EXECUTION COPY
CHASE MORTGAGE FINANCE CORPORATION,
DEPOSITOR,
CHASE MANHATTAN MORTGAGE CORPORATION,
SERVICER
and
CITIBANK, N.A.,
TRUSTEE
POOLING AND SERVICING AGREEMENT
Dated as of January 1, 2001
$225,024,611.66
Multi-Class Mortgage Pass-Through Certificates
Series 2001-S1
TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS.....................................................................................1
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; TRUST FUND.......................................................25
Section 2.01 Conveyance of Mortgage Loans......................................................25
Section 2.02 Acceptance by Trustee.............................................................29
Section 2.03 Trust Fund; Authentication of Certificates........................................30
Section 2.04 REMIC Election....................................................................30
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE DEPOSITOR AND
THE SERVICER; REPURCHASE OF MORTGAGE LOANS.....................................................31
Section 3.01 Representations and Warranties of the Depositor with respect to the
Mortgage Loans....................................................................31
Section 3.02 Representations and Warranties of the Servicer....................................38
Section 3.03 Option to Substitute..............................................................39
ARTICLE IV
THE CERTIFICATES...............................................................................40
Section 4.01 The Certificates..................................................................40
Section 4.02 Registration of Transfer and Exchange of Certificates.............................42
Section 4.03 Mutilated, Destroyed, Lost or Stolen Certificates.................................45
Section 4.04 Persons Deemed Owners.............................................................46
Section 4.05 Appointment of Paying Agent; Certificate Account..................................46
Section 4.06 Authenticating Agents.............................................................47
ARTICLE V
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS.................................................47
Section 5.01 Servicer to Service Mortgage Loans................................................47
Section 5.02 Sub-Servicing Agreements Between Servicer and Sub-Servicers;
Enforcement of Sub-Servicer's Obligations.........................................48
Section 5.03 Successor Sub-Servicers...........................................................49
Section 5.04 Liability of the Servicer.........................................................49
Section 5.05 No Contractual Relationship Between Sub-Servicer and Trustee or
Certificateholders................................................................49
Section 5.06 Termination of Sub-Servicing Agreement............................................49
Section 5.07 Collection of Mortgage Loan Payments..............................................49
Section 5.08 Establishment of Collection Account; Deposit in Collection Account................50
Section 5.09 Permitted Withdrawals from the Collection Account.................................51
Section 5.10 Establishment of Escrow Account; Deposits in Escrow Account.......................52
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Section 5.11 Permitted Withdrawals from Escrow Account.........................................52
Section 5.12 Payment of Taxes, Insurance and Other Charges.....................................52
Section 5.13 Transfer of Accounts..............................................................53
Section 5.14 [Reserved]........................................................................53
Section 5.15 Maintenance of the Primary Insurance Policies.....................................53
Section 5.16 Maintenance of Standard Hazard Policies...........................................53
Section 5.17 [Reserved]........................................................................54
Section 5.18 [Reserved]........................................................................54
Section 5.19 Fidelity Bond and Errors and Omissions Insurance..................................54
Section 5.20 Collections under Insurance Policies; Enforcement of Due-On-Sale Clauses;
Assumption Agreements.............................................................54
Section 5.21 Income and Realization from Defaulted Mortgage Loans..............................55
Section 5.22 Trustee to Cooperate; Release of Mortgage Files...................................56
Section 5.23 Servicing and Other Compensation..................................................57
Section 5.24 1934 Act Reports..................................................................57
Section 5.25 Annual Statement as to Compliance.................................................58
Section 5.26 Annual Independent Public Accountants' Servicing Report...........................58
Section 5.27 Access to Certain Documentation; Rights of the Depositor in
Respect of the Servicer...........................................................58
Section 5.28 REMIC-Related Covenants...........................................................59
ARTICLE VI
PAYMENTS TO THE CERTIFICATEHOLDERS.............................................................60
Section 6.01 Distributions.....................................................................60
Section 6.02 Statements to the Certificateholders..............................................63
Section 6.03 Advances by the Servicer..........................................................65
Section 6.04 Allocation of Realized Losses.....................................................65
Section 6.05 Compensating Interest; Allocation of Certain Interest Shortfalls..................66
Section 6.06 Subordination.....................................................................67
ARTICLE VII
REPORTS TO BE PREPARED BY THE SERVICER.........................................................68
Section 7.01 Servicer Shall Provide Information as Reasonably Required.........................68
Section 7.02 Federal Information Returns and Reports to Certificateholders.....................68
ARTICLE VIII
THE DEPOSITOR AND THE SERVICER.................................................................69
Section 8.01 Indemnification; Third Party Claims...............................................69
Section 8.02 Merger or Consolidation of the Depositor or the Servicer..........................69
Section 8.03 Limitation on Liability of the Depositor, the Servicer, the Trustee and Others....70
Section 8.04 Depositor and Servicer Not to Resign..............................................70
Section 8.05 Successor to the Servicer.........................................................71
Section 8.06 Maintenance of Ratings............................................................72
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ARTICLE IX
DEFAULT........................................................................................72
Section 9.01 Events of Default.................................................................72
Section 9.02 Waiver of Defaults................................................................73
Section 9.03 Trustee to Act; Appointment of Successor..........................................73
Section 9.04 Notification to Certificateholders and the Rating Agencies........................73
ARTICLE X
CONCERNING THE TRUSTEE.........................................................................74
Section 10.01 Duties of Trustee................................................................74
Section 10.02 Certain Matters Affecting the Trustee............................................74
Section 10.03 Trustee Not Liable for Certificates or Mortgage Loans............................75
Section 10.04 Trustee May Own Certificates.....................................................76
Section 10.05 Fees and Expenses................................................................76
Section 10.06 Eligibility Requirements for Trustee.............................................76
Section 10.07 Resignation and Removal of the Trustee...........................................76
Section 10.08 Successor Trustee................................................................77
Section 10.09 Merger or Consolidation of Trustee...............................................78
Section 10.10 Appointment of Co-Trustee or Separate Trustee....................................78
Section 10.11 Appointment of Office or Agency..................................................78
ARTICLE XI
TERMINATION....................................................................................79
Section 11.01 Termination......................................................................79
ARTICLE XII
MISCELLANEOUS PROVISIONS.......................................................................80
Section 12.01 Severability of Provisions.......................................................80
Section 12.02 Limitation on Rights of Certificateholders.......................................80
Section 12.03 Amendment........................................................................81
Section 12.04 Counterparts.....................................................................82
Section 12.05 Duration of Agreement............................................................82
Section 12.06 Governing Law....................................................................82
Section 12.07 Notices..........................................................................82
Section 12.08 Further Assurances...............................................................82
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EXHIBIT A MORTGAGE LOAN SCHEDULE
EXHIBIT B CONTENTS OF MORTGAGE FILE
EXHIBIT C FORM OF CLASS A CERTIFICATES
EXHIBIT D FORM OF CLASS M CERTIFICATE
EXHIBIT E FORM OF CLASS B CERTIFICATES
EXHIBIT F FORM OF CLASS A-R CERTIFICATE
EXHIBIT G FORM OF TRUSTEE CERTIFICATION
EXHIBIT H FORM OF INVESTMENT LETTER
EXHIBIT I FORM OF RULE 144A INVESTMENT LETTER
EXHIBIT J FORM OF SPECIAL SERVICING AND COLLATERAL FUND AGREEMENT
EXHIBIT K FORM OF CLASS A-R TRANSFEREE LETTER
EXHIBIT L REQUEST FOR RELEASE OF DOCUMENTS
EXHIBIT M TRANSFEREE ERISA REPRESENTATION LETTER
This Pooling and Servicing Agreement, dated as of January 1,
2001 is executed among Chase Mortgage Finance Corporation, as depositor
(together with its permitted successors and assigns, the "Depositor"), Chase
Manhattan Mortgage Corporation, as servicer (together with its permitted
successors and assigns, the "Servicer") and Citibank, N.A., as trustee (together
with its permitted successors and assigns, the "Trustee").
In consideration of the premises and the mutual agreements
hereinafter set forth, the Depositor, the Servicer and the Trustee agree as
follows:
ARTICLE I
DEFINITIONS
Whenever used herein, the following words and phrases, unless
the context otherwise requires, shall have the following meanings:
ACCEPTED SERVICING PRACTICES: With respect to any Mortgage
Loan, those mortgage servicing practices (including collection procedures) of
prudent mortgage banking institutions which service mortgage loans of the same
type as such Mortgage Loan in the jurisdiction where the related Mortgaged
Property (or Underlying Mortgaged Property, in the case of a Co-op Loan), is
located, and which are in accordance with FNMA servicing practices and
procedures for MBS pool mortgages (as defined in the FNMA Guides, including
future updates).
ADVANCE: The aggregate of the advances made by the Servicer
with respect to a particular Distribution Date pursuant to Section 6.03.
AGGREGATE CLASS A INTEREST ACCRUAL AMOUNT: On any Distribution
Date, an amount equal to the sum of the Class A-1 Interest Accrual Amount, the
Class A-2 Interest Accrual Amount, the Class A-3 Interest Accrual Amount, the
Class A-4 Interest Accrual Amount, the Class A-R Interest Accrual Amount and the
Class A-X Interest Accrual Amount.
AGGREGATE CLASS A INTEREST SHORTFALL: On any Distribution
Date, an amount equal to the sum of the Class A-1 Shortfall, the Class A-2
Shortfall, the Class A-3 Shortfall, the Class A-4 Shortfall, the Class A-R
Shortfall and the Class A-X Shortfall.
AGREEMENT: This Pooling and Servicing Agreement and all
amendments hereof and supplements hereto.
APPRAISED VALUE: The value set forth in an appraisal made in
connection with the origination of the related Mortgage Loan as the value of the
Mortgaged Property (or the related residential dwelling unit in the Underlying
Mortgaged Property, in the case of a Co-op Loan).
ASSIGNMENT OF MORTGAGE: An assignment of the Mortgage, notice
of transfer (or UCC-3 assignment (or equivalent instrument) with respect to each
Co-op Loan) or equivalent instrument, in recordable form (except in the case of
a Co-op Loan), sufficient under the laws of the jurisdiction where the related
Mortgaged Property (or Underlying Mortgaged Property, in the case of a Co-op
Loan), is located to reflect of record the sale and assignment of the Mortgage
Loan to the Trustee,
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which assignment, notice of transfer or equivalent instrument may, if permitted
by law, be in the form of one or more blanket assignments covering Mortgages
secured by Mortgaged Properties located in the same county.
AUTHENTICATING AGENT: The meaning specified in Section 4.06.
AVAILABLE DISTRIBUTION AMOUNT: On any Distribution Date, an
amount equal to the amount on deposit in the Collection Account as of the close
of business on the Business Day immediately preceding the related Distribution
Date except:
(a) amounts received on particular Mortgage Loans as late
payments or other recoveries of principal or interest (including
Liquidation Proceeds, Insurance Proceeds and condemnation awards) and
respecting which the Servicer previously made an unreimbursed Advance
of such amounts;
(b) reimbursement for Nonrecoverable Advances and other
amounts permitted to be withdrawn by the Servicer pursuant to Section
5.09 from, or not required to be deposited in, the Collection Account;
(c) amounts representing the Servicing Fee with respect to
such Distribution Date;
(d) amounts representing all or part of a Monthly Payment due
(i) after the related Due Period or (ii) on or prior to the Cut-off
Date;
(e) all Repurchase Proceeds, Principal Prepayments,
Liquidation Proceeds, Insurance Proceeds and condemnation awards with
respect to Mortgage Loans received after the related Principal
Prepayment Period, and all related payments of interest representing
interest for any period of time after the last day of the related Due
Period for such Mortgage Loans; and
(f) all income from Eligible Investments held in the
Collection Account for the account of the Servicer.
BANKRUPTCY AMOUNT: As of any date of determination, $94,900.00
minus all Bankruptcy Losses on the Mortgage Loans, if any, previously allocated
to the Certificates in accordance with Section 6.04.
BANKRUPTCY CODE: Title 11 of the United States Code, as the
same may be amended from time to time.
BANKRUPTCY LOSS: With respect to any Mortgage Loan, a Realized
Loss resulting from a Deficient Valuation or Debt Service Reduction.
BENEFICIAL HOLDERS: A Person holding a beneficial interest in
any Book-Entry Certificate through a Participant or an Indirect Participant or a
Person holding a beneficial interest in any Definitive Certificate.
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BOOK-ENTRY CERTIFICATES: The Class A Certificates (other than
the Class A-R and Class A-X Certificates), referred to collectively.
BUSINESS DAY: Any day other than (a) a Saturday or Sunday, (b)
a legal holiday in the State of New York or (c) a day on which banking
institutions in the State of New York are authorized or obligated by law or
executive order to be closed.
CARRY-OVER SUBORDINATED PRINCIPAL AMOUNT: As of any
Distribution Date, with respect to any Class of Subordinated Certificates, an
amount, if any, equal to the amount of principal distributable to such Class on
any prior Distribution Date that has not been so distributed.
CASH LIQUIDATION: Recovery of all cash proceeds by the
Servicer with respect to the liquidation of any Mortgage Loan, including
Insurance Proceeds and other payments or recoveries (whether made at one time or
over a period of time) which the Servicer deems to be finally recoverable, in
connection with the sale, assignment or satisfaction of such Mortgage Loan,
trustee's sale, foreclosure sale or otherwise, but only if title to the related
Mortgaged Property was not acquired by foreclosure or deed in lieu of
foreclosure by the Servicer pursuant to Section 5.21.
CERTIFICATE: Any Class A, Class M or Class B Certificate.
CERTIFICATE ACCOUNT: The account created and maintained
pursuant to Section 4.05.
CERTIFICATEHOLDER or HOLDER: The person in whose name a
Certificate is registered in the Certificate Register, except that, solely for
the purposes of giving any consent, waiver, request or demand pursuant to this
Agreement, any Certificate registered in the name of the Depositor, the
Servicer, any Sub-Servicer, or any of their respective affiliates shall be
disregarded and the undivided Percentage Interest evidenced thereby shall not be
taken into account in determining whether the requisite amount of Percentage
Interests necessary to effect any such consent, waiver, request or demand has
been obtained. The Trustee shall be entitled to conclusively rely upon the
certificate of the Depositor or the Servicer as to the determination of which
Certificates are registered in the name of such affiliates.
CERTIFICATE OWNER: Any Person who is the beneficial owner of a
Book-Entry Certificate registered in the name of the Depository or its nominee.
CERTIFICATE RATE: The per annum rate of interest borne by each
Class of Certificates (other than the Class A-P Certificates), which rate shall
equal 7.25% with respect to the Class X-0, Xxxxx X-0, Class A-3, Class A-4,
Class A-R, Class M, Class B-1, Class B-2, Class B-3, Class B-4 and Class B-5
Certificates, in each case on the Outstanding Certificate Principal Balance of
each Class. In the case of the Class A-X Certificates, the Certificate Rate
shall equal, with respect to any Distribution Date, the weighted average,
expressed as a percentage, of the Stripped Interest Rate on each Non-Discount
Mortgage Loan having a Stripped Interest Rate exceeding zero as of the Due Date
in the month immediately preceding the month in which such Distribution Date
occurs, weighted on the basis of the respective Principal Balances of the
Non-Discount Mortgage Loans, which Principal Balances shall be the Principal
Balances of the Non-Discount Mortgage Loans at the close of business on the
immediately preceding Distribution Date after giving effect to distributions
thereon allocable to principal (or, in the case of the Certificate Rate for the
initial Distribution Date, at the close of business on the Cut-
3
off Date). Interest with respect to each Class of Certificates (other than the
Class A-P Certificates) at the Certificate Rate shall be calculated based on a
360-day year comprised of twelve 30-day months.
CERTIFICATE REGISTER: The register maintained pursuant to
Section 4.02.
CHASE: The Chase Manhattan Bank, a New York State banking
corporation, or its successor in interest.
CLASS: Pertaining to the Class A-1, Class A-2, Class A-3,
Class A-4, Class A-P, Class A-R, Class A-X, Class M, Class B-1, Class B-2, Class
B-3, Class B-4 or Class B-5 Certificates, as the case may be.
CLASS A, CLASS M OR CLASS B: Pertaining to Class A
Certificates, Class M Certificates or Class B Certificates, as the case may be.
CLASS A-3 ACCRETION TERMINATION DATE: The earlier to occur of
(i) the Distribution Date following the Distribution Date on which the aggregate
Outstanding Certificate Principal Balance of the Class A-2 and Class A-3
Certificates has been reduced to zero and (ii) the Distribution Date following
the Credit Support Depletion Date.
CLASS A-P AMOUNT: With respect to any Distribution Date, the
applicable PO Percentage of (i) all principal received on or in respect of each
Discount Mortgage Loan (exclusive of any amounts in respect of any Monthly
Payment) during the related Principal Prepayment Period and (ii) all principal
received as part of a Monthly Payment on or in respect of a Discount Mortgage
Loan during the related Due Period.
CLASS A CERTIFICATES: The Class A-1, Class A-2, Class A-3,
Class A-4, Class A- P, Class A-R and Class A-X Certificates, referred to
collectively.
CLASS A-1 CERTIFICATE: Any one of the Class A-1 Certificates,
executed by the Depositor and authenticated by the Trustee, senior in right of
payment to the Class M and Class B Certificates, substantially in the form of
the Class A Certificate set forth in Exhibit C hereto.
CLASS A-2 CERTIFICATE: Any one of the Class A-2 Certificates,
executed by the Depositor and authenticated by the Trustee, senior in right of
payment to the Class M and Class B Certificates, substantially in the form of
the Class A Certificate set forth in Exhibit C hereto.
CLASS A-3 CERTIFICATE: Any one of the Class A-3 Certificates,
executed by the Depositor and authenticated by the Trustee, senior in right of
payment to the Class M and Class B Certificates, substantially in the form of
the Class A Certificate set forth in Exhibit C hereto.
CLASS A-4 CERTIFICATE: Any one of the Class A-4 Certificates,
executed by the Depositor and authenticated by the Trustee, senior in right of
payment to the Class M and Class B Certificates, substantially in the form of
the Class A Certificate set forth in Exhibit C hereto.
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CLASS A-P CERTIFICATE: Any one of the Class A-P Certificates,
executed by the Depositor and authenticated by the Trustee, senior in right of
payment to the Class M and Class B Certificates, substantially in the form of
the Class A Certificate set forth in Exhibit C hereto.
CLASS A-R CERTIFICATE: The Class A-R Certificate executed by
the Depositor and authenticated by the Trustee, which represents the Residual
Interest, substantially in the form of the Class A-R Certificate set forth in
Exhibit F hereto.
CLASS A-X CERTIFICATE: Any one of the Class A-X Certificates
executed by the Depositor and authenticated by the Trustee, senior in right of
payment to the Class M and Class B Certificates, substantially in the form of
the Class A Certificate set forth in Exhibit C hereto.
CLASS A-1 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution Date, one month's interest at the Certificate Rate on the
Outstanding Certificate Principal Balance of the Class A-1 Certificates minus
(i) any Compensating Interest Shortfall allocated to the Class A-1 Certificates
on such Distribution Date pursuant to Section 6.05(b) and (ii) any Realized Loss
Interest Shortfall resulting from an Excess Loss allocated to the Class A-1
Certificates on such Distribution Date pursuant to Section 6.05(c).
CLASS A-2 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution Date, one month's interest at the Certificate Rate on the
Outstanding Certificate Principal Balance of the Class A-2 Certificates minus
(i) any Compensating Interest Shortfall allocated to the Class A-2 Certificates
on such Distribution Date pursuant to Section 6.05(b) and (ii) any Realized Loss
Interest Shortfall resulting from an Excess Loss allocated to the Class A-2
Certificates on such Distribution Date pursuant to Section 6.05(c).
CLASS A-3 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution Date, one month's interest at the Certificate Rate on the
Outstanding Certificate Principal Balance of the Class A-3 Certificates minus
(i) any Compensating Interest Shortfall allocated to the Class A-3 Certificates
on such Distribution Date pursuant to Section 6.05(b) and (ii) any Realized Loss
Interest Shortfall resulting from an Excess Loss allocated to the Class A-3
Certificates on such Distribution Date pursuant to Section 6.05(c).
CLASS A-4 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution Date, one month's interest at the Certificate Rate on the
Outstanding Certificate Principal Balance of the Class A-4 Certificates minus
(i) any Compensating Interest Shortfall allocated to the Class A-4 Certificates
on such Distribution Date pursuant to Section 6.05(b) and (ii) any Realized Loss
Interest Shortfall resulting from an Excess Loss allocated to the Class A-4
Certificates on such Distribution Date pursuant to Section 6.05(c).
CLASS A-R INTEREST ACCRUAL AMOUNT: With respect to any
Distribution Date, one month's interest at the Certificate Rate on the
Outstanding Certificate Principal Balance of the Class A-R Certificate minus (i)
any Compensating Interest Shortfall allocated to the Class A-R Certificate on
such Distribution Date pursuant to Section 6.05(b) and (ii) any Realized Loss
Interest Shortfall resulting from an Excess Loss allocated to the Class A-R
Certificate on such Distribution Date pursuant to Section 6.05(c).
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CLASS A-X INTEREST ACCRUAL AMOUNT: With respect to any
Distribution Date, one month's interest at the Certificate Rate on the Class A-X
Notional Amount minus (i) any Compensating Interest Shortfall allocated to the
Class A-X Certificates on such Distribution Date pursuant to Section 6.05(b) and
(ii) any Realized Loss Interest Shortfall resulting from an Excess Loss
allocated to the Class A-X Certificates on such Distribution Date pursuant to
Section 6.05(c).
CLASS A-X NOTIONAL AMOUNT: With respect to any Distribution
Date, an amount equal to the aggregate Scheduled Principal Balance of the
Non-Discount Mortgage Loans.
CLASS A PERCENTAGE: As of any Distribution Date, the
percentage obtained by dividing the Class A Principal Balance by the Mortgage
Pool Principal Balance, but not more than 100%.
CLASS A PRINCIPAL BALANCE: As of any Distribution Date, (a)
the Class A Principal Balance for the immediately preceding Distribution Date
less (b) amounts distributed to the Class A Certificateholders on such preceding
Distribution Date allocable to principal (including the principal portion of
Advances of the Servicer made pursuant to Section 6.03 and Realized Losses
allocated to the Class A Certificates pursuant to Section 6.04); provided that
the Class A Principal Balance on the first Distribution Date shall be the
Original Class A Principal Balance.
CLASS A-1 SHORTFALL: With respect to any Distribution Date,
the amount equal to the excess, if any, of the Class A-1 Interest Accrual Amount
over the amount actually distributed to the Class A-1 Certificateholders on such
Distribution Date pursuant to Section 6.01(b)(i)(A).
CLASS A-2 SHORTFALL: With respect to any Distribution Date,
the amount equal to the excess, if any, of the Class A-2 Interest Accrual Amount
over the amount actually distributed to the Class A-2 Certificateholders on such
Distribution Date pursuant to Section 6.01(b)(i)(B).
CLASS A-3 SHORTFALL: With respect to any Distribution Date,
the amount equal to the excess, if any, of the Class A-3 Interest Accrual Amount
over the amount actually distributed to the Class A-3 Certificateholders on such
Distribution Date pursuant to Section 6.01(b)(i)(C).
CLASS A-4 SHORTFALL: With respect to any Distribution Date,
the amount equal to the excess, if any, of the Class A-4 Interest Accrual Amount
over the amount actually distributed to the Class A-4 Certificateholders on such
Distribution Date pursuant to Section 6.01(b)(i)(D).
CLASS A-R SHORTFALL: With respect to any Distribution Date,
the amount equal to the excess, if any, of the Class A-R Interest Accrual Amount
over the amount actually distributed to the Class A-R Certificateholders on such
Distribution Date pursuant to Section 6.01(b)(i)(E).
CLASS A-X SHORTFALL: With respect to any Distribution Date,
the amount equal to the excess, if any, of the Class A-X Interest Accrual Amount
over the amount actually distributed to the Class A-X Certificates on such
Distribution Date pursuant to Section 6.01(b)(i)(F).
CLASS A-P SHORTFALL AMOUNT: With respect to any Distribution
Date prior to and including the Credit Support Depletion Date, to the extent of
amounts available to pay the Subordinated Optimal Principal Amount (without
regard to clause (b)(2) of the definition of such term), an amount equal to the
sum of (i) the applicable PO Percentage of the principal portion of any Realized
6
Loss (other than an Excess Loss) with respect to a Discount Mortgage Loan and
(ii) the sum of amounts, if any, by which the amounts specified in clause (i)
with respect to each prior Distribution Date exceeded the amount actually
distributed in respect thereof on such prior Distribution Date and not
subsequently distributed to the Class A-P Certificateholders.
CLASS B CERTIFICATES: The Class B-1, Class B-2, Class B-3,
Class B-4 and Class B-5 Certificates, referred to collectively.
CLASS B-1 CERTIFICATE: Any one of the Class B-1 Certificates
executed by the Depositor and authenticated by the Trustee, subordinated in
right of payment to the Class A and Class M Certificates, substantially in the
form of the Class B Certificate set forth in Exhibit E hereto.
CLASS B-2 CERTIFICATE: Any one of the Class B-2 Certificates
executed by the Depositor and authenticated by the Trustee, subordinated in
right of payment to the Class A, Class M and Class B-1 Certificates,
substantially in the form of the Class B Certificate set forth in Exhibit E
hereto.
CLASS B-3 CERTIFICATE: Any one of the Class B-3 Certificates
executed by the Depositor and authenticated by the Trustee, subordinated in
right of payment to the Class A, Class M, Class B-1 and Class B-2 Certificates,
substantially in the form of the Class B Certificate set forth in Exhibit E
hereto.
CLASS B-4 CERTIFICATE: Any one of the Class B-4 Certificates
executed by the Depositor and authenticated by the Trustee, subordinated in
right of payment to the Class A, Class M, Class B-1, Class B-2 and Class B-3
Certificates, substantially in the form of the Class B Certificate set forth in
Exhibit E hereto.
CLASS B-5 CERTIFICATE: Any one of the Class B-5 Certificates
executed by the Depositor and authenticated by the Trustee, 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, substantially in the form of the Class B Certificate set
forth in Exhibit E hereto.
CLASS B-1 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution Date, one month's interest at the Certificate Rate on the
Outstanding Certificate Principal Balance of the Class B-1 Certificates minus
(i) any Compensating Interest Shortfall allocated to the Class B-1 Certificates
on such Distribution Date pursuant to Section 6.05(b) and (ii) any Realized Loss
Interest Shortfall resulting from an Excess Loss allocated to the Class B-1
Certificates on such Distribution Date pursuant to Section 6.05(c).
CLASS B-2 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution Date, one month's interest at the Certificate Rate on the
Outstanding Certificate Principal Balance of the Class B-2 Certificates minus
(i) any Compensating Interest Shortfall allocated to the Class B-2 Certificates
on such Distribution Date pursuant to Section 6.05(b) and (ii) any Realized Loss
Interest Shortfall resulting from an Excess Loss allocated to the Class B-2
Certificates on such Distribution Date pursuant to Section 6.05(c).
CLASS B-3 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution Date, one month's interest at the Certificate Rate on the
Outstanding Certificate Principal Balance of the Class
7
B-3 Certificates minus (i) any Compensating Interest Shortfall allocated to the
Class B-3 Certificates on such Distribution Date pursuant to Section 6.05(b) and
(ii) any Realized Loss Interest Shortfall resulting from an Excess Loss
allocated to the Class B-3 Certificates on such Distribution Date pursuant to
Section 6.05(c).
CLASS B-4 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution Date, one month's interest at the Certificate Rate on the
Outstanding Certificate Principal Balance of the Class B-4 Certificates minus
(i) any Compensating Interest Shortfall allocated to the Class B-4 Certificates
on such Distribution Date pursuant to Section 6.05(b) and (ii) any Realized Loss
Interest Shortfall resulting from an Excess Loss allocated to the Class B-4
Certificates on such Distribution Date pursuant to Section 6.05(c).
CLASS B-5 INTEREST ACCRUAL AMOUNT: With respect to any
Distribution Date, one month's interest at the Certificate Rate on the
Outstanding Certificate Principal Balance of the Class B-5 Certificates minus
(i) any Compensating Interest Shortfall allocated to the Class B-5 Certificates
on such Distribution Date pursuant to Section 6.05(b) and (ii) any Realized Loss
Interest Shortfall resulting from an Excess Loss allocated to the Class B-5
Certificates on such Distribution Date pursuant to Section 6.05(c).
CLASS B-1 SHORTFALL: With respect to any Distribution Date,
the amount equal to the excess, if any, of the Class B-1 Interest Accrual Amount
over the amount actually distributed to the Class B-1 Certificates on such
Distribution Date pursuant to Section 6.01(d)(1) (A) and (B).
CLASS B-2 SHORTFALL: With respect to any Distribution Date,
the amount equal to the excess, if any, of the Class B-2 Interest Accrual Amount
over the amount actually distributed to the Class B-2 Certificates on such
Distribution Date pursuant to Section 6.01(d)(2) (A) and (B).
CLASS B-3 SHORTFALL: With respect to any Distribution Date,
the amount equal to the excess, if any, of the Class B-3 Interest Accrual Amount
over the amount actually distributed to the Class B-3 Certificates on such
Distribution Date pursuant to Section 6.01(d)(3) (A) and (B).
CLASS B-4 SHORTFALL: With respect to any Distribution Date,
the amount equal to the excess, if any, of the Class B-4 Interest Accrual Amount
over the amount actually distributed to the Class B-4 Certificates on such
Distribution Date pursuant to Section 6.01(d)(4) (A) and (B).
CLASS B-5 SHORTFALL: With respect to any Distribution Date,
the amount equal to the excess, if any, of the Class B-5 Interest Accrual Amount
over the amount actually distributed to the Class B-5 Certificates on such
Distribution Date pursuant to Section 6.01(d)(5) (A) and (B).
CLASS B PERCENTAGE: As of any Distribution Date, the
difference between 100% and the sum of (i) the Class A Percentage and (ii) the
Class M Percentage for such Distribution Date.
CLASS B PRINCIPAL BALANCE: As of any Distribution Date, the
excess of the Mortgage Pool Principal Balance (together with the principal
portion of any Monthly Payment due but not paid with respect to which an Advance
has not been made) over the sum of (i) the Class A Principal Balance and (ii)
the Class M Principal Balance.
8
CLASS M CERTIFICATE: Any one of the Class M Certificates
executed by the Depositor and authenticated by the Trustee, subordinated in
right of payment to the Class A Certificates, substantially in the form of the
Class M Certificate set forth in Exhibit D hereto.
CLASS M INTEREST ACCRUAL AMOUNT: With respect to any
Distribution Date, one month's interest at the Certificate Rate on the
Outstanding Certificate Principal Balance of the Class M Certificates minus (i)
any Compensating Interest Shortfall allocated to the Class M Certificates on
such Distribution Date pursuant to Section 6.05(b) and (ii) any Realized Loss
Interest Shortfall resulting from an Excess Loss allocated to the Class M
Certificates on such Distribution Date pursuant to Section 6.05(c).
CLASS M PERCENTAGE: As of any Distribution Date, the
percentage obtained by dividing the Class M Principal Balance by the Mortgage
Pool Principal Balance, but not more than 100%; provided, however, that on any
Distribution Date on which the Class B Percentage equals 0%, the Class M
Percentage shall equal 100% minus the Class A Percentage.
CLASS M PRINCIPAL BALANCE: As of any Distribution Date, (a)
the Class M Principal Balance for the immediately preceding Distribution Date
less (b) amounts distributed to the Class M Certificateholders on such preceding
Distribution Date allocable to principal (including the principal portion of
Advances of the Servicer made pursuant to Section 6.03 and Realized Losses
allocated to the Class M Certificates pursuant to Section 6.04); provided that
the Class M Principal Balance on the first Distribution Date shall be the
Original Class M Principal Balance, and provided further that if the aggregate
Outstanding Certificate Principal Balance of the Class B Certificates has been
reduced to zero, as of any Distribution Date, the Class M Principal Balance will
equal the excess of the Mortgage Pool Principal Balance (together with the
portion of any Monthly Payment due but not paid with respect to which an Advance
has not been made) over the Class A Principal Balance.
CLASS M SHORTFALL: With respect to any Distribution Date, the
amount equal to the excess, if any, of the Class M Interest Accrual Amount over
the amount actually distributed to the Class M Certificateholders on such
Distribution Date pursuant to Section 6.01(c)(A) and (B).
CLOSING DATE: January 26, 2001.
CMMC: Chase Manhattan Mortgage Corporation, a New Jersey
corporation, or its successor in interest.
CODE: The Internal Revenue Code of 1986, as amended from time
to time, and any successor statutes thereto, and applicable U.S. Department of
Treasury temporary or final regulations promulgated thereunder.
COLLECTION ACCOUNT: The account created and maintained
pursuant to Section 5.08.
COMPENSATING INTEREST: The meaning specified in Section
6.05(a).
COMPENSATING INTEREST SHORTFALL: The meaning specified in
Section 6.05(b).
9
CO-OP LEASE: With respect to a Co-op Loan, the lease with
respect to a dwelling unit occupied by the Mortgagor and relating to the stock
allocated to the related dwelling unit.
CO-OP LOAN: A Mortgage Loan secured by the pledge of stock
allocated to a dwelling unit in a residential cooperative housing corporation
and a collateral assignment of the related Co-op Lease.
CORPORATE TRUST OFFICE: The principal office of the Trustee at
which at any particular time its corporate trust business shall be administered,
which office at the date of execution of this instrument is located at 000 Xxxx
Xxxxxx, 0xx Xxxxx/Xxxx #0, Xxx Xxxx, Xxx Xxxx 00000.
CREDIT SUPPORT: With respect to each Class of Subordinated
Certificates (other than the Class B-5 Certificates), the level of credit
support supporting such Class, expressed as a percentage of the aggregate
Outstanding Certificate Principal Balance of all Classes of Certificates (other
than the Class A-P Certificates). With respect to each Distribution Date, Credit
Support for each such Class will equal in each case the percentage, rounded to
two decimal places, obtained by dividing the aggregate Outstanding Certificate
Principal Balances immediately prior to such Distribution Date of all Classes of
Subordinated Certificates having higher numerical class designations than such
Class (for this purpose, the Class M Certificates shall be deemed to have a
lower numerical class designation than each Class of Class B Certificates) by
the aggregate Outstanding Certificate Principal Balance of all Classes of
Certificates (other than the Class A-P Certificates) immediately prior to such
Distribution Date.
CREDIT SUPPORT DEPLETION DATE: The first Distribution Date on
which the aggregate Outstanding Certificate Principal Balance of the
Subordinated Certificates has been or will be reduced to zero.
CUT-OFF DATE: January 1, 2001.
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, other than
such a reduction resulting from a Deficient Valuation.
DEFICIENT VALUATION: With respect to any Mortgage Loan, a
valuation of the related Mortgaged Property by a court of competent jurisdiction
in an amount less than the then outstanding principal balance of the Mortgage
Loan, which valuation results from a proceeding initiated under the Bankruptcy
Code.
DEFINITIVE CERTIFICATES: The Certificates referred to in
Section 4.01(c).
DEPOSITOR: Chase Mortgage Finance Corporation, a Delaware
corporation, or its successor in interest or any successor under this Agreement
appointed as herein provided.
DEPOSITORY: The Depository Trust Company, the nominee of which
is Cede & Co.
DEPOSITORY AGREEMENT: The agreement referred to in Section
4.01(b).
10
DEPOSITORY PARTICIPANT: A broker, dealer, bank or other
financial institution or other Person for whom from time to time the Depository
effects book-entry transfers and pledges of securities deposited with the
Depository.
DETERMINATION DATE: The sixteenth day of the month in which
the related Distribution Date occurs (or, if such sixteenth day is not a
Business Day, the preceding Business Day).
DISCOUNT MORTGAGE LOAN: Any Mortgage Loan having a Net
Mortgage Rate less than the Remittance Rate.
DISQUALIFIED ORGANIZATION: An organization referred to in
section 860E(e)(5) of the Code.
DISTRIBUTION DATE: The 25th day of any month, or if such 25th
day is not a Business Day, the first Business Day immediately following,
beginning with February 26, 2001.
DUE DATE: The first day of each month, being the day of the
month on which each Monthly Payment is due on a Mortgage Loan, exclusive of any
days of grace.
DUE PERIOD: With respect to any Distribution Date, the period
from the second day of the month preceding the month in which such Distribution
Date occurs through the first day of the month in which such Distribution Date
occurs.
ELIGIBLE ACCOUNT: An account that is (i) maintained with a
depository institution the long-term unsecured debt obligations of which are
rated by each Rating Agency in one of its two highest rating categories, or (ii)
maintained with the corporate trust department of a national bank or banking
corporation which (a) has a rating of at least Baa3 or P-3 by Moody's and (b) is
either The Chase Manhattan Bank or is the corporate trust department of a
national bank or banking corporation which has a rating of at least A- or F1 by
Fitch, or (iii) an account or accounts the deposits in which are fully insured
by the FDIC, or (iv) an account or accounts in a depository institution in which
such accounts are insured by the FDIC (to the limit established by the FDIC),
the uninsured deposits in which accounts are otherwise secured such that, as
evidenced by an Opinion of Counsel delivered to and acceptable to the Trustee
and each Rating Agency, the Certificateholders have a claim with respect to the
funds in such account and a perfected first security interest against any
collateral (which shall be limited to Eligible 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, provided, however,
that such uninsured deposits do not result in the reduction of the ratings
assigned to the Certificates by the Rating Agencies as evidenced by a letter
from each Rating Agency or (v) otherwise acceptable to each Rating Agency
without reduction or withdrawal of the rating of any Class of Certificates, as
evidenced by a letter from each Rating Agency.
ELIGIBLE INVESTMENTS: One or more of the following:
(i) obligations of, or guaranteed as to principal and interest
by, the United States or obligations of any agency or instrumentality
thereof when such obligations are backed by the full faith and credit
of the United States; provided that any such obligation held as a "cash
flow
11
investment" within the meaning of section 860G(a)(6) of the Code shall
not have a remaining maturity of more than 45 days;
(ii) repurchase agreements on obligations specified in clause
(i) maturing not more than two months from the date of acquisition
thereof, provided that the long-term unsecured obligations of the party
agreeing to repurchase such obligations are at the time rated by each
Rating Agency with its highest rating and the short-term debt
obligations of the party agreeing to repurchase are rated with one of
the two highest ratings by S&P or Fitch;
(iii) federal funds, certificates of deposit, time deposits
and bankers' acceptances (which shall each have an original maturity of
not more than 60 days and, in the case of bankers' acceptances, shall
in no event have an original maturity of more than 365 days) of any
United States depository institution or trust company incorporated
under the laws of the United States or any state, provided that the
long-term unsecured debt obligations of such depository institution or
trust company at the date of acquisition thereof have been rated by
each Rating Agency with its highest rating and the short-term
obligations of such depository institution or trust company are rated
A-1+ by S&P and F-1+ by Fitch if rated by Fitch;
(iv) commercial paper (having original maturities of not more
than 365 days) of any corporation incorporated under the laws of the
United States or any state thereof which on the date of acquisition has
been rated by each Rating Agency in its highest short-term unsecured
commercial paper rating category; provided that such commercial paper
shall have a remaining maturity of not more than 45 days;
(v) units of taxable money market funds (including those for
which the Trustee or the Servicer or any affiliate thereof receives
compensation with respect to such investment) which funds have been
rated by each Rating Agency in its highest rating category or which
have been designated in writing by each Rating Agency as Eligible
Investments with respect to this definition;
(vi) other obligations or securities that are "permitted
investments" within the meaning of Section 860G(a)(5) of the Code and
acceptable to each Rating Agency rating the Certificates as an Eligible
Investment hereunder and will not result in a reduction or withdrawal
in the then current rating of any Class of Certificates, as evidenced
by a letter to such effect from each Rating Agency.
provided that no such instrument shall be an Eligible Investment if such
instrument evidences either (a) a right to receive only interest payments with
respect to the obligations underlying such instrument, or (b) both principal and
interest payments derived from obligations underlying such instrument where the
interest and principal payments with respect to such instrument provide a yield
to maturity of greater than 120% of the yield to maturity at par of such
underlying obligations; and provided further that no such instrument shall be
purchased above par.
ERISA: The Employee Retirement Income Security Act of 1974, as
amended from time to time, and any successor statutes thereto, and applicable
U.S. Department of Labor temporary or final regulations promulgated thereunder.
