mortgagor if the Sponsor received a request for verification of mortgage, a
request for demand for payoff, a mortgagor initiated written or verbal
communication indicating a desire to prepay or refinance the related Mortgage
Loan or the Mortgagor initiates a title search, or if the Sponsor responds to a
request from a Mortgagor regarding a refinancing or if the Mortgagor receives
marketing materials which are generally disseminated.
ARTICLE III
ADMINISTRATION AND SERVICING
OF THE TRUST FUND
Section 3.01 Servicer to Act as Servicer.
The Servicer, as independent contract servicer, shall service and
administer the Mortgage Loans in accordance with this Agreement and the normal
and usual standards of practice of prudent mortgage servicers, and shall have
full power and authority, acting alone, to do or cause to be done any and all
things in connection with such servicing and administration which the Servicer
may deem necessary or desirable and consistent with the terms of this Agreement
and consistent with the standard of care which the Servicer uses and/or would
use in servicing mortgage loans for its own account (the "Servicing Standards").
Consistent with the terms of this Agreement, the Servicer may waive,
modify or vary any term of any Mortgage Loan or consent to the postponement of
strict compliance with any such term or in any manner grant indulgence to any
Mortgagor if in the Servicer's reasonable and prudent determination such waiver,
modification, postponement or indulgence is not materially adverse to the
Certificateholders; provided, however, that the Servicer shall not make future
advances and (unless the Mortgagor is in default with respect to the Mortgage
Loan or such default is, in the judgment of the Servicer, reasonably
foreseeable) the Servicer shall not permit any modification with respect to any
Mortgage Loan that would (i) change the Mortgage Interest Rate, defer or forgive
the payment thereof of any principal or interest payments, reduce the
outstanding principal amount (except for actual payments of principal) or extend
the final maturity date with respect to such Mortgage Loan, (ii) [reserved]
(iii) affect adversely the status of any REMIC constituting part of the Trust
Fund as a REMIC or (iv) cause any REMIC to be subject to a tax on "prohibited
transactions" or "contributions" pursuant to the REMIC Provisions.
Notwithstanding the foregoing, the Servicer shall not permit any modification
with respect to any Mortgage Loan that would both (x) effect an exchange or
reissuance of such Mortgage Loan under Section 1.860G-2(b) of the Treasury
Regulations and (y) cause any REMIC constituting part of the Trust Fund to fail
to qualify as a REMIC under the Code or the imposition of any tax on "prohibited
transactions" or "contributions" after the Startup Day under the REMIC
Provisions. Without limiting the generality of the foregoing, the Servicer shall
continue, and is hereby authorized and empowered to execute and deliver on
behalf of itself, and the Trustee, all instruments of satisfaction or
cancellation, or of partial or full release, discharge and all other comparable
instruments, with respect to the Mortgage Loans and with respect to the
Mortgaged Property. The Servicer shall make all required Servicing Advances and
shall service and administer the Mortgage Loans in accordance with Applicable
Regulations, and shall provide to the Mortgagors any reports required to be
provided to them thereby. If reasonably required by the Servicer, the Trustee
shall furnish the Servicer a power of attorney (substantially in the form
annexed hereto as Exhibit O) and other documents necessary or appropriate to
enable the Servicer to carry out its servicing and administrative duties under
this Agreement.
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In servicing and administering the Mortgage Loans, the Servicer shall
employ procedures including collection procedures and exercise the same care
that it customarily employs and exercises in servicing and administering
mortgage loans for its own account giving due consideration to accepted mortgage
servicing practices of prudent lending institutions and the Certificateholders'
reliance on the Servicer.
The Servicer shall give prompt notice to the Trustee of any action, of
which the Servicer has actual knowledge, which action purports to (i) assert a
claim against the Trust Fund or (ii) assert jurisdiction over the Trust Fund.
Notwithstanding anything in this Agreement to the contrary, in the
event of a Principal Prepayment in full, the Servicer may not waive any
prepayment penalty or portion thereof required by the terms of the related
Mortgage Note unless (i) the related Mortgage Loan is in default or foreseeable
default and such waiver (a) is standard and customary in servicing mortgage
loans similar to the Mortgage Loans and (b) would, in the reasonable judgment of
the Servicer, maximize recovery of total proceeds taking into account the value
of such prepayment penalty and the related Mortgage Loan, (ii) (A) the
enforceability thereof is limited (1) by bankruptcy, insolvency, moratorium,
receivership, or other similar law relating to creditors' rights generally or
(2) due to acceleration in connection with a foreclosure or other involuntary
payment, or (B) the enforceability is otherwise limited or prohibited by
applicable law or (iii) if the Servicer has not been provided with information
sufficient to enable it to collect the prepayment penalty. In the event of a
Principal Prepayment in full with respect to any Mortgage Loan, the Servicer
shall deliver to the Trustee an Officer's Certificate, substantially in the form
of Exhibit Q, no later than the third Business Day following the immediately
succeeding Determination Date. For the avoidance of doubt, the Servicer may
waive a prepayment penalty in connection with a short sale or short payoff on a
defaulted Mortgage Loan. If the Servicer has waived all or a portion of a
prepayment penalty relating to a Principal Prepayment, other than as provided
above, the Servicer shall deliver to the Trustee as soon as possible after the
date of payoff, but in no event later than five business days from such date,
for deposit into the Distribution Account the amount of such prepayment penalty
(or such portion thereof as had been waived) for distribution in accordance with
the terms of this Agreement.
Based solely on information provided to it by the Servicer, the Trustee
shall prepare and deliver to the Depositor and the owners of the Class N and
Class X Certificates, on a monthly basis, a statement setting forth the amounts
received with respect to prepayment penalties.
During the period when reports are required to be filed for the Trust
under the Exchange Act, the Servicer shall not permit a Subservicer to perform
any servicing responsibilities hereunder with respect to the Mortgage Loans
unless that Subservicer first agrees in writing with the Servicer to deliver an
Assessment of Compliance and an Accountant's Attestation in such manner and at
such times that permits the Servicer to comply with Section 3.20 of this
Agreement.
Section 3.02 Collection of Mortgage Loan Payments.
Continuously from the date hereof until the principal and interest on
all Mortgage Loans are paid in full, the Servicer will diligently collect all
payments due under each Mortgage Loan when the same shall become due and payable
and shall, to the extent such procedures shall be consistent with this Agreement
and the terms and provisions of any related Primary Insurance Policy and
Applicable Regulations, follow such collection procedures as it follows with
respect to mortgage loans comparable to the Mortgage Loans and held for its own
account. Further, the Servicer will take special care in ascertaining and
estimating annual ground rents, taxes, assessments, water rates, fire and hazard
insurance premiums, mortgage insurance premiums, and all other charges that, as
provided in the Mortgage, will become due and payable to that end that the
installments payable by the Mortgagors will be sufficient to pay such charges as
and when they become due and payable.
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Section 3.03 Realization Upon Defaulted Mortgage Loans.
In the event that any payment due under any Mortgage Loan is not paid
when the same becomes due and payable, or in the event the Mortgagor fails to
perform any other covenant or obligation under the Mortgage Loan and such
failure continues beyond any applicable grace period, the Servicer shall take
such action as it shall deem to be in the best interest of the
Certificateholders. With respect to any defaulted Mortgage Loan, the Servicer
shall have the right to review the status of the related forbearance plan and,
subject to the second paragraph of Section 3.01, may modify such forbearance
plan; including, extending the Mortgage Loan repayment date for a period of one
year, which period will not go beyond the latest Final Maturity Date.
In connection with a foreclosure or other conversion, the Servicer
shall exercise such rights and powers vested in it hereunder and use the same
degree of care and skill in its exercise as prudent mortgage servicers would
exercise or use under the circumstances in the conduct of their own affairs and
consistent with Applicable Regulations and the servicing standards set forth in
the Xxxxxx Xxx Guide, including, without limitation, advancing funds for the
payment of taxes and insurance premiums with respect to first lien Mortgage
Loans.
Notwithstanding the foregoing provisions of this Section 3.03, with
respect to any Mortgage Loan as to which the Servicer has received actual notice
of, or has actual knowledge of, the presence of any toxic or hazardous substance
on the related Mortgaged Property, the Servicer shall not either (i) obtain
title to such Mortgaged Property as a result of or in lieu of foreclosure or
otherwise, or (ii) otherwise acquire possession of, or take any other action
with respect to, such Mortgaged Property if, as a result of any such action, the
Trust Fund would be considered to hold title to, to be a mortgagee-in-possession
of, or to be an owner or operator of such Mortgaged Property within the meaning
of the Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended from time to time, or any comparable law, unless the Servicer
has also previously determined, based on its reasonable judgment and a prudent
report prepared by a Person who regularly conducts environmental audits using
customary industry standards, that:
A. such Mortgaged Property is in compliance with applicable
environmental laws or, if not, that it would be in the best economic interest of
the Certificateholders to take such actions as are necessary to bring the
Mortgaged Property into compliance therewith; and
B. there are no circumstances present at such Mortgaged Property
relating to the use, management or disposal of any hazardous substances,
hazardous materials, hazardous wastes, or petroleum-based materials for which
investigation, testing, monitoring, containment, clean-up or remediation could
be required under any federal, state or local law or regulation, or that if any
such materials are present for which such action could be required, that it
would be in the best economic interest of the Certificateholders to take such
actions with respect to the affected Mortgaged Property.
The cost of the environmental audit report contemplated by this Section
3.03 shall be advanced by the Servicer, subject to the Servicer's right to be
reimbursed therefor from the Collection Account as provided in Section 3.05(ii).
If the Servicer determines, as described above, that it is in the best
economic interest of the Certificateholders to take such actions as are
necessary to bring any such Mortgaged Property into compliance with applicable
environmental laws, or to take such action with respect to the containment,
clean-up or remediation of hazardous substances, hazardous materials, hazardous
wastes, or petroleum-based materials affecting any such Mortgaged Property, then
the Servicer shall take such action as it deems to be in the best economic
interest of the Certificateholders. The cost of any such compliance,
containment, cleanup or remediation shall be advanced by the Servicer, subject
to the Servicer's right to be reimbursed therefor from the Collection Account as
provided in Section 3.05(ii).
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Section 3.04 Collection Account and Distribution Account.
(a) The Servicer shall segregate and hold all funds collected and
received pursuant to each Mortgage Loan separate and apart from any of its own
funds and general assets and shall establish and maintain one or more Collection
Accounts. Each Collection Account shall be an Eligible Account.
The Servicer shall deposit in the Collection Account on a daily basis
within two Business Days of receipt, and retain therein, the following payments
and collections received or made by it after the Cut-off Date with respect to
the Mortgage Loans:
(i) all payments on account of principal, including Principal
Prepayments, on the Mortgage Loans;
(ii) all payments on account of interest on the Mortgage Loans adjusted
to the Mortgage Interest Rate less the Servicing Fee Rate;
(iii) all proceeds from a Cash Liquidation;
(iv) all Insurance Proceeds including amounts required to be deposited
pursuant to Section 3.10, other than proceeds to be held in the Escrow Account
and applied to the restoration or repair of the Mortgaged Property or released
to the Mortgagor in accordance with the Servicer's normal servicing procedures,
the loan documents or applicable law;
(v) all Condemnation Proceeds affecting any Mortgaged Property which
are not released to the Mortgagor in accordance with the Servicer's normal
servicing procedures, the loan documents or applicable law; and
(vi) any amounts required to be deposited by the Servicer in connection
with any REO Property pursuant to Section 3.13.
Any interest paid on funds deposited in the Collection Account, subject
to Section 3.25, shall accrue to the benefit of the Servicer and the Servicer
shall be entitled to retain and withdraw such interest from the Collection
Account pursuant to Section 3.05(v). The foregoing requirements for deposit from
the Collection Account shall be exclusive, it being understood and agreed that,
without limiting the generality of the foregoing, payments in the nature of late
payment charges, prepayment charges that are not prepayment penalties, and
assumption fees need not be deposited by the Servicer in the Collection Account.
(b) On behalf of the Trust Fund, the Trustee shall establish and
maintain one or more accounts (such account or accounts, the "Distribution
Account"), held in trust for the benefit of the Certificateholders. On behalf of
the Trust Fund, the Servicer shall deliver to the Trustee in immediately
available funds for deposit in the Distribution Account by the close of business
New York time on the Servicer Remittance Date, that portion of the Available
Funds (calculated without regard to the references in the definition thereof to
amounts that may be deposited to the Distribution Account from a different
source as provided herein) then on deposit in the Collection Account. Amounts in
the Distribution Account shall be deemed to be held on behalf of the related
REMICs and the Grantor Trust in accordance with the REMIC distributions set
forth in Section 4.08. Funds on deposit in the Distribution Account will remain
uninvested.
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(c) Funds in the Collection Account may be invested in Permitted
Investments in accordance with the provisions set forth in Section 3.25. The
Servicer shall give notice to the Trustee certifying the location of the
Collection Account maintained by it when established and prior to any change
thereof. The Trustee shall give notice to the Servicer and the Depositor of the
location of the Distribution Account when established and prior to any change
thereof.
(d) In the event the Servicer shall deliver to the Trustee for deposit
in the Distribution Account any amount not required to be deposited therein, it
may at any time in writing request that the Trustee withdraw such amount from
the Distribution Account and remit to the Servicer any such amount, any
provision herein to the contrary notwithstanding. In addition, the Servicer
shall deliver to the Trustee from time to time for deposit, and the Trustee
shall so deposit, in the Distribution Account in respect of REMIC 1:
(i) any Advances, as required pursuant to Section 4.07;
(ii) any Stayed Funds, as soon as permitted by the federal bankruptcy
court having jurisdiction in such matters;
(iii) any prepayment penalties or amounts in connection with the waiver
of such prepayment penalties, in each case required to be deposited pursuant to
Section 3.01;
(iv) any amounts required to be deposited in the Distribution Account
pursuant to Sections 2.03, 3.04, 3.15, 3.16, 3.23 or 4.07; and
(v) any amounts required to be deposited by the Servicer pursuant to
Section 3.11 in connection with the deductible clause in any blanket hazard
insurance policy, such deposit being made from the Servicer's own funds, without
reimbursement therefor.
(e) Promptly upon receipt of any Stayed Funds, whether from the
Servicer, a trustee in bankruptcy, or federal bankruptcy court or other source,
the Trustee shall notify the Servicer of such receipt and deposit such funds in
the Distribution Account, subject to withdrawal thereof as permitted hereunder.
Section 3.05 Permitted Withdrawals From the Collection Account.
The Servicer may, from time to time, withdraw from the Collection
Account for the following purposes:
(i) to remit to the Trustee for deposit in the Distribution Account (a)
the amounts required to be so remitted pursuant to Section 3.04(b), (b) the
amounts permitted to be so remitted pursuant to the first sentence of Section
3.04(d) or clause (ii) of the first sentence of the second paragraph of Section
4.07(b), (c) any amounts required to be so remitted pursuant to Section 6.03 and
(d) any amounts required to be so remitted pursuant to Section 8.05;
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(ii) to reimburse itself for (a) Advances and Servicing Advances to the
extent of amounts received on the related Mortgage Loan which represent payments
of (x) principal and/or interest respecting which any such Advance was made or
(y) Condemnation Proceeds, Insurance Proceeds or Liquidation Proceeds respecting
which any such Servicing Advance was made; or (b) any unreimbursed Advances to
the extent of funds held in the Collection Account for future distributions that
were not included in Available Funds for the preceding Distribution Date
(provided, however, any funds so applied will be replaced by the Servicer by
deposit in the Collection Account no later than one Business Day prior to the
Distribution Date on which such funds are required to be distributed) and to
reimburse itself for Advances and Servicing Advances made in connection with the
modification of a Mortgage Loan;
(iii) to reimburse itself for unreimbursed Servicing Advances, any
unpaid Servicing Fees and for unreimbursed Advances to the extent that such
amounts are deemed to be Nonrecoverable Advances and to reimburse itself for
such amounts to the extent that such amounts are nonrecoverable from the
disposition of the related REO Property or have been written-off pursuant to
Section 3.13 hereof;
(iv) to reimburse itself for any amounts paid pursuant to Section 3.03
(and not otherwise previously reimbursed);
(v) to pay to itself as servicing compensation (a) any interest earned
on funds in the Collection Account (all such interest to be withdrawn monthly
not later than each Servicer Remittance Date) and (b) the Servicing Fee from
that portion of any payment or recovery as to interest to a particular Mortgage
Loan to the extent not retained pursuant to Section 3.04(d);
(vi) to pay or reimburse itself for any amounts payable or paid
pursuant to Section 6.03 (and not otherwise previously reimbursed) and to
reimburse itself as set forth in Section 9.01(c); and
(vii) to clear and terminate the Collection Account upon the
termination of this Agreement.
The foregoing requirements for withdrawal from the Collection Account
shall be exclusive. In the event the Servicer shall deposit in the Collection
Account any amount not required to be deposited therein, it may at any time
withdraw such amount from the Collection Account, any provision herein to the
contrary notwithstanding.
Section 3.06 Establishment of Escrow Account; Deposits in Escrow
Account.
The Servicer shall segregate and hold all funds collected and received
pursuant to each Mortgage Loan which constitute Escrow Payments separate and
apart from any of its own funds and general assets and shall establish and
maintain one or more Escrow Accounts, in the form of time deposit or demand
accounts. A copy of such letter agreement shall be furnished to the Trustee upon
request. The Escrow Account shall be an Eligible Account.
The Servicer shall deposit in the Escrow Account on a daily basis
within two Business Days of receipt, and retain therein, (i) all Escrow Payments
collected on account of the Mortgage Loans, for the purpose of effecting timely
payment of any such items as required under the terms of this Agreement, and
(ii) all Insurance Proceeds which are to be applied to the restoration or repair
of any Mortgaged Property. The Servicer shall make withdrawals therefrom only to
effect such payments as are required under this Agreement, and for such other
purposes as shall be set forth in, or in accordance with, Section 3.07. The
Servicer shall be entitled to retain any interest paid on funds deposited in the
Escrow Account by the depository institution other than interest on escrowed
funds required by law to be paid to the Mortgagor and, to the extent required by
the related Mortgage Loan or Applicable Regulations, the Servicer shall pay
interest on escrowed funds to the Mortgagor notwithstanding that the Escrow
Account is non-interest bearing or that interest paid thereon is insufficient
for such purposes.
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Section 3.07 Permitted Withdrawals From Escrow Account.
Withdrawals from the Escrow Account may be made by the Servicer (i) to
effect timely payments of ground rents, taxes, assessments, water rates, fire,
flood and hazard insurance premiums, Primary Insurance Policy premiums, if
applicable, and comparable items, (ii) to reimburse the Servicer for any
Servicing Advance made by the Servicer with respect to a related Mortgage Loan
but only from amounts received on the related Mortgage Loan which represent late
payments or Late Collections of Escrow Payments thereunder, (iii) to refund to
the Mortgagor any funds as may be determined to be overages, (iv) for transfer
to the Collection Account in accordance with the terms of this Agreement, (v)
for application to restoration or repair of the Mortgaged Property, (vi) to pay
to the Servicer, or to the Mortgagor to the extent required by the related
Mortgage Loan or Applicable Regulations, any interest paid on the funds
deposited in the Escrow Account, (vii) to clear and terminate the Escrow Account
on the termination of this Agreement, or (viii) to transfer to the Collection
Account any insurance proceeds. As part of its servicing duties, the Servicer
shall pay to the Mortgagor interest on funds in the Escrow Account, to the
extent required by the related Mortgage Loan or Applicable Regulations, and to
the extent that interest earned on funds in the Escrow Account is insufficient,
shall pay such interest from its own funds, without any reimbursement therefor.
In the event the Servicer shall deposit in the Escrow Account any
amount not required to be deposited therein, it may at any time withdraw such
amount from the Escrow Account, any provision herein to the contrary
notwithstanding.
Section 3.08 Payment of Taxes, Insurance and Other Charges; Collections
Thereunder.
With respect to each first lien Mortgage Loan, the Servicer shall
maintain accurate records reflecting the status of ground rents, taxes,
assessments, water rates and other charges which are or may become a lien upon
the Mortgaged Property and the status of Primary Insurance Policy premiums and
fire, flood and hazard insurance coverage and shall obtain, from time to time,
all bills for the payment of such charges (including renewal premiums) and shall
effect payment thereof prior to the applicable penalty or termination date and
at a time appropriate for securing maximum discounts allowable, employing for
such purpose deposits of the Mortgagor in the Escrow Account which shall have
been estimated and accumulated by the Servicer in amounts sufficient for such
purposes, as allowed under the terms of the Mortgage or Applicable Regulations.
To the extent that a Mortgage does not provide for Escrow Payments, the Servicer
shall (i) determine whether any such payments are made by the Mortgagor in a
manner and at a time that is necessary to avoid the loss of the Mortgaged
Property due to a tax sale or the foreclosure as a result of a tax lien and (ii)
ensure that all insurance required to be maintained on the Mortgaged Property
pursuant to this Agreement is maintained. If any such payment has not been made
and the Servicer receives notice of a tax lien with respect to the Mortgage Loan
being imposed, the Servicer will, to the extent required to avoid loss of the
Mortgaged Property, advance or cause to be advanced funds necessary to discharge
such lien on the Mortgaged Property. The Servicer assumes full responsibility
for the payment of all such bills and shall effect payments of all such bills
irrespective of the Mortgagor's faithful performance in the payment of same or
the making of the Escrow Payments and shall make Servicing Advances from its own
funds to effect such payments.
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The Servicer, on behalf of the Trustee, as mortgagee, will maintain in
full force and effect (to the extent a Mortgage Loan has a Primary Insurance
Policy) a Primary Insurance Policy issued by a Qualified Insurer with respect to
each Mortgage Loan for which such coverage is required. Such coverage will be
maintained until the Combined Loan-to-Value Ratio of the related Mortgage Loan
is reduced to 80% or less. The Servicer will not cancel or refuse to renew any
Primary Insurance Policy in effect on the Closing Date that is required to be
kept in force under this Agreement unless a replacement Primary Insurance Policy
for such cancelled or non-renewed policy is obtained from and maintained with a
Qualified Insurer. The Servicer shall not take any action which would result in
non-coverage under any applicable Primary Insurance Policy of any loss which,
but for the actions of the Servicer, would have been covered thereunder. In
connection with any assumption or substitution agreement entered into or to be
entered into pursuant to Section 3.14, the Servicer shall promptly notify the
insurer under the related Primary Insurance Policy, if any, of such assumption
or substitution of liability in accordance with the terms of such policy and
shall take all actions which may be required by such insurer as a condition to
the continuation of coverage under the Primary Insurance Policy. If such Primary
Insurance Policy is terminated as a result of such assumption or substitution of
liability, the Servicer shall obtain a replacement Primary Insurance Policy as
provided above.
In connection with its activities as servicer, the Servicer agrees to
prepare and present, on behalf of itself and the Trustee, claims to the insurer
under any Primary Insurance Policy in a timely fashion in accordance with the
terms of such policies and, in this regard, to take such action as shall be
necessary to permit recovery under any Primary Insurance Policy respecting a
defaulted Mortgage Loan. Pursuant to Section 3.04, any amounts collected by the
Servicer under any Primary Insurance Policy shall be deposited in the Collection
Account, subject to withdrawal pursuant to Section 3.05.
Section 3.09 Transfer of Accounts.
The Servicer may transfer the Collection Account or the Escrow Account
to a different depository institution from time to time. Upon such transfer, the
Servicer shall deliver to the Trustee and the Depositor, a certification or
letter agreement, as the case may be, as required pursuant to Sections 3.04 and
3.06.
Section 3.10 Maintenance of Hazard Insurance.
The Servicer shall cause to be maintained for each first lien Mortgage
Loan fire and hazard insurance with extended coverage as is customary in the
area where the Mortgaged Property is located in an amount which is at least
equal to the lesser of (i) the amount necessary to fully compensate for any
damage or loss to the improvements which are a part of such property on a
replacement cost basis and (ii) the Principal Balance of the Mortgage Loan, in
each case in an amount not less than such amount as is necessary to prevent the
Mortgagor and/or the Mortgagee from becoming a co-insurer. If the Mortgaged
Property is in an area identified in the Federal Register by the Flood Emergency
Management Agency as having special flood hazards and flood insurance has been
made available, the Servicer will cause to be maintained a flood insurance
policy meeting the requirements of the current guidelines of the Federal
Insurance Administration with a generally acceptable insurance carrier, in an
amount representing coverage not less than the least of (i) the Principal
Balance of the Mortgage Loan, (ii) the maximum insurable value of the
improvements securing such Mortgage Loan or (iii) the maximum amount of
insurance which is available under the Flood Disaster Protection Act of 1973, as
amended. The Servicer shall also maintain on the REO Property for the benefit of
the Certificateholders, (x) fire and hazard insurance with extended coverage in
an amount which is at least equal to the replacement cost of the improvements
which are a part of such property, (y) public liability insurance and, (z) to
the extent required and available under the Flood Disaster Protection Act of
1973, as amended, flood insurance in an amount as provided above. Any amounts
collected by the Servicer under any such policies other than amounts to be
deposited in the Escrow Account and applied to the restoration or repair of the
Mortgaged Property or REO Property, or released to the Mortgagor in accordance
with the Servicer's normal servicing procedures, shall be deposited in the
Collection Account, subject to withdrawal pursuant to Section 3.05. It is
understood and agreed that no earthquake or other additional insurance is
required to be maintained by the Servicer or the Mortgagor or maintained on
property acquired in respect of the Mortgage Loan, other than pursuant to such
Applicable Regulations as shall at any time be in force and as shall require
such additional insurance. All such policies shall be endorsed with standard
mortgagee clauses with loss payable to the Servicer and shall provide for at
least thirty days prior written notice of any cancellation, reduction in the
amount of or material change in coverage to the Servicer. The Servicer shall not
interfere with the Mortgagor's freedom of choice in selecting either his
insurance carrier or agent, provided, however, that the Servicer shall not
accept any such insurance policies from insurance companies unless such
companies currently reflect a general policy rating of B:VI or better in Best's
Key Rating Guide and are licensed to do business in the state wherein the
property subject to the policy is located.
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Section 3.11 Maintenance of Mortgage Impairment Insurance Policy.
In the event that the Servicer shall obtain and maintain a blanket
policy issued by an insurer that has a general policy rating of B:VI or better
in Best's Key Rating Guide insuring against hazard losses on all of the Mortgage
Loans, then, to the extent such policy provides coverage in an amount equal to
the amount required pursuant to Section 3.10 and otherwise complies with all
other requirements of Section 3.10, it shall conclusively be deemed to have
satisfied its obligations as set forth in Section 3.10, it being understood and
agreed that such policy may contain a deductible clause, in which case the
Servicer shall, in the event that there shall not have been maintained on the
related Mortgaged Property or REO Property a policy complying with Section 3.10,
and there shall have been a loss which would have been covered by such policy,
deliver to the Trustee for deposit in the Distribution Account the amount not
otherwise payable under the blanket policy because of such deductible clause,
which amount shall not be reimbursable to the Servicer from the Trust Fund. In
connection with its activities as servicer of the Mortgage Loans, the Servicer
agrees to prepare and present, on behalf of the Trustee, claims under any such
blanket policy in a timely fashion in accordance with the terms of such policy.
Upon request of the Trustee, the Servicer shall cause to be delivered to the
Trustee a certified true copy of such policy and a statement from the insurer
thereunder that such policy shall in no event be terminated or materially
modified without thirty days prior written notice to the Trustee.
Section 3.12 Fidelity Bond, Errors and Omissions Insurance.
The Servicer shall maintain, at its own expense, a blanket fidelity
bond (the "Fidelity Bond") and an errors and omissions insurance policy, with
broad coverage with financially responsible companies on all officers, employees
or other persons acting in any capacity with regard to the Mortgage Loans to
handle funds, money, documents and papers relating to the Mortgage Loans. The
Fidelity Bond and errors and omissions insurance shall be in the form of the
Mortgage Banker's Blanket Bond and shall protect and insure the Servicer against
losses, including forgery, theft, embezzlement, fraud, errors and omissions and
negligent acts of such persons. Such Fidelity Bond shall also protect and insure
the Servicer against losses in connection with the failure to maintain any
insurance policies required pursuant to this Agreement and the release or
satisfaction of a Mortgage Loan without having obtained payment in full of the
indebtedness secured thereby. No provision of this Section 3.12 requiring the
Fidelity Bond and errors and omissions insurance shall diminish or relieve the
Servicer from its duties and obligations as set forth in this Agreement. The
minimum coverage under any such bond and insurance policy shall be at least
equal to the corresponding amounts required by Xxxxxx Mae in the Xxxxxx Xxx MBS
Selling and Servicing Guide or by Xxxxxxx Mac in the Xxxxxxx Mac Servicer's
Guide. Upon the request of any party hereto, each year the Servicer shall cause
to be delivered to such party proof of coverage of the Fidelity Bond and errors
and omissions insurance policy and a statement from the surety and the insurer
that the surety and the insurer shall endeavor to notify the Trustee within 30
days prior to such Fidelity Bond's errors and omissions insurance policy's
termination or material modification.
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Section 3.13 Title, Management and Disposition of REO Property and
Certain Delinquent Mortgage Loans.
(a) In the event that title to a Mortgaged Property is acquired in
foreclosure or by deed in lieu of foreclosure, the deed or certificate of sale
shall be taken (pursuant to a limited power of attorney to be provided by the
Trustee to the Servicer) in the name of the Trustee or a nominee thereof, on
behalf of the Certificateholders, or in the event the Trustee or a nominee
thereof is not authorized or permitted to hold title to real property in the
state where the REO Property is located, or would be adversely affected under
the "doing business" or tax laws of such state by so holding title, the deed or
certificate of sale shall be taken in the name of such Person or Persons as
shall be consistent with an Opinion of Counsel obtained by the Servicer from an
attorney duly licensed to practice law in the state where the REO Property is
located. Any Person or Persons holding such title other than the Trustee shall
acknowledge in writing that such title is being held as nominee for the benefit
of the Trustee.
(b) In the event that the Trust Fund acquires any REO Property as
aforesaid or otherwise in connection with a default or imminent default on a
Mortgage Loan, the Servicer shall dispose of such REO Property before the end of
the third calendar year beginning after the year of its acquisition by the Trust
Fund for purposes of Section 860G(a)(8) of the Code or if the Trust Fund has
received (at the expense of the Trust Fund) from the Internal Revenue Service an
extension of the period during which it may hold such REO Property without such
REO Property failing to be treated as "foreclosure property" (within the meaning
of Section 860G(a)(8) of the Code), before the end of such extension, unless the
Servicer obtains an Opinion of Counsel, addressed to the Servicer and the
Trustee, to the effect that the holding by the Trust Fund of such REO Property
subsequent to such period will not: (i) result in the imposition of any tax on
"prohibited transactions" as defined in Section 860F of the Code; or (ii) cause
any REMIC constituting part of the Trust Fund to fail to qualify as a REMIC at
any time that any Certificates are outstanding, in which case the Trust Fund may
continue to hold such REO Property (subject to any conditions contained in such
Opinion of Counsel). The Servicer shall be entitled to be reimbursed from the
Collection Account for any costs incurred in obtaining such Opinion of Counsel,
as provided in Section 3.05.
Subject to compliance with applicable laws and regulations as shall at
any time be in force, and notwithstanding any other provisions of this
Agreement, no REO Property acquired by the Trust Fund shall be rented (or
allowed to continue to be rented) or otherwise used by or on behalf of the Trust
Fund in such a manner or pursuant to any terms that would: (i) cause such REO
Property to fail to qualify as "foreclosure property" within the meaning of
Section 860G(a)(8) of the Code; or (ii) subject any REMIC constituting part of
the Trust Fund to the imposition of any federal income taxes on the income
earned from such REO Property, including any taxes imposed by reason of Sections
860F or 860G(c) of the Code, unless the Servicer has agreed to indemnify and
hold harmless the Trust Fund with respect to the imposition of any such taxes.
The Servicer shall manage, conserve, protect and operate each REO
Property for the Certificateholders and the Trust Fund solely for the purpose of
its prompt disposition and sale in a manner which does not cause such REO
Property to fail to qualify as "foreclosure property" within the meaning of
Section 860G(a)(8) of the Code or result in the receipt by the related REMIC of
any "income from non-permitted assets" within the meaning of Section
860F(a)(2)(B) of the Code, or any "net income from foreclosure property" which
is subject to taxation under the REMIC Provisions. The Servicer shall cause each
REO Property to be inspected promptly upon the acquisition of title thereto and
shall cause each REO Property to be inspected at least annually thereafter. The
Servicer shall make or cause to be made a written report of each such
inspection. Such reports shall be retained in the Mortgage Servicing File and
copies thereof shall be forwarded by the Servicer to the Trustee upon request.
The Servicer shall attempt to sell the same (and may temporarily rent the same)
on such terms and conditions as the Servicer deems to be in the best interest of
the Certificateholders and the Trust Fund.
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With respect to each REO Property, the Servicer shall account
separately for each REO Property with respect to all funds collected and
received in connection with the operation of such REO Property.
The Servicer shall deposit or cause to be deposited, on a daily basis,
within two Business Days of receipt, in the Collection Account, all revenues
received with respect to each REO Property and shall withdraw therefrom funds
necessary for the proper operation, management and maintenance of the related
REO Property, including the cost of maintaining any hazard insurance pursuant to
Section 3.10 hereof and the fees of any managing agent acting on behalf of the
Servicer.
The Servicer shall furnish to the Trustee, on each Servicer Remittance
Date, an operating statement for each REO Property covering the operation of
each REO Property for the previous month. Such operating statement shall be
accompanied by such other information as the Trustee shall reasonably request.
The Servicer shall use its best efforts to dispose of the REO Property
as promptly as is practically consistent with protecting the Certificateholders'
interests.
Each REO Disposition shall be carried out by the Servicer at such price
and upon such terms and conditions as the Servicer deems to be in the best
interest of the Certificateholders. If as of the date title to any REO Property
was acquired by the Servicer there were outstanding unreimbursed Servicing
Advances with respect to the REO Property or the related Mortgage Loan, the
Servicer, upon an REO Disposition of such REO Property, shall be entitled to
reimbursement for any related unreimbursed Servicing Advances from proceeds
received in connection with such REO Disposition. The proceeds from the REO
Disposition, net of any payment to the Servicer as provided above, shall be
deposited in the Collection Account for distribution on the succeeding Servicer
Remittance Date in accordance with Section 4.01.
Any REO Disposition shall be for cash only (unless changes in the REMIC
Provisions made subsequent to the Startup Day allow a sale for other
consideration and an Opinion of Counsel is obtained by the Servicer to the
effect that such sale shall not cause any REMIC constituting part of the Trust
Fund to fail to qualify as a REMIC).
(c) The Servicer may write-off any Second Lien Mortgage Loan that has been
Delinquent for a period of 180 days or more if the Servicer determines that any
amount that could be recovered on such Mortgage Loan would be less than the cost
required to achieve such recovery.
Section 3.14 Due-on-Sale Clauses; Assumption and Substitution
Agreements.
When a Mortgaged Property has been or is about to be conveyed by the
Mortgagor, the Servicer shall, to the extent it has knowledge of such conveyance
or prospective conveyance, exercise its rights to accelerate the maturity of the
related Mortgage Loan under any "due-on-sale" clause contained in the related
Mortgage or Mortgage Note; provided, however, that the Servicer shall not
exercise any such right if the "due-on-sale" clause, in the reasonable belief of
the Servicer, is not enforceable under applicable law. An Opinion of Counsel at
the expense of the Servicer (which expense shall constitute a Servicing Advance)
delivered to the Trustee and the Depositor to the foregoing effect shall
conclusively establish the reasonableness of such belief. In such event, the
Servicer shall make reasonable efforts to enter into an assumption and
modification agreement with the Person to whom such property has been or is
about to be conveyed, pursuant to which such Person becomes liable under the
Mortgage Note and, unless prohibited by applicable law or the Mortgage, the
Mortgagor remains liable thereon. If the foregoing is not permitted under
applicable law, the Servicer is authorized to enter into a substitution of
liability agreement with such Person, pursuant to which the original Mortgagor
is released from liability and such Person is substituted as Mortgagor and
becomes liable under the Note. In addition to the foregoing, the Servicer shall
not be required to enforce any "due-on-sale" clause if, in the reasonable
judgment of the Servicer, entering into an assumption and modification agreement
with a person to whom such Mortgaged Property shall be conveyed and releasing
the original Mortgagor from liability would be in the best interests of the
Certificateholders. The Mortgage Loan, as assumed, shall conform in all respects
to the requirements, representations and warranties of this Agreement. The
Servicer shall notify the Trustee that any such assumption or substitution
agreement has been completed by forwarding to the Trustee (or the Custodian, as
the case may be) the original copy of such assumption or substitution agreement
(indicating the Mortgage File to which it relates) which copy shall be added by
the Trustee (or the Custodian, as the case may be) to the related Mortgage File
and which shall, for all purposes, be considered a part of such Mortgage File to
the same extent as all other documents and instruments constituting a part
thereof. The Servicer shall be responsible for recording any such assumption or
substitution agreements. In connection with any such assumption or substitution
agreement, the Monthly Payment on the related Mortgage Loan shall not be changed
but shall remain as in effect immediately prior to the assumption or
substitution, the stated maturity or outstanding principal amount of such
Mortgage Loan shall not be changed nor shall any required monthly payments of
principal or interest be deferred or forgiven. Any fee collected by the Servicer
for consenting to any such conveyance or entering into an assumption or
substitution agreement shall be retained by or paid to the Servicer as
additional servicing compensation.
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Notwithstanding the foregoing paragraph or any other provision of this
Agreement, the Servicer shall not be deemed to be in default, breach or any
other violation of its obligations hereunder by reason of any assumption of a
Mortgage Loan by operation of law or any assumption which the Servicer may be
restricted by law from preventing, for any reason whatsoever.
Section 3.15 Notification of Adjustments.
On each Adjustment Date, the Servicer shall make Mortgage Interest Rate
adjustments for each Group I Mortgage Loan in compliance with the requirements
of the related Mortgage and Mortgage Note and Applicable Regulations. The
Servicer shall execute and deliver the notices required by each Mortgage and
Mortgage Note and Applicable Regulations regarding Mortgage Interest Rate
adjustments. The Servicer also shall provide timely notification to the Trustee
of all applicable data and information regarding such Mortgage Interest Rate
adjustments and the Servicer's methods of implementing such Mortgage Interest
Rate adjustments. Upon the discovery by the Servicer or the Trustee that the
Servicer has failed to adjust or has incorrectly adjusted a Mortgage Interest
Rate or a Monthly Payment pursuant to the terms of the related Mortgage Note and
Mortgage, the Servicer shall deliver to the Trustee for deposit in the
Distribution Account from its own funds the amount of any interest loss caused
thereby without reimbursement therefor; provided, however, the Servicer shall be
held harmless with respect to any Mortgage Interest Rate adjustments made by any
servicer prior to the Servicer.
Section 3.16 Optional Purchases of Mortgage Loans by Servicer.
The Servicer (or an affiliate of the Servicer) may, at its option,
repurchase a Mortgage Loan or REO Property which becomes 120 or more days
Delinquent or for which the Servicer has accepted a deed in lieu of foreclosure,
during the period commencing on the first day of the calendar quarter succeeding
the calendar quarter in which the Initial Delinquency Date occurred with respect
to such Mortgage Loan and ending on the last Business Day of such calendar
quarter. If the Servicer (or an affiliate of the Servicer) does not exercise its
purchase right with respect to a Mortgage Loan during the period specified in
the preceding sentence, such Mortgage Loan shall thereafter again become
eligible for purchase pursuant to the preceding sentence only after the Mortgage
Loan ceases to be 120 days or more Delinquent and thereafter becomes 120 days
Delinquent again. The "Initial Delinquency Date" of a Mortgage Loan shall mean
the date on which the Mortgage Loan first became 120 days Delinquent. Prior to
repurchase pursuant to this Section 3.16, the Servicer shall be required to
continue to make monthly advances pursuant to Section 4.07. The Servicer shall
not use any procedure in selecting Mortgage Loans to be repurchased which is
materially adverse to the interests of the Certificateholders. The Servicer
shall purchase such (i) delinquent Mortgage Loan at a price equal to the
Principal Balance of the Mortgage Loan plus accrued interest thereon at the
Mortgage Interest Rate from the date to which interest has last been paid to the
Trust Fund to the date of purchase plus any unreimbursed Servicing Advances and
Advances or (ii) REO Property at its fair market value as determined in good
faith by the Servicer. Any such repurchase of a Mortgage Loan or REO Property
pursuant to this Section 3.16(a) shall be accomplished by delivery to the
Trustee for deposit in the Distribution Account of the amount of the purchase
price. The Trustee shall immediately effectuate the conveyance of such
delinquent Mortgage Loan or REO Property to the Servicer to the extent
necessary, including the prompt delivery of all necessary documentation provided
by it to the Servicer.
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Section 3.17 Trustee to Cooperate; Release of Files.
(a) Upon the payment in full of any Mortgage Loan (including any
liquidation of such Mortgage Loan through foreclosure or otherwise, or the
receipt by the Servicer of a notification that payment in full will be escrowed
in a manner customary for such purposes), the Servicer shall deliver to the
Trustee (or the Custodian as the case may be) two executed copies of a completed
"Request for Release" in the form of Exhibit E. Upon receipt of such Request for
Release of Documents, the Trustee (or the Custodian as the case may be) shall
promptly release the related Mortgage File, in trust to (i) the Servicer, or
(ii) such other party identified in the related Request for Release. Upon any
such payment in full, or the receipt of such notification that such funds have
been placed in escrow, the Servicer shall direct the Trustee in writing to
execute an instrument of satisfaction (or assignment of Mortgage without
recourse, representation or warranty) regarding the Mortgaged Property relating
to such Mortgage, which instrument of satisfaction or assignment, as the case
may be, shall be delivered to the Person or Persons entitled thereto against
receipt therefor of payment in full, it being understood and agreed that no
expense incurred in connection with such instrument of satisfaction or
assignment, as the case may be, shall be chargeable to the Collection Account.
In lieu of executing any such satisfaction or assignment, as the case may be,
the Servicer may prepare and submit to the Trustee a satisfaction (or assignment
without recourse, representation or warranty if requested by the Person or
Persons entitled thereto) in form for execution by the Trustee with all
requisite information completed by the Servicer; in such event, the Trustee
shall execute and acknowledge such satisfaction or assignment, as the case may
be, and deliver the same with the related Mortgage File, as aforesaid.
(b) From time to time and as appropriate in the servicing of any
Mortgage Loan, including, without limitation, foreclosure or other comparable
conversion of a Mortgage Loan or collection under any insurance policy relating
to a Mortgage Loan, the Trustee shall (except in the case of the payment or
liquidation pursuant to which the related Mortgage File is released to an escrow
agent or an employee, agent or attorney of the Trustee), upon written request of
the Servicer and delivery to the Trustee (or the Custodian, as the case may be)
of two executed copies of a "Request for Release" in the form of Exhibit E
signed by a Servicing Officer, release the related Mortgage File to the Servicer
and shall execute such documents as shall be necessary to the prosecution of any
such proceedings, including, without limitation, an assignment without recourse,
representation or warranty of the related Mortgage to the Servicer. Such receipt
shall obligate the Servicer to return the Mortgage File to the Trustee (or the
Custodian, as the case may be) when the need therefor by the Servicer no longer
exists unless the Mortgage Loan shall be liquidated, in which case, upon receipt
of a Request for Release evidencing such liquidation, the receipt shall be
released by the Trustee (or the Custodian, as the case may be) to the Servicer.
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(c) Subject to Section 3.01, the Servicer shall have the right to
accept applications of Mortgagors for consent to (i) partial releases of
Mortgages, (ii) alterations, (iii) removal, demolition or division of properties
subject to Mortgages and (iv) second mortgage subordination agreements. No
application for approval shall be considered by the Servicer unless: (w) it has
received an Opinion of Counsel, addressed to the Trustee (which opinion shall
not be an expense of the Trustee or the Trust Fund) that such sale, disposition,
substitution, acquisition or contribution will not affect adversely the status
of any REMIC constituting part of the Trust Fund as a REMIC or cause any REMIC
constituting part of the Trust Fund to be subject to a tax on "prohibited
transactions" or "contributions" pursuant to the REMIC Provisions; (x) the
provisions of the related Mortgage Note and Mortgage have been complied with;
(y) the Combined Loan-to-Value Ratio and debt-to-income ratio after any release
does not exceed the maximum Combined Loan-to-Value Ratio and debt-to-income
ratio established in accordance with the underwriting standards of the Mortgage
Loans; and (z) the lien priority of the related Mortgage is not affected. Upon
receipt by the Trustee of a Servicing Officer's certificate setting forth the
action proposed to be taken in respect of a particular Mortgage Loan and
certifying that the criteria set forth in the immediately preceding sentence
have been satisfied, the Trustee shall execute and deliver to the Servicer the
consent or partial release so requested by the Servicer. A proposed form of
consent or partial release, as the case may be, shall accompany any Servicing
Officer's certificate delivered by the Servicer pursuant to this paragraph.
Section 3.18 Servicing Compensation.
As compensation for its activities hereunder, the Servicer shall be
entitled to retain the amount of the Servicing Fee with respect to each Mortgage
Loan (including REO Properties). The Servicer shall be entitled to retain
additional servicing compensation in the form of release fees, bad check
charges, assumption fees, modification or extension fees, late payment charges,
customary real-estate referral fees or any other service-related fees, Insurance
Proceeds and Liquidation Proceeds not required to be deposited in the Collection
Account or the Distribution Account and similar items, to the extent collected
from Mortgagors.
Section 3.19 Annual Statement as to Compliance.
(a) The Servicer, at its own expense, will deliver to the Trustee and
the Depositor, not later than March 15 of each year, commencing in 2007, a
Servicing Officer's certificate, in the form attached hereto as Exhibit P-4,
stating, as to each signer thereof, that (i) a review of the activities of the
Servicer during such preceding calendar year (or such shorter period in the case
of the first such report) and of performance of such Servicer under this
Agreement has been made under such officers' supervision, and (ii) to the best
of such officers' knowledge, based on such review, the Servicer has fulfilled
all its obligations under this Agreement for such year, or, if there has been a
failure to fulfill any such obligation in any material respect throughout such
year, specifying each failure known to such officer and the nature and status
thereof. During the period when reports under the Exchange Act are required to
be filed, with respect to any Subservicer that meets the criteria of Item
1108(a)(2)(i) through (iii) of Regulation AB, the Servicer shall cause each
Subservicer to deliver the Officer's Certificate set forth in this Section
3.19(a) as and when required with respect to the Servicer. For purposes of
clause (ii) above, the Servicer or Subservicer will be entitled to rely upon a
certification received by any Subcontractor.
(b) Delivery of such reports, information and documents to the Trustee
is for informational purposes only and its receipt of such shall not constitute
constructive notice of any information contained therein or determinable, from
information contained therein, including the Servicer's compliance with any of
its covenants hereunder (as to which the Trustee is entitled to rely exclusively
on Officers' Certificates).
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Section 3.20 Reports on Assessment of Compliance and Attestation.
(a) Not later than the earlier of (a) March 15 of each calendar year
(other than the calendar year during which the Closing Date occurs) or (b) with
respect to any calendar year during which an annual report on Form 10-K is
required to be filed pursuant to Section 3.29 on behalf of the Trust, 15
calendar days before each date on which that annual report on Form 10-K is
required to be filed, pursuant to Section 3.29 (or if such day is not a Business
Day, the immediately preceding Business Day), the Servicer, at its own expense,
shall deliver to the Depositor, the Trustee and each Rating Agency an officer's
certification and assessment of its compliance with the Servicing Criteria
during the preceding calendar year as required by Rules 13a-18 and 15d-18 of the
Exchange Act and Item 1122 of Regulation AB (the "Assessment of Compliance"),
which assessment shall be substantially in the form of Exhibit P-1 hereto. The
parties acknowledge and agree that the items indicated as being subject to
assessment by each such party on Exhibit P-2 hereto are the items to be assessed
by such party as of the Closing Date and that any changes to such allocation of
assessment responsibilities will be made by mutual agreement of the parties. Any
such changes will not require an amendment of this Agreement.
(b) Not later than the earlier of (a) March 15 of each calendar year
(other than the calendar year during which the Closing Date occurs) or (b) with
respect to any calendar year during which an annual report on Form 10-K is
required to be filed pursuant to Section 3.29 on behalf of the Trust, 15
calendar days before each date on which that annual report on Form 10-K is
required to be filed pursuant to Section 3.29 (or if such day is not a Business
Day, the immediately preceding Business Day), the Servicer, at its own expense,
shall cause a nationally or regionally recognized firm of independent registered
public accountants (who may also render other services to the Servicer, the
Sponsor or any affiliate thereof), which is a member of the American Institute
of Certified Public Accountants to furnish a statement to the Depositor and the
Trustee, that attests to and reports on the assessment of compliance provided by
the Servicer pursuant to Section 3.20(a) (the "Accountant's Attestation"). Such
Accountant's Attestation shall be in accordance with Rules 1-02(a)(3) and
2-02(g) of Regulation S-X under the Securities Act and the Exchange Act.
(c) The Servicer shall cause any Subservicer and each Subcontractor to
deliver, if applicable, with respect to any calendar year during which the
Depositor's annual report on Form 10-K is required to be filed in accordance
with the Exchange Act and the rules and regulations of the Securities and
Exchange Commission, 15 calendar days before the date on which the Depositor's
annual report on Form 10-K is required to be filed in accordance with the
Exchange Act and the rules and regulations of the Securities and Exchange
Commission (or, in each case, if such day is not a Business Day, the immediately
preceding Business Day) to the Depositor and the Trustee an Assessment of
Compliance, which assessment shall be substantially in the form of Exhibit P-1
hereto.
(d) With respect to any calendar year during which the Depositor's
annual report on Form 10-K is required to be filed in accordance with the
Exchange Act and the rules and regulations of the Securities and Exchange
Commission, 15 calendar days before the date on which the Depositor's annual
report on Form 10-K is required to be filed in accordance with the Exchange Act
and the rules and regulations of the Securities and Exchange Commission (or, in
each case, if such day is not a Business Day, the immediately preceding Business
Day), the Servicer shall cause each Subservicer and each Subcontractor to
deliver to the Depositor and the Trustee an Accountant's Attestation by a
registered public accounting firm that attests to, and reports on, the
Assessment of Compliance pursuant to Section 3.20 (c) above.
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(e) With respect to any calendar year during which the Depositor's
annual report on Form 10-K is required to be filed in accordance with the
Exchange Act and the rules and regulations of the Securities and Exchange
Commission, not later than 15 calendar days before the date on which the
Depositor's annual report on Form 10-K is required to be filed in accordance
with the Exchange Act and the rules and regulations of the Securities and
Exchange Commission (or, in each case, if such day is not a Business Day, the
immediately preceding Business Day), the Depositor shall cause the Custodian to
deliver to the Depositor and the Trustee an Assessment of Compliance with regard
to the Servicing Criteria applicable to the Custodian during the preceding
calendar year, which assessment shall be substantially in the form of Exhibit
P-1 hereto.
(f) With respect to any calendar year during which the Depositor's
annual report on Form 10-K is required to be filed in accordance with the
Exchange Act and the rules and regulations of the Securities and Exchange
Commission, not later than 15 calendar days before the date on which the
Depositor's annual report on Form 10-K is required to be filed in accordance
with the Exchange Act and the rules and regulations of the Securities and
Exchange Commission (or, in each case, if such day is not a Business Day, the
immediately preceding Business Day), the Depositor shall cause the Custodian to
deliver to the Depositor and the Trustee an Accountant's Attestation by a
registered public accounting firm that attests to, and reports on, the
Assessment of Compliance pursuant to Section 3.20(e) above.
(g) With respect to any calendar year during which the Depositor's
annual report on Form 10-K is required to be filed in accordance with the
Exchange Act and the rules and regulations of the Securities and Exchange
Commission, not later than 15 calendar days before the date on which the
Depositor's annual report on Form 10-K is required to be filed in accordance
with the Exchange Act and the rules and regulations of the Securities and
Exchange Commission (or, in each case, if such day is not a Business Day, the
immediately preceding Business Day), the Depositor shall cause the Trustee to
deliver to the Depositor an Assessment of Compliance with regard to the
Servicing Criteria applicable to the Trustee during the preceding calendar year,
which assessment shall be substantially in the form of Exhibit P-1 hereto.
(h) With respect to any calendar year during which the Depositor's
annual report on Form 10-K is required to be filed in accordance with the
Exchange Act and the rules and regulations of the Securities and Exchange
Commission, not later than 15 calendar days before the date on which the
Depositor's annual report on Form 10-K is required to be filed in accordance
with the Exchange Act and the rules and regulations of the Securities and
Exchange Commission (or, in each case, if such day is not a Business Day, the
immediately preceding Business Day), the Depositor shall cause the Trustee to
deliver to the Depositor an Accountant's Attestation by a registered public
accounting firm that attests to, and reports on, the Assessment of Compliance
pursuant to Section 3.20(g) above.
(i) The Servicer agrees to indemnify and hold harmless each of the
Depositor, the Trustee and each Person, if any, who "controls" the Depositor or
the Trustee within the meaning of the Securities Act and their respective
officers, directors and affiliates from and against any losses, damages,
penalties, fines, forfeitures, reasonable and necessary legal fees and related
costs, judgments and other costs and expenses that such Person actually sustains
out of third party claims based on (i) the failure of the Servicer or any
related Subservicer or Subcontractor to deliver or cause to be delivered when
required any Assessment of Compliance or Accountant's Attestation required of it
pursuant to this Section 3.20, as applicable, or (ii) any material misstatement
contained in any Assessment of Compliance provided on its behalf pursuant to
Section 3.21, as applicable.
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(j) The Trustee agrees to indemnify and hold harmless each of the
Depositor, the Servicer and each Person, if any, who "controls" the Depositor or
the Servicer within the meaning of the Securities Act and their respective
officers, directors and affiliates from and against any losses, damages,
penalties, fines, forfeitures, reasonable and necessary legal fees and related
costs, judgments and other costs and expenses that such Person may sustain
arising out of third party claims based on (i) the failure of the Trustee to
deliver or cause to be delivered when required any Assessment of Compliance or
Accountant's Attestation required of it pursuant to Section 3.20, as applicable,
or (ii) any material misstatement contained in any Assessment of Compliance
provided on its behalf pursuant to this Section 3.21, as applicable.
(k) Copies of such Assessments of Compliance and Accountant's
Attestations shall be provided by the Trustee to any Certificateholder, upon
request, provided such statement is delivered to the Trustee. The initial
Assessments of Compliance and Accountant's Attestations required pursuant to
this Section 3.20 shall be delivered to the Trustee and the Depositor, as
applicable, by each party no later than March 15, 2007.
Section 3.21 Access to Certain Documentation and Information Regarding
the Mortgage Loans.
The Servicer shall provide to the Trustee, Certificateholders that are
federally insured savings and loan associations, the Office of Thrift
Supervision, the FDIC and the supervisory agents and examiners of each of the
foregoing (which, in the case of supervisory agents and examiners, may be
required by applicable state and federal regulations) access to the
documentation regarding the Mortgage Loans, such access being afforded without
charge but only upon reasonable request and during normal business hours at the
offices of the Servicer designated by it.
Section 3.22 Reserved.
Section 3.23 Obligations of the Servicer in Respect of Compensating
Interest.
Not later than the close of business on each Servicer Remittance Date,
the Servicer shall deliver to the Trustee for deposit in the Distribution
Account an amount ("Compensating Interest") equal to the lesser of (A) the
aggregate of the Prepayment Interest Shortfalls on the Mortgage Loans for the
related Distribution Date resulting from Principal Prepayments in full on the
Mortgage Loans during the related Prepayment Period and (B) 50% of its aggregate
Servicing Fee received in the related Collection Period. The Servicer shall
apply Compensating Interest to offset any Prepayment Interest Shortfalls on the
Mortgage Loans. The Servicer shall not have the right to reimbursement for any
amounts remitted to the Trustee in respect of Compensating Interest. Such
amounts so remitted shall be included in the Available Funds and distributed
therewith on the next Distribution Date. The Servicer shall not be obligated to
pay Compensating Interest with respect to Prepayment Interest Shortfalls on
Relief Act Interest Shortfalls.
Section 3.24 Obligations of the Servicer in Respect of Mortgage
Interest Rates and Monthly Payments.
In the event that a shortfall in any collection on or liability with
respect to any Mortgage Loan results from or is attributable to adjustments to
Mortgage Interest Rates, Monthly Payments or Principal Balances that were made
by the Servicer in a manner not consistent with the terms of the related
Mortgage Note and this Agreement, the Servicer, upon discovery or receipt of
notice thereof, immediately shall deliver to the Trustee for deposit in the
Distribution Account from its own funds the amount of any such shortfall and
shall indemnify and hold harmless the Trust Fund, the Trustee, the Depositor and
any successor servicer in respect of any such liability. Such indemnities shall
survive the termination or discharge of this Agreement.
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Section 3.25 Investment of Funds in the Collection Account and the
Distribution Account.
(a) The Servicer may direct any depository institution maintaining the
Collection Account to invest the funds in the Collection Account in one or more
Permitted Investments bearing interest or sold at a discount, and maturing,
unless payable on demand, (i) no later than the Business Day immediately
preceding the date on which such funds are required to be withdrawn from such
account pursuant to this Agreement, if a Person other than the Trustee is the
obligor thereon, and (ii) no later than the date on which such funds are
required to be withdrawn from such account pursuant to this Agreement, if the
Trustee is the obligor thereon. In the absence of such direction, funds in the
Collection Account shall remain uninvested. All such Permitted Investments shall
be held to maturity, unless payable on demand. Any investment of funds in the
Collection Account shall be made in the name of the Trustee or the Servicer, as
applicable (in its capacity as such) or in the name of a nominee of the Trustee.
The Trustee shall be entitled to sole possession (except with respect to
investment direction of funds held in the Collection Account) over each such
investment and the income thereon, and any certificate or other instrument
evidencing any such investment shall be delivered directly to the Trustee or its
agent, together with any document of transfer necessary to transfer title to
such investment to the Trustee or its nominee. In the event amounts on deposit
in the Collection Account are at any time invested in a Permitted Investment
payable on demand, the Trustee shall at the direction of the Servicer:
(x) consistent with any notice required to be given
thereunder, demand that payment thereon be made on
the last day such Permitted Investment may otherwise
mature hereunder in an amount equal to the lesser of
(1) all amounts then payable thereunder and (2) the
amount required to be withdrawn on such date; and
(y) demand payment of all amounts due thereunder promptly
upon determination by a Responsible Officer of the
Trustee that such Permitted Investment would not
constitute a Permitted Investment in respect of funds
thereafter on deposit in the Collection Account.
(b) All income and gain realized from the investment of funds in the
Collection Account shall be for the benefit of the Servicer. The Servicer shall
deposit in the Collection Account the amount of any loss incurred in respect of
any such Permitted Investment made with funds in such account immediately upon
realization of such loss. Funds on deposit in the Distribution Account will
remain uninvested.
(c) Except as otherwise expressly provided in this Agreement, if any
default occurs in the making of a payment due under any Permitted Investment, or
if a default occurs in any other performance required under any Permitted
Investment, the Trustee may and, subject to Section 8.01 and Section 8.02(a)(v),
upon the request of the Holders of Certificates representing more than 50% of
the Voting Rights allocated to any Class of Certificates, shall take such action
as may be appropriate to enforce such payment or performance, including the
institution and prosecution of appropriate proceedings.
The Trustee shall not in any way be held liable by reason of any
insufficiency in any Account held by the Trustee 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).
Section 3.26 Liability of Servicer; Indemnification.
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(a) Subject to clause (b) below and Section 6.03, the Servicer (or its
successor hereunder (except the Trustee if it is required to succeed the
Servicer hereunder)) indemnifies and holds the Trustee, the Sponsor, the
Depositor and each Certificateholder harmless against any and all claims,
losses, penalties, fines, forfeitures, reasonable legal fees and related costs,
judgments, and any other costs, fees and expenses that the Trustee, the
Depositor and any Certificateholder may sustain in any way related to the
failure of the Servicer to perform its duties and service the Mortgage Loans in
compliance with the Servicing Standards. The Servicer shall immediately notify
the Trustee, the Depositor and each Certificateholder if a claim is made that
may result in such claims, losses, penalties, fines, forfeitures, legal fees or
related costs, judgments, or any other costs, fees and expenses, and the
Servicer shall assume (with the consent of the Trustee) the defense of any such
claim and pay all expenses in connection therewith, including reasonable counsel
fees, and promptly pay, discharge and satisfy any judgment or decree which may
be entered against the Servicer, Trustee, the Depositor and/or Certificateholder
in respect of such claim. The provisions of this Section 3.26 shall survive the
termination of this Agreement, the termination or resignation of the Servicer or
the Trustee and the payment of the outstanding Certificates.
(b) None of the Depositor, the Sponsor, the Servicer, or any of the
directors, officers, employees or agents of the Depositor, the Sponsor or the
Servicer shall be under any liability to the Trust Fund or the
Certificateholders for any action taken, or for refraining from the taking of
any action, in good faith pursuant to this Agreement, or for errors in judgment;
provided, however, that this provision shall not protect the Depositor, the
Sponsor or the Servicer or any such Person against any breach of warranties or
representations made herein, or against any specific liability imposed on the
Servicer for a breach of the Servicing Standard, or against any liability which
would otherwise be imposed by reason of its respective willful misfeasance, bad
faith, fraud or negligence in the performance of its duties or by reasons of
negligent disregard of its respective obligations or duties hereunder.
The Depositor, the Servicer, the Sponsor and any director, officer,
employee or agent of the Depositor, the Sponsor or the Servicer, may rely in
good faith on any document of any kind which, prima facie, is properly executed
and submitted by any appropriate Person with respect to any matters arising
hereunder. The Depositor, the Servicer, the Sponsor, and any director, officer,
employee or agent of the Depositor, the Sponsor or the Servicer shall be
indemnified and held harmless by the Trust Fund against any loss, liability or
expense incurred in connection with any legal action relating to this Agreement
or the Certificates, other than any loss, liability or expense incurred in
connection with any legal action incurred by reason of its respective
misfeasance, bad faith, fraud or negligence, a breach of a representation or
warranty hereunder or (in the case of the Servicer) a breach of the Servicing
Standard in the performance of its respective duties or by reason of negligent
disregard of its respective obligations or duties hereunder. Neither the
Depositor, the Sponsor nor the Servicer shall be under any obligation to appear
in, prosecute or defend any legal action unless such action is related to its
respective duties under this Agreement and in its opinion does not expose it to
any expense or liability; provided, however, that the Depositor, the Sponsor or
the Servicer may in its discretion undertake any action related to its
obligations hereunder which it may deem necessary or desirable with respect to
this Agreement and the rights and duties of the parties hereto and the interests
of the Certificateholders hereunder.
Section 3.27 Reports of Foreclosure and Abandonment of Mortgaged
Properties.
On or before the last day of February of each year beginning in 2007,
the Servicer shall file the reports of foreclosure and abandonment of any
Mortgaged Property required by Section 6050J of the Code with the Internal
Revenue Service and provide an Officer's Certificate certifying its compliance
with this Section 3.27 to the Trustee. The reports from the Servicer shall be in
form and substance sufficient to meet the reporting requirements imposed by such
Section 6050J.
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Section 3.28 Protection of Assets.
(a) Except for transactions and activities entered into in connection
with the securitization that is the subject of this Agreement, the Trust is not
authorized and has no power to:
(1) borrow money or issue debt;
(2) merge with another entity, reorganize, liquidate or sell
assets; or
(3) engage in any business or activities.
(b) Each party to this Agreement agrees that it will not file an
involuntary bankruptcy petition against the Trustee or the Trust Fund or
initiate any other form of insolvency proceeding until after the Certificates
have been paid.
Section 3.29 Periodic Filings.
(a) The Trustee will prepare and file Current Reports on Form 8-K in
respect of the Trust at the direction and expense of the Depositor, provided,
that, as set forth on Exhibit R, the Depositor, the Sponsor or the Servicer
shall have timely notified the Trustee of an item reportable on a Form 8-K and
shall have delivered to the Trustee no later than three Business Days prior to
the filing deadline for such Form 8-K, all information, data, and exhibits
required to be provided or filed with such Form 8-K in electronic or other such
other format reasonably acceptable to the Trustee. To the extent that a
Responsible Officer of the Trustee has actual knowledge of an event relating to
Items 3.03, 6.02, 6.03 or 6.04 of Form 8-K listed on Exhibit R hereto, the
Trustee shall notify the Depositor of such event. The Trustee shall not be
responsible for determining what information is required to be filed on a Form
8-K in connection with the transactions contemplated by this Agreement or what
events shall cause a Form 8-K to be required to be filed and shall not be liable
for any late filing of a Form 8-K in the event that it does not receive all
information, data, signatures and exhibits required to be provided or filed on
or prior to the second Business Day prior to the applicable filing deadline.
Within 15 days after each Distribution Date, the Trustee shall, on behalf of the
Trust and in accordance with industry standards, file with the Securities and
Exchange Commission via the Electronic Data Gathering and Retrieval System
("XXXXX"), a Form 10-D (or other comparable form containing the same or
comparable information or other information mutually agreed upon) with, as set
forth on Exhibit S, (1) a copy of the report to the Certificateholders for such
Distribution Date as an exhibit thereto and (2) such other information provided
to the Trustee as identified on Exhibit S; provided that such information is
provided to the Trustee no later than the first Business Day immediately
following the related Distribution Date. Prior to Xxxxx 00, 0000 (xxx, if
applicable, prior to March 30 of each subsequent year), the Trustee shall, on
behalf of the Trust and in accordance with industry standards, prepare and file
with the Securities and Exchange Commission via XXXXX a Form 10-K with respect
to the Trust Fund. As set forth on Exhibit T, such Form 10-K shall include as
exhibits, each annual statement of compliance required to be delivered pursuant
to Section 3.19 and each Accountant's Attestation and Assessment of Compliance
required to be furnished pursuant to Section 3.20, in each case to the extent
they have been timely delivered to the Trustee (or the Depositor, in the case of
the Trustee's Assessment of Compliance) and such other information as is
required by Regulation AB. The Servicer will cause its senior officer in charge
of securitization to execute the certification, in the form attached hereto as
Exhibit P-3 (the "Form 10-K Certification") required pursuant to Rule 13a -14
under the Securities Exchange Act of 1934, as amended, and the Trustee shall
file the same with the Securities and Exchange Commission prior to Xxxxx 00,
0000 (xxx, if applicable, prior to March 30 of each year). In connection
therewith, the Trustee shall sign a certification (in the form attached hereto
as Exhibit P-5) for the benefit of the Depositor and the Servicer and their
officers, directors and affiliates regarding certain aspects of the Form 10-K
Certification. To the extent any information or exhibits required to be included
in the Form 10-K are not timely received by the Trustee prior to March 30, the
Trustee shall, on behalf of the Trust, file one or more amended Form 10-Ks to
include such missing information or exhibits promptly after receipt thereof by
the Trustee. Promptly following the first date legally permissible under
applicable regulations and interpretations of the Securities and Exchange
Commission, the Trustee shall, on behalf of the Trust and in accordance with
industry standards, file with the Securities and Exchange Commission via XXXXX a
Form 15 Suspension Notification with respect to the Trust Fund, if applicable.
The Servicer agrees to furnish to the Trustee promptly, from time to time upon
request, such further information, reports and financial statements within its
control related to this Agreement and the Mortgage Loans as the Trustee
reasonably deems appropriate to prepare and file all necessary reports with the
Securities and Exchange Commission. The Trustee shall attach to any Form 10-D
the signature page of the Servicer (such signature page to have been delivered
by the Servicer to the Trustee on the Closing Date) and submit such Form 10-D
for filing with the Securities and Exchange Commission. The Trustee shall
provide a copy of each Form 10-D and Form 8-K to each of the Servicer and the
Depositor. The Trustee shall have no responsibility to file any items with the
Securities and Exchange Commission other than those specified in this section
and the Servicer shall execute any and all Form 8-Ks, 10-Ds and 10-Ks required
hereunder. All materials provided to the Trustee relating to the Form 8-Ks,
10-Ds and 10-Ks required hereunder shall be provided in electronic format
compatible with the XXXXX system, which may be in Microsoft Word. To the extent
that (i) no notice is provided to the Trustee of events or information
reportable in any Form 8-K, (ii) no notice is provided of events or information
reportable in any Form 10-D by the first Busines Day after the related
Distribution Date (or) (iii) no notice is provided of events or information
reportable in any Form 10-K by March 30 of each year, in each case the Trustee
shall without further notice conclude that there is no event or information to
be reported. Notwithstanding anything set forth herein, the Servicer will not be
responsible for the filing of any Form 8-K or Form 10-D filed on behalf of the
Trust (including but not limited to the timing of any filing or completeness of
such filings) and will not be responsible for determining whether the content of
any Form 8-K or Form 10-D filed on behalf of the Trustee is accurate or correct
(unless such information is contained in the Remittance Report or otherwise
specific to the Servicer, in which case the Servicer will be responsible for
making such determination).
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(b) The Trustee shall indemnify and hold harmless the Servicer and its
officers, directors and Affiliates from and against any losses, damages,
penalties, fines, forfeitures, reasonable and necessary legal fees and related
costs, judgments and other costs and expenses arising out of the Trustee's
failure to deliver the certification (in the form attached hereto as Exhibit
P-5) pursuant to Section 3.29(a) or any inaccuracy in such certification, other
than any losses, damages, penalties, fines, forfeitures, reasonable and
necessary legal fees and related costs, judgments and other costs and expenses
arising out of the Servicer's breach of its obligations under this Agreement. If
the indemnification provided for herein is unavailable or insufficient to hold
harmless the Servicer and its officers, directors and Affiliates, then the
Trustee shall contribute to the amount paid or payable by the Servicer, its
officers, directors or Affiliates as a result of the losses, claims, damages or
liabilities of the Servicer, its officers, directors or Affiliates in such
proportion as is appropriate to reflect the relative fault of the Servicer and
its officers, directors and Affiliates on the one hand and the Trustee on the
other.
(c) The Servicer shall indemnify and hold harmless the Trustee and its
officers, directors and Affiliates from and against any losses, damages,
penalties, fines, forfeitures, reasonable and necessary legal fees and related
costs, judgments and other costs and expenses arising out of the Servicer's
failure to sign and deliver either the certification or the Form 10-K within the
time frame provided in Section 3.29(a), other than any losses, damages,
penalties, fines, forfeitures, reasonable and necessary legal fees and related
costs, judgments and other costs and expenses arising out of the Trustee's
breach of its obligations under this Agreement. If the indemnification provided
for herein is unavailable or insufficient to hold harmless the Trustee and its
officers, directors and Affiliates, then the Servicer shall contribute to the
amount paid or payable by the Trustee, its officers, directors or Affiliates as
a result of the losses, claims, damages or liabilities of the Trustee, its
officers, directors or Affiliates in such proportion as is appropriate to
reflect the relative fault of the Trustee and its officers, directors and
Affiliate on the one hand and the Servicer on the other.
(d) If the Securities and Exchange Commission issues additional
interpretative guidance or promulgates additional rules or regulations with
respect to Regulation AB or otherwise, or if other changes in applicable law
occur, that would require the reporting arrangements, or the allocation of
responsibilities with respect thereto, described in this Section 3.29, to be
conducted differently than as described, the Depositor, the Servicer, and the
Trustee will reasonably cooperate to amend the provisions of this Section 3.29
in order to comply with such amended reporting requirements and such amendment
of this Section 3.29. Any such amendment shall be made in accordance with the
first paragraph of Section 11.01 without the consent of the Certificateholders
and without the requirement to deliver notice in writing to the Depositor, the
Servicer and the Trustee from the Rating Agencies that such action will not
result in the reduction or withdrawal of the rating of any outstanding Class of
Certificates with respect to which it is a Rating Agency. Such Amendment may
result in the reduction of the reports filed by the Trustee on behalf of the
Trust under the Exchange Act. Notwithstanding the foregoing, none of the
Depositor, the Servicer and the Trustee shall be obligated to enter into any
amendment pursuant to this Section 3.29 that adversely affects its obligations
and immunities under this Agreement.
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(e) In filing any Monthly Form 8-K or Form 10-K, the Trustee shall not
undertake any analysis of, and shall have no responsibility for, any financial
information, accountant's report, certification or other matter contained
therein, except for computations performed by the Trustee and reflected in the
statement set forth in Section 4.06(a) hereof.
(f) The Depositor, the Servicer and the Trustee agree to use their good
faith efforts to cooperate in complying with the requirements of this Section
3.29.
(g) Upon any filing with the Securities and Exchange Commission, the
Trustee shall promptly deliver to the Depositor and the Servicer a copy of any
such executed report, statement or information.
(h) The obligations set forth in paragraphs (a) and (b) of this Section
shall only apply with respect to periods for which reports are required to be
filed with respect to the Trust under the Exchange Act. Prior to January 30 of
the first year in which the Trustee is able to do so under applicable law, the
Trustee shall file a Form 15 Suspension Notification with respect to the Trust.
At any time after the filing of a Form 15 Suspension Notification, if the number
of Certificateholders of record exceeds the number set forth in Section 15(d) of
the Exchange Act or the regulations promulgated pursuant thereto which would
cause the Trust to again become subject to the reporting requirements of the
Exchange Act, the Trustee, solely at the Depositor's prior written direction and
expense, shall recommence preparing and filing reports on Form 10-K and 10-D as
required pursuant to this Section 3.29 and the parties hereto shall again have
the obligations set forth in this Section.
(i) For so long as reports are required to be filed with the Securities
and Exchange Commission under the Exchange Act with respect to the Trust, each
of the Depositor, the Trustee, the Servicer and the Sponsor shall notify the
Depositor and the Trustee in writing of any litigation or proceeding that would
be material to Certificateholders pending against such notifying person (or, in
the case of the Servicer, against the Servicer or any Subservicer engaged by
it), or, with respect to the Depositor, the Trustee and the Sponsor, any
affiliations or relationships that develop following the Closing Date between
such notifying person (or, in the case of the Servicer, between the Servicer or
any Subservicer engaged by it) and any other party hereto or the Originator,
that may have to be reported on a Form 8-K, Form 10-K or Form 10-D with respect
to the Trust.
Section 3.30 Advance Facility.
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(a) The Servicer is hereby authorized to enter into a financing or
other facility (any such arrangement, an "Advance Facility"), the documentation
for which complies with Section 3.30(e) below, under which (1) the Servicer
assigns or pledges its rights under this Agreement to be reimbursed for any or
all Advances and/or Servicing Advances to (i) a Person, which may be a
special-purpose bankruptcy-remote entity (an "SPV"), (ii) a Person, which may
simultaneously assign or pledge such rights to an SPV or (iii) a lender (a
"Lender"), which, in the case of any Person or SPV of the type described in
either of the preceding clauses (i) or (ii), may directly or through other
assignees and/or pledgees, assign or pledge such rights to a Person, which may
include a trustee acting on behalf of holders of debt instruments (any such
Person or any such Lender, an "Advance Financing Person"), and/or (2) an Advance
Financing Person agrees to fund all the Advances and/or Servicing Advances
required to be made by the Servicer pursuant to this Agreement. No consent of
the Trustee, Certificateholders or any other party shall be required before the
Servicer may enter into an Advance Facility nor shall the Trustee or the
Certificateholders be a third party beneficiary of any obligation of an Advance
Financing Person to the Servicer. Notwithstanding the existence of any Advance
Facility under which an Advance Financing Person agrees to fund Advances and/or
Servicing Advances, (A) the Servicer (i) shall remain obligated pursuant to this
Agreement to make Advances and/or Servicing Advances pursuant to and as required
by this Agreement and (ii) shall not be relieved of such obligations by virtue
of such Advance Facility and (B) neither the Advance Financing Person nor any
Servicer's Assignee (as hereinafter defined) shall have any right to proceed
against or otherwise contact any Mortgagor for the purpose of collecting any
payment that may be due with respect to any related Mortgage Loan or enforcing
any covenant of such Mortgagor under the related Mortgage Loan documents.
(b) If the Servicer enters into an Advance Facility, the Servicer and
the related Advance Financing Person shall deliver to the Trustee at the address
set forth in Section 11.05 hereof a written notice (an "Advance Facility
Notice"), stating (a) the identity of the Advance Financing Person and (b) the
identity of the Person (the "Servicer's Assignee") that will, subject to Section
3.30(c) hereof, have the right to make withdrawals from the Collection Account
pursuant to Section 3.05 hereof to reimburse previously unreimbursed Advances
and/or Servicing Advances ("Advance Reimbursement Amounts"). Advance
Reimbursement Amounts (i) shall consist solely of amounts in respect of Advances
and/or Servicing Advances for which the Servicer would be permitted to reimburse
itself in accordance with Section 3.05 hereof, assuming the Servicer had made
the related Advance(s) and/or Servicing Advance(s) and (ii) shall not consist of
amounts payable to a successor Servicer in accordance with Section 3.05 hereof
to the extent permitted under Section 3.30(e) below.
(c) Notwithstanding the existence of an Advance Facility, the Servicer,
on behalf of the Advance Financing Person, and the Servicer's Assignee shall be
entitled to receive reimbursements of Advances and/or Servicing Advances in
accordance with Section 3.05 hereof, which entitlement may be terminated by the
Advance Financing Person pursuant to a written notice to the Trustee in the
manner set forth in Section 11.05 hereof. Upon receipt of such written notice,
the Servicer shall no longer be entitled to receive reimbursement for any
Advance Reimbursement Amounts and the Servicer's Assignee shall immediately have
the right to receive from the Collection Account all Advance Reimbursement
Amounts. Notwithstanding the foregoing, and for the avoidance of doubt, (i) the
Servicer and/or the Servicer's Assignee shall only be entitled to reimbursement
of Advance Reimbursement Amounts hereunder from withdrawals from the Collection
Account pursuant to Section 3.05 of this Agreement and shall not otherwise be
entitled to make withdrawals of, or receive, Advance Reimbursement Amounts that
shall be deposited in the Distribution Account pursuant to Section 3.04(b)
hereof, and (ii) none of the Trustee or the Certificateholders shall have any
right to, or otherwise be entitled to, receive any Advance Reimbursement Amounts
to which the Servicer or Servicer's Assignee, as applicable, shall be entitled
pursuant to Section 3.05 hereof. Without limiting the foregoing, none of the
Trustee or the Certificateholders shall have any right to set off against
Advance Reimbursement Amounts hereunder. An Advance Facility may be terminated
by the joint written direction of the Servicer and the related Advance Financing
Person. Written notice of such termination shall be delivered to the Trustee in
the manner set forth in Section 11.05 hereof. Neither the Depositor nor the
Trustee shall, as a result of the existence of any Advance Facility, have any
additional duty or liability with respect to the calculation or payment of any
Advance Reimbursement Amount, nor, as a result of the existence of any Advance
Facility, shall the Depositor or the Trustee have any additional responsibility
to track or monitor the administration of the Advance Facility or the payment of
Advance Reimbursement Amounts to the Servicer's Assignee. The Servicer shall
indemnify the Depositor, the Trustee, any successor Servicer and the Trust Fund
for any claim, loss, liability or damage resulting from any claim by the related
Advance Financing Person, except to the extent that such claim, loss, liability
or damage resulted from or arose out of negligence, recklessness or willful
misconduct on the part of the Depositor, the Trustee or any successor Servicer,
as the case may be, or failure by the successor Servicer or the Trustee, as the
case may be, to remit funds as required by this Agreement or the commission of
an act or omission to act by the successor Servicer or the Trustee, as the case
may be, and the passage of any applicable cure or grace period, such that a
Servicer Event of Termination under this Agreement occurs or such entity is
subject to termination for cause under this Agreement. The Servicer shall
maintain and provide to any successor Servicer and, upon request, the Trustee a
detailed accounting on a loan-by-loan basis as to amounts advanced by, pledged
or assigned to, and reimbursed to any Advance Financing Person. The successor
Servicer shall be entitled to rely on any such information provided by the
predecessor Servicer, and the successor Servicer shall not be liable for any
errors in such information.
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(d) [Reserved.]
(e) As between a predecessor Servicer and its Advance Financing Person,
on the one hand, and a successor Servicer and its Advance Financing Person, if
any, on the other hand, Advance Reimbursement Amounts on a loan-by-loan basis
with respect to each Mortgage Loan as to which a Advance and/or Servicing
Advance shall have been made and be outstanding shall be allocated on a
"first-in, first out" basis. In the event the Servicer's Assignee shall have
received some or all of an Advance Reimbursement Amount related to Advances
and/or Servicing Advances that were made by a Person other than such predecessor
Servicer or its related Advance Financing Person in error, then such Servicer's
Assignee shall be required to remit any portion of such Advance Reimbursement
Amount to each Person entitled to such portion of such Advance Reimbursement
Amount. Without limiting the generality of the foregoing, the Servicer shall
remain entitled to be reimbursed by the Advance Financing Person for all
Advances and/or Servicing Advances funded by the Servicer to the extent the
related Advance Reimbursement Amounts have not been assigned or pledged to such
Advance Financing Person or Servicer's Assignee.
(f) For purposes of any Officer's Certificate of the Servicer made
pursuant to Section 4.07(d), any Nonrecoverable Advance referred to therein may
have been made by such Servicer or any predecessor Servicer. In making its
determination that any Advance or Servicing Advance theretofore made has become
a Nonrecoverable Advance, the Servicer shall apply the same criteria in making
such determination regardless of whether such Advance or Servicing Advance shall
have been made by the Servicer or any predecessor Servicer.
(g) Any amendment to this Section 3.30 or to any other provision of
this Agreement that may be necessary or appropriate to effect the terms of an
Advance Facility as described generally in this Section 3.30, including
amendments to add provisions relating to a successor Servicer, may be entered
into by the Trustee, the Depositor and the Servicer without the consent of any
Certificateholder, provided such amendment complies with Section 11.01 hereof.
All reasonable costs and expenses (including attorneys' fees) of each party
hereto of any such amendment shall be borne solely by the Servicer. The parties
hereto hereby acknowledge and agree that: (a) the Advances and/or Servicing
Advances financed by and/or pledged to an Advance Financing Person under any
Advance Facility are obligations owed to the Servicer payable only from the cash
flows and proceeds received under this Agreement for reimbursement of Advances
and/or Servicing Advances only to the extent provided herein, and the Trustee
and the Trust are not, as a result of the existence of any Advance Facility,
obligated or liable to repay any Advances and/or Servicing Advances financed by
the Advance Financing Person; (b) the Servicer will be responsible for remitting
to the Advance Financing Person the applicable amounts collected by it as
reimbursement for Advances and/or Servicing Advances funded by the Advance
Financing Person, subject to the provisions of this Agreement; and (c) the
Trustee shall not have any responsibility to track or monitor the administration
of the financing arrangement between the Servicer and any Advance Financing
Person.
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ARTICLE IV
FLOW OF FUNDS
Section 4.01 Interest Distributions.
On each Distribution Date, the Trustee shall withdraw from the
Distribution Account the Interest Remittance Amount and apply it in the
following order of priority (based upon the Mortgage Loan information provided
to it in the Remittance Report, upon which the Trustee may conclusively rely),
the calculations required to be made by the Trustee, to the extent available:
(i) to the Trustee, the Trustee Fee for such Distribution
Date;
(ii) concurrently, as follows:
(A) from the Group I Interest Remittance Amount, to
the Class AV Certificates, the applicable Accrued Certificate
Interest for such Distribution Date; and
(B) from the Group II Interest Remittance Amount to
the Class AF Certificates, pro rata, the applicable Accrued
Certificate Interest for such Distribution Date;
(iii) concurrently, as follows:
(A) from the Group I Interest Remittance Amount, all
applicable Interest Carry Forward Amounts for such
Distribution Date to the Class AV Certificates; and
(B) from the Group II Interest Remittance Amount, pro
rata, all applicable Interest Carry Forward Amounts for such
Distribution Date to the Class AF-1, Class AF-2, Class AF-3
and the Class AF-4 Certificates;
(iv) to the Class M-1 Certificates, the Accrued Certificate
Interest thereon for such Distribution Date;
(v) to the Class M-2 Certificates, the Accrued Certificate
Interest thereon for such Distribution Date;
(vi) to the Class M-3 Certificates, the Accrued Certificate
Interest thereon for such Distribution Date;
(vii) to the Class M-4 Certificates, the Accrued Certificate
Interest thereon for such Distribution Date;
(viii) to the Class M-5 Certificates, the Accrued Certificate
Interest thereon for such Distribution Date;
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(ix) to the Class M-6 Certificates, the Accrued Certificate
Interest thereon for such Distribution Date;
(x) to the Class B-1 Certificates, the Accrued Certificate
Interest thereon for such Distribution Date;
(xi) to the Class B-2 Certificates, the Accrued Certificate
Interest thereon for such Distribution Date;
(xii) to the Class B-3 Certificates, the Accrued Certificate
Interest thereon for such Distribution Date;
(xiii) to the Class B-4 Certificates, the Accrued Certificate
Interest thereon for such Distribution Date;
(xiv) to the Class B-5 Certificates, the Accrued Certificate
Interest thereon for such Distribution Date; and
(xv) the amount, if any, of the Interest Remittance Amount
remaining after application with respect to the priorities set forth
above will be applied as described under Section 4.02(b) hereof.
Section 4.02 Distributions of Principal and Monthly Excess Cashflow
Amounts.
(a) On each Distribution Date, the Trustee shall make the following
distributions in the following order of priority (based upon the Mortgage Loan
information provided to it in the Remittance Report), and the calculations
required to be made by the Trustee, to the extent of the Principal Distribution
Amount:
(i) before the Stepdown Date or with respect to which a
Trigger Event is in effect, sequentially, as follows:
(A) concurrently, as follows:
(1) the Group I Principal Distribution
Amount, to the Class AV Certificates until the
Certificate Principal Balance thereof has been
reduced to zero; and
(2) the Group II Principal Distribution
Amount, concurrently, pro rata, as follows: (a) to
the Class AF-4 Certificates, the Class AF-4 Lockout
Distribution Amount; and (b) sequentially, first to
the Class AF-1 Certificates until the Certificate
Principal Balance thereof has been reduced to zero,
second to the Class AF-2 Certificates until the
Certificate Principal Balance thereof has been
reduced to zero, third to the Class AF-3 Certificates
until the Certificate Principal Balance thereof has
been reduced to zero and fourth to the Class AF-4
Certificates until the Certificate Principal Balance
thereof has been reduced to zero, in that order;
provided, however, that on any Distribution Date on
which the Overcollateralization Amount and the
Certificate Principal Balance of each class of the
Subordinated Certificates have been reduced to zero,
the Group II Principal Distribution Amount will be
distributed, pro rata, to the Class AF-1, Class AF-2,
Class AF-3 and Class AF-4 Certificates, based on the
respective Certificate Principal Balance of each such
class immediately prior to such Distribution Date;
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(B) concurrently, as follows:
(1) the Group I Principal Distribution
Amount remaining after distributions pursuant to
priority (A)(1) above, pro rata, as follows: (a) to
the Class AF-4 Certificates, up to the Class AF-4
Lockout Distribution Amount and (b) sequentially,
first, to the Class AF1 Certificates, until the
Certificate Principal Balance thereof has been
reduced to zero, second, to the Class AF-2
Certificates, until the Certificate Principal Balance
thereof has been reduced to zero, third, to the Class
AF-3 Certificates, until the Certificate Principal
Balance thereof has been reduced to zero, and fourth,
to the Class AF-4 Certificates, until the Certificate
Principal Balance thereof has been reduced to zero,
in that order; provided, however, that on any
Distribution Date on which the Overcollateralization
Amount and the Certificate Principal Balance of each
class of the Subordinated Certificates have been
reduced to zero, the Group I Principal Distribution
Amount will be distributed, pro rata, to the Class
AF-1, Class AF-2, Class AF-3 and Class AF-4
Certificates, based on the respective Certificate
Principal Balance of each such class immediately
prior to such Distribution Date; and
(2) the Group II Principal Distribution
Amount remaining after distributions pursuant to
priority (A)(2) above, to the Class AV Certificates
until the Certificate Principal Balance thereof has
been reduced to zero;
(C) to the Holders of the Class M-1 Certificates,
100% of the remaining Principal Distribution Amount for such
Distribution Date, until the Certificate Principal Balance of
the Class M-1 Certificates has been reduced to zero;
(D) to the Holders of the Class M-2 Certificates,
100% of the remaining Principal Distribution Amount, until the
Certificate Principal Balance of the Class M-2 Certificates
has been reduced to zero;
(E) to the Holders of the Class M-3 Certificates,
100% of the remaining Principal Distribution Amount, until the
Certificate Principal Balance of the Class M-3 Certificates
has been reduced to zero;
(F) to the Holders of the Class M-4 Certificates,
100% of the remaining Principal Distribution Amount, until the
Certificate Principal Balance of the Class M-4 Certificates
has been reduced to zero;
(G) to the Holders of the Class M-5 Certificates,
100% of the remaining Principal Distribution Amount, until the
Certificate Principal Balance of the Class M-5 Certificates
has been reduced to zero;
(H) to the Holders of the Class M-6 Certificates,
100% of the remaining Principal Distribution Amount, until the
Certificate Principal Balance of the Class M-6 Certificates
has been reduced to zero;
(I) to the Holders of the Class B-1 Certificates,
100% of the remaining Principal Distribution Amount, until the
Certificate Principal Balance of the Class B-1 Certificates
has been reduced to zero;
(J) to the Holders of the Class B-2 Certificates,
100% of the remaining Principal Distribution Amount, until the
Certificate Principal Balance of the Class B-2 Certificates
has been reduced to zero
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(K) to the Holders of the Class B-3 Certificates,
100% of the remaining Principal Distribution Amount, until the
Certificate Principal Balance of the Class B-3 Certificates
has been reduced to zero;
(L) to the Holders of the Class B-4 Certificates,
100% of the remaining Principal Distribution Amount, until the
Certificate Principal Balance of the Class B-4 Certificates
has been reduced to zero;
(M) to the Holders of the Class B-5 Certificates,
100% of the remaining Principal Distribution Amount, until the
Certificate Principal Balance of the Class B-5 Certificates
has been reduced to zero; and
(N) any amount of the Principal Distribution Amount
remaining after making all of the distributions in clauses
(A), (B), (C), (D), (E), (F), (G), (H), (I), (J), (K), (L) and
(M) shall be applied as set forth in Section 4.02(b).
(ii) on or after the Stepdown Date and as long as a Trigger
Event is not in effect, sequentially, as follows:
(A) concurrently as follows:
(1) the Group I Principal Distribution
Amount to the Class AV Certificates, until the
Certificate Principal Balance thereof has been
reduced to zero; and
(2) the Group II Principal Distribution
Amount, concurrently, pro rata, as follows (a) to the
Class AF-4 Certificates, the Class AF-4 Lockout
Distribution Amount and (b) sequentially, first, to
the Class AF-1 Certificates, until the Certificate
Principal Balance thereof has been reduced to zero,
second, to the Class AF-2 Certificates, until the
Certificate Principal Balance thereof has been
reduced to zero, third, to the Class AF-3
Certificates, until the Certificate Principal Balance
thereof has been reduced to zero, and fourth, to the
Class AF-4 Certificates, until the Certificate
Principal Balance thereof has been reduced to zero,
in that order; provided, however, that on any
Distribution Date on which the Overcollateralization
Amount and the Certificate Principal Balance of each
class of the Subordinated Certificates have been
reduced to zero, the Group II Principal Distribution
Amount will be distributed, pro rata, to the Class
AF-1, Class AF-2, Class AF-3 and Class AF-4
Certificates, based on the respective Certificate
Principal Balance of each such class immediately
prior to such Distribution Date;
(B) concurrently, as follows:
(1) the Group I Principal Distribution
Amount remaining after distributions pursuant to
priority (A)(1) above, pro rata, as follows: (a) to
the Class AF-4 Certificates, up to the Class AF-4
Lockout Distribution Amount and (b) sequentially,
first to the Class AF-1 Certificates, until the
Certificate Principal Balance thereof has been
reduced to zero, second to the Class AF-2
Certificates, until the Certificate Principal Balance
thereof has been reduced to zero, third to the Class
AF-3 Certificates, until the Certificate Principal
Balance thereof has been reduced to zero, and fourth
to the Class AF-4 Certificates, until the Certificate
Principal Balance thereof has been reduced to zero,
in that order; provided, however, that on any
Distribution Date on which the Overcollateralization
Amount and the Certificate Principal Balance of each
class of the Subordinated Certificates have been
reduced to zero, the Group I Principal Distribution
Amount will be distributed, pro rata, to the Class
AF-1, Class AF-2, Class AF-3 and Class AF-4
Certificates, based on the respective Certificate
Principal Balance of each such class immediately
prior to such Distribution Date; and
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(2) the Group II Principal Distribution
Amount remaining after distributions pursuant to
priority (A)(2) above, to the Class AV Certificates
until the Certificate Principal Balance thereof has
been reduced to zero;
(C) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the sum of the amounts
distributed to the Class A Certificates in clauses (A) and (B)
above and (y) the Class M-1 Principal Distribution Amount will
be distributed to the Class M-1 Certificates, until the
Certificate Principal Balance thereof has been reduced to
zero;
(D) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the sum of the amounts
distributed to the Class A Certificates in clauses (A) and (B)
above and the amount distributed to the Class M-1 Certificates
in clause (C) above and (y) the Class M-2 Principal
Distribution Amount will be distributed to the Class M-2
Certificates, until the Certificate Principal Balance thereof
has been reduced to zero;
(E) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the sum of the amounts
distributed to the Class A Certificates in clauses (A) and (B)
above, the amount distributed to the Class M-1 Certificates in
clause (C) above and the amount distributed to the Class M-2
Certificates in clause (D) above and (y) the Class M-3
Principal Distribution Amount will be distributed to the Class
M-3 Certificates, until the Certificate Principal Balance
thereof has been reduced to zero;
(F) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the sum of the amounts
distributed to the Class A Certificates pursuant to clauses
(A) and (B) above, the amount distributed to the Class M-1
Certificates pursuant to clause (C) above, the amount
distributed to the Class M-2 Certificates pursuant to clause
(D) above and the amount distributed to the Class M-3
Certificates pursuant to clause (E) above and (y) the Class
M-4 Principal Distribution Amount will be distributed to the
Class M-4 Certificates, until the Certificate Principal
Balance thereof has been reduced to zero;
(G) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the sum of the amounts
distributed to the Class A Certificates pursuant to clauses
(A) and (B) above, the amount distributed to the Class M-1
Certificates pursuant to clause (C) above, the amount
distributed to the Class M-2 Certificates pursuant to clause
(D) above, the amount distributed to the Class M-3
Certificates pursuant to clause (E) above and the amount
distributed to the Class M-4 Certificates pursuant to clause
(F) above and (y) the Class M-5 Principal Distribution Amount
will be distributed to the Class M-5 Certificates, until the
Certificate Principal Balance thereof has been reduced to
zero;
(H) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the sum of the amounts
distributed to the Class A Certificates pursuant to clauses
(A) and (B) above, the amount distributed to the Class M-1
Certificates pursuant to clause (C) above, the amount
distributed to the Class M-2 Certificates pursuant to clause
(D) above, the amount distributed to the Class M-3
Certificates pursuant to clause (E) above, the amount
distributed to the Class M-4 Certificates pursuant to clause
(F) above and the amount distributed to the Class M-5
Certificates pursuant to clause (G) above and (y) the Class
M-6 Principal Distribution Amount will be distributed to the
Class M-6 Certificates, until the Certificate Principal
Balance thereof has been reduced to zero;
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(I) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the sum of the amounts
distributed to the Class A Certificates pursuant to clauses
(A) and (B) above, the amount distributed to the Class M-1
Certificates pursuant to clause (C) above, the amount
distributed to the Class M-2 Certificates pursuant to clause
(D) above, the amount distributed to the Class M-3
Certificates pursuant to clause (E) above, the amount
distributed to the Class M-4 Certificates pursuant to clause
(F) above, the amount distributed to the Class M-5
Certificates pursuant to clause (G) above and the amount
distributed to the Class M-6 Certificates pursuant to clause
(H) above and (y) the Class B-1 Principal Distribution Amount
will be distributed to the Class B-1 Certificates, until the
Certificate Principal Balance thereof has been reduced to
zero;
(J) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the sum of the amounts
distributed to the Class A Certificates pursuant to clauses
(A) and (B) above, the amount distributed to the Class M-1
Certificates pursuant to clause (C) above, the amount
distributed to the Class M-2 Certificates pursuant to clause
(D) above, the amount distributed to the Class M-3
Certificates pursuant to clause (E) above, the amount
distributed to the Class M-4 Certificates pursuant to clause
(F) above, the amount distributed to the Class M-5
Certificates pursuant to clause (G) above, the amount
distributed to the Class M-6 Certificates pursuant to clause
(H) above and the amount distributed to the Class B-1
Certificates pursuant to clause (I) above and (y) the Class
B-2 Principal Distribution Amount will be distributed to the
Class B-2 Certificates, until the Certificate Principal
Balance thereof has been reduced to zero;
(K) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the sum of the amounts
distributed to the Class A Certificates pursuant to clauses
(A) and (B) above, the amount distributed to the Class M-1
Certificates pursuant to clause (C) above, the amount
distributed to the Class M-2 Certificates pursuant to clause
(D) above, the amount distributed to the Class M-3
Certificates pursuant to clause (E) above, the amount
distributed to the Class M-4 Certificates pursuant to clause
(F) above, the amount distributed to the Class M-5
Certificates pursuant to clause (G) above, the amount
distributed to the Class M-6 Certificates pursuant to clause
(H) above the amount distributed to the Class B-1 Certificates
pursuant to clause (I) above and the amount distributed to the
Class B-2 Certificates pursuant to clause (J) above and (y)
the Class B-3 Principal Distribution Amount will be
distributed to the Class B-3 Certificates, until the
Certificate Principal Balance thereof has been reduced to
zero;
(L) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the sum of the amounts
distributed to the Class A Certificates pursuant to clauses
(A) and (B) above, the amount distributed to the Class M-1
Certificates pursuant to clause (C) above, the amount
distributed to the Class M-2 Certificates pursuant to clause
(D) above, the amount distributed to the Class M-3
Certificates pursuant to clause (E) above, the amount
distributed to the Class M-4 Certificates pursuant to clause
(F) above, the amount distributed to the Class M-5
Certificates pursuant to clause (G) above, the amount
distributed to the Class M-6 Certificates pursuant to clause
(H) above, the amount distributed to the Class B-1
Certificates pursuant to clause (I) above, the amount
distributed to the Class B-2 Certificates pursuant to clause
(J) above and the amount distributed to the Class B-3
Certificates pursuant to clause (K) above and (y) the Class
B-4 Principal Distribution Amount will be distributed to the
Class B-4 Certificates, until the Certificate Principal
Balance thereof has been reduced to zero;
(M) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the sum of the amounts
distributed to the Class A Certificates pursuant to clauses
(A) and (B) above, the amount distributed to the Class M-1
Certificates pursuant to clause (C) above, the amount
distributed to the Class M-2 Certificates pursuant to clause
(D) above, the amount distributed to the Class M-3
Certificates pursuant to clause (E) above, the amount
distributed to the Class M-4 Certificates pursuant to clause
(F) above, the amount distributed to the Class M-5
Certificates pursuant to clause (G) above, the amount
distributed to the Class M-6 Certificates pursuant to clause
(H) above, the amount distributed to the Class B-1
Certificates pursuant to clause (I) above, the amount
distributed to the Class B-2 Certificates pursuant to clause
(J) above, the amount distributed to the Class B-3
Certificates pursuant to clause (K) above and the amount
distributed to the Class B-4 Certificates pursuant to clause
(L) above and (y) the Class B-5 Principal Distribution Amount
will be distributed to the Class B-5 Certificates, until the
Certificate Principal Balance thereof has been reduced to
zero; and
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(N) any amount of the Principal Distribution Amount
remaining after making all of the distributions in clauses
(A), (B), (C), (D), (E), (F), (G), (H), (I), (J), (K), (L) and
(M) above shall be applied as set forth in Section 4.02(b).
(b) On each Distribution Date, any Monthly Excess Cashflow Amount shall
be distributed, to the extent available, in the following order of priority (the
"Monthly Excess Cashflow Allocation") on such Distribution Date:
(i) to pay any remaining unpaid Accrued Certificate Interest
for such Distribution Date, pro rata, among the Class A Certificates;
(ii) to pay any remaining Interest Carry Forward Amounts for
the classes of Class A Certificates, if any, pro rata, among the Class
A Certificates;
(iii) to pay the Extra Principal Distribution Amount for such
Distribution Date in accordance with Section 4.02(a);
(iv) to pay any remaining unpaid Accrued Certificate Interest
for such Distribution Date for the Class M-1 Certificates;
(v) to pay the remaining Class M-1 Interest Carry Forward
Amount, if any;
(vi) to pay the Class M-1 Realized Loss Amortization Amount
for such Distribution Date;
(vii) to pay any remaining unpaid Accrued Certificate Interest
for such Distribution Date for the Class M-2 Certificates;
(viii) to pay the remaining Class M-2 Interest Carry Forward
Amount, if any;
(ix) to pay the Class M-2 Realized Loss Amortization Amount
for such Distribution Date;
(x) to pay any remaining unpaid Accrued Certificate Interest
for such Distribution Date for the Class M-3 Certificates;
(xi) to pay the remaining Class M-3 Interest Carry Forward
Amount, if any;
(xii) to pay the Class M-3 Realized Loss Amortization Amount
for such Distribution Date;
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(xiii) to pay any remaining unpaid Accrued Certificate
Interest for such Distribution Date for the Class M-4 Certificates;
(xiv) to pay the Interest Carry Forward Amount for the Class
M-4 Certificates, if any;
(xv) to pay the Class M-4 Realized Loss Amortization Amount
for such Distribution Date;
(xvi) to pay any remaining unpaid Accrued Certificate Interest
for such Distribution Date for the Class M-5 Certificates;
(xvii) to pay the Interest Carry Forward Amount for the Class
M-5 Certificates, if any;
(xviii) to pay the Class M-5 Realized Loss Amortization Amount
for such Distribution Date;
(xix) to pay any remaining unpaid Accrued Certificate Interest
for such Distribution Date for the Class M-6 Certificates;
(xx) to pay the Interest Carry Forward Amount for the Class
M-6 Certificates, if any;
(xxi) to pay the Class M-6 Realized Loss Amortization Amount
for such Distribution Date;
(xxii) to pay any remaining unpaid Accrued Certificate
Interest for such Distribution Date for the Class B-1 Certificates;
(xxiii) to pay the remaining Class B-1 Interest Carry Forward
Amount, if any;
(xxiv) to pay the Class B-1 RealizeId Loss Amortization Amount
for such Distribution Date;
(xxv) to pay any remaining unpaid Accrued Certificate Interest
for such Distribution Date for the Class B-2 Certificates;
(xxvi) to pay the remaining Class B-2 Interest Carry Forward
Amount, if any;
(xxvii) to pay the Class B-2 Realized Loss Amortization Amount
for such Distribution Date;
(xxviii) to pay any remaining unpaid Accrued Certificate
Interest for such Distribution Date for the Class B-3 Certificates;
(xxix) to pay the remaining Class B-3 Interest Carry Forward
Amount, if any;
(xxx) to pay the Class B-3 Realized Loss Amortization Amount
for such Distribution Date;
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(xxxi) to pay any remaining unpaid Accrued Certificate
Interest for such Distribution Date for the Class B-4 Certificates;
(xxxii) to pay the remaining Class B-4 Interest Carry Forward
Amount, if any;
(xxxiii) to pay the Class B-4 Realized Loss Amortization
Amount for such Distribution Date;
(xxxiv) to pay any remaining unpaid Accrued Certificate
Interest for such Distribution Date for the Class B-5 Certificates;
(xxxv) to pay the remaining Class B-5 Interest Carry Forward
Amount, if any;
(xxxvi) to pay the Class B-5 Realized Loss Amortization Amount
for such Distribution Date;
(xxxvii) to the Class A Certificates, pro rata, the aggregate
amount of any Net WAC Carryover Amount due to such Certificates;
(xxxviii) 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, Class B-3,
Class B-4 and Class B-5 Certificates, in that order, any Net WAC
Carryover Amount due to such Certificates;
(xxxix) to pay the Class N Certificates, from the remaining
amount distributable on the Class X/N Interest, (A) the Accrued
Certificate Interest for the Class N Certificates, (B) the unpaid
Interest Carry Forward Amount for the Class N Certificates and (C) any
remaining Monthly Excess Cashflow Amount to reduce the Class N Notional
Amount, until the Class N Notional Amount has been reduced to zero; and
(xl) to the Class X Certificates, the Class X Distributable
Amount for such Distribution Date.
On each Distribution Date, there shall be distributed to the Holders of
the Class R Certificates any remaining amount in the Distribution Account on
such date after the application pursuant to Sections 4.01, 4.02(a),
4.02(b)(i)-(xl) and 4.02(c).
(c) On each Distribution Date, all prepayment penalties (including
amounts deposited in connection with the full or partial waiver of such
prepayment penalties pursuant to Section 3.01) shall be allocated to the Class N
Certificates (first as payments of Accrued Certificate Interest for the Class N
Certificates, then as payments in respect of the unpaid Interest Carry Forward
Amount for the Class N Certificates and finally as payments in respect of the
Class N Notional Amount) for so long as the Notional Amount of the Class N
Certificates is greater than zero pursuant to Section 4.02(b)(xxxix) above and
this Section 4.02(c)), and to the Class X Certificates after the Class N
Notional Amount has been reduced to zero.
(d) Any amounts distributed to the Certificates in respect of Net WAC
Carryover Amounts (other than Net WAC Carryover Amounts funded from the Reserve
Account) shall first be deemed distributed by REMIC 2 as a distribution in
respect of the REMIC 2 X/N Interest, to REMIC X/N and distributed thereby as a
distribution to the REMIC X/N Class X/N Interest, and then distributed to the
Certificates from the Grantor Trust as payments on notional principal contracts
in the nature of cap contracts. The Trustee shall account for the rights to
receive Net WAC Carryover Amounts (i) from sources other than the Reserve
Account as rights in a limited recourse interest rate cap contract written by
the Holder of the Class X/N Interest, and (ii) from the Reserve Account as
rights in a limited recourse interest rate cap contract written by the Cap
Contract Counterparty. For federal information reporting purposes, such rights
shall be assigned a value of zero.
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(e) Any amounts distributed to the Class B-2 Certificates pursuant to
Section 4.01 or this Section 4.02, other than Net WAC Carryover Amounts, shall
be deemed distributed by REMIC 2 to REMIC B-2 in respect of the REMIC 2 B-2
Interest, and distributed thereby as a distribution in respect of the REMIC B-2
B-2 Interest. Any amounts distributed to the Class B-3 Certificates pursuant to
Section 4.01 or this Section 4.02, other than Net WAC Carryover Amounts, shall
be deemed distributed by REMIC 2 to REMIC B-3 in respect of the REMIC 2 B-3
Interest, and distributed thereby as a distribution in respect of the REMIC B-3
B-3 Interest. Any amounts distributed to the Class B-4 Certificates pursuant to
Section 4.01 or this Section 4.02, other than Net WAC Carryover Amounts, shall
be deemed distributed by REMIC 2 to REMIC B-4 in respect of the REMIC 2 B-4
Interest, and distributed thereby as a distribution in respect of the REMIC B-4
B-4 Interest. Any amounts distributed to the Class B-5 Certificates pursuant to
Section 4.01 or this Section 4.02, other than Net WAC Carryover Amounts, shall
be deemed distributed by REMIC 2 to REMIC B-5 in respect of the REMIC 2 B-5
Interest, and distributed thereby as a distribution in respect of the REMIC B-5
B-5 Interest.
(f) The Trustee is hereby directed by the Depositor to execute the Cap
Contracts on behalf of the Trust Fund in the form presented to it by the
Depositor and shall have no responsibility for the contents of such Cap
Contracts, including, without limitation, the representations and warranties
contained therein. Any funds payable by the Trustee under the Cap Contracts at
closing shall be paid by the Depositor. Notwithstanding anything to the contrary
contained herein or in the Cap Contracts, the Trustee shall not be required to
make any payments to the Cap Contract Counterparty. Any payments received under
the terms of the Group I Senior Cap Contract will be available to pay the
holders of the Class AV Certificates to the extent that the Class AV
Certificates have not received distributions pursuant to the Monthly Excess
Cashflow Allocation sufficient to fully pay any Net WAC Carryover Amounts due on
the Class AV Certificates for any Distribution Date. Any payments received under
the terms of the Mezzanine Cap Contract will be available to pay the holders of
the Class M Certificates to the extent that the Class M Certificates have not
received distributions pursuant to the Monthly Excess Cashflow Allocation
sufficient to fully pay any Net WAC Carryover Amounts due on each class of the
Class M Certificates for any Distribution Date. The Trustee will make
distributions from amounts in the Reserve Account on the applicable Distribution
Date in the following order of priority:
(i) (a) from the Group I Senior Cap Contract Payments in the Reserve
Account, to the Class AV Certificates any remaining unpaid Net WAC Carryover
Amounts for such class for such Distribution Date (after distributions to the
Class AV Certificates pursuant to clause (xxxvii) of the Monthly Excess Cashflow
Allocation; and
(b) from the Mezzanine Cap Contract Payments in the Reserve
Account, concurrently, to the Class X-0, Xxxxx X-0, Class M-3 and Class
M-4 Certificates from the Reserve Account, pro rata in accordance with
their Certificate Principal Balances immediately prior to such
Distribution Date, any remaining unpaid Net WAC Carryover Amounts for
such classes for such Distribution Date (after distributions to the
Class X-0, Xxxxx X-0, Class M-3 and Class M-4 Certificates pursuant to
clause (xxxviii) of the Monthly Excess Cashflow Allocation);
(ii) from the Mezzanine Cap Contract Payments in the Reserve Account,
concurrently, to the Class X-0, Xxxxx X-0, Class M-3 and Class M-4 Certificates
from the Reserve Account, pro rata in accordance with the remaining unpaid Net
WAC Carryover Amount for such classes for such Distribution Date, any remaining
unpaid Net WAC Carryover Amounts for such classes for such Distribution Date
(after distributions to the Class X-0, Xxxxx X-0, Class M-3 and Class M-4
Certificates pursuant to clause (xxxvii) of the Monthly Excess Cashflow
Allocation and clause (i) above; and
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(iii) to the Cap Contract Counterparty, any remaining amounts on
deposit in the Reserve Account.
(g) The Trustee shall establish and maintain, for the benefit of the
Trust Fund and the Class AV and M Certificateholders, the Reserve Account. On or
prior to the Cap Contract Termination Date, amounts, if any, received by the
Trustee for the benefit of the Trust Fund in respect of the Cap Contracts shall
be deposited by the Trustee into the Reserve Account and will be used to pay Net
WAC Carryover Amounts on the related Class AV and Class M Certificates to the
extent provided in the foregoing paragraphs. With respect to any Distribution
Date on or prior to the Cap Contract Termination Date, the amount, if any,
payable by the Cap Contract Counterparty under each Cap Contract will equal the
product of (i) the excess of (x) LIBOR (as determined by the Cap Contract
Counterparty and subject to a cap equal to the rate with respect to such
Distribution Date as shown under the heading "Cap Rate" in the schedule to the
related Cap Contract), over (y) the rate with respect to such Distribution Date
as shown under the heading "Strike Rate" in the schedule to the related Cap
Contract, (ii) an amount equal to the related Cap Contract Notional Balance and
(iii) the number of days in such Accrual Period, divided by 360.