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ERISA RESTRICTED CERTIFICATE: Any Class B-3, Class B-4 or
Class B-5 Certificate or any other Certificate which at the date of
determination is not rated in one of the four highest generic rating categories
by any Rating Agency.
ESCROW ACCOUNT: The account or accounts created and maintained
pursuant to Section 5.10.
ESCROW PAYMENTS: The amounts constituting applicable ground
rents, taxes, assessments, water rates, Standard Hazard Policy premiums and
other payments required to be escrowed by the Mortgagor with the mortgagee
pursuant to a Mortgage Loan.
EVENT OF DEFAULT: Any of the events specified in Section 9.01.
EXCEPTION REPORT: The report of the Trustee referred to in
Section 2.02.
EXCESS BANKRUPTCY LOSS: Any Bankruptcy Loss, or portion
thereof, which exceeds the then applicable Bankruptcy Amount.
EXCESS FRAUD LOSS: Any Fraud Loss, or portion thereof, which
exceeds the then applicable Fraud Loss Amount.
EXCESS LOSSES: Excess Bankruptcy Losses, Excess Fraud Losses
and Excess Special Hazard Losses, referred to collectively.
EXCESS PROCEEDS: All amounts (net of the related Servicing
Advances) received on any Mortgage Loan (whether as regular principal payments,
Principal Prepayments, Repurchase Proceeds, Liquidation Proceeds, Insurance
Proceeds, condemnation awards, or with respect to a disposition of a Mortgaged
Property which has been acquired by foreclosure or deed in lieu of foreclosure
or otherwise) in excess of the Principal Balance at the Cut-off Date of such
Mortgage Loan and accrued interest thereon at its Mortgage Rate to the Due Date
immediately succeeding the date of prepayment, repurchase or liquidation, as the
case may be.
EXCESS SPECIAL HAZARD LOSS: Any Special Hazard Loss, or
portion thereof, that exceeds the then applicable Special Hazard Amount.
FDIC: The Federal Deposit Insurance Corporation or any
successor organization.
FHLMC: The Federal Home Loan Mortgage Corporation or any
successor organization.
FIDELITY BOND: A fidelity bond and errors and omissions
insurance to be maintained by the Servicer pursuant to Section 5.19.
FITCH: Fitch, Inc. or its successor in interest.
FNMA: The Federal National Mortgage Association, or any
successor organization.
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FNMA GUIDES: The FNMA Sellers' Guide and the FNMA Servicers'
Guide, and all amendments or additions thereto.
FRAUD LOSS: Any Realized Loss or portion thereof sustained by
reason of a default arising from fraud, dishonesty or misrepresentation in
connection with the related Mortgage Loan, including by reason of the denial of
coverage under any related Primary Insurance Policy.
FRAUD LOSS AMOUNT: As of any date of determination after the
Cut-off Date, an amount equal to: (X) prior to the first anniversary of the
Cut-off Date, 2.00% (initially, $4,500,492.00 of the aggregate outstanding
principal balance of all of the Mortgage Loans as of the Cut-off Date minus the
aggregate amount of Fraud Loss on the Mortgage Loans allocated to the
Certificates in accordance with Section 6.04 since the Cut-off Date up to such
date of determination and (Y) from the first to the fifth anniversary of the
Cut-off Date, (1) 1.00% of the aggregate outstanding principal balance of all of
the Mortgage Loans as of the most recent anniversary of the Cut-off Date minus
(2) the Fraud Losses allocated to the Certificates in accordance with Section
6.04 since the most recent anniversary of the Cut- off Date up to such date of
determination. On and after the fifth anniversary of the Cut-off Date, the Fraud
Loss Amount shall be zero.
INDIRECT PARTICIPANT: A broker, dealer, bank or other
financial institution or other Person that clears through or maintains a
custodial relationship with a Depository Participant, either directly or
indirectly.
INSURANCE PROCEEDS: Proceeds paid by any insurer pursuant to
any insurance policy covering a Mortgage Loan, net of costs of collecting such
proceeds and net of amounts released to the Mortgagor or applied to the
restoration of the Mortgaged Property.
INSURED EXPENSES: Expenses covered by any insurance policy.
LATE COLLECTIONS: With respect to any Mortgage Loan, all
amounts received during any Due Period, whether as late payments of Monthly
Payments or as Liquidation Proceeds, condemnation proceeds, Insurance Proceeds,
or with respect to a disposition of a Mortgaged Property which has been acquired
by foreclosure or deed in lieu of foreclosure or otherwise, which represent late
payments or collections of Monthly Payments due but delinquent for a previous
Due Period and not previously recovered.
LIQUIDATED MORTGAGE LOAN: Any Mortgage Loan (a) as to which
the Servicer has determined that all amounts which it expects to recover from or
on account of such Mortgage Loan or property acquired in respect thereof have
been recovered, (b) as to which a Cash Liquidation has taken place or (c) with
respect to which the Mortgaged Property has been acquired by foreclosure or deed
in lieu of foreclosure and a disposition (the term disposition shall include,
for purposes of a repurchase pursuant to Section 11.01, any repurchase of a
Mortgaged Property pursuant to such Section) of such Mortgaged Property has
occurred.
LIQUIDATION EXPENSES: Expenses which are incurred by the
Servicer or any Sub-Servicer in connection with the liquidation of any defaulted
Mortgage Loan or property acquired in respect thereof including, without
limitation, legal fees and expenses, any unreimbursed amount expended by the
Servicer pursuant to Sections 5.16 and 5.21 respecting the related Mortgage Loan
and
14
any related and unreimbursed expenditures for real estate property taxes or for
property restoration or preservation.
LIQUIDATION PROCEEDS: Cash (including Insurance Proceeds)
received by the Servicer in connection with the liquidation of any Mortgage Loan
or Mortgaged Property acquired in respect thereof, whether through the sale or
assignment of such Mortgage Loan (other than pursuant to Section 5.21),
trustee's sale, foreclosure sale or otherwise, or the sale of the Mortgaged
Property if the Mortgaged Property is acquired in satisfaction of the Mortgage
Loan other than amounts required to be paid to the Mortgagor pursuant to law or
the terms of the applicable Mortgage Note.
LOAN-TO-VALUE RATIO: The fraction, expressed as a percentage,
the numerator of which is the principal amount of the related Mortgage Loan at
the time of origination (or, (i) for purposes of Section 5.15, at the time of
determination and (ii) for purposes of a Mortgage Loan with respect to which a
conversion from adjustable rate to fixed rate has occurred, at the time of
initial origination) and the denominator of which is the appraised value of the
related Mortgaged Property at the time of initial origination or, in the case of
a Mortgage Loan financing the acquisition of the Mortgaged Property, the sales
price of the Mortgaged Property, if such sales price is less than such appraised
value.
LOCKOUT PERCENTAGE: With respect to any Distribution Date, the
lesser of (I) (A) the Outstanding Certificate Principal Balance of the Class A-4
Certificates divided by (B) the Non-PO Allocated Amount, in each case
immediately prior to the Distribution Date and (II) 100.00%.
LOCKOUT PRINCIPAL DISTRIBUTION AMOUNT: With respect to any
Distribution Date, the Lockout Percentage of the Step Down Percentage of the
Non-PO Class A Optimal Principal Amount.
MODIFIED MORTGAGE LOAN: Any Mortgage Loan which the Servicer
has modified pursuant to Section 5.01.
MONTHLY PAYMENT: The minimum required monthly payment of
principal and interest due on a Mortgage Loan as specified in the Mortgage Note
for any Due Date (before any adjustment to such scheduled amount by reason of
any bankruptcy or similar proceeding or any moratorium or similar waiver or
grace period). Monthly Payments shall be deemed due on an Outstanding Mortgage
Loan until such time as it becomes a Liquidated Mortgage Loan.
MOODY'S: Xxxxx'x Investors Service, Inc. or its successor in
interest.
MORTGAGE: With respect to a Mortgage Loan that is not a Co-op
Loan, the mortgage, deed of trust or other instrument creating a first lien or a
first priority ownership interest in an estate in fee simple in real property
securing a Mortgage Note. With respect to a Co-op Loan, the security agreement
creating a security interest in the stock allocated to a dwelling unit in a
residential cooperative housing corporation and pledged to secure such Co-op
Loan and the related Co-op Lease.
MORTGAGE FILE: As to each Mortgage Loan, the items referred to
in Exhibit B annexed hereto.
15
MORTGAGE LOAN: An individual mortgage loan and all rights with
respect thereto, evidenced by a Mortgage and a Mortgage Note, sold and assigned
by the Depositor to the Trustee and which is subject to this Agreement and
included in the Trust Fund. The Mortgage Loans originally sold and subject to
this Agreement are identified on the Mortgage Loan Schedule.
MORTGAGE LOAN SCHEDULE: The schedule of Mortgage Loans
attached hereto as Exhibit A as it may be amended in accordance with Section
3.03, setting forth the following information as to each Mortgage Loan: (i) the
Mortgage Loan identifying number; (ii) the street address of the Mortgaged
Property (or Underlying Mortgaged Property, in the case of a Co-op Loan),
including the zip code; (iii) an indication of whether the Mortgaged Property
(or the related residential dwelling unit in the Underlying Mortgaged Property,
in the case of a Co-op Loan), is owner-occupied; (iv) the property type of the
Mortgaged Property; (v) the original number of months to stated maturity; (vi)
the number of months remaining to stated maturity from the Cut-off Date; (vii)
the original Loan-to-Value Ratio; (viii) the original principal balance of the
Mortgage Loan; (ix) the unpaid principal balance of the Mortgage Loan as of the
close of business on the Cut-off Date; (x) the Mortgage Rate; (xi) the amount of
the current Monthly Payment; and (xii) the PO Percentage with respect to such
Mortgage Loan.
MORTGAGE NOTE: The note or other evidence of the indebtedness
of a Mortgagor secured by a Mortgage.
MORTGAGE POOL: The pool of Mortgage Loans held in the Trust
Fund.
MORTGAGE POOL PRINCIPAL BALANCE: As of any date of
determination, the aggregate of the Principal Balances of each Outstanding
Mortgage Loan on such date of determination less the principal portion of any
Monthly Payment due but not paid with respect to which an Advance has not been
made, initially $225,024,611.66.
MORTGAGED PROPERTY: The property securing a Mortgage Note.
MORTGAGE RATE: With respect to each Mortgage Loan, the per
annum rate of interest borne by the Mortgage Loan, as specified in the Mortgage
Note. The Mortgage Rate for any Mortgage Loan shall be zero with respect to the
period prior to the period during which interest accrues with respect to such
Mortgage Loan's first Monthly Payment.
MORTGAGOR: The obligor on a Mortgage Note.
NET LIQUIDATION PROCEEDS: As to any Liquidated Mortgage Loan,
Liquidation Proceeds net of Liquidation Expenses.
NET MORTGAGE RATE: With respect to each Mortgage Loan, a per
annum rate of interest for the applicable period equal to the Mortgage Rate less
the Servicing Fee.
NON-DISCOUNT MORTGAGE LOANS: The Mortgage Loans having Net
Mortgage Rates in excess of the Remittance Rate.
NON-PO ALLOCATED AMOUNT: At the time of any determination, the
amount derived by (i) multiplying the Principal Balance of each Outstanding
Mortgage Loan on such date of
16
determination by the Non-PO Percentage with respect to such Mortgage Loan and
(ii) summing the results.
NON-PO CLASS A CERTIFICATES: The Class A-1, Class A-2, Class
A-3, Class A-4, Class A-R and Class A-X Certificates, referred to collectively.
NON-PO CLASS A OPTIMAL PRINCIPAL AMOUNT: With respect to any
Distribution Date, the lesser of (a) the Non-PO Class A Principal Balance and
(b) the sum of:
(i) the Non-PO Class A Percentage of the applicable Non-PO
Percentage of the principal portion of all Monthly Payments, whether or
not received, which were due during the related Due Period on Mortgage
Loans which were outstanding during such Due Period;
(ii) the Non-PO Class A Prepayment Percentage of the
applicable Non-PO Percentage of all Principal Prepayments made on any
Mortgage Loan during the related Principal Prepayment Period;
(iii) with respect to each Mortgage Loan not described in (iv)
below, the Non-PO Class A Percentage of the applicable Non-PO
Percentage of the principal portion of all Insurance Proceeds,
condemnation awards and any other cash proceeds from a source other
than the applicable Mortgagor, to the extent required to be deposited
in the Collection Account pursuant to Section 5.08(iv) and (v), which
were received during the related Principal Prepayment Period, net of
related unreimbursed Servicing Advances and net of any portion thereof
which, as to any such Mortgage Loan, constitutes Late Collections that
have been the subject of an Advance on any prior Distribution Date;
(iv) with respect to each Mortgage Loan which has become a
Liquidated Mortgage Loan during the related Principal Prepayment
Period, the lesser of (A) the Non-PO Class A Percentage of applicable
Non-PO Percentage of an amount equal to the Principal Balance of such
Liquidated Mortgage Loan as of the Due Date immediately preceding the
date on which it became a Liquidated Mortgage Loan and (B) the Non-PO
Class A Prepayment Percentage of the applicable Non-PO Percentage of
the Net Liquidation Proceeds with respect to such liquidated Mortgage
Loan (net of any unreimbursed Advances);
(v) with respect to each Mortgage Loan repurchased during the
related Principal Prepayment Period pursuant to Section 2.02, 3.01,
5.01, 5.21 or 11.01, an amount equal to the Non-PO Class A Prepayment
Percentage of the applicable Non-PO Percentage of the principal portion
of the Purchase Price (net of amounts with respect to which a
distribution of principal has previously been made to the Non-PO Class
A Certificateholders); and
(vi) on or after the Credit Support Depletion Date, the excess
of the Non-PO Class A Principal Balance (calculated after giving effect
to reductions thereof on such Distribution Date with respect to the
amounts described in (i) - (v) above) over the Non-PO Allocated Amount,
if any, as of the preceding Distribution Date.
NON-PO CLASS A PERCENTAGE: As of any Distribution Date, the
fraction, expressed as a percentage (which shall never exceed 100%), the
numerator of which is the Non-PO Class
17
A Principal Balance and the denominator of which is the Non-PO Allocated Amount
as of the immediately preceding Due Date.
NON-PO CLASS A PREPAYMENT PERCENTAGE: As of any Distribution
Date up to and including the Distribution Date in January 2006, 100%; as of any
Distribution Date during the first year thereafter, the Non-PO Class A
Percentage plus 70% of the Subordinated Percentage for such Distribution Date;
as of any Distribution Date during the second year thereafter, the Non-PO Class
A Percentage plus 60% of the Subordinated Percentage for such Distribution Date;
as of any Distribution Date during the third year thereafter, the Non-PO Class A
Percentage plus 40% of the Subordinated Percentage for such Distribution Date;
as of any Distribution Date during the fourth year thereafter, the Non-PO Class
A Percentage plus 20% of the Subordinated Percentage for such Distribution Date;
and as of any Distribution Date after the fourth year thereafter, the Non-PO
Class A Percentage; provided that if the Non-PO Class A Percentage as of any
such Distribution Date is greater than the Non-PO Class A Percentage on the
first Distribution Date, the Non-PO Class A Prepayment Percentage shall be 100%;
and provided further that whenever the Non-PO Class A Percentage equals 0%, the
Non-PO Class A Prepayment Percentage shall equal 0%; and provided further,
however, that no reduction of the Non-PO Class A Prepayment Percentage below the
level in effect for the most recent period shall occur with respect to any
Distribution Date unless, as of the last day of the month preceding such
Distribution Date, (A) the aggregate outstanding Principal Balance of the
Outstanding Mortgage Loans 60 days or more delinquent (including Mortgage Loans
in foreclosure and with respect to which the related Mortgaged Property has been
acquired by the Trust Fund) does not exceed 50% of the aggregate Outstanding
Certificate Balance of the Subordinated Certificates as of such date and (B)
cumulative Realized Losses through the last day of the month preceding such
Distribution Date (including Nonrecoverable Advances) do not exceed (i) if such
Distribution Date occurs between February 2006 and January 2007 inclusive, 30%
of the Original Subordinated Principal Balance, (ii) if such Distribution Date
occurs between February 2007 and January 2008 inclusive, 35% of the Original
Subordinated Principal Balance, (iii) if such Distribution Date occurs between
February 2008 and January 2009 inclusive, 40% of the Original Subordinated
Principal Balance, (iv) if such Distribution Date occurs between February 2009
and January 2010 inclusive, 45% of the Original Subordinated Principal Balance
and (v) if such Distribution Date occurs in February 2010 and thereafter, 50% of
the Original Subordinated Principal Balance.
NON-PO CLASS A PRINCIPAL BALANCE: As of any Distribution Date,
(a) the Non- PO Class A Principal Balance for the immediately preceding
Distribution Date less (b) amounts distributed (or deemed distributed) to the
Non-PO Class A Certificateholders on such preceding Distribution Date allocable
to principal (including the principal portion of Advances of the Servicer made
pursuant to Section 6.03 and Realized Losses allocated to the Non-PO Class A
Certificates pursuant to Section 6.04); provided that the Non-PO Class A
Principal Balance on the first Distribution Date shall be the Original Non-PO
Class A Principal Balance.
NON-PO CLASS A PRINCIPAL PAYMENT RULES: (I) With respect to
any Distribution Date prior to the Credit Support Depletion Date, distributions
to the Non-PO Class A Certificateholders pursuant to Section 6.01(b)(ii)(A)
shall be made in the following amounts and priority:
first, to the Class A-R Certificate until the Outstanding Certificate
Principal Balance of such Class has been reduced to zero; and
18
second, to the Class A-1, Class A-2, Class A-3 and Class A-4
Certificates as follows: concurrently, of the amounts remaining after making the
distributions in clause first above, (A) 11.60988654% to the Class A-1
Certificates, until the Outstanding Certificate Principal Balance of such Class
has been reduced to zero, and (B) 88.39011346% as follows: first, to the Class
A-4 Certificates, up to the Lockout Principal Distribution Amount until the
Outstanding Certificate Principal Balance of such Class has been reduced to
zero, and second, sequentially, to the Class A-2, Class A-3 and Class A-4
Certificates, until the Outstanding Certificate Principal Balance of each such
Class has been reduced to zero.
(II) With respect to any Distribution Date on or after the Credit
Support Depletion Date, distributions pursuant to Section 6.01(b)(ii)(A) shall
be made pro rata among the outstanding Classes of Non-PO Class A Certificates in
relation to the respective Outstanding Certificate Principal Balances of such
outstanding Classes, and not in accordance with the priority of payments among
such Classes set forth in clause (I) above.
NON-PO PERCENTAGE: With respect to each Mortgage Loan, the
fraction, expressed as a percentage (but not greater than 100%), the numerator
of which equals the applicable Net Mortgage Rate and the denominator of which
equals the Remittance Rate.
NONRECOVERABLE ADVANCE: Any Advance previously made or
proposed to be made in respect of a Mortgage Loan by the Servicer pursuant to
Section 6.03 which, in the good faith judgment of the Servicer, will not or, in
the case of a proposed Advance, would not, ultimately be recoverable by the
Servicer from Late Collections or otherwise. The determination by the Servicer
that it has made, or would be making, a Nonrecoverable Advance shall be
evidenced by a certificate of a Servicing Officer of the Servicer delivered to
the Trustee, any co-trustee and the Depositor and detailing the reasons for such
determination.
OFFICERS' CERTIFICATE: A certificate signed by two of the
Chairman of the Board, the Vice Chairman of the Board, the President or a Vice
President, the Treasurer or the Secretary or one of the Assistant Treasurers or
Assistant Secretaries or any other duly authorized officer of the Depositor or
the Servicer, and delivered to the Trustee.
OPINION OF COUNSEL: A written opinion of counsel, who may be
counsel for the Depositor or the Servicer and who is reasonably acceptable to
the Trustee.
ORIGINAL CERTIFICATE PRINCIPAL BALANCE: With respect to any
Class of Certificates, the amount specified for such Class in Section 4.01(d).
ORIGINAL CLASS A PRINCIPAL BALANCE: $215,461,064.00
ORIGINAL CLASS M PRINCIPAL BALANCE: $ 3,600,393.00
ORIGINAL CLASS B PRINCIPAL BALANCE: $ 5,963,154.43
ORIGINAL NON-PO CLASS A PRINCIPAL
BALANCE: $215,333,715.00
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ORIGINAL CREDIT SUPPORT: With respect to any Class of
Subordinated Certificates (other than the Class B-5 Certificates), the level of
Credit Support indicated below:
Class M: 2.65%
Class B-1: 1.50%
Class B-2: 1.00%
Class B-3: 0.60%
Class B-4: 0.35%
ORIGINAL SUBORDINATED PRINCIPAL BALANCE: The aggregate
Original Certificate Principal Balance of the Subordinated Certificates.
OUTSTANDING CERTIFICATE PRINCIPAL BALANCE: With respect to any
Class (other than the Class A-X Certificates) of Certificates and any
Distribution Date, the Original Certificate Principal Balance of such Class
minus the sum of (i) any distributions of principal made on such Class prior to
such Distribution Date and (ii) any Realized Losses allocated to such Class
prior to such Distribution Date plus, in the case of the Class A-3 Certificates,
on each Distribution Date prior to the Class A-3 Accretion Termination Date, the
amounts calculated for such Distribution Date pursuant to Section 6.01(b)(i)(C);
provided, however, that (I) with respect to the Class of Class B Certificates
then outstanding having the highest numerical class designation, the Outstanding
Certificate Principal Balance of such Class shall equal the excess of the
Mortgage Pool Principal Balance (together with the principal portion of any
Monthly Payment due but not paid with respect to which an Advance has not been
made) over the sum of the Outstanding Certificate Principal Balances of all
Classes of Certificates (other than the Class of Class B Certificates then
outstanding having the highest numerical class designation); and (II) during
such time as the Outstanding Certificate Principal Balance of the Class B-1
Certificates equals zero, with respect to the Class M Certificates, the
Outstanding Certificate Principal Balance of such Class shall equal the excess
of the Mortgage Pool Principal Balance (together with the principal portion of
any Monthly Payment due but not paid with respect to which an Advance has not
been made) over the Class A Principal Balance.
OUTSTANDING MORTGAGE LOAN: As to any Distribution Date, a
Mortgage Loan which was not paid in full during the related or any previous
Principal Prepayment Period, which did not become a Liquidated Mortgage Loan
during the related or any previous Principal Prepayment Period and which was not
repurchased under Section 2.02, 3.01, 5.01, 5.21 or 11.01 during the related or
any previous Principal Prepayment Period.
PASS-THRU ENTITY: A "Pass-Thru Entity" as defined in Section
860E(e)(6) of the Code.
PAYING AGENT: The Person appointed by the Trustee as Paying
Agent pursuant to Section 4.05.
PERCENTAGE INTEREST: As to any Certificate (other than the
Class A-X Certificates), the percentage interest evidenced thereby in
distributions required to be made hereunder, such percentage interest being
equal, with respect to any Class, to the percentage obtained by dividing the
Outstanding Certificate Principal Balance of such Certificate by the aggregate
of the Outstanding Certificate Principal Balances of all the Certificates of
such Class and with respect to all Certificates, the
20
percentage obtained by dividing the Outstanding Certificate Principal Balance of
such Certificate by the aggregate of the Outstanding Certificate Principal
Balances of all the Certificates. With respect to any Class A-X Certificate, the
percentage interest specified on the face of such Certificate.
PERSON: Any individual, corporation, partnership, limited
liability company, limited liability partnership, joint venture, association,
joint-stock company, trust, unincorporated organization or government or any
agency or political subdivision thereof.
PO PERCENTAGE: The PO Percentage with respect to each Mortgage
Loan as identified on the Mortgage Loan Schedule, such percentage being equal to
the fraction, expressed as a percentage (but not less than 0%), the numerator of
which equals the excess of the Remittance Rate over the applicable Net Mortgage
Rate and the denominator of which equals the Remittance Rate.
PRIMARY INSURANCE POLICY: Each primary policy of mortgage
guaranty insurance or any replacement policy therefor referred to in Section
5.15 hereof.
PRINCIPAL BALANCE: At the time of any determination, the
principal balance of a Mortgage Loan remaining to be paid at the close of
business on the Cut-off Date (after deduction of all principal payments due on
or before the Cut-off Date whether or not paid) (or, in the case of a substitute
Mortgage Loan included in the Trust Fund pursuant to Section 3.04, the close of
business as of the date of substitution) reduced by all amounts previously
distributed to Certificateholders that are allocable to payments of principal on
such Mortgage Loan (including the principal portion of Advances of the Servicer
made pursuant to Section 6.03).
PRINCIPAL PREPAYMENT: Any payment or other recovery of
principal on a Mortgage Loan (other than Late Collections) which is received
other than as part of a Monthly Payment; provided, however, that the term
Principal Prepayment does not include Insurance Proceeds, Liquidation Proceeds,
condemnation awards or other cash proceeds from a source other than the
applicable Mortgagor.
PRINCIPAL PREPAYMENT PERIOD: With respect to any Distribution
Date, the period beginning on the first day of the month preceding the month in
which such Distribution Date occurs and ending on the last day of such month.
PURCHASE PRICE: With respect to any Mortgage Loan required to
be purchased on any date pursuant to Section 2.02, 3.01, 5.01, 5.21 or 11.01, an
amount equal to the sum of (a) 100% of the Principal Balance thereof, (b) unpaid
accrued interest at the Mortgage Rate thereon from the Due Date on which
interest was last paid by the Mortgagor or Advanced by the Servicer to the Due
Date next following the date of repurchase and (c) the aggregate of any
unreimbursed Advances and any unreimbursed Servicing Advances.
QUALIFIED INSURER: An insurance company duly qualified as such
under the laws of the states in which the Mortgaged Properties are located, duly
authorized and licensed in such states to transact the applicable insurance
business and to write the insurance provided, approved as an insurer by FNMA and
FHLMC and whose claims-paying ability is rated in the two highest rating
categories by S&P and Fitch with respect to primary mortgage insurance and in
the two highest rating categories for general
21
policyholder rating and financial performance index rating by A.M. Best Company
or its successor in interest with respect to hazard and flood insurance.
RATING AGENCY: Any nationally recognized statistical rating
organization, or its successor, that rated one or more Classes of Certificates
at the request of the Depositor at the time of the initial issuance of the
Certificates. If such organization or a successor is no longer in existence,
"Rating Agency" shall be such nationally recognized statistical rating
organization, or other comparable Person, designated by the Depositor, notice of
which designation shall be given to the Trustee and the Servicer. References
herein to the two highest long-term debt rating categories of a Rating Agency
shall mean AA or better in the case of S&P and in the case of Fitch.
REALIZED LOSS: With respect to (i) a Liquidated Mortgage Loan,
the amount, if any, by which the unpaid Principal Balance and accrued interest
thereon at a rate equal to the Net Mortgage Rate exceeds the amount actually
recovered by the Servicer with respect thereto (net of reimbursement of Advances
and Servicing Advances) at the time such Mortgage Loan became a Liquidated
Mortgage Loan or (ii) with respect to a Mortgage Loan which is not a Liquidated
Mortgage Loan, any amount of principal that the Mortgagor is no longer legally
required to pay (except for the extinguishment of debt that results from the
exercise of remedies due to default by the Mortgagor).
REALIZED LOSS INTEREST SHORTFALL: The meaning specified in
Section 6.05(c).
RECORD DATE: The close of business of the last Business Day of
the month preceding the month of the related Distribution Date.
RELEVANT MORTGAGE LOAN: The meaning specified in Section 5.01.
REMIC: A "real estate mortgage investment conduit," as such
term is defined in Section 860D of the Code. References herein to "the REMIC"
shall mean the REMIC created hereunder.
REMIC PROVISIONS: Provisions of the federal income tax law
relating to REMICs which appear at Sections 860A through 860G of Part IV of
Subchapter M of Chapter 1 of Subtitle A of the Code, and related provisions, and
U.S. Department of the Treasury temporary, proposed or final regulations and
rulings promulgated thereunder, as the foregoing are in effect (or with respect
to proposed regulations, are proposed to be in effect) from time to time.
REMITTANCE RATE: 7.25% per annum.
REPURCHASE PROCEEDS: All proceeds of any Mortgage Loan or
property acquired in respect thereof repurchased pursuant to Section 2.02, 3.01,
5.01, 5.21 or 11.01.
RESIDUAL INTEREST: The interest in the Trust Fund represented
by amounts, if any, remaining in the Collection Account following termination of
the Trust Fund after payments to the Class A Certificateholders (other than the
Class A-R Certificateholder), the Class M Certificateholders and the Class B
Certificateholders.
22
RESPONSIBLE OFFICER: When used with respect to the Trustee,
any Senior Vice President, any Vice President, any Assistant Vice President, any
Senior Trust Officer, any Trust Officer or any other officer of the Trustee in
its Corporate Trust Office customarily performing functions similar to those
performed by any of the above designated officers and also, with respect to a
particular matter, any other officer in its Corporate Trust Office to whom such
matter is referred because of such officer's knowledge of and familiarity with
the particular subject.
S&P: Standard & Poor's Ratings Services, a division of The
XxXxxx-Xxxx Companies, Inc. or its successor in interest.
SALE AGREEMENT: The Mortgage Loan Sale Agreement dated as of
January 26, 2001 between the Depositor and CMMC.
SCHEDULED PRINCIPAL BALANCE: With respect to any Mortgage Loan
as of any Distribution Date, the unpaid principal balance of such Mortgage Loan
as specified in the amortization schedule at the time relating thereto (before
any adjustment to such schedule by reason of bankruptcy or similar proceeding or
any moratorium or similar waiver or grace period) as of the Due Date in the
month preceding the month of such Distribution Date, or as the Cut-off Date,
with respect to the first Distribution Date, after giving effect to any
previously applied prepayments, the payment of principal due on such first day
of the month and any reduction of the principal balance of such Mortgage Loan by
a bankruptcy court, irrespective of any delinquency in payment by the related
Mortgagor.
SELLER: CMMC.
SERVICER: CMMC or any successor under this Agreement as herein
provided.
SERVICING ADVANCES: All customary, reasonable and necessary
"out of pocket" costs and expenses incurred in the performance by the Servicer
of its servicing obligations and which are "unanticipated expenses" of the
REMIC, as defined in the REMIC Provisions, including, but not limited to, the
cost of (i) the preservation, restoration and protection of the Mortgaged
Property (or Underlying Mortgaged Property, in the case of a Co-op Loan), (ii)
any enforcement or judicial proceedings, including foreclosures, (iii) the
management and liquidation of the Mortgaged Property if the Mortgaged Property
is acquired in satisfaction of the Mortgage, (iv) taxes and assessments on the
Mortgaged Properties subject to the Mortgage Loans and (v) compliance with the
obligations under Section 5.21.
SERVICING FEE: The amount of the monthly fee paid for the
servicing of the Mortgage Loans, equal to, as of any Distribution Date, the
total of, with respect to each Mortgage Loan, one-twelfth of 0.3139% per annum
of the Principal Balance thereof as of the Determination Date in the preceding
month, subject to adjustment as provided in Section 6.05. The Servicing Fee
shall be payable only at the time of and with respect to those Mortgage Loans
for which payment is in fact made of the entire amount of the Monthly Payments
that shall have come due and only at the time such Monthly Payment shall be
made. The right to receive the Servicing Fee is limited to, and the Servicing
Fee is payable solely from, the interest portion of such Monthly Payments (or
the interest portion of any Principal Prepayment in full) collected by the
Servicer, or as otherwise provided under Section 5.09 or 5.23.
23
SERVICING OFFICER: Any officer of the Servicer or any
Sub-Servicer involved in, or responsible for, the administration and servicing
of the Mortgage Loans whose name appears on a written certificate listing
servicing officers furnished to the Trustee by the Servicer on or prior to the
Closing Date, and signed on behalf of the Servicer or any Sub-servicer by its
President, any Vice President or its Treasurer, as such certificate may from
time to time be amended.
SIMILAR LAW: The meaning specified in Section 4.02(d).
SINGLE CERTIFICATE: A Certificate of any Class that evidences
the smallest permissible original denomination for such Class of Certificates as
specified in Section 4.01(d).
SPECIAL HAZARD AMOUNT: Initially, $2,960,596.00. As of the
first anniversary of the Cut-off Date, the Special Hazard Amount shall be
reduced, but not increased, to the lesser of (i) the initial Special Hazard
Amount less the sum of all amounts allocated to the Subordinated Certificates in
respect of Special Hazard Losses on the Mortgage Loans during such year and (ii)
the Adjustment Amount for such anniversary. As of each subsequent anniversary of
the Cut-off Date, the Special Hazard Amount shall be reduced, but not increased,
to the lesser of (i) the Special Hazard Amount on the immediately preceding
anniversary of the Cut-off Date less the sum of all amounts allocated to the
Subordinated Certificates in respect of Special Hazard Losses on the Mortgage
Loans during such year and (ii) the Adjustment Amount for such anniversary. The
"Adjustment Amount" with respect to each anniversary of the Cut-off Date will be
equal to the greatest of (i) 1.00% multiplied by the aggregate outstanding
Principal Balance of the Mortgage Loans, (ii) the aggregate outstanding
Principal Balance of the Mortgage Loans secured by Mortgaged Properties located
in the California postal zip code area in which the highest percentage of
Mortgage Loans by Principal Balance are located and (iii) twice the outstanding
Principal Balance of the Mortgage Loan having the largest outstanding Principal
Balance.
SPECIAL HAZARD LOSS: With respect to any Mortgage Loan, any
Realized Loss or portion thereof resulting from direct physical loss or damage
to the related Mortgaged Property (or Underlying Mortgaged Property, in the case
of a Co-op Loan), which is not insured against under the Standard Hazard Policy
required to be maintained hereunder.
STANDARD HAZARD POLICY: Each standard hazard insurance policy
or replacement therefor referred to in Section 5.16.
STARTUP DAY: The meaning specified in Section 2.04(a).
STEP-DOWN PERCENTAGE: With respect to any Distribution Date,
the percentage indicated below:
Distribution Date Occurring in Step Down Percentage
------------------------------ --------------------
February 2001 through January 2006............ 0%
February 2006 through January 2007............ 30%
February 2007 through January 2008............ 40%
February 2008 through January 2009............ 60%
February 2009 through January 2010............ 80%
February 2010 and thereafter.................. 100%
24
STRIPPED INTEREST RATE: For each Mortgage Loan, the excess, if
any, of the Net Mortgage Rate for such Mortgage Loan over the Remittance Rate.
SUBORDINATED CERTIFICATES: The Class M and Class B
Certificates, referred to collectively.
SUBORDINATED OPTIMAL PRINCIPAL AMOUNT: With respect to any
Distribution Date, the lesser of (a) the aggregate Outstanding Certificate
Principal Balance of the Subordinated Certificates (before giving effect to any
distributions of principal on such Distribution Date) and (b)(1) the sum of: (i)
the Subordinated Percentage of the applicable Non-PO Percentage of the principal
portion of all Monthly Payments, whether or not received, which were due during
the related Due Period on Mortgage Loans which were outstanding during such Due
Period; (ii) the Subordinated Prepayment Percentage of the applicable Non-PO
Percentage of all Principal Prepayments made on any Mortgage Loan during the
related Principal Prepayment Period; (iii) with respect to each Mortgage Loan
not described in (iv) below, the Subordinated Percentage of the applicable
Non-PO Percentage of the principal portion of all Insurance Proceeds,
condemnation awards and any other cash proceeds from a source other than the
applicable Mortgagor, to the extent required to be deposited in the Collection
Account pursuant to Section 5.08(iv) and (v), which were received during the
related Principal Prepayment Period, net of related unreimbursed Servicing
Advances and net of any portion thereof which, as to any such Mortgage Loan,
constitutes Late Collections that have been the subject of an Advance on any
prior Distribution Date; (iv) with respect to each Mortgage Loan which has
become a Liquidated Mortgage Loan during the related Principal Prepayment
Period, an amount equal to the portion (if any) of the Net Liquidation Proceeds
with respect to such liquidated Mortgage Loan (net of any unreimbursed Advances)
that was not included in the Class A-P Amount or the Non-PO Class A Optimal
Principal Amount with respect to such Distribution Date; and (v) with respect to
each Mortgage Loan repurchased during the related Principal Prepayment Period
pursuant to Section 2.02, 3.01, 5.01, 5.21 or 11.01, an amount equal to the
Subordinated Prepayment Percentage of the applicable Non-PO Percentage of the
principal portion of the Purchase Price (net of amounts with respect to which a
distribution of principal has previously been made to the Subordinated
Certificateholders) minus (2) the Class A-P Shortfall Amount with respect to
such Distribution Date.
SUBORDINATED PERCENTAGE: As of any Distribution Date, the
difference between 100% and the Non-PO Class A Percentage.
SUBORDINATED PREPAYMENT PERCENTAGE: As of any Distribution
Date, the difference between 100% and the Non-PO Class A Prepayment Percentage.
SUB-SERVICER: Any Person with whom the Servicer enters into a
Sub-Servicing Agreement.
SUB-SERVICING AGREEMENT: Any agreement between the Servicer
and any Sub-Servicer, relating to servicing or administration of certain
Mortgage Loans as provided in Section 5.02, in such form as has been approved by
the Servicer and the Depositor.
SUBSTITUTE EXCESS INTEREST: As defined in Section 3.03.
25
TRUST: The Trust created pursuant to this Agreement.
TRUST FUND: The corpus of the Trust consisting of (i) the
Mortgage Loans, (ii) such assets as shall from time to time be identified as
deposited in the Collection Account and the Certificate Account, (iii) property
which secured a Mortgage Loan and which has been acquired by foreclosure or deed
in lieu of foreclosure, (iv) Standard Hazard Policies and any other insurance
policies, and the proceeds thereof and (v) any proceeds of any of the foregoing.
TRUSTEE: Citibank, N.A., a national banking association and
its successors and any corporation resulting from or surviving any consolidation
or merger to which it or its successors may be a party, and any successor
trustee at the time serving as successor trustee hereunder, appointed as herein
provided.
UNDERLYING MORTGAGED PROPERTY: With respect to each Co-op
Loan, the underlying real property owned by the related residential cooperative
housing corporation.
U.S. PERSON: A "United States Person" as defined in Section
7701(a)(30) of the Code.
[END OF ARTICLE I]
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS; TRUST FUND
Section 2.01. Conveyance of Mortgage Loans. The Depositor, concurrently
with the execution and delivery hereof, does hereby sell, transfer, assign, set
over and convey to the Trustee without recourse all the right, title and
interest of the Depositor in and to the Mortgage Loans, including all interest
and principal received on or with respect to the Mortgage Loans on or after the
Cut-off Date (other than Monthly Payments due on the Mortgage Loans on or before
the Cut-off Date).
In connection with such assignment, the Depositor does hereby deliver
to, and deposit with, the Trustee the following documents or instruments with
respect to each Mortgage Loan so assigned:
(i) With respect to each Mortgage Loan which is not a Co-op Loan:
(A)(I) Original Mortgage Note (or a lost note affidavit
(including a copy of the original Mortgage Note)) or (II) original
consolidation, extension and modification agreement (or a lost note
affidavit (including a copy of the original consolidation, extension
and modification agreement)), in either case endorsed "Pay to the order
of Citibank, N.A., as trustee, without recourse".
(B) The original Mortgage (including all riders thereto) with
evidence of recording thereon, or a copy thereof certified by the
public recording office in which such Mortgage has been recorded or, if
the original Mortgage has not been returned from the applicable public
recording office, a true certified copy, certified by the Seller, of
the original Mortgage together with a certificate of the Seller
certifying that the original Mortgage has been delivered for
26
recording in the appropriate public recording office of the
jurisdiction in which the Mortgaged Property is located.
(C) The original Assignment of Mortgage to "Citibank, N.A., as
trustee," which assignment shall be in form and substance acceptable
for recording, or a copy certified by the Seller as a true and correct
copy of the original Assignment of Mortgage which has been sent for
recordation. Subject to the foregoing, such assignments may, if
permitted by law, be by blanket assignments for Mortgage Loans covering
Mortgaged Properties situated within the same county. If the Assignment
of Mortgage is in blanket form, a copy of the Assignment of Mortgage
shall be included in the related individual Mortgage File.
(D) The original policy of title insurance, including riders
and endorsements thereto, or if the policy has not yet been issued, a
written commitment or interim binder or preliminary report of title
issued by the title insurance or escrow company.
(E) Originals of all recorded intervening Assignments of
Mortgage, or copies thereof, certified by the public recording office
in which such Assignments or Mortgage have been recorded showing a
complete chain of title from the originator to the Depositor, with
evidence of recording, thereon, or a copy thereof certified by the
public recording office in which such Assignment of Mortgage has been
recorded or, if the original Assignment of Mortgage has not been
returned from the applicable public recording office, a true certified
copy, certified by the Seller of the original Assignment of Mortgage
together with a certificate of the Seller certifying that the original
Assignment of Mortgage has been delivered for recording in the
appropriate public recording office of the jurisdiction in which the
Mortgaged Property is located.
(F) Originals, or copies thereof certified by the public
recording office in which such documents have been recorded, of each
assumption, extension, modification, written assurance or substitution
agreements, if applicable, or if the original of such document has not
been returned from the applicable public recording office, a true
certified copy, certified by the Seller, of such original document
together with certificate of Seller certifying the original of such
document has been delivered for recording in the appropriate recording
office of the jurisdiction in which the Mortgaged Property is located.
(G) If the Mortgage Note or Mortgage or any other material
document or instrument relating to the Mortgage Loan has been signed by
a person on behalf of the Mortgagor, the original power of attorney or
other instrument that authorized and empowered such person to sign
bearing evidence that such instrument has been recorded, if so required
in the appropriate jurisdiction where the Mortgaged Property is located
(or, in lieu thereof, a duplicate or conformed copy of such instrument,
together with a certificate of receipt from the recording office,
certifying that such copy represents a true and complete copy of the
original and that such original has been or is currently submitted to
be recorded in the appropriate governmental recording office of the
jurisdiction where the Mortgaged Property is located), or if the
original power of attorney or other such instrument has been delivered
for recording in the appropriate public recording office of the
jurisdiction in which the Mortgaged Property is located.
(ii) With respect to each Co-op Loan:
27
(A)(I) The original Mortgage Note (or a lost note affidavit
(including a copy of the original Mortgage Note)) or (II) original
consolidation, extension and modification agreement (or a lost note
affidavit (including a copy of the original consolidation, extension
and modification agreement)), in either case endorsed "Pay to the order
of Citibank, N.A., as trustee, without recourse."
(B) The original Mortgage entered into by the Mortgagor with
respect to such Co-Op Loan.
(C) The original Assignment of Mortgage to "Citibank, N.A. as
trustee".
(D) Original assignments of Mortgage showing a complete chain
of assignment from the originator of the related Co-Op Loan to the
Seller.
(E) Original Form UCC-1 and any continuation statements with
evidence of filing thereon entered into by the Mortgagor with respect
to such Co-Op Loan.
(F) Form UCC-3 (or copy thereof) by the applicable Mortgage
Loan Seller or its agent assigning the security interest covered by
such Form UCC-1 to "Citibank, N.A. as trustee", together with all Forms
UCC-3 (or copies thereof) showing a complete chain of assignment from
the originator of the related Co-op Loan to the Seller, with evidence
of recording thereon.
(G) Stock certificate representing the stock allocated to the
related dwelling unit in the related residential cooperative housing
corporation and pledged by the related Mortgagor to the originator of
such Co-op Loan with a stock power in blank attached.
(H) Original proprietary lease.
(I) Original assignment of proprietary lease, to the Trustee,
and all intervening assignments thereof.
(J) Original recognition agreement of the interests of the
mortgagee with respect to the Co-op Loan by the residential cooperative
housing corporation, the stock of which was pledged by the related
Mortgagor to the originator of such Co-op Loan.
(K) Originals of any assumption, consolidation or modification
agreements relating to any of the items specified in (A) through (F)
above with respect to such Co-op Loan.
If in connection with any Mortgage Loan which is not a Co-op
Loan the Depositor cannot deliver the Mortgage, Assignments of Mortgage, or
assumption, consolidation or modification agreement, as the case may be, with
evidence of recording thereon concurrently with the execution and delivery of
this Agreement solely because of a delay caused by the public recording office
where such Mortgage, Assignments of Mortgage, or assumption, consolidation or
modification agreement, as the case may be, has been delivered for recordation,
the Depositor shall deliver or cause to be delivered to the Trustee written
notice stating that such Mortgage, Assignments of Mortgage, or assumption,
consolidation or modification agreement, as the case may be, has been delivered
to the appropriate public recording office for recordation. Thereafter, the
Depositor shall deliver or cause to be delivered to the
28
Trustee such Mortgage, Assignments of Mortgage, or assumption, consolidation or
modification agreement, as the case may be, with evidence of recording indicated
thereon upon receipt thereof from the public recording office.
With respect to any Mortgage Loans which are not Co-op Loans,
and as to which the related Mortgaged Property is located in Florida or
Tennessee, the Servicer shall cause to be recorded in the appropriate public
recording office for real property records each Assignment of Mortgage referred
to in this Section 2.01 as soon as practicable. With respect to any Mortgage
Loans which are not Co-op Loans as to which the related Mortgaged Property is
located outside of Florida or Tennessee, the Servicer shall not be obligated to
cause to be recorded the Assignment of Mortgage referred to in this Section
2.01. With respect to Co-op Loans as to which the related dwelling unit is
located in Florida or Tennessee, the Servicer shall cause to be filed in the
appropriate filing office the Form UCC-3 referred to in this Section 2.01 as
soon as practicable. With respect to any Co-op Loans as to which the related
dwelling unit is located outside Florida or Tennessee, the Servicer shall not be
obligated to cause to be filed the Form UCC-3 referred to in this Section 2.01.
While each such Assignment of Mortgage or Form UCC-3 is being recorded or filed,
as applicable, the Servicer shall deliver to the Trustee a photocopy of such
document. If any such Assignment of Mortgage or Form UCC-3 is returned
unrecorded or unfiled to the Servicer because of any defect therein, the
Servicer shall cause such defect to be cured and such document to be recorded or
filed in accordance with this paragraph. The Depositor shall deliver or cause to
be delivered each such original recorded or filed Assignment of Mortgage and
intermediate assignment or Form UCC-3 to the Trustee within 270 days of the
Closing Date or shall deliver to the Trustee on or before such date an Officer's
Certificate stating that such document has been delivered to the appropriate
public recording or filing office for recording or filing, but has not been
returned solely because of a delay caused by such recording or filing office. In
any event, the Depositor shall use all reasonable efforts to cause each such
document with evidence of recording or filing thereon to be delivered to the
Trustee within 300 days of the Closing Date.
The ownership of each Mortgage Note, the Mortgage and the
contents of the related Mortgage File is vested in the Trustee. Neither the
Depositor nor the Servicer shall take any action inconsistent with such
ownership and shall not claim any ownership interest therein. The Depositor and
the Servicer shall respond to any third party inquiries with respect to
ownership of the Mortgage Loans by stating that such ownership is held by the
Trustee on behalf of the Certificateholders. Mortgage documents relating to the
Mortgage Loans not delivered to the Trustee are and shall be held in trust by
the Servicer or any Sub-Servicer, for the benefit of the Trustee as the owner
thereof, and the Servicer's or such Sub-Servicer's possession of the contents of
each Mortgage File so retained is for the sole purpose of servicing the related
Mortgage Loan, and such retention and possession by the Servicer or such Sub-
Servicer is in a custodial capacity only. The Depositor agrees to take no action
inconsistent with the Trustee's ownership of the Mortgage Loans, to promptly
indicate to all inquiring parties that the Mortgage Loans have been sold and to
claim no ownership interest in the Mortgage Loans. Each Mortgage File and the
mortgage documents relating to the Mortgage Loans contain proprietary business
information of the Servicer and its customers. The Trustee and the Depositor
agree that they will not use such information for business purposes without the
express written consent of the Servicer and that all such information shall be
kept strictly confidential.
It is the intention of this Agreement that the conveyance of
the Depositor's right, title and interest in and to the Trust Fund pursuant to
this Agreement shall constitute a purchase and sale and not a loan. If a
conveyance of Mortgage Loans from the Seller to the Depositor is characterized
as a pledge
29
and not a sale, then the Depositor shall be deemed to have transferred to the
Trustee all of the Depositor's right, title and interest in, to and under the
obligations of the Seller deemed to be secured by said pledge; and it is the
intention of this Agreement that the Depositor shall also be deemed to have
granted to the Trustee a first priority security interest in all of the
Depositor's right, title, and interest in, to and under the obligations of the
Seller to the Depositor deemed to be secured by said pledge and that the Trustee
shall be deemed to be an independent custodian for purposes of perfection of the
security interest granted to the Depositor. If the conveyance of the Mortgage
Loans from the Depositor to the Trustee is characterized as a pledge, it is the
intention of this Agreement that this Agreement shall constitute a security
agreement under applicable law, and that the Depositor shall be deemed to have
granted to the Trustee a first priority security interest in all of the
Depositor's right, title and interest in, to and under the Mortgage Loans, all
payments of principal of or interest on such Mortgage Loans, all other rights
relating to and payments made in respect of the Trust Fund, and all proceeds of
any thereof. If the trust created by this Agreement terminates prior to the
satisfaction of the claims of any Person in any Certificates, the security
interest created hereby shall continue in full force and effect and the Trustee
shall be deemed to be the collateral agent for the benefit of such Person.
In addition to the conveyance made in the first paragraph of
this Section 2.01, the Depositor does hereby convey, assign and set over to the
Trustee all of its right, title and interest in that portion of the Trust Fund
described in items (ii), (iii), (iv) and (v) of the definition thereof and
further assigns to the Trustee for the benefit of the Certificateholders those
representations and warranties of the Seller contained in the Sale Agreement and
described in Section 3.01 hereof and the benefit of the repurchase obligations
of the Seller described in Sections 2.02 and 3.01 hereof and the obligations of
the Seller contained in the Sale Agreement to take, at the request of the
Depositor or the Trustee, all action on its part which is reasonably necessary
to ensure the enforceability of a Mortgage Loan.
Section 2.02. Acceptance by Trustee. Except as set forth in
the Exception Report delivered contemporaneously herewith (the "Exception
Report"), the Trustee acknowledges receipt of the Mortgage Note for each
Mortgage Loan and delivery of a Mortgage File (but does not acknowledge receipt
of all documents required to be included in such Mortgage File) with respect to
each Mortgage Loan and declares that it holds and will hold such documents and
any other documents constituting a part of the Mortgage Files delivered to it in
trust for the use and benefit of all present and future Certificateholders. The
Depositor will cause the Seller to repurchase any Mortgage Loans to which an
exception was taken in the Exception Report unless such exception is cured to
the satisfaction of the Trustee within 45 Business Days of the Closing Date.
The Trustee agrees, for the benefit of Certificateholders, to
review each Mortgage File delivered to it within 270 days after the Closing Date
to ascertain that all documents required by Section 2.01 have been executed and
received, and that such documents relate to the Mortgage Loans identified in
Exhibit A that have been conveyed to it. If the Trustee finds any document or
documents constituting a part of a Mortgage File to be missing or defective
(that is, mutilated, damaged, defaced or unexecuted) in any material respect,
the Trustee shall promptly (and in any event within no more than five Business
Days) after such finding so notify the Servicer, the Seller and the Depositor.
In addition, the Trustee shall also notify the Servicer, the Seller and the
Depositor, if (a) in examining the Mortgage Files, the documentation shows on
its face (i) any adverse claim, lien or encumbrance, (ii) that any Mortgage Note
was overdue or had been dishonored, (iii) any evidence on the face of any
Mortgage Note or Mortgage of any security interest or other right or interest
therein, or (iv) any defense against or claim to the Mortgage Note by any party
or (b) the original Mortgage with evidence of recording thereon with respect to
a
30
Mortgage Loan is not received within 270 days of the Closing Date. The Trustee
shall request that the Seller correct or cure such omission, defect or other
irregularity, or substitute a Mortgage Loan pursuant to the provisions of
Section 3.03, within 60 days from the date the Seller was notified of such
omission or defect and, if the Seller does not correct or cure such omission or
defect within such period, that the Seller purchase such Mortgage Loan from the
Trustee within 90 days from the date the Trustee notified the Seller of such
omission, defect or other irregularity at the Purchase Price of such Mortgage
Loan. The Purchase Price for any Mortgage Loan purchased pursuant to this
Section 2.02 shall be paid to the Servicer and deposited by the Servicer in the
Collection Account promptly upon receipt, and, upon receipt by the Trustee of
written notification of such deposit signed by a Servicing Officer, the Trustee
shall promptly release to the Seller the related Mortgage File and the Trustee
shall execute and deliver such instruments of transfer or assignment, without
recourse, as shall be necessary to vest in the Seller or its designee, as the
case may be, any Mortgage Loan released pursuant hereto, and the Trustee shall
have no further responsibility with regard to such Mortgage Loan. It is
understood and agreed that the obligation of the Seller to purchase, cure or
substitute any Mortgage Loan as to which a material defect in or omission of a
constituent document exists shall constitute the sole remedy respecting such
defect or omission available to the Trustee on behalf of Certificateholders. The
Trustee shall be under no duty or obligation to inspect, review and examine such
documents, instruments, certificates or other papers to determine that they are
genuine, enforceable or appropriate to the represented purpose, or that they
have actually been recorded, or that they are other than what they purport to be
on their face. The Trustee shall keep confidential the name of each Mortgagor
and shall not solicit any such Mortgagor for the purpose of refinancing the
related Mortgage Loan.
Within 280 days of the Closing Date, the Trustee shall deliver
to the Depositor and the Servicer the Trustee's Certification, substantially in
the form of Exhibit G attached hereto, setting forth the status of the Mortgage
Files as of such date.
Section 2.03. Trust Fund; Authentication of Certificates. The
Trustee acknowledges and accepts the assignment to it of the Trust Fund created
pursuant to this Agreement in trust for the use and benefit of all present and
future Certificateholders. The Trustee acknowledges the assignment to it for the
benefit of the Trust Fund of the Mortgage Loans and has caused to be
authenticated and delivered to or upon the order of the Depositor, in exchange
for the Mortgage Loans, Certificates duly authenticated by the Trustee or, if an
Authenticating Agent has been appointed pursuant to Section 4.06, the
Authenticating Agent in authorized denominations evidencing ownership of the
entire Trust Fund.
Section 2.04. REMIC Election.
(a) The Depositor hereby instructs and authorizes the Trustee
to make an appropriate election to treat the Trust Fund as a REMIC. This
Agreement shall be construed so as to carry out the intention of the parties
that the Trust Fund be treated as a REMIC at all times prior to the date on
which the Trust Fund is terminated. The Closing Date is hereby designated as the
"startup day" of the REMIC within the meaning of Section 860G(a)(9) of the Code.
The "regular interests" (within the meaning of Section 860G(a)(1) of the Code)
in the REMIC shall consist of the Class A Certificates (other than the Class A-R
Certificate), the Class M Certificates and the Class B Certificates, and the
"residual interest" (within the meaning of Section 860G(a)(2) of the Code) in
the REMIC shall consist of the Residual Interest, and all such interests shall
be designated as such on the Startup Day. Solely for the purposes of Section
1.860G-1(a)(4)(iii) of the Treasury regulations, the "latest possible maturity
date" by which the Outstanding Certificate Principal Balance of each Class of
Certificates representing a regular
31
interest in the REMIC would be reduced to zero is the Distribution Date
immediately following the latest scheduled maturity of any Mortgage Loan.
(b) The "tax matters person" with respect to the Trust Fund
for purposes of the REMIC provisions shall be the beneficial owner of the Class
A-R Certificate; provided, however, that such beneficial owner of a Class A-R
Certificate, by its acceptance thereof, irrevocably appoints the Servicer as its
agent and attorney-in-fact to act as "tax matters person" with respect to the
Trust Fund for purposes of the REMIC provisions.
(c) It is intended that the Trust Fund shall constitute, and
that the affairs of the Trust Fund shall be conducted so as to qualify the Trust
Fund as, a "real estate mortgage investment conduit" as defined in and in
accordance with the REMIC Provisions. In furtherance of such intention, the
Servicer covenants and agrees that it shall act as agent (and the Servicer is
hereby appointed to act as agent) on behalf of the Trust Fund and the Holder of
the Class A-R Certificate and that in such capacity it shall:
(i) prepare and file, or cause to be prepared and
filed, in a timely manner, a U.S. Real Estate Mortgage Investment
Conduit Income Tax Return (Form 1066) and prepare and file or cause to
be prepared and filed with the Internal Revenue Service and applicable
state or local tax authorities income tax or information returns for
each taxable year with respect to the Trust Fund, using the calendar
year as the taxable year and the accrual method of accounting,
containing such information and at the times and in the manner as may
be required by the Code or state or local tax laws, regulations, or
rules, and shall furnish or cause to be furnished to Certificateholders
the schedules, statements or information at such times and in such
manner as may be required thereby;
(ii) within thirty days of the Closing Date, shall
furnish or cause to be furnished to the Internal Revenue Service, on
Form 8811 or as otherwise may be required by the Code, the name, title,
address, and telephone number of the person that the holders of the
Certificates may contact for tax information relating thereto (and the
Servicer shall act as the representative of the Trust Fund for this
purpose), together with such additional information as may be required
by such Form, and shall update such information at the time or times in
the manner required by the Code;
(iii) make or cause to be made an election, on behalf
of the Trust Fund, to be treated as a REMIC, and make the appropriate
designations, if applicable, in accordance with this Section 2.04 on
the federal tax return of the Trust Fund for its first taxable year
(and, if necessary, under applicable state law);
(iv) prepare and forward, or cause to be prepared and
forwarded, to the Certificateholders and to the Internal Revenue
Service and, if necessary, state tax authorities, all information
returns or reports, or furnish or cause to be furnished by telephone,
mail, publication or other appropriate method such information, as and
when required to be provided to them in accordance with the REMIC
Provisions, including without limitation, the calculation of any
original issue discount;
32
(v) provide information necessary for the computation
of tax imposed on the transfer of the Class A-R Certificate to a
Disqualified Organization, or an agent (including a broker, nominee or
other middleman) of a Disqualified Organization, or a pass-through
entity in which a Disqualified Organization is the record holder of an
interest (the reasonable cost of computing and furnishing such
information may be charged to the Person liable for such tax);
(vi) ensure that federal, state or local income tax
or information returns shall be signed by the Trustee or such other
person as may be required to sign such returns by the Code or state or
local laws, regulations or rules; and
(vii) maintain such records relating to the Trust
Fund, as may be required by the Code and, as may be necessary to
prepare the foregoing returns, schedules, statements or information.
[END OF ARTICLE II]
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE DEPOSITOR AND
THE SERVICER; REPURCHASE OF MORTGAGE LOANS
Section 3.01. Representations and Warranties of the Depositor
with respect to the Mortgage Loans.
The Depositor hereby represents and warrants to the Trustee
for the benefit of the Certificateholders that on the Closing Date it has
entered into the Sale Agreement with CMMC as Seller, that the Seller has made
the following representations and warranties with respect to each Mortgage Loan
in such Sale Agreement as of the Closing Date, which representations and
warranties run to and are for the benefit of the Depositor and the Trustee for
the benefit of the Certificateholders, and as to which the Depositor has
assigned to the Trustee for the benefit of the Certificateholders, pursuant to
Section 2.01 hereof, the right to cause the Seller to repurchase a Mortgage Loan
as to which there has occurred an uncured breach of representations and
warranties in accordance with the provisions of the Sale Agreement.
(a) The information set forth in the Mortgage Loan Schedule is
complete, true and correct in all material respects;
(b) With respect to a Mortgage Loan which is not a Co-op Loan,
the Mortgage creates a first lien or a first priority ownership interest in an
estate in fee simple in real property securing the related Mortgage Note. With
respect to a Co-op Loan, the related Mortgage is a valid, enforceable and
subsisting first security interest on the related cooperative shares securing
the related Mortgage Note, subject only to (a) liens of the related residential
cooperative housing corporation for unpaid assessments representing the
Mortgagor's pro rata share of the related residential cooperative housing
corporation's payments for its blanket mortgage, current and future real
property taxes, insurance premiums, maintenance fees and other assessments to
which like collateral is commonly subject and (b) other matters to which like
collateral is commonly subject which do not materially interfere with the
benefits of the security intended to be provided by the related security
agreement. There are no liens against or
33
security interest in the cooperative shares relating to each Co-op Loan (except
for unpaid maintenance, assessments and other amounts owed to the related
cooperative which individually or in the aggregate will not have a material
adverse effect on such Co-op Loan), which have priority over the Trustee's
security interest in such cooperative shares;
(c) All payments due prior to the Cut-off Date for such
Mortgage Loan have been made as of the Closing Date, the Mortgage Loan is not
delinquent in payment more than 30 days and has not been dishonored; to the best
of the Seller's knowledge, there are no material defaults under the terms of the
Mortgage Loan; the Seller has not advanced funds, or induced, solicited or
knowingly received any advance of funds from a party other than the owner of the
Mortgaged Property subject to the Mortgage (or, with respect to a Co-op Loan,
the related Mortgagor), directly or indirectly, for the payment of any amount
required by the Mortgage Loan; there has been no more than one delinquency in
excess of 30 days during the preceding twelve-month period;
(d) To the best of the Seller's knowledge, all taxes,
governmental assessments, insurance premiums, water, sewer and municipal
charges, leasehold payments or ground rents which previously became due and
owing have been paid, or escrow funds have been established in an amount
sufficient to pay for every such escrowed item which remains unpaid and which
has been assessed but is not yet due and payable;
(e) The terms of the Mortgage Note and the Mortgage have not
been impaired, waived, altered or modified in any respect, except by written
instruments. No Mortgagor has been released, in whole or in part, from the terms
thereof except in connection with an assumption agreement and which assumption
agreement is part of the Mortgage File and the terms of which are reflected in
the Mortgage Loan Schedule;
(f) The Mortgage Note and the Mortgage are not subject to any
right of rescission, set-off, counterclaim or defense, including, without
limitation, the defense of usury, nor will the operation of any of the terms of
the Mortgage Note or Mortgage, or the exercise of any right thereunder, render
the Mortgage Note or Mortgage unenforceable, in whole or in part, or subject to
any right of rescission, set-off, counterclaim or defense, including the defense
of usury, and no such right of rescission, set-off, counterclaim or defense has
been asserted with respect thereto, and the Mortgagor was not a debtor in any
state or federal bankruptcy or insolvency proceeding at the time the Mortgage
Loan was originated;
(g) With respect to a Mortgage Loan which is not a Co-op Loan,
all buildings or other customarily insured improvements upon the Mortgaged
Property are insured by an insurer acceptable under the FNMA Guides against loss
by fire, hazards of extended coverage and such other hazards as are provided for
in the FNMA Guides or by FHLMC. All such standard hazard policies are in full
force and effect and on the date of origination contained a standard mortgagee
clause naming the Seller and its successors in interest and assigns as loss
payee and such clause is still in effect and all premiums due thereon have been
paid. If required by the Flood Disaster Protection Act of 1973, as amended, the
Mortgaged Property is covered by a flood insurance policy meeting the
requirements of the current guidelines of the Federal Insurance Administration
which policy conforms to FNMA and FHLMC requirements. The Mortgage obligates the
Mortgagor thereunder to maintain all such insurance at the Mortgagor's cost and
expense, and on the Mortgagor's failure to do so, authorizes the holder of the
34
Mortgage to maintain such insurance at the Mortgagor's cost and expense and to
seek reimbursement therefor from the Mortgagor;
(h) Any and all requirements of any federal, state or local
law including, without limitation, usury, truth-in-lending, real estate
settlement procedures, consumer credit protection, equal credit opportunity or
disclosure laws applicable to the Mortgage Loan have been complied with in all
material respects;
(i) The Mortgage has not been satisfied, canceled or
subordinated, in whole or in part, or rescinded, and the Mortgaged Property has
not been released from the lien of the Mortgage, in whole or in part nor has any
instrument been executed that would effect any such release, cancellation,
subordination or rescission;
(j) With respect to a Mortgage Loan which is not a Co-op Loan,
the Mortgage is a valid, subsisting, enforceable and perfected first lien on the
Mortgaged Property, including, all buildings on the Mortgaged Property and all
installations and mechanical, electrical, plumbing, heating and air conditioning
systems affixed to such buildings, and all additions, alterations and
replacements made at any time with respect to the foregoing securing the
Mortgage Note's original principal balance. The Mortgage and the Mortgage Note
do not contain any evidence of any security interest or other interest or right
thereto. Such lien is free and clear of all adverse claims, liens and
encumbrances having priority over the first lien of the Mortgage subject only to
(1) the lien of non-delinquent current real property taxes and assessments not
yet due and payable, (2) covenants, conditions and restrictions, rights of way,
easements and other matters of the public record as of the date of recording
which are acceptable to mortgage lending institutions generally and either (A)
which are referred to or otherwise considered in the appraisal made for the
originator of the Mortgage Loan, or (B) which do not adversely affect the
Appraised Value of the Mortgaged Property as set forth in such appraisal, and
(3) other matters to which like properties are commonly subject which do not
materially interfere with the benefits of the security intended to be provided
by the Mortgage or the use, enjoyment, value or marketability of the related
Mortgaged Property. Any security agreement, chattel mortgage or equivalent
document related to and delivered in connection with the Mortgage Loan
establishes and creates a valid, subsisting, enforceable and perfected first
lien and first priority security interest on the property described therein, and
the Depositor has the full right to sell and assign the same to the Trustee for
the benefit of the Certificateholders;
(k) The Mortgage Note and the related Mortgage are original
and genuine and each is the legal, valid and binding obligation of the maker
thereof, enforceable in all respects in accordance with its terms subject to
bankruptcy, insolvency and other laws of general application affecting the
rights of creditors and the Depositor has taken all action necessary to transfer
such rights of enforceability to the Trustee for the benefit of the
Certificateholders. All parties to the Mortgage Note and the Mortgage had the
legal capacity to enter into the Mortgage Loan and to execute and deliver the
Mortgage Note and the Mortgage. The Mortgage Note and the Mortgage have been
duly and property executed by such parties. The proceeds of the Mortgage Loan
have been fully disbursed and there is no requirement for future advances
thereunder, and any and all requirements as to completion of any on-site or
off-site improvements and as to disbursements of any escrow funds therefor have
been complied with;
(1) The Depositor is the sole owner of record and holder of
the Mortgage Loan and the indebtedness evidenced by the Mortgage Note, except
for the Assignments of Mortgage which have
35
been sent for recording, and upon recordation the Depositor will be the owner of
record of the Mortgage and the indebtedness evidenced by the Mortgage Note, and
upon the sale of the Mortgage Loan to the Trust for the benefit of the
Certificateholders, the Depositor will retain the Mortgage File or any part
thereof with respect thereto not delivered to the Trust for the benefit of the
Certificateholders or its designee in trust only for the purpose of servicing
and supervising the servicing of the Mortgage Loan. Immediately prior to the
transfer and assignment to the Trust for the benefit of the Certificateholders,
the Mortgage Loan, including the Mortgage Note and the Mortgage, were not
subject to an assignment or pledge, and the Depositor had good and marketable
title to and was the sole owner thereof and had full right to transfer and sell
the Mortgage Loan to the Trustee for the benefit of the Certificateholders free
and clear of any encumbrance, equity, lien, pledge, charge, claim or security
interest and has the full right and authority subject to no interest or
participation of, or agreement with, any other party, to sell and assign the
Mortgage Loan pursuant to this Agreement and following the sale of the Mortgage
Loan, the Trustee for the benefit of the Certificateholders will own such
Mortgage Loan free and clear of any encumbrance, equity, participation interest,
lien, pledge, charge, claim or security interest;
(m) With respect to a Mortgage Loan which is not a Co-op Loan,
the Mortgage Loan is covered by an ALTA lender's title insurance policy or other
generally acceptable form of policy or insurance acceptable to FNMA or FHLMC,
issued by a title insurer acceptable to FNMA or FHLMC and qualified to do
business in the jurisdiction where the Mortgaged Property is located, insuring
(subject to the exceptions contained in (j) (1), (2) and (3) above) the Seller,
its successors and assigns, as to the first priority lien of the Mortgage in the
original principal amount of the Mortgage Loan. Such lender's title insurance
policy insures ingress and egress by or upon the Mortgaged Property or any
interest therein. Where required by state law or regulation, the Mortgagor has
been given the opportunity to choose the carrier of the required mortgage title
insurance. The Seller, its successors and assigns, are the sole insureds of such
lender's title insurance policy, such title insurance policy has been duly and
validly endorsed to the Trustee for the benefit of the Certificateholders or the
assignment to the Trustee for the benefit of the Certificateholders of the
Seller's interest therein does not require the consent of or notification to the
insurer and such lender's title insurance policy is in full force and effect and
will be in full force and effect upon the consummation of the transactions
contemplated by this Agreement. No claims have been made under such lender's
title insurance policy, and no prior holder of the related Mortgage, including
the Seller, has done, by act or omission, anything which would impair the
coverage of such lender's title insurance policy;
(n) There is no default, breach, violation or event of
acceleration existent, under the Mortgage or the related Mortgage Note and no
event which, with the passage of time or with notice and the expiration of any
grace or cure period, would constitute a default, breach, violation or event
permitting acceleration; and neither the Seller nor any prior mortgagee has
waived any default, breach, violation or event permitting acceleration;
(o) There are no mechanics', or similar liens or claims which
have been filed for work, labor or material (and no rights are outstanding that
under law could give rise to such liens) affecting the related Mortgaged
Property which are or may be liens prior to or equal to the lien of the related
Mortgage;
(p) With respect to a Mortgage Loan which is not a Co-op Loan,
all improvements subject to the Mortgage which were considered in determining
the Appraised Value of the Mortgaged Property lie wholly within the boundaries
and building restriction lines of the Mortgaged Property (and
36
wholly within the project with respect to a condominium unit) and no
improvements on adjoining properties encroach upon the Mortgaged Property except
those which are insured against by the title insurance policy referred to in
clause (m) above and all improvements on the property comply with all applicable
zoning and subdivision laws and ordinances; the Mortgaged Property is lawfully
occupied under applicable law;
(q) The Mortgage Loan complies in all material respects with
all the terms, conditions and requirements of the Seller's underwriting
standards in effect at the time of origination of such Mortgage Loan. The
Mortgage Notes and Mortgages (exclusive of any riders) are on forms generally
acceptable to FNMA or FHLMC. Monthly Payments under the Mortgage Note are due
and payable on the first day of each month. The Mortgage contains the usual and
enforceable provisions of the originator at the time of origination for the
acceleration of the payment of the unpaid principal amount of the Mortgage Loan
if the related Mortgaged Property is sold without the prior consent of the
mortgagee thereunder;
(r) To the best of the Seller's knowledge, the Mortgaged
Property (or Underlying Mortgaged Property, in the case of a Co-op Loan), is not
subject to any material damage by waste, fire, earthquake, windstorm, flood or
other casualty. To the best of the Seller's knowledge, at origination of the
Mortgage Loan there was, and there currently is, no proceeding pending for the
total or partial condemnation of the Mortgaged Property (or Underlying Mortgaged
Property, in the case of a Co-op Loan);
(s) The related Mortgage contains customary and enforceable
provisions such as to render the rights and remedies of the holder thereof
adequate for the realization against the Mortgaged Property of the benefits of
the security provided thereby, including, (l) in the case of a Mortgage
designated as a deed of trust, by trustee's sale, and (2) otherwise by judicial
foreclosure. There is no homestead or other exemption available to the Mortgagor
which would interfere with the right to sell the Mortgaged Property at a
trustee's sale or the right to foreclose the Mortgage;
(t) If the Mortgage constitutes a deed of trust, a trustee,
authorized and duly qualified if required under applicable law to act as such,
has been properly designated and currently so serves and is named in the
Mortgage, and no fees or expenses, except as may be required by local law, are
or will become payable by the Purchaser to the trustee under the deed of trust,
except in connection with a trustee's sale or attempted sale after default by
the Mortgagor;
(u) The Mortgage File contains an appraisal of the related
Mortgaged Property (or the related residential dwelling unit in the Underlying
Mortgaged Property, in the case of a Co-op Loan), signed prior to the final
approval of the mortgage loan application by an appraiser approved by the Seller
who had no interest, direct or indirect, in the Mortgaged Property (or
Underlying Mortgaged Property, in the case of a Co-op Loan), or in any loan made
on the security thereof, and whose compensation is not affected by the approval
or disapproval of the Mortgage Loan. The appraisal is in a form acceptable to
FNMA or FHLMC;
(v) All parties which have had any interest in the Mortgage,
whether as mortgagee, assignee, pledgee or otherwise, are (or, during the period
in which they held and disposed of such interest, were) (A) in substantial
compliance with any and all applicable licensing requirements of the laws of the
state wherein the Mortgaged Property (or Underlying Mortgaged Property, in the
case of a
37
Co-op Loan), is located, and (B) (1) organized under the laws of such state, or
(2) qualified to do business in such state, or (3) federal savings and loan
associations or national banks or a Federal Home Loan Bank or savings bank
having principal offices in such state, or (4) not doing business in such state;
(w) The related Mortgage Note is not and has not been secured
by any collateral except the lien of the corresponding Mortgage and the security
interest of any applicable security interest of any applicable agreement or
chattel mortgage referred to above and such collateral does not serve as
security for any other obligation;
(x) The Mortgagor has received all disclosure materials
required by applicable law with respect to the making of such mortgage loans;
(y) The Mortgage Loan does not contain "graduated payment"
features;
(z) The Mortgagor is not in bankruptcy and, to the best of the
Seller's knowledge, the Mortgagor is not insolvent;
(aa) The Mortgage Loans are fixed rate mortgage loans. Each
Mortgage Loan has an original term to maturity of not more than thirty (30)
years, with interest payable in arrears on the first day of each month. Each
Mortgage Note is payable in equal monthly installments of principal and interest
which are sufficient to amortize the Mortgage Loan fully by the stated maturity
date. No Mortgage Loan contains terms or provisions which would result in
negative amortization;
(bb) Each Mortgage Note, each Mortgage, each Assignment of
Mortgage and any other documents required pursuant to this Agreement to be
delivered to the Trustee on behalf of the Certificateholders or its designee, or
its assignee for each Mortgage Loan, have been, on or before the Closing Date,
delivered to the Trustee on behalf of the Certificateholders or its designee, or
its assignee;
(cc) All escrow payments have been collected in full
compliance with state and federal law and the provisions of the related Mortgage
Note and Mortgage. As to any Mortgage Loan that is the subject of an escrow,
escrow of funds is not prohibited by applicable law and has been established in
an amount sufficient to pay for every escrowed item that remains unpaid and has
been assessed but is not yet due and payable. No escrow deposits or other
charges or payments due under the Mortgage Note have been capitalized under any
Mortgage or the related Mortgage Note. Any interest required to be paid pursuant
to state, federal and local law has been properly paid and credited;
(dd) [Reserved];
(ee) In the event the Mortgage Loan has a Loan-to-Value Ratio
greater than 80%, the excess of the principal balance of the Mortgage Loan over
75% of the Appraised Value, with respect to a refinanced Mortgage Loan, or the
lesser of the Appraised Value or the purchase price of the Mortgaged Property
(or Underlying Mortgaged Property, in the case of a Co-op Loan), with respect to
a purchase money Mortgage Loan, is and will be insured as to payment defaults by
a Primary Insurance Policy issued by a Qualified Insurer. All provisions of such
Primary Insurance Policy have been and are being complied with, such policy is
in full force and effect, and all premiums due thereunder have been paid. No
action, inaction, or event has occurred and no state of facts exists that has,
or will result in the exclusion from, denial of, or defense to coverage. Any
Mortgage Loan subject to a Primary Insurance
38
Policy obligates the Mortgagor thereunder to maintain the Primary Insurance
Policy and to pay all premiums and charges in connection therewith. The Mortgage
Rate for the Mortgage Loan as set forth on the Mortgage Loan Schedule is net of
any such insurance premium;
(ff) The Assignment of Mortgage is in recordable form and is
acceptable for recording (or, in the case of a Co-op Loan, is in a form
acceptable for filing) under the laws of the jurisdiction in which the Mortgaged
Property (or underlying Mortgaged Property, in the case of a Co-op Loan) is
located;
(gg) As to Mortgage Loans that are not secured by an interest
in a leasehold estate, the Mortgaged Property (or Underlying Mortgaged Property,
in the case of a Co-op Loan), is located in the state identified in the Mortgage
Loan Schedule and consists of a single parcel of real property with a detached
single family residence erected thereon, or a two-to four-family dwelling, or an
individual condominium unit in a condominium project, or a dwelling unit in a
residential cooperative housing corporation or an individual unit in an attached
planned unit development or a detached planned unit development, provided,
however, that no residence or dwelling is a single parcel of real property with
a mobile home thereon. As of the date of origination, no portion of the
Mortgaged Property (or Underlying Mortgaged Property, in the case of a Co-op
Loan), was used for commercial purposes, and since the date of origination, to
the best of the Seller's knowledge, no portion of the Mortgaged Property (or
Underlying Mortgaged Property, in the case of a Co-op Loan), is used for
commercial purposes;
(hh) If the Mortgaged Property is a condominium unit or a
planned unit development (other than a de minimis planned unit development), as
of the date of origination of the related Mortgage Loan, such condominium or
planned unit development project met the Seller's eligibility requirements, as
set forth in the Seller's underwriting guidelines as of such date; in the case
of each Co-op Loan, the related residential cooperative housing corporation
complied in all material respects with the Seller's requirements as set forth in
the Seller's underwriting guidelines as of such date;
(ii) To the best of the Seller's knowledge, there is no
pending action or proceeding directly involving the Mortgaged Property (or
Underlying Mortgaged Property, in the case of a Co-op Loan), in which compliance
with any environmental law, rule or regulation is an issue;
(jj) The Mortgagor has not notified the Seller, and the
Depositor has no knowledge of any relief requested or allowed to the Mortgagor
under the Soldiers' and Sailors' Civil Relief Act of 1940, as amended;
(kk) No Mortgage Loan was made in connection with the
construction or rehabilitation of a Mortgaged Property (or Underlying Mortgaged
Property, in the case of a Co-op Loan), or facilitating the trade-in or exchange
of a Mortgaged Property (or Underlying Mortgaged Property, in the case of a
Co-op Loan);
(ll) No action has been taken or failed to be taken by
Depositor, on or prior to the Closing Date, which has resulted or will result in
an exclusion from, denial of, or defense to coverage under any Primary Insurance
Policy (including, without limitation, any exclusions, denials or defenses which
would limit or reduce the availability of the timely payment of the full amount
of the loss otherwise due thereunder to the insured) whether arising out of
actions, representations, errors, omissions, negligence, or fraud of the
Depositor, or for any other reason under such coverage;
39
(mm) The Mortgage Loan was originated by a mortgagee approved
by the Secretary of Housing and Urban Development pursuant to Sections 203 and
211 of the National Housing Act, as amended, a savings and loan association, a
savings bank, a commercial bank, credit union, insurance company or similar
institution which is supervised and examined by a federal or state authority;
(nn) Principal payments on the Mortgage Loan commenced no more
than sixty (60) days after funds were disbursed in connection with the Mortgage
Loan. The Mortgage Note is payable on the first day of each month in equal
monthly installments of principal and interest, with interest calculated and
payable in arrears, sufficient to amortize the Mortgage Loan fully by the stated
maturity date, over an original term of not more than thirty years from
commencement of amortization;
(oo) The Mortgage Loan is a "qualified mortgage" within the
meaning of Section 860G(a)(3) of the Code (without regard to Treasury
Regulations ss. 1.860G-2(f) or any similar rule that provides that a defective
obligation is a qualified mortgage for a temporary period); and
(pp) With respect to a Mortgage Loan that is a Co-op Loan, the
stock that is pledged as security for the Mortgage Loan is held by a person as a
tenant-stockholder (as defined in Section 216 of the Code) in a cooperative
housing corporation (as defined in Section 216 of the Code).