(h) Amounts on deposit in the Reserve Account will remain uninvested
pending distribution to Certificateholders.
(i) Each of the Cap Contracts is scheduled to remain in effect until
the related Cap Contract Termination Date and will be subject to early
termination only in limited circumstances. Such circumstances include certain
insolvency or bankruptcy events in relation to the Cap Contract Counterparty to
make a payment due under the related Cap Contract, the failure by the Cap
Contract Counterparty (after a cure period of 20 days after notice of such
failure is received) to perform any other agreement made by it under the related
Cap Contract, the termination of the Trust Fund and the related Cap Contract
becoming illegal or subject to certain kinds of taxation.
Section 4.03 Allocation of Losses.
Realized Losses shall be allocated first against any Initial
Overcollateralization Amount remaining and second to the Subsequent
Overcollateralization Amount, until the Overcollateralization Amount has been
reduced to zero. If, after giving effect to the distribution of the Principal
Distribution Amount on any Distribution Date the aggregate Certificate Principal
Balance of the Class A, Class M and Class B Certificates exceeds the Pool
Balance as of the end of the related Collection Period, such excess will be
allocated against the Class B-5, Class B-4, Class B-3, Class B-2, Class B-1,
Class M-6, Class M-5, Class M-4, Class M-3, Class M-2 and Class M-1
Certificates, in that order, until the respective Certificate Principal Balances
thereof are reduced to zero.
Special Hazard Losses will be allocated as described above, provided
that if the cumulative amount of such losses, as of any date of determination,
exceeds the greatest of (i) 1.0% of the Pool Balance as of the Cut-off Date,
(ii) two times the amount of the principal balance of the largest Mortgage Loan
as of the date of determination and (iii) an amount equal to the aggregate
principal balances of the Mortgage Loans in the largest zip-code concentration
in the State of California as of the date of determination, such losses will be
allocated among 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, Class B-3, Class B-4 and Class B-5 Certificates, pro
rata, based on their respective Certificate Principal Balances.
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Section 4.04 Method of Distribution.
The Trustee shall make distributions in respect of a Distribution Date
to each Certificateholder of record on the related Record Date (other than as
provided in Section 10.01 respecting the final distribution), in the case of
Certificateholders of the Certificates, by wire transfer in immediately
available funds to the account of the Person entitled thereto if such Person
shall have so notified the Trustee in writing at least five Business Days prior
to the Record Date immediately prior to such Distribution Date and is the
registered owner of such Certificates the aggregate initial Certificate
Principal Balance or Notional Amount of which is in excess of $5,000,000, or by
check mailed by first class mail to the address of the Person entitled thereto,
as such name and address shall appear on the Certificate Register, provided that
the Trustee may deduct a reasonable wire transfer fee from any payment made by
wire transfer. Distributions among Certificateholders shall be made in
proportion to the Percentage Interests evidenced by the Certificates held by
such Certificateholders.
Section 4.05 Distributions on Book-Entry Certificates.
Each distribution with respect to a Book-Entry Certificate shall be
paid to the Depository, which shall credit the amount of such distribution to
the accounts of its Depository Participants in accordance with its normal
procedures. Each Depository Participant shall be responsible for disbursing such
distribution to the Certificate Owners that it represents and to each indirect
participating brokerage firm (a "brokerage firm" or "indirect participating
firm") for which it acts as agent. Each brokerage firm shall be responsible for
disbursing funds to the Certificate Owners that it represents. All such credits
and disbursements with respect to a Book-Entry Certificate are to be made by the
Depository and the Depository Participants in accordance with the provisions of
the Certificates. None of the Trustee, the Depositor, the Servicer or the
Sponsor shall have any responsibility therefor except as otherwise provided by
applicable law.
Section 4.06 Statements.
(a) On each Distribution Date, based, as applicable, on the Mortgage
Loan information contained in the Remittance Report, the Trustee shall prepare
and post on its website at xxx.xxxxxxxx.xxx/xxx, a statement as to the
distributions made on such Distribution Date:
(i) the amount of the distribution made on such Distribution
Date to the Holders of each Class of Certificates allocable to
principal or reduction of Notional Amount, separately identified;
(ii) the applicable Record Date, accrual date and
Determination Date;
(iii) the amount of the distribution made on such Distribution
Date to the Holders of each Class of Certificates allocable to interest
or Class X Distributable Amount, separately identified;
(iv) the Overcollateralization Amount, the
Overcollateralization Release Amount, the Overcollateralization
Deficiency and the Targeted Overcollateralization Amount as of such
Distribution Date and the Monthly Excess Interest Amount and Monthly
Excess Cashflow Amount for such Distribution Date;
(v) the aggregate amount of servicing compensation received by
the Servicer during the related Collection Period;
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(vi) the aggregate amount of Advances for the related
Collection Period;
(vii) the Pool Balance and the Loan Group Balance for each
Loan Group at the close of business at the end of the related
Collection Period;
(viii) separately stated for each Loan Group, the number,
weighted average remaining term to maturity and weighted average
Mortgage Interest Rate of the Mortgage Loans as of the related Due
Date;
(ix) separately stated for each Loan Group, the number and
aggregate unpaid principal balance of Mortgage Loans (a) 30 to 59 days
Delinquent, (b) 60 to 89 days Delinquent, (c) 90 or more days
Delinquent, (d) as to which foreclosure proceedings have been commenced
and (e) in bankruptcy as of the close of business on the last day of
the calendar month preceding such Distribution Date;
(x) separately stated for each Loan Group, with respect to any
Mortgage Loan that became an REO Property during the preceding calendar
month, the loan number of such Mortgage Loan, the unpaid principal
balance and the Principal Balance of such Mortgage Loan as of the date
it became an REO Property;
(xi) separately stated for each Loan Group, the book value of
any REO Property as of the close of business on the last Business Day
of the calendar month preceding the Distribution Date, and,
cumulatively, the total number and cumulative principal balance of all
REO Properties as of the close of business of the last day of the
preceding Collection Period;
(xii) separately stated for each Loan Group, the aggregate
amount of Principal Prepayments made during the related Prepayment
Period;
(xiii) the aggregate amount of prepayment penalties collected
(including amounts deposited in connection with the full or partial
waiver of such prepayment penalties pursuant to Section 3.01) during
the related Collection Period and the amounts thereof allocable to the
Class N Certificates and the Class X Certificates;
(xiv) separately stated for each Loan Group, the aggregate
amount of Realized Losses incurred during the related Collection Period
and the cumulative amount of Realized Losses;
(xv) separately stated for each Loan Group, any material
modifications, extensions or waivers to the terms, fees, penalties or
payments of the related Mortgage Loans;
(xvi) the Certificate Principal Balance, or Notional Amount,
as applicable, of each Class of Certificates, after giving effect to
the distributions, and allocations of Realized Losses or Applied
Realized Loss Amounts, as applicable, made on such Distribution Date,
separately identifying any reduction thereof due to allocations of
Realized Losses or Applied Realized Loss Amounts;
(xvii) the Accrued Certificate Interest in respect of each
Class of the Class A, Class M and Class B Certificates for such
Distribution Date, separately identifying the portions thereof
attributable to Net WAC Carryover Amounts, and the respective portions
thereof, if any, remaining unpaid following the distributions made in
respect of such Certificates on such Distribution Date;
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(xviii) the aggregate amount of any Prepayment Interest
Shortfalls for such Distribution Date, to the extent not covered by
payments by the Servicer pursuant to Section 3.23;
(xix) any amounts to be deposited in the Reserve Account
pursuant to the Cap Contracts as described in Section 4.02(f) and the
amount thereof to be paid to the Class AV or Class M Certificates;
(xx) the balance of the Reserve Account as of such
Distribution Date;
(xxi) the amount of the Trustee Fee paid;
(xxii) the Net WAC Carryover Amounts distributed on such
Distribution Date;
(xxiii) any Overcollateralization Deficiency after giving
effect to the distribution of principal on such Distribution Date;
(xxiv) whether a Trigger Event has occurred and is continuing,
and the cumulative Realized Losses, as a percentage of the original
Pool Balance;
(xxv) the Available Funds;
(xxvi) the rate at which interest accrues for each Class of
Certificates for such Distribution Date;
(xxvii) the Liquidation Report for such Distribution Date;
(xxviii) the aggregate Principal Balance of Mortgage Loans
purchased by the Servicer or Sponsor during the related Collection
Period and indicating the Section of this Agreement requiring or
allowing the purchase of each such Mortgage Loan; and
(xxix) the aggregate Principal Balance of the Mortgage Loans
repurchased by the Servicer (or an affiliate) during the related
Collection Period in connection with Section 3.16.
Parties that are unable to use xxx.xxxxxxxx.xxx/xxx are entitled to
have a paper copy mailed to them via first class mail by calling the Trustee at
(000) 000-0000 and indicating such. The Trustee shall have the right to change
the way such statements are distributed in order to make such distribution more
convenient and/or more accessible to the above parties and the Trustee shall
provide timely and adequate notification to all above parties regarding any such
changes.
The Trustee may fully rely upon and shall have no liability with
respect to information with respect to the Mortgage Loans provided by the
Servicer.
In the case of information furnished pursuant to subclauses (i) through
(iii) above, the amounts shall be expressed in a separate section of the report
as a dollar amount for each Class for each $1,000 original dollar amount as of
the Cut-off Date.
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(b) Within a reasonable period of time after the end of each calendar
year, the Trustee shall furnish to each Person who at any time during the
calendar year was a Certificateholder of a Regular Certificate, if requested in
writing by such Person, such information as is reasonably necessary to provide
to such Person a statement containing the information set forth in subclauses
(i), (ii), (xv) and (xx) above, aggregated for such calendar year or applicable
portion thereof during which such Person was a Certificateholder. Such
obligation of the Trustee shall be deemed to have been satisfied to the extent
that substantially comparable information shall be prepared and furnished by the
Trustee to Certificateholders pursuant to any requirements of the Code as are in
force from time to time.
(c) On each Distribution Date, the Trustee shall make available to the
Residual Certificateholders a copy of the reports made available to the Regular
Certificateholders in respect of such Distribution Date with such other
information as the Trustee deems necessary or appropriate. Such obligation of
the Trustee shall be deemed to have been satisfied to the extent that
substantially comparable information shall be prepared and furnished to Residual
Certificateholders by the Trustee pursuant to any requirements of the Code as
from time to time in force.
Section 4.07 Remittance Reports; Advances.
(a) On the second Business Day following each Determination Date but in
no event less than four Business Days prior to the related Distribution Date,
the Servicer shall deliver to the Trustee by telecopy (or by such other means as
the Servicer and the Trustee may agree from time to time) a Remittance Report
with respect to the related Distribution Date. On the same date, the Servicer
shall forward to the Trustee by overnight mail a computer readable magnetic tape
or diskette or in such other medium as may be agreed between the Servicer and
the Trustee containing the information set forth in such Remittance Report with
respect to the related Distribution Date. Not later than the close of business
New York time on the Servicer Remittance Date, the Servicer shall deliver or
cause to be delivered to the Trustee in addition to the information provided on
the Remittance Report, such other information reasonably available to it with
respect to the Mortgage Loans as the Trustee may reasonably request or order in
order for the Trustee to perform the calculations necessary to make the
distributions contemplated by Section 4.01, 4.02 and 4.03 and to prepare the
statements to Certificateholders contemplated by Section 4.06. The Trustee shall
not be responsible to recompute, recalculate or verify any information provided
to it by the Servicer.
(b) The amount of Advances to be made by the Servicer for any
Distribution Date shall equal, subject to Section 4.07(d), the sum of (i) the
aggregate amount of Monthly Payments (net of the related Servicing Fee), due
during the related Collection Period in respect of the Mortgage Loans, which
Monthly Payments were delinquent on a contractual basis as of the close of
business on the related Determination Date and (ii) with respect to each REO
Property, which REO Property was acquired during or prior to the related
Prepayment Period and as to which such REO Property an REO Disposition did not
occur during the related Prepayment Period, an amount equal to the excess, if
any, of the interest portion of Monthly Payments (net of the related Servicing
Fee) that would have been due on the related Due Date in respect of the related
Mortgage Loans, over the net income from such REO Property deposited in the
Collection Account pursuant to Section 3.13 for distribution on such
Distribution Date. For purposes of the preceding sentence, the Monthly Payment
on each Balloon Mortgage Loan with a delinquent Balloon Payment is equal to the
assumed monthly payment that would have been due on the related Due Date based
on the original principal amortization schedule for such Balloon Mortgage Loan.
The Servicer shall not be required to make any Advances with respect to the
principal portion of the Monthly Payments that would have been due on the
related Due Date with respect to Second Lien Mortgage Loans and shall not make
any Advances with respect to the principal portion of the Monthly Payments that
would have been due on the related Due Date with respect to REO Properties. The
Servicer will not advance shortfalls in interest collections due to bankruptcy
proceedings or the application of the Relief Act.
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On or before the close of business New York time on the Servicer
Remittance Date, the Servicer shall remit in immediately available funds to the
Trustee for deposit in the Distribution Account an amount equal to the aggregate
amount of Advances, if any, to be made in respect of the Mortgage Loans and REO
Properties for the related Distribution Date either (i) from its own funds or
(ii) from the Collection Account, to the extent of funds held therein for future
distribution (in which case it will cause to be made an appropriate entry in the
records of the Collection Account that amounts held for future distribution have
been, as permitted by this Section 4.07, used by the Servicer in discharge of
any such Advance) or (iii) in the form of any combination of (i) and (ii)
aggregating the total amount of Advances to be made by the Servicer with respect
to the Mortgage Loans and REO Properties. In addition, the Servicer shall have
the right to reimburse itself for any such Advance from amounts held from time
to time in the Collection Account to the extent such amounts are not then
required to be distributed. Any amounts held for future distribution and so used
shall be appropriately reflected in the Servicer's records and replaced by the
Servicer by deposit in the Collection Account on or before any future Servicer
Remittance Date to the extent that the Available Funds for the related
Distribution Date (determined without regard to Advances to be made on the
Servicer Remittance Date) shall be less than the total amount that would be
distributed to the Classes of Certificateholders pursuant to Section 4.01 and
4.02 on such Distribution Date if such amounts held for future distributions had
not been so used to make Advances. The Servicer may reimburse itself from any
amounts in the Collection Account for any prior Advances or Servicing Advances
that have not been reimbursed at the time the Mortgage Loan is modified. The
Trustee will provide notice to the Servicer by telecopy by the close of business
on any Servicer Remittance Date in the event that the amount remitted by the
Servicer to the Trustee on such date is less than the Advances required to be
made by the Servicer for the related Distribution Date, as set forth in the
related Remittance Report.
(c) The obligation of the Servicer to make such Advances is mandatory,
notwithstanding any other provision of this Agreement but subject to (d) below,
and, with respect to any Mortgage Loan or REO Property, shall continue until the
earlier of such time as the Trust acquires title to the related Mortgaged
Property or such Mortgage Loan is paid in full by the Mortgagor or disposed of
by the Trust, or until the recovery of all Liquidation Proceeds thereon.
(d) Notwithstanding anything herein to the contrary, no Advance or
Servicing Advance shall be required to be made hereunder by the Servicer if such
Advance would, if made, constitute a Nonrecoverable Advance. The determination
by the Servicer that it has made a Nonrecoverable Advance or that any proposed
Advance, if made, would constitute a Nonrecoverable Advance, shall be evidenced
by an Officers' Certificate of the Servicer delivered to the Depositor and the
Trustee.
Section 4.08 REMIC Distributions.
(a) REMIC X/N. All amounts deemed distributed in respect of the REMIC 2
X/N Interest shall be treated as received by REMIC X/N then distributed by REMIC
X/N in respect of the REMIC X/N X/N Interest. All allocations of Applied
Realized Loss Amounts and Realized Loss Amortization Amounts to the REMIC 2 X/N
Interest shall result in similar allocations to the REMIC X/N X/N Interest.
(b) REMIC B-5. All amounts deemed distributed in respect of the REMIC 2
B-5 Interest shall be treated as received by REMIC B-5 then distributed by REMIC
B-5 in respect of the REMIC B-5 B-5 Interest. All allocations of Applied
Realized Loss Amounts and Realized Loss Amortization Amounts to the REMIC 2 B-5
Interest shall result in similar allocations to the REMIC B-5 B-5 Interest. If
on any Distribution Date the Certificate Principal Balance of the Class B-5
Certificates is increased pursuant to the last sentence of the definition of
"Certificate Principal Balance", then there shall be an equivalent increase in
the principal amount of the REMIC B-5 B-5 Interest on such Distribution Date.
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(c) REMIC B-4. All amounts deemed distributed in respect of the REMIC 2
B-4 Interest shall be treated as received by REMIC B-4 then distributed by REMIC
B-4 in respect of the REMIC B-4 B-4 Interest. All allocations of Applied
Realized Loss Amounts and Realized Loss Amortization Amounts to the REMIC 2 B-4
Interest shall result in similar allocations to the REMIC B-4 B-4 Interest. If
on any Distribution Date the Certificate Principal Balance of the Class B-4
Certificates is increased pursuant to the last sentence of the definition of
"Certificate Principal Balance", then there shall be an equivalent increase in
the principal amount of the REMIC B-4 B-4 Interest on such Distribution Date.
(d) REMIC B-3. All amounts deemed distributed in respect of the REMIC 2
B-3 Interest shall be treated as received by REMIC B-3 then distributed by REMIC
B-3 in respect of the REMIC B-3 B-3 Interest. All allocations of Applied
Realized Loss Amounts and Realized Loss Amortization Amounts to the REMIC 2 B-3
Interest shall result in similar allocations to the REMIC B-3 B-3 Interest. If
on any Distribution Date the Certificate Principal Balance of the Class B-3
Certificates is increased pursuant to the last sentence of the definition of
"Certificate Principal Balance", then there shall be an equivalent increase in
the principal amount of the REMIC B-3 B-3 Interest on such Distribution Date.
(e) REMIC B-2. All amounts deemed distributed in respect of the REMIC 2
B-2 Interest shall be treated as received by REMIC B-2 then distributed by REMIC
B-2 in respect of the REMIC B-2 B-2 Interest. All allocations of Applied
Realized Loss Amounts and Realized Loss Amortization Amounts to the REMIC 2 B-2
Interest shall result in similar allocations to the REMIC B-2 B-2 Interest. If
on any Distribution Date the Certificate Principal Balance of the Class B-2
Certificates is increased pursuant to the last sentence of the definition of
"Certificate Principal Balance", then there shall be an equivalent increase in
the principal amount of the REMIC B-2 B-2 Interest on such Distribution Date.
(f) REMIC 2. On each Distribution Date, REMIC 2 shall be deemed to have
received the amounts deemed distributed in respect of the REMIC 1 Regular
Interests. Principal, interest, shortfalls and Realized Losses shall be deemed
paid to and allocated among the REMIC 2 Regular Interests in the same manner as
such items (other than payments to the Cap Carryover Certificates in respect of
Net WAC Carryover Amounts, which shall be deemed paid in respect of the REMIC 2
X/N Interest if made from sources other than the Reserve Account) are paid or
allocated in respect of the related Certificates (the REMIC 2 AV Interest being
related to the Class AV Certificates, the REMIC 2 M-1 Interest being related to
the Class M-1 Certificates, the REMIC 2 M-2 Interest being related to the Class
M-2 Certificates, the REMIC 2 M-3 Interest being related to the Class M-3
Certificates, the REMIC 2 M-4 Interest being related to the Class M-4
Certificates, the REMIC 2 M-5 Interest being related to the Class M-5
Certificates, the REMIC 2 M-6 Interest being related to the Class M-6
Certificates, the REMIC 2 B-1 Interest being related to the Class B-1
Certificates, the REMIC 2 B-2 Interest being related to the Class B-2
Certificates, the REMIC 2 B-3 Interest being related to the Class B-3
Certificates, the REMIC 2 B-4 Interest being related to the Class B-4
Certificates and the REMIC 2 B-5 Interest being related to the Class B-5
Certificates). On each Distribution Date, principal shall be paid to, Realized
Losses shall be allocated to and accrued but unpaid interest shall be added to
the principal amount of the REMIC 2 X/N Interest so that such principal amount
shall equal the excess of (i) the Pool Balance as of the close of the related
Collection Period over (ii) the aggregate Certificate Principal Balance of each
Class of Certificates on such Distribution Date after all principal payments
have been made and Realized Losses have been allocated to such Certificates
(other than the Class X or Class N Certificates). The portion of Available Funds
remaining in REMIC 2 on a Distribution Date after all distributions have been
made to the REMIC 2 Regular Interests shall be distributed to the Class R
Certificates in respect of the Class R-2 Interest. If on any Distribution Date
the Certificate Principal Balance of any Class of Certificates is increased
pursuant to the last sentence of the definition of "Certificate Principal
Balance", then there shall be an equivalent increase in the principal amounts of
the REMIC 2 Regular Interests, with each Corresponding REMIC 2 Regular Interest
having an increase in its principal amount equal to the increase in the
Certificate Principal Balance of the Corresponding Cap Carryover Certificates.
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(g) REMIC 1. On each Distribution Date, the REMIC 1 Regular Interests
shall receive distributions of interest and principal equal in the aggregate to
amounts distributable pursuant to Sections 4.01 and 4.02 (other than to the
Class R Certificates pursuant the last sentence of Section 4.02(b) and other
than amounts funded from the Reserve Account) from amounts on deposit in the
Distribution Account. Amounts with respect to interest shall accrue on the REMIC
1 Regular Interests at the rates specified in the Preliminary Statement.
Payments and Realized Losses shall be allocated among the REMIC 1 Regular
Interests so that (i) each of the Marker Interests shall have a principal
balance equal to 25% of the principal balance of the related REMIC 2 Regular
Interest (with, for purposes of this Section 4.08(g), the REMIC 2 AF-1 Interest
being related to the Class LT1-AF1 Interest, the REMIC 2 AF-2 Interest being
related to the Class LT1-AF2 Interest, the REMIC 2 AF-3 Interest being related
to the Class LT1-AF3 Interest, the REMIC 2 AF-4 Interest being related to the
Class LT1-AF4 Interest, the REMIC 2 AV Interest being related to the Class
LT1-AV Interest, the REMIC 2 M-1 Interest being related to the Class LT1-M1
Interest, the REMIC 2 M-2 Interest being related to the Class LT1-M2 Interest,
the REMIC 2 M-3 Interest being related to the Class LT1-M3 Interest, the REMIC 2
M-4 Interest being related to the Class LT1-M4 Interest, the REMIC 2 M-5
Interest being related to the Class LT1-M5 Interest, the REMIC 2 M-6 Interest
being related to the Class LT1-M6 Interest, the REMIC 2 B-1 Interest being
related to the Class LT1-B1 Interest, the REMIC 2 B-2 Interest being related to
the Class LT1-B2 Interest, the REMIC 2 B-3 Interest being related to the Class
LT1-B3 Interest, the REMIC 2 B-4 Interest being related to the Class LT1-B4
Interest and the REMIC 2 B-5 Interest being related to the Class LT1-B5
Interest), (ii) the Class LT1-X1 Interest has a principal balance equal to the
excess of (x) 50% of the remaining principal balance of the Mortgage Loans over
(y) the aggregate principal balance of the Marker Interests (if necessary to
reflect an increase in overcollateralization, accrued and unpaid interest on the
Class LT1-X1 interest may be added to its principal amount to achieve this
result) and (iii) the aggregate principal amount of the Class LT1-IA Interest,
Class LT1-IB Interest, Class LT1-IIA Interest, Class LT1-IIB Interest and the
Class LT1-X2 Interest shall equal 50% of the remaining principal balance of the
Mortgage loans. Distributions and Realized Losses allocated to the REMIC 1
Regular Interests described in clause (iii) of the preceding sentence will be
allocated among such REMIC 1 Regular Interests in the following manner: (x)
distributions shall be deemed made to such REMIC 1 Regular Interests first, so
as to keep the principal balance of the each such REMIC 1 Regular Interest with
"B" at the end of its designation equal to 0.005% of the aggregate scheduled
principal balance of the Mortgage Loans in the related Loan Group; second, to
such REMIC 1 Regular Interests with "A" at the end of its designation so that
the uncertificated principal balance of each such REMIC 1 Regular Interest is
equal to 0.005% of the excess of (I) the aggregate scheduled principal balance
of the Mortgage Loans in the related Loan Group over (II) the aggregate
principal balance of the Class AV Certificates, in the case of Loan Group I, or
the Class AF Certificates, in the case of Loan Group II (except that if 0.005%
of any such excess is greater than the principal amount of the corresponding
REMIC 1 Regular Interest with "A" at the end of its designation, the least
amount of principal shall be distributed to such REMIC 1 Regular Interests with
"A" at the end of its designation such that the REMIC 1 Subordinated Balance
Ratio is maintained) and finally, any remaining distributions of principal to
the Class LT1-X2 Interest and (y) Realized Losses shall be allocated among the
REMIC 1 Regular Interests described in clause (iii) of the preceding sentence in
the following manner: (x) Realized Losses shall be deemed allocated to such
REMIC 1 Regular Interests first, so as to keep the principal balance of the each
such REMIC 1 Regular Interest with "B" at the end of its designation equal to
0.005% of the aggregate scheduled principal balance of the Mortgage Loans in the
related Loan Group; second, to such REMIC 1 Regular Interests with "A" at the
end of its designation so that the uncertificated principal balance of each such
REMIC 1 Regular Interest is equal to 0.005% of the excess of (I) the aggregate
scheduled principal balance of the Mortgage Loans in the related Loan Group over
(II) the aggregate principal balance of the Class AV Certificates, in the case
of Loan Group I, or the Class AF Certificates, in the case of Loan Group II
(except that if 0.005% of any such excess is greater than the principal amount
of the corresponding REMIC 1 Regular Interest with "A" at the end of its
designation, the least amount of Realized Losses shall be allocated to such
REMIC 1 Regular Interests with "A" at the end of its designation such that the
REMIC 1 Subordinated Balance Ratio is maintained) and finally, any remaining
Realized Losses to the Class LT1-X2 Interest. Notwithstanding the preceding two
sentences, however, Realized Losses not allocated to any Class of Certificates
will not be allocated to any REMIC 1 Regular Interests. All computations with
respect to the REMIC 1 Regular Interests shall be taken out to ten decimal
places. Any portion of Available Funds remaining in REMIC 1 on a Distribution
Date after distributions to the REMIC 1 Regular Interests shall be distributed
to the Class R Certificates in respect of the Class R-1 Interest. If on any
Distribution Date the Certificate Principal Balance of any Class of Certificates
is increased pursuant to the last sentence of the definition of "Certificate
Principal Balance", then there shall be an equivalent increase in the principal
amounts of the REMIC 1 Regular Interests, with such increase allocated (before
the making of distributions and the allocation of losses on the REMIC 1 Regular
Interests on such Distribution Date) among the REMIC 1 Regular Interests so
that, to the greatest extent possible, (i) each of the Marker Interests has a
principal balance equal to 25% of the principal balance of the related REMIC 2
Regular Interest, (ii) the Class LT1-X1 Interest has a principal balance equal
to the excess of (x) 50% of the remaining principal balance of the Mortgage
Loans over (y) the aggregate principal balance of the Marker Interests and (iii)
the aggregate principal amount of the Class LT1-IA Interest, Class LT1-IB
Interest, Class LT1-IIA Interest, Class LT1-IIB Interest and Class LT1-X2
Interest shall equal 50% of the remaining principal balance of the Mortgage
Loans. Allocations in connection with clause (iii) shall be made so that, to the
greatest extent possible, (a) the principal balance of each REMIC 1 Regular
Interest with "B" at the end of its designation equals 0.005% of the aggregate
scheduled principal balance of the Mortgage Loans in related Loan Group, (b) the
principal balance of each REMIC 1 Regular Interest with "A" at the end of its
designation equals 0.005% of the excess of (x) the aggregate scheduled principal
balance of the Mortgage Loans in related Loan Group over (y) the aggregate
principal balance of the Class AV Certificates in the case of the Class LT1-IA
Interest, or the Class AF Certificates in the case of the Class LT1-IIA Interest
and (c) any remaining allocations are made to the Class LT1-X2 Interest.
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(h) All prepayment penalties (including amounts deposited in connection
with the full or partial waiver of prepayment penalties pursuant to Section
3.01) shall be distributed from REMIC 1 to REMIC 2 in respect of the Class
LT1-X1 Interest, from REMIC 2 to REMIC X/N in respect of the REMIC 2 X/N
Interest, and from REMIC X/N to the Class X/N Interest in respect of the REMIC
X/N X/N Interest.
(i) Notwithstanding anything to the contrary contained herein, the
above distributions in this Section 4.08 (other than on the Certificates) are
deemed distributions, and distributions of funds from the Distribution Account
shall be made only in accordance with Sections 4.01 and 4.02 hereof.
ARTICLE V
THE CERTIFICATES
Section 5.01 The Certificates.
Each of the Class A, Class M, Class B, Class N, Class X, Class R and
Class R-X Certificates shall be substantially in the forms annexed hereto as
exhibits, and shall, on original issue, be executed by the Trustee and
authenticated and delivered by the Certificate Registrar to or upon the receipt
of a Written Order to Authenticate from the Depositor concurrently with the sale
and assignment to the Trustee of the Trust Fund. Each Class of the Class A,
Class M and Class B Certificates shall be initially evidenced by one or more
Certificates representing a Percentage Interest with a minimum dollar (or
notional amount) denomination of $25,000 and integral multiples of $1 in excess
thereof. The Class N, Class X and Class R Certificates are issuable only in
minimum Percentage Interests of 10%. The Class R-X Certificates are issuable
only in minimum Percentage Interests of 50%.
104
The Certificates shall be executed on behalf of the Trust by manual or
facsimile signature on behalf of the Trustee by a Responsible Officer.
Certificates bearing the manual or facsimile signatures of individuals who were,
at the time when such signatures were affixed, authorized to sign on behalf of
the Trustee shall bind the Trust, notwithstanding that such individuals or any
of them have ceased to be so authorized prior to the authentication and delivery
of such Certificates or did not hold such offices at the date of such
Certificate. No Certificate shall be entitled to any benefit under this
Agreement or be valid for any purpose, unless such Certificate shall have been
manually authenticated by the Certificate Registrar substantially in the form
provided for herein, and such authentication 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. Subject to Section 5.02(c), the Class A, Class M and
Class B Certificates shall be Book-Entry Certificates. The Class N, Class X,
Class R and Class R-X Certificates shall not be Book-Entry Certificates but
shall be issued in fully registered certificate form.
The Class B-2, Class B-3, Class B-4 and Class B-5 Certificates sold in
offshore transactions in reliance on Regulation S shall be issued initially in
the form of one or more permanent global certificates in definitive, fully
registered form without interest coupons with the applicable legends set forth
in Exhibits X-0, X-0, X-0 and B-5 hereto added to the forms of such Certificates
(each, a "Book-Entry Regulation S Global Security"), which shall be deposited on
behalf of the Holders of such Certificates represented thereby with the
Certificate Registrar, as custodian for DTC and registered in the name of a
nominee of DTC, duly executed and authenticated by the Certificate Registrar as
hereinafter provided. The aggregate principal amounts of the Book-Entry
Regulation S Global Securities may from time to time be increased or decreased
by adjustments made on the records of the Certificate Registrar or DTC or its
nominee, as the case may be, as hereinafter provided.
Section 5.02 Registration of Transfer and Exchange of Certificates.
(a) The Certificate Registrar shall cause to be kept at the Corporate
Trust Office of the Trustee a Certificate Register in which, subject to such
reasonable regulations as it may prescribe, the Certificate Registrar shall
provide for the registration of Certificates and of transfers and exchanges of
Certificates as herein provided. The Trustee shall initially serve as
Certificate Registrar for the purpose of registering Certificates and transfers
and exchanges of Certificates as herein provided. The Trustee as Certificate
Registrar shall be subject to the same standards of care, limitations on
liability and rights to indemnity as the Trustee, and the provisions of Sections
8.01, 8.02, 8.03, 8.04, 8.05, 8.14 and 8.15 shall apply to the Certificate
Registrar to the same extent as they apply to the Trustee. Any Certificate
Registrar appointed in accordance with this Section 5.02(a) may at any time
resign by giving at least 30 days' advance written notice of resignation to the
Trustee, the Servicer and the Depositor, such resignation to become effective
upon appointment of a successor Certificate Registrar.
Upon surrender for registration of transfer of any Certificate at any
office or agency of the Certificate Registrar maintained for such purpose
pursuant to the foregoing paragraph and, in the case of a Residual Certificate,
upon satisfaction of the conditions set forth below, the Trustee on behalf of
the Trust shall execute and the Certificate Registrar shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Certificates of the same aggregate Percentage Interest.
105
At the option of the Certificateholders, Certificates may be exchanged
for other Certificates in authorized denominations and the same aggregate
Percentage Interests, upon surrender of the Certificates to be exchanged at any
such office or agency. Whenever any Certificates are so surrendered for
exchange, the Trustee shall execute on behalf of the Trust and the Certificate
Registrar shall authenticate and deliver the Certificates which the
Certificateholder making the exchange is entitled to receive. Every Certificate
presented or surrendered for registration of transfer or exchange shall (if so
required by the Trustee or the Certificate Registrar) be duly endorsed by, or be
accompanied by a written instrument of transfer satisfactory to the Trustee and
the Certificate Registrar duly executed by, the Holder thereof or his attorney
duly authorized in writing.
(b) Upon original issuance, the Book-Entry Certificates shall be issued
in the form of one or more typewritten certificates, to be delivered to the
Depository, the initial Depository, by, or on behalf of, the Depositor; or to,
and deposited with the Certificate Custodian, on behalf of the Depository, if
directed to do so pursuant to instructions from the Depository. Except as
provided in paragraph (c) below, the Book-Entry Certificates shall at all times
remain registered in the name of the Depository or its nominee and at all times:
(i) registration of such Certificates may not be transferred by the Trustee
except to another Depository; (ii) the Depository shall maintain book-entry
records with respect to the Certificate Owners and with respect to ownership and
transfers of such Certificates; (iii) ownership and transfers of registration of
such Certificates on the books of the Depository shall be governed by applicable
rules established by the Depository; (iv) the Depository may collect its usual
and customary fees, charges and expenses from its Depository Participants; (v)
the Trustee shall for all purposes deal with the Depository as representative of
the Certificate Owners of the Certificates for purposes of exercising the rights
of Holders under this Agreement, and requests and directions for and votes of
such representative shall not be deemed to be inconsistent if they are made with
respect to different Certificate Owners; (vi) the Trustee may rely and shall be
fully protected in relying upon information furnished by the Depository with
respect to its Depository Participants and furnished by the Depository
Participants with respect to indirect participating firms and Persons shown on
the books of such indirect participating firms as direct or indirect Certificate
Owners; and (vii) the direct participants of the Depository shall have no rights
under this Agreement under or with respect to any of the Certificates held on
their behalf by the Depository, and the Depository may be treated by the Trustee
and their agents, employees, officers and directors as the absolute owner of the
Certificates for all purposes whatsoever.
All transfers by Certificate Owners of Book-Entry Certificates shall be
made in accordance with the procedures established by the Depository Participant
or brokerage firm representing such Certificate Owners. Each Depository
Participant shall only transfer Book-Entry Certificates of Certificate Owners
that it represents or of brokerage firms for which it acts as agent in
accordance with the Depository's normal procedures. The parties hereto are
hereby authorized to execute a Letter of Representations with the Depository or
take such other action as may be necessary or desirable to register a Book-Entry
Certificate to the Depository. In the event of any conflict between the terms of
any such Letter of Representation and this Agreement, the terms of this
Agreement shall control.
(c) If (i)(x) the Depository or the Depositor advises the Trustee in
writing that the Depository is no longer willing or able to discharge properly
its responsibilities as Depository and (y) the Depositor is unable to locate a
qualified successor, (ii) the Depositor, at its sole option elects to terminate
the book-entry system through the Depository or (iii) after the occurrence of a
Servicer Event of Termination, the Certificate Owners of each Class of
Book-Entry Certificates representing Percentage Interests of such Classes
aggregating not less than 51% advises the Trustee and Depository through the
Financial Intermediaries and the Depository Participants in writing that the
continuation of a book-entry system through the Depository to the exclusion of
definitive, fully registered certificates (the "Definitive Certificates") to
Certificate Owners is no longer in the best interests of the Certificate Owners.
Upon surrender to the Certificate Registrar of the Book-Entry Certificates by
the Depository, accompanied by registration instructions from the Depository for
registration, the Trustee shall, at the Depositor's expense, in the case of (ii)
above, or the Sponsor's expense, in the case of (i) and (iii) above, execute on
behalf of the Trust and the Certificate Registrar shall authenticate the
Definitive Certificates. Neither the Depositor 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, the Trustee, the Certificate Registrar, the Servicer,
any Paying Agent and the Depositor shall recognize the Holders of the Definitive
Certificates as Certificateholders hereunder.
106
(d) No transfer, sale, pledge or other disposition of any Private
Certificate shall be made unless such disposition is exempt from the
registration requirements of the Securities Act of 1933, as amended (the "1933
Act"), and any applicable state securities laws or is made in accordance with
the 1933 Act and laws. In the event of any such transfer, other than the initial
transfer of the Private Certificates by the Depositor, (i) unless such transfer
is made in reliance upon Rule 144A (as evidenced by the investment letter
delivered to the Certificate Registrar, in substantially the form attached
hereto as Exhibit J) under the 1933 Act, the Certificate Registrar and the
Depositor may require a written Opinion of Counsel (which may be in-house
counsel) acceptable to and in form and substance reasonably satisfactory to the
Certificate Registrar and the Depositor that such transfer may be made pursuant
to an exemption, describing the applicable exemption and the basis therefor,
from the 1933 Act or is being made pursuant to the 1933 Act, which Opinion of
Counsel shall not be an expense of the Certificate Registrar, the Trustee or the
Depositor or (ii) the Certificate Registrar shall require the transferor to
execute a transferor certificate (in substantially the form attached hereto as
Exhibit L) and the transferee to execute an investment letter (in substantially
the form attached hereto as Exhibit J) acceptable to and in form and substance
reasonably satisfactory to the Depositor and the Certificate Registrar
certifying to the Depositor and the Certificate Registrar the facts surrounding
such transfer, which investment letter shall not be an expense of the
Certificate Registrar or the Depositor. The Holder of a Private Certificate
desiring to effect such transfer shall, and does hereby agree to, indemnify the
Trustee, the Certificate Registrar and the Depositor against any liability that
may result if the transfer is not so exempt or is not made in accordance with
such federal and state laws.
By acceptance of a Regulation S Global Security, 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 only transfer such a Certificate as provided herein. In
addition, each Holder of a Regulation S Global Security shall be deemed to have
represented and warranted to the Trustee, the Depositor, the Certificate
Registrar and any of their respective successors that: (i) such Person is not a
"U.S. person" within the meaning of Regulation S and was, at the time the buy
order was originated, outside the United States and (ii) such Person understands
that such Certificates have not been registered under the Securities Act and
that (x) until the expiration of the 40-day distribution compliance period
(within the meaning of Regulation S), no offer, sale, pledge or other transfer
of such Certificates or any interest therein shall be made in the United States
or to or for the account or benefit of a U.S. person (each as defined in
Regulation S), (y) if in the future it decides to offer, resell, pledge or
otherwise transfer such Certificates, such Certificates may be offered, resold,
pledged or otherwise transferred only (A) to a person which the seller
reasonably believes is a "qualified institutional buyer" (a "QIB") as defined in
Rule 144A under the Securities Act, that is purchasing such Certificates for its
own account or for the account of a qualified institutional buyer to which
notice is given that the transfer is being made in reliance on Rule 144A or (B)
in an offshore transaction (as defined in Regulation S) in compliance with the
provisions of Regulation S, in each case in compliance with the requirements of
this Agreement; and it will notify such transferee of the transfer restrictions
specified in this Section.
107
The beneficial ownership (as determined for federal income tax
purposes) of a Class N or Class X Certificate shall not be transferred to a
non-United States Person unless (i) such beneficial ownership is transferred to
a non-United States Person who will at all times be a Proportionate Holder and
provides the Certificate Registrar with a representation and covenant to such
effect and (ii) the Certificate Registrar has received, in the manner required
by applicable Treasury regulations (and with all required attachments,
including, where the non-United States Person is providing a Form X-0XXX, Xxxxx
X-0XXX, X-0XXX or W-9 from all persons treated as beneficially owning an
interest in the Class X or Class N Certificate through such non-U.S. Person
either directly, through an intermediary or through another entity that is
treated as a partnership for U.S. federal income tax purposes), a properly
completed Internal Revenue Service Form W-8IMY, Form W-8BEN, Form W-8EXP or Form
W-8ECI from such non-United States Person. No Class N or Class X Certificate may
be pledged or used as collateral for any obligation if it would cause any
portion of the Trust Fund to be treated as a taxable mortgage pool under Section
7701(i) of the Code.
No transfer of an ERISA-Restricted Certificate that is a Class R-X or
Class R Certificate shall be registered unless the Trustee and the Certificate
Registrar shall have received a representation from the transferee of such
Certificate, acceptable to and in form and substance satisfactory to the Trustee
and the Certificate Registrar (such requirement is satisfied only by the
Certificate Registrar's receipt of a representation letter from the transferee
substantially in the form of Exhibit K hereto), to the effect that such
transferee is not an employee benefit plan or arrangement subject to Title I of
ERISA, a plan subject to Section 4975 of the Code or a plan subject to any
state, local, federal, non-U.S. or other law substantively similar to the
foregoing provisions of ERISA or the Code ("Similar Law") (collectively, a
"Plan"), and is not directly or indirectly acquiring the Certificate for, on
behalf of or with any assets of any such Plan.
No transfer of an ERISA-Restricted Certificate (other than a Class R-X
or Class R Certificate) shall be registered unless the Trustee and the
Certificate Registrar shall have received (i) a representation letter from the
transferee of such Certificate substantially in the form of Exhibit I hereto, to
the effect that such transferee is not a Plan and is not directly or indirectly
acquiring the Certificate for, on behalf of or with any assets of any such Plan,
(ii) if the Certificate has been the subject of an ERISA-Qualifying
Underwriting, a representation letter from the transferee substantially in the
form of Exhibit I hereto, that the transferee is an insurance company that is
acquiring the Certificate with assets of an "insurance company general account"
as defined in Section V(e) of Prohibited Transaction Class Exemption ("PTCE")
95-60 and the acquisition and holding of the Certificate are covered and exempt
under Sections I and III of PTCE 95-60, or (iii) solely in the case of a
Definitive Certificate, an Opinion of Counsel satisfactory to the Trustee and
the Certificate Registrar, and upon which the Trustee and the Certificate
Registrar shall be entitled to rely, to the effect that the acquisition and
holding of such Certificate by the transferee will not result in a nonexempt
prohibited transaction under Title I of ERISA or Section 4975 of the Code, or a
violation of Similar Law, and will not subject the Certificate Registrar, the
Depositor, the Servicer or the Trustee to any obligation in addition to those
undertaken by such entities in this Agreement, which opinion of counsel shall
not be an expense of the Certificate Registrar, the Depositor, the Servicer or
the Trustee. The representations in clause (i) or (ii) of the preceding sentence
shall be deemed to have been made to the Certificate Registrar and the Trustee
by the Certificate Owner's acceptance of the beneficial interest in any such
class of ERISA-Restricted Certificates, unless the Trustee and the Certificate
Registrar shall have received from the transferee an alternative representation
acceptable in form and substance to the Trustee and the Certificate Registrar.
Notwithstanding any other provision herein to the contrary, any
purported transfer of an ERISA-Restricted Certificate to or on behalf of a Plan
without the delivery to the Trustee and the Certificate Registrar of a
representation or an Opinion of Counsel satisfactory to the Trustee and the
Certificate Registrar as described above shall be void and of no effect. None of
the Certificate Registrar, the Depositor, the Servicer or the Trustee shall be
under any liability to any Person for any registration or transfer of any
ERISA-Restricted Certificate that is in fact not permitted by this Section
5.02(d) nor shall the Paying Agent be under any liability for making any
payments due on such ERISA-Restricted 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 Certificate Registrar,
Depositor, Servicer, Paying Agent and/or Trustee shall be entitled, but not
obligated, to recover from any holder of any ERISA-Restricted Certificate that
was in fact a Plan and that held such ERISA-Restricted Certificate in violation
of this Section 5.02(d) all payments made on such ERISA-Restricted Certificate
at and after the time it commenced such holding. Any such payments so recovered
shall be paid and delivered to the last preceding holder of such
ERISA-Restricted Certificate that is not a Plan.
108
Each Person who has or who acquires any Ownership Interest in a
Residual Certificate shall be deemed by the acceptance or acquisition of such
Ownership Interest to have agreed to be bound by the following provisions and to
have irrevocably appointed the Depositor or its designee as its attorney-in-fact
to negotiate the terms of any mandatory sale under clause (v) below and to
execute all instruments of transfer and to do all other things necessary in
connection with any such sale, and the rights of each Person acquiring any
Ownership Interest in a Residual Certificate are expressly subject to the
following provisions:
(i) Each Person holding or acquiring any Ownership Interest in a
Residual Certificate shall be a Permitted Transferee and shall promptly notify
the Certificate Registrar of any change or impending change in its status as a
Permitted Transferee.
(ii) No Person shall acquire an Ownership Interest in a Residual
Certificate unless such Ownership Interest is a pro rata undivided interest.
(iii) In connection with any proposed transfer of any Ownership
Interest in a Residual Certificate, the Certificate Registrar shall as a
condition to registration of the transfer, require delivery to it, in form and
substance satisfactory to it, of each of the following:
(A) an affidavit in the form of Exhibit K hereto from the
proposed transferee to the effect that, among other things, such
transferee is a Permitted Transferee and that it is not acquiring its
Ownership Interest in the Residual Certificate that is the subject of
the proposed transfer as a nominee, trustee or agent for any Person who
is not a Permitted Transferee; and
(B) a covenant of the proposed transferee to the effect that
the proposed transferee agrees to be bound by and to abide by the
transfer restrictions applicable to the Residual Certificates.
(iv) Any attempted or purported transfer of any Ownership Interest in a
Residual Certificate in violation of the provisions of this Section shall be
absolutely null and void and shall vest no rights in the purported transferee.
If any purported transferee shall, in violation of the provisions of this
Section, become a Holder of a Residual Certificate, then the prior Holder of
such Residual Certificate that is a Permitted Transferee shall, upon discovery
that the registration of transfer of such Residual Certificate was not in fact
permitted by this Section, be restored to all rights as Holder thereof
retroactive to the date of registration of transfer of such Residual
Certificate. The Certificate Registrar shall be under no liability to any Person
for any registration of transfer of a Residual Certificate that is in fact not
permitted by this Section or for making any distributions due on such Residual
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 Certificate
Registrar received the documents specified in clause (iii). The Trustee shall be
entitled to recover from any Holder of a Residual Certificate that was in fact
not a Permitted Transferee at the time such distributions were made all
distributions made on such Residual Certificate. Any such distributions so
recovered by the Trustee shall be distributed and delivered by the Trustee to
the prior Holder of such Residual Certificate that is a Permitted Transferee.
109
(v) If any Person other than a Permitted Transferee acquires any
Ownership Interest in a Residual Certificate in violation of the restrictions in
this Section, then the Certificate Registrar shall have the right but not the
obligation, without notice to the Holder of such Residual Certificate or any
other Person having an Ownership Interest therein, to notify the Depositor to
arrange for the sale of such Residual Certificate. The proceeds of such sale,
net of commissions (which may include commissions payable to the Depositor or
its affiliates in connection with such sale), expenses and taxes due, if any,
will be remitted by the Trustee to the previous Holder of such Residual
Certificate that is a Permitted Transferee, except that in the event that the
Trustee determines that the Holder of such Residual Certificate may be liable
for any amount due under this Section or any other provisions of this Agreement,
the Trustee may withhold a corresponding amount from such remittance as security
for such claim. The terms and conditions of any sale under this clause (v) shall
be determined in the sole discretion of the Trustee and it shall not be liable
to any Person having an Ownership Interest in a Residual Certificate as a result
of its exercise of such discretion.
(vi) If any Person other than a Permitted Transferee acquires any
Ownership Interest in a Residual Certificate in violation of the restrictions in
this Section, then the Trustee will provide to the Internal Revenue Service, and
to the persons specified in Sections 860E(e)(3) and (6) of the Code, information
needed to compute the tax imposed under Section 860E(e)(5) of the Code on
transfers of residual interests to disqualified organizations. The Trustee shall
be entitled to reasonable compensation for providing such information from the
person to whom it is provided.
The foregoing provisions of this Section shall cease to apply to
transfers occurring on or after the date on which there shall have been
delivered to the Certificate Registrar, in form and substance satisfactory to
the Certificate Registrar, (i) written notification from each Rating Agency that
the removal of the restrictions on Transfer set forth in this Section will not
cause such Rating Agency to downgrade its rating of the Certificates and (ii) an
Opinion of Counsel to the effect that such removal will not cause any REMIC
hereunder to fail to qualify as a REMIC.
(e) No service charge shall be made for any registration of transfer or
exchange of Certificates of any Class, 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 transfer or exchange of Certificates.
All Certificates surrendered for registration of transfer or exchange
shall be cancelled by the Certificate Registrar and disposed of pursuant to its
standard procedures.
Section 5.03 Mutilated, Destroyed, Lost or Stolen Certificates.
If (i) any mutilated Certificate is surrendered to the Certificate
Registrar or the Certificate Registrar receives evidence to its satisfaction of
the destruction, loss or theft of any Certificate and (ii) there is delivered to
the Trustee, the Depositor 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 Trustee or the Certificate Registrar that such
Certificate has been acquired by a bona fide purchaser, the Trustee shall
execute on behalf of the Trust, and the Certificate Registrar 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 Percentage Interest.
Upon the issuance of any new Certificate under this Section, the Trustee 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 and the
Certificate Registrar) in connection therewith. Any duplicate Certificate issued
pursuant to this Section, shall constitute complete and indefeasible evidence of
ownership in the Trust, as if originally issued, whether or not the lost, stolen
or destroyed Certificate shall be found at any time.
110
Section 5.04 Persons Deemed Owners.
The Servicer, the Depositor, the Trustee, the Certificate Registrar,
any Paying Agent and any agent of the Servicer, the Depositor, the Certificate
Registrar, any Paying Agent or the Trustee may treat the Person, including a
Depository, in whose name any Certificate is registered as the owner of such
Certificate for the purpose of receiving distributions pursuant to Section 4.01
and 4.02 and for all other purposes whatsoever, and none of the Servicer, the
Trust, the Trustee, any Paying Agent nor any agent of any of them shall be
affected by notice to the contrary.
Section 5.05 Appointment of Paying Agent.
The Paying Agent shall make distributions to Certificateholders from
the Distribution Account pursuant to Section 4.01 and 4.02 and shall report the
amounts of such distributions to the Trustee. The duties of the Paying Agent may
include the obligation (i) to withdraw funds from the Collection Account
pursuant to Section 3.05 and for the purpose of making the distributions
referred to above and (ii) to distribute statements and provide information to
Certificateholders as required hereunder. The Paying Agent hereunder shall at
all times be an entity duly incorporated and validly existing under the laws of
the United States of America or any state thereof, authorized under such laws to
exercise corporate trust powers and subject to supervision or examination by
federal or state authorities. The Paying Agent shall initially be the Trustee.
The Trustee may appoint a successor to act as Paying Agent, which appointment
shall be reasonably satisfactory to the Depositor and the Rating Agencies. The
Trustee as Paying Agent shall be subject to the same standards of care,
limitations on liability and rights to indemnity as the Trustee, and the
provisions of Sections 8.01, 8.02, 8.03, 8.04, 8.05, 8.14 and 8.15 shall apply
to the Paying Agent to the same extent as they apply to the Trustee. Any Paying
Agent appointed in accordance with this Section 5.05 may at any time resign by
giving at least 30 days' advance written notice of resignation to the Trustee,
the Servicer and the Depositor, such resignation to become effective upon
appointment of a successor Paying Agent.
ARTICLE VI
THE SPONSOR, THE SERVICER AND THE DEPOSITOR
Section 6.01 Liability of the Sponsor, the Servicer and the Depositor.
The Sponsor and the Servicer shall be liable in accordance herewith
only to the extent of the obligations specifically imposed upon and undertaken
by the Sponsor or Servicer, as the case may be, herein. The Depositor shall be
liable in accordance herewith only to the extent of the obligations specifically
imposed upon and undertaken by the Depositor.
Section 6.02 Merger or Consolidation of, or Assumption of the
Obligations of, the Sponsor, the Servicer or the Depositor.
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Any entity into which the Sponsor, the Servicer or the Depositor may be
merged or consolidated, or any entity resulting from any merger, conversion or
consolidation to which the Sponsor, the Servicer or the Depositor shall be a
party, or any corporation succeeding to the business of the Sponsor, the
Servicer or the Depositor, shall be the successor of the Sponsor, the Servicer
or the Depositor, as the case may be, hereunder, without the execution or filing
of any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding; provided, however, that the
successor Servicer shall satisfy all the requirements of Section 7.02 with
respect to the qualifications of a successor Servicer.
Section 6.03 Limitation on Liability of the Servicer and Others.
Neither the Servicer nor any of the directors or officers or employees
or agents of the Servicer shall be under any liability to the Trust or the
Certificateholders for any action taken or for refraining from the taking of any
action by the Servicer in good faith pursuant to this Agreement, or for errors
in judgment; provided, however, that this provision shall not protect the
Servicer or any such Person against any liability which would otherwise be
imposed by reason of its willful misfeasance, bad faith or gross negligence in
the performance of duties of the Servicer or by reason of its reckless disregard
of its obligations and duties of the Servicer hereunder; provided, further, that
this provision shall not be construed to entitle the Servicer to indemnity in
the event that amounts advanced by the Servicer to retire any senior lien exceed
Liquidation Proceeds (in excess of related liquidation expenses) realized with
respect to the related Mortgage Loan. The Servicer and any director or officer
or employee or agent of the 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 Servicer and any director or officer or
employee or agent of the Servicer shall be indemnified by the Trust and held
harmless against any loss, liability or expense incurred in connection with any
legal action relating to this Agreement or the Certificates, other than any
loss, liability or expense incurred by reason of its willful misfeasance, bad
faith or negligence in the performance of duties hereunder or by reason of its
reckless disregard of obligations and duties hereunder. The Servicer may
undertake any such action which it may deem necessary or desirable in respect of
this Agreement, and the rights and duties of the parties hereto and the
interests of the Certificateholders hereunder. In such event, the reasonable
legal expenses and costs of such action and any liability resulting therefrom
shall be expenses, costs and liabilities of the Trust and the Servicer shall be
entitled to pay such expenses from the proceeds of the Trust or to be reimbursed
therefor pursuant to Section 3.05 upon presentation to the Trustee of
documentation of such expenses, costs and liabilities. The Servicer's right to
indemnity or reimbursement pursuant to this Section shall survive any
resignation or termination of the Servicer pursuant to Section 6.04 or 7.01 with
respect to any losses, expenses, costs or liabilities arising prior to such
resignation or termination (or arising from events that occurred prior to such
resignation or termination). This paragraph shall apply to the Servicer solely
in its capacity as Servicer hereunder and in no other capacities.
Section 6.04 Servicer Not to Resign.
Subject to the provisions of Section 7.01 and Section 6.02, the
Servicer shall not resign from the obligations and duties hereby imposed on it
except (i) upon determination that the performance of its obligations or duties
hereunder are no longer permissible under applicable law or are in material
conflict by reason of applicable law with any other activities carried on by it
or its subsidiaries or Affiliates, the other activities of the Servicer so
causing such a conflict being of a type and nature carried on by the Servicer or
its subsidiaries or Affiliates at the date of this Agreement or (ii) upon
satisfaction of the following conditions: (a) either (x) the Servicer has
proposed a successor servicer to the Trustee in writing and such proposed
successor servicer is reasonably acceptable to the Trustee or (y) the Servicing
Rights Pledgee has delivered to the Trustee a letter signed by the Servicer
whereunder the Servicer resigns as Servicer under this Agreement pursuant to the
second paragraph of this Section 6.04 or the second paragraph of Section
7.02(a); and (b) each Rating Agency shall have delivered a letter to the Trustee
prior to the appointment of the successor servicer stating that the proposed
appointment of such successor servicer as Servicer hereunder will not result in
the reduction or withdrawal of the then current rating of the Regular
Certificates; or the ratings that are in effect; provided, however, that no such
resignation by the Servicer shall become effective until such successor servicer
or, in the case of (i) above, the Trustee shall have assumed the Servicer's
responsibilities and obligations hereunder or the Trustee shall have designated
a successor servicer in accordance with the second paragraph of this Section
6.04 or with Section 7.02. Any such resignation shall not relieve the Servicer
of responsibility for any of the obligations specified in Sections 7.01 and 7.02
as obligations that survive the resignation or termination of the Servicer. Any
such determination permitting the resignation of the Servicer pursuant to clause
(i) above shall be evidenced by an Opinion of Counsel to such effect delivered
to the Trustee. Any such determination permitting the resignation of the
Servicer shall be evidenced by an Opinion of Counsel to such effect delivered to
the Trustee.
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The Trustee and the Depositor hereby specifically (i) consent to the
pledge and assignment by the Servicer of all the Servicer's right, title and
interest in, to and under this Agreement to the Servicing Rights Pledgee, for
the benefit of certain lenders, and (ii) provided that no Servicer Event of
Termination exists, agree that upon delivery to the Trustee by the Servicing
Rights Pledgee of a letter signed by the Servicer whereunder the Servicer shall
resign as Servicer under this Agreement, the Trustee shall appoint the Servicing
Rights Pledgee or its designee as successor Servicer, provided that at the time
of such appointment, the Servicing Rights Pledgee or such designee meets the
requirements of a successor Servicer pursuant to Section 7.02(a) and agrees to
be subject to the terms of this Agreement. If, pursuant to any provision hereof,
the duties of the Servicer are transferred to a successor, the entire amount of
the Servicing Fee and other compensation payable to the Servicer pursuant hereto
shall thereafter be payable to such successor.
Section 6.05 Delegation of Duties.
In the ordinary course of business, the Servicer at any time may
delegate any of its duties hereunder to any Person, including any of its
Affiliates, who agrees to conduct such duties in accordance with standards
comparable to those set forth in Section 3.01. Such delegation shall not relieve
the Servicer of its liabilities and responsibilities with respect to such duties
and shall not constitute a resignation within the meaning of Section 6.04. At
any time that reporting under the Exchange Act is required, the Servicer shall
provide the Trustee and the Rating Agencies with 30 days prior written notice
prior to the delegation of any of its duties to any Person other than any of the
Servicer's Affiliates or their respective successors and assigns.
ARTICLE VII
DEFAULT
Section 7.01 Servicer Events of Termination.
(a) If any one of the following events (each, a "Servicer Event of
Termination") shall occur and be continuing:
(i) (A) The failure by the Servicer to make any required Advance; or
(B) any other failure by the Servicer to deposit in the Collection Account or
Distribution Account any deposit required to be made under the terms of this
Agreement 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
Servicer by the Trustee or by any Holder of a Regular Certificate evidencing at
least 25% of the Voting Rights; or
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(ii) The failure by the Servicer to make any required Servicing Advance
which failure continues unremedied for a period of 30 days, or the failure by
the Servicer duly to observe or perform, in any material respect, any other
covenants, obligations or agreements of the Servicer as set forth in this
Agreement, which failure continues unremedied for a period of 30 days, after the
date (A) on which written notice of such failure, requiring the same to be
remedied, shall have been given to the Servicer by the Trustee or by any Holder
of a Regular Certificate evidencing at least 25% of the Voting Rights or (B)
actual knowledge of such failure by a Servicing Officer of the Servicer; or
(iii) The entry against the Servicer of a decree or order by a court or
agency or supervisory authority having jurisdiction in the premises for the
appointment of a trustee, conservator, receiver or liquidator in any insolvency,
conservatorship, receivership, readjustment of debt, marshalling of assets and
liabilities or similar proceedings, or for the winding up or liquidation of its
affairs, and the continuance of any such decree or order unstayed and in effect
for a period of 60 days; or
(iv) The Servicer shall voluntarily go into liquidation, consent to the
appointment of a conservator or receiver or liquidator or similar person in any
insolvency, readjustment of debt, marshalling of assets and liabilities or
similar proceedings of or relating to the Servicer or of or relating to all or
substantially all of its property; or a decree or order of a court or agency or
supervisory authority having jurisdiction in the premises for the appointment of
a conservator, receiver, liquidator or similar person 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 Servicer and such decree or order shall have remained
in force undischarged, unbonded or unstayed for a period of 60 days; or the
Servicer shall admit in writing its inability to pay its debts generally as they
become due, file a petition to take advantage of any applicable insolvency or
reorganization statute, make an assignment for the benefit of its creditors or
voluntarily suspend payment of its obligations; or
(v) The aggregate amount of cumulative Realized Losses incurred since
the Cut-off Date through the last day of the related Collection Period divided
by the Pool Balance as of the Cut-off Date exceeds the applicable percentages
set forth below with respect to such Distribution Date:
DISTRIBUTION DATE OCCURRING IN PERCENTAGE
------------------------------ ----------
February 2009 through January 2010 4.00%
February 2010 through January 2011 6.25%
February 2011 through January 2012 8.00%
February 2012 and thereafter 9.00%
(b) Then, and in each and every such case, so long as a Servicer Event
of Termination shall not have been remedied within the applicable grace period,
(x) with respect solely to clause (i)(A) above, if such Advance is not made by
2:00 P.M., New York time, on the Business Day immediately following the Servicer
Remittance Date, the Trustee may terminate all of the rights and obligations of
the Servicer under this Agreement and the Trustee, or a successor servicer
appointed in accordance with Section 7.02, shall immediately make such Advance
and assume, pursuant to Section 7.02, the duties of a successor Servicer and (y)
in the case of (i)(B), (ii), (iii), (iv) and (v) above, the Trustee shall, at
the direction of the Holders of each Class of Regular Certificates evidencing
Percentage Interests aggregating not less than 51%, by notice then given in
writing to the Servicer (and to the Trustee if given by Holders of
Certificates), terminate all of the rights and obligations of the Servicer as
servicer under this Agreement. Any such notice to the Servicer shall also be
given to each Rating Agency, the Depositor and the Sponsor. On or after the
receipt by the Servicer (and by the Trustee if such notice is given by the
Holders) of such written notice, all authority and power of the Servicer under
this Agreement, whether with respect to the Certificates or the Mortgage Loans
or otherwise, shall pass to and be vested in the Trustee pursuant to and under
this Section; and, without limitation, the Trustee is hereby authorized and
empowered to execute and deliver, on behalf of the 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 of each Mortgage Loan and Related Documents or otherwise. The
Servicer agrees to cooperate with the Trustee (or the applicable successor
Servicer) in effecting the termination of the responsibilities and rights of the
Servicer hereunder, including, without limitation, the delivery to the Trustee
of all documents and records requested by it to enable it to assume the
Servicer's functions under this Agreement within ten Business Days subsequent to
such notice, the transfer within one Business Day subsequent to such notice to
the Trustee (or the applicable successor Servicer) for the administration by it
of all cash amounts that shall at the time be held by the Servicer and to be
deposited by it in the Collection Account, the Distribution Account, any REO
Account or any Escrow Account or that have been deposited by the Servicer in
such accounts or thereafter received by the Servicer with respect to the
Mortgage Loans or any REO Property received by the Servicer. All reasonable
costs and expenses (including attorneys' fees) incurred in connection with
transferring the servicing to the successor Servicer and amending this Agreement
to reflect such succession as Servicer pursuant to this Section shall be paid by
the predecessor Servicer (or if the predecessor Servicer is the Trustee, the
initial Servicer) upon presentation of reasonable documentation of such costs
and expenses.
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Section 7.02 Trustee to Act; Appointment of Successor.
(a) Within 90 days of the time the Servicer (and the Trustee, if notice
is sent by the Holders) receives a notice of termination pursuant to Section
7.01 or 6.04, the Trustee (or such other successor Servicer as is approved in
accordance with this Agreement) shall be the successor in all respects to the
Servicer in its capacity as servicer under this Agreement and the transactions
set forth or provided for herein and shall be subject to all the
responsibilities, duties and liabilities relating thereto placed on the Servicer
by the terms and provisions hereof arising on and after its succession. As
compensation therefor, the Trustee (or such other successor Servicer) shall be
entitled to such compensation as the Servicer would have been entitled to
hereunder if no such notice of termination had been given. Notwithstanding the
above, (i) if the Trustee is unwilling to act as successor Servicer or (ii) if
the Trustee is legally unable so to act, the Trustee shall appoint or petition a
court of competent jurisdiction to appoint, any established housing and home
finance institution, bank or other mortgage loan or home equity loan servicer
having a net worth of not less than $50,000,000 as the successor to the Servicer
hereunder in the assumption of all or any part of the responsibilities, duties
or liabilities of the Servicer hereunder; provided, that the appointment of any
such successor Servicer will not result in the qualification, reduction or
withdrawal of the ratings assigned to the Certificates or the ratings that are
in effect by the Rating Agencies as evidenced by a letter to such effect from
the Rating Agencies. Pending appointment of a successor to the Servicer
hereunder, unless the Trustee is prohibited by law from so acting, the Trustee
shall act in such capacity as hereinabove provided. In connection with such
appointment and assumption, the successor shall be entitled to receive
compensation out of payments on Mortgage Loans in an amount equal to the
compensation which the Servicer would otherwise have received pursuant to
Section 3.18 (or such other compensation as the Trustee and such successor shall
agree, not to exceed the Servicing Fee). The successor servicer shall be
entitled to withdraw from the Collection Account all costs and expenses
associated with the transfer of the servicing to the successor servicer. The
appointment of a successor servicer shall not affect any liability of the
predecessor Servicer which may have arisen under this Agreement prior to its
termination as Servicer to pay any deductible under an insurance policy pursuant
to Section 3.12 or to indemnify the parties indicated in Section 3.26 pursuant
to the terms thereof, nor shall any successor Servicer be liable for any acts or
omissions of the predecessor Servicer or for any breach by such Servicer of any
of its representations or warranties contained herein or in any related document
or agreement. The Trustee and such successor shall take such action, consistent
with this Agreement, as shall be necessary to effectuate any such succession.
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In the event of a Servicer Event of Termination, notwithstanding
anything to the contrary above, the Trustee and the Depositor hereby agree that
upon delivery to the Trustee by the Servicing Rights Pledgee of a letter signed
by the Servicer within ten Business Days of when notification of such event
shall have been provided to the Trustee, whereunder the Servicer shall resign as
Servicer under this Agreement, the Servicing Rights Pledgee or its designee
shall be appointed as successor Servicer (provided that at the time of such
appointment the Servicing Rights Pledgee or such designee meets the requirements
of a successor Servicer set forth above) and the Servicing Rights Pledgee agrees
to be subject to the terms of this Agreement.
(b) Any successor, including the Trustee, to the Servicer as servicer
shall during the term of its service as servicer continue to service and
administer the Mortgage Loans for the benefit of Certificateholders, and
maintain in force a policy or policies of insurance covering errors and
omissions in the performance of its obligations as Servicer hereunder and a
Fidelity Bond in respect of its officers, employees and agents to the same
extent as the Servicer is so required pursuant to Section 3.12.
Section 7.03 Waiver of Defaults.
The Holders of Certificates entitled to at least 66 2/3% of the Voting
Rights allocated to the Class of Certificates affected by a Servicer Event of
Termination may, on behalf of all Certificateholders, waive any events
permitting removal of the Servicer as servicer pursuant to this Article VII,
provided, however, that such Holders may not waive a default in making a
required distribution on a Certificate without the consent of the Holder of such
Certificate. Upon any waiver of a past default, such default shall cease to
exist and any Servicer Event of Termination 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 thereto
except to the extent expressly so waived. Notice of any such waiver shall be
given by the Trustee to the Rating Agencies.
Section 7.04 Notification to Certificateholders.
(a) On any termination or appointment of a successor the Servicer
pursuant to this Article VII or Section 6.04, the Trustee shall give prompt
written notice thereof to the Certificateholders at their respective addresses
appearing in the Certificate Register and each Rating Agency.
(b) No later than 60 days after the occurrence of any event which
constitutes or which, with notice or a lapse of time or both, would constitute a
Servicer Event of Termination for five Business Days after a Responsible Officer
of the Trustee becomes aware of the occurrence of such an event, the Trustee
shall transmit by mail to all Certificateholders notice of such occurrence
unless such default or Servicer Event of Termination shall have been waived or
cured. Such notice shall be given to the Rating Agencies promptly after any such
occurrence.
Section 7.05 Survivability of Servicer Liabilities.
Notwithstanding anything herein to the contrary, upon termination of
the Servicer hereunder, any liabilities of the Servicer which accrued prior to
such termination shall survive such termination.
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ARTICLE VIII
THE TRUSTEE
Section 8.01 Duties of Trustee.
The Trustee, prior to the occurrence of a Servicer Event of Termination
of which a Responsible Officer of the Trustee shall have actual knowledge and
after the curing of all Servicer Events of Termination which may have occurred,
undertakes to perform such duties and only such duties as are specifically set
forth in this Agreement. If a Servicer Event of Termination has occurred (which
has not been cured) of which a Responsible Officer has actual knowledge, the
Trustee shall exercise such of the rights and powers vested in it by this
Agreement, and use the same degree of care and skill in their exercise, as a
prudent person would exercise or use under the circumstances in the conduct of
such person's own affairs.
The Trustee, upon receipt of all resolutions, certificates, statements,
opinions, reports, documents, orders or other instruments furnished to the
Trustee which are specifically required to be furnished pursuant to any
provision of this Agreement, shall examine them to determine whether they
conform on their face to the requirements of this Agreement to the extent
specified herein; provided, however, that that the Trustee shall not be
responsible for the accuracy or content of any resolution, certificate,
statement, opinion, report, document, order or other instrument furnished by the
Servicer, the Sponsor or the Depositor hereunder. If any such instrument is
found not to conform in any material respect to the requirements of this
Agreement, the Trustee shall notify the Certificateholders of such instrument in
the event that the Trustee, after so requesting, does not receive a
satisfactorily corrected instrument.
No provision of this Agreement shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own misconduct; provided, however, that:
(i) prior to the occurrence of a Servicer Event of Termination, and
after the curing of all such Servicer Events of Termination which may have
occurred, the duties and obligations of the Trustee shall be determined solely
by the express provisions of this Agreement, the Trustee shall not be liable
except for the performance of such duties and obligations as are specifically
set forth in this Agreement, no implied covenants or obligations shall be read
into this Agreement against the Trustee and, in the absence of bad faith on the
part of the Trustee, the Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein, upon any
certificates or opinions furnished to the Trustee and conforming on their face
to the requirements of this Agreement to the extent specified herein;
(ii) the Trustee shall not be liable for an error of judgment made in
good faith by a Responsible Officer of the Trustee unless it shall be proved
that the Trustee was negligent in ascertaining or investigating the facts
related thereto;
(iii) the Trustee shall not be liable with respect to any action taken,
suffered or omitted to be taken by it in good faith in accordance with the
direction of the Majority Certificateholders relating to the time, method and
place of conducting any proceeding for any remedy available to the Trustee or
exercising or omitting to exercise any trust or power conferred upon the Trustee
under this Agreement; and
(iv) the Trustee shall not be charged with knowledge of any failure by
the Servicer to comply with the obligations of the Servicer referred to in
clauses (i) and (ii) of Section 7.01(a) or any Servicer Event of Termination
unless a Responsible Officer of the Trustee at the applicable Corporate Trust
Office obtains actual knowledge of such failure or the Trustee receives written
notice of such failure from the Servicer or the Majority Certificateholders. In
the absence of such receipt of such notice, the Trustee may conclusively assume
that there is no Servicer Event of Termination.
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The Trustee shall not be required to expend or risk its own funds or
otherwise incur financial liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers, if there is
reasonable ground for believing that the repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it, and
none of the provisions contained in this Agreement shall in any event require
the Trustee to perform, or be responsible for the manner of performance of, any
of the obligations of the Servicer under this Agreement, except during such
time, if any, as the Trustee shall be the successor to, and be vested with the
rights, duties, powers and privileges of, the Servicer in accordance with the
terms of this Agreement; provided, however, the Trustee shall not seek
reimbursement or repayment of any of its expenses from the Trust Fund except in
connection with expenses that would constitute "unanticipated expenses" under
Treasury Regulation 1.860G-1(b)(3)(ii).
The Trustee shall not 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 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 or (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.
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 Servicer upon receipt any such complaint,
claim, demand, notice or other document (i) which is delivered to the Trustee at
its Corporate Trust Office; (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 to
is a Mortgaged Property.
Section 8.02 Certain Matters Affecting the Trustee.
(a) Except as otherwise provided in Section 8.01:
(i) the Trustee may request and rely upon, and shall be
protected in acting or refraining from acting upon, any resolution,
Officer's Certificate, certificate of auditors or any other
certificate, statement, instrument, opinion, report, notice, request,
consent, order, appraisal, bond or other paper or document reasonably
believed by it to be genuine and to have been signed or presented by
the proper party or parties;
(ii) the Trustee may consult with counsel and any advice 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) the Trustee shall not be under any obligation to
exercise any of the rights or powers vested in it by this Agreement, or
to institute, conduct or defend any litigation hereunder or in relation
hereto, at the request, order or direction of the Certificateholders
pursuant to the provisions of this Agreement, unless such
Certificateholders shall have offered to the Trustee reasonable
security or indemnity against the costs, expenses and liabilities which
may be incurred therein or thereby; the right of the Trustee to perform
any discretionary act enumerated in this Agreement shall not be
construed as a duty, and the Trustee shall not be answerable for other
than its negligence or willful misconduct in the performance of any
such act;
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(iv) the Trustee shall not be liable for any action taken,
suffered or omitted by it in good faith and believed by it to be
authorized or within the discretion or rights or powers conferred upon
it by this Agreement;
(v) prior to the occurrence of a Servicer Event of Termination
and after the curing of all Servicer Events of Termination which may
have occurred, the Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent,
order, approval, bond or other paper or documents, unless requested in
writing to do so by the Majority Certificateholder; provided, however,
that if the payment within a reasonable time to the Trustee of the
costs, expenses or liabilities likely to be incurred by it in the
making of such investigation is, in the opinion of the Trustee not
reasonably assured to the Trustee by the security afforded to it by the
terms of this Agreement, the Trustee may require reasonable indemnity
against such cost, expense or liability as a condition to such
proceeding. The reasonable expense of every such examination shall be
paid by the Servicer or, if paid by the Trustee shall be reimbursed by
the Servicer upon demand. Nothing in this clause (v) shall derogate
from the obligation of the Servicer to observe any applicable law
prohibiting disclosure of information regarding the Mortgagors;
(vi) the Trustee shall not be accountable, shall have any
liability or make any representation as to any acts or omissions
hereunder of the Servicer until such time as the Trustee may be
required to act as Servicer pursuant to Section 7.02;
(vii) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents or attorneys or a custodian and the Trustee shall not be
responsible for any misconduct or negligence on the part of any such
agent, attorney or custodian appointed by it with due care; and
(viii) the right of the Trustee to perform any discretionary
act enumerated in this Agreement shall not be construed as a duty, and
the Trustee shall not be answerable for other than its negligence or
willful misconduct in the performance of such act.
Section 8.03 Trustee Not Liable for Certificates or Mortgage Loans.
The recitals contained herein and in the Certificates (other than the
authentication of the Trustee on the Certificates) shall be taken as the
statements of the Sponsor, and the Trustee does not assume any responsibility
for the correctness of the same. The Trustee makes no representations as to the
validity or sufficiency of this Agreement or of the Certificates (other than the
signature and authentication of the Trustee on the Certificates) or of any
Mortgage Loan or Related Document. The Trustee shall not be accountable for the
use or application by the Servicer, or for the use or application of any funds
paid to the Servicer in respect of the Mortgage Loans or deposited in or
withdrawn from the Collection Account by the Servicer. The Trustee shall not at
any time have any responsibility or liability for or with respect to the
legality, validity and enforceability of any Mortgage or any Mortgage Loan, or
the perfection and priority of any Mortgage or the maintenance of any such
perfection and priority, or for or with respect to the sufficiency of the Trust
or its ability to generate the payments to be distributed to Certificateholders
under this Agreement, including, without limitation: the existence, condition
and ownership of any Mortgaged Property; the existence and enforceability of any
hazard insurance thereon (other than if the Trustee shall assume the duties of
the Servicer pursuant to Section 7.02); the validity of the assignment of any
Mortgage Loan to the Trustee or of any intervening assignment; the completeness
of any Mortgage Loan; the performance or enforcement of any Mortgage Loan (other
than if the Trustee shall assume the duties of the Servicer pursuant to Section
7.02); the compliance by the Depositor, the Sponsor or the Servicer with any
warranty or representation made under this Agreement or in any related document
or the accuracy of any such warranty or representation prior to the Trustee's
receipt of notice or other discovery of any non-compliance therewith or any
breach thereof; any investment of monies by or at the direction of the Servicer
or any loss resulting therefrom; the acts or omissions of any of the Servicer
(other than if the Trustee shall assume the duties of the Servicer pursuant to
Section 7.02), or any Mortgagor; any action of the Servicer (other than if the
Trustee shall assume the duties of the Servicer pursuant to Section 7.02), taken
in the name of the Trustee; the failure of the Servicer to act or perform any
duties required of it as agent of the Trustee hereunder; or any action by the
Trustee taken at the instruction of the Servicer (other than if the Trustee
shall assume the duties of the Servicer pursuant to Section 7.02); provided,
however, that the foregoing shall not relieve the Trustee of its obligation to
perform its duties under this Agreement. The Trustee shall not 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.
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Section 8.04 Trustee May Own Certificates.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Certificates with the same rights as it would have if it
were not Trustee and may transact any banking and trust business with the
Sponsor, the Servicer, the Depositor or their Affiliates.
Section 8.05 Sponsor to Pay Trustee Fees and Expenses.
The Trustee shall withdraw from the Distribution Account on each
Distribution Date and pay to itself the Trustee Fee pursuant to Section 4.01(i)
and, to the extent the Interest Remittance Amount is at any time insufficient
for such purpose, the Sponsor shall pay such fees as reasonable compensation
(which shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust) for all services rendered by it
in the execution of the trusts hereby created and in the exercise and
performance of any of the powers and duties hereunder of the Trustee, and the
Sponsor will pay or reimburse the Trustee upon its request for all reasonable
expenses, disbursements and advances incurred or made by the Trustee in
accordance with any of the provisions of this Agreement (including the
reasonable compensation and the expenses and disbursements of its counsel and of
all persons not regularly in its employ) except any such expense, disbursement
or advance as may arise from such party's negligence or bad faith or which is
the responsibility of Certificateholders, the Trustee hereunder. Notwithstanding
any other provision of this Agreement, including Section 2.03(a) and Section
2.04, to the contrary, the Sponsor covenants and agrees to indemnify the Trustee
and its officers, directors, employees and agents from, and hold each of them
harmless against, any and all losses, liabilities, damages, claims or expenses
incurred in connection with (a) any legal action relating to this Agreement, the
Custodial Agreement, the Certificates or incurred in connection with the
administration of the Trust, other than with respect to a party, any loss,
liability or expense incurred by reason of willful misfeasance, bad faith or
negligence of such party in the performance of its duties hereunder or by reason
of such party's reckless disregard of obligations and duties hereunder and (b)
the second paragraph of Section 2.01. Anything in this Agreement to the contrary
notwithstanding, in no event shall the Trustee be liable for special, indirect
or consequential loss or damage of any kind whatsoever (including but not
limited to lost profits), even if the Trustee has been advised of the likelihood
of such loss or damage and regardless of the form of action. The Trustee and any
director, officer, employee or agent of the Trustee shall be indemnified, to the
extent not paid by the Sponsor pursuant to this Section, by the Trust Fund and
held harmless against any loss, liability or expense (not including expenses,
disbursements and advances incurred or made by the Trustee, in the ordinary
course of the Trustee's performance in accordance with the provisions of this
Agreement) incurred by the Trustee or such party arising out of or in connection
with the acceptance or administration of its duties under this Agreement, other
than in connection with the indemnification provided pursuant to clause (a)
above, any loss, liability or expense incurred by reason of willful misfeasance,
bad faith or negligence in the performance by the Trustee of its duties under
this Agreement or by reason of the reckless disregard of the Trustee's
obligations and duties under this Agreement. This section shall survive
termination of this Agreement or the resignation or removal of any Trustee
hereunder.
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Section 8.06 Eligibility Requirements for Trustee.
The Trustee hereunder shall at all times be a Department of Housing and
Urban Development and Federal Housing Administration approved mortgagee, an
entity duly organized and validly existing under the laws of 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 and a minimum long-term debt rating of BBB by Fitch and S&P and a
long term debt rating of at least A1 or better by Xxxxx'x, and subject to
supervision or examination by federal or state authority. If such entity
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 8.06, the combined capital and surplus of such entity
shall be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published. The principal office of the Trustee
(other than the initial Trustee) shall be in a state with respect to which an
Opinion of Counsel has been delivered to such Trustee at the time such Trustee
is appointed Trustee to the effect that the Trust will not be a taxable entity
under the laws of such state. In case at any time the Trustee shall cease to be
eligible in accordance with the provisions of this Section 8.06, the Trustee
shall resign immediately in the manner and with the effect specified in Section
8.07.
Section 8.07 Resignation or Removal of Trustee.
The Trustee may at any time resign and be discharged from the trusts
hereby created by giving written notice thereof to the Depositor, the Servicer
and each Rating Agency. Upon receiving such notice of resignation, the Depositor
shall promptly appoint a successor Trustee, by written instrument, in duplicate,
one copy of which instrument shall be delivered to the resigning Trustee and one
copy to the successor Trustee. If no successor Trustee shall have been so
appointed and having accepted appointment within 30 days after the giving of
such notice of resignation, the resigning Trustee may petition any court of
competent jurisdiction for the appointment of a successor Trustee.
If at any time the Trustee shall cease to be eligible in accordance
with the provisions of Section 8.06 and shall fail to resign after written
request therefor by the Depositor, or if at any time the Trustee shall be
legally unable to act, or shall be adjudged a bankrupt or insolvent, or a
receiver of the Trustee or of its property shall be appointed, or any public
officer shall take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or liquidation, then the
Depositor may remove the Trustee. If the Depositor or the Servicer removes the
Trustee under the authority of the immediately preceding sentence, the Depositor
shall promptly appoint a successor Trustee by written instrument, in duplicate,
one copy of which instrument shall be delivered to the Trustee so removed and
one copy to the successor Trustee.
The Majority Certificateholders may at any time remove the Trustee by
written instrument or instruments delivered to the Servicer, the Depositor and
the Trustee; the Depositor shall thereupon use its best efforts to appoint a
successor Trustee in accordance with this Section.
Any resignation or removal of the Trustee and appointment of a
successor Trustee pursuant to any of the provisions of this Section 8.07 shall
not become effective until acceptance of appointment by the successor Trustee as
provided in Section 8.08.
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Section 8.08 Successor Trustee.
Any successor Trustee appointed as provided in Section 8.07 shall
execute, acknowledge and deliver to the Depositor, the Rating Agencies, the
Servicer and to its predecessor Trustee an instrument accepting such appointment
hereunder, and thereupon the resignation or removal of the predecessor Trustee
shall become effective, and such successor Trustee, without any further act,
deed 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. The Depositor, the Servicer and the predecessor
Trustee shall execute and deliver such instruments and do such other things as
may reasonably be required for fully and certainly vesting and confirming in the
successor Trustee all such rights, powers, duties and obligations.
No successor Trustee shall accept appointment as provided in this
Section 8.08 unless at the time of such acceptance such successor Trustee shall
be eligible under the provisions of Section 8.06 and the appointment of such
successor Trustee shall not result in a downgrading of the Regular Certificates
by either Rating Agency, as evidenced by a letter from each Rating Agency.
Upon acceptance of appointment by a successor Trustee as provided in
this Section 8.08, the successor Trustee shall mail notice of the appointment of
a successor Trustee hereunder to all Holders of Certificates at their addresses
as shown in the Certificate Register and to each Rating Agency.
Section 8.09 Merger or Consolidation of Trustee.
Any entity into which the Trustee may be merged or converted or with
which it may be consolidated, or any entity resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any entity
succeeding to the business of the Trustee, shall be the successor of the Trustee
hereunder, provided such entity shall be eligible under the provisions of
Section 8.06 and 8.08, without the execution or filing of any paper or any
further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding.
Section 8.10 Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any time,
for the purpose of meeting any legal requirements of any jurisdiction in which
any part of the Trust or any Mortgaged Property may at the time be located, the
Depositor and the Trustee acting jointly shall have the power and shall execute
and deliver all instruments to appoint one or more Persons approved by the
Trustee to act as co-trustee or co-trustees, jointly with the Trustee, or
separate trustee or separate trustees, of all or any part of the Trust, and to
vest in such Person or Persons, in such capacity and for the benefit of the
Certificateholders, such title to the Trust, or any part thereof, and, subject
to the other provisions of this Section 8.10, such powers, duties, obligations,
rights and trusts as the Servicer and the Trustee may consider necessary or
desirable. Any such co-trustee or separate trustee shall be subject to the
written approval of the Servicer. If the Servicer shall not have joined in such
appointment within 15 days after the receipt by it of a request so to do, or in
the case a Servicer Event of Termination shall have occurred and be continuing,
the Trustee alone shall have the power to make such appointment. No co-trustee
or separate trustee hereunder shall be required to meet the terms of eligibility
as a successor Trustee under Section 8.06, and no notice to Certificateholders
of the appointment of any co-trustee or separate trustee shall be required under
Section 8.08. The Servicer shall be responsible for the fees of any co-trustee
or separate trustee appointed hereunder.
Every separate trustee and co-trustee shall, to the extent permitted by
law, be appointed and act subject to the following provisions and conditions:
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(i) all rights, powers, duties and obligations conferred or imposed
upon the Trustee shall be conferred or imposed upon and exercised or performed
by the Trustee and such separate trustee or co-trustee jointly (it being
understood that such separate trustee or co-trustee is not authorized to act
separately without the Trustee joining in such act), except to the extent that
under any law of any jurisdiction in which any particular act or acts are to be
performed (whether as Trustee hereunder or as successor to the Servicer
hereunder), the Trustee shall be incompetent or unqualified to perform such act
or acts, in which event such rights, powers, duties and obligations (including
the holding of title to the Trust or any portion thereof in any such
jurisdiction) shall be exercised and performed singly by such separate trustee
or co-trustee, but solely at the direction of the Trustee;
(ii) no trustee hereunder shall be held personally liable by reason of
any act or omission of any other trustee hereunder; and
(iii) the Servicer and the Trustee, acting jointly may at any time
accept the resignation of or remove any separate trustee or co-trustee except
that following the occurrence of a Servicer Event of Termination, the Trustee
acting alone may accept the resignation or remove any separate trustee or
co-trustee.
Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the then separate trustees and co-trustees,
as effectively as if given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Agreement and the conditions
of this Article VIII. Each separate trustee and co-trustee, upon its acceptance
of the 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 thereof given to the
Depositor, the Rating Agencies and the Servicer.
Any separate trustee or co-trustee may, at any time, constitute the
Trustee, its agent or attorney-in-fact, with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee, to the extent permitted by law, without the appointment of a new or
successor Trustee.
Section 8.11 Limitation of Liability.
The Certificates are executed by the Trustee, not in its individual
capacity but solely as Trustee of the Trust, in the exercise of the powers and
authority conferred and vested in it by this Agreement. Each of the undertakings
and agreements made on the part of the Trustee in the Certificates is made and
intended not as a personal undertaking or agreement by the Trustee but is made
and intended for the purpose of binding only the Trust.
Section 8.12 Trustee May Enforce Claims Without Possession of
Certificates.
(a) All rights of action and claims under this Agreement or the
Certificates may be prosecuted and enforced by the Trustee without the
possession of any of the Certificates or the production thereof in any
proceeding relating thereto, and such proceeding instituted by the Trustee shall
be brought in its own name or in its capacity as Trustee for the benefit of all
Holders of such Certificates, subject to the provisions of this Agreement. Any
recovery of judgment shall, after provision for the payment of the reasonable
compensation, expenses, disbursement and advances of the Trustee, its agents and
counsel, be for the ratable benefit of the Certificateholders in respect of
which such judgment has been recovered.
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(b) The Trustee shall afford the Sponsor, the Depositor, the Servicer
and each Certificateholder upon reasonable notice during normal business hours,
access to all records maintained by the Trustee in respect of its duties
hereunder and access to officers of the Trustee responsible for performing such
duties. The Trustee shall cooperate fully with the Sponsor, the Servicer, the
Depositor and such Certificateholder and shall make available to the Sponsor,
the Servicer, the Depositor and such Certificateholder for review and copying at
the expense of the party requesting such copies, such books, documents or
records as may be requested with respect to the Trustee's duties hereunder. The
Sponsor, the Depositor, the Servicer and the Certificateholders shall not have
any responsibility or liability for any action or failure to act by the Trustee
and are not obligated to supervise the performance of the Trustee under this
Agreement or otherwise.
Section 8.13 Suits for Enforcement.
In case a Servicer Event of Termination or other default by the
Servicer or the Sponsor hereunder shall occur and be continuing, the Trustee may
proceed to protect and enforce its rights and the rights of the
Certificateholders under this Agreement by a suit, action or proceeding in
equity or at law or otherwise, whether for the specific performance of any
covenant or agreement contained in this Agreement or in aid of the execution of
any power granted in this Agreement or for the enforcement of any other legal,
equitable or other remedy, as the Trustee, being advised by counsel, and subject
to the foregoing, shall deem most effectual to protect and enforce any of the
rights of the Trustee and the Certificateholders.
Section 8.14 Waiver of Bond Requirement.
The Trustee shall be relieved of, and each Certificateholder hereby
waives, any requirement of any jurisdiction in which the Trust, or any part
thereof, may be located that the Trustee post a bond or other surety with any
court, agency or body whatsoever.
Section 8.15 Waiver of Inventory, Accounting and Appraisal Requirement.
The Trustee shall be relieved of, and each Certificateholder hereby
waives, any requirement of any jurisdiction in which the Trust, or any part
thereof, may be located that the Trustee file any inventory, accounting or
appraisal of the Trust with any court, agency or body at any time or in any
manner whatsoever.
ARTICLE IX
REMIC AND GRANTOR TRUST ADMINISTRATION
Section 9.01 REMIC Administration.
(a) The Trustee shall make or cause to be made REMIC elections for each
of REMIC 1, REMIC 2, REMIC B-2, REMIC B-3, REMIC B-4, REMIC B-5 and REMIC X/N as
set forth in the Preliminary Statement 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.
(c) The Servicer 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 Servicer in fulfilling its duties hereunder. The Servicer
shall be entitled to reimbursement of expenses to the extent provided in clause
(i) above from the Collection Account, but only to the extent that such expenses
are "unanticipated expenses" under Treasury Regulations Section
1.860G-1(b)(3)(ii).
(d) The Trustee shall prepare or cause to be prepared, sign and file or
cause to be filed, each REMIC's federal and state tax and information returns as
such REMIC's direct representative. The expenses of preparing and filing such
returns shall be borne by the Trustee.
(e) The Holder of the Residual Certificates with respect to each REMIC
holding the largest Percentage Interest shall be the "tax matters person" as
defined in the REMIC Provisions (the "Tax Matters Person") with respect to the
applicable REMIC or REMICs, and the Trustee is irrevocably designated as and
shall act as attorney-in-fact and agent for such Tax Matters Person for each
REMIC. The Trustee, as agent for the Tax Matters Person, 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 Trustee, as agent for the Tax Matters
Person, shall provide (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
and (ii) to the Certificateholders such information or reports as are required
by the Code or REMIC Provisions.
(f) The Trustee, the Servicer and the Holders of Certificates shall
take any action or cause any REMIC to take any action necessary to create or
maintain the status of such REMIC as a REMIC under the REMIC Provisions and
shall assist each other as necessary to create or maintain such status. Neither
the Trustee, the Servicer, nor the Holder of any Residual Certificate shall take
any action or 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 (i) endanger the status of such REMIC as a
REMIC or (ii) result in the imposition of a tax upon such REMIC (including but
not limited to the tax on prohibited transactions as defined in Code Section
860F(a)(2) and the tax on prohibited contributions set forth on Section 860G(d)
of the Code) (either such event, an "Adverse REMIC Event") unless such action or
failure to take such action is expressly permitted under the terms of this
Agreement or the Trustee and the 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 such 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 and the Servicer, or their respective
designees, in writing, with respect to whether such action could cause an
Adverse REMIC Event to occur with respect to such REMIC, and no such Person
shall take any such action or cause such REMIC to take any such action as to
which the Trustee or the Servicer has advised it in writing that an Adverse
REMIC Event could occur.
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(g) Each Holder of a Residual Certificate shall pay when due its pro
rata share of any and all taxes imposed on any REMIC by federal or state
governmental authorities. To the extent that such REMIC taxes are not paid by
Residual Certificateholders, the Trustee shall pay any remaining REMIC taxes out
of current or future amounts otherwise distributable to the Holder of the
Residual Certificate in each REMIC or, if no such amounts are available, out of
other amounts held in the Collection Account, and shall reduce amounts otherwise
payable to Holders of the REMIC Regular Interests or the Certificates, as the
case may be.
(h) The Trustee, shall, for federal income tax purposes, maintain or
cause to be maintained 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 with respect to Eligible
Substitute Mortgage Loans.
(j) Neither the Trustee nor the Servicer shall enter into any
arrangement by which any REMIC will receive a fee or other compensation for
services.
(k) On or before April 15 of each calendar year beginning in 2007, the
Servicer shall deliver to the Trustee and each Rating Agency an Officer's
Certificate stating the Servicer's compliance with the provisions of this
Section 9.01.
(l) The Trustee shall treat the rights of the Cap Carryover
Certificates to receive Net WAC Carryover Amounts (i) from sources other than
the Reserve Account as a right in interest rate cap contracts written by the
Holder of the Class X/N Interest, and (ii) from the Reserve Account as a right
in interest rate cap contracts written by the Cap Contract Counterparty, in
favor of the Holders of the Cap Carryover Certificates, and the Trustee shall
account for such as property held separate and apart from the regular interests
it holds in each of the REMICs created hereunder. This provision is intended to
satisfy the requirements of Treasury Regulations Section 1.860G-2(i) for the
treatment of property rights coupled with regular interests to be separately
respected and shall be interpreted consistent with such regulation. On each
Distribution Date, to the extent the Cap Carryover Certificates receive payments
in respect of Net WAC Carryover Amounts from sources other than the Reserve
Account, such interest will be treated as distributed on the REMIC 2 X/N
Interest, then on the REMIC X/N X/N Interest and then paid to the respective
Class of Cap Carryover Certificates pursuant to the related interest rate cap
agreement.
(m) [RESERVED]
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(n) In the event that the beneficial ownership of the Class N
Certificates and the Class X Certificates is held by a single Person for federal
income tax purposes or by multiple Persons who beneficially own the Class N and
Class X Certificates proportionately, such Person or Persons shall be treated as
the direct or indirect beneficial owner of the Class X/N Interest and the REMIC
X/N Regular Interest represented thereby. In the event the Trustee receives
written notice that beneficial ownership of the Class N and the Class X
Certificates is held by two or more Persons for tax purposes that do not
beneficially own the Class N and Class X Certificates proportionately, the
Trustee shall treat the Class N Certificateholders and the Class X
Certificateholders as partners in a partnership that owns the Class X/N Interest
and the REMIC X/N Regular Interest represented thereby for federal income tax
purposes and shall not treat the Class N and Class X Certificates as a direct
interest in any REMIC created hereunder. By acquiring the Class N Certificates
and the Class X Certificates, the respective Holders will agree to treat the
Class N Certificates and the Class X Certificates in the manner described in the
preceding sentences for federal income tax purposes in the event that the
beneficial ownership of the Class N Certificates and the Class X Certificates is
separated. In such event, (i) a separate capital account shall be established
and maintained for each Holder of a Class N or Class X Certificate in accordance
with Treasury Regulations Section 1.704-1(b)(2)(iv), which shall be credited
with income or gain and debited by any expenses (including any payments deemed
made by such partnership to the Holders of any of the Cap Carryover Certificates
on interest rate cap agreements for federal income tax purposes) or losses and
distributions allocable to such Certificates, (ii) the Class N Certificates
shall be allocated income in an amount equal to interest at the Pass-Through
Rate thereon and any original issue discount that would be reportable thereon if
the Class N Certificate were a debt instrument issued on the date ownership of
the Class N and Class X Certificates is separated, with a principal balance
equal to its Notional Amount, (iii) the Class X and Class N Certificates shall
be allocated income with respect to all prepayment penalties (including amounts
in connection with the full or partial waiver of such prepayment penalties or
premiums pursuant to Section 3.01) in accordance with the allocation of such
amounts pursuant to Section 4.02(c), to the extent not allocated pursuant to
Section 9.01(n)(ii) above, (iv) the Class X and Class N Certificates shall be
allocated accruals (under any reasonable method) of any "cap premiums" deemed
received on the date ownership of the Class X and Class N Certificates is
separated in respect of the obligation of the Class X/N Interest to pay Net WAC
Carryover Amounts, and shall be allocated expense in respect of such Net WAC
Carryover Amounts based on which one of such Classes economically bears such
expense, (v) the Class X Certificates shall be allocated all remaining income
and any expenses and Realized Losses with respect to the Class X/N Interest,
until the capital account of the Class X Certificates is reduced to zero, and
any remaining expenses or losses shall be allocated to the Class N Certificates,
(vi) neither the Class N Certificates nor the Class X Certificates shall be
responsible for restoring any deficit to its capital account, (vii) upon
termination of the Trust Fund pursuant to Article X, all amounts available for
distribution to Holders of the Class N and Class X Certificates shall be
distributed in accordance with their positive capital account balances, first to
the Class N Certificates until their Notional Amount and any accrued but unpaid
interest thereon are reduced to zero, and then to the Class X Certificates, and
(viii) the Trustee shall maintain books and records with respect to the
partnership on a calendar year basis (unless a different taxable year shall be
required by the Code) and shall prepare or cause to be prepared, and cause the
Holder of the largest Percentage Interest of the Class X Certificates to sign
and file or cause to be filed all federal and state tax and information returns
for the partnership, and shall furnish or cause to be furnished Schedule K-1 to
the Holders of the Class N and Class X Certificates at the time required by the
Code. Unless otherwise directed by a majority of the Percentage Interests of the
Class X and Class N Certificates, the Trustee shall not make an election under
Section 754 of the Code. The Holder of the largest Percentage Interest of the
Class X Certificates, by acceptance of its Class X Certificate, agrees to act as
"tax matters partner" (within the meaning of Section 6231(a)(7) of the Code) and
to sign and timely file all federal and state partnership tax and information
returns prepared by the Trustee pursuant to this Section 9.01(n).
Section 9.02 Prohibited Transactions and Activities.
Neither the Sponsor, the Depositor, the 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 any REMIC pursuant to
Article X 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 constituting part of the Trust
Fund, nor sell or dispose of any investments in the Distribution Account for
gain, nor accept any contributions to any REMIC constituting part of the Trust
Fund after the Closing Date, unless it has received an Opinion of Counsel (at
the expense of the party causing such sale, disposition, or substitution) that
such disposition, acquisition, substitution, or acceptance will not (a) affect
adversely the status of such REMIC as a REMIC or of the interests therein other
than the Residual Certificates as the regular interests therein, (b) affect the
distribution of interest or principal on the Certificates, (c) result in the
encumbrance of the assets transferred or assigned to the Trust Fund (except
pursuant to the provisions of this Agreement) or (d) cause such REMIC to be
subject to a tax on prohibited transactions or prohibited contributions pursuant
to the REMIC Provisions.
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Section 9.03 Indemnification with Respect to Certain Taxes and Loss of
REMIC Status.
In the event that any REMIC formed hereunder fails to qualify as a
REMIC, loses its status as a REMIC, or incurs federal, state or local taxes as a
result of a prohibited transaction or prohibited contribution under the REMIC
Provisions due to the negligent performance by the Servicer of its duties and
obligations set forth herein, the Servicer shall indemnify the Holder of the
related Residual Certificate against any and all losses, claims, damages,
liabilities or expenses ("Losses") resulting from such negligence; provided,
however, that the Servicer shall not be liable for any such Losses attributable
to the action or inaction of the Trustee, the Depositor or the Holder of such
Residual Certificate, as applicable, nor for any such Losses resulting from
misinformation provided by the Holder of such Residual Certificate on which the
Servicer has relied. The foregoing shall not be deemed to limit or restrict the
rights and remedies of the Holder of such Residual Certificate now or hereafter
existing at law or in equity. Notwithstanding the foregoing, however, in no
event shall the Servicer 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, (2) for any Losses
other than arising out of a negligent performance by the Servicer of its duties
and obligations set forth herein, and (3) for any special or consequential
damages to Certificateholders (in addition to payment of principal and interest
on the Certificates).
Section 9.04 REO Property.
(a) Subject to compliance with applicable laws and regulations as shall
at any time be in force, and notwithstanding any other provision of this
Agreement, the Servicer, acting on behalf of the Trust hereunder, shall not
rent, lease, or otherwise earn income on behalf of any REMIC constituting part
of the Trust Fund with respect to any REO Property which might cause such REO
Property to fail to qualify as "foreclosure" property within the meaning of
section 860G(a)(8) of the Code or result in the receipt by any REMIC
constituting part of the Trust Fund of any "income from non-permitted assets"
within the meaning of section 860F(a)(2) of the Code or any "net income from
foreclosure property" which is subject to tax under the REMIC Provisions unless
the Servicer has advised the Trustee in writing to the effect that, under the
REMIC Provisions, such action would not adversely affect the status of any REMIC
constituting part of the Trust Fund as a REMIC and any income generated for such
REMIC by the REO Property would not result in the imposition of a tax upon such
REMIC.
(b) The Servicer shall make reasonable efforts to sell any REO Property
for its fair market value. In any event, however, the Servicer shall dispose of
any REO Property before the close of the third calendar year beginning after the
year of its acquisition by the Trust Fund unless the Servicer 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, any REMIC constituting part of the Trust Fund may hold REO Property
for a longer period without adversely affecting its REMIC status or causing the
imposition of a Federal or state tax upon any REMIC. If the Servicer has
received such an extension, then the Servicer shall continue to attempt to sell
the REO Property for its fair market value as determined in good faith by the
Servicer for such longer period as such extension permits (the "Extended
Period"). If the Servicer has not received such an extension and the Servicer is
unable to sell the REO Property within 33 months after its acquisition by the
Trust Fund or if the Servicer has received such an extension, and the Servicer
is unable to sell the REO Property within the period ending three months before
the close of the Extended Period, the Servicer shall, before the end of the
applicable period, (i) purchase such REO Property at a price equal to the REO
Property's fair market value as determined in good faith by the Servicer or (ii)
auction the REO Property to the highest bidder (which may be the Servicer) in an
auction reasonably designed to produce a fair price prior to the expiration of
the applicable period.
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Section 9.05 Grantor Trust Administration.
The parties intend that the portions of the Trust Fund consisting of
the REMIC X/N X/N Interest and the obligation to pay Net WAC Carryover Amounts
(other than such amounts funded by the Reserve Account), shall be treated as a
"grantor trust" under the Code, and the provisions hereof shall be interpreted
consistently with this intention. In furtherance of such intention, the Trustee
shall furnish or cause to be furnished (i) to the Holders of the Cap Carryover
Certificates and (ii) to the Holder of the Class X and Class N Certificates (if
there is a single beneficial owner thereof) or to itself on behalf of the
partnership comprised of the Holders of the Class X and Class N Certificates (if
there are two or more beneficial owners thereof), and shall file or cause to be
filed with the Internal Revenue Service together with Form 1041 or such other
form as may be applicable, indicating their allocable shares of income with
respect to the property held by the Grantor Trust, at the time or times and in
the manner required by the Code.
ARTICLE X
TERMINATION
Section 10.01 Termination.
(a) The respective obligations and responsibilities of the Sponsor, the
Servicer, the Depositor, the Trustee and the Certificate Registrar created
hereby (other than the obligation of the Trustee to make certain payments to
Certificateholders after the final Distribution Date and the obligation of the
Servicer to send certain notices as hereinafter set forth) shall terminate upon
notice to the Trustee upon the earliest of (i) the Distribution Date on which
the Certificate Principal Balance of each Class of Certificates has been reduced
to zero, (ii) the final payment or other liquidation of the last Mortgage Loan
in the Trust Fund, and (iii) the optional purchase by the Servicer of the
Mortgage Loans as described below. Notwithstanding the foregoing, in no event
shall the trust created hereby continue beyond the expiration of 21 years from
the death of the last survivor of the descendants of Xxxxxx X. Xxxxxxx, the late
ambassador of the United States to the Court of St. Xxxxx, living on the date
hereof.
The Servicer (or an Affiliate) may, at its option, terminate the
Mortgage Loans in the Trust Fund and retire the Certificates on the next
succeeding Distribution Date upon which the current Pool Balance is 10% or less
of the Pool Balance of the Mortgage Loans as of the Cut-off Date by purchasing
all of the outstanding (i) Mortgage Loans in the Trust Fund at a price equal to
the sum of the outstanding Principal Balance of the Mortgage Loans and except to
the extent previously advanced by the Servicer, accrued and unpaid interest
thereon at the weighted average of the Mortgage Interest Rates through the end
of the Collection Period preceding the final Distribution Date plus unreimbursed
Servicing Advances, Advances and any unpaid Servicing Fees allocable to such
Mortgage Loans plus any costs or damages incurred by the Trust Fund in
connection with any violation by such Mortgage Loan of any predatory or abusive
lending laws and (ii) REO Properties in the Trust Fund at a price equal to their
fair market value as determined in good faith by the Servicer (the "Termination
Price"). Notwithstanding the foregoing, the Servicer (or an Affiliate) may not
exercise its optional purchase right unless any Reimbursement Amount owed to the
Trust pursuant to Section 2.03 hereof has been paid.
In connection with any such purchase pursuant to the preceding
paragraph, the Servicer shall deliver to the Trustee for deposit in the
Distribution Account all amounts then on deposit in the Collection Account (less
amounts permitted to be withdrawn by the Servicer pursuant to Section 3.07),
which deposit shall be deemed to have occurred immediately following such
purchase.
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Any such purchase shall be accomplished by delivery to the Trustee for
deposit into the Distribution Account as part of Available Funds on the
Determination Date before such Distribution Date of the Termination Price.
(b) Notice of any termination, specifying the Distribution Date (which
shall be a date that would otherwise be a Distribution Date) upon which the
Certificateholders may surrender their Certificates to the Trustee for payment
of the final distribution and cancellation, shall be given promptly by the
Trustee upon the Trustee receiving notice of such date from the Servicer, by
letter to the Certificateholders mailed not earlier than the 15th day of the
month preceding the month of such final distribution and not later than the 15th
day of the month of such final distribution specifying (1) the Distribution Date
upon which final distribution of the Certificates will be made upon presentation
and surrender of such Certificates at the office or agency of the Trustee
therein designated, (2) the amount of any such final distribution and (3) that
the Record Date otherwise applicable to such Distribution Date is not
applicable, distributions being made only upon presentation and surrender of the
Certificates at the office or agency of the Trustee therein specified. Not less
than five (5) Business Days prior to such Determination Date relating to such
Distribution Date, the Trustee shall notify the Sponsor of the amount of any
unpaid Reimbursement Amount owed to the Trust.
(c) Upon presentation and surrender of the Certificates, the Trustee
shall cause to be distributed to the Holders of the Certificates on the
Distribution Date for such final distribution, in proportion to the Percentage
Interests of their respective Class and to the extent that funds are available
for such purpose, an amount equal to the amount required to be distributed to
such Holders in accordance with the provisions of Section 10.02.
(d) In the event that all Certificateholders shall not surrender their
Certificates for final payment and cancellation on or before such final
Distribution Date, the Trustee shall promptly following such date cause all
funds in the Distribution Account not distributed in final distribution to
Certificateholders to be withdrawn therefrom and credited to the remaining
Certificateholders by depositing such funds in a separate escrow account for the
benefit of such Certificateholders, and the Servicer (if the Servicer has
exercised its right to purchase the Mortgage Loans) or the Trustee (in any other
case) 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 nine months after the second notice all the
Certificates shall not have been surrendered for cancellation, the Class R
Certificateholders shall be entitled to all unclaimed funds and other assets
which remain subject hereto and the Trustee upon transfer of such funds shall be
discharged of any responsibility for such funds, and such Certificateholders
shall look to the Class R Certificateholders for payment.
Section 10.02 Additional Termination Requirements.
(a) In the event that the Servicer exercises its purchase option as
provided in Section 10.01, the Trust shall be terminated in accordance with the
following additional requirements, unless the Trustee shall have been furnished
with an Opinion of Counsel to the effect that the failure of the Trust to comply
with the requirements of this Section will not (i) result in the imposition of
taxes on "prohibited transactions" of the Trust as defined in Section 860F of
the Code or (ii) cause any REMIC constituting part of the Trust Fund to fail to
qualify as a REMIC at any time that any Certificates are outstanding:
(i) The Trustee shall designate a date within 90 days prior to
the final Distribution Date as the date of adoption of plans of
complete liquidation delivered to it by the Servicer of each of the
remaining REMICs included in the Trust Fund and shall specify such date
in the final federal income tax return of each REMIC;
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(ii) After the date of adoption of such plans of complete
liquidation and at or prior to the final Distribution Date, the Trustee
shall sell all of the assets of the Trust to the Servicer for cash; and
(iii) At the time of the making of the final payment on the
Certificates, the Trustee shall distribute or credit, or cause to be
distributed or credited in the following order of priority (A) (i) to
the Holders of each of the Class AV and Class AF Certificates, pro rata
and (ii) 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, Class B-3, Class B-4 and Class B-5
Certificates, the related Certificate Principal Balance, as applicable,
plus one month's interest thereon at the applicable Pass-Through Rate,
(B) (i) any Net WAC Carryover Amounts not previously distributed and
(ii) to the Class N and Class X Certificates in respect of the Class
X/N Interest, the amount of any remaining Monthly Excess Cash Flow
Amounts not previously distributed thereon, (C) to the remaining REMIC
Regular Interests the amounts allocable thereto pursuant to Section
4.08 and (D) to the Class R Certificateholders, all cash on hand in
respect of the related REMIC or REMICs after such payment (other than
cash retained to meet claims) and the Trust shall terminate at such
time.
(b) By their acceptance of Certificates, the Holders thereof hereby
agree to appoint the Trustee as their attorney in fact to: (i) designate such
date of adoption of plans of complete liquidation and (ii) to take such other
action in connection therewith as may be reasonably required to carry out such
plans of complete liquidation all in accordance with the terms hereof.
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01 Amendment.