Upon discovery by any of the Depositor, the Servicer or the
Trustee of a breach of any of the foregoing representations and warranties which
materially and adversely affects the value of a Mortgage Loan or the interest of
the Certificateholders (or which materially and adversely affects the interests
of the Certificateholders in the related Mortgage Loan in the case of a
representation and warranty relating to a particular Mortgage Loan), the party
discovering such breach shall give prompt written notice to the other parties
and to the Seller, which notice shall specify the date of discovery. Pursuant to
the Sale Agreement, the Seller shall within 90 days from the earlier of (i) the
date specified in the notice as the date of discovery of such breach or (ii) the
date the Seller otherwise discovers such breach, cure such breach, substitute a
Mortgage Loan pursuant to the provisions of Section 3.03 or, if the breach
relates to a particular Mortgage Loan, purchase such Mortgage Loan from the
Trustee at the Purchase Price. The Purchase Price for the purchased Mortgage
Loan shall be paid to the Servicer and shall be deposited by the Servicer in the
Collection Account promptly upon receipt, and, upon receipt by the Trustee of
written notification of such deposit signed by a Servicing Officer, the Trustee
shall promptly release to the Seller the related Mortgage File, and the Trustee
shall execute and deliver such instruments of transfer or assignment as may be
provided to it by the Servicer, without recourse, as shall be necessary to vest
in the Seller or its designee, as the case may be, any Mortgage Loan released
pursuant hereto, and the Trustee shall have no further responsibility with
regard to such Mortgage Loan. It is understood and agreed that the obligation of
the Seller to cure, substitute or purchase any Mortgage Loan as to which such a
breach has occurred shall constitute the sole remedy respecting such breach
available to Certificateholders or the Trustee on behalf of Certificateholders.
Section 3.02. Representations and Warranties of the Servicer.
The Servicer represents and warrants to, and covenants with, the Trustee for the
benefit of the Certificateholders that as of the Closing Date:
(a) The Servicer is a corporation duly chartered and validly
existing in good standing under the laws of the State of New Jersey,
and the Servicer is duly qualified or
40
registered as a foreign corporation in good standing in each
jurisdiction in which the ownership or lease or its properties or the
conduct of its business requires such qualification;
(b) The execution and delivery of this Agreement by the
Servicer and its performance and compliance with the terms of this
Agreement will not violate the Servicer's corporate charter or by-laws
or constitute a default (or an event which, with notice or lapse of
time, or both, would constitute a default) under, or result in the
breach of, any material contract, agreement or other instrument to
which the Servicer is a party or which may be applicable to the
Servicer or any of its assets;
(c) This Agreement, assuming due authorization, execution and
delivery by the Trustee and the Depositor, constitutes a valid, legal
and binding obligation of the Servicer, enforceable against it in
accordance with the terms hereof subject to applicable bankruptcy,
insolvency, reorganization, moratorium and other laws affecting the
enforcement of creditors' rights generally and to general principles of
equity, regardless of whether such enforcement is considered in a
proceeding in equity or at law;
(d) The Servicer is not in default with respect to any order
or decree of any court or any order, regulation or demand of any
federal, state, municipal or governmental agency, which default might
have consequences that would materially and adversely affect the
condition (financial or other) or operations of the Servicer or its
properties or might have consequences that would affect its performance
hereunder; and
(e) No litigation is pending or, to the best of the Servicer's
knowledge, threatened against the Servicer which would prohibit its
entering into this Agreement or performing its obligations under this
Agreement.
It is understood and agreed that the representations and
warranties set forth in this Section 3.02 shall survive the issuance and
delivery of the Certificates and shall be continuing as long as any Certificate
shall be outstanding or this Agreement has been terminated.
Section 3.03. Option to Substitute. If the Seller is required
to repurchase any Mortgage Loan pursuant to Section 2.02 or 3.01, the Seller
may, at its option, within two years from the Closing Date, remove such
defective Mortgage Loan from the terms of this Agreement and substitute another
mortgage loan for such defective Mortgage Loan, in lieu of repurchasing such
defective Mortgage Loan. Any substitute Mortgage Loan shall (a) have a Principal
Balance at the time of substitution not in excess of the Principal Balance of
the removed Mortgage Loan (the amount of any difference, plus one month's
interest thereon at the Mortgage Rate borne by the removed Mortgage Loan, being
paid by the Seller and deemed to be a Principal Prepayment to be deposited by
the Servicer in the Collection Account), (b) have a Mortgage Rate not less than,
and not more than one percentage point greater than, the Mortgage Rate of the
removed Mortgage Loan (provided, however, that if the Mortgage Rate on the
substitute Mortgage Loan exceeds the Mortgage Rate on the removed Mortgage Loan,
the amount of that excess interest (the "Substitute Excess Interest") shall be
payable to the Residual Interest), (c) have a remaining term to stated maturity
not later than, and not more than one year less than, the remaining term to
stated maturity of the removed Mortgage Loan, (d) be, in the reasonable
determination of the Servicer, of the same type, quality and character
(including location of the Mortgaged Property (or Underlying Mortgaged Property,
in the case of a Co-op Loan)) as the removed Mortgage Loan as if the
41
breach had not occurred, (e) have a Loan-to-Value Ratio at origination no
greater than that of the removed Mortgage Loan and (f) be, in the reasonable
determination of the Servicer, in material compliance with the representations
and warranties contained in the Sale Agreement and described in Section 3.01, as
of the date of substitution.
The Servicer shall amend the Mortgage Loan Schedule to reflect
the withdrawal of the removed Mortgage Loan from this Agreement and the
substitution of such substitute Mortgage Loan therefor and shall send a copy of
such amended Mortgage Loan Schedule to the Trustee. The Sale Agreement provides
that upon such amendment the Seller shall be deemed to have made as to such
substitute Mortgage Loan the representations and warranties set forth in Section
3.01 as of the date of such substitution, which shall be continuing as long as
any Certificate shall be outstanding or this Agreement has not been terminated,
and the remedies for breach of any such representation or warranty shall be as
set forth in Section 3.01. Upon such amendment, the Trustee shall review the
Mortgage File delivered to it relating to the substitute Mortgage Loan, within
the time and in the manner and with the remedies specified in Section 2.02,
except that for purposes of this Section 3.03 (other than the two-year period
specified in the first sentence of this Section), such time shall be measured
from the date of the applicable substitution. In the event of such a
substitution, accrued interest on the substitute Mortgage Loan for the month in
which the substitution occurs and any Principal Prepayments made thereon during
such month shall be the property of the Trust Fund, and accrued interest for
such month on the Mortgage Loan for which the substitution is made and any
Principal Prepayments made thereon during such month shall be the property of
the Seller. The principal payment on a substitute Mortgage Loan due on the Due
Date in the month of substitution shall be the property of the Seller, and the
principal payment on the Mortgage Loan for which the substitution is made due on
such date shall be the property of the Trust Fund.
[END OF ARTICLE III]
ARTICLE IV
THE CERTIFICATES
Section 4.01. The Certificates. (a) The Class A, Class M and
Class B Certificates shall be substantially in the forms thereof included within
Exhibits C, D, E and F and shall, on original issue, be executed by the
Depositor and authenticated by the Trustee (or, if an Authenticating Agent has
been appointed pursuant to Section 4.06, the Authenticating Agent) upon receipt
by the Trustee of the documents specified in Section 2.01, delivered to or upon
the order of the Depositor.
(b) The Depository, the Depositor, the Paying Agent and the
Trustee have entered into a Depository Agreement dated as of January 26, 2001
(the "Depository Agreement"). 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 the Book-Entry
Certificates may not be transferred as provided in Section 4.02 except to a
successor to the Depository; (ii) ownership and transfers of registration of the
Book-Entry Certificates on the books of the Depository shall be governed by
applicable rules established by the Depository; (iii) the Depository may collect
its usual and customary fees, charges and expenses from its Depository
Participants; (iv) the Trustee shall deal with the Depository, Depository
Participants and Indirect Participants as representatives of the Certificate
Owners of the Book-Entry Certificates for purposes of exercising the rights of
such Holders under this
42
Agreement, and requests and directions for and votes of such representatives
shall not be deemed to be inconsistent if they are made with respect to
different Certificate Owners; and (v) 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 Participants and persons shown on the books of such Indirect
Participants as direct or indirect Certificate Owners. The Depository Agreement
provides that the Depository shall maintain book-entry records with respect to
the Certificate Owners and with respect to ownership and transfers of such
Certificates.
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 it represents or of brokerage firms for which it acts as
agent in accordance with the Depository's normal procedures.
(c) If (i)(A) the Depository advises the Depositor, the Paying
Agent or the Trustee in writing that the Depository is no longer willing or able
to properly discharge its responsibilities as Depository and (B) the Trustee,
the Paying Agent or the Depositor are unable after exercise of their reasonable
best efforts to locate a qualified successor or (ii) the Depositor at its option
advises the Trustee in writing that it elects to terminate the book-entry system
through the Depository, the Trustee or, if a Paying Agent has been appointed
under Section 4.05, the Paying Agent, shall notify all Certificate Owners,
through the Depository, of the occurrence of any such event and of the
availability of definitive, fully registered Certificates (the "Definitive
Certificates") to Certificate Owners requesting the same. Upon surrender to the
Trustee or, if a Paying Agent has been appointed under Section 4.05, the Paying
Agent, of the Book-Entry Certificates by the Depository for registration and
receipt by the Trustee or, if a Paying Agent has been appointed under Section
4.05, the Paying Agent, of an adequate supply of certificates from the
Depositor, the Trustee or if the Paying Agent is appointed under Section 4.05,
the Paying Agent shall issue the Definitive Certificates based on information
received from the Depository. Neither the Depositor, the Servicer, the Paying
Agent 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.
(d) The Certificates shall be issuable in the minimum original
dollar denominations (and integral multiples of $1,000.00 in excess of such
amount) and aggregate original dollar denominations per Class as set forth in
the following table (except that one Certificate of each of the Class A-P and
Class B-5 Certificates may be issued in a different denomination).
43
Aggregate Original Certificate
Minimum Principal Balance of all
Original Certificates of the CUSIP
Class Denomination Indicated Class Number
----- ------------ ----------------------------- ------
A-1 $25,000.00 $25,000,000.00 16162T WW 2
A-2 $25,000.00 $164,913,265.00 16162T WX 0
A-3 $25,000.00 $6,387,000.00 16162T WY 8
A-4 $25,000.00 $19,033,350.00 16162T WZ 5
A-P(1) $25,000.00 $127,349.00 16162T XA 9
A-R(2) $100.00 $100.00 16162T XB 7
A-X (3) (3) 16162T XF 8
M $100,000.00 $3,600,393.00 16162T XC 5
B-1 $100,000.00 $2,587,783.00 16162T XD 3
B-2 $100,000.00 $1,125,123.00 16162T XE 1
B-3 $100,000.00 $900,098.00 16162T XG 6
B-4 $100,000.00 $562,561.00 16162T XH 4
B-5 $100,000.00 $787,589.43 16162T XJ 0
---------------
(1) The Class A-P Certificates are principal only certificates and are not
entitled to payments of interest.
(2) The Class A-R Certificate represents Residual Interest.
(3) The Class A-X Certificates have no Principal Balance, but accrue
interest on the Class A-X Notional Amount (initially, $221,446,169.68).
The Certificates shall be signed by manual or facsimile
signature on behalf of the Depositor by an officer of the Depositor.
Certificates bearing the manual or facsimile signatures of individuals who were
at the time of signature officers of the Depositor shall bind the Depositor,
notwithstanding that such individuals or any of them have ceased to be an
officer prior to the authentication and delivery of such Certificate or did not
hold such offices at the date of such Certificates. No Certificate shall be
entitled to any benefit under this Agreement, or be valid for any purpose,
unless there appears on such Certificate a manual authentication by an officer
of the Trustee (or, if an Authenticating Agent has been appointed pursuant to
Section 4.06, the Authenticating Agent) 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.
Section 4.02. Registration of Transfer and Exchange of
Certificates. (a) The Trustee or, if a Paying Agent has been appointed hereunder
pursuant to Section 4.05, the Paying Agent, shall cause to be kept a Certificate
Register in which, subject to such reasonable regulations as it may prescribe,
the Trustee shall provide for the registration of Certificates and of transfers
and exchanges of Certificates as herein provided.
(b) Upon surrender for registration of transfer of any
Certificate at any office or agency of the Trustee or, if a Paying Agent has
been appointed under Section 4.05, the Paying Agent, maintained for such
purpose, the Depositor shall execute and the Trustee (or, if an Authenticating
Agent is appointed under Section 4.06, the Authenticating Agent) shall
authenticate and deliver, in the name of
44
the designated transferee or transferees, a Certificate of a like Class and
aggregate Percentage Interest and dated the date of authentication.
(c) No transfer of a Class A-X, Class B-3, Class B-4 or Class
B-5 Certificate shall be made unless such transfer is made pursuant to an
effective registration statement or otherwise in accordance with the
requirements under the Securities Act of 1933, as amended. If such a transfer is
to be made in reliance upon an exemption from said Act, (i) the Depositor may
require (except with respect to the initial transfer of a Class B-3, Class B-4
or Class B-5 Certificate from Credit Suisse First Boston Corporation and except
if the transferee executes a certificate substantially in the form of Exhibit I
hereto) a written opinion of independent counsel acceptable to and in form and
substance satisfactory to the Depositor that such transfer may be made pursuant
to an exemption, describing the applicable exemption and the basis therefor,
from said Act and laws or is being made pursuant to said Act and laws, which
opinion of counsel shall not be an expense of the Trust Fund, the Trustee, the
Depositor or the Servicer, and (ii) the Depositor shall require the transferee
to execute a certification substantially in the form of Exhibit H or Exhibit I.
(d) No transfer of an ERISA Restricted Certificate or the
Class A-R Certificate shall be made to any employee benefit plan subject to
Section 406 of ERISA or Section 4975 of the Code or materially similar
provisions of applicable federal, state or local law ("Similar Law"), or a
person acting on behalf of such plan, except pursuant to Clause (i)(B) or Clause
(ii) below or using the assets of such plan. No transfer of an ERISA Restricted
Certificate or the Class A-R Certificate shall be made unless the Depositor
shall have received either (i) a representation letter, substantially in the
form of Exhibit M, from the transferee of such Certificate acceptable to and in
form and substance satisfactory to the Depositor, to the effect that (A) such
transferee is not an employee benefit plan subject to Section 406 of ERISA or
Section 4975 of the Code or Similar Law, or a person acting on behalf of any
such plan or using the assets of such plan, or alternatively, (B) the source of
funds for the purchase of such Certificate is an "insurance company general
account" within the meaning of Prohibited Transaction Class Exemption 95-60
("PTCE 95-60"), 60 Fed. Reg. 35925 (July 12, 1995), and the acquisition and
holding of such Certificate is exempt under PTCE 95-60, which representation
letter shall not be an expense of the Trustee, the Depositor or the Servicer, or
(ii) in the case of an ERISA Restricted Certificate presented for registration
in the name of an employee benefit plan subject to ERISA or Section 4975 of the
Code or Similar Law (or comparable provisions of any subsequent enactments) or a
trustee of any such plan or any other Person who is using the assets of any such
plan to effect such acquisition, an Opinion of Counsel or such other
representation as required by and satisfactory to the Depositor to the effect
that the purchase or holding of such ERISA Restricted Certificate will not
result in the assets of the Trust Fund being deemed to be "plan assets" pursuant
to the Department of Labor Plan Asset Regulations set forth in 29 C.F.R.
ss.2510.3-101 and subject to the fiduciary responsibility provisions of ERISA or
the prohibited transaction provisions of the Code or Similar Law, will not
constitute or result in a prohibited transaction within the meaning of Section
406 or Section 407 of ERISA or Section 4975 of the Code or Similar Law, and will
not subject the Trustee, the Depositor or the Servicer to any obligation in
addition to those undertaken in this Agreement, which opinion of counsel or
other representation shall not be an expense of the Trustee, the Depositor or
the Servicer.
(e) At the option of a Certificateholder, a Certificate may be
exchanged for another Certificate or Certificates of authorized denominations of
a like Class, upon surrender of the Certificate to be exchanged at any office or
agency of the Trustee or, if a Paying Agent has been appointed under Section
4.05, the Paying Agent, maintained for such purpose. Whenever the Certificate is
so surrendered
45
for exchange, the Depositor shall execute and the Authenticating Agent shall
authenticate and deliver, the Certificate which the Certificateholder making the
exchange is entitled to receive. Every Certificate presented or surrendered for
transfer or exchange shall (if so required by the Authenticating Agent) be duly
endorsed by, or be accompanied by a written instrument of transfer in the form
satisfactory to the Authenticating Agent duly executed by, the Holder thereof or
his attorney duly authorized in writing.
(f) No service charge shall be made to the Holder for any
transfer or exchange of a Certificate, but the Servicer may require payment by
the Certificateholders of a sum sufficient to cover any tax or governmental
charge that may be imposed in connection with any transfer or exchange of such
Certificate.
(g) All Certificates surrendered for transfer or exchange
shall be destroyed by the Trustee or, if a Paying Agent has been appointed under
Section 4.05, the Paying Agent, in accordance with the Trustee's or, if a Paying
Agent has been appointed under Section 4.05, the Paying Agent's, standard
procedures.
(h) [Reserved].
(i) A Disqualified Organization is prohibited from acquiring
beneficial ownership of a Class A-R Certificate. Notwithstanding anything to the
contrary contained herein, unless and until the Servicer shall have received an
Opinion of Counsel, satisfactory to it in form and substance, to the effect that
the absence of the conditions contained in this Section 4.02(i) would not result
in the imposition of federal tax upon the Trust Fund or cause the Trust Fund to
fail to qualify as a REMIC, no transfer, sale or other disposition of the Class
A-R Certificate (including for purposes of this section any beneficial interest
therein) may be made without the express written consent of the Certificate
Registrar or, if no Certificate Registrar is appointed, the Trustee, which
consent is to be granted by the Certificate Registrar or, if no Certificate
Registrar is appointed, the Trustee only upon compliance with the requirements
of this Section. As a condition to granting its consent to a transfer of a Class
A-R Certificate, the Servicer shall require the proposed transferee of such
Certificate (including, in the case of the initial issuance of the Class A-R
Certificate, the initial Holder thereof) to execute a letter and affidavit
substantially in the form attached hereto as Exhibit K. In the absence of a
contrary instruction from the transferor of such Certificate, declaration (11)
in such affidavit may be left blank. If the transferor requests by written
notice to the Certificate Registrar or, if no Certificate Registrar is
appointed, the Trustee, prior to the date of the proposed transfer that one of
the two other forms of declaration (11) of such affidavit be used, then the
Certificate Registrar or, if no Certificate Registrar is appointed, the Trustee,
shall require that such form of declaration (11) be included in such affidavit.
As a condition to the granting of the consent referred to in
this Section 4.02(i), prior to the transfer, sale, pledge, hypothecation or
other disposition of the Class A-R Certificate or any interest therein, the
Certificate Registrar or, if no Certificate Registrar is appointed, the Trustee
shall require that (1) the proposed transferee deliver to the Trustee its
taxpayer identification number and state, under penalties of perjury that such
number is the social security or employee identification number, as the case may
be, of the transferee or provide an affidavit under penalties of perjury stating
that as of the date of such transfer such transferee is not and has no intention
of becoming a Disqualified Organization; (2) the proposed transferee deliver to
the Trustee an affidavit stating (i) that such transferee is not acquiring such
Class A-R Certificate as an agent, broker, nominee, or middleman for a
Disqualified Organization, (ii) if the Class A-R Certificate is a "non-economic
residual interest" within the meaning of Treas. Reg.
46
ss.1.860E-1(c)(2), (X) that no purpose of the acquisition of the Class A-R
Certificate is to avoid or impede the assessment or collection of tax, (Y) that
such transferee has historically paid its debts as they came due and will
continue to pay its debts as they come due, and (Z) that such transferee
represents that it understands that, as the holder of the non-economic residual
interest, the transferee may incur tax liabilities in excess of any cash flows
generated by the interest and that the transferee intends to pay taxes
associated with holding the residual interest, and (iii) unless the Certificate
Registrar or, if no Certificate Registrar is appointed, the Trustee consents to
the transfer of the Class A-R Certificate to a Person who is not a U.S. Person
and who has furnished a duly completed and effective Form W-8ECI (or any
successor thereto), that it is a U.S. Person; (3) if so requested by the
transferor in written notice provided to the Certificate Registrar or, if no
Certificate Registrar is appointed, the Trustee, prior to the date of the
proposed transfer, the proposed transferee deliver to the Trustee an affidavit
that includes a declaration made in the form of declaration (11) in the
affidavit set forth in Exhibit K requested by the transferor; and (4) the
transferor deliver to the Certificate Registrar or, if no Certificate Registrar
is appointed, the Trustee a written certification that as of the date of such
transfer it has no knowledge and no reason to know that the affirmations
described in clauses (1), (2) and (3) were false. The Certificate Registrar or,
if no Certificate Registrar is appointed, the Trustee shall not grant the
consent referred to in this Section 4.02(i) if it has actual knowledge that any
statement made in the affidavit issued pursuant to the preceding sentence is not
true. Notwithstanding any purported transfer, sale or other disposition of the
Class A-R Certificate to a Disqualified Organization, such transfer, sale or
other disposition shall be deemed to be of no legal force or effect whatsoever
and such Disqualified Organization shall not be deemed to be a Class A-R
Certificateholder for any purpose hereunder, including, but not limited to, the
receipt of distributions on such Class A-R Certificate. If any purported
transfer shall be in violation of the provisions of this Section 4.02(i) then
the prior holder of the Class A-R Certificate shall, upon discovery that the
transfer of such Class A-R Certificate was not in fact permitted by this Section
4.02(i), be restored to all rights as a Holder thereof retroactive to the date
of the purported transfer of such Class A-R Certificate. The Trustee and the
Servicer shall be under no liability to any Person for any registration or
transfer of a Class A-R Certificate that is not permitted by this Section
4.02(i) or for making payments due on such Class A-R Certificate to the
purported Holder thereof or taking any other action with respect to such
purported Holder under the provisions of this Agreement so long as the transfer
was not registered under the written certification of the Certificate Registrar
or, if no Certificate Registrar is appointed, the Trustee as described in this
Section 4.02(i). The prior Holder shall be entitled to recover from any
purported Holder of a Class A-R Certificate that was in fact not a permitted
purported transferee under this Section 4.02(i) at the time it became a
purported Holder all payments made to such purported Holder on such Class A-R
Certificate; provided that the Servicer shall not be responsible for such
recovery. Each Class A-R Certificateholder, by the acceptance of the Class A-R
Certificate, shall be deemed for all purposes to have consented to the
provisions of this Section 4.02(i) and to any amendment to this Agreement deemed
necessary by counsel of the Trustee or the Servicer to ensure that the Class A-R
Certificate is not transferred to a Disqualified Organization and that any
transfer of such Class A-R Certificate will not cause the imposition of a tax
upon the Trust Fund or cause the Trust Fund to fail to qualify as a REMIC. The
restrictions on transfer of the Class A-R Certificate will cease to apply and be
void upon receipt by the Certificate Registrar or, if no Certificate Registrar
is appointed, the Trustee of an Opinion of Counsel to the effect that such
restrictions on transfer are no longer necessary to avoid the risk of material
federal taxation to the Trust Fund or prevent the Trust Fund from qualifying as
a REMIC.
(j) The Servicer shall make available upon written request to
each Holder and each proposed transferee of a Class A-X, Class B-3, Class B-4 or
Class B-5 Certificate such information as
47
may be required to permit the proposed transfer to be effected pursuant to Rule
144A under the Securities Act of 1933, as amended.
Section 4.03. Mutilated, Destroyed, Lost or Stolen
Certificates. If (a) any mutilated Certificate is surrendered to the Trustee or,
if a Paying Agent has been appointed under Section 4.05, the Paying Agent, or
the Trustee or, if a Paying Agent has been appointed under Section 4.05, the
Paying Agent, receives evidence to its satisfaction of the destruction, loss or
theft of any Certificate, and (b) there is delivered to the Trustee or, if a
Paying Agent has been appointed under Section 4.05, the Paying Agent, such
security or indemnity as may be required by it to save it harmless, then, in the
absence of notice to the Trustee or, if a Paying Agent has been appointed under
Section 4.05, the Paying Agent, that such Certificate has been acquired by a
bona fide purchaser, the Trustee or, if a Paying Agent has been appointed under
Section 4.05, the Paying Agent, shall authenticate and deliver, in exchange for
or in lieu of any such mutilated, destroyed, lost or stolen Certificate, a new
Certificate of like tenor and Class. Upon the issuance of any new Certificate
under this Section, the Trustee or, if a Paying Agent has been appointed under
Section 4.05, the Paying Agent, may require of the Certificateholder 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 connected therewith. Any
replacement Certificate of any Class issued pursuant to this Section shall
constitute complete and indefeasible evidence of ownership of the Percentage
Interest in the distributions to which the Certificateholders of such Class are
entitled, as if originally issued, whether or not the mutilated, destroyed, lost
or stolen Certificate shall be found at any time, and such mutilated, destroyed,
lost or stolen Certificate shall be of no force or effect under this Agreement,
to the extent permitted by law.
Section 4.04. Persons Deemed Owners. Prior to due presentation
of a Certificate of any Class for registration of transfer, the Depositor, the
Servicer, the Paying Agent and the Trustee may treat the person in whose name
any Certificate is registered on the Record Date as the owner of such
Certificate and the Percentage Interest in the distributions to which the
Certificateholders of such Class are entitled on the relevant date as the Holder
of such Certificate and the Percentage Interest represented by such Certificate
for the purpose of receiving remittances pursuant to Section 6.01 and for all
other purposes whatsoever, and neither the Depositor, the Servicer nor the
Trustee shall be affected by notice to the contrary.
Section 4.05. Appointment of Paying Agent; Certificate
Account. The Trustee may appoint a Paying Agent hereunder, which Paying Agent
shall not be Depositor, the Seller, or an affiliate of the Depositor or the
Seller unless such Paying Agent is the Corporate Trust Department of Chase. In
the event of any such appointment, on the Business Day prior to each
Distribution Date, the Servicer shall deposit or cause to be deposited with the
Paying Agent from funds on deposit in the Collection Account a sum up to the
Available Distribution Amount, such sum to be held in trust for the benefit of
Certificateholders in a segregated account (the "Certificate Account") which
shall be an Eligible Account in the name of "Citibank, N.A., as Trustee, in
trust for and for the benefit of the Certificateholders of Multi-Class Mortgage
Pass-Through Certificates, Chase Mortgage Finance Corporation, Series 2001-S1
Certificate Account". The Servicer shall cause the Paying Agent to perform each
of the obligations of the Paying Agent set forth herein and shall be liable to
the Trustee and the Certificateholders for failure of the Paying Agent to
perform such obligations. If the Paying Agent is a party other than the Trustee,
the Trustee shall have no liability in connection with the performance or
failure of performance of the Paying Agent. The Trustee designates the Corporate
Trust Department of Chase as the initial Paying Agent. Only the Trustee may
remove the Paying Agent, and may do so at will.
48
If, on any Distribution Date, the Paying Agent fails to
distribute to Certificateholders the amounts then on deposit in the Certificate
Account for the purposes specified herein, the Trustee shall be obligated
promptly upon its knowledge thereof to distribute such amounts to
Certificateholders in the manner and in such amounts based upon information
provided by the Servicer; provided that in no event shall the Trustee be
obligated for purposes of this paragraph to distribute to Certificateholders any
amounts other than those on deposit in the Certificate Account or expend any
funds not reimbursable pursuant to Section 10.05 hereof, except as otherwise
provided herein. Notwithstanding anything in this Agreement to the contrary, the
Trustee shall be liable to the Servicer and the Certificateholders only for its
negligence in connection with the withdrawal of funds from the Certificate
Account by the Trustee and the distribution of such funds by the Trustee to
Certificateholders pursuant to this paragraph.
The Servicer shall cause each Paying Agent other than the
Trustee to execute and deliver to the Servicer and the Trustee on the Closing
Date or, if subsequently appointed, on the date of appointment, a written
instrument executed by an officer of the Paying Agent in which such Paying Agent
shall agree with the Servicer and the Trustee that such Paying Agent will hold
all sums held by it for the payment to Certificateholders in trust for the
benefit of the Certificateholders entitled thereto until such sums shall be paid
to such Certificateholders.
Section 4.06. Authenticating Agents. (a) The Trustee may
appoint one or more Authenticating Agents (each, an "Authenticating Agent")
which shall be authorized to act on behalf of the Trustee in authenticating the
Certificates. Wherever reference is made in this Agreement to the authentication
of Certificates by the Trustee or the Trustee's certificate of authentication,
such reference shall be deemed to include authentication on behalf of the
Trustee by an Authenticating Agent and a certificate of authentication executed
on behalf of the Trustee by an Authenticating Agent. Each Authenticating Agent
must be an entity organized and doing business under the laws of the United
States of America or of any state, having a combined capital and surplus of at
least $15,000,000, authorized under such laws to do a trust business and subject
to supervision or examination by federal or state authorities. If the
Authenticating Agent is a party other than the Trustee, the Trustee shall have
no liability in connection with the performance or failure of performance of the
Authenticating Agent. The Trustee hereby appoints Chase as the initial
Authenticating Agent.
(b) Any Person into which any Authenticating Agent may be
merged or converted or with which it may be consolidated, or any Person
resulting from any merger, conversion or consolidation to which any
Authenticating Agent shall be a party, or any Person succeeding to the corporate
agency business of any Authenticating Agent, shall continue to be the
Authenticating Agent without the execution or filing of any paper or any further
act on the part of the Trustee or the Authenticating Agent.
(c) Any Authenticating Agent may at any time resign by giving
at least 30 days' advance written notice of resignation to the Trustee and the
Depositor. The Trustee may at any time terminate the agency of any
Authenticating Agent by giving written notice of termination to such
Authenticating Agent and the Depositor. Upon receiving a notice of resignation
or upon such a termination, or in case at any time any Authenticating Agent
shall cease to be eligible in accordance within the provisions of this Section
4.06, the Trustee may appoint a successor Authenticating Agent, shall give
written notice of such appointment to the Depositor and shall mail notice of
such appointment to all Holders of Certificates. Any successor Authenticating
Agent upon acceptance of its appointment hereunder shall become vested with all
the rights, powers, duties and responsibilities of its predecessor hereunder,
with like effect as if originally named as Authenticating Agent. No successor
Authenticating
49
Agent shall be appointed unless eligible under the provisions of this Section
4.06. No Authenticating Agent shall have responsibility or liability for any
action taken by it as such at the direction of the Trustee. Any Authenticating
Agent shall be entitled to reasonable compensation for its services and any such
compensation shall be payable solely by the Trustee, without any right of
reimbursement from the Depositor, the Servicer or the Trust Fund.
[END OF ARTICLE IV]
ARTICLE V
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
Section 5.01. Servicer to Service Mortgage Loans. The Servicer
shall service and administer the Mortgage Loans and shall have full power and
authority, acting alone or through Sub-Servicers as provided in Section 5.02, to
do any and all things which it may deem necessary or desirable in connection
with such servicing and administration, all in accordance with Accepted
Servicing Practices. Without limiting the generality of the foregoing, the
Servicer in its own name or in the name of a Sub-Servicer shall, pursuant to a
power of attorney granted hereby by the Trustee for such purposes, when the
Servicer or the Sub-Servicer, as the case may be, believes it appropriate in its
best judgment, execute and deliver, on behalf of the Certificateholders and the
Trustee or any of them, any and all instruments of satisfaction or cancellation,
or of partial or full release or discharge and all other comparable instruments,
with respect to the Mortgage Loans and with respect to the Mortgaged Properties;
provided, however, that subject to the provisions of this paragraph, the
Servicer may allow a modification with respect to a Mortgage Loan if the
Servicer would take such action in the ordinary course of its business if it
were the owner of the Mortgage Loan. The Servicer may agree to a modification of
any Mortgage Loan (the "Relevant Mortgage Loan") upon the request of the related
Mortgagor, provided that (i) the modification is in lieu of a refinancing and
the Mortgage Rate on the Relevant Mortgage Loan, as modified, is approximately a
prevailing market rate of newly-originated mortgage loans having similar terms,
(ii) the aggregate of the adjusted bases of all Modified Mortgage Loans
(including the Relevant Mortgage Loans) plus the aggregate adjusted bases of any
assets that are not qualified mortgages or permitted investments under Section
860G(a) of the Code that are assets of the Trust Fund established hereunder at
all times on any day is less than one percent of the aggregate of the adjusted
bases of all assets of the Trust Fund (including such Modified Mortgage Loans)
on such day, and (iii) the Servicer purchases the Relevant Mortgage Loan from
the Trust Fund as described below. Effective immediately after such
modification, and, in any event, on the same Business Day on which the
modification occurs, all right, title and interest of the Trustee in and to the
Modified Mortgage Loan shall automatically be deemed transferred and assigned to
the Servicer and all benefits and burdens of ownership thereof, including
without limitation the right to accrued interest thereon from and including the
date of modification and the risk of default thereon, shall pass to the
Servicer. To confirm such transfer and assignment, the Servicer, as servicer
hereunder, as soon as practicable shall execute an instrument of assignment of
the Modified Mortgage Loan without recourse in customary form to the Servicer in
its individual capacity. The Servicer shall deposit the Purchase Price for any
Modified Mortgage Loan in the Collection Account pursuant to Section 5.08. Upon
receipt by the Trustee of written notification of any such deposit signed by a
Servicing Officer, the Trustee shall release to the Servicer the related
Mortgage File and shall execute and deliver such instruments of transfer or
assignment, in each case without recourse, as shall be necessary more fully to
vest in the Servicer any Modified Mortgage Loan previously transferred and
assigned pursuant thereto.
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The Servicer shall furnish to the Trustee for execution and
redelivery to the Servicer or, at the request of the Servicer, a Sub-Servicer,
such documents necessary or appropriate to enable the Servicer to service and
administer the Mortgage Loans and the Trustee shall not be responsible for the
Servicer's application thereof. The Servicer agrees to remain eligible as either
a FNMA or FHLMC seller/servicer, or both, for so long as it is Servicer.
All Servicing Advances made by the Servicer in effecting the
timely payment of taxes, insurance and assessments on the properties subject to
the Mortgage Loans shall not, for the purpose of calculating monthly
distributions to Certificateholders, be added to the amount owing under the
related Mortgage Loans, notwithstanding that the terms of such Mortgage Loan so
permit, and such Servicing Advances shall be recoverable by the Servicer to the
extent permitted by Sections 5.09 and 5.23.
Section 5.02. Sub-Servicing Agreements Between Servicer and
Sub-Servicers; Enforcement of Sub-Servicer's Obligations. (a) The Servicer may
enter into Sub-Servicing Agreements with Sub-Servicers for the servicing and
administration of all or part of the Mortgage Loans. References in this
Agreement to actions taken or to be taken by the Servicer in servicing the
Mortgage Loans include actions taken or to be taken by a Sub-Servicer on behalf
of the Servicer. Each Sub-Servicing Agreement will be upon such terms and
conditions as are not inconsistent with this Agreement and as the Servicer and
the Sub-Servicer have agreed. The Servicer shall notify the Trustee in writing
promptly upon the appointment of any Sub-Servicer. For purposes of this
Agreement, the receipt by the Sub-Servicer of any amount with respect to a
Mortgage Loan (other than amounts representing servicing compensation or
reimbursement for an advance) shall be treated as the receipt by the Servicer of
such amount. The Sub-Servicer shall deposit all such funds in an Eligible
Account.
(b) As part of its servicing activities hereunder, the
Servicer, for the benefit of the Trustee and the Certificateholders, shall
enforce the obligations of each Sub-Servicer under the related Sub-Servicing
Agreement. Such enforcement, including, without limitation, the legal
prosecution of claims, termination of Sub-Servicing Agreements as appropriate,
and the pursuit of other remedies, shall be in such form and carried out to such
an extent and at such time as the Servicer, in its good faith business judgment,
would require were it the owner of the related Mortgage Loans. The Servicer
shall pay the costs of such enforcement at its own expense but shall be
reimbursed therefor only (i) from a general recovery resulting from such
enforcement only to the extent, if any, that such recovery exceeds all amounts
due in respect of the related Mortgage Loans or (ii) from a specific recovery of
costs, expenses or attorneys' fees against the party against whom such
enforcement is directed.
Section 5.03. Successor Sub-Servicers. The Servicer shall be
entitled to terminate any Sub-Servicing Agreement that may exist in accordance
with the terms and conditions of such Sub-Servicing Agreement and without any
limitation by virtue of this Agreement.
Section 5.04. Liability of the Servicer. Notwithstanding any
Sub-Servicing Agreement, any of the provisions of this Agreement relating to
agreements or arrangements between the Servicer and a Sub-Servicer or reference
to actions taken through a Sub-Servicer or otherwise, the Servicer shall remain
obligated and liable to the Trustee and Certificateholders for the servicing and
administering of the Mortgage Loans in accordance with the provisions of this
Agreement without diminution of such obligation or liability by virtue of such
Sub-Servicing Agreements or arrangements or by virtue of indemnification from
the Sub-Servicer and to the same extent and under the same terms and conditions
as if the Servicer alone were servicing and administering the Mortgage Loans.
The Servicer shall be
51
entitled to enter into any agreement with a Sub-Servicer for indemnification of
the Servicer and nothing contained in this Agreement shall be deemed to limit or
modify such indemnification.
Section 5.05. No Contractual Relationship Between Sub-Servicer
and Trustee or Certificateholders. Any Sub-Servicing Agreement that may be
entered into and any other transactions or services relating to the Mortgage
Loans involving a Sub-Servicer in its capacity as such and not as an originator
shall be deemed to be between the Sub-Servicer and the Servicer alone, and the
Trustee and Certificateholders shall not be deemed parties thereto and shall
have no claims, rights, obligations, duties or liabilities with respect to the
Sub-Servicer.
Section 5.06. Termination of Sub-Servicing Agreement. If the
Servicer shall for any reason no longer be the Servicer hereunder (including by
reason of any Event of Default), the Servicer shall thereupon terminate each
Sub-Servicing Agreement that may have been entered into, and the Trustee, its
designee or the successor servicer and the Trustee shall not be deemed to have
assumed any of the Servicer's interest therein or to have replaced the Servicer
as a party to any such Sub-Servicing Agreement.
Section 5.07. 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 proceed diligently to collect
all payments due under each of the Mortgage Loans when the same shall become due
and payable; provided, however, that the Servicer may elect, to the extent
consistent with Accepted Servicing Practices, to waive any late payment charge
and shall, to the extent such procedures shall be consistent with this
Agreement, follow such collection procedures as it follows with respect to
conventional mortgage loans held in its own portfolio. Any such arrangements
shall not diminish or otherwise affect the Servicer's obligation to make
Advances pursuant to Section 6.03.
Section 5.08. Establishment of Collection Account; Deposit in
Collection Account. With respect to all of the Mortgage Loans, the Servicer
shall segregate and hold all funds collected and received pursuant to a Mortgage
Loan separate and apart from any of its own funds and general assets and shall
establish and maintain one or more Collection Accounts for the benefit of the
Certificateholders (collectively, the "Collection Account") which are Eligible
Accounts, in the form of a trust account, in the name of "Citibank, N.A., as
Trustee, in trust for and for the benefit of the Certificateholders of Multi-
Class Mortgage Pass-Through Certificates, Chase Mortgage Finance Corporation,
Series 2001-S1 - Collection Account." Such Collection Account shall be
established with a commercial bank, a savings bank or a savings and loan
association. The Servicer may invest, or cause the institution maintaining the
Collection Account to invest, moneys in the Collection Account in Eligible
Investments, which shall mature not later than the Business Day next preceding
the Distribution Date next following the date of such investment and shall not
be sold or disposed of prior to its maturity. All income and gain realized from
any such investment shall be for the benefit of the Servicer as additional
compensation and shall be subject to its withdrawal or order from time to time.
The amount of any losses incurred in respect of any such investments (to the
extent not offset by income from other such investments) shall be deposited in
the Collection Account by the Servicer out of its own funds immediately as
realized; provided, however, that if the Trustee becomes Servicer, the Trustee
shall not be required to deposit the amount of any loss incurred prior to it
becoming Servicer.