This Agreement may be amended from time to time by the Sponsor, the
Depositor, the Servicer and the Trustee; and without the consent of the
Certificateholders, (i) to cure any ambiguity, (ii) to correct or supplement any
provisions herein which may be defective or inconsistent with any other
provisions herein, (iii) to make any other provisions with respect to matters or
questions arising under this Agreement, which shall not be inconsistent with the
provisions of this Agreement, or (iv) to comply with any requirements imposed by
the Code; provided, however, that any such action listed in clause (i) through
(iv) above shall not adversely affect in any respect the interests of any
Certificateholder, as evidenced by (i) notice in writing to the Depositor, the
Servicer and the Trustee from the Rating Agencies that such action will not
result in the reduction or withdrawal of the rating of any outstanding Class of
Certificates with respect to which it is a Rating Agency, or (ii) an Opinion of
Counsel delivered to the Servicer and the Trustee. In addition, this Agreement
may be amended from time to time by the Sponsor, the Depositor, the Servicer and
the Trustee without the consent of any of the Certificateholders to comply with
the provisions of Regulation AB.
In addition, this Agreement may be amended from time to time by the
Sponsor, the Depositor, the Servicer and the Trustee, with the consent of the
Majority Certificateholders for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Agreement or
of modifying in any manner the rights of the Holders of Certificates; provided,
however, that no such amendment or waiver shall (x) reduce in any manner the
amount of, or delay the timing of, payments on the Certificates which are
required to be made on any Certificate without the consent of the Holder of such
Certificate, (y) adversely affect in any material respect the interests of the
Holders of any Class of Certificates in a manner other than as described in
clause (x) above, without the consent of the Holders of Certificates of such
Class evidencing at least a 66 2/3% Percentage Interest in such Class, or (z)
reduce the percentage of Voting Rights required by clause (y) above without the
consent of the Holders of all Certificates of such Class then outstanding. Upon
approval of an amendment, a copy of such amendment shall be sent to the Rating
Agencies.
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Prior to the execution of any amendment to this Agreement, the Trustee
shall be entitled to receive and rely upon an Opinion of Counsel (at the expense
of the Person seeking such amendment) stating that the execution of such
amendment is authorized or permitted by this Agreement. The Trustee may, but
shall not be obligated to, enter into any such amendment which affects the
Trustee's own rights, duties or immunities under this Agreement.
Notwithstanding any provision of this Agreement to the contrary, the
Trustee shall not consent to any amendment to this Agreement unless it shall
have first received an Opinion of Counsel, delivered by (and at the expense of)
the Person seeking such Amendment, to the effect that such amendment is
permitted hereunder and will not result in the imposition of a tax on any REMIC
constituting part of the Trust Fund pursuant to the REMIC Provisions or cause
any REMIC constituting part of the Trust to fail to qualify as a REMIC at any
time that any Certificates are outstanding and that the amendment is being made
in accordance with the terms hereof.
Promptly after the execution of any such amendment the Trustee shall
furnish, at the expense of the Person that requested the amendment if such
Person is the Sponsor or the Servicer (but in no event at the expense of the
Trustee), otherwise at the expense of the Trust, a copy of such amendment and
the Opinion of Counsel referred to in the immediately preceding paragraph to the
Servicer and each Rating Agency.
It shall not be necessary for the consent of Certificateholders under
this Section 11.01 to approve the particular form of any proposed amendment;
instead it shall be sufficient if such consent shall approve the substance
thereof. The manner of obtaining such consents and of evidencing the
authorization of the execution thereof by Certificateholders shall be subject to
such reasonable regulations as the Trustee may prescribe.
Notwithstanding anything to the contrary in this Section 11.01, the
Trustee, the Sponsor and the Servicer shall reasonably cooperate with the
Depositor and its counsel to enter into such amendments or modifications to the
Agreement as may be necessary to comply with Regulation AB and any
interpretation thereof by the Securities and Exchange Commission.
Section 11.02 Recordation of Agreement; Counterparts.
To the extent permitted by applicable law, this Agreement is subject to
recordation in all appropriate public offices for real property records in all
the counties or other comparable jurisdictions in which any or all of the
properties subject to the Mortgages are situated, and in any other appropriate
public recording office or elsewhere, such recordation to be effected by the
Servicer at the expense of the Trust, but only upon direction of
Certificateholders, accompanied by an Opinion of Counsel to the effect that such
recordation materially and beneficially affects the interests of the
Certificateholders.
For the purpose of facilitating the recordation of this Agreement as
herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall together constitute but
one and the same instrument.
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Section 11.03 Limitation on Rights of Certificateholders.
The death or incapacity of any Certificateholder shall not (i) operate
to terminate this Agreement or the Trust, (ii) entitle such Certificateholder's
legal representatives or heirs to claim an accounting or to take any action or
proceeding in any court for a partition or winding up of the Trust, or (iii)
otherwise affect the rights, obligations and liabilities of the parties hereto
or any of them.
Except as expressly provided for herein, no Certificateholder shall
have any right to vote or in any manner otherwise control the operation and
management of the Trust, 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.
No Certificateholder shall have any right by virtue of any provision of
this Agreement to institute any suit, action or proceeding in equity or at law
upon or under or with respect to this Agreement, unless such Holder previously
shall have given to the Trustee a written notice of default and of the
continuance thereof, as herein provided, and unless also the Holders of
Certificates entitled to at least 25% of the Voting Rights shall have made
written request upon the Trustee to institute such action, suit or proceeding in
its own name as Trustee hereunder and shall have offered to the Trustee such
reasonable indemnity as it may require against the costs, expenses and
liabilities to be incurred therein or thereby, and the Trustee for 15 days after
its receipt of such notice, request and offer of indemnity, shall have neglected
or refused to institute any such action, suit or proceeding. It is understood
and intended, and expressly covenanted by each Certificateholder with every
other Certificateholder and the Trustee, that no one or more Holders of
Certificates shall have any right in any manner whatever by virtue of any
provision of this Agreement to affect, disturb or prejudice the rights of the
Holders of any other of such Certificates, or to obtain or seek to obtain
priority over or preference to any other such Holder, which priority or
preference is not otherwise provided for herein, or to enforce any right under
this Agreement, except in the manner herein provided and for the equal, ratable
and common benefit of all Certificateholders. For the protection and enforcement
of the provisions of this Section 11.03 each and every Certificateholder and the
Trustee shall be entitled to such relief as can be given either at law or in
equity.
Section 11.04 Governing Law; Jurisdiction.
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. With respect to any
claim arising out of this Agreement, each party irrevocably submits to the
exclusive jurisdiction of the courts of the State of New York and the United
States District Court located in the Borough of Manhattan in The City of New
York, and each party irrevocably waives any objection which it may have at any
time to the laying of venue of any suit, action or proceeding arising out of or
relating hereto brought in any such courts, irrevocably waives any claim that
any such suit, action or proceeding brought in any such court has been brought
in any inconvenient forum and further irrevocably waives the right to object,
with respect to such claim, suit, action or proceeding brought in any such
court, that such court does not have jurisdiction over such party, provided that
service of process has been made by any lawful means.
Section 11.05 Notices.
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All directions, demands and notices hereunder shall be in writing and
shall be deemed to have been duly given if personally delivered at or mailed by
first class mail, postage prepaid, or by express delivery service, to (a) in the
case of the Sponsor, Credit-Based Asset Servicing and Securitization LLC, 000
Xxxxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Director -
Mortgage Finance (telecopy number (000) 000-0000), or such other address or
telecopy number as may hereafter be furnished to the Depositor and the Trustee
in writing by the Sponsor, (b) in the case of the Trustee, JPMorgan Chase Bank,
National Association, 0 Xxx Xxxx Xxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Worldwide Securities Services/Structured Finance Services, Ownit
2006-1, or such other address as may hereafter be furnished to the Depositor,
the Sponsor and the Servicer in writing by the Trustee, (c) in the case of the
Depositor, Xxxxxxx Xxxxx Mortgage Investors, Inc., 000 Xxxxx Xxxxxx, 4 World
Financial Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Asset-Backed
Finance, or such other address as may be furnished to the Sponsor, the Servicer
and the Trustee in writing by the Depositor, and (d) in the case of the
Servicer, Xxxxxx Loan Servicing LP, 0000 Xxxx Xxxxxxx Xxxxx, Xxxxxxx, Xxxxx
00000, Attention: Xxxxxx XxXxxxx, or such other address as may be furnished to
the Sponsor, the Depositor and the Trustee in writing by the Servicer. Any
notice required or permitted to be mailed to a Certificateholder shall be given
by first class mail, postage prepaid, at the address of such Holder as shown in
the Certificate Register. Notice of any Servicer Event of Termination shall be
given by telecopy and by certified mail. Any notice so mailed within the time
prescribed in this Agreement shall be conclusively presumed to have duly been
given when mailed, whether or not the Certificateholder receives such notice. A
copy of any notice required to be telecopied hereunder shall also be mailed to
the appropriate party in the manner set forth above.
Section 11.06 Severability of Provisions.
If any one or more of the covenants, agreements, provisions or terms of
this Agreement shall for any reason whatsoever be held invalid, then such
covenants, agreements, provisions or terms shall be deemed severable from the
remaining covenants, agreements, provisions or terms of this Agreement and shall
in no way affect the validity or enforceability of the other provisions of this
Agreement or of the Certificates or the rights of the Holders thereof.
Section 11.07 Article and Section References.
All article and section references used in this Agreement, unless
otherwise provided, are to articles and sections in this Agreement.
Section 11.08 Notice to the Rating Agencies.
(a) Each of the Trustee and the Servicer shall be obligated to use its
best reasonable efforts promptly to provide notice to the Rating Agencies with
respect to each of the following of which a Responsible Officer of the Trustee
or the Servicer, as the case may be, has actual knowledge:
(i) any material change or amendment to this Agreement;
(ii) the occurrence of any Servicer Event of Termination that
has not been cured or waived;
(iii) the resignation or termination of the Servicer or the
Trustee;
(iv) the final payment to Holders of the Certificates of any
Class;
(v) any change in the location of any Account; and
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(vi) if the Trustee is acting as successor Servicer pursuant
to Section 7.02 hereof, any event that would result in the inability of
the Trustee to make Advances.
(vii) In addition, the Servicer shall promptly furnish to each
Rating Agency copies of the following:
(A) each annual statement as to compliance described
in Section 3.19 hereof;
(B) each annual independent public accountants'
servicing report described in Section 3.20 hereof; and
(C) each notice delivered pursuant to Section 7.01(a)
hereof which relates to the fact that the Servicer has not
made an Advance.
Any such notice pursuant to this Section 11.08 shall be in writing and
shall be deemed to have been duly given if personally delivered or mailed by
first class mail, postage prepaid, or by express delivery service to Xxxxx'x
Investors Service, Inc., 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Managing Director, Residential Mortgage-Backed Securities; and Standard &
Poor's, a division of The XxXxxx-Xxxx Companies, Inc., 00 Xxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attention: Mortgage Surveillance Group.
Section 11.09 Further Assurances.
Notwithstanding any other provision of this Agreement, neither the
Regular Certificateholders, nor the Trustee shall have any obligation to consent
to any amendment or modification of this Agreement unless they have been
provided reasonable security or indemnity against their out-of-pocket expenses
(including reasonable attorneys' fees) to be incurred in connection therewith.
Section 11.10 Section 11.10 Benefits of Agreement.
Nothing in this Agreement or in the Certificates, expressed or implied,
shall give to any Person, other than the Certificateholders and the parties
hereto and their successors hereunder, any benefit or any legal or equitable
right, remedy or claim under this Agreement.
Section 11.11 Acts of Certificateholders.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Agreement to be given or taken by the
Certificateholders may be embodied in and evidenced by one or more instruments
of substantially similar tenor signed by such Certificateholders in person or by
agent duly appointed in writing; and such action shall become effective when
such instrument or instruments are delivered to the Trustee, the Sponsor and the
Servicer. Such instrument or instruments (and the action embodied therein and
evidenced thereby) are herein sometimes referred to as the "act" of the
Certificateholders signing such instrument or instruments. Proof of execution of
any such instrument or of a writing appointing any such agent shall be
sufficient for any purpose of this Agreement and conclusive in favor of the
Trustee and the Trust, if made in the manner provided in this Section 11.11.
(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 a notary public or other officer authorized
by law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Whenever
such execution is by a signer acting in a capacity other than his or her
individual capacity, such certificate or affidavit shall also constitute
sufficient proof of his authority.
135
(c) Any request, demand, authorization, direction, notice, consent,
waiver or other action by any Certificateholder shall bind every future Holder
of such 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
Trust in reliance thereon, whether or not notation of such action is made upon
such Certificate.
Section 11.12 Compliance with Regulation AB.
Each of the parties hereto acknowledges and agrees that the purpose of
Sections 3.19, 3.20 and 3.29 of this Agreement is to facilitate compliance by
the Depositor with the provisions of Regulation AB, as such may be amended or
clarified from time to time. Therefore, each of the parties agrees that (a) the
obligations of the parties hereunder shall be interpreted in such a manner as to
accomplish compliance with Regulation AB, (b) the parties' obligations hereunder
will be supplemented and modified as necessary to be consistent with any such
amendments, interpretive advice or guidance, convention or consensus among
active participants in the asset-backed securities markets, advice of counsel,
or otherwise in respect of the requirements of Regulation AB and (c) the parties
shall comply with reasonable requests made by the Depositor for delivery of that
or different information as the Depositor may determine in good faith is
necessary to comply with the provisions of Regulation AB.
[SIGNATURE PAGES IMMEDIATELY FOLLOW]
136
IN WITNESS WHEREOF, the Sponsor, the Depositor, the Servicer and the
Trustee have caused their names to be signed hereto by their respective officers
thereunto duly authorized, all as of the day and year first above written.
XXXXXXX XXXXX MORTGAGE INVESTORS, INC.,
as Depositor
By: -----------------------------------
Name:
Title:
CREDIT-BASED ASSET SERVICING AND
SECURITIZATION LLC, as Sponsor
By: -----------------------------------
Name:
Title:
XXXXXX LOAN SERVICING LP, as Servicer
By: -----------------------------------
Name: Xxxxxx XxXxxxx
Title: Senior Vice President
JPMORGAN CHASE BANK, National Association,
not in its individual capacity
but solely as Trustee for the Ownit
Mortgage Loan Trust, Series 2006-1
By: -----------------------------------
Name:
Title:
EXHIBIT A-1
FORM OF THE CLASS AV CERTIFICATE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS BENEFICIAL
OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE") AND CERTAIN OTHER
PROPERTY.
OWNIT MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2006-1, CLASS AV
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
XXXXXXX XXXXX MORTGAGE INVESTORS, INC.
Series 2006-1, Class AV Original Class Certificate Principal
Balance of the Class AV Certificates as
of the Closing Date: $225,112,000
Pass-Through Rate: Variable(1)
Date of Pooling and Servicing Initial Certificate Principal Balance:
Agreement and Cut-off Date: $225,112,000
January 1, 2006
First Distribution Date:
February 27, 2006 Servicer: Xxxxxx Loan Servicing LP
No. 1 Trustee: JPMorgan Chase Bank, N.A.
CUSIP: 69121P DB 6 Closing Date: January 30, 2006
------------------
(1) Subject to a cap as described in the Agreement
A-1-1
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN
THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXXXX
XXXXX MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY OF THEIR
AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY
OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class AV
Certificates) in that certain beneficial ownership interest evidenced by all the
Class AV Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Xxxxxxx
Xxxxx Mortgage Investors, Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), Credit-Based Asset Servicing
and Securitization LLC (the "Sponsor"), the Servicer and the Trustee, a summary
of certain of the pertinent provisions of which is set forth hereafter. To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class AV
Certificates on such Distribution Date pursuant to the Agreement provided,
however, that if any Class AV Certificate becomes a Definitive Certificate, the
Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar in
writing at least five Business Days prior to the Record Date immediately prior
to such Distribution Date, or by check mailed by first class mail to the address
of the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
A-1-2
The Class AV Pass-Through Rate on each Distribution Date will be a rate
per annum equal to the least of (i) LIBOR as of the related LIBOR Determination
Date, plus the Class AV Certificate Margin, (ii) the Group Net WAC Cap and (iii)
the Group I Maximum Rate Cap. This Certificate is one of a duly authorized issue
of Certificates designated as Ownit Mortgage Loan Asset-Backed Certificates of
the Series specified on the face hereof (herein called the "Certificates") and
representing a Percentage Interest in the Class AV Certificates.
The Class AV Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the Sponsor and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Sponsor and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Trustee as provided in the Agreement, duly
endorsed by, or accompanied by an assignment in the form below or other written
instrument of transfer in form satisfactory to the Trustee and the Certificate
Registrar duly executed by, the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations specified in the Agreement. As provided in
the Agreement and subject to certain limitations therein set forth, Certificates
are exchangeable for new Certificates of the same Class in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in connection with any transfer or exchange of Certificates.
A-1-3
The Depositor, the Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent nor any such agent shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-1-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: January 30, 2006
JPMORGAN CHASE BANK, N.A.,
as Trustee
By:
-------------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
JPMORGAN CHASE BANK, N.A.,
as Certificate Registrar
By:
-------------------------------------
Authorized Signatory
Date of authentication: January 30, 2006
A-1-5
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
-------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right of
survivorship and not as tenants --------------------
in common (State)
Additional abbreviations may also be used though not in the above list.
A-1-6
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto ______________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
-------------------------------------------------------------------------------
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to_________________________________________________
for the account of __________________________, account number _____________, or,
if mailed by check, to ________________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ____________________________________, as its agent.
X-0-0
XXXXXXX X-0
FORM OF CLASS AF-1 CERTIFICATES
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS BENEFICIAL
OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE") AND CERTAIN OTHER
PROPERTY.
OWNIT MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2006-1, CLASS AF-1
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
XXXXXXX XXXXX MORTGAGE INVESTORS, INC.
Series 2006-1, Class AF-1 Original Class Certificate Principal
Balance of the Class AF-1 Certificates
as of the Closing Date: $182,384,000
Pass-Through Rate: 5.4240%(2)
Date of Pooling and Servicing Initial Certificate Principal Balance:
Agreement and Cut-off Date: $182,384,000
January 1, 2006
First Distribution Date: Servicer: Xxxxxx Loan Servicing LP
February 27, 2006
No. 1 Trustee: JPMorgan Chase Bank, N.A.
CUSIP: 69121P CG 6 Closing Date: January 30, 2006
-------------------
(2) Subject to a cap as described in the Agreement
A-2-1
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN
THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXXXX
XXXXX MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY OF THEIR
AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY
OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class
AF-1 Certificates) in that certain beneficial ownership interest evidenced by
all the Class AF-1 Certificates in the Trust Fund created pursuant to a Pooling
and Servicing Agreement, dated as specified above (the "Agreement"), among
Xxxxxxx Xxxxx Mortgage Investors, Inc. (hereinafter called the "Depositor,"
which term includes any successor entity under the Agreement), Credit-Based
Asset Servicing and Securitization LLC (the "Sponsor"), the Servicer and the
Trustee, a summary of certain of the pertinent provisions of which is set forth
hereafter. To the extent not defined herein, the capitalized terms used herein
have the meanings assigned in the Agreement. This Certificate is issued under
and is subject to the terms, provisions and conditions of the Agreement, to
which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs or the Closing
Date in the case of the first Distribution Date (the "Record Date"), from funds
in the Distribution Account in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to the Holders of Class AF-1 Certificates on such Distribution Date pursuant to
the Agreement.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar in
writing at least five Business Days prior to the Record Date immediately prior
to such Distribution Date, or by check mailed by first class mail to the address
of the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
A-2-2
This Certificate is one of a duly authorized issue of Certificates
designated as Ownit Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class AF-1 Certificates.
The Class AF-1 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the Sponsor and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Sponsor and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Trustee as provided in the Agreement, duly
endorsed by, or accompanied by an assignment in the form below or other written
instrument of transfer in form satisfactory to the Trustee and the Certificate
Registrar duly executed by, the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations specified in the Agreement. As provided in
the Agreement and subject to certain limitations therein set forth, Certificates
are exchangeable for new Certificates of the same Class in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent nor any such agent shall be affected by notice to the contrary.
A-2-3
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-2-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: January 30, 2006
JPMORGAN CHASE BANK, N.A.,
as Trustee
By:
-----------------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
JPMORGAN CHASE BANK, N.A.,
as Certificate Registrar
By:
-----------------------------------------
Authorized Signatory
Date of authentication: January 30, 2006
A-2-5
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
-------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right of
survivorship and not as tenants --------------------
in common (State)
Additional abbreviations may also be used though not in the above list.
A-2-6
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
--------------------------------------------------------------------------------
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of __________________, account number _________________, or, if
mailed by check, to ___________________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ____________________________________, as its agent.
X-0-0
XXXXXXX X-0
FORM OF CLASS AF-2 CERTIFICATES
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS BENEFICIAL
OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE") AND CERTAIN OTHER
PROPERTY.
OWNIT MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2006-1, CLASS AF-2
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
XXXXXXX XXXXX MORTGAGE INVESTORS, INC.
Series 2006-1, Class AF-2 Original Class Certificate Principal
Balance of the Class AF-2 Certificates
as of the Closing Date: $112,503,000
Pass-Through Rate: 5.2900%(3)
Date of Pooling and Servicing Initial Certificate Principal Balance:
Agreement and Cut-off Date: $112,503,000
January 1, 2006
First Distribution Date: Servicer: Xxxxxx Loan Servicing LP
February 27, 2006
No. 1 Trustee: JPMorgan Chase Bank, N.A.
CUSIP: 69121P CH 4 Closing Date: January 30, 2006
-----------------
(3) Subject to a cap as described in the Agreement
A-3-1
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN
THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXXXX
XXXXX MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY OF THEIR
AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY
OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class
AF-2 Certificates) in that certain beneficial ownership interest evidenced by
all the Class AF-2 Certificates in the Trust Fund created pursuant to a Pooling
and Servicing Agreement, dated as specified above (the "Agreement"), among
Xxxxxxx Xxxxx Mortgage Investors, Inc. (hereinafter called the "Depositor,"
which term includes any successor entity under the Agreement), Credit-Based
Asset Servicing and Securitization LLC (the "Sponsor"), the Servicer and the
Trustee, a summary of certain of the pertinent provisions of which is set forth
hereafter. To the extent not defined herein, the capitalized terms used herein
have the meanings assigned in the Agreement. This Certificate is issued under
and is subject to the terms, provisions and conditions of the Agreement, to
which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs or the Closing
Date in the case of the first Distribution Date (the "Record Date"), from funds
in the Distribution Account in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to the Holders of Class AF-2 Certificates on such Distribution Date pursuant to
the Agreement.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar in
writing at least five Business Days prior to the Record Date immediately prior
to such Distribution Date, or by check mailed by first class mail to the address
of the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
A-3-2
This Certificate is one of a duly authorized issue of Certificates
designated as Ownit Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class AF-2 Certificates.
The Class AF-2 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the Sponsor and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Sponsor and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Trustee as provided in the Agreement, duly
endorsed by, or accompanied by an assignment in the form below or other written
instrument of transfer in form satisfactory to the Trustee and the Certificate
Registrar duly executed by, the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations specified in the Agreement. As provided in
the Agreement and subject to certain limitations therein set forth, Certificates
are exchangeable for new Certificates of the same Class in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent nor any such agent shall be affected by notice to the contrary.
A-3-3
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-3-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: January 30, 2006
JPMORGAN CHASE BANK, N.A.,
as Trustee
By:
--------------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
JPMORGAN CHASE BANK, N.A.,
as Certificate Registrar
By:
-------------------------------------
Authorized Signatory
Date of authentication: January 30, 2006
A-3-5
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
-------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right of
survivorship and not as tenants --------------------
in common (State)
Additional abbreviations may also be used though not in the above list.
A-3-6
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto ______________________________________________________________
_______________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
-------------------------------------------------------------------------------
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
for the account of _____________________, account number _______________, or, if
mailed by check, to ___________________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ____________________________________, as its agent.
X-0-0
XXXXXXX X-0
FORM OF CLASS AF-3 CERTIFICATES
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS BENEFICIAL
OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE") AND CERTAIN OTHER
PROPERTY.
OWNIT MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2006-1, CLASS AF-3
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
XXXXXXX XXXXX MORTGAGE INVESTORS, INC.
Series 2006-1, Class AF-3 Original Class Certificate Principal
Balance of the Class AF-3 Certificates
as of the Closing Date: $8,503,000
Pass-Through Rate: 5.6560%(4)
Date of Pooling and Servicing Initial Certificate Principal Balance:
Agreement and Cut-off Date: $8,503,000
January 1, 2006
First Distribution Date: Servicer: Xxxxxx Loan Servicing LP
February 27, 2006
No. 1 Trustee: JPMorgan Chase Bank, N.A.
CUSIP: 69121P CJ 0 Closing Date: January 30, 2006
--------------------
(4) Subject to a cap as described in the Agreement
A-4-1
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN
THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXXXX
XXXXX MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY OF THEIR
AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY
OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class
AF-3 Certificates) in that certain beneficial ownership interest evidenced by
all the Class AF-3 Certificates in the Trust Fund created pursuant to a Pooling
and Servicing Agreement, dated as specified above (the "Agreement"), among
Xxxxxxx Xxxxx Mortgage Investors, Inc. (hereinafter called the "Depositor,"
which term includes any successor entity under the Agreement), Credit-Based
Asset Servicing and Securitization LLC (the "Sponsor"), the Servicer and the
Trustee, a summary of certain of the pertinent provisions of which is set forth
hereafter. To the extent not defined herein, the capitalized terms used herein
have the meanings assigned in the Agreement. This Certificate is issued under
and is subject to the terms, provisions and conditions of the Agreement, to
which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs or the Closing
Date in the case of the first Distribution Date (the "Record Date"), from funds
in the Distribution Account in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to the Holders of Class AF-3 Certificates on such Distribution Date pursuant to
the Agreement.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar in
writing at least five Business Days prior to the Record Date immediately prior
to such Distribution Date, or by check mailed by first class mail to the address
of the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
A-4-2
This Certificate is one of a duly authorized issue of Certificates
designated as Ownit Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class AF-3 Certificates.
The Class AF-3 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the Sponsor and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Sponsor and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Trustee as provided in the Agreement, duly
endorsed by, or accompanied by an assignment in the form below or other written
instrument of transfer in form satisfactory to the Trustee and the Certificate
Registrar duly executed by, the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations specified in the Agreement. As provided in
the Agreement and subject to certain limitations therein set forth, Certificates
are exchangeable for new Certificates of the same Class in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent nor any such agent shall be affected by notice to the contrary.
A-4-3
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-4-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: January 30, 2006
JPMORGAN CHASE BANK, N.A.,
as Trustee
By:
-----------------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
JPMORGAN CHASE BANK, N.A.,
as Certificate Registrar
By:
-----------------------------------------
Authorized Signatory
Date of authentication: January 30, 2006
A-4-5
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
-------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right of
survivorship and not as tenants --------------------
in common (State)
Additional abbreviations may also be used though not in the above list.
A-4-6
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
--------------------------------------------------------------------------------
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _________________, account number ___________________, or, if
mailed by check, to ___________________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ____________________________________, as its agent.
X-0-0
XXXXXXX X-0
FORM OF CLASS AF-4 CERTIFICATES
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS BENEFICIAL
OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE") AND CERTAIN OTHER
PROPERTY.
OWNIT MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2006-1, CLASS AF-4
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
XXXXXXX XXXXX MORTGAGE INVESTORS, INC.
Series 2006-1, Class AF-4 Original Class Certificate Principal
Balance of the Class AF-4 Certificates
as of the Closing Date: $33,732,000
Pass-Through Rate: 5.5160%(5)
Date of Pooling and Servicing Initial Certificate Principal Balance:
Agreement and Cut-off Date: $33,732,000
January 1, 2006
First Distribution Date: Servicer: Xxxxxx Loan Servicing LP
February 27, 2006
No. 1 Trustee: JPMorgan Chase Bank, N.A.
CUSIP: 69121P CK 7 Closing Date: January 30, 2006
------------------
(5) Subject to a cap as described in the Agreement
A-5-1
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN
THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXXXX
XXXXX MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY OF THEIR
AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY
OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class
AF-4 Certificates) in that certain beneficial ownership interest evidenced by
all the Class AF-4 Certificates in the Trust Fund created pursuant to a Pooling
and Servicing Agreement, dated as specified above (the "Agreement"), among
Xxxxxxx Xxxxx Mortgage Investors, Inc. (hereinafter called the "Depositor,"
which term includes any successor entity under the Agreement), Credit-Based
Asset Servicing and Securitization LLC (the "Sponsor"), the Servicer and the
Trustee, a summary of certain of the pertinent provisions of which is set forth
hereafter. To the extent not defined herein, the capitalized terms used herein
have the meanings assigned in the Agreement. This Certificate is issued under
and is subject to the terms, provisions and conditions of the Agreement, to
which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs or the Closing
Date in the case of the first Distribution Date (the "Record Date"), from funds
in the Distribution Account in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to the Holders of Class AF-4 Certificates on such Distribution Date pursuant to
the Agreement.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar in
writing at least five Business Days prior to the Record Date immediately prior
to such Distribution Date, or by check mailed by first class mail to the address
of the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
A-5-2
This Certificate is one of a duly authorized issue of Certificates
designated as Ownit Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class AF-4 Certificates.
The Class AF-4 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the Sponsor and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Sponsor and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Trustee as provided in the Agreement, duly
endorsed by, or accompanied by an assignment in the form below or other written
instrument of transfer in form satisfactory to the Trustee and the Certificate
Registrar duly executed by, the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations specified in the Agreement. As provided in
the Agreement and subject to certain limitations therein set forth, Certificates
are exchangeable for new Certificates of the same Class in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent nor any such agent shall be affected by notice to the contrary.
A-5-3
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
A-5-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: January 30, 2006
JPMORGAN CHASE BANK, N.A.,
as Trustee
By:
-----------------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
JPMORGAN CHASE BANK, N.A.,
as Certificate Registrar
By:
----------------------------------------
Authorized Signatory
Date of authentication: January 30, 2006
A-5-5
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
-------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right of
survivorship and not as tenants ___________________
in common (State)
Additional abbreviations may also be used though not in the above list.
A-5-6
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
--------------------------------------------------------------------------------
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _________________, account number ___________________, or, if
mailed by check, to ___________________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ____________________________________, as its agent.
X-0-0
XXXXXXX X-0
FORM OF CLASS B-1 CERTIFICATES
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A AND CLASS M
CERTIFICATES AS DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS BENEFICIAL
OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF
THE CODE AND CERTAIN OTHER PROPERTY.
OWNIT MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2006-1, CLASS B-1
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
XXXXXXX XXXXX MORTGAGE INVESTORS, INC.
Series 2006-1, Class B-1 Original Class Certificate Principal
Balance of the Class B-1 Certificates as
of the Closing Date: $13,774,000
Pass-Through Rate: 6.00(6)
Date of Pooling and Servicing Initial Certificate Principal Balance:
Agreement and Cut-off Date: $13,774,000
January 1, 2006
First Distribution Date: Servicer: Xxxxxx Loan Servicing LP
February 27, 2006
No. 1 Trustee: JPMorgan Chase Bank, N.A.
CUSIP: 69121P CS 0 Closing Date: January 30, 2006
---------------------
(6) Subject to a cap as described in the Agreement.
B-1-1
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN
THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXXXX
XXXXX MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY OF THEIR
AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY
OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class B-1
Certificates) in that certain beneficial ownership interest evidenced by all the
Class B-1 Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Xxxxxxx
Xxxxx Mortgage Investors, Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), Credit-Based Asset Servicing
and Securitization LLC (the "Sponsor"), the Servicer and the Trustee, a summary
of certain of the pertinent provisions of which is set forth hereafter. To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs (the "Record
Date"), from funds in the Distribution Account in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class B-1 Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar in
writing at least five Business Days prior to the Record Date immediately prior
to such Distribution Date, or by check mailed by first class mail to the address
of the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
B-1-2
This Certificate is one of a duly authorized issue of Certificates
designated as Ownit Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class B-1 Certificates.
The Class B-1 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This Certificate is subordinated in right of payment to the Class A and
Class M Certificates as described in the Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the Sponsor and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Sponsor and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Trustee as provided in the Agreement, duly
endorsed by, or accompanied by an assignment in the form below or other written
instrument of transfer in form satisfactory to the Trustee and the Certificate
Registrar duly executed by, the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations specified in the Agreement. As provided in
the Agreement and subject to certain limitations therein set forth, Certificates
are exchangeable for new Certificates of the same Class in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in connection with any transfer or exchange of Certificates.
B-1-3
The Depositor, the Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent nor any such agent shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
B-1-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: January 30, 2006
JPMORGAN CHASE BANK, N.A.,
as Trustee
By:
-----------------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
JPMORGAN CHASE BANK, N.A.,
as Certificate Registrar
By:
-----------------------------------------
Authorized Signatory
Date of authentication: January 30, 2006
B-1-5
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
-------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right of
survivorship and not as tenants ___________________
in common (State)
Additional abbreviations may also be used though not in the above list.
B-1-6
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
--------------------------------------------------------------------------------
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _________________, account number ___________________, or, if
mailed by check, to ___________________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ____________________________________, as its agent.
X-0-0
XXXXXXX X-0-0
FORM OF CLASS B-2 CERTIFICATES (144A)
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS BENEFICIAL
OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE") AND CERTAIN OTHER
PROPERTY.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXXXX
XXXXX MORTGAGE INVESTORS, INC. ("MLMI"), THE TRUSTEE OR ANY SERVICER REFERRED TO
BELOW OR ANY OF THEIR AFFILIATES. NEITHER THIS CERTIFICATE, THE REMIC REGULAR
INTEREST REPRESENTED HEREBY NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED OR
INSURED BY MLMI, THE TRUSTEE, ANY SERVICER OR BY ANY OF THEIR AFFILIATES OR BY
ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE PRINCIPAL BALANCE OF
THIS CERTIFICATE MAY BE DIFFERENT FROM THE ORIGINAL DENOMINATION SHOWN BELOW.
ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT PRINCIPAL BALANCE BY
INQUIRY OF THE TRUSTEE.
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "1933 ACT") OR ANY STATE SECURITIES LAWS. NEITHER THIS CERTIFICATE
NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION, UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
REGISTRATION.
THE HOLDER OF THIS CERTIFICATE BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR
OTHERWISE TRANSFER SUCH CERTIFICATE ONLY (A) PURSUANT TO A REGISTRATION
STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE 1933 ACT OR (B) TO A
PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN
RULE 144A UNDER THE 1933 ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, SUBJECT TO THE TRUSTEE'S RIGHT
PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER TO REQUIRE THE DELIVERY OF A
CERTIFICATE OF TRANSFER IN THE FORM APPEARING IN THE POOLING AND SERVICING
AGREEMENT.
B-2-1-1
OWNIT MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2006-1, CLASS B-2
(RULE 144A)
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
XXXXXXX XXXXX MORTGAGE INVESTORS, INC.
Series 2006-1, Class B-2 Original Class Certificate Principal
Balance of the Class B-2 Certificates as
of the Closing Date: $11,599,000
Pass-Through Rate: 6.00%(7)
Date of Pooling and Servicing Initial Certificate Principal Balance:
Agreement and Cut-off Date: $11,599,000
January 1, 2006
First Distribution Date: Servicer: Xxxxxx Loan Servicing LP
February 27, 2006
No. 1 Trustee: JPMorgan Chase Bank, N.A.
CUSIP: 69121P CT 8 Closing Date: January 30, 2006
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN
THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXXXX
XXXXX MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY OF THEIR
AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY
OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class B-2
Certificates) in that certain beneficial ownership interest evidenced by all the
Class B-2 Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Xxxxxxx
Xxxxx Mortgage Investors, Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), Credit-Based Asset Servicing
and Securitization LLC (the "Sponsor"), the Servicer and the Trustee, a summary
of certain of the pertinent provisions of which is set forth hereafter. To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
-----------------------
(7) Subject to a cap as described in the Agreement
B-2-1-2
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs (the "Record
Date"), from funds in the Distribution Account in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class B-2 Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar in
writing at least five Business Days prior to the Record Date immediately prior
to such Distribution Date, or by check mailed by first class mail to the address
of the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Ownit Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class B-2 Certificates.
The Class B-2 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This Certificate is subordinated in right of payment to the Class A,
Class M and Class B-1 Certificates as described in the Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the Sponsor and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Sponsor and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.
B-2-1-3
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Trustee as provided in the Agreement, duly
endorsed by, or accompanied by an assignment in the form below or other written
instrument of transfer in form satisfactory to the Trustee and the Certificate
Registrar duly executed by, the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations specified in the Agreement. As provided in
the Agreement and subject to certain limitations therein set forth, Certificates
are exchangeable for new Certificates of the same Class in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
No transfer of this Certificate shall be made unless that transfer is
made pursuant to an effective registration statement under the 1933 Act and
effective registration or qualification under applicable state securities laws,
or is made in a transaction that does not require such registration or
qualification. In the event that a transfer is to be made without registration
or qualification (i) the Certificateholder desiring to effect the transfer and
such Certificateholder's prospective transferee shall each execute a
representation letter in the form described by the Agreement certifying to the
Certificate Registrar the facts surrounding the transfer, and (ii) unless such
transfer is made in reliance upon Rule 144A under the 1933 Act, the Depositor
and the Certificate Registrar may require an Opinion of Counsel satisfactory to
them that such transfer may be made without such registration or qualification,
which Opinion of Counsel shall not be an expense of the Depositor, the Trustee
or the Certificate Registrar, in their respective capacities as such. None of
the Depositor, the Certificate Registrar or the Trustee is obligated to register
or qualify the Class of Certificates specified on the face hereof under the 1933
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of such Certificates without
registration or qualification. Any such Certificateholder desiring to effect
such transfer shall, and does hereby agree to, indemnify the Trustee, the
Depositor, the Certificate Registrar and the Servicer against any liability that
may result if the transfer is not so exempt or is not made in accordance with
such federal and state laws. Each Person who acquires this Certificate or an
interest therein shall be deemed to have made the representations required by
the representation letter referred to in this paragraph, unless such Person
shall have provided such representation letter referred to in this paragraph to
the Certificate Registrar.
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in connection with any transfer or exchange of Certificates.
B-2-1-4
The Depositor, the Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent nor any such agent shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
B-2-1-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: January 30, 2006
JPMORGAN CHASE BANK, N.A.
as Trustee
By:
-----------------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
JPMORGAN CHASE BANK, N.A.
as Certificate Registrar
By:
-----------------------------------------
Authorized Signatory
Date of authentication: January 30, 2006
B-2-1-6
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
-------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform
Gifts to Minors Act
JT TEN - as joint tenants with right of
survivorship and not as tenants -------------------
in common (State)
Additional abbreviations may also be used though not in the above list.
B-2-1-7
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
--------------------------------------------------------------------------------
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _________________, account number ___________________, or, if
mailed by check, to ___________________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ____________________________________, as its agent.
X-0-0-0
XXXXXXX X-0-0
FORM OF CLASS B-2 CERTIFICATES (S)
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS BENEFICIAL
OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE") AND CERTAIN OTHER
PROPERTY.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXXXX
XXXXX MORTGAGE INVESTORS, INC. ("MLMI"), THE TRUSTEE OR ANY SERVICER REFERRED TO
BELOW OR ANY OF THEIR AFFILIATES. NEITHER THIS CERTIFICATE, THE REMIC REGULAR
INTEREST REPRESENTED HEREBY NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED OR
INSURED BY MLMI, THE TRUSTEE, ANY SERVICER OR BY ANY OF THEIR AFFILIATES OR BY
ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE PRINCIPAL BALANCE OF
THIS CERTIFICATE MAY BE DIFFERENT FROM THE ORIGINAL DENOMINATION SHOWN BELOW.
ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT PRINCIPAL BALANCE BY
INQUIRY OF THE TRUSTEE.
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "1933 ACT") OR ANY STATE SECURITIES LAWS. NEITHER THIS CERTIFICATE
NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF WITHIN THE UNITED
STATES (AS DEFINED IN RULES 901 THROUGH 905 OF THE 1933 ACT ("REGULATION S")) OR
TO, OR FOR THE ACCOUNT OR BENEFIT OF, A U.S. PERSON (AS DEFINED IN REGULATION
S), IN THE ABSENCE OF SUCH REGISTRATION, UNLESS SUCH TRANSACTION IS EXEMPT FROM,
OR NOT SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS CERTIFICATE BY ITS ACCEPTANCE HEREOF AGREES (A) THAT, UNTIL
THE EXPIRATION OF THE APPLICABLE "DISTRIBUTION COMPLIANCE PERIOD" WITHIN THE
MEANING OF REGULATION S, ANY OFFER, SALE, PLEDGE OR OTHER TRANSFER OF THIS
CERTIFICATE SHALL NOT BE MADE IN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR
BENEFIT OF, ANY U.S. PERSON (EACH AS DEFINED IN REGULATION S) AND (B) TO OFFER,
SELL, PLEDGE OR OTHERWISE TRANSFER THIS CERTIFICATE WITHIN THE UNITED STATES OR
TO, OR FOR THE ACCOUNT OR BENEFIT OF, A U.S. PERSON (EACH AS DEFINED IN
REGULATION S) ONLY (1) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN
DECLARED EFFECTIVE UNDER THE 1933 ACT OR (2) TO A PERSON IT REASONABLY BELIEVES
IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE 1933 ACT
THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A, SUBJECT TO THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER,
SALE OR TRANSFER TO REQUIRE THE DELIVERY OF A CERTIFICATE OF TRANSFER IN THE
FORM APPEARING IN THE POOLING AND SERVICING AGREEMENT.
B-2-2-1
OWNIT MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2006-1, CLASS B-2
(REGULATION S)
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
XXXXXXX XXXXX MORTGAGE INVESTORS, INC.
Series 2006-1, Class B-2 Original Class Certificate Principal
Balance of the Class B-2 Certificates as
of the Closing Date: $11,599,000
Pass-Through Rate: 6.00%(8)
Date of Pooling and Servicing Initial Certificate Principal Balance:
Agreement and Cut-off Date: $0
January 1, 2006
First Distribution Date: Servicer: Xxxxxx Loan Servicing LP
February 27, 2006
No. 1 Trustee: JPMorgan Chase Bank, N.A.
CUSIP: [________] Closing Date: January 30, 2006
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN
THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXXXX
XXXXX MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY OF THEIR
AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY
OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class B-2
Certificates) in that certain beneficial ownership interest evidenced by all the
Class B-2 Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Xxxxxxx
Xxxxx Mortgage Investors, Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), Credit-Based Asset Servicing
and Securitization LLC (the "Sponsor"), the Servicer and the Trustee, a summary
of certain of the pertinent provisions of which is set forth hereafter. To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
------------------------
(8) Subject to a cap as described in the Agreement,
B-2-2-2
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs (the "Record
Date"), from funds in the Distribution Account in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class B-2 Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar in
writing at least five Business Days prior to the Record Date immediately prior
to such Distribution Date, or by check mailed by first class mail to the address
of the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Ownit Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class B-2 Certificates.
The Class B-2 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This Certificate is subordinated in right of payment to the Class A,
Class M and Class B-1 Certificates as described in the Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the Sponsor and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Sponsor and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.
B-2-2-3
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Trustee as provided in the Agreement, duly
endorsed by, or accompanied by an assignment in the form below or other written
instrument of transfer in form satisfactory to the Trustee and the Certificate
Registrar duly executed by, the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations specified in the Agreement. As provided in
the Agreement and subject to certain limitations therein set forth, Certificates
are exchangeable for new Certificates of the same Class in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
No transfer of this Certificate shall be made unless that transfer is
made pursuant to an effective registration statement under the 1933 Act and
effective registration or qualification under applicable state securities laws,
or is made in a transaction that does not require such registration or
qualification. In the event that a transfer is to be made without registration
or qualification (i) the Certificateholder desiring to effect the transfer and
such Certificateholder's prospective transferee shall each execute a
representation letter in the form described by the Agreement certifying to the
Certificate Registrar the facts surrounding the transfer, and (ii) unless such
transfer is made in reliance upon Rule 144A under the 1933 Act, the Depositor
and the Certificate Registrar may require an Opinion of Counsel satisfactory to
them that such transfer may be made without such registration or qualification,
which Opinion of Counsel shall not be an expense of the Depositor, the Trustee
or the Certificate Registrar, in their respective capacities as such. None of
the Depositor, the Certificate Registrar or the Trustee is obligated to register
or qualify the Class of Certificates specified on the face hereof under the 1933
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of such Certificates without
registration or qualification. Any such Certificateholder desiring to effect
such transfer shall, and does hereby agree to, indemnify the Trustee, the
Depositor, the Certificate Registrar and the Servicer against any liability that
may result if the transfer is not so exempt or is not made in accordance with
such federal and state laws. Each Person who acquires this Certificate or an
interest therein shall be deemed to have made the representations required by
the representation letter referred to in this paragraph, unless such Person
shall have provided such representation letter referred to in this paragraph to
the Certificate Registrar.
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in connection with any transfer or exchange of Certificates.
B-2-2-4
The Depositor, the Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent nor any such agent shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
B-2-2-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: January 30, 2006
JPMORGAN CHASE BANK, N.A.
as Trustee
By:
------------------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
JPMORGAN CHASE BANK, N.A.
as Certificate Registrar
By:
------------------------------------------
Authorized Signatory
Date of authentication: January 30, 2006
B-2-2-6
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
-------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform
Gifts to Minors Act
JT TEN - as joint tenants with right of
survivorship and not as tenants -------------------
in common (State)
Additional abbreviations may also be used though not in the above list.
B-2-2-7
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
--------------------------------------------------------------------------------
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _________________, account number ___________________, or, if
mailed by check, to ___________________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ____________________________________, as its agent.
X-0-0-0
XXXXXXX X-0-0
FORM OF CLASS B-3 CERTIFICATES (144A)
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS BENEFICIAL
OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE") AND CERTAIN OTHER
PROPERTY.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXXXX
XXXXX MORTGAGE INVESTORS, INC. ("MLMI"), THE TRUSTEE OR ANY SERVICER REFERRED TO
BELOW OR ANY OF THEIR AFFILIATES. NEITHER THIS CERTIFICATE, THE REMIC REGULAR
INTEREST REPRESENTED HEREBY NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED OR
INSURED BY MLMI, THE TRUSTEE, ANY SERVICER OR BY ANY OF THEIR AFFILIATES OR BY
ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE PRINCIPAL BALANCE OF
THIS CERTIFICATE MAY BE DIFFERENT FROM THE ORIGINAL DENOMINATION SHOWN BELOW.
ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT PRINCIPAL BALANCE BY
INQUIRY OF THE TRUSTEE.
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "1933 ACT") OR ANY STATE SECURITIES LAWS. NEITHER THIS CERTIFICATE
NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION, UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
REGISTRATION.
THE HOLDER OF THIS CERTIFICATE BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR
OTHERWISE TRANSFER SUCH CERTIFICATE ONLY (A) PURSUANT TO A REGISTRATION
STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE 1933 ACT OR (B) TO A
PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN
RULE 144A UNDER THE 1933 ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, SUBJECT TO THE TRUSTEE'S RIGHT
PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER TO REQUIRE THE DELIVERY OF A
CERTIFICATE OF TRANSFER IN THE FORM APPEARING IN THE POOLING AND SERVICING
AGREEMENT.
B-3-1-1
OWNIT MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2006-1, CLASS B-3
(RULE 144A)
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
XXXXXXX XXXXX MORTGAGE INVESTORS, INC.
Series 2006-1, Class B-3 Original Class Certificate Principal
Balance of the Class B-3 Certificates as
of the Closing Date: $7,612,000
Pass-Through Rate: 6.00%(9)
Date of Pooling and Servicing Initial Certificate Principal Balance:
Agreement and Cut-off Date: $7,612,000
January 1, 2006
First Distribution Date: Servicer: Xxxxxx Loan Servicing LP
February 27, 2006
No. 1 Trustee: JPMorgan Chase Bank, N.A.
CUSIP: 69121P CU 5 Closing Date: January 30, 2006
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN
THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXXXX
XXXXX MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY OF THEIR
AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY
OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class B-3
Certificates) in that certain beneficial ownership interest evidenced by all the
Class B-3 Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Xxxxxxx
Xxxxx Mortgage Investors, Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), Credit-Based Asset Servicing
and Securitization LLC (the "Sponsor"), the Servicer and the Trustee, a summary
of certain of the pertinent provisions of which is set forth hereafter. To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
---------------------
(9) Subject to a cap as described in the Agreement
B-3-1-2
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs (the "Record
Date"), from funds in the Distribution Account in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class B-3 Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar in
writing at least five Business Days prior to the Record Date immediately prior
to such Distribution Date, or by check mailed by first class mail to the address
of the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Ownit Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class B-3 Certificates.
The Class B-3 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This Certificate is subordinated in right of payment to the Class A,
Class M, Class B-1 and Class B-2 Certificates as described in the Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the Sponsor and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Sponsor and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.
B-3-1-3
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Trustee as provided in the Agreement, duly
endorsed by, or accompanied by an assignment in the form below or other written
instrument of transfer in form satisfactory to the Trustee and the Certificate
Registrar duly executed by, the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations specified in the Agreement. As provided in
the Agreement and subject to certain limitations therein set forth, Certificates
are exchangeable for new Certificates of the same Class in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
No transfer of this Certificate shall be made unless that transfer is
made pursuant to an effective registration statement under the 1933 Act and
effective registration or qualification under applicable state securities laws,
or is made in a transaction that does not require such registration or
qualification. In the event that a transfer is to be made without registration
or qualification (i) the Certificateholder desiring to effect the transfer and
such Certificateholder's prospective transferee shall each execute a
representation letter in the form described by the Agreement certifying to the
Certificate Registrar the facts surrounding the transfer, and (ii) unless such
transfer is made in reliance upon Rule 144A under the 1933 Act, the Depositor
and the Certificate Registrar may require an Opinion of Counsel satisfactory to
them that such transfer may be made without such registration or qualification,
which Opinion of Counsel shall not be an expense of the Depositor, the Trustee
or the Certificate Registrar, in their respective capacities as such. None of
the Depositor, the Certificate Registrar or the Trustee is obligated to register
or qualify the Class of Certificates specified on the face hereof under the 1933
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of such Certificates without
registration or qualification. Any such Certificateholder desiring to effect
such transfer shall, and does hereby agree to, indemnify the Trustee, the
Depositor, the Certificate Registrar and the Servicer against any liability that
may result if the transfer is not so exempt or is not made in accordance with
such federal and state laws. Each Person who acquires this Certificate or an
interest therein shall be deemed to have made the representations required by
the representation letter referred to in this paragraph, unless such Person
shall have provided such representation letter referred to in this paragraph to
the Certificate Registrar.
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in connection with any transfer or exchange of Certificates.
B-3-1-4
The Depositor, the Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent nor any such agent shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
B-3-1-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: January 30, 2006
JPMORGAN CHASE BANK, N.A.
as Trustee
By:
---------------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
JPMORGAN CHASE BANK, N.A.
as Certificate Registrar
By:
---------------------------------------
Authorized Signatory
Date of authentication: January 30, 2006
B-3-1-6
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
-------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts
to Minors Act
JT TEN - as joint tenants with right of
survivorship and not as tenants -------------------
in common (State)
Additional abbreviations may also be used though not in the above list.
B-3-1-7
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
--------------------------------------------------------------------------------
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _________________, account number ___________________, or, if
mailed by check, to ___________________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ____________________________________, as its agent.
X-0-0-0
XXXXXXX X-0-0
FORM OF CLASS B-3 CERTIFICATES (REGULATION S)
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS BENEFICIAL
OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE") AND CERTAIN OTHER
PROPERTY.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXXXX
XXXXX MORTGAGE INVESTORS, INC. ("MLMI"), THE TRUSTEE OR ANY SERVICER REFERRED TO
BELOW OR ANY OF THEIR AFFILIATES. NEITHER THIS CERTIFICATE, THE REMIC REGULAR
INTEREST REPRESENTED HEREBY NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED OR
INSURED BY MLMI, THE TRUSTEE, ANY SERVICER OR BY ANY OF THEIR AFFILIATES OR BY
ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE PRINCIPAL BALANCE OF
THIS CERTIFICATE MAY BE DIFFERENT FROM THE ORIGINAL DENOMINATION SHOWN BELOW.
ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT PRINCIPAL BALANCE BY
INQUIRY OF THE TRUSTEE.
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "1933 ACT") OR ANY STATE SECURITIES LAWS. NEITHER THIS CERTIFICATE
NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF WITHIN THE UNITED
STATES (AS DEFINED IN RULES 901 THROUGH 905 OF THE 1933 ACT ("REGULATION S")) OR
TO, OR FOR THE ACCOUNT OR BENEFIT OF, A U.S. PERSON (AS DEFINED IN REGULATION
S), IN THE ABSENCE OF SUCH REGISTRATION, UNLESS SUCH TRANSACTION IS EXEMPT FROM,
OR NOT SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS CERTIFICATE BY ITS ACCEPTANCE HEREOF AGREES (A) THAT, UNTIL
THE EXPIRATION OF THE APPLICABLE "DISTRIBUTION COMPLIANCE PERIOD" WITHIN THE
MEANING OF REGULATION S, ANY OFFER, SALE, PLEDGE OR OTHER TRANSFER OF THIS
CERTIFICATE SHALL NOT BE MADE IN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR
BENEFIT OF, ANY U.S. PERSON (EACH AS DEFINED IN REGULATION S) AND (B) TO OFFER,
SELL, PLEDGE OR OTHERWISE TRANSFER THIS CERTIFICATE WITHIN THE UNITED STATES OR
TO, OR FOR THE ACCOUNT OR BENEFIT OF, A U.S. PERSON (EACH AS DEFINED IN
REGULATION S) ONLY (1) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN
DECLARED EFFECTIVE UNDER THE 1933 ACT OR (2) TO A PERSON IT REASONABLY BELIEVES
IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE 1933 ACT
THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A, SUBJECT TO THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER,
SALE OR TRANSFER TO REQUIRE THE DELIVERY OF A CERTIFICATE OF TRANSFER IN THE
FORM APPEARING IN THE POOLING AND SERVICING AGREEMENT.
B-3-2-1
OWNIT MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2006-1, CLASS B-3
(REGULATION S)
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
XXXXXXX XXXXX MORTGAGE INVESTORS, INC.
Series 2006-1, Class B-3 Original Class Certificate Principal
Balance of the Class B-3 Certificates as
of the Closing Date: $7,612,000
Pass-Through Rate: 6.00%(10)
Date of Pooling and Servicing Initial Certificate Principal Balance:
Agreement and Cut-off Date: $0
January 1, 2006
First Distribution Date: Servicer: Xxxxxx Loan Servicing LP
February 27, 2006
No. 1 Trustee: JPMorgan Chase Bank, N.A.
CUSIP: [________] Closing Date: January 30, 2006
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN
THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXXXX
XXXXX MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY OF THEIR
AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY
OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class B-3
Certificates) in that certain beneficial ownership interest evidenced by all the
Class B-3 Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Xxxxxxx
Xxxxx Mortgage Investors, Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), Credit-Based Asset Servicing
and Securitization LLC (the "Sponsor"), the Servicer and the Trustee, a summary
of certain of the pertinent provisions of which is set forth hereafter. To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
-------------------
(10) Subject to a cap as described in the Agreement,
B-3-2-2
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs (the "Record
Date"), from funds in the Distribution Account in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class B-3 Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar in
writing at least five Business Days prior to the Record Date immediately prior
to such Distribution Date, or by check mailed by first class mail to the address
of the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Ownit Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class B-3 Certificates.
The Class B-3 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This Certificate is subordinated in right of payment to the Class A,
Class M, Class B-1 and Class B-2 Certificates as described in the Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the Sponsor and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Sponsor and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.
B-3-2-3
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Trustee as provided in the Agreement, duly
endorsed by, or accompanied by an assignment in the form below or other written
instrument of transfer in form satisfactory to the Trustee and the Certificate
Registrar duly executed by, the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations specified in the Agreement. As provided in
the Agreement and subject to certain limitations therein set forth, Certificates
are exchangeable for new Certificates of the same Class in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
No transfer of this Certificate shall be made unless that transfer is
made pursuant to an effective registration statement under the 1933 Act and
effective registration or qualification under applicable state securities laws,
or is made in a transaction that does not require such registration or
qualification. In the event that a transfer is to be made without registration
or qualification (i) the Certificateholder desiring to effect the transfer and
such Certificateholder's prospective transferee shall each execute a
representation letter in the form described by the Agreement certifying to the
Certificate Registrar the facts surrounding the transfer, and (ii) unless such
transfer is made in reliance upon Rule 144A under the 1933 Act, the Depositor
and the Certificate Registrar may require an Opinion of Counsel satisfactory to
them that such transfer may be made without such registration or qualification,
which Opinion of Counsel shall not be an expense of the Depositor, the Trustee
or the Certificate Registrar, in their respective capacities as such. None of
the Depositor, the Certificate Registrar or the Trustee is obligated to register
or qualify the Class of Certificates specified on the face hereof under the 1933
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of such Certificates without
registration or qualification. Any such Certificateholder desiring to effect
such transfer shall, and does hereby agree to, indemnify the Trustee, the
Depositor, the Certificate Registrar and the Servicer against any liability that
may result if the transfer is not so exempt or is not made in accordance with
such federal and state laws. Each Person who acquires this Certificate or an
interest therein shall be deemed to have made the representations required by
the representation letter referred to in this paragraph, unless such Person
shall have provided such representation letter referred to in this paragraph to
the Certificate Registrar.
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in connection with any transfer or exchange of Certificates.
B-3-2-4
The Depositor, the Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent nor any such agent shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
B-3-2-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: January 30, 2006
JPMORGAN CHASE BANK, N.A.
as Trustee
By:
----------------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
JPMORGAN CHASE BANK, N.A.
as Certificate Registrar
By:
----------------------------------------
Authorized Signatory
Date of authentication: January 30, 2006
B-3-2-6
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
-------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform
Gifts to Minors Act
JT TEN - as joint tenants with right of
survivorship and not as tenants -------------------
in common (State)
Additional abbreviations may also be used though not in
the above list.
B-3-2-7
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
--------------------------------------------------------------------------------
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _________________, account number ___________________, or, if
mailed by check, to ___________________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ____________________________________, as its agent.
X-0-0-0
XXXXXXX X-0-0
FORM OF CLASS B-4 CERTIFICATES (144A)
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS BENEFICIAL
OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE") AND CERTAIN OTHER
PROPERTY.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXXXX
XXXXX MORTGAGE INVESTORS, INC. ("MLMI"), THE TRUSTEE OR ANY SERVICER REFERRED TO
BELOW OR ANY OF THEIR AFFILIATES. NEITHER THIS CERTIFICATE, THE REMIC REGULAR
INTEREST REPRESENTED HEREBY NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED OR
INSURED BY MLMI, THE TRUSTEE, ANY SERVICER OR BY ANY OF THEIR AFFILIATES OR BY
ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE PRINCIPAL BALANCE OF
THIS CERTIFICATE MAY BE DIFFERENT FROM THE ORIGINAL DENOMINATION SHOWN BELOW.
ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT PRINCIPAL BALANCE BY
INQUIRY OF THE TRUSTEE.
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "1933 ACT") OR ANY STATE SECURITIES LAWS. NEITHER THIS CERTIFICATE
NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION, UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
REGISTRATION.
THE HOLDER OF THIS CERTIFICATE BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR
OTHERWISE TRANSFER SUCH CERTIFICATE ONLY (A) PURSUANT TO A REGISTRATION
STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE 1933 ACT OR (B) TO A
PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN
RULE 144A UNDER THE 1933 ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, SUBJECT TO THE TRUSTEE'S RIGHT
PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER TO REQUIRE THE DELIVERY OF A
CERTIFICATE OF TRANSFER IN THE FORM APPEARING IN THE POOLING AND SERVICING
AGREEMENT.
B-4-1-1
OWNIT MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2006-1, CLASS B-4
(RULE 144A)
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
XXXXXXX XXXXX MORTGAGE INVESTORS, INC.
Series 2006-1, Class B-4 Original Class Certificate Principal
Balance of the Class B-4 Certificates as
of the Closing Date: $6,887,000
Pass-Through Rate: 6.00%(11)
Date of Pooling and Servicing Initial Certificate Principal Balance:
Agreement and Cut-off Date: $6,887,000
January 1, 2006
First Distribution Date: Servicer: Xxxxxx Loan Servicing LP
February 27, 2006
No. 1 Trustee: JPMorgan Chase Bank, N.A.
CUSIP: 69121P CV 3 Closing Date: January 30, 2006
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN
THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXXXX
XXXXX MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY OF THEIR
AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY
OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class B-4
Certificates) in that certain beneficial ownership interest evidenced by all the
Class B-4 Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Xxxxxxx
Xxxxx Mortgage Investors, Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), Credit-Based Asset Servicing
and Securitization LLC (the "Sponsor"), the Servicer and the Trustee, a summary
of certain of the pertinent provisions of which is set forth hereafter. To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
-----------------
(11) Suject to a cap as described in Agreement
B-4-1-2
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs (the "Record
Date"), from funds in the Distribution Account in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class B-4 Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar in
writing at least five Business Days prior to the Record Date immediately prior
to such Distribution Date, or by check mailed by first class mail to the address
of the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Ownit Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class B-4 Certificates.
The Class B-4 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This Certificate is subordinated in right of payment to the Class A,
Class M, Class B-1, Class B-2 and Class B-3 Certificates as described in the
Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the Sponsor and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Sponsor and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.
B-4-1-3
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Trustee as provided in the Agreement, duly
endorsed by, or accompanied by an assignment in the form below or other written
instrument of transfer in form satisfactory to the Trustee and the Certificate
Registrar duly executed by, the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations specified in the Agreement. As provided in
the Agreement and subject to certain limitations therein set forth, Certificates
are exchangeable for new Certificates of the same Class in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
No transfer of this Certificate shall be made unless that transfer is
made pursuant to an effective registration statement under the 1933 Act and
effective registration or qualification under applicable state securities laws,
or is made in a transaction that does not require such registration or
qualification. In the event that a transfer is to be made without registration
or qualification (i) the Certificateholder desiring to effect the transfer and
such Certificateholder's prospective transferee shall each execute a
representation letter in the form described by the Agreement certifying to the
Certificate Registrar the facts surrounding the transfer, and (ii) unless such
transfer is made in reliance upon Rule 144A under the 1933 Act, the Depositor
and the Certificate Registrar may require an Opinion of Counsel satisfactory to
them that such transfer may be made without such registration or qualification,
which Opinion of Counsel shall not be an expense of the Depositor, the Trustee
or the Certificate Registrar, in their respective capacities as such. None of
the Depositor, the Certificate Registrar or the Trustee is obligated to register
or qualify the Class of Certificates specified on the face hereof under the 1933
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of such Certificates without
registration or qualification. Any such Certificateholder desiring to effect
such transfer shall, and does hereby agree to, indemnify the Trustee, the
Depositor, the Certificate Registrar and the Servicer against any liability that
may result if the transfer is not so exempt or is not made in accordance with
such federal and state laws. Each Person who acquires this Certificate or an
interest therein shall be deemed to have made the representations required by
the representation letter referred to in this paragraph, unless such Person
shall have provided such representation letter referred to in this paragraph to
the Certificate Registrar.
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in connection with any transfer or exchange of Certificates.
B-4-1-4
The Depositor, the Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent nor any such agent shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
B-4-1-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: January 30, 2006
JPMORGAN CHASE BANK, N.A.
as Trustee
By:
-----------------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
JPMORGAN CHASE BANK, N.A.
as Certificate Registrar
By:
-----------------------------------------
Authorized Signatory
Date of authentication: January 30, 2006
B-4-1-6
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
-------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform
Gifts to Minors Act
JT TEN - as joint tenants with right of
survivorship and not as tenants ------------------
in common (State)
Additional abbreviations may also be used though not in the above list.
B-4-1-7
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
--------------------------------------------------------------------------------
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _________________, account number ___________________, or, if
mailed by check, to ___________________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ____________________________________, as its agent.
X-0-0-0
XXXXXXX X-0-0
FORM OF CLASS B-4 CERTIFICATES (REGULATION S)
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS BENEFICIAL
OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE") AND CERTAIN OTHER
PROPERTY.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXXXX
XXXXX MORTGAGE INVESTORS, INC. ("MLMI"), THE TRUSTEE OR ANY SERVICER REFERRED TO
BELOW OR ANY OF THEIR AFFILIATES. NEITHER THIS CERTIFICATE, THE REMIC REGULAR
INTEREST REPRESENTED HEREBY NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED OR
INSURED BY MLMI, THE TRUSTEE, ANY SERVICER OR BY ANY OF THEIR AFFILIATES OR BY
ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE PRINCIPAL BALANCE OF
THIS CERTIFICATE MAY BE DIFFERENT FROM THE ORIGINAL DENOMINATION SHOWN BELOW.
ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT PRINCIPAL BALANCE BY
INQUIRY OF THE TRUSTEE.
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "1933 ACT") OR ANY STATE SECURITIES LAWS. NEITHER THIS CERTIFICATE
NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF WITHIN THE UNITED
STATES (AS DEFINED IN RULES 901 THROUGH 905 OF THE 1933 ACT ("REGULATION S")) OR
TO, OR FOR THE ACCOUNT OR BENEFIT OF, A U.S. PERSON (AS DEFINED IN REGULATION
S), IN THE ABSENCE OF SUCH REGISTRATION, UNLESS SUCH TRANSACTION IS EXEMPT FROM,
OR NOT SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS CERTIFICATE BY ITS ACCEPTANCE HEREOF AGREES (A) THAT, UNTIL
THE EXPIRATION OF THE APPLICABLE "DISTRIBUTION COMPLIANCE PERIOD" WITHIN THE
MEANING OF REGULATION S, ANY OFFER, SALE, PLEDGE OR OTHER TRANSFER OF THIS
CERTIFICATE SHALL NOT BE MADE IN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR
BENEFIT OF, ANY U.S. PERSON (EACH AS DEFINED IN REGULATION S) AND (B) TO OFFER,
SELL, PLEDGE OR OTHERWISE TRANSFER THIS CERTIFICATE WITHIN THE UNITED STATES OR
TO, OR FOR THE ACCOUNT OR BENEFIT OF, A U.S. PERSON (EACH AS DEFINED IN
REGULATION S) ONLY (1) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN
DECLARED EFFECTIVE UNDER THE 1933 ACT OR (2) TO A PERSON IT REASONABLY BELIEVES
IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE 1933 ACT
THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A, SUBJECT TO THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER,
SALE OR TRANSFER TO REQUIRE THE DELIVERY OF A CERTIFICATE OF TRANSFER IN THE
FORM APPEARING IN THE POOLING AND SERVICING AGREEMENT.
B-4-2-1
OWNIT MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2006-1, CLASS B-4
(REGULATION S)
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
XXXXXXX XXXXX MORTGAGE INVESTORS, INC.
Series 2006-1, Class B-4 Original Class Certificate Principal
Balance of the Class B-4 Certificates as
of the Closing Date: $6,887,000
Pass-Through Rate: 6.00%(12)
Date of Pooling and Servicing Initial Certificate Principal Balance:
Agreement and Cut-off Date: $0
January 1, 2006
First Distribution Date: Servicer: Xxxxxx Loan Servicing LP
February 27, 2006
No. 1 Trustee: JPMorgan Chase Bank, N.A.
CUSIP: [________] Closing Date: January 30, 2006
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN
THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXXXX
XXXXX MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY OF THEIR
AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY
OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class B-4
Certificates) in that certain beneficial ownership interest evidenced by all the
Class B-4 Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Xxxxxxx
Xxxxx Mortgage Investors, Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), Credit-Based Asset Servicing
and Securitization LLC (the "Sponsor"), the Servicer and the Trustee, a summary
of certain of the pertinent provisions of which is set forth hereafter. To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
--------------------------
(12) Subject to a cap as described in the Agreement,
B-4-2-2
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs (the "Record
Date"), from funds in the Distribution Account in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class B-4 Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar in
writing at least five Business Days prior to the Record Date immediately prior
to such Distribution Date, or by check mailed by first class mail to the address
of the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Ownit Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class B-4 Certificates.
The Class B-4 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This Certificate is subordinated in right of payment to the Class A,
Class M, Class B-1 Class B-2 and Class B-3 Certificates as described in the
Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the Sponsor and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Sponsor and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.
B-4-2-3
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Trustee as provided in the Agreement, duly
endorsed by, or accompanied by an assignment in the form below or other written
instrument of transfer in form satisfactory to the Trustee and the Certificate
Registrar duly executed by, the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations specified in the Agreement. As provided in
the Agreement and subject to certain limitations therein set forth, Certificates
are exchangeable for new Certificates of the same Class in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
No transfer of this Certificate shall be made unless that transfer is
made pursuant to an effective registration statement under the 1933 Act and
effective registration or qualification under applicable state securities laws,
or is made in a transaction that does not require such registration or
qualification. In the event that a transfer is to be made without registration
or qualification (i) the Certificateholder desiring to effect the transfer and
such Certificateholder's prospective transferee shall each execute a
representation letter in the form described by the Agreement certifying to the
Certificate Registrar the facts surrounding the transfer, and (ii) unless such
transfer is made in reliance upon Rule 144A under the 1933 Act, the Depositor
and the Certificate Registrar may require an Opinion of Counsel satisfactory to
them that such transfer may be made without such registration or qualification,
which Opinion of Counsel shall not be an expense of the Depositor, the Trustee
or the Certificate Registrar, in their respective capacities as such. None of
the Depositor, the Certificate Registrar or the Trustee is obligated to register
or qualify the Class of Certificates specified on the face hereof under the 1933
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of such Certificates without
registration or qualification. Any such Certificateholder desiring to effect
such transfer shall, and does hereby agree to, indemnify the Trustee, the
Depositor, the Certificate Registrar and the Servicer against any liability that
may result if the transfer is not so exempt or is not made in accordance with
such federal and state laws. Each Person who acquires this Certificate or an
interest therein shall be deemed to have made the representations required by
the representation letter referred to in this paragraph, unless such Person
shall have provided such representation letter referred to in this paragraph to
the Certificate Registrar.
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in connection with any transfer or exchange of Certificates.
B-4-2-4
The Depositor, the Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent nor any such agent shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
B-4-2-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: January 30, 2006
JPMORGAN CHASE BANK, N.A.
as Trustee
By:
---------------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
JPMORGAN CHASE BANK, N.A.
as Certificate Registrar
By:
---------------------------------------
Authorized Signatory
Date of authentication: January 30, 2006
B-4-2-6
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
-------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform
Gifts to Minors Act
JT TEN - as joint tenants with right of
survivorship and not as tenants -------------------
in common (State)
Additional abbreviations may also be used though not in the above list.
B-4-2-7
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
--------------------------------------------------------------------------------
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _________________, account number ___________________, or, if
mailed by check, to ___________________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ____________________________________, as its agent.
X-0-0-0
XXXXXXX X-0-0
FORM OF CLASS B-5 CERTIFICATES (144A)
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS BENEFICIAL
OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE") AND CERTAIN OTHER
PROPERTY.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXXXX
XXXXX MORTGAGE INVESTORS, INC. ("MLMI"), THE TRUSTEE OR ANY SERVICER REFERRED TO
BELOW OR ANY OF THEIR AFFILIATES. NEITHER THIS CERTIFICATE, THE REMIC REGULAR
INTEREST REPRESENTED HEREBY NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED OR
INSURED BY MLMI, THE TRUSTEE, ANY SERVICER OR BY ANY OF THEIR AFFILIATES OR BY
ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE PRINCIPAL BALANCE OF
THIS CERTIFICATE MAY BE DIFFERENT FROM THE ORIGINAL DENOMINATION SHOWN BELOW.
ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT PRINCIPAL BALANCE BY
INQUIRY OF THE TRUSTEE.
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "1933 ACT") OR ANY STATE SECURITIES LAWS. NEITHER THIS CERTIFICATE
NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION, UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
REGISTRATION.
THE HOLDER OF THIS CERTIFICATE BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR
OTHERWISE TRANSFER SUCH CERTIFICATE ONLY (A) PURSUANT TO A REGISTRATION
STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE 1933 ACT OR (B) TO A
PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN
RULE 144A UNDER THE 1933 ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, SUBJECT TO THE TRUSTEE'S RIGHT
PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER TO REQUIRE THE DELIVERY OF A
CERTIFICATE OF TRANSFER IN THE FORM APPEARING IN THE POOLING AND SERVICING
AGREEMENT.
B-5-1-1
OWNIT MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2006-1, CLASS B-5
(RULE 144A)
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
XXXXXXX XXXXX MORTGAGE INVESTORS, INC.
Series 2006-1, Class B-5 Original Class Certificate Principal
Balance of the Class B-5 Certificates as
of the Closing Date: $7,249,000
Pass-Through Rate: 6.00%(13)
Date of Pooling and Servicing Initial Certificate Principal Balance:
Agreement and Cut-off Date: $7,249,000
January 1, 2006
First Distribution Date: Servicer: Xxxxxx Loan Servicing LP
February 27, 2006
No. 1 Trustee: JPMorgan Chase Bank, N.A.
CUSIP: 69121P CW 1 Closing Date: January 30, 2006
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN
THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXXXX
XXXXX MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY OF THEIR
AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY
OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class B-5
Certificates) in that certain beneficial ownership interest evidenced by all the
Class B-5 Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Xxxxxxx
Xxxxx Mortgage Investors, Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), Credit-Based Asset Servicing
and Securitization LLC (the "Sponsor"), the Servicer and the Trustee, a summary
of certain of the pertinent provisions of which is set forth hereafter. To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
----------------------
(13) Subject to a cap as described in the Agreement
B-5-1-2
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs (the "Record
Date"), from funds in the Distribution Account in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class B-5 Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar in
writing at least five Business Days prior to the Record Date immediately prior
to such Distribution Date, or by check mailed by first class mail to the address
of the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Ownit Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class B-5 Certificates.
The Class B-5 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This Certificate is subordinated in right of payment to the Class A,
Class M, Class B-1, Class B-2, Class B-3 and Class B-4 Certificates as described
in the Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the Sponsor and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Sponsor and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.
B-5-1-3
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Trustee as provided in the Agreement, duly
endorsed by, or accompanied by an assignment in the form below or other written
instrument of transfer in form satisfactory to the Trustee and the Certificate
Registrar duly executed by, the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations specified in the Agreement. As provided in
the Agreement and subject to certain limitations therein set forth, Certificates
are exchangeable for new Certificates of the same Class in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
No transfer of this Certificate shall be made unless that transfer is
made pursuant to an effective registration statement under the 1933 Act and
effective registration or qualification under applicable state securities laws,
or is made in a transaction that does not require such registration or
qualification. In the event that a transfer is to be made without registration
or qualification (i) the Certificateholder desiring to effect the transfer and
such Certificateholder's prospective transferee shall each execute a
representation letter in the form described by the Agreement certifying to the
Certificate Registrar the facts surrounding the transfer, and (ii) unless such
transfer is made in reliance upon Rule 144A under the 1933 Act, the Depositor
and the Certificate Registrar may require an Opinion of Counsel satisfactory to
them that such transfer may be made without such registration or qualification,
which Opinion of Counsel shall not be an expense of the Depositor, the Trustee
or the Certificate Registrar, in their respective capacities as such. None of
the Depositor, the Certificate Registrar or the Trustee is obligated to register
or qualify the Class of Certificates specified on the face hereof under the 1933
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of such Certificates without
registration or qualification. Any such Certificateholder desiring to effect
such transfer shall, and does hereby agree to, indemnify the Trustee, the
Depositor, the Certificate Registrar and the Servicer against any liability that
may result if the transfer is not so exempt or is not made in accordance with
such federal and state laws. Each Person who acquires this Certificate or an
interest therein shall be deemed to have made the representations required by
the representation letter referred to in this paragraph, unless such Person
shall have provided such representation letter referred to in this paragraph to
the Certificate Registrar.
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in connection with any transfer or exchange of Certificates.
B-5-1-4
The Depositor, the Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent nor any such agent shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
B-5-1-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: January 30, 2006
JPMORGAN CHASE BANK, N.A.
as Trustee
By:
-----------------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
JPMORGAN CHASE BANK, N.A.
as Certificate Registrar
By:
-----------------------------------------
Authorized Signatory
Date of authentication: January 30, 2006
B-5-1-6
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
-------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform
Gifts to Minors Act
JT TEN - as joint tenants with right of
survivorship and not as tenants -------------------
in common (State)
Additional abbreviations may also be used though not in the above list.
B-5-1-7
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
--------------------------------------------------------------------------------
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _________________, account number ___________________, or, if
mailed by check, to ___________________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ____________________________________, as its agent.
X-0-0-0
XXXXXXX X-0-0
FORM OF CLASS B-5 CERTIFICATES (REGULATION S)
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS BENEFICIAL
OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE") AND CERTAIN OTHER
PROPERTY.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXXXX
XXXXX MORTGAGE INVESTORS, INC. ("MLMI"), THE TRUSTEE OR ANY SERVICER REFERRED TO
BELOW OR ANY OF THEIR AFFILIATES. NEITHER THIS CERTIFICATE, THE REMIC REGULAR
INTEREST REPRESENTED HEREBY NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED OR
INSURED BY MLMI, THE TRUSTEE, ANY SERVICER OR BY ANY OF THEIR AFFILIATES OR BY
ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE PRINCIPAL BALANCE OF
THIS CERTIFICATE MAY BE DIFFERENT FROM THE ORIGINAL DENOMINATION SHOWN BELOW.
ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT PRINCIPAL BALANCE BY
INQUIRY OF THE TRUSTEE.
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "1933 ACT") OR ANY STATE SECURITIES LAWS. NEITHER THIS CERTIFICATE
NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF WITHIN THE UNITED
STATES (AS DEFINED IN RULES 901 THROUGH 905 OF THE 1933 ACT ("REGULATION S")) OR
TO, OR FOR THE ACCOUNT OR BENEFIT OF, A U.S. PERSON (AS DEFINED IN REGULATION
S), IN THE ABSENCE OF SUCH REGISTRATION, UNLESS SUCH TRANSACTION IS EXEMPT FROM,
OR NOT SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS CERTIFICATE BY ITS ACCEPTANCE HEREOF AGREES (A) THAT, UNTIL
THE EXPIRATION OF THE APPLICABLE "DISTRIBUTION COMPLIANCE PERIOD" WITHIN THE
MEANING OF REGULATION S, ANY OFFER, SALE, PLEDGE OR OTHER TRANSFER OF THIS
CERTIFICATE SHALL NOT BE MADE IN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR
BENEFIT OF, ANY U.S. PERSON (EACH AS DEFINED IN REGULATION S) AND (B) TO OFFER,
SELL, PLEDGE OR OTHERWISE TRANSFER THIS CERTIFICATE WITHIN THE UNITED STATES OR
TO, OR FOR THE ACCOUNT OR BENEFIT OF, A U.S. PERSON (EACH AS DEFINED IN
REGULATION S) ONLY (1) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN
DECLARED EFFECTIVE UNDER THE 1933 ACT OR (2) TO A PERSON IT REASONABLY BELIEVES
IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE 1933 ACT
THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A, SUBJECT TO THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER,
SALE OR TRANSFER TO REQUIRE THE DELIVERY OF A CERTIFICATE OF TRANSFER IN THE
FORM APPEARING IN THE POOLING AND SERVICING AGREEMENT.
B-5-2-1
OWNIT MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2006-1, CLASS B-5
(REGULATION S)
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
XXXXXXX XXXXX MORTGAGE INVESTORS, INC.
Series 2006-1, Class B-5 Original Class Certificate Principal
Balance of the Class B-5 Certificates as
of the Closing Date: $7,249,000
Pass-Through Rate: 6.00%(14)
Date of Pooling and Servicing Initial Certificate Principal Balance:
Agreement and Cut-off Date: $0
January 1, 2006
First Distribution Date: Servicer: Xxxxxx Loan Servicing LP
February 27, 2006
No. 1 Trustee: JPMorgan Chase Bank, N.A.
CUSIP: [________] Closing Date: January 30, 2006
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN
THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXXXX
XXXXX MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY OF THEIR
AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY
OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class B-5
Certificates) in that certain beneficial ownership interest evidenced by all the
Class B-5 Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Xxxxxxx
Xxxxx Mortgage Investors, Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), Credit-Based Asset Servicing
and Securitization LLC (the "Sponsor"), the Servicer and the Trustee, a summary
of certain of the pertinent provisions of which is set forth hereafter. To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
-----------------
(14) Subject to a cap as described in the Agreement,
B-5-2-2
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs (the "Record
Date"), from funds in the Distribution Account in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class B-5 Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar in
writing at least five Business Days prior to the Record Date immediately prior
to such Distribution Date, or by check mailed by first class mail to the address
of the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Ownit Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class B-5 Certificates.
The Class B-5 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This Certificate is subordinated in right of payment to the Class A,
Class M, Class B-1, Class B-2, Class B-3 and Class B-4 Certificates as described
in the Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the Sponsor and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Sponsor and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.
B-5-2-3
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Trustee as provided in the Agreement, duly
endorsed by, or accompanied by an assignment in the form below or other written
instrument of transfer in form satisfactory to the Trustee and the Certificate
Registrar duly executed by, the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations specified in the Agreement. As provided in
the Agreement and subject to certain limitations therein set forth, Certificates
are exchangeable for new Certificates of the same Class in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
No transfer of this Certificate shall be made unless that transfer is
made pursuant to an effective registration statement under the 1933 Act and
effective registration or qualification under applicable state securities laws,
or is made in a transaction that does not require such registration or
qualification. In the event that a transfer is to be made without registration
or qualification (i) the Certificateholder desiring to effect the transfer and
such Certificateholder's prospective transferee shall each execute a
representation letter in the form described by the Agreement certifying to the
Certificate Registrar the facts surrounding the transfer, and (ii) unless such
transfer is made in reliance upon Rule 144A under the 1933 Act, the Depositor
and the Certificate Registrar may require an Opinion of Counsel satisfactory to
them that such transfer may be made without such registration or qualification,
which Opinion of Counsel shall not be an expense of the Depositor, the Trustee
or the Certificate Registrar, in their respective capacities as such. None of
the Depositor, the Certificate Registrar or the Trustee is obligated to register
or qualify the Class of Certificates specified on the face hereof under the 1933
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of such Certificates without
registration or qualification. Any such Certificateholder desiring to effect
such transfer shall, and does hereby agree to, indemnify the Trustee, the
Depositor, the Certificate Registrar and the Servicer against any liability that
may result if the transfer is not so exempt or is not made in accordance with
such federal and state laws. Each Person who acquires this Certificate or an
interest therein shall be deemed to have made the representations required by
the representation letter referred to in this paragraph, unless such Person
shall have provided such representation letter referred to in this paragraph to
the Certificate Registrar.
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in connection with any transfer or exchange of Certificates.
B-5-2-4
The Depositor, the Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent nor any such agent shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
B-5-2-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: January 30, 2006
JPMORGAN CHASE BANK, N.A.
as Trustee
By:
------------------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
JPMORGAN CHASE BANK, N.A.
as Certificate Registrar
By:
------------------------------------------
Authorized Signatory
Date of authentication: January 30, 2006
B-5-2-6
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
-------------------
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform
Gifts to Minors Act
JT TEN - as joint tenants with right of
survivorship and not as tenants -------------------
in common (State)
Additional abbreviations may also be used though not in
the above list.
B-5-2-7
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto _______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
--------------------------------------------------------------------------------
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to _________________________________________________
________________________________________________________________________________
for the account of _________________, account number ___________________, or, if
mailed by check, to ___________________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
the assignee named above, or ____________________________________, as its agent.
B-5-2-8
EXHIBIT C-1-1
FORM OF CLASS R CERTIFICATE
THIS CERTIFICATE MAY NOT BE TRANSFERRED TO A NON-UNITED STATES PERSON.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS THE
"RESIDUAL INTEREST" IN MULTIPLE "REAL ESTATE MORTGAGE INVESTMENT
CONDUITS," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G
AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE").
THIS CLASS R CERTIFICATE IS SUBORDINATE TO THE OFFERED CERTIFICATES OF
THIS SERIES TO THE EXTENT DESCRIBED HEREIN AND IN THE AGREEMENT
REFERRED TO HEREIN.
THIS CLASS R CERTIFICATE WILL NOT BE ENTITLED TO PAYMENTS UNTIL SUCH
TIME AS DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.
THIS CLASS R CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE SECURITIES
LAWS OF ANY STATE. ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS
CERTIFICATE WITHOUT SUCH REGISTRATION OR QUALIFICATION MAY BE MADE ONLY
IN A TRANSACTION THAT DOES NOT REQUIRE SUCH REGISTRATION OR
QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF
THE AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CLASS R CERTIFICATE SHALL BE REGISTERED UNLESS THE
TRUSTEE AND THE CERTIFICATE REGISTRAR SHALL HAVE RECEIVED A
REPRESENTATION FROM THE TRANSFEREE OF THIS CERTIFICATE TO THE EFFECT
THAT SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT
SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), A PLAN SUBJECT TO SECTION 4975 OF THE CODE
OR A PLAN SUBJECT TO STATE, LOCAL OR OTHER FEDERAL LAW SUBSTANTIVELY
SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE (COLLECTIVELY,
A "PLAN"), AND IS NOT DIRECTLY OR INDIRECTLY ACQUIRING THIS CERTIFICATE
FOR, ON BEHALF OF OR WITH ANY ASSETS OF ANY SUCH PLAN.
C-1-1-1
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CLASS R CERTIFICATE
MAY BE MADE ONLY IF THE PROPOSED TRANSFEREE PROVIDES (1) AN AFFIDAVIT
TO THE CERTIFICATE REGISTRAR THAT SUCH TRANSFEREE IS NOT (A) THE UNITED
STATES, ANY STATE OR POLITICAL SUBDIVISION THEREOF, ANY FOREIGN
GOVERNMENT, ANY INTERNATIONAL ORGANIZATION, OR ANY AGENCY OR
INSTRUMENTALITY OF ANY OF THE FOREGOING, (B) ANY ORGANIZATION (OTHER
THAN A COOPERATIVE DESCRIBED IN SECTION 521 OF THE CODE) WHICH IS
EXEMPT FROM THE TAX IMPOSED BY CHAPTER 1 OF THE CODE UNLESS SUCH
ORGANIZATION IS SUBJECT TO THE TAX IMPOSED BY SECTION 511 OF THE CODE,
(C) ANY ORGANIZATION DESCRIBED IN SECTION 1381(A)(2)(C) OF THE CODE
(ANY SUCH PERSON DESCRIBED IN THE FOREGOING CLAUSES (A), (B) OR (C)
BEING HEREINAFTER REFERRED TO AS A "DISQUALIFIED ORGANIZATION"), OR (D)
AN AGENT OF A DISQUALIFIED ORGANIZATION AND (2) NO PURPOSE OF SUCH
TRANSFER IS TO IMPEDE THE ASSESSMENT OR COLLECTION OF TAX, AND (3) SUCH
TRANSFEREE SATISFIES CERTAIN ADDITIONAL CONDITIONS RELATING TO THE
FINANCIAL CONDITION OF THE PROPOSED TRANSFEREE. NOTWITHSTANDING THE
REGISTRATION IN THE CERTIFICATE REGISTER OR ANY TRANSFER, SALE OR OTHER
DISPOSITION OF THIS CLASS R CERTIFICATE TO A DISQUALIFIED ORGANIZATION
OR AN AGENT OF A DISQUALIFIED ORGANIZATION, SUCH REGISTRATION SHALL BE
DEEMED TO BE OF NO LEGAL FORCE OR EFFECT WHATSOEVER AND SUCH PERSON
SHALL NOT BE DEEMED TO BE A CERTIFICATEHOLDER FOR ANY PURPOSE
HEREUNDER, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF DISTRIBUTIONS
ON THIS CERTIFICATE. EACH HOLDER OF A CLASS R CERTIFICATE BY ACCEPTANCE
OF THIS CERTIFICATE SHALL BE DEEMED TO HAVE CONSENTED TO THE PROVISIONS
OF THIS PARAGRAPH AND THE PROVISIONS OF SECTION 5.02(D) OF THE
AGREEMENT REFERRED TO HEREIN. ANY PERSON THAT IS A DISQUALIFIED
ORGANIZATION IS PROHIBITED FROM ACQUIRING BENEFICIAL OWNERSHIP OF THIS
CLASS R CERTIFICATE.
C-1-1-2
OWNIT MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2006-1, CLASS R
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
XXXXXXX XXXXX MORTGAGE INVESTORS, INC.
Series 2006-1, Class R Servicer: Xxxxxx Loan Servicing LP
Date of Pooling and Servicing Agreement and Trustee: JPMorgan Chase Bank, N.A.
Cut-off Date: January 1, 2006
First Distribution Date: February 27, 2006 Closing Date: January 30, 2006
No.1 CUSIP: 69121P CX 9
Percentage Interest: 100%
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
XXXXXXX XXXXX MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR
ANY OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY
AGENCY OR INSTRUMENTALITY OF THE UNITED STATES.
This certifies that [__________] is the registered owner of a
Percentage Interest set forth above in that certain beneficial ownership
interest evidenced by all the Class R Certificates in the Trust Fund created
pursuant to a Pooling and Servicing Agreement, dated as specified above (the
"Agreement"), among Xxxxxxx Xxxxx Mortgage Investors, Inc. (hereinafter called
the "Depositor," which term includes any successor entity under the Agreement),
Credit-Based Asset Servicing and Securitization LLC (the "Sponsor"), the
Servicer and the Trustee, a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the capitalized
terms used herein have the meanings assigned in the Agreement. This Certificate
is issued under and is subject to the terms, provisions and conditions of the
Agreement, to which Agreement the Holder of this Certificate by virtue of the
acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs (the "Record
Date"), from funds in the Distribution Account in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class R Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar in
writing at least five Business Days prior to the Record Date immediately prior
to such Distribution Date, or by check mailed by first class mail to the address
of the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
C-1-1-3
This Certificate is one of a duly authorized issue of Certificates
designated as Ownit Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
the Percentage Interest specified on the face hereof.
The Class R Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the Sponsor and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Sponsor and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Trustee as provided in the Agreement, duly
endorsed by, or accompanied by an assignment in the form below or other written
instrument of transfer in form satisfactory to the Trustee and the Certificate
Registrar duly executed by, the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
C-1-1-4
No transfer of this Certificate shall be made unless that transfer is
made pursuant to an effective registration statement under the 1933 Act and
effective registration or qualification under applicable state securities laws,
or is made in a transaction that does not require such registration or
qualification. In the event that a transfer is to be made without registration
or qualification (i) the Certificateholder desiring to effect the transfer and
such Certificateholder's prospective transferee shall each execute a
representation letter in the form described by the Agreement certifying to the
Certificate Registrar the facts surrounding the transfer, and (ii) unless such
transfer is made in reliance upon Rule 144A under the 1933 Act, the Depositor
and the Certificate Registrar may require an Opinion of Counsel satisfactory to
them that such transfer may be made without such registration or qualification,
which Opinion of Counsel shall not be an expense of the Depositor, the Trustee
or the Certificate Registrar, in their respective capacities as such. None of
the Depositor, the Certificate Registrar or the Trustee is obligated to register
or qualify the Class of Certificates specified on the face hereof under the 1933
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of such Certificates without
registration or qualification. Any such Certificateholder desiring to effect
such transfer shall, and does hereby agree to, indemnify the Trustee, the
Depositor, the Certificate Registrar and the Servicer against any liability that
may result if the transfer is not so exempt or is not made in accordance with
such federal and state laws.
No transfer of a Certificate or any interest therein may be made to
employee benefit plans and certain other retirement plans and arrangements,
including individual retirement accounts and annuities, Xxxxx plans and
collective investment funds and separate accounts in which such plans, accounts
or arrangements are invested that are subject to the fiduciary responsibility
provisions of ERISA and Section 4975 of the Code ("Plans") or any person who is
directly or indirectly purchasing the Certificate or interest therein on behalf
of, as named fiduciary of, as trustee of, or with assets of a Plan.
The Holder of this Certificate, by its acceptance hereof, shall be
deemed for all purposes to have consented to the provisions of Section 5.02 of
the Agreement and to any amendment of the Agreement deemed necessary by counsel
of the Depositor to ensure that the transfer of this Certificate to any Person
other than a Permitted Transferee or any other Person will not cause any REMIC
provided for in the Trust Agreement to cease to qualify as a REMIC or cause the
imposition of a tax upon the Trust.
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent nor any such agent shall be affected by notice to the contrary.
C-1-1-5
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
C-1-1-6
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: January 30, 2006
JPMORGAN CHASE BANK, N.A.
as Trustee
By:
-------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
JPMORGAN CHASE BANK, N.A.
as Certificate Registrar
By:
------------------------------
Authorized Signatory
Date of authentication: January 30, 2006
C-1-1-7
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
---------
(Cust) (Minor)
TEN ENT - as tenants by the under Uniform
entireties Gifts to Minors
Act
JT TEN - as joint tenants with ---------------
right of survivorship (State)
and not as tenants
in common
Additional abbreviations may also be used though not in the above list.
C-1-1-8
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto ______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
--------------------------------------------------------------------------------
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to _____________________________________________________________
for the account of ______________________________, account number _____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
______________, the assignee named above, or __________________________________
______________, as its agent.
C-1-1-9
EXHIBIT C-1-2
FORM OF CLASS R-X CERTIFICATE
THIS CERTIFICATE MAY NOT BE TRANSFERRED TO A NON-UNITED STATES PERSON.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS THE
"RESIDUAL INTEREST" IN MULTIPLE "REAL ESTATE MORTGAGE INVESTMENT
CONDUITS," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G
AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE").
THIS CLASS R-X CERTIFICATE IS SUBORDINATE TO THE OFFERED CERTIFICATES
OF THIS SERIES TO THE EXTENT DESCRIBED HEREIN AND IN THE AGREEMENT
REFERRED TO HEREIN.
THIS CLASS R-X CERTIFICATE WILL NOT BE ENTITLED TO PAYMENTS UNTIL SUCH
TIME AS DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.
THIS CLASS R-X CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE
SECURITIES LAWS OF ANY STATE. ANY RESALE, TRANSFER OR OTHER DISPOSITION
OF THIS CERTIFICATE WITHOUT SUCH REGISTRATION OR QUALIFICATION MAY BE
MADE ONLY IN A TRANSACTION THAT DOES NOT REQUIRE SUCH REGISTRATION OR
QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF
THE AGREEMENT REFERRED TO HEREIN.
NO TRANSFER OF THIS CLASS R-X CERTIFICATE SHALL BE REGISTERED UNLESS
THE TRUSTEE AND THE CERTIFICATE REGISTRAR SHALL HAVE RECEIVED A
REPRESENTATION FROM THE TRANSFEREE OF THIS CERTIFICATE TO THE EFFECT
THAT SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT
SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), A PLAN SUBJECT TO SECTION 4975 OF THE CODE
OR A PLAN SUBJECT TO STATE, LOCAL OR OTHER FEDERAL LAW SUBSTANTIVELY
SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE CODE (COLLECTIVELY,
A "PLAN"), AND IS NOT DIRECTLY OR INDIRECTLY ACQUIRING THIS CERTIFICATE
FOR, ON BEHALF OF OR WITH ANY ASSETS OF ANY SUCH PLAN.
C-1-2-1
ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS CLASS R-X CERTIFICATE
MAY BE MADE ONLY IF THE PROPOSED TRANSFEREE PROVIDES (1) AN AFFIDAVIT
TO THE CERTIFICATE REGISTRAR THAT SUCH TRANSFEREE IS NOT (A) THE UNITED
STATES, ANY STATE OR POLITICAL SUBDIVISION THEREOF, ANY FOREIGN
GOVERNMENT, ANY INTERNATIONAL ORGANIZATION, OR ANY AGENCY OR
INSTRUMENTALITY OF ANY OF THE FOREGOING, (B) ANY ORGANIZATION (OTHER
THAN A COOPERATIVE DESCRIBED IN SECTION 521 OF THE CODE) WHICH IS
EXEMPT FROM THE TAX IMPOSED BY CHAPTER 1 OF THE CODE UNLESS SUCH
ORGANIZATION IS SUBJECT TO THE TAX IMPOSED BY SECTION 511 OF THE CODE,
(C) ANY ORGANIZATION DESCRIBED IN SECTION 1381(A)(2)(C) OF THE CODE
(ANY SUCH PERSON DESCRIBED IN THE FOREGOING CLAUSES (A), (B) OR (C)
BEING HEREINAFTER REFERRED TO AS A "DISQUALIFIED ORGANIZATION"), OR (D)
AN AGENT OF A DISQUALIFIED ORGANIZATION AND (2) NO PURPOSE OF SUCH
TRANSFER IS TO IMPEDE THE ASSESSMENT OR COLLECTION OF TAX, AND (3) SUCH
TRANSFEREE SATISFIES CERTAIN ADDITIONAL CONDITIONS RELATING TO THE
FINANCIAL CONDITION OF THE PROPOSED TRANSFEREE. NOTWITHSTANDING THE
REGISTRATION IN THE CERTIFICATE REGISTER OR ANY TRANSFER, SALE OR OTHER
DISPOSITION OF THIS CLASS R-X CERTIFICATE TO A DISQUALIFIED
ORGANIZATION OR AN AGENT OF A DISQUALIFIED ORGANIZATION, SUCH
REGISTRATION SHALL BE DEEMED TO BE OF NO LEGAL FORCE OR EFFECT
WHATSOEVER AND SUCH PERSON SHALL NOT BE DEEMED TO BE A
CERTIFICATEHOLDER FOR ANY PURPOSE HEREUNDER, INCLUDING, BUT NOT LIMITED
TO, THE RECEIPT OF DISTRIBUTIONS ON THIS CERTIFICATE. EACH HOLDER OF A
CLASS R-X CERTIFICATE BY ACCEPTANCE OF THIS CERTIFICATE SHALL BE DEEMED
TO HAVE CONSENTED TO THE PROVISIONS OF THIS PARAGRAPH AND THE
PROVISIONS OF SECTION 5.02(D) OF THE AGREEMENT REFERRED TO HEREIN. ANY
PERSON THAT IS A DISQUALIFIED ORGANIZATION IS PROHIBITED FROM ACQUIRING
BENEFICIAL OWNERSHIP OF THIS CLASS R-X CERTIFICATE.
C-1-2-2
OWNIT MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2006-1, CLASS R-X
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
XXXXXXX XXXXX MORTGAGE INVESTORS, INC.
Series 2006-1, Class R-X Servicer: Xxxxxx Loan Servicing LP
Date of Pooling and Servicing Agreement Trustee: JPMorgan Chase Bank, N.A.
and Cut-off Date: January 1, 2006
First Distribution Date: February 27, 2006 Closing Date: January 30, 2006
No. 1 CUSIP: 69121P CY 7
Percentage Interest: 100%
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN
XXXXXXX XXXXX MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR
ANY OF THEIR AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY
AGENCY OR INSTRUMENTALITY OF THE UNITED STATES.
This certifies that [__________] is the registered owner of a
Percentage Interest set forth above in that certain beneficial ownership
interest evidenced by all the Class R-X Certificates in the Trust Fund created
pursuant to a Pooling and Servicing Agreement, dated as specified above (the
"Agreement"), among Xxxxxxx Xxxxx Mortgage Investors, Inc. (hereinafter called
the "Depositor," which term includes any successor entity under the Agreement),
Credit-Based Asset Servicing and Securitization LLC (the "Sponsor"), the
Servicer and the Trustee, a summary of certain of the pertinent provisions of
which is set forth hereafter. To the extent not defined herein, the capitalized
terms used herein have the meanings assigned in the Agreement. This Certificate
is issued under and is subject to the terms, provisions and conditions of the
Agreement, to which Agreement the Holder of this Certificate by virtue of the
acceptance hereof assents and by which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs (the "Record
Date"), from funds in the Distribution Account in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class R-X Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar in
writing at least five Business Days prior to the Record Date immediately prior
to such Distribution Date, or by check mailed by first class mail to the address
of the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
C-1-2-3
This Certificate is one of a duly authorized issue of Certificates
designated as Ownit Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
the Percentage Interest specified on the face hereof.
The Class R-X Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the Sponsor and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Sponsor and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Trustee as provided in the Agreement, duly
endorsed by, or accompanied by an assignment in the form below or other written
instrument of transfer in form satisfactory to the Trustee and the Certificate
Registrar duly executed by, the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
C-1-2-4
No transfer of this Certificate shall be made unless that transfer is
made pursuant to an effective registration statement under the 1933 Act and
effective registration or qualification under applicable state securities laws,
or is made in a transaction that does not require such registration or
qualification. In the event that a transfer is to be made without registration
or qualification (i) the Certificateholder desiring to effect the transfer and
such Certificateholder's prospective transferee shall each execute a
representation letter in the form described by the Agreement certifying to the
Certificate Registrar the facts surrounding the transfer, and (ii) unless such
transfer is made in reliance upon Rule 144A under the 1933 Act, the Depositor
and the Certificate Registrar may require an Opinion of Counsel satisfactory to
them that such transfer may be made without such registration or qualification,
which Opinion of Counsel shall not be an expense of the Depositor, the Trustee
or the Certificate Registrar, in their respective capacities as such. None of
the Depositor, the Certificate Registrar or the Trustee is obligated to register
or qualify the Class of Certificates specified on the face hereof under the 1933
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of such Certificates without
registration or qualification. Any such Certificateholder desiring to effect
such transfer shall, and does hereby agree to, indemnify the Trustee, the
Depositor, the Certificate Registrar and the Servicer against any liability that
may result if the transfer is not so exempt or is not made in accordance with
such federal and state laws.
No transfer of a Certificate or any interest therein may be made to
employee benefit plans and certain other retirement plans and arrangements,
including individual retirement accounts and annuities, Xxxxx plans and
collective investment funds and separate accounts in which such plans, accounts
or arrangements are invested that are subject to the fiduciary responsibility
provisions of ERISA and Section 4975 of the Code ("Plans") or any person who is
directly or indirectly purchasing the Certificate or interest therein on behalf
of, as named fiduciary of, as trustee of, or with assets of a Plan.
The Holder of this Certificate, by its acceptance hereof, shall be
deemed for all purposes to have consented to the provisions of Section 5.02 of
the Agreement and to any amendment of the Agreement deemed necessary by counsel
of the Depositor to ensure that the transfer of this Certificate to any Person
other than a Permitted Transferee or any other Person will not cause any REMIC
provided for in the Trust Agreement to cease to qualify as a REMIC or cause the
imposition of a tax upon the Trust.
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent nor any such agent shall be affected by notice to the contrary.
C-1-2-5
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
C-1-2-6
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: January 30, 2006
JPMORGAN CHASE BANK, N.A.
as Trustee
By:
--------------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
JPMORGAN CHASE BANK, N.A.
as Certificate Registrar
By:
--------------------------------------
Authorized Signatory
Date of authentication: January 30, 2006
C-1-2-7
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
---------
(Cust) (Minor)
TEN ENT - as tenants by the under Uniform
entireties Gifts to Minors
Act
JT TEN - as joint tenants with ---------------
right of survivorship (State)
and not as tenants
in common
Additional abbreviations may also be used though not in the above list.
C-1-2-8
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto ______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
--------------------------------------------------------------------------------
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to _____________________________________________________________
for the account of ______________________________, account number _____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
______________, the assignee named above, or __________________________________
______________, as its agent.
C-1-2-9
EXHIBIT C-2
FORM OF CLASS M-1 CERTIFICATES
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A CERTIFICATES
AS DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS BENEFICIAL
OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF
THE CODE AND CERTAIN OTHER PROPERTY.
OWNIT MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2006-1, CLASS M-1
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
XXXXXXX XXXXX MORTGAGE INVESTORS, INC.
Series 2006-1, Class M-1 Original Class Certificate
Principal Balance of the
Class M-1 Certificates as of
the Closing Date: $23,924,000
Pass-Through Rate: Variable(15)
Date of Pooling and Servicing Initial Certificate Principal
Agreement and Cut-off Balance: $23,924,000
Date: January 1, 2006
First Distribution Date: February 27, 2006 Servicer: Xxxxxx Loan Servicing
LP
No. 1 Trustee: JPMorgan Chase Bank,
N.A.
CUSIP: 69121P CL 5 Closing Date: January 30, 2006
-------------
(15) Subject to a cap as described in the Agreement
C-2-1
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN
THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXXXX
XXXXX MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY OF THEIR
AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY
OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class M-1
Certificates) in that certain beneficial ownership interest evidenced by all the
Class M-1 Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Xxxxxxx
Xxxxx Mortgage Investors, Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), Credit-Based Asset Servicing
and Securitization LLC (the "Sponsor"), the Servicer and the Trustee, a summary
of certain of the pertinent provisions of which is set forth hereafter. To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
M-1 Certificates on such Distribution Date pursuant to the Agreement; provided,
however, that if any Class M-1 Certificate becomes a Definitive Certificate, the
Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar in
writing at least five Business Days prior to the Record Date immediately prior
to such Distribution Date, or by check mailed by first class mail to the address
of the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
C-2-2
The Class M-1 Pass-Through Rate on each Distribution Date will be a
rate per annum equal to the least of (i) LIBOR as of the related LIBOR
Determination Date, plus the Class M-1 Certificate Margin, (ii) the Subordinate
Net WAC Cap and (iii) the Subordinate Maximum Rate Cap.
This Certificate is one of a duly authorized issue of Certificates
designated as Ownit Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class M-1 Certificates.
The Class M-1 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This Certificate is subordinated in right of payment to the Class A
Certificates as described in the Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the Sponsor and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Sponsor and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Trustee as provided in the Agreement, duly
endorsed by, or accompanied by an assignment in the form below or other written
instrument of transfer in form satisfactory to the Trustee and the Certificate
Registrar duly executed by, the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or transferees.
C-2-3
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations specified in the Agreement. As provided in
the Agreement and subject to certain limitations therein set forth, Certificates
are exchangeable for new Certificates of the same Class in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent nor any such agent shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
C-2-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: January 30, 2006
JPMORGAN CHASE BANK, N.A.
as Trustee
By:
---------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
JPMORGAN CHASE BANK, N.A.
as Certificate Registrar
By:
---------------------------------
Authorized Signatory
Date of authentication: January 30, 2006
C-2-5
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
---------
(Cust) (Minor)
TEN ENT - as tenants by the under Uniform
entireties Gifts to Minors
Act
JT TEN - as joint tenants with ---------------
right of survivorship (State)
and not as tenants
in common
Additional abbreviations may also be used though not in the above list.
C-2-6
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto ______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
--------------------------------------------------------------------------------
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to _____________________________________________________________
for the account of ______________________________, account number _____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
______________, the assignee named above, or __________________________________
______________, as its agent.
C-2-7
EXHIBIT C-3
FORM OF CLASS M-2 CERTIFICATES
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A AND CLASS
M-1 CERTIFICATES AS DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS BENEFICIAL
OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF
THE CODE AND CERTAIN OTHER PROPERTY.
OWNIT MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2006-1, CLASS M-2
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
XXXXXXX XXXXX MORTGAGE INVESTORS, INC.
Series 2006-1, Class M-2 Original Class Certificate
Principal Balance of the
Class M-2 Certificates as of
the Closing Date: $23,199,000
Pass-Through Rate: Variable(16)
Date of Pooling and Servicing Initial Certificate Principal
Agreement and Cut-off Balance: $23,199,000
Date: January 1, 2006
First Distribution Date: February 27, 2006 Servicer: Xxxxxx Loan Servicing
LP
No. 1 Trustee: JPMorgan Chase Bank,
N.A.
CUSIP: 69121P CM 3 Closing Date: January 30, 2006
-------------
(16) Subject to a cap as described in the Agreement
C-3-1
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN
THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXXXX
XXXXX MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY OF THEIR
AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY
OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class M-2
Certificates) in that certain beneficial ownership interest evidenced by all the
Class M-2 Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Xxxxxxx
Xxxxx Mortgage Investors, Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), Credit-Based Asset Servicing
and Securitization LLC (the "Sponsor"), the Servicer and the Trustee, a summary
of certain of the pertinent provisions of which is set forth hereafter. To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
M-2 Certificates on such Distribution Date pursuant to the Agreement; provided,
however, that if any Class M-2 Certificate becomes a Definitive Certificate, the
Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar in
writing at least five Business Days prior to the Record Date immediately prior
to such Distribution Date, or by check mailed by first class mail to the address
of the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
C-3-2
The Class M-2 Pass-Through Rate on each Distribution Date will be a
rate per annum equal to the least of (i) LIBOR as of the related LIBOR
Determination Date, plus the Class M-2 Certificate Margin, (ii) the Subordinate
Net WAC Cap and (iii) the Subordinate Maximum Rate Cap.
This Certificate is one of a duly authorized issue of Certificates
designated as Ownit Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class M-2 Certificates.
The Class M-2 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This Certificate is subordinated in right of payment to the Class A and
Class M-1 Certificates as described in the Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the Sponsor and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Sponsor and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Trustee as provided in the Agreement, duly
endorsed by, or accompanied by an assignment in the form below or other written
instrument of transfer in form satisfactory to the Trustee and the Certificate
Registrar duly executed by, the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or transferees.
C-3-3
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations specified in the Agreement. As provided in
the Agreement and subject to certain limitations therein set forth, Certificates
are exchangeable for new Certificates of the same Class in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent nor any such agent shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
C-3-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: January 30, 2006
JPMORGAN CHASE BANK, N.A.
as Trustee
By:
-------------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
JPMORGAN CHASE BANK, N.A.
as Certificate Registrar
By:
-------------------------------------
Authorized Signatory
Date of authentication: January 30, 2006
C-3-5
EXHIBIT C-4
FORM OF CLASS M-3 CERTIFICATES
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A, CLASS M-1
AND CLASS M-2 CERTIFICATES AS DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS BENEFICIAL
OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF
THE CODE AND CERTAIN OTHER PROPERTY.
OWNIT MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2006-1, CLASS M-3
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
XXXXXXX XXXXX MORTGAGE INVESTORS, INC.
Series 2006-1, Class M-3 Original Class Certificate
Principal Balance of the
Class M-3 Certificates as of
the Closing Date: $14,137,000
Pass-Through Rate: Variable(17)
Date of Pooling and Servicing Initial Certificate Principal
Agreement and Cut-off Balance: $14,137,000
Date: January 1, 2006
First Distribution Date: February 27, 2006 Servicer: Xxxxxx Loan Servicing
LP
No. 1 Trustee: JPMorgan Chase Bank,
N.A.
CUSIP: 69121P CN 1 Closing Date: January 30, 2006
-------------
(17) Subject to a cap as described in the Agreement
C-4-1
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN
THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXXXX
XXXXX MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY OF THEIR
AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY
OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class M-3
Certificates) in that certain beneficial ownership interest evidenced by all the
Class M-3 Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Xxxxxxx
Xxxxx Mortgage Investors, Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), Credit-Based Asset Servicing
and Securitization LLC (the "Sponsor"), the Servicer and the Trustee, a summary
of certain of the pertinent provisions of which is set forth hereafter. To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
M-3 Certificates on such Distribution Date pursuant to the Agreement; provided,
however, that if any Class M-3 Certificate becomes a Definitive Certificate, the
Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar in
writing at least five Business Days prior to the Record Date immediately prior
to such Distribution Date, or by check mailed by first class mail to the address
of the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
C-4-2
The Class M-3 Pass-Through Rate on each Distribution Date will be a
rate per annum equal to the least of (i) LIBOR as of the related LIBOR
Determination Date, plus the Class M-3 Certificate Margin, (ii) the Subordinate
Net WAC Cap and (iii) the Subordinate Maximum Rate Cap.