52
The Servicer shall deposit or cause to be deposited in the
Collection Account on a daily basis (and not later than the second Business Day
following receipt), and retain therein:
(i) All payments which were received after the Cut-off Date on
account of principal of the Mortgage Loans (other than the principal
portion of Monthly Payments due on or before the Cut-off Date), and all
Principal Prepayments collected on or after the Cut-off Date;
(ii) All payments which were received after the Cut-off Date
on account of interest on the Mortgage Loans (net of the Servicing
Fee)(other than the interest portion of Monthly Payments due on or
before the Cut-off Date);
(iii) Net Liquidation Proceeds;
(iv) All Insurance Proceeds received by the Servicer under any
title, hazard or other insurance policy, including amounts required to
be deposited pursuant to Sections 5.16 and 5.20, other than proceeds to
be held in the Escrow Account or applied to the restoration or repair
of the Mortgaged Property (or Underlying Mortgaged Property, in the
case of a Co-op Loan) or released to the Mortgagor in accordance with
the Servicer's normal servicing procedures or otherwise applied or held
as required by applicable law;
(v) All awards or settlements in respect of condemnation
proceedings affecting any Mortgaged Property (or Underlying Mortgaged
Property, in the case of a Co-op Loan), which are not released to the
Mortgagor in accordance with the Servicer's normal servicing
procedures;
(vi) All Repurchase Proceeds;
(vii) All Advances made by the Servicer pursuant to
Section 6.03;
(viii) All amounts representing revenues under the insurance
provided pursuant to Section 5.19 to the extent of any losses borne by
any Certificateholder;
(ix) All revenues from any Mortgaged Property acquired by the
Servicer by foreclosure or deed in lieu of foreclosure net of any
Servicing Advances with respect to such Mortgaged Property; and
(x) Any other amounts required to be deposited therein
pursuant to this Agreement.
The Servicer shall maintain accounting records on a Mortgage
Loan-by-Mortgage Loan basis with respect to the Collection Account. The Servicer
shall give notice to the Trustee, the Depositor and each Rating Agency of any
change in the location of the Collection Account, prior to the use thereof.
Notwithstanding anything to the contrary herein, no Monthly Payment or any
portion thereof shall be permitted to remain in the Collection Account for more
than 12 months. Any Monthly Payment or any portion thereof that has remained in
the Collection Account for 12 months shall be deemed a Principal Prepayment and
distributed to Certificateholders pursuant to the provisions of this Agreement
on the Distribution Date immediately following the end of such 12 month period.
53
Section 5.09. Permitted Withdrawals from the Collection
Account. The Servicer may, from time to time, withdraw funds from the Collection
Account for the following purposes:
(i) to reimburse itself for Advances made pursuant to Section
6.03 (including amounts to reimburse the related Sub-Servicer for advances made
pursuant to the applicable Sub-Servicing Agreement), the Servicer's and the
Sub-Servicer's right to receive reimbursement pursuant to this subclause (i)
being limited to amounts received on particular Mortgage Loans which represent
Late Collections (net of the Servicing Fees) with respect to those particular
Mortgage Loans;
(ii) to pay itself the Servicing Fee;
(iii) to reimburse itself for unreimbursed Servicing Advances,
or to pay the related Sub-Servicer any unreimbursed Servicing Advances,
the Servicer's right to receive reimbursement or make payments to the
Sub-Servicer pursuant to this subclause (iii) with respect to any
Mortgage Loan being limited to related Liquidation Proceeds, Insurance
Proceeds, and condemnation awards;
(iv) to reimburse itself (or the related Sub-Servicer) or the
Depositor for expenses incurred by and recoverable by or reimbursable
to it pursuant to Section 5.01 or 5.16;
(v) to reimburse itself (or the related Sub-Servicer) for any
Nonrecoverable Advances;
(vi) to pay to itself (or the related Sub-Servicer) income
earned on the investment of funds deposited in the Collection Account;
(vii) to make deposits into the Certificate Account in the
amounts and in the manner provided for herein;
(viii) to make payments to itself or others pursuant to any
provision of this Agreement, and to clear and terminate the Collection
Account upon the termination of this Agreement; and
(ix) to withdraw amounts deposited in error.
Section 5.10. Establishment of Escrow Account; Deposits in
Escrow Account. With respect to those Mortgage Loans on which the Servicer or
any Sub-Servicer collects Escrow Payments, if any, the Servicer shall, and shall
cause the Sub-Servicer to, segregate and hold all funds collected and received
pursuant to each such 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 trust accounts. Such Escrow
Accounts shall be established with a commercial bank, a mutual savings bank or a
savings and loan association the deposits of which are insured by the FDIC in a
manner which shall provide maximum available insurance thereunder, and which may
be drawn on by the Servicer. The Servicer shall give notice to the Trustee of
the location of any Escrow Account, and of any change thereof, prior to the use
thereof. Nothing in this paragraph shall be deemed to require the Servicer to
collect Escrow Payments in the absence of a provision in the related Mortgage
requiring such collection.
54
The Servicer shall deposit, or cause to be deposited, in any
Escrow Account or Accounts on a daily basis, and retain therein, (i) all Escrow
Payments collected on account of any Mortgage Loans, for the purpose of
effecting timely payment of any such items as required under the terms of this
Agreement and (ii) all amounts representing proceeds of any hazard insurance
policy which are to be applied to the restoration or repair of any Mortgaged
Property (or Underlying Mortgaged Property, in the case of a Co-op Loan). The
Servicer shall make withdrawals therefrom only to effect such payments as are
required under this Agreement, and for such other purposes as are set forth in
Section 5.11. 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 related Mortgagor
and, to the extent required by law, the Servicer shall pay interest on escrowed
funds to the related Mortgagor notwithstanding that the Escrow Account is
non-interest-bearing or that interest paid thereon is insufficient for such
purposes.
Section 5.11. Permitted Withdrawals from Escrow Account.
Withdrawals from any Escrow Account or Accounts may be made by the Servicer only
(i) to effect timely payments of ground rents, taxes, assessments, water rates,
Standard Hazard Policy premiums, or other items constituting Escrow Payments for
the related Mortgage, (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
collections of Escrow Payments thereunder, (iii) to refund to any Mortgagor any
funds found to be in excess of the amounts required under the terms of the
related Mortgage Loan or under applicable law, (iv) for application to
restoration or repair of the property subject to the related Mortgage, (v) to
pay to the Servicer, or to the Mortgagor to the extent required by law, any
interest paid on the funds deposited in the Escrow Account, (vi) to clear and
terminate the Escrow Account on the termination of this Agreement or (vii) to
withdraw amounts deposited in error.
Section 5.12. Payment of Taxes, Insurance and Other Charges.
With respect to each Mortgage Loan, the Servicer shall maintain, or cause to be
maintained, accurate records reflecting any delinquencies or nonpayments with
regard to taxes, assessments and Standard Hazard Policy premiums. The Servicer
assumes full responsibility for ensuring the payment of all such bills and shall
effect payments of all such bills irrespective of each Mortgagor's faithful
performance in the payment of same or the making of the Escrow Payments and
shall make advances from its own funds to effect such payments.
Section 5.13. Transfer of Accounts. The Servicer may transfer
the Collection Account or Escrow Account to an Eligible Account maintained with
a different depository institution from time to time.
Section 5.14. [Reserved].
Section 5.15. Maintenance of the Primary Insurance Policies.
The Servicer shall not take, or permit any Sub-Servicer to 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 or Sub- Servicer, would
have been covered thereunder. Except as otherwise required by applicable law, to
the extent coverage is available and until the Loan-to-Value Ratio of the
related Mortgage Loan is reduced to 80%, the Servicer shall keep or cause to be
kept in full force and effect each such Primary Insurance Policy in an amount
equal to the amount by which the unpaid principal balance of the related
Mortgage
55
Loan exceeds 75% of the value (as described in the definition of Loan-to-Value
Ratio) of the related Mortgaged Property (or Underlying Mortgaged Property, in
the case of a Co-op Loan). The Servicer shall not cancel or refuse to renew any
such Primary Insurance Policy or consent to any Sub-Servicer canceling or
refusing to renew any such Primary Insurance Policy applicable to a Mortgage
Loan subserviced by it, that is in effect at the date of the initial issuance of
the Certificates and is required to be kept in force hereunder unless the
replacement Primary Insurance Policy for such canceled or non- renewed policy is
maintained with an insurer whose claims-paying ability is rated at least as high
as the original insurer or is acceptable to each Rating Agency as confirmed in
writing by each such Rating Agency, unless otherwise required by law.
Section 5.16. Maintenance of Standard Hazard Policies. (a) The
Servicer shall cause to be maintained for each Mortgage Loan (other than a Co-op
Loan) a Standard Hazard Policy with extended coverage as is prudent in the area
where the Mortgaged Property is located in an amount which is equal to the
greater of (i) the lesser of (A) 100% of the maximum insurable value of the
improvements securing such Mortgage Loan or (B) the principal balance owing on
such Mortgage Loan, or (ii) such amount required to prevent the Mortgagor or
mortgagee from becoming a co-insurer. If the Mortgaged Property is in an area
identified at the time of origination in the Federal Register by the Federal
Emergency Management Agency as having special flood hazards (and such 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
outstanding Principal Balance of the Mortgage Loan, (ii) the full insurable
value 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 property acquired upon foreclosure, or by deed in lieu of
foreclosure, of any Mortgage Loan, fire and hazard insurance with extended
coverage in an amount which is not less than the lesser of (i) the outstanding
principal balance of the Mortgage Loan or (ii) the maximum insurable value of
the improvements which are a part of such property, liability insurance, and, to
the extent available, flood insurance in an amount as provided above. Any
amounts collected by the Servicer under any such policies (other than amounts to
be applied to the restoration or repair of the property subject to the related
Mortgage or property acquired in liquidation of the Mortgage Loan, or released
to the Mortgagor in accordance with the Servicer's normal servicing procedures)
shall be deposited, subject to applicable law, in the Collection Account. It is
understood and agreed that no earthquake or other additional insurance need be
required by the Servicer of any Mortgagor or maintained on property acquired in
respect of a Mortgage Loan, other than pursuant to such applicable laws and
regulations as shall at any time be in force and as shall require such
additional insurance. All such Standard Hazard Policies and other policies shall
be endorsed with standard mortgagee clauses with loss payable to the Servicer or
its designee. Any such Standard Hazard Policies or other policies may be in the
form of blanket policies; provided, however, that in the event of any claim
arising in connection with a hazard loss the Servicer shall be obligated, in the
case of blanket insurance policies, to deposit in the Collection Account any
amount not payable under such blanket policy because of a deductible clause in
such policy and not otherwise payable under an individual policy. 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 are acceptable insurers in the discretion of the Servicer.
(b) Any cost incurred by the Servicer in maintaining any of
the foregoing insurance shall not, for the purpose of calculating monthly
distributions to Certificateholders, be added to the
56
amount owing under the Mortgage Loan, notwithstanding that the terms of the
Mortgage Loan so permit. Such costs (other than the costs of maintaining a
blanket hazard insurance policy not attributable to a specific Mortgaged
Property) shall be recoverable by the Servicer from the Mortgagor or out of
Insurance Proceeds or Liquidation Proceeds or to the extent permitted by Section
5.09.
Section 5.17. [Reserved].
Section 5.18. [Reserved]
Section 5.19. Fidelity Bond and Errors and Omissions
Insurance. The Servicer shall maintain, at its own expense, a blanket fidelity
bond and an errors and omissions insurance policy, with broad coverage with
responsible companies on all officers, employees or other persons acting on
behalf of the Servicer in any capacity with regard to the Mortgage Loans to
handle funds, money, documents and papers relating to the Mortgage Loans. Any
such fidelity bond and errors and omissions insurance shall protect and insure
the Servicer against losses, including forgery, theft, embezzlement, fraud,
errors and omissions and negligent acts of such persons and shall be maintained
at a level acceptable to FNMA. No provision of this Section 5.19 requiring such
fidelity bond and errors and omissions insurance shall diminish or relieve the
Servicer from its duties and obligations as set forth in this Agreement. Upon
request of the Trustee, the Servicer shall cause to be delivered to the Trustee
a certification evidencing coverage under such fidelity bond and insurance
policy. Promptly upon receipt of any notice from the surety or the insurer that
such fidelity bond or insurance policy has been terminated or modified in a
materially adverse manner, the Servicer shall notify the Trustee and each Rating
Agency of any such termination or modification.
Section 5.20. Collections under Insurance Policies;
Enforcement of Due-On-Sale Clauses; Assumption Agreements. (a) In connection
with its activities as administrator and servicer of the Mortgage Loans, the
Servicer agrees to present, on behalf of itself, the Trustee and the
Certificateholders, claims to the insurer under any Standard Hazard Policies
and, in this regard, to take such reasonable action as shall be necessary to
permit recovery under any insurance policies. Pursuant to Section 5.08, the
Servicer shall deposit Insurance Proceeds in the Collection Account.
(b) When any Mortgaged Property is conveyed by the Mortgagor,
the Servicer shall enforce any due-on-sale clause contained in any Mortgage Note
or Mortgage, to the extent permitted by such Mortgage Note or Mortgage,
applicable law and governmental regulations. Subject to the foregoing, the
Servicer is authorized to take or enter into an assumption or substitution
agreement from or with the Person to whom such property has been or is about to
be conveyed. In connection with such assumption or substitution, the Servicer
shall apply such underwriting standards and follow such practices and procedures
as shall be normal and usual and as it applies to mortgage loans owned solely by
it.
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 conveyance by
the Mortgagor of the Mortgaged Property or any assumption of a Mortgage Loan by
operation of law which the Servicer in good faith determines it may be
restricted by law from preventing, for any reason whatsoever.
57
(c) Subject to the Servicer's duty to enforce any due-on-sale
clause to the effect set forth in Section 5.20(b), in any case in which a
Mortgaged Property is to be conveyed to a Person by a Mortgagor, and such Person
is to enter into an assumption agreement or modification agreement or supplement
to the Mortgage Note or Mortgage, the Servicer shall so notify the Trustee by
forwarding to the Trustee the original copy of such assumption or substitution
agreement, which copy shall be added by the Trustee to the related Mortgage File
and shall, for all purposes, be considered a part of such Mortgage File to the
same extent as all other documents and instruments constituting a part thereof.
In connection with any such assumption, modification agreement or substitution
agreement, the interest rate of the related Mortgage Note shall not be changed,
the principal amount of the Mortgage Note shall not be increased or decreased
and the maturity of the Mortgage Note shall not be extended, nor shall it be
shortened by more than one year. Any fee collected by the Servicer for entering
into an assumption or substitution of liability agreement with respect to such
Mortgage Loan shall be retained by the Servicer as additional servicing
compensation.
Section 5.21. Income and Realization from Defaulted Mortgage
Loans. The Servicer, on behalf of the Trustee, shall foreclose upon or otherwise
comparably convert the ownership of Mortgaged Properties securing such of the
Mortgage Loans as come into and continue in default and as to which no
satisfactory arrangements can be made for collection of delinquent payments
pursuant to Section 5.07, shall manage, conserve, protect and operate such
Mortgaged Properties for the purposes of their prompt disposition and sale, and
shall dispose of such Mortgaged Properties on such terms and conditions as it
deems in the best interests of the Certificateholders. The Servicer shall sell
such property prior to the close of the third calendar year beginning after the
year in which such foreclosure or conversion occurs or such longer period as
would not prevent such Mortgaged Property from constituting "foreclosure
property" within the meaning of Section 860G(a)(8) of the Code. In connection
with such activities, the Servicer shall follow such practices and procedures as
it shall deem necessary or advisable, as shall be normal and usual in its
general mortgage servicing activities, including its management of foreclosed
properties for a temporary period as contemplated herein. The foregoing is
subject to the provisions of Section 5.28 of this Agreement and to the proviso
that the Servicer shall not be required to expend its own funds in connection
with any management, foreclosure or towards the restoration of any property
unless it shall determine that such management, restoration or foreclosure will
increase the Liquidation Proceeds of the Mortgage Loan to Certificateholders
after reimbursement to itself for such expenses (respecting which it shall have
priority for purposes of withdrawals from the Collection Account pursuant to
Section 5.09). The Servicer shall be permitted to earn income with respect to
any Mortgaged Properties, provided such income does not constitute "net income
from foreclosure property" within the meaning of Section 860G(c) of the Code.
The income earned from the management of such Mortgaged Properties, net of
reimbursement to the Servicer for expenses (including any taxes) incurred in
connection with such management, shall be applied to the payment of principal of
and interest on the related defaulted Mortgage Loans (with interest accruing and
principal amortizing as though such Mortgage Loans were still current) and all
such income shall be deemed, for all purposes in this Agreement, to be payments
on account of principal and interest on the related Mortgage Notes and shall be
deposited into the Collection Account. To the extent the income received is in
excess of the amount attributable to amortizing principal and accrued interest
at the Net Mortgage Rate on the related Mortgage Loan, such excess shall be
deposited in the Collection Account.
The Servicer shall take into account the existence of any
hazardous substances, hazardous wastes or solid wastes, as such terms are
defined in the Comprehensive Environmental Response Compensation and Liability
Act, as amended, the Resources Conservation and Recovery Act of
58
1976, as amended, or other federal, state or local environmental legislation, on
a Mortgaged Property (or Underlying Mortgaged Property, in the case of a Co-op
Loan), in determining whether to foreclose upon or otherwise comparably convert
the ownership of such property. To the extent that the Servicer has actual
knowledge of any such substance or waste, it shall consult with the Trustee
regarding the appropriate course of action. The Servicer shall not institute
foreclosure actions with respect to a property containing substance or waste as
described above if it reasonably believes that such action would not be
consistent with its servicing standards, and in no event shall the Servicer
manage, operate or take any other action with respect thereto which the Servicer
in good faith believes will result in "clean-up" or other liability under
applicable law. The net income from the rental or sale of a REO Property shall
be deposited in the Collection Account within two (2) Business Days after
receipt thereof by the Servicer.
The Servicer may enter into a special servicing agreement with
an unaffiliated holder of 100% Percentage Interest of the Class of Class B
Certificates then outstanding having the highest numerical class designation or
a holder of a class of securities representing interests in such Class B
Certificate and/or other subordinate mortgage pass-through certificates, such
agreement to be (i) substantially in the form of Exhibit J hereto or (ii)
subject to each Rating Agency's acknowledgment that the ratings of the
Certificates in effect immediately prior to the entering into of such agreement
would not be qualified, downgraded or withdrawn and the Certificates would not
be placed on credit review status (except for possible upgrading) as a result of
such agreement. Any such agreement may contain provisions whereby such holder
may instruct the Servicer to commence or delay foreclosure proceedings with
respect to delinquent Mortgage Loans and will contain provisions for the deposit
of cash by the holder that would be available for distribution to
Certificateholders if Liquidation Proceeds are less than they otherwise may have
been had the Servicer acted in accordance with its normal procedures.
Section 5.22. Trustee to Cooperate; Release of Mortgage Files.
(a) Upon becoming aware of the payment in full of any Mortgage Loan, or upon the
receipt by the Servicer of a notification that payment in full will be made in a
manner customary for such purposes, the Servicer shall immediately notify the
Trustee (if the Trustee holds the related Mortgage File) by a certification
(which certification shall include a statement to the effect that all amounts
received or to be received in connection with such payment which are required to
be deposited in the Collection Account pursuant to Section 5.08 have been or
will be so deposited) of a Servicing Officer and shall request delivery to it of
the Mortgage File. Upon receipt of such certification and request, within five
Business Days the Trustee shall release the related Mortgage File to the
Servicer and execute and deliver to the Servicer the request for reconveyance,
deed of reconveyance or release or satisfaction of mortgage or such other
instruments releasing the lien of the Mortgage as have been provided by the
Servicer to the Trustee, together with the Mortgage Note with written evidence
of cancellation thereon, and the Trustee shall have no further responsibility
with respect to said Mortgage File. Upon any such payment in full, or the
receipt of such notification, the Servicer is authorized to procure from the
Trustee under the deed of trust which secured the Mortgage Note, if any, a deed
of full reconveyance covering the property encumbered by such deed of trust,
which assignment of deed of trust, except as otherwise provided by any
applicable law, shall be recorded by the Servicer in the appropriate land
records in the jurisdiction in which the assignment of deed of trust is
recorded, or, as the case may be, to procure from the Trustee an instrument of
satisfaction or, if the Mortgagor so requests, an assignment without recourse,
which deed of reconveyance, instrument of satisfaction or assignment shall be
delivered by the Servicer to the Person or Persons entitled thereto. No expenses
incurred in connection with any instrument of satisfaction or deed of
reconveyance shall be chargeable to the Collection Account or to the Trustee.
59
(b) From time to time as is appropriate for the servicing or
foreclosure of any Mortgage Loan, the Servicer shall deliver to the Trustee a
certificate of a Servicing Officer requesting that possession of the Mortgage
File be released to the Servicer and certifying as to the reason for such
release and that such release will not invalidate any insurance coverage
provided in respect of the Mortgage Loan under any of the insurance policies
required by this Agreement. With such certificate, the Servicer shall require
that the Trustee release the Mortgage File, and, within five Business Days, the
Trustee shall deliver the Mortgage File or any document therein to the Servicer.
The Servicer shall cause each Mortgage File so released to be returned to the
Trustee when the need therefor by the Servicer no longer exists, unless (i) the
Mortgage Loan has been liquidated and the Net Liquidation Proceeds relating to
the Mortgage Loan have been deposited in the Collection Account or (ii) the
Mortgage File has been delivered to an attorney, or to a public trustee or other
public official as required by law, for purposes of initiating or pursuing legal
action or other proceedings for the foreclosure of the Mortgaged Property either
judicially or non-judicially, and the Servicer has delivered to the Trustee a
certificate of a Servicing Officer in the form of Exhibit L hereto certifying as
to the name and address of the Person to which such Mortgage File was delivered
and the purpose or purposes of such delivery.
(c) Upon written request of the Servicer, the Trustee shall
execute and deliver to the Servicer any court pleadings, requests for trustee's
sale or other documents prepared by and delivered by the Servicer to the Trustee
necessary to the foreclosure or trustee's sale in respect of a Mortgaged
Property or to any legal action brought to obtain judgment against any Mortgagor
on the Mortgage Note or Mortgage or to obtain a deficiency judgment, or to
enforce any other remedies or rights provided by the Mortgage Note or Mortgage
or otherwise available at law or in equity. Together with such documents or
pleadings, the Servicer shall deliver to the Trustee a certificate of a
Servicing Officer requesting that such pleadings or documents be executed by the
Trustee and certifying as to the reason such documents or pleadings are required
and that the execution and delivery thereof by the Trustee will not invalidate
any insurance coverage under the insurance policies required under this
Agreement or invalidate or otherwise affect the lien of the Mortgage, except for
the termination of such a lien upon completion of the foreclosure or trustee's
sale.
Section 5.23. Servicing and Other Compensation. The Servicer,
as compensation for its activities hereunder, shall be entitled to receive, on
or prior to each Distribution Date, the amounts provided for as the Servicing
Fee and as reimbursement for Nonrecoverable Advances, Servicing Advances and
reimbursement for Advances, all as specified by Section 5.09. The amount of
compensation or reimbursement provided for shall be accounted for on a Mortgage
Loan-by-Mortgage Loan basis.
Additional servicing compensation in the form of assumption
fees, prepayment fees and late payment charges shall be retained by the
Servicer, to the extent permitted by applicable law. The Servicer shall be
required to pay all expenses incurred by it in connection with its servicing
activities hereunder (including the fees and expenses of the Trustee and any
Sub-Servicer) and shall not be entitled to reimbursement therefor except as
specifically provided in Sections 5.09 and 5.21.
Section 5.24. 1934 Act Reports. (a) The Paying Agent shall, on
behalf of the Trust, make all filings ("Periodic Reports") required to be made
by the Depositor or the Trust (other than the filings relating to the closing of
this transaction) with respect to the Class A Certificates, the Class M
Certificates, the Class B-1 Certificates and the Class B-2 Certificates pursuant
to the Securities Exchange
60
Act of 1934, as amended (the "Exchange Act") and the rules and regulations of
the Securities and Exchange Commission (the "Commission") thereunder.
(b) Within 30 days after the beginning of the first fiscal
year during which the Trust's obligation to file Periodic Reports pursuant to
the Exchange Act shall have been suspended, the Depositor may prepare, or cause
to be prepared, a notice on Commission Form 15 ("Form 15") and is hereby
authorized to and shall execute such Form 15 on the Trust's behalf; provided,
however, that the Depositor shall be under no obligation to prepare such notice
if the number of Certificateholders exceeds 300. The Depositor shall file any
notice on Form 15 with the Commission in accordance with the provisions of Rule
15d-6 under the Exchange Act.
Section 5.25. Annual Statement as to Compliance.
The Servicer will deliver to the Depositor and the Trustee on
or before March 20 of each year, beginning with March 20 in the year which
begins not less than three months after the Closing Date, an Officers'
Certificate stating, as to each signer thereof, that (i) a review of the
activities of the Servicer during the preceding calendar year and of performance
under this Agreement has been made under such officer's supervision, (ii) to the
best of such officer's knowledge, based on such review, the Servicer has
fulfilled all its obligations under this Agreement throughout such year, or, if
there has been a default in the fulfillment of any such obligation, specifying
each such default known to such officer and the nature and status thereof and
(iii) to the best of such officer's knowledge, each Sub-Servicer has fulfilled
its obligations under its Sub-Servicing Agreement in all material respects, or
if there has been a material default in the fulfillment of such obligations,
specifying such default known to such officers and the nature and status
thereof. Copies of such statement shall be provided to each Rating Agency by the
Servicer. Copies of such statement shall also be provided by the Servicer to any
Certificateholder upon request. If the Servicer shall fail to provide such
copies and a Responsible Officer of the Trustee is aware that the Servicer has
not so provided copies, the Trustee shall provide such copies at the Servicer's
expense if the Trustee has received such statement.
Section 5.26. Annual Independent Public Accountants' Servicing
Report. On or before March 20 of each year, beginning with March 20 in the year
which begins not less than three months after the Closing Date, the Servicer at
its expense shall cause a firm of independent public accountants which is a
member of the American Institute of Certified Public Accountants to furnish a
statement to the Depositor and the Trustee to the effect that such firm has
examined certain documents and records relating to the servicing of the Mortgage
Loans and that, on the basis of such examination conducted substantially in
compliance with the Uniform Single Audit Program for Mortgage Bankers, such
servicing has been conducted in compliance with the manner of servicing set
forth in pooling and servicing agreements substantially similar to this
Agreement, except for (i) such exceptions as such firm shall believe to be
immaterial and (ii) such other exceptions as shall be set forth in such
statement. Copies of such statement shall be provided to each Rating Agency,
and, upon request, to the Certificateholders, by the Servicer, or by the Trustee
at the Servicer's expense if the Trustee has received such statement and the
Servicer shall fail to provide such copies and the Trustee is aware that the
Servicer has not so provided copies.
Section 5.27. Access to Certain Documentation; Rights of the
Depositor in Respect of the Servicer. The Servicer shall provide access to the
Trustee and Certificateholders which are savings and loan associations, banks or
insurance companies or examiners of any federal or state banking or
61
insurance regulatory authority to the documentation regarding the Mortgage Loans
if so required by applicable regulations of any regulatory authority, such
access to be afforded subject to reimbursement for expenses without charge but
only upon reasonable request and during normal business hours at the offices of
the Servicer designated by it. The Depositor may, but is not obligated to,
enforce the obligations of the Servicer under this Agreement and may, but is not
obligated to, appoint and cause a designee to perform, any defaulted obligations
of the Servicer hereunder or exercise the rights of the Servicer hereunder;
provided that the Servicer shall not be relieved of any of its obligations
hereunder by virtue of the appointment of a designee by the Depositor or its
designee. The Depositor shall not assume any responsibility or liability for any
action or failure to take action by the Servicer and is not obligated to
supervise the performance of the Servicer under this Agreement or otherwise.
Section 5.28. REMIC-Related Covenants. For as long as the
Trust Fund shall exist, the Servicer and the Trustee shall act in accordance
herewith to assure continuing treatment of the Trust Fund as a REMIC. In
particular:
(a) The Servicer shall not create, or permit the creation of,
any "interests" in the Trust Fund within the meaning of Section 860G(a) of the
Code other than the "regular interests" in the Trust Fund designated as such in
Section 2.04(a) and the Residual Interest;
(b) As of all times as may be required by the Code, the
Servicer will ensure that substantially all of the assets of the Trust Fund will
consist of "qualified mortgages" as defined in section 860G(a)(3) of the Code
and "permitted investments" as defined in section 860G(a)(5) of the Code. The
Servicer and the Trustee, upon the direction of the Servicer, also will maintain
records that are sufficient to indicate the Trust Fund's compliance with
applicable requirements of the Code (and applicable Proposed, Temporary or final
Treasury regulations) relating to the assets held by the Trust Fund. Further,
the Servicer shall not permit and the Trustee shall not accept the transfer or
substitution of any Mortgage Loan other than pursuant to Section 3.03, 5.01 or
5.21 of this Agreement, and the Servicer shall, in any case, not permit
substitution later than two years from the Closing Date unless the Servicer and
the Trustee have received an Opinion of Counsel, which will not be an expense of
the Trust Fund, that such transfer or substitution would not adversely affect
the REMIC status of the Trust Fund or would not otherwise be prohibited by this
Agreement;
(c) The Servicer shall ensure that the Trust Fund does not
receive a fee or other compensation for services and that the Trust Fund does
not receive any income from assets other than "qualified mortgages" within the
meaning of section 860G(a)(3) of the Code or "permitted investments" within the
meaning of section 860G(a)(5) of the Code, and shall take whatever action it
deems necessary to avoid any material tax imposed by the Code on the Trust Fund;
(d) The Trustee shall not sell or permit the sale of all or
any portion of the Mortgage Loans or of any Eligible Investment unless such sale
is as a result of a repurchase of the Mortgage Loans pursuant to this Agreement
or the Trustee has received an Opinion of Counsel, which will not be an expense
of the Trust Fund or the Trustee, to the effect that such sale (i) is pursuant
to a "qualified liquidation" as defined in section 860F(a)(4) of the Code and as
described in Section 11.01 hereof, or (ii) would not be treated as a "prohibited
transaction" within the meaning of section 860F(a)(2) of the Code that results
in the realization of a material amount of gain or loss for federal income tax
purposes;
62
(e) The Trustee shall not accept any contribution to the Trust
Fund after the Startup Day without an Opinion of Counsel (which shall not be an
expense of the Trustee) that such contribution is included within the exceptions
provided in Section 860G(d)(2) of the Code and, therefore, will not be subject
to the tax imposed by Section 860G(d)(1) of the Code; and
(f) Notwithstanding anything to the contrary in this
Agreement, the Servicer and the Trustee, at the direction of the Servicer, shall
take any other action or refuse to take any action otherwise required (including
adjusting the Purchase Price for any Mortgage Loan) where the Servicer deems
such action or inaction reasonably necessary to ensure the REMIC status of the
Trust Fund under the Code and applicable regulations or to avoid the imposition
of any material tax liability on the Trust Fund that will affect amounts
distributable to the Certificateholders.
(g) In the event that any applicable federal, state or local
tax, including interest, penalties or assessments, additional amounts or
additions to tax, is imposed on the Trust Fund, such tax shall be treated in the
same manner as a Realized Loss and shall be charged against amounts otherwise
distributable to the Holders of the Certificates, except as provided in the last
sentence of this Section 5.28 (g). The Trustee or, if a Paying Agent has been
appointed under Section 4.05, the Paying Agent shall withdraw from the
Collection Account sufficient funds to pay or provide for the payment of, and to
actually pay, such tax as is estimated to be legally owed by (but such
authorization shall not prevent the Trustee or, if a Paying Agent has been
appointed under Section 4.05, the Paying Agent from contesting, at the expense
of the Trust Fund (other than as a consequence of a breach of its obligations
under this Agreement), any such tax in appropriate proceedings, and withholding
payment of such tax, if permitted by law, pending the outcome of such
proceedings). The Trustee or, if a Paying Agent has been appointed under Section
4.05, the Paying Agent is hereby authorized to and shall segregate, into a
separate non- interest bearing account, the net income from any "prohibited
transaction" under Code Section 860F(a), the amount of any taxable contribution
to the Trust Fund after the Startup Day that is subject to tax under Code
Section 860G(d), and 35% of any estimated "net income from foreclosure property"
under Section 860G(c) and use such income or amount, to the extent necessary, to
pay such tax. To the extent that any such tax is paid to the Internal Revenue
Service or applicable state or local tax authorities, the Trustee or a Paying
Agent has been appointed under Section 4.05, the Paying Agent shall retain an
equal amount from future amounts otherwise distributable to the Holder of the
Class A-R Certificate and shall distribute such retained amounts to the Holders
of the other Classes of Certificates, to the extent they remain outstanding,
until they are fully reimbursed for any amount of such taxes previously charged
to the then Holder of the Class A-R Certificate. Neither the Trustee nor the
Servicer shall be responsible for any taxes imposed on the Trust Fund except to
the extent such taxes arise as a consequence of a breach of their respective
obligations under this Agreement.
[END OF ARTICLE V]
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ARTICLE VI
PAYMENTS TO THE CERTIFICATEHOLDERS
Section 6.01. Distributions. (a) On each Distribution Date,
the Paying Agent shall apply an equal amount to the Available Distribution
Amount in the following order of priority:
(i) to the Non-PO Class A Certificateholders, all
distributable amounts up to the sum of (A) the Aggregate Class A
Interest Accrual Amount and (B) the Aggregate Class A Interest
Shortfall;
(ii) the balance, if any, of the Available Distribution Amount
shall be allocated, first, pro rata (in accordance with the maximum
amounts distributable in accordance with this paragraph (ii)) and
concurrently between (A) the Non-PO Class A Certificateholders, the
amounts distributable pursuant to paragraph (b)(ii)(A) below, up to the
Non-PO Class A Optimal Principal Amount and (B) the Class A-P
Certificateholders, the Class A-P Amount, in accordance with paragraph
(b)(ii)(B) below and second, to the Class A-P Certificateholders, the
Class A-P Shortfall Amount, in accordance with paragraph (b)(iii)
below;
(iii) to the Class M Certificateholders, the balance, if any,
of the Available Distribution Amount after making the distributions
provided for in paragraphs (i) and (ii) above, in accordance with, and
up to the amount calculated pursuant to, Section 6.01(c) below;
(iv) to the Class B Certificateholders, the balance, if any,
of the Available Distribution Amount after making the distributions
provided for in paragraphs (i) through (iii) above, in accordance with,
and up to the amounts calculated pursuant to, Section 6.01(d) below;
and
(v) to the Class A-R Certificateholders the balance, if any,
of the Available Distribution Amount remaining after the distributions
provided for in paragraphs (i) through (iv) above.
(b) Amounts payable to the Class A Certificateholders on any
Distribution Date shall be distributed as follows:
(i) to the extent the amount available for distribution
pursuant to paragraph (a)(i)(A) above is sufficient:
(A) to the Class A-1 Certificateholders, (1) the
Class A-1 Interest Accrual Amount plus (2) the Class A-1
Shortfall from the preceding Distribution Date;
(B) to the Class A-2 Certificateholders, (1) the
Class A-2 Interest Accrual Amount plus (2) the Class A-2
Shortfall from the preceding Distribution Date;
(C) to the Class A-3 Certificateholders, (1) the
Class A-3 Interest Accrual Amount plus (2) the Class A-3
Shortfall from the preceding Distribution Date, provided,
however, that on each Distribution Date prior to the Class A-3
Accretion Termination
64
Date, amounts calculated pursuant to this clause (E) will be
added to the Outstanding Certificate Principal Balance of the
Class A-3 Certificates and distributed, as principal, in
accordance with Section 6.01(b)(i)(G);
(D) to the Class A-4 Certificateholers, (1) the Class
A-4 Interest Accrual Amount plus (2) the Class A-4 Shortfall
from the preceding Distribution Date;
(E) to the Class A-R Certificateholder, (1) the Class
A-R Interest Accrual Amount plus (2) the Class A-R Shortfall
from the preceding Distribution Date; and
(F) to the Class A-X Certificateholders, (1) the
Class A-X Interest Accrual Amount plus (2) the Class A-X
Shortfall from the preceding Distribution Date;
(G) on each Distribution Date prior to the Class A-3
Accretion Termination Date, the Class A-3 Accrual Amount will
be distributed as principal sequentially to the Class A-2 and
Class A-3 Certificates until the Outstanding Certificate
Principal Balance of each such Class has been reduced to zero;
(ii) concurrently, (A) to the Non-PO Class A
Certificateholders, up to the Non-PO Class A Optimal Principal Amount,
allocated among the Non-PO Class A Certificates in accordance with the
Non-PO Class A Principal Payment Rules and (B) to the Class A-P
Certificateholders, the Class A-P Amount;
(iii) to the Class A-P Certificateholders, the Class A-P
Shortfall Amount; provided, however, that any amounts distributed
pursuant to this Section 6.01(b)(iii) shall not cause a further
reduction in the Outstanding Certificate Principal Balance of the Class
A-P Certificates; and
(iv) If the Available Distribution Amount is insufficient to
make the distributions set forth in paragraph (b)(i) above, the Paying
Agent shall distribute the Available Distribution Amount to the Non-PO
Class A Certificateholders pro rata in accordance with the amounts
otherwise distributable to them pursuant to paragraph (b)(i)(A)-(G)
above.
(c) Amounts payable on any Distribution Date to the Class M
Certificateholders shall be distributed up to an amount equal to (A) the Class M
Interest Accrual Amount plus (B) the Class M Shortfall from the preceding
Distribution Date plus (C) the portion of the Subordinated Optimal Principal
Amount allocable (pursuant to Section 6.01(e)) to the Class M Certificates plus
(D) any Carry-over Subordinated Principal Amounts with respect to the Class M
Certificates.
(d) Amounts payable on any Distribution Date to the Class B
Certificateholders pursuant to Section 6.01(a)(iv) shall be distributed in the
following priority:
(1) first, to the Class B-1 Certificateholders, up to an
amount equal to (A) the Class B-1 Interest Accrual Amount plus (B) the Class B-1
Shortfall from the preceding Distribution Date plus (C) the pro rata portion, if
any, of the Subordinated Optimal Principal Amount allocable to the Class B-1
Certificates in accordance with Section 6.01(e) plus (D) any Carry-over
Subordinated Principal Amounts with respect to the Class B-1 Certificates plus
(E) any portion of the Subordinated Optimal Principal
65
Amount allocated to the Class M Certificates in excess of the Outstanding
Certificate Principal Balance of such Class;
(2) second, to the Class B-2 Certificateholders, up to an
amount equal to (A) the Class B-2 Interest Accrual Amount plus (B) the Class B-2
Shortfall from the preceding Distribution Date plus (C) the pro rata portion, if
any, of the Subordinated Optimal Principal Amount allocable to the Class B-2
Certificates in accordance with Section 6.01(e) plus (D) any Carry-over
Subordinated Principal Amounts with respect to the Class B-2 Certificates plus
(E) any portion of the Subordinated Optimal Principal Amount allocated to the
Class B-1 Certificates in excess of the Outstanding Certificate Principal
Balance of such Class;
(3) third, to the Class B-3 Certificateholders, up to an
amount equal to (A) the Class B-3 Interest Accrual Amount plus (B) the Class B-3
Shortfall from the preceding Distribution Date plus (C) the pro rata portion, if
any, of the Subordinated Optimal Principal Amount allocable to the Class B-3
Certificates in accordance with Section 6.01(e) plus (D) any Carry-over
Subordinated Principal Amounts with respect to the Class B-3 Certificates plus
(E) any portion of the Subordinated Optimal Principal Amount allocated to the
Class B-2 Certificates in excess of the Outstanding Certificate Principal
Balance of such Class;
(4) fourth, to the Class B-4 Certificateholders, up to an
amount equal to (A) the Class B-4 Interest Accrual Amount plus (B) the Class B-4
Shortfall from the preceding Distribution Date plus (C) the pro rata portion, if
any, of the Subordinated Optimal Principal Amount allocable to the Class B-4
Certificates in accordance with Section 6.01(e) plus (D) any Carry-over
Subordinated Principal Amounts with respect to the Class B-4 Certificates plus
(E) any portion of the Subordinated Optimal Principal Amount allocated to the
Class B-3 Certificates in excess of the Outstanding Certificate Principal
Balance of such Class; and
(5) fifth, to the Class B-5 Certificateholders, up to an
amount equal to (A) the Class B-5 Interest Accrual Amount plus (B) the Class B-5
Shortfall from the preceding Distribution Date plus (C) the pro rata portion, if
any, of the Subordinated Optimal Principal Amount allocable to the Class B-5
Certificates in accordance with Section 6.01(e) plus (D) any Carry-over
Subordinated Principal Amounts with respect to the Class B-5 Certificates plus
(E) any portion of the Subordinated Optimal Principal Amount allocated to the
Class B-4 Certificates in excess of the Outstanding Certificate Principal
Balance of such Class.
(e) On each Distribution Date, the Subordinated Optimal Principal
Amount shall be allocated among the Classes of Subordinated Certificates
entitled, pursuant to the next succeeding sentence, to an allocation of
principal on such Distribution Date, pro rata based upon the Outstanding
Certificate Principal Balances of all such Classes so entitled. With respect to
the Subordinated Certificates, on each Distribution Date, principal shall be
distributable to (1) any Class of Subordinated Certificates which has current
Credit Support (before giving effect to any distribution of principal and any
Realized Losses allocable on such Distribution Date) greater than or equal to
the Original Credit Support for such Class; (2) the Class having the lowest
numerical class designation of any outstanding Class of Subordinated
Certificates which does not meet the criteria in (1) above; and (3) the Class
B-5 Certificates if all other outstanding Classes of Subordinated Certificates
meet the criteria in (1) above or if no other Class of Subordinated Certificates
is outstanding; provided, however, that no Class of Subordinated Certificates
shall receive any distributions of principal if any Class of Subordinated
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Certificates having a lower numerical class designation than such Class fails to
meet the criteria in (1) above. For purposes of this paragraph, the Class M
Certificates shall be deemed to have a lower numerical class designation than
each Class of Class B Certificates.
(f) The Servicer shall make all calculations necessary to make the
distributions described in this Section 6.01. All distributions made to
Certificateholders of any Class on each Distribution Date will be made to the
Certificateholders of the respective Class of record on the next preceding
Record Date, except that the final distribution with respect to each Class shall
be made as provided in the forms of Certificates. All distributions made to
Certificateholders shall be based on the Percentage Interest of the Class
represented by their respective Certificates, and shall be made either by
transfer in immediately available funds to the account of such Holder at a bank
or other financial or depository institution having appropriate facilities
therefor, if such Holder has so notified the Trustee or, if a Paying Agent has
been appointed under Section 4.05, the Paying Agent, in writing at least 10
Business Days prior to the first Distribution Date for which distribution by
wire transfer is to be made and such Holder's Certificates of such Class in the
aggregate evidence an original denomination of not less than $5,000,000 or such
Holder holds a 100% Percentage Interest of such Class or, if not, by check
mailed to the address of the Person entitled thereto as it appears on the
Certificate Register, except that the final distribution in retirement of the
Certificates will be made only upon presentation and surrender of the
Certificates at the office specified in the final Distribution Notice. If on any
Determination Date, the Servicer determines that there are no Mortgage Loans
outstanding and no other funds or assets in the Trust Fund other than the funds
in the Certificate Account, the Trustee or if a Paying Agent has been appointed
under Section 4.05, the Paying Agent shall promptly send the final distribution
notice to each Certificateholder specifying the manner in which the final
distribution will be made.
Section 6.02. Statements to the Certificateholders. (a) Not
later than the second Business Day prior to each Distribution Date, the Servicer
shall send to the Paying Agent and the Trustee the relevant information for
purposes of this Section 6.02. Not later than each Distribution Date, the Paying
Agent shall send to each Certificateholder, the Depositor, the Trustee (if other
than the Paying Agent), the Servicer, any co-trustee and each Rating Agency a
statement setting forth the following information, after giving effect to the
distributions to be made by the Paying Agent pursuant to Section 6.01 on or as
of such Distribution Date:
(i) with respect to each Class of Certificates the amount of
such distribution to Holders of such Class allocable to principal,
including the amounts distributed pursuant to Section 6.01(b)(i)(G);
(ii) with respect to each Class of Certificates the amount of
such distribution to Holders of such Class allocable to interest and
the amount of interest accrued on the Class A-3 Certificates but not
paid;
(iii) the aggregate amount of any Principal Prepayments and
Repurchase Proceeds included in the distributions to
Certificateholders;
(iv) the aggregate amount of any Advances by the Servicer
pursuant to Section 6.03;
(v) the number of Outstanding Mortgage Loans and the Mortgage
Pool Principal Balance as of the close of business as of the end of the
related Principal Prepayment Period;
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(vi) the related amount of the Servicing Fees (as adjusted
pursuant to Section 6.05) retained or withdrawn from the Collection
Account by the Servicer;
(vii) the number and aggregate principal amounts of Mortgage
Loans (A) delinquent (1) one Monthly Payment, (2) two Monthly Payments
and (3) three or more Monthly Payments and (B) in foreclosure, in each
case, as of the end of the related Principal Prepayment Period;
(viii) the number and the principal balance of Mortgage Loans
with respect to any real estate acquired through foreclosure or grant
of a deed in lieu of foreclosure;
(ix) the aggregate amount of all Advances recovered during the
related Due Period;
(x) with respect to the following Distribution Date, the Class
A Percentage, the Class M Percentage, the Class B Percentage, the Class
A Principal Balance, the Class M Principal Balance, the Class B
Principal Balance, the Non-PO Class A Percentage, the Non-PO Class A
Prepayment Percentage, and the level of Credit Support, if any, with
respect to each Class of Subordinated Certificates;
(xi) the aggregate amount of Realized Losses during the
related Due Period and the aggregate amount of Realized Losses since
the Cut-off Date;
(xii) the allocation to each Class of Certificates of any
Realized Losses during the related Due Period;
(xiii) the Outstanding Certificate Principal Balance of each
Class of Certificates after giving effect to the distributions to each
Class on such Distribution Date; and
(xiv) with respect to each Class of Certificates, the amount
of any Compensating Interest Shortfalls on such Distribution Date.
The Paying Agent's responsibility for sending the above
information to the Certificateholders is limited to the availability, timeliness
and accuracy of the information derived from the Servicer.
Upon reasonable advance notice in writing if required by
federal regulation, the Servicer will provide to each Certificateholder which is
a savings and loan association, bank or insurance company certain reports and
access during business hours to information and documentation regarding the
Mortgage Loans sufficient to permit such Certificateholder to comply with
applicable regulations of regulatory authorities with respect to investment in
the Certificates; provided, that the Servicer shall be entitled to be reimbursed
by each such Certificateholder for the Servicer's actual expenses incurred in
providing such reports and access.
(b) The Servicer shall cause to be prepared, and the Servicer
or the Trustee, as required by applicable law, shall file, any and all tax
returns, information statements or other filings required to be delivered to
Certificateholders and any governmental taxing authority pursuant to any
applicable law with respect to the Trust Fund and the transactions contemplated
hereby (the Servicer or the Trustee may, at its option but with the consent of
the other, which consent shall not be unreasonably
68
withheld, appoint an organization which regularly engages in the preparation and
filing of such documents on a continuous basis for profit and which represents
itself to be expert in such matters) and the Servicer shall maintain a record of
the information necessary for the application of Section 860E(e) of the Code and
shall make such information available as required by Section 860D(a)(6) of the
Code; provided, however, that the Servicer shall notify the Trustee of the
Trustee's obligation to make any such filings and that any fees of the
organization appointed as provided above shall be paid by the Servicer; and
provided further that if an organization is employed, as described above, to
prepare and file any such filings, neither the Trustee nor the Servicer shall be
liable for any errors by such organization.
Section 6.03. Advances by the Servicer. If, on any
Determination Date, the Servicer determines that any Monthly Payments due on the
immediately preceding Due Date have not been received, the Servicer shall,
unless it determines in its sole discretion that such amounts will not be
recoverable from Late Collections, Liquidation Proceeds or otherwise, make an
Advance on or before the related Distribution Date in an amount equal to the
amount of such delinquent Monthly Payments, after adjustment of any delinquent
interest payment for the Servicing Fee. For purposes of this Section 6.03, the
delinquent Monthly Payments referred to in the preceding sentence shall be
deemed to include an amount equal to the Monthly Payments that would have been
due on Mortgage Loans which have been foreclosed or otherwise terminated and in
connection with which the Servicer acquired and continues to own the Mortgaged
Properties on behalf of the Certificateholders. If the Servicer makes an
Advance, it shall on or prior to such Distribution Date either (i) deposit in
the Collection Account an amount equal to such Advance, (ii) cause to be made an
appropriate entry in the records of the Collection Account that funds in such
account being held for future distribution or withdrawal have been, as permitted
by this Section 6.03, used by the Servicer to make such Advance or (iii) make
Advances in the form of any combination of clauses (i) and (ii) aggregating the
amount of such Advance. Any funds being held in the Collection Account for
future distribution to Certificateholders and so used pursuant to clause (ii) or
(iii) above shall be replaced by the Servicer from its own funds by deposit into
the Collection Account on or before any subsequent Distribution Date to the
extent that funds in the Collection Account on such Distribution Date shall be
less than the amount of payments required to be made to Certificateholders on
such Distribution Date. Any such Advance shall be included with the distribution
to the Certificateholders on the related Distribution Date. If the Servicer
determines not to make a Nonrecoverable Advance, it shall on the related
Determination Date furnish to the Trustee, any co- trustee, and each Rating
Agency notice of such determination. The Servicer shall be entitled to be
reimbursed from the Collection Account for all Advances and Nonrecoverable
Advances as provided in Section 5.09.
Section 6.04. Allocation of Realized Losses. (a) Prior to each
Determination Date, the Servicer shall determine (i) the total amount of
Realized Losses, if any, incurred during the related Principal Prepayment
Period; (ii) whether and to what extent such Realized Losses constitute Excess
Losses; and (iii) the respective portions of such Realized Losses allocable to
interest and to principal.
(b) The principal portion of any Realized Losses other than
Excess Losses shall be allocated as follows: first, to the Class B-5
Certificates until the Outstanding Certificate Principal Balance of the Class
B-5 Certificates has been reduced to zero; second, to the Class B-4 Certificates
until the Outstanding Certificate Principal Balance of the Class B-4
Certificates has been reduced to zero; third, to Class B-3 Certificates until
the Outstanding Certificate Principal Balance of the Class B-3 Certificates has
been reduced to zero; fourth, to the Class B-2 Certificates until the
Outstanding Certificate Principal Balance of the Class B-2 Certificates has been
reduced to zero; fifth, to the Class
69
B-1 Certificates until the Outstanding Certificate Principal Balance of the
Class B-1 Certificates has been reduced to zero; sixth, to the Class M
Certificates until the Outstanding Certificate Principal Balance of the Class M
Certificates has been reduced to zero; and seventh, to the Non-PO Class A
Certificates on a pro rata basis until the Outstanding Certificate Principal
Balance of the Non-PO Class A Certificates has been reduced to zero; provided,
however, that if a Realized Loss occurs with respect to a Discount Mortgage Loan
(A) the amount of such Realized Loss equal to the product of (i) the amount of
such Realized Loss and (ii) the PO Percentage with respect to such Discount
Mortgage Loan will be allocated to Class A-P Certificates and (B) the remainder
of such Realized Loss will be allocated as described above. The principal
portion of any Excess Losses shall be allocated among all Classes of
Certificates on a pro rata basis; provided, however, that the applicable PO
Percentage of any Excess Losses on the Discount Mortgage Loans shall be
allocated to Class A-P Certificates.
(c) As used herein, an allocation of a Realized Loss on a "pro
rata basis" among two or more specified Classes means an allocation on a pro
rata basis, among the various Classes so specified, to each such Class on the
basis of their Outstanding Certificate Principal Balances (or, in the case of
the Class A-3 Certificates, the lesser of (i) the Original Certificate Principal
Balance of such Certificates and (ii) the Outstanding Certificate Principal
Balance of such Certificates) prior to giving effect to distributions to be made
on such Distribution Date. All Realized Losses and all other losses allocated to
a Class of Certificates hereunder will be allocated among the Certificates of
such Class in proportion to the Percentage Interests evidenced thereby.
(d) In the event that a recovery is made with respect to any
Realized Loss, the amount of such recovery shall be distributed on the next
Distribution Date first to the Class A Certificateholders, up to the amount to
which such Realized Loss was allocated to the Class A Certificateholders; second
to the Class M Certificateholders, up to the amount to which such Realized Loss
was allocated to the Class M Certificateholders; third to the Class B-1
Certificateholders, up to the amount to which such Realized Loss was allocated
to the Class B-1 Certificateholders; fourth to the Class B-2 Certificateholders,
up to the amount to which such Realized Loss was allocated to the Class B- 2
Certificateholders; fifth to the Class B-3 Certificateholders, up to the amount
to which such Realized Loss was allocated to the Class B-3 Certificateholders;
sixth to the Class B-4 Certificateholders, up to the amount to which such
Realized Loss was allocated to the Class B-4 Certificateholders; and seventh to
the Class B-5 Certificateholders, up to the amount to which such Realized Loss
was allocated to the Class B- 5 Certificateholders.
Section 6.05. Compensating Interest; Allocation of Certain
Interest Shortfalls.
(a) Upon a Principal Prepayment of a Mortgage Loan, the
Servicer shall deposit into the Collection Account from its own funds, as a
reduction of its servicing compensation hereunder, an amount, if any, by which
the amount of the interest that would otherwise accrue with respect to such
Mortgage Loan from the date of prepayment to the Due Date in the related Due
Period at the Net Mortgage Rate exceeds the amount of the interest (adjusted to
the Net Mortgage Rate) collected from the Mortgagor with respect to such period
(such amount, "Compensating Interest"); provided, however, that with respect to
any Distribution Date, the Servicer's obligation to deposit any such amount is
limited to an amount equal to the product of (i) one-twelfth of 0.125% and (ii)
the aggregate Scheduled Principal Balance of the Mortgage Loans with respect to
such Distribution Date.
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(b) On any Distribution Date, the excess, if any, of (X)
Compensating Interest with respect to such Distribution Date over (Y) the amount
deposited in the Collection Account pursuant to (a) above for such Distribution
Date shall equal the "Compensating Interest Shortfall" with respect to such
Distribution Date. On any Distribution Date, the Compensating Interest Shortfall
shall be allocated pro rata among the outstanding Classes of Class A, Class M
and Class B Certificates based on the amount of interest to which each such
Class would otherwise be paid on such Distribution Date had there been no such
Compensating Interest Shortfall.
(c) On any Distribution Date, the interest portion of any
Realized Losses ("Realized Loss Interest Shortfall") other than the interest
portion of Excess Losses shall be allocated to the Class of Subordinated
Certificates then outstanding having the highest numerical class designation
(for this purpose, the Class M Certificates shall be deemed to have a lower
numerical class designation than each Class of Class B Certificates) or, if no
Class of Subordinated Certificates is then outstanding, to the Non- PO Class A
Certificates pro rata among the outstanding Classes of Non-PO Class A
Certificates based on the amount of interest to which each such Class would
otherwise be paid (or in the case of the Class A-3 Certificates, added to the
principal balance of such Class, prior to the Class A-3 Accretion Termination
Date) on such Distribution Date had there been no such Realized Loss Interest
Shortfall. On any Distribution Date, the interest portion of any Excess Losses
shall be allocated pro rata among the outstanding Classes of Certificates based
upon the amount of interest to which each such Class would otherwise be paid (or
in the case of the Class A-3 Certificates, added to the principal balance of
such Class, prior to the Class A-3 Accretion Termination Date) on such
Distribution Date had there been no such Excess Losses allocable to interest.
Section 6.06. Subordination. The rights of the Class B
Certificateholders to receive distributions in respect of the Class B
Certificates on any Distribution Date shall be subordinated to the rights of the
Class A and Class M Certificateholders to receive distributions in respect of
the Class A and Class M Certificates. The rights of the Class M
Certificateholders to receive distributions in respect of the Class M
Certificates on any Distribution Date shall be subordinated to the rights of the
Class A Certificateholders to receive distributions in respect of the Class A
Certificates. The rights of the Class B-1 Certificateholders to receive
distributions in respect of the Class B-1 Certificates on any Distribution Date
shall be subordinate to the rights of the Class A and Class M Certificateholders
to receive distributions in respect of such Class A and Class M Certificates.
Each Class of Class B Certificates (other than the Class B-1 Certificates) is
subordinated to the Class A Certificates, the Class M Certificates and each
Class of Class B Certificates having a lower numerical class designation than
such Class of Class B Certificates. The rights of the Servicer, as servicer, to
receive funds from the Collection Account, pursuant to Section 5.09, on account
of the Servicing Fee (except as provided in Section 6.05) in respect of each
Mortgage Loan, assumption fees, late payment charges and other Mortgagor
charges, reimbursement of Advances and expenses or otherwise, shall not be
subordinated to the rights of the Class A, Class M or Class B
Certificateholders. Amounts held by the Servicer or the Trustee for future
distribution to the Class M or Class B Certificateholders, including, without
limitation, in the Collection Account, shall not be distributed in respect of
the Class M or Class B Certificates except in accordance with the terms of this
Agreement. The Class B Certificateholders are deemed to have granted a security
interest in such amounts to the Class A and Class M Certificateholders to secure
the rights of the Class A and Class M Certificateholders to receive
distributions in priority over the Class B Certificateholders. The Class M
Certificateholders are deemed to have granted a security interest in such
amounts to the Class A Certificateholders to secure the rights of the Class A
Certificateholders to receive distributions in priority over the Class A
Certificateholders.
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[END OF ARTICLE VI]
ARTICLE VII
REPORTS TO BE PREPARED BY THE SERVICER
Section 7.01. Servicer Shall Provide Information as Reasonably
Required. The Servicer shall furnish to the Trustee, during the term of this
Agreement, such periodic, special, or other reports or information, whether or
not provided for herein, as shall be necessary, reasonable, or appropriate in
respect to the Trustee, or otherwise in respect to the purposes of this
Agreement, all such reports or information to be as provided by and in
accordance with such applicable instructions and directions as the Trustee may
reasonably require.
Section 7.02. Federal Information Returns and Reports to
Certificateholders.
(a) For federal income tax purposes, the taxable year of the
Trust Fund shall be a calendar year and the Servicer shall maintain or cause the
maintenance of the books of the Trust Fund on the accrual method of accounting.
(b) The Servicer shall prepare and file or cause to be filed
with the Internal Revenue Service federal tax or information returns with
respect to the Trust Fund and the Certificates containing such information and
at the times and in the manner as may be required by the Code or applicable
Treasury regulations, and shall furnish to each Certificateholder at any time
during the calendar year for which such returns or reports are made such
statements or information at the times and in the manner as may be required
thereby. Without limitation on any other requirement of this Section 7.02, the
Servicer shall make available the information necessary for the application of
Section 860E(e) of the Code within 60 days of such request. With respect to the
Class A-R Certificate, the Servicer shall provide such information or cause such
information to be provided to (i) the Internal Revenue Service, (ii) the
transferor of a Class A-R Certificate to a Disqualified Organization and (iii) a
Pass-Thru Entity that holds a Class A-R Certificate with one or more record
holders that are Disqualified Organizations. The Servicer also shall provide or
cause to be provided promptly the above described computation and information
relating to the tax on transfers to Disqualified Organizations within 60 days
after becoming aware of the transfer to a Disqualified Organization. In
addition, except as may be provided in Treasury regulations, any person holding
an interest in a Pass-Thru Entity as a nominee for another will, with respect to
such interest, be treated as a Pass-Thru Entity. In connection with the
foregoing, the Servicer shall provide the name, address and telephone number of
the person who can be contacted to obtain information required to be reported to
the holders of regular interests in the Trust Fund (the "REMIC Reporting Agent")
as required by IRS Form 8811. The Trustee hereby designates Xxxxxx Xxxxxx to
serve as the REMIC Reporting Agent. The Servicer shall indicate the election to
treat the Trust Fund as a REMIC (which election shall apply to the taxable
period ending December 31, 2001 and each calendar year thereafter) in such
manner as the Code or applicable Treasury regulations may prescribe. The Trustee
shall sign all tax and information returns filed pursuant to this Section 7.02
and any other returns as may be required by the Code, and in doing so shall rely
entirely upon, and shall have no liability for information provided by, or
calculations provided by, the Servicer. The Servicer is hereby designated as the
agent of the Holder of the Class A-R Certificate who shall be the "tax matters
person" (within the meaning of Treas. Reg. ss.1.860F-4(d)) for the Trust Fund.
Any Holder of a Class A-R Certificate will by
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acceptance thereof so appoint the Servicer as agent and attorney-in-fact for the
purpose of acting as tax matters person. In the event that the Code or
applicable Treasury regulations prohibit the Trustee from signing tax or
information returns or other statements, or the Servicer from acting as tax
matters person (as an agent or otherwise), the Trustee or the Servicer, as the
case may be, shall take whatever action that in its sole good faith judgment is
necessary for the proper filing of such information returns or for the provision
of a tax matters person, including designation of the Holder of a Class A-R
Certificate to sign such returns or act as tax matters person. Each Holder of a
Class A-R Certificate shall be bound by this Section 7.02 by virtue of its
acceptance of a Class A-R Certificate.
[END OF ARTICLE VII]
ARTICLE VIII
THE DEPOSITOR AND THE SERVICER
Section 8.01. Indemnification; Third Party Claims. The
Servicer agrees to indemnify the Depositor and the Trustee and hold the
Depositor and the Trustee, their officers, directors, employees and agents
harmless against any and all claims, losses, penalties, fines, forfeitures,
legal fees and related costs, judgments, and any other costs, fees and expenses
that the Depositor or the Trustee may sustain in any way related to failure of
the Servicer to perform its duties and service the Mortgage Loans in compliance
with the terms of this Agreement; provided that no such indemnification shall be
required with respect to acts of a prior Servicer. The Servicer shall
immediately notify the Depositor and the Trustee if a claim is made by a third
party with respect to this Agreement or the Mortgage Loans, assume (with the
consent of the Depositor and the Trustee) the defense of any such claim and pay
all expenses in connection therewith, including counsel fees, and promptly pay,
discharge and satisfy any judgment or decree which may be entered against it,
the Depositor or the Trustee in respect of such claim. This right to
indemnification shall survive the termination of this Agreement.
Section 8.02. Merger or Consolidation of the Depositor or the
Servicer. The Depositor and the Servicer will each keep in full effect its
existence, rights and franchises as a corporation, and will obtain and preserve
its qualification to do business as a foreign corporation in each jurisdiction
in which such qualification is or shall be necessary to protect the validity and
enforceability of this Agreement, the Certificates or any of the Mortgage Loans
and to perform its duties under this Agreement. The Servicer will not sell all
or substantially all of its assets without the prior written consent of the
Depositor and the Trustee.
Any person into which the Depositor or the Servicer may be
merged or consolidated, or to whom the Depositor or the Servicer has sold
substantially all of its assets, or any corporation resulting from any merger,
conversion or consolidation to which the Depositor or the Servicer shall be a
party, or any Person succeeding to the business of the Depositor or the
Servicer, shall be the successor of the Depositor or the Servicer hereunder,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto, anything herein to the contrary notwithstanding;
provided, however, that the successor or surviving Person to the Servicer shall
satisfy the requirements of Section 8.05 with respect to the qualifications of a
successor to the Servicer.
Notwithstanding anything else in this Section 8.02 and Section
8.04 to the contrary, the Servicer may assign its rights and delegate its duties
and obligations under this Agreement; provided that
73
the Person accepting such assignment or delegation shall be a Person which is
qualified to service mortgage loans on behalf of FNMA or FHLMC, is approved in
advance in writing by the Trustee and the Depositor, is willing to service the
Mortgage Loans and executes and delivers to the Depositor and the Trustee an
agreement, in form and substance reasonably satisfactory to the Depositor and
the Trustee, which contains an assumption by such Person of the due and punctual
performance and observance of each covenant and condition to be performed or
observed by the Servicer under this Agreement; provided further that each Rating
Agency's rating of any of the Classes of Certificates that have been rated in
effect immediately prior to such assignment and delegation will not be qualified
or reduced or withdrawn as a result of such assignment and delegation. In the
case of any such assignment and delegation, the Servicer shall be released from
its obligations as Servicer under this Agreement, except that the Servicer shall
remain liable for all liabilities and obligations incurred by it as Servicer
hereunder prior to the satisfaction of the conditions to such assignment and
delegation set forth in the next preceding sentence.
Section 8.03. Limitation on Liability of the Depositor, the
Servicer, the Trustee and Others. Neither the Depositor, the Servicer nor any of
the directors, officers, employees or agents of the Depositor or the Servicer
shall be under any liability to the Trustee or the Certificateholders for any
action taken, or for refraining from the taking of any action, in good faith
pursuant to this Agreement, or for errors in judgment; provided, however, that
this provision shall not protect the Depositor or the Servicer against any
breach of warranties or representations made herein, or failure to perform its
obligations in strict compliance with this Agreement, or any liability which
would otherwise be imposed by reason of any breach of the terms and conditions
of this Agreement. The Depositor, the Servicer, the Trustee, and any director,
officer, employee or agent of the Depositor, the Servicer or the Trustee 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. Neither the
Depositor, the Trustee nor the Servicer shall be under any obligation to appear
in, prosecute or defend any legal action which is not incidental to its
respective duties to service the Mortgage Loans in accordance with this
Agreement and which in its opinion may cause it to incur any expenses or
liability; provided, however, that the Depositor, the Trustee or the Servicer
may in its discretion (and, in the case of the Depositor or the Servicer, with
the consent of the Trustee, which consent shall not be unreasonably withheld)
undertake any such action which it may deem necessary or desirable with respect
to this Agreement and the rights and duties of the parties hereto. In such
event, the legal expenses and costs of such action and any liability resulting
therefrom shall be expenses, costs and liabilities payable from the Collection
Account and the Depositor, the Servicer or the Trustee shall be entitled to be
reimbursed therefor out of the Collection Account as provided by Section 4.06;
provided that no such right of reimbursement shall exist with respect to the
Servicer when such claim relates to the failure of the Servicer to service the
Mortgage Loans in strict compliance with the terms of this Agreement or to a
breach of a representation or warranty made by the Servicer hereunder.
Section 8.04. Depositor and Servicer Not to Resign. Except as
described in Section 8.02, neither the Depositor nor the Servicer shall assign
this Agreement or resign from the obligations and duties hereby imposed on it
except by mutual consent of the Depositor, the Servicer and all of the
Certificateholders unless the determination is made that its duties hereunder
are no longer permissible under applicable law and such incapacity cannot be
cured by the Depositor or the Servicer. Any such determination permitting the
resignation of the Depositor or the Servicer shall be evidenced by an opinion of
independent counsel to such effect delivered to the Trustee which opinion of
counsel shall be in form and substance acceptable to the Trustee. Upon any such
assignment or resignation, the Depositor or the Servicer, as appropriate, shall
send notice to all Certificateholders of the effect of such assignment or
resignation upon the then current rating of the Class of Certificates by each
Rating Agency whose
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rating on such Class is then in effect. No such resignation shall become
effective until a successor shall have assumed the Depositor's or the Servicer's
responsibilities and obligations hereunder in the manner provided in Section
8.05. Any purported assignment or resignation which does not comply with the
requirements of this Section shall be of no effect.
Section 8.05. Successor to the Servicer. In connection with
the termination of the Servicer's responsibilities and duties under this
Agreement pursuant to Section 8.04 or 9.01, the Trustee shall succeed to and
assume all of the Servicer's responsibilities, rights, duties and obligations as
Servicer (but not in any other capacity) under this Agreement (except that the
Trustee shall not be obligated to make Advances if prohibited by applicable law
nor to effectuate repurchases or substitutions of Mortgage Loans pursuant to
Section 2.02 and except that the Trustee makes no representations and warranties
pursuant to Sections 3.01 and 3.02). Prior to the termination of the Servicer's
responsibilities, duties and liabilities under this Agreement, the Trustee may
appoint a successor having a net worth of not less than $15,000,000 and which is
a FNMA or FHLMC approved seller/servicer in good standing and which shall
succeed to all rights and assume all of the responsibilities, duties and
liabilities of the Servicer under this Agreement, except as aforesaid, if the
Trustee receives a letter from each Rating Agency that such appointment would
not result in a reduction or withdrawal of the current rating of any Class of
Certificates that is rated by a Rating Agency. Any co-trustee appointed pursuant
to Section 10.10 for purposes of this Section 8.05 shall have an obligation to
make Advances pursuant to Section 6.03 during such time as the Trustee is the
Servicer, which obligation shall be joint and several with that of the Trustee
as Servicer. If the Trustee has become the successor to the Servicer in
accordance with this Section or Section 9.03, then notwithstanding the above,
the Trustee may, if it shall be unwilling to so act, or shall, if it is unable
to so act, appoint, or petition a court of competent jurisdiction to appoint,
any established housing and home finance institution having a net worth of not
less than $15,000,000 and which is a FNMA or FHLMC approved seller/servicer in
good standing as the successor to the Servicer hereunder in the assumption of
all of the responsibilities, duties or liabilities of the Servicer hereunder. In
connection with any such appointment and assumption, the Trustee may make such
arrangements for the compensation of such successor out of payments on Mortgage
Loans as it and such successor shall agree or such court shall determine;
provided, however, that no such compensation shall be in excess of that
permitted under this Agreement without the consent of all of the
Certificateholders. If the Servicer's duties, responsibilities and liabilities
under this Agreement should be terminated pursuant to Section 8.02, 8.04 or
9.01, the Servicer shall discharge such duties and responsibilities during the
period from the date it acquires knowledge of such termination until the
effective date thereof with the same degree of diligence and prudence which it
is obligated to exercise under this Agreement, and shall take no action
whatsoever that might impair or prejudice the rights or financial condition of
its successor or the Trust Fund. The resignation or removal of the Servicer
pursuant to Section 8.02, 8.04 or 9.01 shall not become effective until a
successor shall be appointed pursuant to this Section and shall in no event
relieve the Servicer of liability for breach of the representations and
warranties made pursuant to Section 3.03.
Any successor appointed as provided herein shall execute,
acknowledge and deliver to the Servicer and to the Trustee an instrument
accepting such appointment, whereupon such successor shall become fully vested
with all the rights, powers, duties, responsibilities, obligations and
liabilities of the Servicer, with like effect as if originally named as a party
to this Agreement and the Certificates. Any termination or resignation of the
Servicer or this Agreement pursuant to Section 8.02, 8.04, 9.01 or 11.01 shall
not affect any claims that the Trustee may have against the Servicer for events
or actions taken or not taken by the Servicer arising prior to any such
termination or resignation.
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The Servicer shall timely deliver to the successor the funds
that were, or were required to be, in the Collection Account and the Escrow
Account, if any, and all Mortgage Files and related documents, statements and
recordkeeping held by it hereunder and the Servicer shall account for all funds
and shall execute and deliver such instruments and do such other things as may
reasonably be required to more fully and definitely vest and confirm in the
successor all such rights, powers, duties, responsibilities, obligations and
liabilities of the Servicer.
Upon a successor's acceptance of appointment as such, the
Servicer shall notify, in writing, the Trustee, the Certificateholders and each
Rating Agency of such appointment.
Section 8.06. Maintenance of Ratings. The Servicer shall
cooperate with the Depositor and take any action that may be reasonably
necessary to maintain the current rating or ratings on the Certificates.
[END OF ARTICLE VIII]
ARTICLE IX
DEFAULT
Section 9.01. Events of Default. If one or more of the
following Events of Default shall occur and be continuing, that is to say:
(i) any failure by the Servicer to remit any payment required
to be made or distributed under the terms of this Agreement which
continues unremedied for a period of three Business Days after the date
upon which written notice of such failure, requiring the same to be
remedied, shall have been given to the Servicer by the Trustee or the
Depositor or to the Servicer, the Trustee and the Depositor by the
Holders of Certificates of any Class evidencing, as to such Class,
Percentage Interests aggregating not less than 25%; or
(ii) a breach by the Servicer in a material respect of any
representation or warranty set forth in Section 3.02, or failure on the
part of the Servicer duly to observe or perform in any material respect
any other of the covenants or agreements on the part of the Servicer
set forth in this Agreement, which continues unremedied for a period of
60 days after the date on which written notice of such breach or
failure, requiring the same to be remedied, shall have been given to
the Servicer by the Trustee or the Depositor or to the Servicer, the
Trustee and the Depositor by the Holders of Certificates of any Class
evidencing, as to such Class, Percentage Interests aggregating not less
than 25%; or
(iii) the Servicer shall notify the Trustee in writing that it
is unable to make an Advance required to be made in accordance with
Section 6.03; or;
(iv) a decree or order of a court or agency or supervisory
authority having jurisdiction for the appointment of a conservator or
receiver or liquidator in any insolvency, readjustment of debt,
marshalling of assets and liabilities or similar proceedings, or for
the winding-up or liquidation of its affairs, shall have been entered
against the Servicer and such decree or order shall have remained in
force undischarged or unstayed for a period of 60 days; or
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(v) the Servicer shall consent to the appointment of a
conservator or receiver or liquidator in any insolvency, readjustment
of debt, marshalling of assets and liabilities or similar proceedings
of or relating to the Servicer or of or relating to all or
substantially all of the Servicer's property; or
(vi) 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.
then, and in each and every such case, so long as an Event of Default shall not
have been remedied, the Trustee shall notify the Certificateholders, and each
Rating Agency of such Event of Default. The Trustee may, and at the written
direction of the Holders of Certificates evidencing Percentage Interests
aggregating more than 50%, shall, by notice in writing to the Servicer,
terminate all the rights and obligations of the Servicer under this Agreement
and in and to the Mortgage Loans and the proceeds thereof. On or after the
receipt by the Servicer of such written notice, all authority and power of the
Servicer under this Agreement, whether with respect to the Mortgage Loans or
otherwise, shall pass to and be vested in the successor appointed pursuant to
Section 8.05. Upon written request from the Trustee, the Servicer shall prepare,
execute and deliver, any and all documents and other instruments, place in such
successor's possession all Mortgage Files, and do or accomplish all other acts
or things necessary or appropriate to effect the purposes of such notice of
termination, whether to complete the transfer and endorsement or assignment of
the Mortgage Loans and related documents, or otherwise, at the Servicer's sole
expense. The Servicer agrees to cooperate with the Trustee and any co-trustee in
effecting the termination of the Servicer's responsibilities and rights
hereunder, including, without limitation, the transfer to such successor for
administration by it of all cash amounts which shall at the time be credited or
should have been credited by the Servicer to the Collection Account or Escrow
Account or thereafter received with respect to the Mortgage Loans. The Trustee
will have no obligation to take any action or institute, conduct or defend any
litigation under this Agreement at the request, order or direction of any of the
Holders of Certificates unless such Certificateholders have offered to the
Trustee reasonable security or indemnity against the costs, expenses and
liabilities which the Trustee may incur.
Section 9.02. Waiver of Defaults. The Trustee may waive any
default by the Servicer in the performance of its obligations hereunder and its
consequences, except that a default in the making of any required distribution
on any of the Certificates may only be waived by the holders of a majority of
the Percentage Interests of the affected Certificateholders. Upon any such
waiver of a past default, such default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been remedied for every
purpose of this Agreement. No such waiver shall extend to any subsequent or
other default or impair any right consequent thereon except to the extent
expressly so waived.
Section 9.03. Trustee to Act; Appointment of Successor. On and
after the time the Servicer receives a notice of termination pursuant to Section
9.01, the Trustee or its appointed agent shall be the successor in all respects
to the Servicer to the extent provided in Section 8.05.
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Section 9.04. Notification to Certificateholders and the
Rating Agencies.
(a) Upon any such termination pursuant to Section 9.01, the
Trustee shall give prompt written notice thereof to Certificateholders at their
respective addresses appearing in the Certificate Register and to each Rating
Agency.
(b) Within 60 days of a Responsible Officer of the Trustee
having received written notice of the occurrence of any Event of Default, the
Trustee shall transmit by mail to all Holders of Certificates notice of each
such Event of Default hereunder known to the Trustee, unless such Event of
Default shall have been cured or waived.
[END OF ARTICLE IX]
ARTICLE X
CONCERNING THE TRUSTEE
Section 10.01. Duties of Trustee. The Trustee, prior to the
occurrence of an Event of Default and after the curing of all Events of Default
which may have occurred, undertakes to, and is empowered to, perform such duties
and only such duties as are specifically set forth in this Agreement. Any
permissive right of the Trustee as enumerated in this Agreement shall not be
construed as a duty; provided that in case an Event of Default has occurred
(which has not been cured), 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 man would exercise or use under the circumstances
in the conduct of such man's own affairs.
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 willful misconduct, and, if the Trustee is acting as
the successor Servicer pursuant to Section 8.05 or 9.03, its own willful
misconduct with respect to its servicing obligations; provided, however, that:
(i) Prior to the occurrence of an Event of Default, and after
the curing of all such Events of Default 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 to the requirements of
this Agreement;
(ii) The Trustee shall not be liable for an error of judgment
made in good faith by a Responsible Officer or Responsible Officers of
the Trustee, unless it shall be proved that the Trustee was negligent
in ascertaining the pertinent facts; and
(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 Certificateholders of any Class
holding Certificates which evidence, as to such Class, Percentage
Interests aggregating not less than 25% as to the time, method and
place of conducting any proceeding for any remedy
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available to the Trustee, or exercising any trust or power conferred
upon the Trustee, under this Agreement.
Section 10.02. Certain Matters Affecting the Trustee. Except
as otherwise provided in Section 10.01:
(a) The Trustee may rely upon and shall be protected in acting
or refraining from acting upon any resolution, Officers' Certificate,
certificate of auditors or any other certificate, statement, instrument,
opinion, report, notice, request, consent, order, appraisal, bond or other paper
or document believed by it to be genuine and to have been signed or presented by
the proper party or parties;
(b) 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;
(c) The Trustee shall be under no obligation to exercise any
of the trusts or powers vested in it by this Agreement or to institute, conduct
or defend any litigation hereunder or in relation hereto at the request, order
or direction of any of the Certificateholders, pursuant to the provisions of
this Agreement, unless such Certificateholders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and liabilities
which may be incurred therein or thereby; nothing contained herein shall,
however, relieve the Trustee of the obligation, upon the occurrence of an Event
of Default (which has not been cured), to exercise such of the rights and powers
vested in it by this Agreement, and to use the same degree of care and skill in
their exercise as a prudent man would exercise or use under the circumstances in
the conduct of such man's own affairs;
(d) Neither the Trustee nor any of its directors, officers,
employees or agents shall be personally liable for any action taken, suffered or
omitted by it in good faith and believed by it or any of them to be authorized
or within the discretion or rights or powers conferred upon the Trustee by this
Agreement;
(e) Prior to the occurrence of an Event of Default hereunder
and after the curing of all Events of Default 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 document,
unless requested in writing to do so by Holders of Certificates of any Class
evidencing, as to such Class, Percentage Interests aggregating not less than 25%
(in the case of conflicting requests by two or more 25% or greater Percentage
Interests, the Trustee shall act in accordance with the first such request);
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 expense or liability
as a condition to such proceeding. The reasonable expense of every such
examination shall be paid by the Servicer, if an Event of Default shall have
occurred and is continuing, and otherwise by the Certificateholder requesting
the investigation;
(f) The Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents, subcontractors or attorneys; and
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(g) Nothing in this Agreement shall be construed to require
the Trustee (acting in its capacity as Trustee) to expend its own funds.
Section 10.03. Trustee Not Liable for Certificates or Mortgage
Loans. The recitals contained herein and in the Certificates (other than the
authentication of the Certificates by an authorized signatory of the Trustee)
shall be taken as the statements of the Depositor or the Servicer, as the case
may be, and the Trustee assumes no responsibility for their correctness. The
Trustee makes no representations or warranties as to the validity or sufficiency
of this Agreement or of the Certificates (except that (except as set forth
herein) the Certificates shall be duly and validly executed and authenticated by
it) or of any Mortgage Loan or related document. The Trustee shall not be
accountable for the use or application by the Depositor or the Servicer of any
of the Certificates or of the proceeds of such Certificates, or for the use or
application of any funds paid to the Depositor or the Servicer in respect of the
Mortgage Loans or deposited in or withdrawn from the Collection Account by the
Depositor or the Servicer. The Trustee, in its capacity as trustee hereunder,
shall have no responsibility for the timeliness or the amount of payments made
by the Paying Agent to the Certificateholders.
Section 10.04. 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 it would have if it were not Trustee.
Section 10.05. Fees and Expenses. The Servicer covenants and
agrees to pay to the Trustee from time to time, and the Trustee shall be
entitled to, 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 trust hereby created and
in the exercise and performance of any of the powers and duties hereunder of the
Trustee, and the Servicer 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, and the expenses incurred by the
Trustee in connection with the appointment of an office or agency pursuant to
Section 10.11) except any such expense, disbursement or advance as may arise
from its negligence or bad faith. Notwithstanding anything to the contrary in
this Agreement, this Section shall survive the termination of this Agreement.