This Certificate is one of a duly authorized issue of Certificates
designated as Ownit Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class M-3 Certificates.
The Class M-3 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This Certificate is subordinated in right of payment to the Class A,
Class M-1 and Class M-2 Certificates as described in the Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the Sponsor and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Sponsor and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Trustee as provided in the Agreement, duly
endorsed by, or accompanied by an assignment in the form below or other written
instrument of transfer in form satisfactory to the Trustee and the Certificate
Registrar duly executed by, the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or transferees.
C-4-3
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations specified in the Agreement. As provided in
the Agreement and subject to certain limitations therein set forth, Certificates
are exchangeable for new Certificates of the same Class in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent nor any such agent shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
C-4-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: January 30, 2006
JPMORGAN CHASE BANK, N.A.
as Trustee
By:
-------------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
JPMORGAN CHASE BANK, N.A.
as Certificate Registrar
By:
-------------------------------------
Authorized Signatory
Date of authentication: January 30, 2006
C-4-5
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
---------
(Cust) (Minor)
TEN ENT - as tenants by the under Uniform
entireties Gifts to Minors
Act
JT TEN - as joint tenants with ---------------
right of survivorship (State)
and not as tenants
in common
Additional abbreviations may also be used though not in the above list.
C-4-6
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto ______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
--------------------------------------------------------------------------------
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to _____________________________________________________________
for the account of ______________________________, account number _____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
______________, the assignee named above, or __________________________________
______________, as its agent.
C-4-7
EXHIBIT C-5
FORM OF CLASS M-4 CERTIFICATES
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A, CLASS M-1,
CLASS M-2 AND CLASS M-3 CERTIFICATES AS DESCRIBED IN THE AGREEMENT REFERRED TO
HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS BENEFICIAL
OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF
THE CODE AND CERTAIN OTHER PROPERTY.
OWNIT MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2006-1, CLASS M-4
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
XXXXXXX XXXXX MORTGAGE INVESTORS, INC.
Series 2006-1, Class M-4 Original Class Certificate
Principal Balance of the
Class M-4 Certificates as of
the Closing Date: $12,687,000
Pass-Through Rate: Variable(18)
Date of Pooling and Servicing Initial Certificate Principal
Agreement and Cut-off Balance: $12,687,000
Date: January 1, 2006
First Distribution Date: February 27, 2006 Servicer: Xxxxxx Loan Servicing
LP
No. 1 Trustee: JPMorgan Chase Bank,
N.A.
CUSIP: 69121P CP 6 Closing Date: January 30, 2006
-------------
(18) Subject to a cap as described in the Agreement
C-5-1
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN
THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXXXX
XXXXX MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY OF THEIR
AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY
OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class M-4
Certificates) in that certain beneficial ownership interest evidenced by all the
Class M-4 Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Xxxxxxx
Xxxxx Mortgage Investors, Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), Credit-Based Asset Servicing
and Securitization LLC (the "Sponsor"), the Servicer and the Trustee, a summary
of certain of the pertinent provisions of which is set forth hereafter. To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
M-4 Certificates on such Distribution Date pursuant to the Agreement; provided,
however, that if any Class M-4 Certificate becomes a Definitive Certificate, the
Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar in
writing at least five Business Days prior to the Record Date immediately prior
to such Distribution Date, or by check mailed by first class mail to the address
of the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
C-5-2
The Class M-4 Pass-Through Rate on each Distribution Date will be a
rate per annum equal to the least of (i) LIBOR as of the related LIBOR
Determination Date, plus the Class M-4 Certificate Margin, (ii) the Subordinate
Net WAC Cap and (iii) the Subordinate Maximum Rate Cap.
This Certificate is one of a duly authorized issue of Certificates
designated as Ownit Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class M-4 Certificates.
The Class M-4 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This Certificate is subordinated in right of payment to the Class A,
Class M-1, Class M-2 and Class M-3 Certificates as described in the Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the Sponsor and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Sponsor and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Trustee as provided in the Agreement, duly
endorsed by, or accompanied by an assignment in the form below or other written
instrument of transfer in form satisfactory to the Trustee and the Certificate
Registrar duly executed by, the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or transferees.
C-5-3
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations specified in the Agreement. As provided in
the Agreement and subject to certain limitations therein set forth, Certificates
are exchangeable for new Certificates of the same Class in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent nor any such agent shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
C-5-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: January 30, 2006
JPMORGAN CHASE BANK, N.A.
as Trustee
By:
-------------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
JPMORGAN CHASE BANK, N.A.
as Certificate Registrar
By:
-------------------------------------
Authorized Signatory
Date of authentication: January 30, 2006
C-5-5
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
---------
(Cust) (Minor)
TEN ENT - as tenants by the under Uniform
entireties Gifts to Minors
Act
JT TEN - as joint tenants with ---------------
right of survivorship (State)
and not as tenants
in common
Additional abbreviations may also be used though not in the above list.
C-5-6
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto ______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
--------------------------------------------------------------------------------
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to _____________________________________________________________
for the account of ______________________________, account number _____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
______________, the assignee named above, or __________________________________
______________, as its agent.
C-5-7
EXHIBIT C-6
FORM OF CLASS M-5 CERTIFICATES
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A, CLASS M-1,
CLASS M-2, CLASS M-3 AND CLASS M-4 CERTIFICATES AS DESCRIBED IN THE AGREEMENT
REFERRED TO HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS BENEFICIAL
OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF
THE CODE AND CERTAIN OTHER PROPERTY.
OWNIT MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2006-1, CLASS M-5
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
XXXXXXX XXXXX MORTGAGE INVESTORS, INC.
Series 2006-1, Class M-5 Original Class Certificate
Principal Balance of the
Class M-5 Certificates as of
the Closing Date: $12,687,000
Pass-Through Rate: Variable(19)
Date of Pooling and Servicing Initial Certificate Principal
Agreement and Cut-off Balance: $12,687,000
Date: January 1, 2006
First Distribution Date: February 27, 2006 Servicer: Xxxxxx Loan Servicing
LP
No. 1 Trustee: JPMorgan Chase Bank,
N.A.
CUSIP: 69121P CQ 4 Closing Date: January 30, 2006
-------------
(19) Subject to a cap as described in the Agreement
C-6-1
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN
THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXXXX
XXXXX MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY OF THEIR
AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY
OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class M-5
Certificates) in that certain beneficial ownership interest evidenced by all the
Class M-5 Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Xxxxxxx
Xxxxx Mortgage Investors, Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), Credit-Based Asset Servicing
and Securitization LLC (the "Sponsor"), the Servicer and the Trustee, a summary
of certain of the pertinent provisions of which is set forth hereafter. To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
M-5 Certificates on such Distribution Date pursuant to the Agreement; provided,
however, that if any Class M-5 Certificate becomes a Definitive Certificate, the
Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar in
writing at least five Business Days prior to the Record Date immediately prior
to such Distribution Date, or by check mailed by first class mail to the address
of the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
C-6-2
The Class M-5 Pass-Through Rate on each Distribution Date will be a
rate per annum equal to the least of (i) LIBOR as of the related LIBOR
Determination Date, plus the Class M-5 Certificate Margin, (ii) the Subordinate
Net WAC Cap and (iii) the Subordinate Maximum Rate Cap.
This Certificate is one of a duly authorized issue of Certificates
designated as Ownit Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class M-5 Certificates.
The Class M-5 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This Certificate is subordinated in right of payment to the Class A,
Class M-1, Class M-2, Class M-3 and Class M-4 Certificates as described in the
Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the Sponsor and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Sponsor and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Trustee as provided in the Agreement, duly
endorsed by, or accompanied by an assignment in the form below or other written
instrument of transfer in form satisfactory to the Trustee and the Certificate
Registrar duly executed by, the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or transferees.
C-6-3
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations specified in the Agreement. As provided in
the Agreement and subject to certain limitations therein set forth, Certificates
are exchangeable for new Certificates of the same Class in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent nor any such agent shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
C-6-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: January 30, 2006
JPMORGAN CHASE BANK, N.A.
as Trustee
By:
-------------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
JPMORGAN CHASE BANK, N.A.
as Certificate Registrar
By:
-------------------------------------
Authorized Signatory
Date of authentication: January 30, 2006
C-6-5
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
---------
(Cust) (Minor)
TEN ENT - as tenants by the under Uniform
entireties Gifts to Minors
Act
JT TEN - as joint tenants with ---------------
right of survivorship (State)
and not as tenants
in common
Additional abbreviations may also be used though not in the above list.
C-6-6
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto ______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
--------------------------------------------------------------------------------
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to _____________________________________________________________
for the account of ______________________________, account number _____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
______________, the assignee named above, or __________________________________
______________, as its agent.
C-6-7
EXHIBIT C-7
FORM OF CLASS M-6 CERTIFICATES
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A, CLASS M-1,
CLASS M-2, CLASS M-3, CLASS M-4 AND CLASS M-5 CERTIFICATES AS DESCRIBED IN THE
AGREEMENT REFERRED TO HEREIN.
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS BENEFICIAL
OWNERSHIP OF A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT
CONDUIT," AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF
THE CODE AND CERTAIN OTHER PROPERTY.
OWNIT MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2006-1, CLASS M-6
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
XXXXXXX XXXXX MORTGAGE INVESTORS, INC.
Series 2006-1, Class M-6 Original Class Certificate
Principal Balance of the
Class M-6 Certificates as of
the Closing Date: $12,324,000
Pass-Through Rate: Variable(20)
Date of Pooling and Servicing Initial Certificate Principal
Agreement and Cut-off Balance: $12,324,000
Date: January 1, 2006
First Distribution Date: February 27, 2006 Servicer: Xxxxxx Loan Servicing
LP
No. 1 Trustee: JPMorgan Chase Bank,
N.A.
CUSIP: 69121P CR 2 Closing Date: January 30, 2006
-------------
(20) Subject to a cap as described in the Agreement
C-7-1
DISTRIBUTIONS IN REDUCTION OF THE CERTIFICATE PRINCIPAL BALANCE OF THIS
CERTIFICATE MAY BE MADE MONTHLY AS SET FORTH HEREIN. ACCORDINGLY, THE
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE HEREOF AT ANY TIME MAY BE LESS THAN
THE AMOUNT SHOWN ABOVE.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXXXX
XXXXX MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY OF THEIR
AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY
OF THE UNITED STATES.
This certifies that CEDE & CO. is the registered owner of a Percentage
Interest (obtained by dividing the Initial Certificate Principal Balance of this
Certificate by the Original Class Certificate Principal Balance of the Class M-6
Certificates) in that certain beneficial ownership interest evidenced by all the
Class M-6 Certificates in the Trust Fund created pursuant to a Pooling and
Servicing Agreement, dated as specified above (the "Agreement"), among Xxxxxxx
Xxxxx Mortgage Investors, Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), Credit-Based Asset Servicing
and Securitization LLC (the "Sponsor"), the Servicer and the Trustee, a summary
of certain of the pertinent provisions of which is set forth hereafter. To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the Business Day immediately preceding such
Distribution Date (the "Record Date"), from funds in the Distribution Account in
an amount equal to the product of the Percentage Interest evidenced by this
Certificate and the amount required to be distributed to the Holders of Class
M-6 Certificates on such Distribution Date pursuant to the Agreement; provided,
however, that if any Class M-6 Certificate becomes a Definitive Certificate, the
Record Date for such Certificate will be the last Business Day of the month
immediately preceding the month in which the related Distribution Date occurs.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar in
writing at least five Business Days prior to the Record Date immediately prior
to such Distribution Date, or by check mailed by first class mail to the address
of the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
C-7-2
The Class M-6 Pass-Through Rate on each Distribution Date will be a
rate per annum equal to the least of (i) LIBOR as of the related LIBOR
Determination Date, plus the Class M-6 Certificate Margin, (ii) the Subordinate
Net WAC Cap and (iii) the Subordinate Maximum Rate Cap.
This Certificate is one of a duly authorized issue of Certificates
designated as Ownit Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
a Percentage Interest in the Class M-6 Certificates.
The Class M-6 Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
This Certificate is subordinated in right of payment to the Class A,
Class M-1, Class M-2, Class M-3, Class M-4 and Class M-5 Certificates as
described in the Agreement.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the Sponsor and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Sponsor and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Trustee as provided in the Agreement, duly
endorsed by, or accompanied by an assignment in the form below or other written
instrument of transfer in form satisfactory to the Trustee and the Certificate
Registrar duly executed by, the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations specified in the Agreement. As provided in
the Agreement and subject to certain limitations therein set forth, Certificates
are exchangeable for new Certificates of the same Class in authorized
denominations evidencing the same aggregate Percentage Interest, as requested by
the Holder surrendering the same.
C-7-3
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent nor any such agent shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
C-7-4
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: January 30, 2006
JPMORGAN CHASE BANK, N.A.
as Trustee
By:
-------------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
JPMORGAN CHASE BANK, N.A.
as Certificate Registrar
By:
-------------------------------------
Authorized Signatory
Date of authentication: January 30, 2006
C-7-5
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
---------
(Cust) (Minor)
TEN ENT - as tenants by the under Uniform
entireties Gifts to Minors
Act
JT TEN - as joint tenants with ---------------
right of survivorship (State)
and not as tenants
in common
Additional abbreviations may also be used though not in the above list.
C-7-6
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto ______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
--------------------------------------------------------------------------------
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to _____________________________________________________________
for the account of ______________________________, account number _____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
______________, the assignee named above, or __________________________________
______________, as its agent.
C-7-7
EXHIBIT C-8
FORM OF CLASS N CERTIFICATES
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A
DIRECT OR INDIRECT BENEFICIAL INTEREST IN A "REGULAR INTEREST" IN A
"REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE "CODE") AND THE OBLIGATION TO MAKE CERTAIN
PAYMENTS.
THIS CLASS N CERTIFICATE IS SUBORDINATE TO THE OFFERED CERTIFICATES OF
THIS SERIES TO THE EXTENT DESCRIBED HEREIN AND IN THE AGREEMENT
REFERRED TO HEREIN.
THIS CLASS N CERTIFICATE WILL NOT BE ENTITLED TO PAYMENTS UNTIL SUCH
TIME AS DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.
THIS CLASS N CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE SECURITIES
LAWS OF ANY STATE. ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS
CERTIFICATE WITHOUT SUCH REGISTRATION OR QUALIFICATION MAY BE MADE ONLY
IN A TRANSACTION THAT DOES NOT REQUIRE SUCH REGISTRATION OR
QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF
THE AGREEMENT REFERRED TO HEREIN.
EXCEPT AS PROVIDED IN SECTION 5.02(D) OF THE AGREEMENT REFERRED TO
HEREIN, NO TRANSFER OF THIS CERTIFICATE SHALL BE REGISTERED UNLESS THE
TRUSTEE AND THE CERTIFICATE REGISTRAR SHALL HAVE RECEIVED (A) A
REPRESENTATION FROM THE TRANSFEREE OF THIS CERTIFICATE TO THE EFFECT
THAT SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT
SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), A PLAN SUBJECT TO SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE") OR A PLAN
SUBJECT TO STATE, LOCAL OR OTHER FEDERAL LAW SUBSTANTIVELY SIMILAR TO
THE FOREGOING PROVISIONS OF ERISA OR THE CODE ("SIMILAR LAW")
(COLLECTIVELY, A "PLAN"), AND IS NOT DIRECTLY OR INDIRECTLY ACQUIRING
THIS CERTIFICATE FOR, ON BEHALF OF OR WITH ANY ASSETS OF ANY SUCH PLAN,
(B) A REPRESENTATION THAT THE TRANSFEREE IS AN INSURANCE COMPANY THAT
IS ACQUIRING THE CERTIFICATE WITH ASSETS OF AN "INSURANCE COMPANY
GENERAL ACCOUNT" AS DEFINED IN SECTION V(E) OF PROHIBITED TRANSACTION
CLASS EXEMPTION ("PTCE") 95-60, AND THE ACQUISITION AND HOLDING OF THE
CERTIFICATE ARE COVERED AND EXEMPT UNDER SECTIONS I AND III OF PTCE
95-60, OR (C) SOLELY IN THE CASE OF A DEFINITIVE CERTIFICATE, AN
OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE AND THE CERTIFICATE
REGISTRAR, AND UPON WHICH THE TRUSTEE AND THE CERTIFICATE REGISTRAR
SHALL BE ENTITLED TO RELY, TO THE EFFECT THAT THE ACQUISITION AND
HOLDING OF THIS CERTIFICATE BY THE TRANSFEREE WILL NOT RESULT IN A
NONEXEMPT PROHIBITED TRANSACTION UNDER TITLE I OF ERISA OR SECTION 4975
OF THE CODE, OR A VIOLATION OF SIMILAR LAW, AND WILL NOT SUBJECT THE
CERTIFICATE REGISTRAR, THE DEPOSITOR, THE SERVICER OR THE TRUSTEE TO
ANY OBLIGATION IN ADDITION TO THOSE UNDERTAKEN BY SUCH ENTITIES IN THE
AGREEMENT REFERRED TO HEREIN, WHICH OPINION OF COUNSEL SHALL NOT BE AN
EXPENSE OF THE CERTIFICATE REGISTRAR, THE DEPOSITOR, THE SERVICER OR
THE TRUSTEE.
C-8-1
OWNIT MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2006-1, CLASS N
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
XXXXXXX XXXXX MORTGAGE INVESTORS, INC.
Series 2006-1, Class N Original Class Certificate
Notional Balance of the
Class N Certificates as of
the Closing Date: $[__________]
Pass-Through Rate: [___] Initial Notional Amount:
Balance: $[_______]
Date of Pooling and Servicing Servicer: Xxxxxx Loan Servicing
Agreement and Cut-off LP
Date: January 1, 2006
First Distribution Date: February 27, 2006 Trustee: JPMorgan Chase Bank,
N.A.
CUSIP: 69121P CZ 4 Closing Date: January 30, 2006
No. 1
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXXXX
XXXXX MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY OF THEIR
AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY
OF THE UNITED STATES.
C-8-2
This certifies that XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX INCORPORATED
is the registered owner of a Percentage Interest (obtained by dividing the
Initial Notional Amount of this Certificate by the Original Class N Notional
Amount) in that certain beneficial ownership interest evidenced by all the Class
N Certificates in the Trust Fund created pursuant to a Pooling and Servicing
Agreement, dated as specified above (the "Agreement"), among Xxxxxxx Xxxxx
Mortgage Investors, Inc. (hereinafter called the "Depositor," which term
includes any successor entity under the Agreement), Credit-Based Asset Servicing
and Securitization LLC (the "Sponsor"), the Servicer and the Trustee, a summary
of certain of the pertinent provisions of which is set forth hereafter. To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder of this Certificate by virtue of the acceptance hereof assents and by
which such Holder is bound.
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs or the Closing
Date in the case of the first Distribution Date (the "Record Date"), from funds
in the Distribution Account in an amount equal to the product of the Percentage
Interest evidenced by this Certificate and the amount required to be distributed
to the Holders of Class N Certificates on such Distribution Date pursuant to the
Agreement.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar in
writing at least five Business Days prior to the Record Date immediately prior
to such Distribution Date, or by check mailed by first class mail to the address
of the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
The Pass-Through Rate for this Class N Certificates on each
Distribution Date will be the per annum rate specified above.
This Certificate is one of a duly authorized issue of Certificates
designated as Ownit Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
the Percentage Interest specified on the face hereof.
The Class N Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
C-8-3
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the Sponsor and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Sponsor and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Trustee as provided in the Agreement, duly
endorsed by, or accompanied by an assignment in the form below or other written
instrument of transfer in form satisfactory to the Trustee and the Certificate
Registrar duly executed by, the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No transfer of this Certificate shall be made unless that transfer is
made pursuant to an effective registration statement under the 1933 Act and
effective registration or qualification under applicable state securities laws,
or is made in a transaction that does not require such registration or
qualification. In the event that a transfer is to be made without registration
or qualification (i) the Certificateholder desiring to effect the transfer and
such Certificateholder's prospective transferee shall each execute a
representation letter in the form described by the Agreement certifying to the
Certificate Registrar the facts surrounding the transfer, and (ii) unless such
transfer is made in reliance upon Rule 144A under the 1933 Act, the Depositor
and the Certificate Registrar may require an Opinion of Counsel satisfactory to
them that such transfer may be made without such registration or qualification,
which Opinion of Counsel shall not be an expense of the Depositor, the Trustee
or the Certificate Registrar, in their respective capacities as such. None of
the Depositor, the Certificate Registrar or the Trustee is obligated to register
or qualify the Class of Certificates specified on the face hereof under the 1933
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of such Certificates without
registration or qualification. Any such Certificateholder desiring to effect
such transfer shall, and does hereby agree to, indemnify the Trustee, the
Depositor, the Certificate Registrar and the Servicer against any liability that
may result if the transfer is not so exempt or is not made in accordance with
such federal and state laws.
C-8-4
No transfer of a Certificate or any interest therein may be made to
employee benefit plans and certain other retirement plans and arrangements,
including individual retirement accounts and annuities, Xxxxx plans and
collective investment funds and separate accounts in which such plans, accounts
or arrangements are invested that are subject to the fiduciary responsibility
provisions of ERISA and Section 4975 of the Code ("Plans") or any person who is
directly or indirectly purchasing the Certificate or interest therein on behalf
of, as named fiduciary of, as trustee of, or with assets of a Plan.
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Certificate Registrar may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent nor any such agent shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
C-8-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: January 30, 2006
JPMORGAN CHASE BANK, N.A.
as Trustee
By:
-------------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
JPMORGAN CHASE BANK, N.A.
as Certificate Registrar
By:
-------------------------------------
Authorized Signatory
Date of authentication: January 30, 2006
C-8-6
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
---------
(Cust) (Minor)
TEN ENT - as tenants by the under Uniform
entireties Gifts to Minors
Act
JT TEN - as joint tenants with ---------------
right of survivorship (State)
and not as tenants
in common
Additional abbreviations may also be used though not in the above list.
C-8-7
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto ______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
--------------------------------------------------------------------------------
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to _____________________________________________________________
for the account of ______________________________, account number _____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
______________, the assignee named above, or __________________________________
______________, as its agent.
C-8-8
EXHIBIT C-9
FORM OF CLASS X CERTIFICATES
FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS A
DIRECT OR INDIRECT BENEFICIAL INTEREST IN A "REGULAR INTEREST" IN A
"REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE "CODE") AND THE OBLIGATION TO MAKE CERTAIN
PAYMENTS.
THIS CLASS X CERTIFICATE IS SUBORDINATE TO THE OFFERED CERTIFICATES OF
THIS SERIES TO THE EXTENT DESCRIBED HEREIN AND IN THE AGREEMENT
REFERRED TO HEREIN.
THIS CLASS X CERTIFICATE WILL NOT BE ENTITLED TO PAYMENTS UNTIL SUCH
TIME AS DESCRIBED IN THE AGREEMENT REFERRED TO HEREIN.
THIS CLASS X CERTIFICATE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR THE SECURITIES
LAWS OF ANY STATE. ANY RESALE, TRANSFER OR OTHER DISPOSITION OF THIS
CERTIFICATE WITHOUT SUCH REGISTRATION OR QUALIFICATION MAY BE MADE ONLY
IN A TRANSACTION THAT DOES NOT REQUIRE SUCH REGISTRATION OR
QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF SECTION 5.02 OF
THE AGREEMENT REFERRED TO HEREIN.
EXCEPT AS PROVIDED IN SECTION 5.02(D) OF THE AGREEMENT REFERRED TO
HEREIN, NO TRANSFER OF THIS CERTIFICATE SHALL BE REGISTERED UNLESS THE
TRUSTEE AND THE CERTIFICATE REGISTRAR SHALL HAVE RECEIVED (A) A
REPRESENTATION FROM THE TRANSFEREE OF THIS CERTIFICATE TO THE EFFECT
THAT SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN OR ARRANGEMENT
SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), A PLAN SUBJECT TO SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR A PLAN
SUBJECT TO STATE, LOCAL OR OTHER FEDERAL LAW SUBSTANTIVELY SIMILAR TO
THE FOREGOING PROVISIONS OF ERISA OR THE CODE ("SIMILAR LAW")
(COLLECTIVELY, A "PLAN"), AND IS NOT DIRECTLY OR INDIRECTLY ACQUIRING
THIS CERTIFICATE FOR, ON BEHALF OF OR WITH ANY ASSETS OF ANY SUCH PLAN,
(B) A REPRESENTATION THAT THE TRANSFEREE IS AN INSURANCE COMPANY THAT
IS ACQUIRING THE CERTIFICATE WITH ASSETS OF AN "INSURANCE COMPANY
GENERAL ACCOUNT" AS DEFINED IN SECTION V(E) OF PROHIBITED TRANSACTION
CLASS EXEMPTION ("PTCE") 95-60, AND THE ACQUISITION AND HOLDING OF THE
CERTIFICATE ARE COVERED AND EXEMPT UNDER SECTIONS I AND III OF PTCE
95-60, OR (C) SOLELY IN THE CASE OF A DEFINITIVE CERTIFICATE, AN
OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE AND THE CERTIFICATE
REGISTRAR, AND UPON WHICH THE TRUSTEE AND THE CERTIFICATE REGISTRAR
SHALL BE ENTITLED TO RELY, TO THE EFFECT THAT THE ACQUISITION AND
HOLDING OF THIS CERTIFICATE BY THE TRANSFEREE WILL NOT RESULT IN A
NONEXEMPT PROHIBITED TRANSACTION UNDER TITLE I OF ERISA OR SECTION 4975
OF THE CODE, OR A VIOLATION OF SIMILAR LAW, AND WILL NOT SUBJECT THE
CERTIFICATE REGISTRAR, THE DEPOSITOR, THE SERVICER OR THE TRUSTEE TO
ANY OBLIGATION IN ADDITION TO THOSE UNDERTAKEN BY SUCH ENTITIES IN THE
AGREEMENT REFERRED TO HEREIN, WHICH OPINION OF COUNSEL SHALL NOT BE AN
EXPENSE OF THE CERTIFICATE REGISTRAR, THE DEPOSITOR, THE SERVICER OR
THE TRUSTEE.
C-9-1
OWNIT MORTGAGE LOAN ASSET-BACKED CERTIFICATES
SERIES 2006-1, CLASS X
evidencing a beneficial ownership interest in a portion of a Trust Fund
consisting primarily of a pool of conventional fixed-rate and adjustable-rate
one- to four-family first and second lien mortgage loans formed and sold by
XXXXXXX XXXXX MORTGAGE INVESTORS, INC.
Series 2006-1, Class X Servicer: Xxxxxx Loan Servicing LP
Date of Pooling and Servicing Trustee: JPMorgan Chase Bank, N.A.
Agreement and Cut-off
Date: January 1, 2006
First Distribution Closing Date: January 30, 2006
Date: February 27, 2006
Percentage Interest: 100% CUSIP: 69121P DA 8
No. 1
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN XXXXXXX
XXXXX MORTGAGE INVESTORS, INC., THE SERVICER, THE TRUSTEE OR ANY OF THEIR
AFFILIATES. THIS CERTIFICATE IS NOT GUARANTEED BY ANY AGENCY OR INSTRUMENTALITY
OF THE UNITED STATES.
This certifies that XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX INCORPORATED
is the registered owner of a Percentage Interest set forth above in that certain
beneficial ownership interest evidenced by all the Class X Certificates in the
Trust Fund created pursuant to a Pooling and Servicing Agreement, dated as
specified above (the "Agreement"), among Xxxxxxx Xxxxx Mortgage Investors, Inc.
(hereinafter called the "Depositor," which term includes any successor entity
under the Agreement), Credit-Based Asset Servicing and Securitization LLC (the
"Sponsor"), the Servicer and the Trustee, a summary of certain of the pertinent
provisions of which is set forth hereafter. To the extent not defined herein,
the capitalized terms used herein have the meanings assigned in the Agreement.
This Certificate is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement the Holder of this Certificate
by virtue of the acceptance hereof assents and by which such Holder is bound.
C-9-2
Pursuant to the terms of the Agreement, distributions will be made on
the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (a "Distribution Date"), commencing on the
first Distribution Date specified above, to the Person in whose name this
Certificate is registered on the last Business Day of the month immediately
preceding the month in which the related Distribution Date occurs (the "Record
Date"), from funds in the Distribution Account in an amount equal to the product
of the Percentage Interest evidenced by this Certificate and the amount required
to be distributed to the Holders of Class X Certificates on such Distribution
Date pursuant to the Agreement.
All distributions to the Holder of this Certificate under the Agreement
will be made or caused to be made by or on behalf of the Trustee by wire
transfer in immediately available funds to the account of the Person entitled
thereto if such Person shall have so notified the Certificate Registrar in
writing at least five Business Days prior to the Record Date immediately prior
to such Distribution Date, or by check mailed by first class mail to the address
of the Person entitled thereto, as such name and address shall appear on the
Certificate Register, provided that the Certificate Registrar may deduct a
reasonable wire transfer fee from any payment made by wire transfer.
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office or agency
appointed by the Trustee for that purpose as provided in the Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as Ownit Mortgage Loan Asset-Backed Certificates of the Series
specified on the face hereof (herein called the "Certificates") and representing
the Percentage Interest specified on the face hereof.
The Class X Certificates are limited in right of payment to certain
collections and recoveries respecting the Mortgage Loans, all as more
specifically set forth herein and in the Agreement. As provided in the
Agreement, withdrawals from the Collection Account and the Distribution Account
may be made from time to time for purposes other than distributions to
Certificateholders, such purposes including reimbursement of advances made, or
certain expenses incurred, with respect to the Mortgage Loans.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Depositor, the Servicer, the Trustee, the Sponsor and the rights of the
Certificateholders under the Agreement at any time by the Depositor, the
Servicer, the Sponsor and the Trustee with the consent of the Holders of
Certificates entitled to the Voting Rights identified in the Agreement. Any such
consent by the Holder of this Certificate shall be conclusive and binding on
such Holder and upon all future Holders of this Certificate and of any
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Certificate.
The Agreement also permits the amendment thereof, in certain limited
circumstances, without the consent of the Holders of any of the Certificates.
C-9-3
As provided in the Agreement and subject to certain limitations therein
set forth, the transfer of this Certificate is registrable in the Certificate
Register upon surrender of this Certificate for registration of transfer at the
offices or agencies appointed by the Trustee as provided in the Agreement, duly
endorsed by, or accompanied by an assignment in the form below or other written
instrument of transfer in form satisfactory to the Trustee and the Certificate
Registrar duly executed by, the Holder hereof or such Holder's attorney duly
authorized in writing, and thereupon one or more new Certificates of the same
Class in authorized denominations evidencing the same aggregate Percentage
Interest will be issued to the designated transferee or transferees.
The Certificates are issuable in fully registered form only without
coupons in Classes and denominations representing Percentage Interests specified
in the Agreement. As provided in the Agreement and subject to certain
limitations therein set forth, Certificates are exchangeable for new
Certificates of the same Class in authorized denominations evidencing the same
aggregate Percentage Interest, as requested by the Holder surrendering the same.
No transfer of this Certificate shall be made unless that transfer is
made pursuant to an effective registration statement under the 1933 Act and
effective registration or qualification under applicable state securities laws,
or is made in a transaction that does not require such registration or
qualification. In the event that a transfer is to be made without registration
or qualification (i) the Certificateholder desiring to effect the transfer and
such Certificateholder's prospective transferee shall each execute a
representation letter in the form described by the Agreement certifying to the
Certificate Registrar the facts surrounding the transfer, and (ii) unless such
transfer is made in reliance upon Rule 144A under the 1933 Act, the Depositor
and the Certificate Registrar may require an Opinion of Counsel satisfactory to
them that such transfer may be made without such registration or qualification,
which Opinion of Counsel shall not be an expense of the Depositor, the Trustee
or the Certificate Registrar, in their respective capacities as such. None of
the Depositor, the Certificate Registrar or the Trustee is obligated to register
or qualify the Class of Certificates specified on the face hereof under the 1933
Act or any other securities law or to take any action not otherwise required
under the Agreement to permit the transfer of such Certificates without
registration or qualification. Any such Certificateholder desiring to effect
such transfer shall, and does hereby agree to, indemnify the Trustee, the
Depositor, the Certificate Registrar and the Servicer against any liability that
may result if the transfer is not so exempt or is not made in accordance with
such federal and state laws.
No transfer of a Certificate or any interest therein may be made to
employee benefit plans and certain other retirement plans and arrangements,
including individual retirement accounts and annuities, Xxxxx plans and
collective investment funds and separate accounts in which such plans, accounts
or arrangements are invested that are subject to the fiduciary responsibility
provisions of ERISA and Section 4975 of the Code ("Plans") or any person who is
directly or indirectly purchasing the Certificate or interest therein on behalf
of, as named fiduciary of, as trustee of, or with assets of a Plan.
C-9-4
No service charge will be made for any such registration of transfer or
exchange of Certificates, but the Trustee may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection with any transfer or exchange of Certificates.
The Depositor, the Servicer, the Trustee, any Paying Agent and the
Certificate Registrar and any agent of the Depositor, the Servicer, the Trustee,
any Paying Agent or the Certificate Registrar may treat the Person in whose name
this Certificate is registered as the owner hereof for all purposes, and none of
the Depositor, the Servicer, the Trustee, the Certificate Registrar, any Paying
Agent nor any such agent shall be affected by notice to the contrary.
The obligations created by the Agreement and the Trust Fund created
thereby shall terminate upon payment to the Certificateholders of all amounts
held by or on behalf of the Trustee and required to be paid to them pursuant to
the Agreement following the earlier of (i) the final payment or other
liquidation (or any advance with respect thereto) of the last Mortgage Loan
remaining in the Trust Fund, and (ii) the purchase by the party designated in
the Agreement at a price determined as provided in the Agreement from the Trust
Fund of all Mortgage Loans and all property acquired in respect of such Mortgage
Loans. The Agreement permits, but does not require, the party designated in the
Agreement to purchase from the Trust Fund all Mortgage Loans and all property
acquired in respect of any Mortgage Loan at a price determined as provided in
the Agreement. The exercise of such right will effect early retirement of the
Certificates; however, such right to purchase is subject to the aggregate
Principal Balance of the Mortgage Loans at the time of purchase being 10% or
less of the Cut-off Date Aggregate Principal Balance.
The recitals contained herein shall be taken as statements of the
Depositor and the Trustee assumes no responsibility for their correctness.
Unless the certificate of authentication hereon has been executed by
the Certificate Registrar, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
C-9-5
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be duly
executed.
Dated: January 30, 2006
JPMORGAN CHASE BANK, N.A.
as Trustee
By:
-------------------------------------
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Certificates referred to in the within-mentioned
Agreement.
JPMORGAN CHASE BANK, N.A.
as Certificate Registrar
By:
-------------------------------------
Authorized Signatory
Date of authentication: January 30, 2006
C-9-6
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT - Custodian
---------
(Cust) (Minor)
TEN ENT - as tenants by the under Uniform
entireties Gifts to Minors
Act
JT TEN - as joint tenants with ---------------
right of survivorship (State)
and not as tenants
in common
Additional abbreviations may also be used though not in the above list.
C-9-7
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto ______________________________________________________________
________________________________________________________________________________
(Please print or typewrite name, address including postal zip code, and Taxpayer
Identification Number of assignee)
a Percentage Interest equal to ____% evidenced by the within asset-backed
Certificate and hereby authorize(s) the registration of transfer of such
interest to assignee on the Certificate Register of the Trust Fund.
I (we) further direct the Certificate Registrar to issue a new
Certificate of a like Percentage Interest and Class to the above named assignee
and deliver such Certificate to the following address:
--------------------------------------------------------------------------------
Dated:
-------------------------------------
Signature by or on behalf of assignor
-------------------------------------
Signature Guaranteed
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of distribution:
Distributions shall be made, by wire transfer or otherwise, in immediately
available funds to _____________________________________________________________
for the account of ______________________________, account number _____________,
or, if mailed by check, to ____________________________________________________.
Applicable statements should be mailed to ______________________________________
This information is provided by _______________________________________________,
______________, the assignee named above, or __________________________________
______________, as its agent.
X-0-0
XXXXXXX X-0
MORTGAGE LOAN SCHEDULE FOR GROUP I MORTGAGE LOANS
ON FILE AT THE OFFICES OF DECHERT LLP
XXXX CENTRE
0000 XXXX XXXXXX
XXXXXXXXXXXX, XX 00000
(000) 000-0000
ATTENTION: XXXXXX X. XXXXXXX, ESQUIRE
D-1-1
EXHIBIT D-2
MORTGAGE LOAN SCHEDULE FOR GROUP II MORTGAGE LOANS
ON FILE AT THE OFFICES OF DECHERT LLP
XXXX CENTRE
0000 XXXX XXXXXX
XXXXXXXXXXXX, XX 00000
(000) 000-0000
ATTENTION: XXXXXX X. XXXXXXX, ESQUIRE
D-2-1
EXHIBIT E
FORM OF REQUEST FOR RELEASE OF DOCUMENTS
To: JPMorgan Chase Bank, National Association
0 Xxx Xxxx Xxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Worldwide Securities Services/Structured Finance
Services, Ownit 2006-1 [and/or its designee]
Re: Pooling and Servicing Agreement dated as of January 1, 2006, among
Xxxxxxx Xxxxx Mortgage Investors, Inc., as depositor, Credit-Based
Asset Servicing and Securitization LLC, as sponsor, JPMorgan Chase
Bank, National Association, as trustee and Xxxxxx Loan Servicing LP, as
servicer, relating to Ownit Mortgage Loan Asset-Backed Certificates,
Series 2006-1
In connection with the administration of the Mortgage Loans held by
you, as Trustee, pursuant to the above-captioned Pooling and Servicing
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
Address to which the Trustee should deliver the Mortgage File:
By: ______________________________
(authorized signer)
Address: _________________________
Date: ____________________________
If box 1 or 2 above is checked, and if all or part of the Mortgage File was
previously released to us, please release to us our previous receipt on file
with you, as well as any additional documents in your possession relating to the
above specified Mortgage Loan.
E-1
If box 3, 4, 5 or 6 above is checked, upon our return of all of the above
documents to you as Trustee, please acknowledge your receipt by signing in the
space indicated below, and returning this form.
Please acknowledge the execution of the above request by your signature and date
below:
JPMorgan Chase Bank National Association, as Trustee
By:
---------------------------------- --------------------------------
Signature Date
Documents returned to Trustee:
By:
---------------------------------- --------------------------------
Signature Date
E-2
EXHIBIT F-1
FORM OF CUSTODIAN'S INITIAL CERTIFICATION
Date
Xxxxxxx Xxxxx Mortgage Investors, Inc.
4 World Financial Center, 10th Floor
New York, New York 10080
Xxxxxx Loan Servicing LP
0000 Xxxx Xxxxxxx Xxxxx
Xxxxxxx, Xxxxx 00000
JPMorgan Chase Bank, National Association
0 Xxx Xxxx Xxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Worldwide Securities Services/Structured Finance Services,
Ownit 2006-1 [and/or its designee]
Re: Pooling and Servicing Agreement (the "Pooling and Servicing
Agreement"), dated as of January 1, 2006, among Xxxxxxx Xxxxx
Mortgage Investors, Inc., as depositor, Credit-Based Asset
Servicing and Securitization LLC, as sponsor, Xxxxxx Loan
Servicing LP, as servicer, and JPMorgan Chase Bank, National
Association, as trustee with respect to Ownit Mortgage Loan
Asset-Backed Certificates, Series 2006-1
Ladies and Gentlemen:
In accordance with Section 2.02 of the Pooling and Servicing Agreement,
the undersigned, as Custodian, hereby certifies that it received the documents
listed in Section 2.01 of the Pooling and Servicing Agreement for each Mortgage
File pertaining to each Mortgage Loan listed on Exhibit D-1 and Exhibit D-2, to
the Pooling and Servicing Agreement, subject to any exceptions noted on Schedule
I hereto.
Capitalized words and phrases used herein and not otherwise defined
herein shall have the respective meanings assigned to them in the Pooling and
Servicing Agreement. This Certificate is subject in all respects to the terms of
Section 2.02 of the Pooling and Servicing Agreement and the Pooling and
Servicing Agreement sections cross-referenced therein.
THE BANK OF NEW YORK TRUST COMPANY,
N.A.,
as Custodian
By:
------------------------------------
Name:
Title:
F-1-1
EXHIBIT F-2
FORM OF CUSTODIAN'S FINAL CERTIFICATION
[Date]
Xxxxxxx Xxxxx Mortgage Investors, Inc.
4 World Financial Center, 10th Floor
New York, New York 10080
Xxxxxx Loan Servicing LP
0000 Xxxx Xxxxxxx Xxxxx
Xxxxxxx, Xxxxx 00000
JPMorgan Chase Bank, National Association
0 Xxx Xxxx Xxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Worldwide Securities Services/Structured Finance Services,
Ownit 2006-1 [and/or its designee]
Re: Pooling and Servicing Agreement (the "Pooling and Servicing
Agreement"), dated as of January 1, 2006, among Xxxxxxx Xxxxx Mortgage
Investors, Inc., as depositor, Credit-Based Asset Servicing and
Securitization LLC, as sponsor, Xxxxxx Loan Servicing LP, as servicer,
and JPMorgan Chase Bank National Association, as trustee, with respect
to Ownit Mortgage Loan Asset-Backed Certificates, Series 2006-1
Ladies and Gentlemen:
In accordance with Section 2.02 of the Pooling and Servicing Agreement,
the undersigned, as Custodian, hereby certifies that as to each Mortgage Loan
listed in the Mortgage Loan Schedule (other than any Mortgage Loan paid in full
or listed on Schedule I hereto) it has received the applicable documents listed
in Section 2.01 of the Pooling and Servicing Agreement.
The undersigned hereby certifies that as to each Mortgage Loan
identified on the Mortgage Loan Schedule, other than any Mortgage Loan listed on
Schedule I hereto, it has reviewed the documents listed above and has determined
that each such document appears to be complete and, based on an examination of
such documents, the information set forth in the Mortgage Loan Schedule is
correct.
Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the Pooling and Servicing Agreement. This
Certificate is qualified in all respects by the terms of said Pooling and
Servicing Agreement.
THE BANK OF NEW YORK TRUST COMPANY,
N.A.,
as Custodian
By:
---------------------------------
Name:
Title:
F-2-1
EXHIBIT F-3
FORM OF RECEIPT OF MORTGAGE NOTE
Date
Xxxxxxx Xxxxx Mortgage Investors, Inc.
4 World Financial Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Ownit Mortgage Loan Asset-Backed Certificates, Series 2006-1
Ladies and Gentlemen:
Pursuant to Section 2.01 of the Pooling and Servicing Agreement, dated
as of January 1, 2006, among Xxxxxxx Xxxxx Mortgage Investors, Inc., as
depositor, Credit-Based Asset Servicing and Securitization LLC, as sponsor,
Xxxxxx Loan Servicing LP, as servicer, and JPMorgan Chase Bank, National
Association, as trustee, we hereby acknowledge the receipt of the original
Mortgage Note (a copy of which is attached hereto as Exhibit 1) with any
exceptions thereto listed on Exhibit 2.
THE BANK OF NEW YORK TRUST COMPANY,
N.A.,
as Trustee
By:
-----------------------------------
Name:
Title:
F-3-1
EXHIBIT G
MORTGAGE LOAN PURCHASE AGREEMENT
[Intentionally Omitted]
G-1
EXHIBIT H
FORM OF LOST NOTE AFFIDAVIT
Personally appeared before me the undersigned authority to administer
oaths, ______________________ who first being duly sworn deposes and says:
Deponent is ______________________ of ______________________________, successor
by merger to _________________________________________ ("Seller") and who has
personal knowledge of the facts set out in this affidavit.
On ___________________, _________________________ did execute and
deliver a promissory note in the principal amount of $__________.
That said note has been misplaced or lost through causes unknown and is
presently lost and unavailable after diligent search has been made. Seller's
records show that an amount of principal and interest on said note is still
presently outstanding, due, and unpaid, and Seller is still owner and holder in
due course of said lost note.
Seller executes this Affidavit for the purpose of inducing JPMorgan
Chase Bank, National Association, as trustee on behalf of Ownit Mortgage Loan
Asset-Backed Certificates, Series 2006-1 to accept the transfer of the above
described loan from Seller.
Seller agrees to indemnify and hold harmless JPMorgan Chase Bank,
National Association and Xxxxxxx Xxxxx Mortgage Investors, Inc. for any losses,
liabilities, costs and expenses incurred by such parties resulting from the
above described promissory note having been lost or misplaced.
By:
STATE OF )
) SS:
COUNTY OF )
On this ____ day of _______ 20__, before me, a Notary Public, in and
for said County and State, appeared ________________________, who acknowledged
the extension of the foregoing and who, having been duly sworn, states that any
representations therein contained are true.
Witness my hand and Notarial Seal this ____ day of _______ 20__.
My commission expires ______________.
H-1
EXHIBIT I
FORM OF ERISA REPRESENTATION
Date
JPMorgan Chase Bank, National Association
0 Xxx Xxxx Xxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Worldwide Securities Services/Structured Finance Services,
Ownit 2006-1
[and/or its designee]
Xxxxxxx Xxxxx Mortgage Investors, Inc.
4 World Financial Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Ownit Mortgage Loan Asset-Backed Certificates, Series 2006-1
Ladies and Gentlemen:
1. [The undersigned is the ______________________ of (the "Transferee")
a [corporation duly organized] and existing under the laws of __________, on
behalf of which he makes this affidavit.] [The undersigned, ___________________,
is the transferee (the "Transferee").]
2. The Transferee hereby acknowledges that under the terms of the
Pooling and Servicing Agreement (the "Agreement") among Xxxxxxx Xxxxx Mortgage
Investors, Inc., as depositor (the "Depositor"), Credit-Based Asset Servicing
and Securitization LLC, as sponsor, Xxxxxx Loan Servicing LP, as servicer, and
JPMorgan Chase Bank, National Association, as trustee (the "Trustee"), no
transfer of the ERISA-Restricted Certificates (other than the Class R and Class
R-X Certificates) shall be permitted to be made to any person unless the
Depositor and the Certificate Registrar (as defined in the Agreement) have
received a certificate from such transferee in the form hereof.
3. The Transferee (i) is not an employee benefit plan or arrangement
subject to Title I of the Employee Retirement Income Security Act of 1974, as
amended ("ERISA"), a plan subject to Section 4975 of the Internal Revenue Code
of 1986, as amended (the "Code") or a plan subject to any state, local, federal,
non-U.S. or other law substantively similar to the foregoing provisions of ERISA
or the Code ("Similar Law") (collectively, a "Plan"), and is not directly or
indirectly acquiring the Certificate for, on behalf of or with any assets of any
such Plan, (ii) if the Certificate has been the subject of an ERISA-Qualifying
Underwriting, is an insurance company that is acquiring the Certificate with
assets of an "insurance company general account" as defined in Section V(e) of
Prohibited Transaction Class Exemption ("PTCE") 95-60 and the acquisition and
holding of the Certificate are covered and exempt under Sections I and III of
PTCE 95-60, or (iii) solely in the case of a Definitive Certificate, will
deliver herewith an Opinion of Counsel satisfactory to the Trustee and the
Certificate Registrar, and upon which the Trustee and the Certificate Registrar
shall be entitled to rely, to the effect that the acquisition and holding of
such Certificate by the transferee will not result in a nonexempt prohibited
transaction under Title I of ERISA or Section 4975 of the Code, or a violation
of Similar Law, and will not subject the Certificate Registrar, the Depositor,
the Servicer or the Trustee 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 Certificate Registrar, the Depositor, the
Servicer or the Trustee.
I-1
Capitalized terms used but not defined herein shall have the meanings
ascribed to such terms in the Agreement.
IN WITNESS WHEREOF, the Transferee has executed this certificate.
[Transferee]
By:
-----------------------------------------
Name:
Title:
I-2
EXHIBIT J
FORMS OF INVESTMENT LETTERS
FORM OF INVESTMENT LETTER [NON-RULE 144A]
[DATE]
Xxxxxxx Xxxxx Mortgage Investors, Inc.
4 World Financial Center, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
JPMorgan Chase Bank, National Association
0 Xxx Xxxx Xxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Worldwide Securities Services/Structured Finance Services,
Ownit 2006-1
[and/or its designee]
Re: Ownit Mortgage Loan Asset-Backed Certificates, Series 2006-1
Ladies and Gentlemen:
In connection with our acquisition of the Ownit Mortgage Loan
Asset-Backed Certificates, Series 2006-1 (the "Certificates"), we certify that
(a) we understand that the Certificates are not being registered under the
Securities Act of 1933, as amended (the "Act"), or any state securities laws and
are being transferred to us in a transaction that is exempt from the
registration requirements of the Act and any such laws, (b) we are an
"accredited investor," as defined in Regulation D under the Act, and have such
knowledge and experience in financial and business matters that we are capable
of evaluating the merits and risks of investments in the Certificates, (c) we
have had the opportunity to ask questions of and receive answers from the
Depositor concerning the purchase of the Certificates and all matters relating
thereto or any additional information deemed necessary to our decision to
purchase the Certificates, (d) we are acquiring the Certificates for investment
for our own account and not with a view to any distribution of such Certificates
(but without prejudice to our right at all times to sell or otherwise dispose of
the Certificates in accordance with clause (g) below), (e) we agree that the
Certificates must be held indefinitely by us and we acknowledge that we are able
to bear the economic risk of investment in the Certificates, (f) we have not
offered or sold any Certificates to, or solicited offers to buy any Certificates
from, any person, or otherwise approached or negotiated with any person with
respect thereto, or taken any other action which would result in a violation of
Section 5 of the Act, (g) we will not sell, transfer or otherwise dispose of any
Certificates unless (1) such sale, transfer or other disposition is made
pursuant to an effective registration statement under the Act or is exempt from
such registration requirements, and if requested, we will at our expense provide
an opinion of counsel satisfactory to the addressees of this Certificate that
such sale, transfer or other disposition may be made pursuant to an exemption
from the Act, (2) the purchaser or transferee of such Certificate has executed
and delivered to you a certificate to substantially the same effect as this
certificate, and (3) the purchaser or transferee has otherwise complied with any
conditions for transfer set forth in the Pooling and Servicing Agreement and (h)
we acknowledge that the Certificates will bear a legend setting forth the
applicable restrictions on transfer.
Very truly yours,
[NAME OF TRANSFEREE]
By:
-------------------------------------
Authorized Officer
J-1
FORM OF INVESTMENT LETTER [RULE 144A]
[DATE]
Xxxxxxx Xxxxx Mortgage Investors, Inc.
4 World Financial Center, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
JPMorgan Chase Bank, National Association
0 Xxx Xxxx Xxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Worldwide Securities Services/Structured Finance Services,
Ownit 2006-1
[and/or its designee]
Re: Ownit Mortgage Loan Asset-Backed Certificates, Series 2006-1
Ladies and Gentlemen:
In connection with our acquisition of the Ownit Mortgage Loan
Asset-Backed Certificates, Series 2006-1 (the "Certificates"), we certify that
(a) we understand that the Certificates are not being registered under the
Securities Act of 1933, as amended (the "Act"), or any state securities laws and
are being transferred to us in a transaction that is exempt from the
registration requirements of the Act and any such laws, (b) we have had the
opportunity to ask questions of and receive answers from the Depositor
concerning the purchase of the Certificates and all matters relating thereto or
any additional information deemed necessary to our decision to purchase the
Certificates, (c) we have not, nor has anyone acting on our behalf offered,
transferred, pledged, sold or otherwise disposed of the Certificates, any
interest in the Certificates or any other similar security to, or solicited any
offer to buy or accept a transfer, pledge or other disposition of the
Certificates, any interest in the Certificates or any other similar security
from, or otherwise approached or negotiated with respect to the Certificates,
any interest in the Certificates or any other similar security with, any person
in any manner, or made any general solicitation by means of general advertising
or in any other manner, or taken any other action, that would constitute a
distribution of the Certificates under the Securities Act or that would render
the disposition of the Certificates a violation of Section 5 of the Securities
Act or require registration pursuant thereto, nor will act, nor has authorized
or will authorize any person to act, in such manner with respect to the
Certificates, (d) we are a "qualified institutional buyer" as that term is
defined in Rule 144A under the Securities Act and have completed either of the
forms of certification to that effect attached hereto as Annex 1 or Annex 2. We
are aware that the sale to us is being made in reliance on Rule 144A. We are
acquiring the Certificates for our own account or for resale pursuant to Rule
144A and further, understand that such Certificates may be resold, pledged or
transferred only (i) to a person reasonably believed to be a qualified
institutional buyer that purchases for its own account or for the account of a
qualified institutional buyer to whom notice is given that the resale, pledge or
transfer is being made in reliance on Rule 144A, or (ii) pursuant to another
exemption from registration under the Securities Act.
Very truly yours,
[NAME OF TRANSFEREE]
By:
-----------------------------------------
Authorized Officer
J-2
ANNEX 1 TO EXHIBIT J
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees Other Than Registered Investment Companies]
The undersigned (the "Buyer") hereby certifies as follows to the
parties listed in the Rule 144A Transferee Certificate to which this
certification relates with respect to the Certificates described therein:
1. As indicated below, the undersigned is the President, Chief
Financial Officer, Senior Vice President or other executive officer of the
Buyer.
2. In connection with purchases by the Buyer, the Buyer is a "qualified
institutional buyer" as that term is defined in Rule 144A under the Securities
Act of 1933, as amended ("Rule 144A") because (i) the Buyer owned and/or
invested on a discretionary basis $_____(1) in securities (except for the
excluded securities referred to below) as of the end of the Buyer's most recent
fiscal year (such amount being calculated in accordance with Rule 144A and (ii)
the Buyer satisfies the criteria in the category marked below.
___ Corporation, etc. The Buyer is a corporation (other than a bank,
savings and loan association or similar institution), Massachusetts
or similar business trust, partnership, or charitable organization
described in Section 501(c)(3) of the Internal Revenue Code of 1986,
as amended.
___ Bank. The Buyer (a) is a national bank or banking institution
organized under the laws of any State, territory or the District of
Columbia, the business of which is substantially confined to banking
and is supervised by the State or territorial banking commission or
similar official or is a foreign bank or equivalent institution, and
(b) has an audited net worth of at least $25,000,000 as demonstrated
in its latest annual financial statements, a copy of which is
attached hereto.
___ Savings and Loan. The Buyer (a) is a savings and loan
association, building and loan association, cooperative bank,
homestead association or similar institution, which is supervised
and examined by a State or Federal authority having supervision over
any such institutions or is a foreign savings and loan association
or equivalent institution and (b) has an audited net worth of at
least $25,000,000 as demonstrated in its latest annual financial
statements, a copy of which is attached hereto.
___ Broker-dealer. The Buyer is a dealer registered pursuant to
Section 15 of the Securities Exchange Act of 1934.
___ Insurance Company. The Buyer is an insurance company whose
primary and predominant business activity is the writing of
insurance or the reinsuring of risks underwritten by insurance
companies and which is subject to supervision by the insurance
commissioner or a similar official or agency of a State, territory
or the District of Columbia.
-------------
(1) Buyer must own and/or invest on a discretionary basis at least $______
in securities unless Buyer is a dealer, and, in that case, Buyer must
own and/or invest on a discretionary basis at least $______ in
securities.
J-3
___ State or Local Plan. The Buyer is a plan established and
maintained by a State, its political subdivisions, or any agency or
instrumentality of the State or its political subdivisions, for the
benefit of its employees.
___ ERISA Plan. The Buyer is an employee benefit plan within the
meaning of Title I of the Employee Retirement Income Security Act of
1974.
___ Investment Advisor. The Buyer is an investment advisor
registered under the Investment Advisors Act of 1940.
___ Small Business Investment Company. Buyer is a small business
investment company licensed by the U.S. Small Business
Administration under Section 301(c) or (d) of the Small Business
Investment Act of 1958.
___ Business Development Company. Buyer is a business development
company as defined in Section 202(a)(22) of the Investment Advisors
Act of 1940.
3. The term "securities" as used herein does not include (i) securities
of issuers that are affiliated with the Buyer, (ii) securities that are part of
an unsold allotment to or subscription by the Buyer, if the Buyer is a dealer,
(iii) securities issued or guaranteed by the U.S. or any instrumentality
thereof, (iv) bank deposit notes and certificates of deposit, (v) loan
participations, (vi) repurchase agreements, (vii) securities owned but subject
to a repurchase agreement and (viii) currency, interest rate and commodity
swaps.
4. For purposes of determining the aggregate amount of securities owned
and/or invested on a discretionary basis by the Buyer, the Buyer used the cost
of such securities to the Buyer and did not include any of the securities
referred to in the preceding paragraph, except (i) where the Buyer reports its
securities holdings in its financial statements on the basis of their market
value, and (ii) no current information with respect to the cost of those
securities has been published. If clause (ii) in the preceding sentence applies,
the securities may be valued at market. Further, in determining such aggregate
amount, the Buyer may have included securities owned by subsidiaries of the
Buyer, but only if such subsidiaries are consolidated with the Buyer in its
financial statements prepared in accordance with generally accepted accounting
principles and if the investments of such subsidiaries are managed under the
Buyer's direction. However, such securities were not included if the Buyer is a
majority-owned, consolidated subsidiary of another enterprise and the Buyer is
not itself a reporting company under the Securities Exchange Act of 1934, as
amended.
5. The Buyer acknowledges that it is familiar with Rule 144A and
understands that the seller to it and other parties related to the Certificates
are relying and will continue to rely on the statements made herein because one
or more sales to the Buyer may be in reliance on Rule 144A.
6. Until the date of purchase of the Rule 144A Securities, the Buyer
will notify each of the parties to which this certification is made of any
changes in the information and conclusions herein. Until such notice is given,
the Buyer's purchase of the Certificates will constitute a reaffirmation of this
certification as of the date of such purchase. In addition, if the Buyer is a
bank or savings and loan is provided above, the Buyer agrees that it will
furnish to such parties updated annual financial statements promptly after they
become available.
J-4
Print Name of Buyer
By:
--------------------------------------
Name:
Title:
Date:
------------------------------------
J-5
ANNEX 2 TO EXHIBIT J
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Transferees That are Registered Investment Companies]
The undersigned (the "Buyer") hereby certifies as follows to the
parties listed in the Rule 144A Transferee Certificate to which this
certification relates with respect to the Certificates described therein:
1. As indicated below, the undersigned is the President, Chief
Financial Officer or Senior Vice President of the Buyer or, if the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under the
Securities Act of 1933, as amended ("Rule 144A") because Buyer is part of a
Family of Investment Companies (as defined below), is such an officer of the
Adviser.
2. In connection with purchases by Buyer, the Buyer is a "qualified
institutional buyer" as defined in SEC Rule 144A because (i) the Buyer is an
investment company registered under the Investment Company Act of 1940, as
amended and (ii) as marked below, the Buyer alone, or the Buyer's Family of
Investment Companies, owned at least $100,000,000 in securities (other than the
excluded securities referred to below) as of the end of the Buyer's most recent
fiscal year. For purposes of determining the amount of securities owned by the
Buyer or the Buyer's Family of Investment Companies, the cost of such securities
was used, except (i) where the Buyer or the Buyer's Family of Investment
Companies reports its securities holdings in its financial statements on the
basis of their market value, and (ii) no current information with respect to the
cost of those securities has been published. If clause (ii) in the preceding
sentence applies, the securities may be valued at market.
___ The Buyer owned $______ in securities (other than the excluded
securities referred to below) as of the end of the Buyer's most
recent fiscal year (such amount being calculated in accordance with
Rule 144A).
___ The Buyer is part of a Family of Investment Companies which
owned in the aggregate $______ in securities (other than the
excluded securities referred to below) as of the end of the Buyer's
most recent fiscal year (such amount being calculated in accordance
with Rule 144A).
3. The term "Family of Investment Companies" as used herein means two
or more registered investment companies (or series thereof) that have the same
investment adviser or investment advisers that are affiliated (by virtue of
being majority owned subsidiaries of the same parent or because one investment
adviser is a majority owned subsidiary of the other).
4. The term "securities" as used herein does not include (i) securities
of issuers that are affiliated with the Buyer or are part of the Buyer's Family
of Investment Companies, (ii) securities issued or guaranteed by the U.S. or any
instrumentality thereof, (iii) bank deposit notes and certificates of deposit,
(iv) loan participations, (v) repurchase agreements, (vi) securities owned but
subject to a repurchase agreement and (vii) currency, interest rate and
commodity swaps.
5. The Buyer is familiar with Rule 144A and understands that the
parties listed in the Rule 144A Transferee Certificate to which this
certification relates are relying and will continue to rely on the statements
made herein because one or more sales to the Buyer will be in reliance on Rule
144A. In addition, the Buyer will only purchase for the Buyer's own account.
J-6
6. Until the date of purchase of the Certificates, the undersigned will
notify the parties listed in the Rule 144A Transferee Certificate to which this
certification relates of any changes in the information and conclusions herein.
Until such notice is given, the Buyer's purchase of the Certificates will
constitute a reaffirmation of this certification by the undersigned as of the
date of such purchase.
Print Name of Buyer or Adviser
By:
--------------------------------------
Name:
Title:
IF AN ADVISER:
Print Name of Buyer
Date:
------------------------------------
J-7
EXHIBIT K
FORM OF RESIDUAL CERTIFICATE TRANSFER AFFIDAVIT
OWNIT MORTGAGE LOAN ASSET-BACKED CERTIFICATES, SERIES 2006-1
STATE OF )
)ss.:
COUNTY OF )
The undersigned, being first duly sworn, deposes and says as follows:
1. The undersigned is [an officer of] ______________, the proposed
Transferee of an Ownership Interest in a [Class R and/or Class R-X Certificates]
(the "Residual Certificate") issued pursuant to the Pooling and Servicing
Agreement, (the "Agreement"), relating to the above-referenced Certificates,
among Xxxxxxx Xxxxx Mortgage Investors, Inc., as depositor, Credit-Based Asset
Servicing and Securitization LLC, as sponsor, Xxxxxx Loan Servicing LP, as
servicer, and JPMorgan Chase Bank, National Association, as trustee (the
"Trustee"). Capitalized terms used, but not defined herein shall have the
meanings ascribed to such terms in the Agreement. The Transferee has authorized
the undersigned to make this affidavit on behalf of the Transferee.
2. The Transferee is, as of the date hereof, and will be, as of the
date of the transfer, a Permitted Transferee. The Transferee is acquiring the
Residual Certificate either (i) for its own account or (ii) as nominee, trustee
or agent for another Person who is a Permitted Transferee and has attached
hereto an affidavit from such Person in substantially the same form as this
affidavit. The Transferee has no knowledge that any such affidavit is false.
3. The Transferee has been advised of, and understands that (i) a tax
will be imposed on Transfers of the Residual Certificate to Persons that are not
Permitted Transferees; (ii) such tax will be imposed on the transferor, or, if
such transfer is through an agent (which includes a broker, nominee or
middleman) for a Person that is not a Permitted Transferee, on the agent; and
(iii) the Person otherwise liable for the tax shall be relieved of liability for
the tax if the subsequent Transferee furnished to such Person an affidavit that
such subsequent Transferee is a Permitted Transferee and, at the time of
transfer, such Person does not have actual knowledge that the affidavit is
false.
4. The Transferee has been advised of, and understands that a tax will
be imposed on a "pass-through entity" holding the Certificate if at any time
during the taxable year of the pass-through entity a Person that is not a
Permitted Transferee is the record Holder of an interest in such entity. The
Transferee understands that, other than in the case of an "electing large
partnership" under Section 775 of the Code, such tax will not be imposed for any
period with respect to which the record Holder furnishes to the pass-through
entity an affidavit that such record Holder is a Permitted Transferee and the
pass-through entity does not have actual knowledge that such affidavit is false.
(For this purpose, a "pass-through entity" includes a regulated investment
company, a real estate investment trust or common trust fund, a partnership,
trust or estate, and certain cooperatives and, except as may be provided in
Treasury Regulations, persons holding interests in pass-through entities as a
nominee for another Person.)
5. The Transferee has reviewed the provisions of Section 5.02 of the
Agreement and understands the legal consequences of the acquisition of the
Residual Certificate including, without limitation, the restrictions on
subsequent Transfers and the provisions regarding voiding the transfer and
mandatory sales. The Transferee expressly agrees to be bound by and to abide by
the provisions of Section 5.02 of the Agreement and the restrictions noted on
the face of the Certificate. The Transferee understands and agrees that any
breach of any of the representations included herein shall render the transfer
to the Transferee contemplated hereby null and void.
K-1
6. The Transferee agrees to require a transfer affidavit in the form of
this Affidavit from any Person to whom the Transferee attempts to transfer the
Residual Certificate, and in connection with any transfer by a Person for whom
the Transferee is acting as nominee, trustee or agent, and the Transferee will
not transfer the Residual Certificate or cause the Residual Certificate to be
transferred to any Person that the Transferee knows is not a Permitted
Transferee.
7. The Transferee historically has paid its debts as they have become
due.
8. The Transferee does not have the intention to impede the assessment
or collection of any tax legally required to be paid with respect to the
Residual Certificate.
9. The taxpayer identification number of the Transferee's nominee is
___________.
10. The Transferee is a U.S. Person as defined in Code Section
7701(a)(30).
11. The Transferee is aware that the Residual Certificate may be a
"noneconomic residual interest" within the meaning of Treasury Regulations
promulgated pursuant to the Code and that the transferor of a noneconomic
residual interest will remain liable for any taxes due with respect to the
income on such residual interest, unless no significant purpose of the transfer
was to impede the assessment or collection of tax.
12. The Transferee will not cause income from the Residual Certificate
to be attributable to a foreign permanent establishment or fixed base, within
the meaning of an applicable income tax treaty, of the Transferee or any other
person.
13. If the Transferee is purchasing the Residual Certificate in a
transfer intended to meet the safe harbor provisions of Treasury Regulations
Sections 1.860E-1(c), the Transferee has executed and attached Attachment A
hereto.
14. The Transferee is not an employee benefit plan or arrangement
subject to Title I of ERISA, a plan subject to Section 4975 of the Code or a
plan subject to any state, local or other federal law substantively similar to
the foregoing provisions of ERISA or the Code (collectively, a "Plan"), and is
not directly or indirectly acquiring this Certificate for, on behalf of or with
any assets of any such Plan.
* * *
K-2
IN WITNESS WHEREOF, the Transferee has caused this instrument to be
executed on its behalf, pursuant to authority of its Board of Directors, by its
duly authorized officer this _____ day of ________________, ____.
Print Name of Transferee
By:
---------------------------------------
Name:
Title:
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
Transferee, and acknowledged that he executed the same as his free act and deed
and the free act and deed of the Transferee.
Subscribed and sworn before me this _____ day of _____________________,
____
NOTARY PUBLIC
My Commission expires the ____ day of
______________, ____
K-3
ATTACHMENT A
to
AFFIDAVIT PURSUANT TO SECTION 860E(E)(4) OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED, AND FOR NON-ERISA INVESTORS
Check the appropriate box:
|_| The consideration paid to the Transferee to acquire the Residual
Certificate equals or exceeds the excess of (a) the present value of
the anticipated tax liabilities over (b) the present value of the
anticipated savings associated with holding such Residual Certificate,
in each case calculated in accordance with U.S. Treasury Regulations
Sections 1.860E-1(c)(7) and (8), computing present values using a
discount rate equal to the short-term Federal rate prescribed by
Section 1274(d) of the Code and the compounding period used by the
Transferee.
OR
|_| The transfer of the Residual Certificate complies with U.S. Treasury
Regulations Sections 1.860E-1(c)(5) and (6) and, accordingly:
(i) the Transferee is an "eligible corporation," as defined in
U.S. Treasury Regulations Section 1.860E-1(c)(6)(i), as to
which income from Residual Certificate will only be taxed in
the United States;
(ii) at the time of the transfer, and at the close of the
Transferee's two fiscal years preceding the year of the
transfer, the Transferee had gross assets for financial
reporting purposes (excluding any obligation of a person
related to the Transferee within the meaning of U.S. Treasury
Regulations Section 1.860E-1(c)(6)(ii)) in excess of $100
million and net assets in excess of $10 million;
(iii) the Transferee will transfer the Residual Certificate only to
another "eligible corporation," as defined in U.S. Treasury
Regulations Section 1.860E-1(c)(6)(i), in a transaction that
satisfies the requirements of Sections 1.860E-1(c)(4)(i), (ii)
and (iii) and Section 1.860E-1(c)(5) of the U.S. Treasury
Regulations;
(iv) the Transferee has determined the consideration paid to it to
acquire the Residual Certificate based on reasonable market
assumptions (including, but not limited to, borrowing and
investment rates, prepayment and loss assumptions, expense and
reinvestment assumptions, tax rates and other factors specific
to the Transferee) that it has determined in good faith; and
(v) in the event of any transfer of the Residual Certificate by
the Transferee, the Transferee will require its transferee to
complete a representation in the form of this Attachment A as
a condition of such transferee's purchase of the Residual
Certificate.
K-4
EXHIBIT L
FORM OF TRANSFEROR CERTIFICATE
[DATE]
Xxxxxxx Xxxxx Mortgage Investors, Inc.
4 World Financial Center, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
JPMorgan Chase Bank, National Association
0 Xxx Xxxx Xxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Worldwide Securities Services/Structured Finance Services,
Ownit 2006-1 [and/or its designee]
Re: Ownit Mortgage Loan Asset-Backed Certificates, Series 2006-1
Ladies and Gentlemen:
In connection with our disposition of the Ownit Mortgage Loan
Asset-Backed Certificates, Series 2006-1 (the "Certificates"), we certify that
(a) we understand that the Certificates have not been registered under the
Securities Act of 1933, as amended (the "Act"), and are being disposed by us in
a transaction that is exempt from the registration requirements of the Act, (b)
we have not offered or sold any Certificates to, or solicited offers to buy any
Certificates from, any person, or otherwise approached or negotiated with any
person with respect thereto, in a manner that would be deemed, or taken any
other action which would result in, a violation of Section 5 of the Act, (c) to
the extent we are disposing of a Class [R]R-X] Certificate, we have no knowledge
the Transferee is not a Permitted Transferee and (d) no purpose of the proposed
disposition of a Class [R][R-X] Certificate is to impede the assessment or
collection of tax.
Very truly yours,
[---------------------]
By: ______________________________
L-1
EXHIBIT M
MONTHLY INFORMATION DELIVERED BY SERVICER
1. With respect to the Mortgage Pool and each Loan Group, the number and
Principal Balances of all Mortgage Loans which were the subject of
Principal Prepayments during the related Prepayment Period.
2. With respect to the Mortgage Pool and each Loan Group, the amount of all
partial Principal Prepayments received by the Servicer during the related
Prepayment Period.
3. With respect to the Mortgage Pool and each Loan Group, the aggregate amount
of principal portion of all Monthly Payments received during the related
Collection Period.
4. With respect to the Mortgage Pool and each Loan Group, the amount of
interest received on the Mortgage Loans during the related Collection
Period.
5. With respect to the Mortgage Pool and each Loan Group, the aggregate amount
of the Advances made and recovered with respect to such Distribution Date.
6. With respect to the Mortgage Pool and each Loan Group, the delinquency and
foreclosure information and the amount of Mortgage Loan Losses as of the
close of business of the last day of the preceding Collection Period.
7. With respect to the Mortgage Pool and each Loan Group, the weighted average
maturity, the weighted average Mortgage Interest Rate and the weighted
average Net Mortgage Interest Rate as of the last day of the preceding
Collection Period preceding of the related Interest Accrual Period.
8. The Servicing Fees paid and Servicing Fees accrued during the related
Collection Period.
9. The amount of all payments or reimbursements to the Servicer paid or to be
paid since the prior Distribution Date (or in the case of the first
Distribution Date, since the Closing Date).
10. The Pool Balance and aggregate Principal Balance for each Loan Group.
11. With respect to the Mortgage Pool and each Loan Group, the number of
Mortgage Loans outstanding at the beginning and at the end of the related
Collection Period.
12. The aggregate interest accrued on the Mortgage Loans at their respective
Mortgage Interest Rates for the related Collection Period.
13. The amount deposited in the Collection Account that may not be withdrawn
therefrom pursuant to an order of a United States Bankruptcy Court of
competent jurisdiction imposing a stay pursuant to Section 362 of the
Bankruptcy Code.
14. The aggregate Realized Losses since the Cut-off Date as of the end of the
related Collection Period.
M-1
EXHIBIT N-1
FORM OF GROUP I SENIOR CAP CONTRACT
[Intentionally Omitted]
N-1-1
EXHIBIT N-2
FORM OF MEZZANINE CAP CONTRACT
[Intentionally Omitted]
N-2-1
EXHIBIT O
FORM OF POWER OF ATTORNEY
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO
XXXXXX LOAN SERVICING LP
0000 Xxxx Xxxxxxx Xxxxx
Xxxxxxx, Xxxxx 00000
Attn: _________________________________
LIMITED POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that , having its principal place of business at
, as Trustee (the "Trustee") pursuant to that Pooling and Servicing Agreement
among Xxxxxxx Xxxxx Mortgage Investors, Inc. (the "Depositor"), Xxxxxx Loan
Servicing LP (the "Servicer"), Credit-Based Asset Servicing and Securitization
LLC (the "Sponsor") and the Trustee, dated as of January 1, 2006 (the "Pooling
and Servicing Agreement"), hereby constitutes and appoints the Servicer, by and
through the Servicer's officers, the Trustee's true and lawful Attorney-in-Fact,
in the Trustee's name, place and stead and for the Trustee's benefit, in
connection with all mortgage loans serviced by the Servicer pursuant to the
Pooling and Servicing Agreement for the purpose of performing all acts and
executing all documents in the name of the Trustee as may be customarily and
reasonably necessary and appropriate to effectuate the following enumerated
transactions in respect of any of the mortgages or deeds of trust (the
"Mortgages" and the "Deeds of Trust", respectively) and promissory notes secured
thereby (the "Mortgage Notes") for which the undersigned is acting as Trustee
for various certificateholders (whether the undersigned is named therein as
mortgagee or beneficiary or has become mortgagee by virtue of endorsement of the
Mortgage Note secured by any such Mortgage or Deed of Trust) and for which the
Servicer is acting as servicer, all subject to the terms of the Pooling and
Servicing Agreement.
This appointment shall apply to the following enumerated transactions only:
1. The modification or re-recording of a Mortgage or Deed of Trust, where said
modification or re-recordings is for the purpose of correcting the Mortgage
or Deed of Trust to conform same to the original intent of the parties
thereto or to correct title errors discovered after such title insurance
was issued and said modification or re-recording, in either instance, does
not adversely affect the lien of the Mortgage or Deed of Trust as insured.
2. The subordination of the lien of a Mortgage or Deed of Trust to an easement
in favor of a public utility company of a government agency or unit with
powers of eminent domain; this section shall include, without limitation,
the execution of partial satisfactions/releases, partial reconveyances or
the execution or requests to trustees to accomplish same.
3. The conveyance of the properties to the mortgage insurer, or the closing of
the title to the property to be acquired as real estate owned, or
conveyance of title to real estate owned.
4. The completion of loan assumption agreements.
O-1
5. The full satisfaction/release of a Mortgage or Deed of Trust or full
conveyance upon payment and discharge of all sums secured thereby,
including, without limitation, cancellation of the related Mortgage Note.
6. The assignment of any Mortgage or Deed of Trust and the related Mortgage
Note, in connection with the repurchase of the mortgage loan secured and
evidenced thereby.
7. The full assignment of a Mortgage or Deed of Trust upon payment and
discharge of all sums secured thereby in conjunction with the refinancing
thereof, including, without limitation, the assignment of the related
Mortgage Note.
8. With respect to a Mortgage or Deed of Trust, the foreclosure, the taking of
a deed in lieu of foreclosure, or the completion of judicial or
non-judicial foreclosure or termination, cancellation or rescission of any
such foreclosure, including, without limitation, any and all of the
following acts:
a. the substitution of trustee(s) serving under a Deed of Trust, in
accordance with state law and the Deed of Trust;
b. the preparation and issuance of statements of breach or
non-performance;
c. the preparation and filing of notices of default and/or notices of
sale;
d. the cancellation/rescission of notices of default and/or notices of
sale;
e. the taking of a deed in lieu of foreclosure; and
f. the preparation and execution of such other documents and performance
of such other actions as may be necessary under the terms of the
Mortgage, Deed of Trust or state law to expeditiously complete said
transactions in paragraphs 8.a. through 8.e., above.
This Power of Attorney is effective for one (1) year from the date hereof or the
earlier of (i) revocation by the Bank, (ii) the Attorney shall no longer be
retained on behalf of the Bank or an affiliate of the Bank; or (iii) the
expiration of one year from the date of execution.
The authority granted to the attorney-in-fact by the Power of Attorney is not
transferable to any other party or entity.
The undersigned gives said Attorney-in-Fact full power and authority to execute
such instruments and to do and perform all and every act and thing necessary and
proper to carry into effect the power or powers granted by or under this Limited
Power of Attorney as fully as the undersigned might or could do, and hereby does
ratify and confirm to all that said Attorney-in-Fact shall lawfully do or cause
to be done by authority hereof.
Third parties without actual notice may rely upon the exercise of the power
granted under this Limited Power of attorney; and may be satisfied that this
Limited Power of Attorney shall continue in full force and effect and has not
been revoked unless an instrument of revocation has been made in writing by the
undersigned.
O-2
IN WITNESS WHEREOF, ______________________ as Trustee pursuant to that Pooling
and Servicing Agreement among the Depositor, the Servicer, and the Trustee,
dated as of January 1, 2006, Ownit Mortgage Loan Asset Backed Certificates,
Series 2006-1, has caused its corporate seal to be hereto affixed and these
presents to be signed and acknowledged in its name and behalf by
______________________ its duly elected and authorized Vice President this day
of , 200__.
as Trustee for Ownit Mortgage Loan Asset
Backed Certificates, Series 2006-1
By __________________________________
STATE OF
COUNTY OF
On _______________, 200__, before me, the undersigned, a Notary Public in and
for said state, personally appeared ___________________, Vice President of
___________________ as Trustee for ____________ Mortgage Loan Asset Backed
Certificates, Series 200__-___, personally known to me to be the person whose
name is subscribed to the within instrument and acknowledged to me that he/she
executed that same in his/her authorized capacity, and that by his/her signature
on the instrument the entity upon behalf of which the person acted and executed
the instrument.
WITESS my hand and official seal.
(SEAL)
------------------------------------
Notary Public
My Commission Expires ________________________
X-0
XXXXXXX X-0
FORM OF 1122(d) SERVICING CRITERIA LETTER
[DATE]
JPMorgan Chase Bank, National Association
0 Xxx Xxxx Xxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Worldwide Securities Services/
Structured Finance Services-OWNIT 0000-0
Xxx Xxxx xx Xxx Xxxx
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxxxxx
Re: Item 1122 of Regulation AB
OWNIT Mortgage Loan Trust, Series 2006-1
Ladies and Gentlemen:
In connection with the above-referenced transaction, Xxxxxx Loan
Servicing LP (the "Servicer"), JPMorgan Chase Bank, National Association (the
"Trustee") and The Bank of New York (the "Custodian") hereby acknowledge and
agree that the purpose of this letter agreement (this "Letter Agreement") is to
facilitate compliance by the Servicer, the Trustee and the Custodian with
identifying each party's responsibility with respect to the servicing criteria
identified in Item 1122(d) of Regulation AB. Xxxxxxx Xxxxx Mortgage Investors,
Inc. (the "Depositor") shall not exercise its right to request delivery of
information or other performance under these provisions other than in good
faith, or for purposes other than compliance with the Securities Act, the
Exchange Act and the rules and regulations of the Commission thereunder.
The Servicer, the Trustee and the Custodian each agree that as of the
Closing Date, each such party will, solely with respect to completing
assessments as required with respect to Item 1122(d) of Regulation AB and not as
an obligation with respect to the administration of the transaction, comply with
the servicing criteria indicated on Exhibit A hereto applicable to it in order
to comply with the requirements of Item 1122(d) of Regulation AB.
The Servicer, the Trustee and the Custodian each hereby acknowledge
that interpretations of the requirements of Item 1122(d) of Regulation AB may
change over time and agree in good faith to comply with requests made by the
Depositor in good faith for delivery of information under these provisions on
the basis of evolving interpretations of Regulation AB. In the event that the
parties are not able to agree upon the servicing criteria applicable to it, the
parties hereby agree to negotiate in good faith to come to a determination of
the servicing criteria applicable to them under Item 1122(d) of Regulation AB
using industry practice, industry groups' recommended practices and SEC
interpretative guidance as determining factors. If the parties cannot come to a
resolution after such negotiations, the parties hereby agree to submit to
binding arbitration by an arbitrator agreed to by the parties or if an
arbitrator can not be agreed upon then an arbitrator selected by the Depositor.
P-1-1
Capitalized terms used but not defined herein shall have the meanings
assigned to them in the Pooling and Servicing Agreement, dated as of January 1,
2006 among Credit-Based Asset Servicing and Securitization LLC, the Servicer,
the Trustee and the Depositor.
This Letter 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 the laws of the State of New
York except to the extent preempted by federal law.
For the purpose of facilitating the execution of this Letter Agreement,
and for other purposes, this Letter Agreement may be executed simultaneously in
any number of counterparts. Each counterpart shall be deemed to be an original,
and all such counterparts shall constitute one and the same instrument.
[NO FURTHER TEXT ON THIS PAGE]
P-1-2
XXXXXX LOAN SERVICING LP
By: __________________________
Name:
Title:
ACKNOWLEDGED AND AGREED:
JPMORGAN CHASE BANK, NATIONAL ASSOCIATION
By: __________________________
Name:
Title:
THE BANK OF NEW YORK
By: __________________________
Name:
Title:
XXXXXXX XXXXX MORTGAGE INVESTORS, INC.
By: __________________________
Name:
Title:
X-0-0
XXXXXXX X-0
SERVICING CRITERIA TO BE ADDRESSED
IN ASSESSMENT OF COMPLIANCE
(RMBS UNLESS OTHERWISE NOTED)
DEFINITIONS
PRIMARY SERVICER - transaction party having borrower contact
CUSTODIAN - safe keeper of pool assets
TRUSTEE - fiduciary of the transaction
------------------ --------------------------------------- ------------------- ------------------- -------------------
REG AB REFERENCE SERVICING CRITERIA XXXXXX LOAN BANK OF NEW YORK JPMORGAN CHASE
SERVICING LP (CUSTODIAN) BANK (TRUSTEE)
(SERVICER)
------------------ --------------------------------------- ------------------- ------------------- -------------------
GENERAL SERVICING CONSIDERATIONS
------------------ --------------------------------------- ------------------- ------------------- -------------------
Policies and procedures are X X
instituted to monitor any performance
or other triggers and events of
default in accordance with the
1122(d)(1)(i) transaction agreements.
------------------ --------------------------------------- ------------------- ------------------- -------------------
If any material servicing activities If applicable for If applicable for If applicable for
are outsourced to third parties, a transaction a transaction a transaction
policies and procedures are participant participant participant
instituted to monitor the third
party's performance and compliance
1122(d)(1)(ii) with such servicing activities.
------------------ --------------------------------------- ------------------- ------------------- -------------------
Any requirements in the transaction
agreements to maintain a back-up
servicer for the Pool Assets are
1122(d)(1)(iii) maintained.
------------------ --------------------------------------- ------------------- ------------------- -------------------
A fidelity bond and errors and X
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 otherwise in
accordance with the terms of the
1122(d)(1)(iv) transaction agreements.
------------------ --------------------------------------- ------------------- ------------------- -------------------
CASH COLLECTION AND ADMINISTRATION
------------------ --------------------------------------- ------------------- ------------------- -------------------
Payments on pool assets are deposited X X
into the appropriate custodial bank
accounts and related bank clearing
accounts no more than two business
days following receipt, or such other
number of days specified in the
1122(d)(2)(i) transaction agreements.
------------------ --------------------------------------- ------------------- ------------------- -------------------
Disbursements made via wire transfer X X
on behalf of an obligor or to an
investor are made only by authorized
1122(d)(2)(ii) personnel.
------------------ --------------------------------------- ------------------- ------------------- -------------------
Advances of funds or guarantees X
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
1122(d)(2)(iii) transaction agreements.
------------------ --------------------------------------- ------------------- ------------------- -------------------
The related accounts for the X* X
transaction, such as cash reserve
accounts or accounts established as a
form of over collateralization, are
separately maintained (e.g., with
respect to commingling of cash) as
set forth in the transaction
1122(d)(2)(iv) agreements.
------------------ --------------------------------------- ------------------- ------------------- -------------------
P-2-2
------------------ --------------------------------------- ------------------- ------------------- -------------------
REG AB REFERENCE SERVICING CRITERIA XXXXXX LOAN BANK OF NEW YORK JPMORGAN CHASE
SERVICING LP (CUSTODIAN) BANK (TRUSTEE)
(SERVICER)
------------------ --------------------------------------- ------------------- ------------------- -------------------
Each custodial account is maintained X X*
at a federally insured 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
1122(d)(2)(v) Exchange Act.
------------------ --------------------------------------- ------------------- ------------------- -------------------
Unissued checks are safeguarded so as If applicable If applicable
1122(d)(2)(vi) to prevent unauthorized access.
------------------ --------------------------------------- ------------------- ------------------- -------------------
Reconciliations are prepared on a X X
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 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
1122(d)(2)(vii) transaction agreements.
------------------ --------------------------------------- ------------------- ------------------- -------------------
INVESTOR REMITTANCES AND REPORTING
------------------ --------------------------------------- ------------------- ------------------- -------------------
Reports to investors, including those X X
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 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 Pool
1122(d)(3)(i) Assets serviced by the Servicer.
------------------ --------------------------------------- ------------------- ------------------- -------------------
Amounts due to investors are X X
allocated and remitted in accordance
with timeframes, distribution
priority and other terms set forth in
1122(d)(3)(ii) the transaction agreements.
------------------ --------------------------------------- ------------------- ------------------- -------------------
Disbursements made to an investor are X X
posted within two business days to
the Servicer's investor records, or
such other number of days specified
1122(d)(3)(iii) in the transaction agreements.
------------------ --------------------------------------- ------------------- ------------------- -------------------
Amounts remitted to investors per the X X
investor reports agree with cancelled
checks, or other form of payment, or
1122(d)(3)(iv) custodial bank statements.
------------------ --------------------------------------- ------------------- ------------------- -------------------
P-2-3
------------------ --------------------------------------- ------------------- ------------------- -------------------
REG AB REFERENCE SERVICING CRITERIA XXXXXX LOAN BANK OF NEW YORK JPMORGAN CHASE
SERVICING LP (CUSTODIAN) BANK (TRUSTEE)
(SERVICER)
------------------ --------------------------------------- ------------------- ------------------- -------------------
POOL ASSET ADMINISTRATION
------------------ --------------------------------------- ------------------- ------------------- -------------------
Collateral or security on pool assets X
is maintained as required by the
transaction agreements or related
1122(d)(4)(i) pool asset documents.
------------------ --------------------------------------- ------------------- ------------------- -------------------
Pool assets and related documents X
are safeguarded as required by the
1122(d)(4)(ii) transaction agreements
------------------ --------------------------------------- ------------------- ------------------- -------------------
Any additions, removals or X X
substitutions to the asset pool are
made, reviewed and approved in
accordance with any conditions or
requirements in the transaction
1122(d)(4)(iii) agreements.
------------------ --------------------------------------- ------------------- ------------------- -------------------
Payments on pool assets, including X
any payoffs, made in accordance with
the related pool asset documents are
posted to the Servicer's obligor
records maintained no more than two
business days after receipt, or such
other number of days specified in the
transaction agreements, and allocated
to principal, interest or other items
(e.g., escrow) in accordance with the
1122(d)(4)(iv) related pool asset documents.
------------------ --------------------------------------- ------------------- ------------------- -------------------
The Servicer's records regarding the X
pool assets agree with the Servicer's
records with respect to an obligor's
1122(d)(4)(v) unpaid principal balance.
------------------ --------------------------------------- ------------------- ------------------- -------------------
Changes with respect to the terms or X
status of an obligor's pool assets
(e.g., loan modifications or
re-agings) are made, reviewed and
approved by authorized personnel in
accordance with the transaction
agreements and related pool asset
1122(d)(4)(vi) documents.
------------------ --------------------------------------- ------------------- ------------------- -------------------
Loss mitigation or recovery actions X
(e.g., forbearance plans,
modifications and deeds in lieu of
foreclosure, foreclosures and
repossessions, as applicable) are
initiated, conducted and concluded in
accordance with the timeframes or
other requirements established by the
1122(d)(4)(vii) transaction agreements.
------------------ --------------------------------------- ------------------- ------------------- -------------------
Records documenting collection X
efforts are maintained during the
period a pool asset 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 delinquent pool assets
including, for example, phone calls,
letters and payment rescheduling
plans in cases where delinquency is
deemed temporary (e.g., illness or
1122(d)(4)(viii) unemployment).
------------------ --------------------------------------- ------------------- ------------------- -------------------
Adjustments to interest rates or X
rates of return for pool assets with
variable rates are computed based on
1122(d)(4)(ix) the related pool asset documents.
------------------ --------------------------------------- ------------------- ------------------- -------------------
P-2-4
------------------ --------------------------------------- ------------------- ------------------- -------------------
REG AB REFERENCE SERVICING CRITERIA XXXXXX LOAN BANK OF NEW YORK JPMORGAN CHASE
SERVICING LP (CUSTODIAN) BANK (TRUSTEE)
(SERVICER)
------------------ --------------------------------------- ------------------- ------------------- -------------------
Regarding any funds held in trust for X
an obligor (such as escrow accounts):
(A) such funds are analyzed, in
accordance with the obligor's pool
asset 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 accordance with
applicable pool asset documents and
state laws; and (C) such funds are
returned to the obligor within 30
calendar days of full repayment of
the related pool assets, or such
other number of days specified in the
1122(d)(4)(x) transaction agreements.
------------------ --------------------------------------- ------------------- ------------------- -------------------
Payments made on behalf of an obligor X
(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 servicer at least 30 calendar
days prior to these dates, or such
other number of days specified in the
1122(d)(4)(xi) transaction agreements.
------------------ --------------------------------------- ------------------- ------------------- -------------------
Any late payment penalties in X
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
1122(d)(4)(xii) due to the obligor's error or omission.
------------------ --------------------------------------- ------------------- ------------------- -------------------
Disbursements made on behalf of an X
obligor are posted within two business
days to the obligor's records
maintained by the servicer, or such
other number of days specified in
1122(d)(4)(xiii) the transaction agreements.
------------------ --------------------------------------- ------------------- ------------------- -------------------
Delinquencies, charge-offs and X
uncollectible accounts are recognized
and recorded in accordance with the
1122(d)(4)(xiv) transaction agreements.
------------------ --------------------------------------- ------------------- ------------------- -------------------
Any external enhancement or other X
support, identified in Item 1114(a)(1)
through (3) or Item 1115 of Regulation
AB, is maintained as set forth in the
1122(d)(4)(xv) transaction agreements.
------------------ --------------------------------------- ------------------- ------------------- -------------------
*For d(2)(iv) Servicer needs to provide only if it is deemed that the Collection
Account is subject to this critieria.
*For d(2)(v) Trustee needs to provide only if it is deemed that any account
maintained by the Trustee is a custodial account for purposes of the servicing
criteria. Subject to further clarification from the SEC.
X-0-0
XXXXXXX X-0
XXXX XX XXXXXXXX-XXXXX CERTIFICATION (SERVICER)
2006-1 TRUST,
OWNIT MORTGAGE LOAN ASSET-BACKED CERTIFICATES, SERIES 2006-1
Re: Ownit Mortgage Loan Trust, Mortgage Loan Asset-Backed Certificates,
Series 2006-1
I, [identify the certifying individual], certify that:
1. I have reviewed the report on Form 10-K and all reports on Form 10-D
required to be filed in respect of the period covered by this report on Form
10-K of [identify the issuing entity] (the "Exchange Act Periodic Reports");
2. Based on my knowledge, the Exchange Act Periodic Reports, taken as a
whole, do not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading with respect
to the period covered by this report;
3. Based on my knowledge, all of the distribution, servicing and other
information required to be provided under Form 10-D for the period covered by
this report is included in the Exchange Act Periodic Reports;
4. [I am responsible for reviewing the activities performed by the
servicer(s) and based on my knowledge and the compliance review(s) conducted in
preparing the servicer compliance statement(s) required in this report under
Item 1123 of Regulation AB, and except as disclosed in the Exchange Act Periodic
Reports, the servicer(s) [has/have] fulfilled [its/their] obligations under the
servicing agreement(s); and]
5. All of the reports on assessment of compliance with servicing
criteria for ABS and their related attestation reports on assessment of
compliance with servicing criteria for asset-backed securities required to be
included in this report in accordance with Item 1122 of Regulation AB and
Exchange Act Rules 13a-18 and 15d-18 have been included as an exhibit to this
report, except as otherwise disclosed in this report. Any material instances of
noncompliance described in such reports have been disclosed in this report on
Form 10-K.
[In giving the certifications above, I have reasonably relied on
information provided to me by the following unaffiliated parties [name of
servicer, sub-servicer, co-servicer, depositor, custodian or trustee].]
Date:_________________________
--------------------------------
[Signature]
[Title]
X-0-0
XXXXXXX X-0
FORM OF ITEM 1123 CERTIFICATION OF SERVICER
[DATE]
Xxxxxxx Xxxxx Mortgage Investors, Inc.
000 Xxxxx Xxxxxx
4 World Financial Center, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
JPMorgan Chase Bank, National Association
0 Xxx Xxxx Xxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Worldwide Securities Services/Structured Finance Services,
Ownit 2006-1 [and/or its designee]
Re: Pooling and Servicing Agreement (the "Agreement") dated as of January
1, 2006, among Xxxxxxx Xxxxx Mortgage Investors, Inc., as depositor,
Xxxxxx Loan Servicing LP, as servicer, Credit-Based Asset Servicing
and Securitization LLC, as sponsor, and JPMorgan Chase Bank, National
Association, as trustee, relating to Ownit Mortgage Loan Trust,
Mortgage Loan Asset-Backed Certificates, Series 2006-1.
I, [identify name of certifying individual], [title of certifying individual] of
Xxxxxx Loan Servicing LP (the "Servicer"), hereby certify that:
(1) A review of the activities of the Servicer during the preceding
calendar year and of the performance of the Servicer under the Agreement has
been made under my supervision; and
(2) To the best of my knowledge, based on such review, the Servicer has
fulfilled all its obligations under the Agreement in all material respects
throughout such year or a portion thereof[, or, if there has been a failure to
fulfill any such obligation in any material respect, I have specified below each
such failure known to me and the nature and status thereof].
Date:
Xxxxxx Loan Servicing LP,
as Servicer
By: ____________________________________
Name: __________________________________
Title: _________________________________
X-0-0
XXXXXXX X-0
FORM OF OFFICER'S CERTIFICATE OF TRUSTEE
2005-CB6 TRUST,
C-BASS MORTGAGE LOAN ASSET-BACKED CERTIFICATES, SERIES 2005-CB6
Reference is made to the Pooling and Servicing Agreement, dated as of
January 1, 2006 (the "Pooling Agreement"), by and among JPMorgan Chase Bank,
National Association (the "Trustee"), Credit-Based Asset Servicing and
Securitization LLC, as sponsor, Xxxxxx Loan Servicing LP, as servicer (the
"Servicer") and Xxxxxxx Xxxxx Mortgage Investors, Inc., as depositor (the
"Depositor"). The Trustee hereby certifies to the Servicer and its officers,
directors and affiliates, and with the knowledge and intent that they will rely
upon this certification, that:
(i) The Trustee has reviewed the annual report on Form 10-K for
the fiscal year [ ], and all reports on Form 8-K containing
distribution reports filed in respect of periods included in
the year covered by that annual report, relating to the
above-referenced trust;
(ii) Subject to paragraph (iv), the distribution information in the
distribution reports contained in all Monthly Form 8-K's
included in the year covered by the annual report on Form 10-K
for the calendar year [___], taken as a whole, does not
contain any untrue statement of a material fact or omit to
state a material fact required by the Pooling Agreement to be
included therein and necessary to make the statements made, in
light of the circumstances under which such statements were
made, not misleading as of the last day of the period covered
by that annual report;
(iii) The distribution information required to be provided by the
Trustee under the Pooling Agreement is included in these
reports.
(iv) In compiling the distribution information and making the
foregoing certifications, the Trustee has relied upon
information furnished to it by the Servicer under the
Agreement. The Trustee shall have no responsibility or
liability for any inaccuracy in such reports resulting from
information so provided by the Servicer.
Date:
JPMorgan Chase Bank, National Association,
as Trustee
By: ______________________________________
Name: ____________________________________
Title: ___________________________________
P-5-1
EXHIBIT Q
FORM OF OFFICER'S CERTIFICATE WITH RESPECT TO PREPAYMENTS
Officer's Certificate
Ownit Mortgage Loan Asset-Backed Certificates, Series 2006-1
[DATE]
VIA FACSIMILE
JPMorgan Chase Bank, National Association
0 Xxx Xxxx Xxxxx
0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Worldwide Securities Services/Structured Finance Services
Ownit 2006-1
Re: Prepayments
Dear Sir or Madam:
__________________ hereby certifies that he/she is an officer
of the Servicer, holding the office set forth beneath his/her name and hereby
further certifies as follows:
With respect to the Mortgage Loans set forth in the attached
schedule:
1. A Principal Prepayment in full was received during the
related Collection Period;
2. Any prepayment penalty due under the terms of the
Mortgage Note with respect to such Principal Prepayment
in full was received from the mortgagor and deposited in
the Collection Account: ____ Yes ____ No
3. As to each Mortgage Loan so noted on the attached
schedule, all or part of the prepayment penalty required
in connection with the Principal Prepayment in full was
waived based upon (Circle one):
(i) the Servicer's determination that such waiver would
maximize recovery of Liquidation Proceeds for such
Mortgage Loan, taking into account the value of such
prepayment penalty, or
(ii)(A) the enforceability thereof be limited (1) by
bankruptcy insolvency, moratorium, receivership, or
other similar law relating to creditors' rights
generally or (2) due to acceleration in connection with
a foreclosure or other involuntary payment, or (B) the
enforceability is otherwise limited or prohibited by
applicable law;
4. We certify that all amounts due in connection with the
waiver of a prepayment penalty inconsistent with number
3 above which are required to be deposited by the
Servicer pursuant to Section 3.01 of the Pooling and
Servicing Agreement, have been or will be so deposited.
Q-1
Capitalized terms used herein shall have the meanings ascribed
to such terms in the Pooling and Servicing Agreement, dated January 1, 2006,
among Xxxxxxx Xxxxx Mortgage Investors, Inc., as depositor, Credit-Based Asset
Servicing and Securitization LLC, as sponsor, Xxxxxx Loan Servicing LP, as
servicer and JPMorgan Chase Bank, National Association, as trustee.
XXXXXX LOAN SERVICING LP
By:
------------------------------------
Name:
Title:
Q-2
EXHIBIT R
FORM 8-K DISCLOSURE
------------------------------------------------------------ --------------------------------------------------------
Item on Form 8-K Party Responsible
------------------------------------------------------------ --------------------------------------------------------
Item 1.01- Entry into a Material Definitive Depositor
Agreement
------------------------------------------------------------ --------------------------------------------------------
Item 1.02- Termination of a Material Definitive Depositor
Agreement
------------------------------------------------------------ --------------------------------------------------------
Item 1.03- Bankruptcy or Receivership Depositor
------------------------------------------------------------ --------------------------------------------------------
Item 2.04- Triggering Events that Accelerate or Depositor
Increase a Direct Financial Obligation or an
Obligation under an Off-Balance Sheet
Arrangement
------------------------------------------------------------ --------------------------------------------------------
Item 3.03- Material Modification to Rights of Depositor
Security Holders
------------------------------------------------------------ --------------------------------------------------------
Item 5.03- Amendments of Articles of Depositor
Incorporation or Bylaws; Change of Fiscal Year
------------------------------------------------------------ --------------------------------------------------------
Item 6.01- ABS Informational and Computational Depositor
Material
------------------------------------------------------------ --------------------------------------------------------
Item 6.02- Change of Servicer or Trustee Servicer, Depositor
------------------------------------------------------------ --------------------------------------------------------
Item 6.03- Change in Credit Enhancement or Depositor
External Support
------------------------------------------------------------ --------------------------------------------------------
Item 6.04- Failure to Make a Required Depositor
Distribution
------------------------------------------------------------ --------------------------------------------------------
Item 6.05- Securities Act Updating Disclosure Depositor
------------------------------------------------------------ --------------------------------------------------------
Item 7.01- Reg FD Disclosure Depositor
------------------------------------------------------------ --------------------------------------------------------
Item 8.01 Depositor
------------------------------------------------------------ --------------------------------------------------------
Item 9.01 Depositor
------------------------------------------------------------ --------------------------------------------------------
To the extent no notice is provided to the Trustee of the events or information
as described above in this Exhibit R, the Trustee shall without further notice
conclude that there is no event or information to be reported.
R-1
EXHIBIT S
FORM 10-D DISCLOSURE
ITEM DESCRIPTION RESPONSIBLE PARTY
---------- ------------------------------------------------------------------------------------- -----------------------------
1 DISTRIBUTION AND POOL PERFORMANCE INFORMATION
---------- ------------------------------------------------------------------------------------- -----------------------------
Item 1121(a) Distribution and Pool Performance Information
---------- ------------------------------------------------------------------------------------- -----------------------------
(1) Any applicable record dates, accrual dates, determination dates for calculating 4.06 statement*
distributions and actual distribution dates for the distribution period.
---------- ------------------------------------------------------------------------------------- -----------------------------
(2) Cash flows received and the sources thereof for distributions, fees and 4.06 statement
expenses.
---------- ------------------------------------------------------------------------------------- -----------------------------
(3) Calculated amounts and distribution of the flow of funds for the period itemized 4.06 statement
by type and priority of payment, including:
---------- ------------------------------------------------------------------------------------- -----------------------------
(i) Fees or expenses accrued and paid, with an identification of the general 4.06 statement
purpose of such fees and the party receiving such fees or expenses.
---------- ------------------------------------------------------------------------------------- -----------------------------
(ii) Payments accrued or paid with respect to enhancement or other support 4.06 statement
identified in Item 1114 of Regulation AB (such as insurance premiums or other
enhancement maintenance fees), with an identification of the general purpose of
such payments and the party receiving such payments.
---------- ------------------------------------------------------------------------------------- -----------------------------
(iii) Principal, interest and other distributions accrued and paid on the 4.06 statement
asset-backed securities by type and by class or series and any principal or
interest shortfalls or carryovers.
---------- ------------------------------------------------------------------------------------- -----------------------------
(iv) The amount of excess cashflow or excess spread and the disposition of 4.06 statement
excess cashflow.
---------- ------------------------------------------------------------------------------------- -----------------------------
(4) Beginning and ending principal balances of the asset-backed securities. 4.06 statement
---------- ------------------------------------------------------------------------------------- -----------------------------
(5)Interest rates applicable to the pool assets and the asset-backed securities, as 4.06 statement
applicable. Interest rate information for pool assets in appropriate distributional
groups and incremental ranges.
---------- ------------------------------------------------------------------------------------- -----------------------------
(6) Beginning and ending balances of transaction accounts, such as reserve accounts, 4.06 statement
and material account activity during the period.
---------- ------------------------------------------------------------------------------------- -----------------------------
(7) Any amounts drawn on any credit enhancement or other support identified in Item 4.06 statement
1114 of Regulation AB, as applicable, and the amount of coverage remaining under any
such enhancement, if known and applicable.
---------- ------------------------------------------------------------------------------------- -----------------------------
(8) Number and amount of pool assets at the beginning and ending of each period, and 4.06 statement
updated pool composition information, including weighted average coupon, weighted
average life, weighted average remaining term, pool factors and prepayment amounts. Pool composition
information fields may be
updated as specified by
Depositor from time to time.
---------- ------------------------------------------------------------------------------------- -----------------------------
(9) Delinquency and loss information for the period. 4.06 statement
In addition, describe any material changes to the information specified in Form 10-D report: Servicer
Item 1100(b)(5) of Regulation AB regarding the pool assets.
---------- ------------------------------------------------------------------------------------- -----------------------------
(10) Information on the amount, terms and general purpose of any advances 4.06 statement
made or reimbursed during the period, including the general use of
funds advanced and the general source of funds for reimbursements.
---------- ------------------------------------------------------------------------------------- -----------------------------
(11) Any material modifications, extensions or waivers to pool asset terms, 4.06 statement
fees, penalties or payments during the distribution period or that have
cumulatively become material over time.
---------- ------------------------------------------------------------------------------------- -----------------------------
S-1
---------- ------------------------------------------------------------------------------------- -----------------------------
(12) Material breaches of pool asset representations or warranties or transaction Form 10-D report:
covenants Servicer
---------- ------------------------------------------------------------------------------------- -----------------------------
(13) Information on ratio, coverage or other tests used for determining any early 4.06 statement
amortization, liquidation or other performance trigger and whether the trigger was
met.
---------- ------------------------------------------------------------------------------------- -----------------------------
(14) Information regarding any new issuance of asset-backed securities backed by Form 10-D report: Depositor
the same asset pool, information regarding any pool asset changes (other than in
connection with a pool asset converting into cash in accordance with its terms),
such as additions or removals in connection with a prefunding or revolving period
and pool asset substitutions and repurchases (and purchase rates, if applicable),
and cash flows available for future purchases, such as the balances of any
prefunding or revolving accounts, if applicable. Disclose any material changes in
the solicitation, credit-granting, underwriting, origination, acquisition or pool
selection criteria or procedures, as applicable, used to originate, acquire or
select the new pool assets.
---------- ------------------------------------------------------------------------------------- -----------------------------
Item 1121(b) Pre-Funding or Revolving Period Information
Updated pool information as required under Item 1121(b). N/A
---------- ------------------------------------------------------------------------------------- -----------------------------
2 LEGAL PROCEEDINGS
---------- ------------------------------------------------------------------------------------- -----------------------------
Item 1117 Legal proceedings pending against the following entities, or their
respective property, that is material to Certificateholders, including proceedings
known to be contemplated by governmental authorities:
Sponsor Sponsor
Depositor Depositor
Trustee Trustee
Issuing Entity All Parties
Originator Originator
Custodian Custodian
---------- ------------------------------------------------------------------------------------- -----------------------------
3 SALES OF SECURITIES AND USE OF PROCEEDS
---------- ------------------------------------------------------------------------------------- -----------------------------
Information from Item 2(a) of Part II of Form 10-Q:
With respect to any sale of securities by the Sponsor, Depositor or Issuing Entity Depositor
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 may be omitted if securities were
not registered.
---------- ------------------------------------------------------------------------------------- -----------------------------
4 DEFAULT UPON SENIOR SECURITIES
---------- ------------------------------------------------------------------------------------- -----------------------------
Information from Item 3 of Part II Of Form 10-Q:
Report the occurrence of any Event of Default (after expiration of any grace period Trustee
and provision of any required notice).
---------- ------------------------------------------------------------------------------------- -----------------------------
5 SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
---------- ------------------------------------------------------------------------------------- -----------------------------
Information from Item 4 of Part II of Form 10-Q Trustee
---------- ------------------------------------------------------------------------------------- -----------------------------
6 SIGNIFICANT OBLIGORS OF POOL ASSETS
---------- ------------------------------------------------------------------------------------- -----------------------------
S-2
---------- ------------------------------------------------------------------------------------- -----------------------------
Item 1112(b) Significant Obligor Financial Information* N/A
---------- ------------------------------------------------------------------------------------- -----------------------------
*This information need only be reported on the Form 10-D for the distribution period
in which updated information is required pursuant to the Item.
---------- ------------------------------------------------------------------------------------- -----------------------------
7 SIGNIFICANT ENHANCEMENT PROVIDER INFORMATION
---------- ------------------------------------------------------------------------------------- -----------------------------
Item 1114(b)(2) Credit Enhancement Provider Financial Information*
Determining applicable disclosure threshold. Depositor
Obtaining required financial information or effecting incorporation by reference. Depositor
---------- ------------------------------------------------------------------------------------- -----------------------------
Item 1115(b) Derivative Counterparty Financial Information*
Determining current maximum probable exposure. Depositor
Determining current significance percentage. Depositor
Obtaining required financial information or effecting incorporation by reference. Depositor
---------- ------------------------------------------------------------------------------------- -----------------------------
*This information need only be reported on the Form 10-D for the distribution
period in which updated information is required pursuant to the Items.
---------- ------------------------------------------------------------------------------------- -----------------------------
8 OTHER INFORMATION
---------- ------------------------------------------------------------------------------------- -----------------------------
Disclose any information required to be reported on Form 8-K during the period The Responsible Party for
covered by the Form 10-D but not reported. the applicable Form 8-K
item.
---------- ------------------------------------------------------------------------------------- -----------------------------
9 EXHIBITS
---------- ------------------------------------------------------------------------------------- -----------------------------
Distribution Report Trustee
---------- ------------------------------------------------------------------------------------- -----------------------------
Exhibits required by Item 601 of Regulation S-K, such as material agreements. Depositor
---------- ------------------------------------------------------------------------------------- -----------------------------
* "4.06 statement" refers to the Statements to be prepared by the Trustee as
described in Section 4.06 of the Pooling Agreement.
To the extent no notice is provided to the Trustee of the events or information
as described above in this Exhibit S, the Trustee shall without further notice
conclude that there is no event or information to be reported.
S-3
EXHIBIT T
FORM 10-K DISCLOSURE
---------------------------------------------------------- --------------------------------------------------------
Item on Form 10-K Party Responsible
---------------------------------------------------------- --------------------------------------------------------
Item 1B: Unresolved Staff Comments Depositor
---------------------------------------------------------- --------------------------------------------------------
Item 9B: Other Information Any party responsible for disclosure items on Form 8-K
---------------------------------------------------------- --------------------------------------------------------
Item 15: Exhibits, Financial Statement Schedules Depositor
---------------------------------------------------------- --------------------------------------------------------
Additional Item: All parties to the Pooling and Servicing Agreement (as
to themselves), any party with notice thereof as to the
Disclosure per Item 1117 of Reg AB issuing entity, any 1100(d)(1) party
---------------------------------------------------------- --------------------------------------------------------
Additional Item: All parties to the Pooling and Servicing Agreement,
Disclosure per Item 1119 of Reg AB the sponsor, significant obligor, enhancement or
support provider
---------------------------------------------------------- --------------------------------------------------------
Additional Item: N/A
Disclosure per Item 1112(b) of Reg AB
---------------------------------------------------------- --------------------------------------------------------
Additional Item: Depositor
Disclosure per Items 1114(b) and 1115(b) of Reg AB
---------------------------------------------------------- --------------------------------------------------------
Additional Item: Trustee, Servicer and Custodian
Disclosure per Item 1122 of Reg AB
---------------------------------------------------------- --------------------------------------------------------
Additional Item: Servicer
Disclosure per Item 1123 of Reg AB
---------------------------------------------------------- --------------------------------------------------------
To the extent no notice is provided to the Trustee of the events or information
as described above in this Exhibit T, the Trustee shall without further notice
conclude that there is no event or information to be reported.
T-1