Section 10.06. Eligibility Requirements for Trustee. The
Trustee hereunder shall at all times be an entity having its principal office in
a state and city acceptable to the Depositor and organized and doing business
under the laws of such state or the United States of America, authorized under
such laws to exercise corporate trust powers, having a combined capital and
surplus of at least $50,000,000 and subject to supervision or examination by
federal or state authority. The Trustee shall not be an affiliate of either
Seller or the Depositor. 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, the combined capital
and surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. In
case at any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section, the Trustee shall resign immediately in the manner
and with the effect specified in Section 10.07.
Section 10.07. Resignation and Removal of the Trustee. The
Trustee, and any co- trustee may at any time resign and be discharged from the
trusts hereby created by giving written notice
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thereof to the Depositor, the Servicer and each Rating Agency. Upon receiving
such notice of resignation, the Depositor shall promptly appoint a successor
trustee or co-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; provided that such appointment does not result in a reduction
or withdrawal of the rating of any of the Classes of Certificates that have been
rated. If no successor trustee shall have been so appointed and have accepted
appointment within 30 days after the giving of such notice of resignation, the
resigning Trustee may petition any court of competent jurisdiction for the
appointment of a successor trustee.
If at any time, the Trustee shall cease to be eligible in
accordance with the provisions of Section 10.06 and shall fail to resign after
written request therefor by the Depositor, or if at any time the Trustee shall
become incapable of acting, or shall be adjudged 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 and 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 Holders of Certificates evidencing in the aggregate more
than 50% of Percentage Interest may at any time remove the Trustee and appoint a
successor trustee by written instrument or instruments, in triplicate, signed by
such Holders or their attorneys-in-fact duly authorized, one complete set of
which instruments shall be delivered to the Depositor, one complete set to the
Trustee so removed and one complete set to the successor so appointed.
Any resignation or removal of the Trustee or any resignation
of any co-trustee and appointment of a successor trustee or co-trustee pursuant
to any of the provisions of this Section shall become effective upon acceptance
of appointment by the successor trustee as provided in Section 10.08, or upon
acceptance of appointment by a co-trustee, as applicable, unless with respect to
a co-trustee, the Trustee receives written notice from each Rating Agency that
the failure to appoint a successor co-trustee would not result in a withdrawal
or reduction of the rating of any of the Classes of Certificates that have been
rated, in which case the resignation of any co-trustee shall be effective upon
receipt of such written notice. Any co-trustee may not be removed unless the
Depositor and the Trustee each receive written notice from each Rating Agency
that such removal would not result in a withdrawal or reduction of the rating of
any of the Classes of Certificates that have been rated, in which case the
removal of any co- trustee shall be effective upon receipt of such written
notice.
Section 10.08. Successor Trustee. Any successor trustee
appointed as provided in Section 10.07 shall execute, acknowledge and deliver to
the Depositor 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 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 the like effect as if originally
named as trustee herein. The predecessor trustee shall deliver to the successor
trustee all Mortgage Files and related documents and statements held by it
hereunder, and 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 more fully and certainly vesting and confirming in the successor
trustee all such rights, powers, duties and obligations.
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No successor trustee shall accept appointment as provided in
this Section unless at the time of such acceptance such successor trustee shall
be eligible under the provisions of Section 10.06. Prior to the appointment of
any successor trustee becoming effective, the Depositor shall have received from
each Rating Agency written confirmation that such appointment would not result
in a reduction of the rating of the Class A or Class M Certificates.
Upon acceptance of appointment by a successor trustee as
provided in this Section, the Depositor shall mail notice of the succession of
such trustee hereunder to all Holders of Certificates at their addresses as
shown in the Certificate Register, to the Servicer, any Sub-Servicer and to each
Rating Agency. If the Depositor fails to mail such notice within 10 days after
acceptance of appointment by the successor trustee, the successor trustee shall
cause such notice to be mailed at the expense of the Depositor.
Section 10.09. 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 corporation shall be eligible under the provisions of Section
10.06, without the execution or filing of any paper or any further act on the
part of any of the parties hereto, anything herein to the contrary
notwithstanding.
Section 10.10. Appointment of Co-Trustee or Separate Trustee.
At any time, for the purpose of meeting any legal requirements of any
jurisdiction in which any part of the Trust Fund or property securing the same
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, of any part of the Trust Fund, and to vest in such
Person or Persons, in such capacity, such title to the Trust Fund, or any part
thereof, and, subject to the other provisions of this Section 10.10, such
powers, duties, obligations, rights and trusts as the Depositor and the Trustee
may consider necessary or desirable. If the Depositor shall not have joined in
such appointment within 15 days after the receipt by it of a request so to do,
or in case an Event of Default 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 10.06, hereunder, and no notice to Holders of
Certificates of the appointment of co-trustee(s) or separate trustee(s) shall be
required under Section 10.08 hereof.
In the case of any appointment of a co-trustee or separate
trustee pursuant to this Section 10.10, all rights, powers, duties and
obligations conferred or imposed upon the Trustee shall be conferred or imposed
upon and exercised or performed by the Trustee and such separate trustee or
co-trustee jointly and severally, 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 Fund or any portion thereof in any such jurisdiction) shall be exercised
and performed by such separate trustee or co-trustee at the direction of the
Trustee.
Every instrument appointing any separate trustee or co-trustee
shall refer to this Agreement and the conditions of this Article X. 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
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appointment, either jointly with the Trustee or separately, as may be provided
therein, subject to all the provisions of this Agreement, specifically including
every provision of this Agreement relating to the conduct of, affecting the
liability of, or affording protection to, the Trustee. Every such instrument
shall be filed with the Trustee.
Any separate trustee or co-trustee may, at any time,
constitute the Trustee, its agent or attorney-in-fact, with full power and
authority, to the extent not prohibited by law, to do any lawful act under or in
respect of this Agreement on its behalf and in its name.
Section 10.11. Appointment of Office or Agency. The Trustee
may appoint an office or agency in The City of New York where Certificates may
be surrendered for registration of transfer or exchange. The Trustee will
maintain an office at the address stated in Section 12.07 hereof where notices
and demands to or upon the Trustee in respect of the Certificates may be served.
[END OF ARTICLE X]
ARTICLE XI
TERMINATION
Section 11.01. Termination. The respective obligations and
responsibilities of the Depositor, the Servicer (except the duty to pay the
Trustee's fees and expenses and indemnification hereunder) and the Trustee shall
terminate upon (i) the later of the final payment or other liquidation (or any
Advance with respect thereto) of the last Mortgage Loan or the disposition of
all property acquired upon foreclosure or deed in lieu of foreclosure of any
Mortgage Loan and the remittance of all funds due hereunder; or (ii) at the
option of the Servicer, on any Distribution Date which occurs in the month next
following a Due Date on which the aggregate unpaid Principal Balance of all
Outstanding Mortgage Loans is less than 10% of the aggregate unpaid Principal
Balance of the Mortgage Loans on the Cut-off Date, so long as the Servicer
deposits or causes to be deposited in the Collection Account during the
Principal Prepayment Period related to such Distribution Date (and provides
notice to the Trustee of its intention to so deposit on or before the 20th day
of such Principal Prepayment Period) an amount equal to the greater of (A) the
Purchase Price for each Outstanding Mortgage Loan, less any unreimbursed
Advances made with respect to any Mortgage Loan (which amount shall offset
completely any unreimbursed Advances for which the Servicer is otherwise
entitled to reimbursement), and, with respect to all property acquired in
respect of any Mortgage Loan remaining in the Trust Fund, an amount equal to the
fair market value of such property, as determined by an appraisal to be
conducted by an appraiser selected by the Trustee, less unreimbursed Advances
made with respect to any Mortgage Loan with respect to which property has been
acquired and (B) the aggregate Outstanding Certificate Principal Balance of the
Class A, Class M, Class B-1 and Class B-2 Certificates, plus any accrued and
unpaid interest thereon at the Remittance Rate; provided, however, that 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. James's, living on the
date hereof. Notwithstanding the foregoing, a termination may be effected by the
making of such optional repurchases only if the termination of the Trust Fund
satisfies the requirement for a "qualified liquidation" of the Trust Fund within
the meaning of Section 860F(a)(4) of the Code and that the purchases of the
Outstanding Mortgage Loans pursuant to the Section 11.01 will not constitute
"prohibited transactions" within the meaning of Section 860F(a)(2) of the Code.
83
Notice of any termination, specifying the Distribution Date
upon which all Certificateholders may surrender their Certificates to the
Trustee or, if a Paying Agent has been appointed pursuant to Section 4.05, the
Paying Agent for payment and cancellation, shall be given promptly by the
Trustee or, if a Paying Agent has been appointed under Section 4.05, the Paying
Agent, (upon direction by the Depositor 10 days prior to the date such notice is
to be mailed) by signed letter to Certificateholders and each Rating Agency
mailed no later than the 25th day of the month preceding the month of such final
distribution specifying (i) the Distribution Date upon which final payment on
the Certificates will be made upon presentation and surrender of Certificates at
the office or agency of the Trustee or, if a Paying Agent has been appointed
under Section 4.05, the Paying Agent, therein designated and (ii) that the
Record Date otherwise applicable to such Distribution Date is not applicable,
payments being made only upon presentation and surrender of the Certificates at
the office or agency of the Trustee or, if a Paying Agent has been appointed
under Section 4.05, the Paying Agent, therein specified. The Servicer shall
indicate the date of adoption of the plan of qualified liquidation in a
statement attached to the final federal income tax return of the Trust Fund.
After giving such notice, the Trustee, or if a Paying Agent has been appointed
under Section 4.05, the Paying Agent shall not register the transfer or exchange
of any Certificates. If such notice is given in connection with the Servicer's
election to purchase the Outstanding Mortgage Loans, the Servicer shall deposit
in the Collection Account after adoption of the plan during the applicable
Principal Prepayment Period an amount equal to the purchase price as determined
as provided in clause (ii) of the preceding paragraph and on the Distribution
Date on which such termination is to occur, Certificateholders will be entitled
to the amount of such purchase price but not amounts in excess thereof, all as
provided herein. Upon presentation and surrender of the Certificates, the
Trustee or, if a Paying Agent has been appointed under Section 4.05, the Paying
Agent, shall notify the Servicer and the Servicer shall cause to be distributed
to Certificateholders an amount equal to (a) the amount otherwise distributable
on such Distribution Date, if not in connection with a purchase; or (b) if the
Servicer elected to so purchase, the purchase price determined as provided in
clause (ii) of the preceding paragraph. Following such final deposit the Trustee
shall promptly release to the Servicer the Mortgage Files for the remaining
Mortgage Loans, and the Trustee shall execute all assignments, endorsements and
other instruments necessary to effectuate such transfer and shall have no
further responsibility with regard to said Mortgage Files.
If all of the Certificateholders shall not surrender their
Certificates for cancellation within three months after the time specified in
the above-mentioned written notice, at the close of the 90 day period beginning
after the written notice is given, each remaining Certificateholder will be
credited with an amount that would have been otherwise distributed to such
Certificateholder, and the Trustee or, if a Paying Agent has been appointed
under Section 4.05, the Paying Agent, 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 three months
after the second notice all the Certificates shall not have been surrendered for
cancellation, the Trustee or, if a Paying Agent has been appointed under Section
4.05, the Paying Agent, shall appoint an agent to take appropriate and
reasonable steps to contact the remaining Certificateholders concerning
surrender of their Certificates, and the cost thereof shall be paid out of the
funds and other assets which remain in the Trust Fund hereunder.
[END OF ARTICLE XI]
84
ARTICLE XII
MISCELLANEOUS PROVISIONS
Section 12.01. Severability of Provisions. If any one or more
of the covenants, agreements, provisions or terms of this Agreement shall be for
any reason whatsoever held invalid, then such covenants, agreements, provisions
or terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement.
Section 12.02. Limitation on Rights of Certificateholders. The
death or incapacity of any Certificateholder shall not operate to terminate this
Agreement or the Trust Fund, nor entitle such Certificateholder's legal
representatives or heirs to claim an accounting or to take any action or
proceeding in any court for a partition or winding-up of the Trust Fund, nor
otherwise affect the rights, obligations and liabilities of the parties hereto
or any of them.
No Certificateholder shall have any right to vote (except as
expressly provided herein) or in any manner otherwise control the operation and
management of the Trust Fund, or the obligations of the parties hereto, nor
shall anything herein set forth, or contained in the terms of the Certificates,
be construed so as to constitute the Certificateholders from time to time as
partners or members of an association; nor shall any Certificateholder be under
any liability to any third person by reason of any action taken by the parties
to this Agreement pursuant to any provision hereof.
No Certificateholder shall have any right by virtue of any
provision of this Agreement to institute any suit, action or proceeding in
equity or at law upon or under or with respect to this Agreement, unless such
Holder previously shall have given to the Trustee a written notice of default
and of the continuance thereof, as hereinbefore provided, and the Holders of
Certificates of any Class evidencing in the aggregate not less than 25% of the
Percentage Interests of such Class shall have made written request upon the
Trustee to institute such action, suit or proceeding in its own name as Trustee
hereunder (in the case of conflicting requests by two or more 25% or greater
Percentage Interests, the Trustee shall act in accordance with the first such
request) 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 60 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 being understood and intended, and being
expressly covenanted by each Certificateholder with every other
Certificateholder and the Trustee, that no one or more Holders of Certificates
of any Class 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 of such Class or any other Class, or
to obtain or seek to obtain priority over or preference to any other such
Holder, or to enforce any right under this Agreement, except in the manner
herein provided and for the common benefit of Certificateholders of such Class
or all Classes, as the case may be. For the protection and enforcement of the
provisions of this Section, each and every Certificateholder and the Trustee
shall be entitled to such relief as can be given either at law or in equity.
Section 12.03. Amendment. This Agreement may be amended from
time to time by the Depositor, the Servicer and the Trustee, without the consent
of any of the Certificateholders, to cure any ambiguity, to correct or
supplement any provisions herein which may be inconsistent with any other
85
provisions herein, to ensure continuing treatment of the Trust Fund as a REMIC
to avoid or minimize the risk of imposition of any tax on the Trust Fund
pursuant to the Code, or to make any other provisions with respect to matters or
questions arising under this Agreement which shall not be materially
inconsistent with the provisions of this Agreement, provided that such actions
shall not, as evidenced by an Opinion of Counsel, adversely affect in any
material respect the interests of any Certificateholder of a Class having an
Outstanding Certificate Principal Balance of greater than zero or cause the
Trust Fund to fail to qualify as a REMIC.
This Agreement may also be amended from time to time by the
Depositor, the Servicer and the Trustee with the consent of the Holders of
Certificates evidencing in the aggregate not less than 66-2/3% of the Percentage
Interest of each Class of Certificates having an Outstanding Certificate
Principal Balance greater than zero and affected thereby for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of this Agreement or of modifying in any manner the rights of the
Holders of Certificates of such Class; provided, however, that no such amendment
shall (i) reduce in any manner the amount of, or delay the timing of, payments
received on Mortgage Loans which are required to be distributed on any
Certificate without the consent of the Holder of such Certificate, (ii) reduce
the aforesaid percentage of Certificates of any class the Holders of which are
required to consent to any such amendment or (iii) change the percentage
specified in clause (ii) of the first paragraph of Section 11.01, without the
consent of the Holders of all Certificates of such Class then outstanding.
Promptly after the execution of any such amendment the Trustee
shall furnish written notification of the substance of such amendment to each
Certificateholder and each Rating Agency.
It shall not be necessary for the consent of
Certificateholders under this Section 12.03 to approve the particular form of
any proposed amendment but it shall be sufficient if such consent shall approve
the substance thereof. The manner of obtaining such consents and of evidencing
the authorization of the execution thereof by Certificateholders shall be
subject to such reasonable regulations as the Trustee may prescribe.
Section 12.04. Counterparts. This Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute but one and
the same instrument.
Section 12.05. Duration of Agreement. This Agreement shall
continue in existence and effect until terminated as herein provided.
Section 12.06. Governing Law. This Agreement shall be
construed in accordance with the laws of the State of New York and the
obligations, rights and remedies of the parties hereunder shall be determined in
accordance with such laws.
Section 12.07. Notices. All demands, notices and
communications hereunder shall be in writing and shall be deemed to have been
duly given if personally delivered at or mailed by first class or registered
mail, postage prepaid, to (i) in the case of the Depositor, Chase Mortgage
Finance Corporation, 000 Xxxx Xxxxxxxxx, Xxxxxxxxx Xxxx, Xxx Xxxxxx 00000, (ii)
in the case of the Seller, Chase Manhattan Mortgage Corporation, 000 Xxxx
Xxxxxxxxx, Xxxxxxxxx Xxxx, Xxx Xxxxxx 00000, Attention: Contract Finance, (iii)
in the case of the Servicer, Chase Manhattan Mortgage Corporation, 0000 Xxxxxx
Xxxxx,
00
Xxxxxxxx, Xxxx 00000, Attention: Investor Accounting, (iv) in the case of the
Trustee, Citibank, N.A., 000 Xxxx Xxxxxx, 00xx Floor/Zone 3, New York, New York
10005, Attention: GAT Services Department, (v) in the case of Fitch, Fitch,
Inc., Xxx Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, (vi) in the case of Moody's,
Xxxxx'x Investors Service, 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 and (vii)
in the case of any of the foregoing persons, such other addresses as may
hereafter be furnished by any such persons to the other parties to this
Agreement.
Section 12.08. Further Assurances. The Seller and the Servicer
agree to do and perform, from time to time, any and all acts and to execute any
and all further instruments required or reasonably requested by the Trustee more
fully to effect the purposes of this Agreement, including, without limitation,
the execution of any financing statements and the preparation for execution by
the Trustee of any continuation statements relating to the Co-op Loans for
filing under the provisions of the Uniform Commercial Code as in effect in the
jurisdiction in which the Underlying Mortgaged Property related to the affected
Co-op Loan is located. The Trustee agrees that it shall promptly execute and
redeliver to the Seller or the Servicer for filing any such continuation
statement so prepared by the Seller relating to the Co-op Loans.
[END OF ARTICLE XII]
87
IN WITNESS WHEREOF, the Depositor, the Servicer and the
Trustee have caused their names to be signed hereto by their respective officers
thereunto duly authorized as of the day and year first above written.
CHASE MORTGAGE FINANCE CORPORATION
By:
-----------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President
CHASE MANHATTAN MORTGAGE
CORPORATION
By:
-----------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President
CITIBANK, N.A.,
as Trustee
By:
-----------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Senior Trust Officer
EXHIBIT A
MORTGAGE LOAN SCHEDULE
[Intentionally Omitted]
A-1
EXHIBIT B
CONTENTS OF MORTGAGE FILE
(i) With respect to each Mortgage Loan which is not a Co-op Loan:
(A) (I) Original Mortgage Note (or a lost note affidavit
(including a copy of the original Mortgage Note)) or (II) original
consolidation, extension and modification agreement (or a lost note
affidavit (including a copy of the original consolidation, extension
and modification agreement)), in either case endorsed "Pay to the order
of Citibank, N.A., as trustee, without recourse".
(B) The original Mortgage (including all riders thereto) with
evidence of recording thereon, or a copy thereof certified by the
public recording office in which such Mortgage has been recorded or, if
the original Mortgage has not been returned from the applicable public
recording office, a true certified copy, certified by the Seller, of
the original Mortgage together with a certificate of the Seller
certifying that the original Mortgage has been delivered for recording
in the appropriate public recording office of the jurisdiction in which
the Mortgaged Property is located.
(C) The original Assignment of Mortgage to "Citibank, N.A., as
trustee," which assignment shall be in form and substance acceptable
for recording, or a copy certified by the Seller as a true and correct
copy of the original Assignment of Mortgage which has been sent for
recordation. Subject to the foregoing, such assignments may, if
permitted by law, be by blanket assignments for Mortgage Loans covering
Mortgaged Properties situated within the same county. If the Assignment
of Mortgage is in blanket form, a copy of the Assignment of Mortgage
shall be included in the related individual Mortgage File.
(D) The original policy of title insurance, including riders
and endorsements thereto, or if the policy has not yet been issued, a
written commitment or interim binder or preliminary report of title
issued by the title insurance or escrow company.
(E) Originals of all recorded intervening Assignments of
Mortgage, or copies thereof, certified by the public recording office
in which such Assignments or Mortgage have been recorded showing a
complete chain of title from the originator to the Depositor, with
evidence of recording, thereon, or a copy thereof certified by the
public recording office in which such Assignment of Mortgage has been
recorded or, if the original Assignment of Mortgage has not been
returned from the applicable public recording office, a true certified
copy, certified by the Seller of the original Assignment of Mortgage
together with a certificate of the Seller certifying that the original
Assignment of Mortgage has been delivered for recording in the
appropriate public recording office of the jurisdiction in which the
Mortgaged Property is located.
(F) Originals, or copies thereof certified by the public
recording office in which such documents have been recorded, of each
assumption, extension, modification, written assurance or substitution
agreements, if applicable, or if the original of such document has not
been returned from the applicable public recording office, a true
certified copy, certified by the Seller,
B-1
of such original document together with certificate of Seller
certifying the original of such document has been delivered for
recording in the appropriate recording office of the jurisdiction in
which the Mortgaged Property is located.
(G) If the Mortgage Note or Mortgage or any other material
document or instrument relating to the Mortgage Loan has been signed by
a person on behalf of the Mortgagor, the original power of attorney or
other instrument that authorized and empowered such person to sign
bearing evidence that such instrument has been recorded, if so required
in the appropriate jurisdiction where the Mortgaged Property is located
(or, in lieu thereof, a duplicate or conformed copy of such instrument,
together with a certificate of receipt from the recording office,
certifying that such copy represents a true and complete copy of the
original and that such original has been or is currently submitted to
be recorded in the appropriate governmental recording office of the
jurisdiction where the Mortgaged Property is located), or if the
original power of attorney or other such instrument has been delivered
for recording in the appropriate public recording office of the
jurisdiction in which the Mortgaged Property is located.
(ii) With respect to each Co-op Loan:
(A) (I) The original Mortgage Note (or a lost note affidavit
(including a copy of the original Mortgage Note)) or (II) original
consolidation, extension and modification agreement (or a lost note
affidavit (including a copy of the original consolidation, extension
and modification agreement)), in either case endorsed "Pay to the order
of Citibank, N.A., as trustee, without recourse."
(B) The original Mortgage entered into by the Mortgagor with
respect to such Co-op Loan.
(C) The original Assignment of Mortgage to "Citibank, N.A. as
trustee."
(D) Original assignments of Mortgage showing a complete chain
of assignment from the originator of the related Co-op Loan to the
Seller.
(E) Original Form UCC-1 and any continuation statements with
evidence of filing thereon entered into by the Mortgagor with respect
to such Co-op Loan.
(F) Form UCC-3 (or copy thereof) by the applicable Mortgage
Loan Seller or its agent assigning the security interest covered by
such Form UCC-1 to "Citibank, N.A. as trustee," together with all Forms
UCC-3 (or copies thereof) showing a complete chain of assignment from
the originator of the related Co-op Loan to the Seller, with evidence
of recording thereon.
(G) Stock certificate representing the stock allocated to the
related dwelling unit in the related residential cooperative housing
corporation and pledged by the related Mortgagor to the originator of
such Co-op Loan with a stock power in blank attached.
(H) Original proprietary lease.
B-2
(I) Original assignment of proprietary lease, to the Trustee,
and all intervening assignments thereof.
(J) Original recognition agreement of the interests of the
mortgagee with respect to the Co-op Loan by the residential cooperative
housing corporation, the stock of which was pledged by the related
Mortgagor to the originator of such Co-op Loan.
(K) Originals of any assumption, consolidation or modification
agreements relating to any of the items specified in (A) through (F)
above with respect to such Co-op Loan.
B-3
EXHIBIT C
FORM OF CLASS A CERTIFICATES
SOLELY FOR FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR INTEREST"
IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED.
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN CHASE
MORTGAGE FINANCE CORPORATION ("CMFC"), THE SERVICER OR THE TRUSTEE 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 CMFC, CHASE MANHATTAN MORTGAGE CORPORATION, THE TRUSTEE 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 WILL BE DIFFERENT FROM THE ORIGINAL DENOMINATION SHOWN BELOW.
ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT PRINCIPAL BALANCE BY
INQUIRY OF THE TRUSTEE.
CLASS A-1 CERTIFICATE
Number 01-S1-A-1-1 Original Denomination
$_______________
Cut-off Date: January 1, 2001 Final Scheduled
Distribution Date: February 25, 2031
First Distribution Date: Aggregate Original Principal
February 26, 2001 Balance of all Class A-1
Certificates: $_____________
Certificate Rate: ____% CUSIP: 16162T ____
C-1
MULTI-CLASS MORTGAGE PASS-THROUGH CERTIFICATE
Series 2001-S1
evidencing an ownership interest in distributions allocable to the Class A-1
Certificates with respect to a pool of conventional one- to four-family mortgage
loans formed and sold by
CHASE MORTGAGE FINANCE CORPORATION
Unless this Certificate is presented by an authorized
representative of the Depository Trust Company, a New York corporation ("DTC"),
to the Trustee 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 certifies that CEDE & CO. is the registered owner of the
ownership interest (the "Ownership Interest") evidenced by this Certificate
(obtained by dividing the Original Denomination of this Certificate by the
aggregate Original Denomination of all Class A-1 Certificates) in certain
distributions with respect to a pool of conventional one- to four-family first
lien mortgage loans (the "Mortgage Loans") formed and sold by Chase Mortgage
Finance Corporation (hereinafter called the "Depositor"), and certain other
property held in trust for the benefit of Certificateholders (collectively, the
"Trust Fund"). The Mortgage Loans are serviced by Chase Manhattan Mortgage
Corporation (the "Servicer") and are secured by first mortgages on Mortgaged
Properties. The Trust Fund was created pursuant to a Pooling and Servicing
Agreement (the "Agreement"), dated as of January 1, 2001 among the Depositor,
the Servicer and Citibank, N.A., as trustee (the "Trustee"), a summary of
certain of the pertinent provisions of which is set forth hereafter. To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement.
This Certificate is one of a duly authorized issue of
Certificates, designated as Multi- Class Mortgage Pass-Through Certificates,
Series 2001-S1, Class A-1 (the "Class A-1 Certificates") and 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 Agreement such Holder is bound. Also issued under the
Agreement are Certificates designated as Multi- Class Mortgage Pass-Through
Certificates, Series 2001-S1, Class M Certificates (the "Class M Certificates")
and Class B Certificates (the "Class B Certificates"). The Class A Certificates,
the Class M Certificates and the Class B Certificates are collectively referred
to herein as the "Certificates."
Pursuant to the terms of the Agreement, the Trustee, or, if a
Paying Agent has been appointed under Section 4.05 thereof, the Paying Agent,
will distribute from funds in the Certificate Account the amount as described on
the reverse hereof on the 25th day of each month or, if such 25th day is not a
Business Day, the Business Day immediately following (the "Distribution Date"),
commencing on February 26, 2001. Such distributions will be made to the Person
in whose name this Certificate is registered at the close of business on the
last Business Day of the month preceding the month in which such payment is
made, or if such last day is not a Business Day, the Business Day immediately
preceding such last day.
C-2
Distributions on this Certificate will be made either by check
mailed to the address of the Person entitled thereto, as such name and address
shall appear on the Certificate Register, or by wire transfer in immediately
available funds to the account of such Holder at a bank or other financial or
depository institution having appropriate facilities therefor, if such Holder
has so notified the Paying Agent in writing at least 10 Business Days prior to
the first Distribution Date for which distribution by wire transfer is to be
made, and such Holder's Certificates evidence an aggregate original denomination
of not less than $5,000,000 or such Holder holds a 100% Percentage Interest of
such Class. Notwithstanding the above, the final distribution on this
Certificate will be made after due notice by the Trustee, or, if a Paying Agent
has been appointed under Section 4.05, the Paying Agent, of the pendency of such
distribution and only upon presentation and surrender of this Certificate at the
office of the Trustee, or, if a Paying Agent has been appointed under Section
4.05, the Paying Agent, or agency appointed by the Trustee, or, if a Paying
Agent has been appointed under Section 4.05, the Paying Agent, for the purpose
and specified in such notice of final distribution.
The Trustee will cause to be kept at its Corporate Trust
Office in New York, New York, or at the office of its designated agent, a
Certificate Register in which, subject to such reasonable regulations as it may
prescribe, the Trustee will provide for the registration of Certificates and of
transfers and exchanges of Certificates. Upon surrender for registration of
transfer of any Certificate at any office or agency of the Trustee, or, if a
Paying Agent has been appointed under Section 4.05, the Paying Agent, maintained
for such purpose, the Trustee, or, if a Paying Agent has been appointed under
Section 4.05, the Paying Agent, will, subject to the limitations set forth in
the Agreement, authenticate and deliver, in the name of the designated
transferee or transferees, a Certificate of a like class and dated the date of
authentication by the Authenticating Agent. Notwithstanding the above, the final
distribution on this Certificate will be made after due notice by the Trustee,
or, if a Paying Agent has been appointed under Section 4.05, the Paying Agent,
of the pendency of such distribution and only upon presentation and surrender of
this Certificate at the office or agency appointed by the Trustee, or, if a
Paying Agent has been appointed under Section 4.05, the Paying Agent, for that
purpose and specified in such notice of final distribution.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof which further provisions shall for
all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication has been executed by
the Authenticating Agent, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
C-3
IN WITNESS WHEREOF, the Depositor has caused this Certificate to be duly
executed.
Dated: January 26, 2001 CHASE MORTGAGE FINANCE CORPORATION
By: ______________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class A-1
Certificates referred to
in the within-mentioned
Agreement.
THE CHASE MANHATTAN BANK
as Authenticating Agent
By: ________________________
Authorized Signatory
C-4
REVERSE OF CERTIFICATE
MULTI-CLASS MORTGAGE PASS-THROUGH CERTIFICATE
SERIES 2001-S1
This Certificate is one of a duly authorized issue of
Certificates, designated as Multi- Class Mortgage Pass-Through Certificates,
Series 2001-S1, issued in seven Classes of Class A Certificates, one Class of
Class M Certificates and five Classes of Class B Certificates, each evidencing
an interest in certain distributions with respect to a pool of fixed rate one-
to four-family first lien Mortgage Loans formed and sold by the Depositor and
certain other property conveyed by the Depositor to the Trustee. The Class A
Certificates evidence in the aggregate the Class A Percentage of distributions
relating to repayments of principal and interest on such Mortgage Loans. The
Class M Certificates evidence in the aggregate the Class M Percentage of
distributions relating to repayments of principal and interest on such Mortgage
Loans. The Class B Certificates evidence in the aggregate the Class B Percentage
of distributions relating to repayments of principal and interest on such
Mortgage Loans.
Following the initial issuance of the Certificates, the
Principal Balance of this Certificate will be different from the Original
Denomination shown above. Anyone acquiring this Certificate may ascertain its
current Principal Balance by inquiry of the Trustee.
The Holder, by its acceptance of this Certificate, agrees that
it will look solely to the Trust Fund and certain amounts resulting from credit
enhancements for payment hereunder and that the Trustee is not liable to the
Holders for any amount payable under this Certificate or the Agreement or,
except as expressly provided in the Agreement, subject to any liability under
the Agreement.
This Certificate does not purport to summarize the Agreement
and reference is made to the Agreement for the interests, rights and limitations
of rights, benefits, obligations and duties evidenced hereby, and the rights,
duties and immunities of the Trustee.
The Trustee will cause to be kept at its Corporate Trust
Office in New York, New York, or at the office of any Paying Agent appointed
under the Agreement, a Certificate Register in which, subject to such reasonable
regulations as it may prescribe, the Trustee (or any Paying Agent, as the case
may be) will provide for the registration of Certificates and of transfers and
exchanges of Certificates. Upon surrender for registration of transfer of any
Certificate at any office or agency of the Trustee, or, if a Paying Agent has
been appointed under Section 4.05, the Paying Agent, maintained for such
purpose, the Trustee, or, if a Paying Agent has been appointed under Section
4.05, the Paying Agent, will, subject to the limitations set forth in the
Agreement, authenticate and deliver, in the name of the designated transferee or
transferees, a Certificate of a like Class and dated the date of authentication
by the Authenticating Agent.
No service charge will be made to the Holder for any transfer
or exchange of the Certificate, but the Trustee, or, if a Paying Agent has been
appointed under Section 4.05, the Paying Agent, 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 the Certificate. Prior to due
presentation of a Certificate for registration of transfer, the Depositor, the
Servicer and the Trustee may treat the person in whose name any Certificate is
registered as the owner of such Certificate and the Percentage Interest in the
Trust Fund evidenced thereby for the purpose of receiving distributions pursuant
to the Agreement and for all other purposes whatsoever, and neither the
Depositor, the Servicer, the Paying Agent nor the Trustee will be affected by
notice to the contrary.
C-5
The Agreement may be amended from time to time by the
Depositor, the Servicer and the Trustee, without the consent of any of the
Certificateholders, to cure any ambiguity, to correct or supplement any
provisions therein which may be inconsistent with the other provisions therein,
to ensure continuing treatment of the Trust Fund as a REMIC, or to make any
other provisions with respect to matters or questions arising under the
Agreement which are not materially inconsistent with the provisions of the
Agreement, provided that such action does not, as evidenced by an Opinion of
Counsel, adversely affect in any material respect the interests of any
Certificateholder or cause the Trust Fund to fail to qualify as a REMIC.
The Agreement may also be amended from time to time by the
Depositor, the Servicer and the Trustee with the consent of the Holders of
Certificates evidencing in the aggregate not less than 66-2/3% of the Percentage
Interests of each Class of Certificates affected thereby for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of the Agreement or of modifying in any manner the rights of the
Holders of Certificates of such Class; provided, however, that no such amendment
may (i) reduce in any manner the amount of, or delay the timing of, payments
received on Mortgage Loans which are required to be distributed on any
Certificate without the consent of the Holder of such Certificate, (ii) reduce
the aforesaid percentage of Certificates of any Class the Holders of which are
required to consent to any such amendment or (iii) change the percentage
specified in clause (ii) of the first paragraph of Section 11.01 of the
Agreement, without the consent of the Holders of all Certificates of such Class
then outstanding.
The Depositor intends to cause an election to be made to treat
the assets of the Trust Fund as a real estate mortgage investment conduit (a
"REMIC") for federal income tax purposes. The Class A Certificates (other than
the Class A-R Certificate), the Class M Certificates and the Class B
Certificates will constitute "regular interests" in the REMIC. The Class A-R
Certificate will represent the sole class of "residual interest" in the REMIC.
The respective obligations and responsibilities of the
Depositor, the Servicer (except the duty to pay the Trustee's fees and expenses
and indemnification hereunder) and the Trustee shall terminate upon (i) the
later of the final payment or other liquidation (or any Advance with respect
thereto) of the last Mortgage Loan or the disposition of all property acquired
upon foreclosure or deed in lieu of foreclosure of any Mortgage Loan and the
remittance of all funds due hereunder; or (ii) at the option of the Servicer, on
any Distribution Date which occurs in the month next following a Due Date on
which the aggregate unpaid Principal Balance of all Outstanding Mortgage Loans
is less than 10% of the aggregate unpaid Principal Balance of the Mortgage Loans
on the Cut-off Date, so long as the Servicer deposits or causes to be deposited
in the Collection Account during the Principal Prepayment Period related to such
Distribution Date (and provides notice to the Trustee of its intention to so
deposit on or before the 20th day of such Principal Prepayment Period) an amount
equal to the greater of (A) the Purchase Price for each Outstanding Mortgage
Loan, less any unreimbursed Advances made with respect to any Mortgage Loan
(which amount shall offset completely any unreimbursed Advances for which the
Servicer is otherwise entitled to reimbursement), and, with respect to all
property acquired in respect of any Mortgage Loan remaining in the Trust Fund,
an amount equal to the fair market value of such property, as determined by an
appraisal to be conducted by an appraiser selected by the Trustee, less
unreimbursed Advances made with respect to any Mortgage Loan with respect to
which property has been acquired and (B) the aggregate Outstanding Certificate
Principal Balance of the Class A, Class M, Class B-1 and Class B-2 Certificates,
plus any accrued and unpaid interest thereon at the Remittance Rate; provided,
however, that 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.
James's, living on the date hereof.
C-6
[FORM OF ASSIGNMENT]
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto
(PLEASE INSERT SOCIAL SECURITY* OR TAXPAYER IDENTIFICATION NUMBER OF
ASSIGNEE)
__________________________________________
_____________________________________________________________
(Please Print or Type Name and Address of Assignee)
______________________________________________________________________________
the within Certificate, and all rights thereunder, and hereby does irrevocably
constitute and appoint
__________________________________________________ Attorney to transfer the
within Certificate on the books kept for the registration thereof, with full
power of substitution in the premises.
Dated:
(Signature guaranty) _______________________________
NOTICE: The signature to this assignment must
correspond with the name as it appears upon
the face of the within Certificate in every
particular, without alteration or enlargement
or any change whatever.
(*This information, which is voluntary, is being requested to ensure that the
assignee will not be subject to backup withholding under Section 3406 of the
Code.)
C-7
EXHIBIT D
FORM OF CLASS M CERTIFICATE
THIS CLASS M CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A
CERTIFICATES AS DESCRIBED IN THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN.
SOLELY FOR FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR INTEREST"
IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED (THE "CODE").
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN CHASE
MORTGAGE FINANCE CORPORATION ("CMFC"), THE SERVICER OR THE TRUSTEE 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 CMFC, CHASE MANHATTAN MORTGAGE CORPORATION, THE TRUSTEE OR BY ANY OF
THEIR AFFILIATES OR BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
[THIS LEGEND WILL APPEAR ON THE CERTIFICATE IF SUCH CERTIFICATE IS AN ERISA
RESTRICTED CERTIFICATE (AS DEFINED IN THE POOLING AND SERVICING AGREEMENT).] NO
TRANSFER OF THIS CERTIFICATE SHALL BE MADE UNLESS THE TRUSTEE SHALL HAVE
RECEIVED EITHER (i) A REPRESENTATION LETTER FROM THE TRANSFEREE OF THIS
CERTIFICATE TO THE EFFECT THAT SUCH TRANSFEREE EITHER (A) IS NOT AN EMPLOYEE
BENEFIT PLAN SUBJECT TO SECTION 406 OF THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED ("ERISA") OR SECTION 4975 OF THE CODE OR MATERIALLY
SIMILAR PROVISIONS OF APPLICABLE FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW") (A
"PLAN"), AND IS NOT DIRECTLY OR INDIRECTLY PURCHASING ANY CERTIFICATE ON BEHALF
OF, AS INVESTMENT MANAGER OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF OR WITH
ASSETS OF A PLAN OR, IN THE CASE OF AN INSURANCE COMPANY, THE ASSETS OF ANY
SEPARATE ACCOUNTS TO EFFECT SUCH ACQUISITION OR (B) THE SOURCE OF FUNDS FOR THE
PURCHASE OF THE CERTIFICATES IS AN "INSURANCE COMPANY GENERAL ACCOUNT" WITHIN
THE MEANING OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 ("PTCE 95-60"), 60
FED. REG. 35925 (JULY 12, 1995), AND THE PURCHASE AND HOLDING OF THE
CERTIFICATES IS EXEMPT UNDER PTCE 95-60, OR (ii) IF THIS CERTIFICATE IS
PRESENTED FOR REGISTRATION IN THE NAME OF A PLAN SUBJECT TO TITLE I OF ERISA, OR
SECTION 4975 OF THE CODE OR SIMILAR LAW (OR COMPARABLE PROVISIONS OF ANY
SUBSEQUENT ENACTMENTS), OR A TRUSTEE OF ANY SUCH PLAN, OR ANY OTHER PERSON WHO
IS USING THE ASSETS OF ANY SUCH PLAN TO EFFECT SUCH ACQUISITION, AN OPINION OF
COUNSEL TO THE EFFECT THAT THE PURCHASE OR HOLDING OF THIS CERTIFICATE WILL NOT
RESULT IN THE ASSETS OF THE TRUST FUND BEING DEEMED TO BE "PLAN ASSETS" PURSUANT
TO THE DEPARTMENT OF LABOR PLAN ASSET REGULATIONS SET FORTH IN 29 C.F.R.
ss.2510.3-101 AND TO BE SUBJECT TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF
ERISA OR THE PROHIBITED TRANSACTION PROVISIONS OF ERISA OR THE CODE OR SIMILAR
LAW, WILL NOT CONSTITUTE OR RESULT IN A PROHIBITED TRANSACTION WITHIN THE
MEANING OF SECTION 406 OR SECTION 407 OF ERISA OR SECTION 4975 OF THE CODE OR
SIMILAR LAW, AND WILL NOT SUBJECT THE TRUSTEE, THE SERVICER, CMFC OR ANY OF
THEIR
AFFILIATES TO ANY OBLIGATION OR LIABILITY (INCLUDING OBLIGATIONS OR LIABILITIES
UNDER ERISA OR SECTION 4975 OF THE CODE OR SIMILAR LAW) RELATING TO THE
CERTIFICATES.
FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE PRINCIPAL BALANCE OF
THIS CERTIFICATE WILL BE DIFFERENT FROM THE ORIGINAL DENOMINATION SHOWN BELOW.
ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT PRINCIPAL BALANCE BY
INQUIRY OF THE TRUSTEE.
CLASS M CERTIFICATE
Number 01-S1-M-1 Original Denomination
$______________
Cut-off Date: January 1, 2001 Final Scheduled Distribution
Date: February 25, 2031
First Distribution Date: Aggregate Original Principal
February 26, 2001 Balance of all Class M
Certificates: $_____________
Certificate Rate: ____% CUSIP: 16162T ____
D-2
MULTI-CLASS MORTGAGE PASS-THROUGH CERTIFICATE
SERIES 2001-S1
evidencing an ownership interest in distributions allocable to the Class M
Certificates with respect to a pool of conventional one- to four-family mortgage
loans formed and sold by
CHASE MORTGAGE FINANCE CORPORATION
This certifies that ____________________ is the registered
owner of the ownership interest (the "Ownership Interest") evidenced by this
Certificate (obtained by dividing the Original Denomination of this Certificate
by the aggregate Original Denomination of all Class M Certificates) in certain
distributions with respect to a pool of conventional one- to four-family first
lien mortgage loans (the "Mortgage Loans") formed and sold by Chase Mortgage
Finance Corporation (hereinafter called the "Depositor"), and certain other
property held in trust for the benefit of Certificateholders (collectively, the
"Trust Fund"). The Mortgage Loans are serviced by Chase Manhattan Mortgage
Corporation (the "Servicer") and are secured by first mortgages on Mortgaged
Properties. The Trust Fund was created pursuant to a Pooling and Servicing
Agreement (the "Agreement"), dated as of January 1, 2001 among the Depositor,
the Servicer and Citibank, N.A., as trustee (the "Trustee"), a summary of
certain of the pertinent provisions of which is set forth hereafter. To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement.
This Certificate is one of a duly authorized issue of
Certificates, designated as Multi- Class Mortgage Pass-Through Certificates,
Series 2001-S1, Class M (the "Class M Certificates") and 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 Agreement such Holder is bound. Also issued under the
Agreement are Certificates designated as Multi- Class Mortgage Pass-Through
Certificates, Series 2001-S1, Class A (the "Class A Certificates") and Class B
(the "Class B Certificates"). The Class A Certificates are senior to, and the
Class B Certificates are subordinate to, the Class M Certificates in right of
payment to the extent described herein and in the Agreement. The Class A
Certificates, the Class M Certificates and the Class B Certificates are
collectively referred to herein as the "Certificates." Amounts properly
distributed to the Class M Certificateholders pursuant to the Agreement will be
deemed released from the Trust Fund, and the Class M Certificateholders will not
in any event be required to refund any such distributed amounts.
Pursuant to the terms of the Agreement, the Trustee, or, if a
Paying Agent has been appointed under Section 4.05 thereof, the Paying Agent,
will distribute from funds in the Certificate Account the amount as described on
the reverse hereof on the 25th day of each month or, if such 25th day is not a
Business Day, the Business Day immediately following (the "Distribution Date"),
commencing on February 26, 2001. Such distributions will be made to the Person
in whose name this Certificate is registered at the close of business on the
last Business Day of the month preceding the month in which such payment is
made, or if such last day is not a Business Day, the Business Day immediately
preceding such last day.
Distributions on this Certificate will be made either by check
mailed to the address of the Person entitled thereto, as such name and address
shall appear on the Certificate Register, or by wire transfer in immediately
available funds to the account of such Holder at a bank or other financial or
depository institution having appropriate facilities therefor, if such Holder
has so notified the Paying Agent in writing at least 10 Business Days prior to
the first Distribution Date for which distribution by wire transfer is to be
made, and such Holder's Certificates evidence an aggregate original principal
balance of not less than $5,000,000 or such Holder holds a 100% Percentage
Interest of such Class.
D-3
Notwithstanding the above, the final distribution on this Certificate will be
made after due notice by the Trustee, or, if a Paying Agent has been appointed
under Section 4.05, the Paying Agent, of the pendency of such distribution and
only upon presentation and surrender of this Certificate at the office of the
Trustee, or, if a Paying Agent has been appointed under Section 4.05, the Paying
Agent, or agency appointed by the Trustee, or, if a Paying Agent has been
appointed under Section 4.05, the Paying Agent, for the purpose and specified in
such notice of final distribution.
The Trustee will cause to be kept at its Corporate Trust
Office in New York, New York, or at the office of its designated agent, a
Certificate Register in which, subject to such reasonable regulations as it may
prescribe, the Trustee will provide for the registration of Certificates and of
transfers and exchanges of Certificates. Upon surrender for registration of
transfer of any Certificate at any office or agency of the Trustee, or, if a
Paying Agent has been appointed under Section 4.05, the Paying Agent, maintained
for such purpose, the Trustee, or, if a Paying Agent has been appointed under
Section 4.05, the Paying Agent, will, subject to the limitations set forth in
the Agreement, authenticate and deliver, in the name of the designated
transferee or transferees, a Certificate of a like class and dated the date of
authentication by the Authenticating Agent. Notwithstanding the above, the final
distribution on this Certificate will be made after due notice by the Trustee,
or, if a Paying Agent has been appointed under Section 4.05, the Paying Agent,
of the pendency of such distribution and only upon presentation and surrender of
this Certificate at the office or agency appointed by the Trustee, or, if a
Paying Agent has been appointed under Section 4.05, the Paying Agent, for that
purpose and specified in such notice of final distribution.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof which further provisions shall for
all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication has been executed by
the Authenticating Agent, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
D-4
IN WITNESS WHEREOF, the Depositor has caused this Certificate to be duly
executed.
Dated: January 26, 2001 CHASE MORTGAGE FINANCE CORPORATION
By: ______________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class M
Certificates referred to
in the within-mentioned
Agreement.
THE CHASE MANHATTAN BANK
as Authenticating Agent
By: ________________________
Authorized Signatory
D-5
REVERSE OF CERTIFICATE
MULTI-CLASS MORTGAGE PASS-THROUGH CERTIFICATE
SERIES 2001-S1
This Certificate is one of a duly authorized issue of
Certificates, designated as Multi- Class Mortgage Pass-Through Certificates,
Series 2001-S1, issued in seven Classes of Class A Certificates, one Class of
Class M Certificates and five Classes of Class B Certificates, each evidencing
an interest in certain distributions with respect to a pool of fixed rate one-
to four-family first lien Mortgage Loans formed and sold by the Depositor and
certain other property conveyed by the Depositor to the Trustee. The Class A
Certificates evidence in the aggregate the Class A Percentage of distributions
relating to repayments of principal and interest on such Mortgage Loans. The
Class M Certificates evidence in the aggregate the Class M Percentage of
distributions relating to repayments of principal and interest on such Mortgage
Loans. The Class B Certificates evidence in the aggregate the Class B Percentage
of distributions relating to repayments of principal and interest on such
Mortgage Loans.
Following the initial issuance of the Certificates, the
Principal Balance of this Certificate will be different from the Original
Denomination shown above. Anyone acquiring this Certificate may ascertain its
current Principal Balance by inquiry of the Trustee.
The Holder, by its acceptance of this Certificate, agrees that
it will look solely to the Trust Fund and certain amounts resulting from credit
enhancements for payment hereunder and that the Trustee is not liable to the
Holders for any amount payable under this Certificate or the Agreement or,
except as expressly provided in the Agreement, subject to any liability under
the Agreement.
This Certificate does not purport to summarize the Agreement
and reference is made to the Agreement for the interests, rights and limitations
of rights, benefits, obligations and duties evidenced hereby, and the rights,
duties and immunities of the Trustee.
The Trustee will cause to be kept at its Corporate Trust
Office in New York, New York, or at the office of any Paying Agent appointed
under the Agreement, a Certificate Register in which, subject to such reasonable
regulations as it may prescribe, the Trustee (or any Paying Agent, as the case
may be) will provide for the registration of Certificates and of transfers and
exchanges of Certificates. Upon surrender for registration of transfer of any
Certificate at any office or agency of the Trustee, or, if a Paying Agent has
been appointed under Section 4.05, the Paying Agent, maintained for such
purpose, the Trustee, or, if a Paying Agent has been appointed under Section
4.05, the Paying Agent, will, subject to the limitations set forth in the
Agreement, authenticate and deliver, in the name of the designated transferee or
transferees, a Certificate of a like Class and dated the date of authentication
by the Authenticating Agent.
No service charge will be made to the Holder for any transfer
or exchange of the Certificate, but the Trustee, or, if a Paying Agent has been
appointed under Section 4.05, the Paying Agent, 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 the Certificate. Prior to due
presentation of a Certificate for registration of transfer, the Depositor, the
Servicer and the Trustee may treat the person in whose name any Certificate is
registered as the owner of such Certificate and the Percentage Interest in the
Trust Fund evidenced thereby for the purpose of receiving distributions pursuant
to the Agreement and for all other purposes whatsoever, and neither the
Depositor, the Servicer, the Paying Agent nor the Trustee will be affected by
notice to the contrary.
D-6
The Agreement may be amended from time to time by the
Depositor, the Servicer and the Trustee, without the consent of any of the
Certificateholders, to cure any ambiguity, to correct or supplement any
provisions therein which may be inconsistent with the other provisions therein,
to ensure continuing treatment of the Trust Fund as a REMIC, or to make any
other provisions with respect to matters or questions arising under the
Agreement which are not materially inconsistent with the provisions of the
Agreement, provided that such action does not, as evidenced by an Opinion of
Counsel, adversely affect in any material respect the interests of any
Certificateholder or cause the Trust Fund to fail to qualify as a REMIC.
The Agreement may also be amended from time to time by the
Depositor, the Servicer and the Trustee with the consent of the Holders of
Certificates evidencing in the aggregate not less than 66-2/3% of the Percentage
Interests of each Class of Certificates affected thereby for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of the Agreement or of modifying in any manner the rights of the
Holders of Certificates of such Class; provided, however, that no such amendment
may (i) reduce in any manner the amount of, or delay the timing of, payments
received on Mortgage Loans which are required to be distributed on any
Certificate without the consent of the Holder of such Certificate, (ii) reduce
the aforesaid percentage of Certificates of any Class the Holders of which are
required to consent to any such amendment or (iii) change the percentage
specified in clause (ii) of the first paragraph of Section 11.01 of the
Agreement, without the consent of the Holders of all Certificates of such Class
then outstanding.
The Depositor intends to cause an election to be made to treat
the Trust Fund as a real estate mortgage investment conduit (a "REMIC") for
federal income tax purposes. The Class A Certificates (other than the Class A-R
Certificate), the Class M Certificates and the Class B Certificates will
constitute "regular interests" in the REMIC. The Class A-R Certificate will
represent the sole class of "residual interest" in the REMIC.
The respective obligations and responsibilities of the
Depositor, the Servicer (except the duty to pay the Trustee's fees and expenses
and indemnification hereunder) and the Trustee shall terminate upon (i) the
later of the final payment or other liquidation (or any Advance with respect
thereto) of the last Mortgage Loan or the disposition of all property acquired
upon foreclosure or deed in lieu of foreclosure of any Mortgage Loan and the
remittance of all funds due hereunder; or (ii) at the option of the Servicer, on
any Distribution Date which occurs in the month next following a Due Date on
which the aggregate unpaid Principal Balance of all Outstanding Mortgage Loans
is less than 10% of the aggregate unpaid Principal Balance of the Mortgage Loans
on the Cut-off Date, so long as the Servicer deposits or causes to be deposited
in the Collection Account during the Principal Prepayment Period related to such
Distribution Date (and provides notice to the Trustee of its intention to so
deposit on or before the 20th day of such Principal Prepayment Period) an amount
equal to the greater of (A) the Purchase Price for each Outstanding Mortgage
Loan, less any unreimbursed Advances made with respect to any Mortgage Loan
(which amount shall offset completely any unreimbursed Advances for which the
Servicer is otherwise entitled to reimbursement), and, with respect to all
property acquired in respect of any Mortgage Loan remaining in the Trust Fund,
an amount equal to the fair market value of such property, as determined by an
appraisal to be conducted by an appraiser selected by the Trustee, less
unreimbursed Advances made with respect to any Mortgage Loan with respect to
which property has been acquired and (B) the aggregate Outstanding Certificate
Principal Balance of the Class A, Class M, Class B-1 and Class B-2 Certificates,
plus any accrued and unpaid interest thereon at the Remittance Rate; provided,
however, that 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.
James's, living on the date hereof.
D-7
[FORM OF ASSIGNMENT]
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto
(PLEASE INSERT SOCIAL SECURITY* OR TAXPAYER IDENTIFICATION NUMBER OF
ASSIGNEE)
__________________________________________
_____________________________________________________________
(Please Print or Type Name and Address of Assignee)
______________________________________________________________________________
the within Certificate, and all rights thereunder, and hereby does irrevocably
constitute and appoint
__________________________________________________ Attorney to transfer the
within Certificate on the books kept for the registration thereof, with full
power of substitution in the premises.
Dated:
(Signature guaranty) _____________________________________
NOTICE: The signature to this assignment must
correspond with the name as it appears upon
the face of the within Certificate in every
particular, without alteration or enlargement
or any change whatever.
(*This information, which is voluntary, is being requested to ensure that the
assignee will not be subject to backup withholding under Section 3406 of the
Code.)
D-8
EXHIBIT E
FORM OF CLASS B CERTIFICATES
THIS CLASS B-1 CERTIFICATE IS SUBORDINATED IN RIGHT OF PAYMENT TO THE CLASS A
CERTIFICATES AND THE CLASS M CERTIFICATES AS DESCRIBED IN THE POOLING AND
SERVICING AGREEMENT REFERRED TO HEREIN.
SOLELY FOR FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR INTEREST"
IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE DEFINED,
RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED (THE "CODE").
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN CHASE
MORTGAGE FINANCE CORPORATION ("CMFC"), THE SERVICER OR THE TRUSTEE 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 CMFC, CHASE MANHATTAN MORTGAGE CORPORATION, THE TRUSTEE OR BY ANY OF
THEIR AFFILIATES OR BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
[THIS LEGEND WILL APPEAR ON THE CERTIFICATE IF SUCH CERTIFICATE IS AN ERISA
RESTRICTED CERTIFICATE (AS DEFINED IN THE POOLING AND SERVICING AGREEMENT).] NO
TRANSFER OF THIS CERTIFICATE SHALL BE MADE UNLESS THE TRUSTEE SHALL HAVE
RECEIVED EITHER (i) A REPRESENTATION LETTER FROM THE TRANSFEREE OF THIS
CERTIFICATE TO THE EFFECT THAT SUCH TRANSFEREE EITHER (A) IS NOT AN EMPLOYEE
BENEFIT PLAN SUBJECT TO SECTION 406 OF THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED ("ERISA") OR SECTION 4975 OF THE CODE OR MATERIALLY
SIMILAR PROVISION OF APPLICABLE FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW") (A
"PLAN"), AND IS NOT DIRECTLY OR INDIRECTLY PURCHASING ANY CERTIFICATE ON BEHALF
OF, AS INVESTMENT MANAGER OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF OR WITH
ASSETS OF A PLAN OR, IN THE CASE OF AN INSURANCE COMPANY, THE ASSETS OF ANY
SEPARATE ACCOUNTS TO EFFECT SUCH ACQUISITION OR (B) THE SOURCE OF FUNDS FOR THE
PURCHASE OF THE CERTIFICATES IS AN "INSURANCE COMPANY GENERAL ACCOUNT" WITHIN
THE MEANING OF PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 ("PTCE 95-60"), 60
FED. REG. 35925 (JULY 12, 1995), AND THE PURCHASE AND HOLDING OF THE
CERTIFICATES IS EXEMPT UNDER PTCE 95-60, OR (ii) IF THIS CERTIFICATE IS
PRESENTED FOR REGISTRATION IN THE NAME OF A PLAN SUBJECT TO TITLE I OF ERISA, OR
SECTION 4975 OF THE CODE OR SIMILAR LAW (OR COMPARABLE PROVISIONS OF ANY
SUBSEQUENT ENACTMENTS), OR A TRUSTEE OF ANY SUCH PLAN, OR ANY OTHER PERSON WHO
IS USING THE ASSETS OF ANY SUCH PLAN TO EFFECT SUCH ACQUISITION, AN OPINION OF
COUNSEL TO THE EFFECT THAT THE PURCHASE OR HOLDING OF THIS CERTIFICATE WILL NOT
RESULT IN THE ASSETS OF THE TRUST FUND BEING DEEMED TO BE "PLAN ASSETS" PURSUANT
TO THE DEPARTMENT OF LABOR PLAN ASSET REGULATIONS SET FORTH IN 29 C.F.R.
ss.2510.3-101 AND TO BE SUBJECT TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF
ERISA OR THE PROHIBITED TRANSACTION PROVISIONS OF ERISA OR THE CODE OR SIMILAR
LAW, WILL NOT CONSTITUTE OR RESULT IN A PROHIBITED TRANSACTION WITHIN THE
MEANING OF SECTION 406 OR SECTION 407 OF ERISA OR SECTION 4975 OF THE CODE OR
SIMILAR LAW, AND WILL NOT SUBJECT THE TRUSTEE, THE SERVICER, CMFC OR ANY OF
THEIR
E-1
AFFILIATES TO ANY OBLIGATION OR LIABILITY (INCLUDING OBLIGATIONS OR LIABILITIES
UNDER ERISA OR SECTION 4975 OF THE CODE OR SIMILAR LAW) RELATING TO THE
CERTIFICATES.
FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE PRINCIPAL BALANCE OF
THIS CERTIFICATE WILL BE DIFFERENT FROM THE ORIGINAL DENOMINATION SHOWN BELOW.
ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT PRINCIPAL BALANCE BY
INQUIRY OF THE TRUSTEE.
CLASS B-1 CERTIFICATE
Number 01-S1-B-1-1 Original Denomination
$_______________
Cut-off Date: January 1, 2001 Final Scheduled
Distribution Date: February 25, 2031
First Distribution Date: Aggregate Original Principal
February 26, 2001 Balance of all Class B-1
Certificates: $____________
Certificate Rate: ____% CUSIP: 16162T ____
E-2
MULTI-CLASS MORTGAGE PASS-THROUGH CERTIFICATE
Series 2001-S1
evidencing an ownership interest in distributions allocable to the Class B-1
Certificates with respect to a pool of conventional one- to four-family mortgage
loans formed and sold by
CHASE MORTGAGE FINANCE CORPORATION
This certifies that ___________ is the registered owner of the
ownership interest (the "Ownership Interest") evidenced by this Certificate
(obtained by dividing the Original Denomination of this Certificate by the
aggregate Original Denomination of all Class B-1 Certificates) in certain
distributions with respect to a pool of conventional one- to four-family first
lien mortgage loans (the "Mortgage Loans") formed and sold by Chase Mortgage
Finance Corporation (hereinafter called the "Depositor"), and certain other
property held in trust for the benefit of Certificateholders (collectively, the
"Trust Fund"). The Mortgage Loans are serviced by Chase Manhattan Mortgage
Corporation (the "Servicer") and are secured by first mortgages on Mortgaged
Properties. The Trust Fund was created pursuant to a Pooling and Servicing
Agreement (the "Agreement"), dated as of January 1, 2001 among the Depositor,
the Servicer and Citibank, N.A., as trustee (the "Trustee"), a summary of
certain of the pertinent provisions of which is set forth hereafter. To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement.
This Certificate is one of a duly authorized issue of
Certificates, designated as Multi- Class Mortgage Pass-Through Certificates,
Series 2001-S1, Class B-1 (the "Class B-1 Certificate") and 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 Agreement such Holder is bound. Also issued under the
Agreement are Certificates designated as Multi- Class Mortgage Pass-Through
Certificates, Series 2001-S1, Class A Certificates (the "Class A Certificates")
and Class M (the "Class M Certificates"). The rights of the Class B-1
Certificateholders to receive distributions in respect of the Class B
Certificates on any Distribution Date are subordinated to the rights of the
Class A and Class M Certificateholders to receive distributions in respect of
the Class A and Class M Certificates to the extent, and only to the extent, set
forth in the Agreement. The Class A Certificates, the Class M Certificates and
the Class B Certificates are collectively referred to herein as the
"Certificates." Amounts properly distributed to the Class B Certificateholders
pursuant to the Agreement will be deemed released from the Trust Fund, and the
Class B Certificateholders will not in any event be required to refund any such
distributed amounts.
Pursuant to the terms of the Agreement, the Trustee, or, if a
Paying Agent has been appointed under Section 4.05 thereof, the Paying Agent,
will distribute from funds in the Certificate Account the amount as described on
the reverse hereof on the 25th day of each month or, if such 25th day is not a
Business Day, the Business Day immediately following (the "Distribution Date"),
commencing on February 26, 2001. Such distributions will be made to the Person
in whose name this Certificate is registered at the close of business on the
last Business Day of the month preceding the month in which such payment is
made, or if such last day is not a Business Day, the Business Day immediately
preceding such last day.
Distributions on this Certificate will be made either by check
mailed to the address of the Person entitled thereto, as such name and address
shall appear on the Certificate Register, or by wire transfer in immediately
available funds to the account of such Holder at a bank or other financial or
depository institution having appropriate facilities therefor, if such Holder
has so notified the Paying Agent in writing at least 10 Business Days prior to
the first Distribution Date for which distribution by
E-3
wire transfer is to be made, and such Holder's Certificates evidence an
aggregate original principal balance of not less than $5,000,000 or such Holder
holds a 100% Percentage Interest of such Class. Notwithstanding the above, the
final distribution on this Certificate will be made after due notice by the
Trustee, or, if a Paying Agent has been appointed under Section 4.05, the Paying
Agent, of the pendency of such distribution and only upon presentation and
surrender of this Certificate at the office of the Trustee, or, if a Paying
Agent has been appointed under Section 4.05, the Paying Agent, or agency
appointed by the Trustee, or, if a Paying Agent has been appointed under Section
4.05, the Paying Agent, for the purpose and specified in such notice of final
distribution.
The Trustee will cause to be kept at its Corporate Trust
Office in New York, New York, or at the office of its designated agent, a
Certificate Register in which, subject to such reasonable regulations as it may
prescribe, the Trustee will provide for the registration of Certificates and of
transfers and exchanges of Certificates. Upon surrender for registration of
transfer of any Certificate at any office or agency of the Trustee, or, if a
Paying Agent has been appointed under Section 4.05, the Paying Agent, maintained
for such purpose, the Trustee, or, if a Paying Agent has been appointed under
Section 4.05, the Paying Agent, will, subject to the limitations set forth in
the Agreement, authenticate and deliver, in the name of the designated
transferee or transferees, a Certificate of a like class and dated the date of
authentication by the Authenticating Agent. Notwithstanding the above, the final
distribution on this Certificate will be made after due notice by the Trustee,
or, if a Paying Agent has been appointed under Section 4.05, the Paying Agent,
of the pendency of such distribution and only upon presentation and surrender of
this Certificate at the office or agency appointed by the Trustee, or, if a
Paying Agent has been appointed under Section 4.05, the Paying Agent, for that
purpose and specified in such notice of final distribution.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof which further provisions shall for
all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication has been executed by
the Authenticating Agent, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
E-4
IN WITNESS WHEREOF, the Depositor has caused this Certificate to be duly
executed.
Dated: January 26, 2001 CHASE MORTGAGE FINANCE CORPORATION
By: ______________________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is one of the Class B-1
Certificates referred to
in the within-mentioned
Agreement.
THE CHASE MANHATTAN BANK
as Authenticating Agent
By: ________________________
Authorized Signatory
E-5
REVERSE OF CERTIFICATE
MULTI-PASS MORTGAGE PASS-THROUGH CERTIFICATE
SERIES 2001-S1
This Certificate is one of a duly authorized issue of
Certificates, designated as Multi- Class Mortgage Pass-Through Certificates,
Series 2001-S1, issued in seven Classes of Class A Certificates, one Class of
Class M Certificates and five Classes of Class B Certificates, each evidencing
an interest in certain distributions with respect to a pool of fixed rate one-
to four-family first lien Mortgage Loans formed and sold by the Depositor and
certain other property conveyed by the Depositor to the Trustee. The Class A
Certificates evidence in the aggregate the Class A Percentage of distributions
relating to repayments of principal and interest on such Mortgage Loans. The
Class M Certificates evidence in the aggregate the Class M Percentage of
distributions relating to repayments of principal and interest on such Mortgage
Loans. The Class B Certificates evidence in the aggregate the Class B Percentage
of distributions relating to repayments of principal and interest on such
Mortgage Loans.
Following the initial issuance of the Certificates, the
Principal Balance of this Certificate will be different from the Original
Denomination shown above. Anyone acquiring this Certificate may ascertain its
current Principal Balance by inquiry of the Trustee.
The Holder, by its acceptance of this Certificate, agrees that
it will look solely to the Trust Fund and certain amounts resulting from credit
enhancements for payment hereunder and that the Trustee is not liable to the
Holders for any amount payable under this Certificate or the Agreement or,
except as expressly provided in the Agreement, subject to any liability under
the Agreement.
This Certificate does not purport to summarize the Agreement
and reference is made to the Agreement for the interests, rights and limitations
of rights, benefits, obligations and duties evidenced hereby, and the rights,
duties and immunities of the Trustee.
The Trustee will cause to be kept at its Corporate Trust
Office in New York, New York, or at the office of any Paying Agent appointed
under the Agreement, a Certificate Register in which, subject to such reasonable
regulations as it may prescribe, the Trustee (or any Paying Agent, as the case
may be) will provide for the registration of Certificates and of transfers and
exchanges of Certificates. Upon surrender for registration of transfer of any
Certificate at any office or agency of the Trustee, or, if a Paying Agent has
been appointed under Section 4.05, the Paying Agent, maintained for such
purpose, the Trustee, or, if a Paying Agent has been appointed under Section
4.05, the Paying Agent, will, subject to the limitations set forth in the
Agreement, authenticate and deliver, in the name of the designated transferee or
transferees, a Certificate of a like Class and dated the date of authentication
by the Authenticating Agent.
No service charge will be made to the Holder for any transfer
or exchange of the Certificate, but the Trustee, or, if a Paying Agent has been
appointed under Section 4.05, the Paying Agent, 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 the Certificate. Prior to due
presentation of a Certificate for registration of transfer, the Depositor, the
Servicer and the Trustee may treat the person in whose name any Certificate is
registered as the owner of such Certificate and the Percentage Interest in the
Trust Fund evidenced thereby for the purpose of receiving distributions pursuant
to the Agreement and for all other purposes whatsoever, and neither the
Depositor, the Servicer, the Paying Agent nor the Trustee will be affected by
notice to the contrary.
E-6
The Agreement may be amended from time to time by the
Depositor, the Servicer and the Trustee, without the consent of any of the
Certificateholders, to cure any ambiguity, to correct or supplement any
provisions therein which may be inconsistent with the other provisions therein,
to ensure continuing treatment of the Trust Fund as a REMIC, or to make any
other provisions with respect to matters or questions arising under the
Agreement which are not materially inconsistent with the provisions of the
Agreement, provided that such action does not, as evidenced by an Opinion of
Counsel, adversely affect in any material respect the interests of any
Certificateholder or cause the Trust Fund to fail to qualify as a REMIC.
The Agreement may also be amended from time to time by the
Depositor, the Servicer and the Trustee with the consent of the Holders of
Certificates evidencing in the aggregate not less than 66-2/3% of the Percentage
Interests of each Class of Certificates affected thereby for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of the Agreement or of modifying in any manner the rights of the
Holders of Certificates of such Class; provided, however, that no such amendment
may (i) reduce in any manner the amount of, or delay the timing of, payments
received on Mortgage Loans which are required to be distributed on any
Certificate without the consent of the Holder of such Certificate, (ii) reduce
the aforesaid percentage of Certificates of any Class the Holders of which are
required to consent to any such amendment or (iii) change the percentage
specified in clause (ii) of the first paragraph of Section 11.01 of the
Agreement, without the consent of the Holders of all Certificates of such Class
then outstanding.
The Depositor intends to cause an election to be made to treat
the Trust Fund as a real estate mortgage investment conduit (a "REMIC") for
federal income tax purposes. The Class A Certificates (other than the Class A-R
Certificate), the Class M Certificates and the Class B Certificates will
constitute "regular interests" in the REMIC. The Class A-R Certificate will
represent the sole class of "residual interest" in the REMIC.
The respective obligations and responsibilities of the
Depositor, the Servicer (except the duty to pay the Trustee's fees and expenses
and indemnification hereunder) and the Trustee shall terminate upon (i) the
later of the final payment or other liquidation (or any Advance with respect
thereto) of the last Mortgage Loan or the disposition of all property acquired
upon foreclosure or deed in lieu of foreclosure of any Mortgage Loan and the
remittance of all funds due hereunder; or (ii) at the option of the Servicer, on
any Distribution Date which occurs in the month next following a Due Date on
which the aggregate unpaid Principal Balance of all Outstanding Mortgage Loans
is less than 10% of the aggregate unpaid Principal Balance of the Mortgage Loans
on the Cut-off Date, so long as the Servicer deposits or causes to be deposited
in the Collection Account during the Principal Prepayment Period related to such
Distribution Date (and provides notice to the Trustee of its intention to so
deposit on or before the 20th day of such Principal Prepayment Period) an amount
equal to the greater of (A) the Purchase Price for each Outstanding Mortgage
Loan, less any unreimbursed Advances made with respect to any Mortgage Loan
(which amount shall offset completely any unreimbursed Advances for which the
Servicer is otherwise entitled to reimbursement), and, with respect to all
property acquired in respect of any Mortgage Loan remaining in the Trust Fund,
an amount equal to the fair market value of such property, as determined by an
appraisal to be conducted by an appraiser selected by the Trustee, less
unreimbursed Advances made with respect to any Mortgage Loan with respect to
which property has been acquired and (B) the aggregate Outstanding Certificate
Principal Balance of the Class A, Class M, Class B-1 and Class B-2 Certificates,
plus any accrued and unpaid interest thereon at the Remittance Rate; provided,
however, that 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.
James's, living on the date hereof.
E-7
[FORM OF ASSIGNMENT]
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto
(PLEASE INSERT SOCIAL SECURITY* OR TAXPAYER IDENTIFICATION NUMBER OF
ASSIGNEE)
__________________________________________
_____________________________________________________________
(Please Print or Type Name and Address of Assignee)
_____________________________________________________________
the within Certificate, and all rights thereunder, and hereby does irrevocably
constitute and appoint
__________________________________________________ Attorney to transfer the
within Certificate on the books kept for the registration thereof, with full
power of substitution in the premises.
Dated:
(Signature guaranty) _______________________________
NOTICE: The signature to this assignment must
correspond with the name as it appears upon
the face of the within Certificate in every
particular, without alteration or enlargement
or any change whatever.
(*This information, which is voluntary, is being requested to ensure that the
assignee will not be subject to backup withholding under Section 3406 of the
Code.)
E-8
EXHIBIT F
FORM OF CLASS A-R CERTIFICATE
SOLELY FOR FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "RESIDUAL
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE "CODE").
THIS CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF OR INTEREST IN CHASE
MORTGAGE FINANCE CORPORATION ("CMFC"), THE SERVICER OR THE TRUSTEE REFERRED TO
BELOW OR ANY OF THEIR AFFILIATES. NEITHER THIS CERTIFICATE, THE REMIC RESIDUAL
INTEREST REPRESENTED HEREBY NOR THE UNDERLYING MORTGAGE LOANS ARE GUARANTEED OR
INSURED BY CMFC, CHASE MANHATTAN MORTGAGE CORPORATION, THE TRUSTEE OR BY ANY OF
THEIR AFFILIATES OR BY ANY GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
NO TRANSFER OF THIS CERTIFICATE SHALL BE MADE UNLESS THE TRUSTEE SHALL HAVE
RECEIVED EITHER (i) A REPRESENTATION LETTER FROM THE TRANSFEREE OF THIS
CERTIFICATE TO THE EFFECT THAT SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN
SUBJECT TO SECTION 406 OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974,
AS AMENDED ("ERISA") OR SECTION 4975 OF THE CODE OR MATERIALLY SIMILAR
PROVISIONS OF APPLICABLE FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW") (A "PLAN"),
AND IS NOT DIRECTLY OR INDIRECTLY PURCHASING ANY CERTIFICATE ON BEHALF OF, AS
INVESTMENT MANAGER OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF OR WITH ASSETS OF A
PLAN OR, IN THE CASE OF AN INSURANCE COMPANY, THE ASSETS OF ANY SEPARATE
ACCOUNTS TO EFFECT SUCH ACQUISITION, OR (ii) IF THIS CERTIFICATE IS PRESENTED
FOR REGISTRATION IN THE NAME OF A PLAN SUBJECT TO TITLE I OF ERISA, OR SECTION
4975 OF THE CODE OR SIMILAR LAW (OR COMPARABLE PROVISIONS OF ANY SUBSEQUENT
ENACTMENTS), OR A TRUSTEE OF ANY SUCH PLAN, OR ANY OTHER PERSON WHO IS USING THE
ASSETS OF ANY SUCH PLAN TO EFFECT SUCH ACQUISITION, AN OPINION OF COUNSEL TO THE
EFFECT THAT THE PURCHASE OR HOLDING OF THIS CERTIFICATE WILL NOT RESULT IN THE
ASSETS OF THE TRUST FUND BEING DEEMED TO BE "PLAN ASSETS" PURSUANT TO THE
DEPARTMENT OF LABOR PLAN ASSET REGULATIONS SET FORTH IN 29 C.F.R. ss.2510.3-101
AND TO BE SUBJECT TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF ERISA OR THE
PROHIBITED TRANSACTION PROVISIONS OF ERISA OR THE CODE OR SIMILAR LAW, WILL NOT
CONSTITUTE OR RESULT IN A PROHIBITED TRANSACTION WITHIN THE MEANING OF SECTION
406 OR SECTION 407 OF ERISA OR SECTION 4975 OF THE CODE OR SIMILAR LAW, AND WILL
NOT SUBJECT THE TRUSTEE, THE SERVICER, CMFC OR ANY OF THEIR AFFILIATES TO ANY
OBLIGATION OR LIABILITY (INCLUDING OBLIGATIONS OR LIABILITIES UNDER ERISA OR
SECTION 4975 OF THE CODE OR SIMILAR LAW) RELATING TO THE CERTIFICATES.
TRANSFERABILITY OF THIS CERTIFICATE IS RESTRICTED UNDER THE PROVISIONS OF
SECTION 4.02 OF THE AGREEMENT.
F-1
FOLLOWING THE INITIAL ISSUANCE OF THE CERTIFICATES, THE PRINCIPAL BALANCE OF
THIS CERTIFICATE WILL BE DIFFERENT FROM THE ORIGINAL DENOMINATION SHOWN BELOW.
ANYONE ACQUIRING THIS CERTIFICATE MAY ASCERTAIN ITS CURRENT PRINCIPAL BALANCE BY
INQUIRY OF THE TRUSTEE.
CLASS A-R CERTIFICATE
Number 01-S1-A-R-1 Original Denomination
$100.00
Cut-off Date: January 1, 2001 Final Scheduled
Distribution Date: February 25, 2031
First Distribution Date: Aggregate Original Principal
February 26, 2001 Balance of the Class A-R
Certificate: $100.00
Certificate Rate: ____% CUSIP: 16162T ____
F-2
MULTI-CLASS MORTGAGE PASS-THROUGH CERTIFICATE
Series 2001-S1
evidencing an ownership interest in distributions allocable to the Class A-R
Certificate with respect to a pool of conventional one- to four-family mortgage
loans formed and sold by
CHASE MORTGAGE FINANCE CORPORATION
This certifies that __________ is the registered owner of the
ownership interest (the "Ownership Interest") evidenced by this Certificate in
certain distributions with respect to a pool of conventional one- to four-family
first lien mortgage loans (the "Mortgage Loans") formed and sold by Chase
Mortgage Finance Corporation (hereinafter called the "Depositor"), and certain
other property held in trust for the benefit of Certificateholders
(collectively, the "Trust Fund"). The Mortgage Loans are serviced by Chase
Manhattan Mortgage Corporation (the "Servicer") and are secured by first
mortgages on Mortgaged Properties. The Trust Fund was created pursuant to a
Pooling and Servicing Agreement (the "Agreement"), dated as of January 1, 2001
among the Depositor, the Servicer and Citibank, N.A., as trustee (the
"Trustee"), a summary of certain of the pertinent provisions of which is set
forth hereafter. To the extent not defined herein, the capitalized terms used
herein have the meanings assigned in the Agreement.
This Certificate is one of a duly authorized issue of
Certificates, designated as Multi- Class Mortgage Pass-Through Certificates,
Series 2001-S1, Class A-R (the "Class A-R Certificate") and 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 Agreement such Holder is bound. Also issued under the
Agreement are Certificates designated as Multi- Class Mortgage Pass-Through
Certificates, Series 2001-S1, Class M Certificates (the "Class M Certificates")
and Class B Certificates (the "Class B Certificates"). The Class A Certificates,
the Class M Certificates and the Class B Certificates are collectively referred
to herein as the "Certificates."
Pursuant to the terms of the Agreement, the Trustee, or, if a
Paying Agent has been appointed under Section 4.05 thereof, the Paying Agent,
will distribute from funds in the Certificate Account the amount as described on
the reverse hereof on the 25th day of each month or, if such 25th day is not a
Business Day, the Business Day immediately following (the "Distribution Date"),
commencing on February 26, 2001. Such distributions will be made to the Person
in whose name this Certificate is registered at the close of business on the
last Business Day of the month preceding the month in which such payment is
made, or if such last day is not a Business Day, the Business Day immediately
preceding such last day.
Distributions on this Certificate will be made either by check
mailed to the address of the Person entitled thereto, as such name and address
shall appear on the Certificate Register, or by wire transfer in immediately
available funds to the account of such Holder at a bank or other financial or
depository institution having appropriate facilities therefor, if such Holder
has so notified the Paying Agent in writing at least 10 Business Days prior to
the first Distribution Date for which distribution by wire transfer is to be
made, and such Holder's Certificates evidence an aggregate original principal
balance of not less than $5,000,000 or such Holder holds a 100% Percentage
Interest of such Class. Notwithstanding the above, the final distribution on
this Certificate will be made after due notice by the Trustee, or, if a Paying
Agent has been appointed under Section 4.05, the Paying Agent, of the pendency
F-3
of such distribution and only upon presentation and surrender of this
Certificate at the office of the Trustee, or, if a Paying Agent has been
appointed under Section 4.05, the Paying Agent, or agency appointed by the
Trustee, or, if a Paying Agent has been appointed under Section 4.05, the Paying
Agent, for the purpose and specified in such notice of final distribution.
The Trustee will cause to be kept at its Corporate Trust
Office in New York, New York, or at the office of its designated agent, a
Certificate Register in which, subject to such reasonable regulations as it may
prescribe, the Trustee will provide for the registration of Certificates and of
transfers and exchanges of Certificates. Upon surrender for registration of
transfer of any Certificate at any office or agency of the Trustee, or, if a
Paying Agent has been appointed under Section 4.05, the Paying Agent, maintained
for such purpose, the Trustee, or, if a Paying Agent has been appointed under
Section 4.05, the Paying Agent, will, subject to the limitations set forth in
the Agreement, authenticate and deliver, in the name of the designated
transferee or transferees, a Certificate of a like class and dated the date of
authentication by the Authenticating Agent. Notwithstanding the above, the final
distribution on this Certificate will be made after due notice by the Trustee,
or, if a Paying Agent has been appointed under Section 4.05, the Paying Agent,
of the pendency of such distribution and only upon presentation and surrender of
this Certificate at the office or agency appointed by the Trustee, or, if a
Paying Agent has been appointed under Section 4.05, the Paying Agent, for that
purpose and specified in such notice of final distribution.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof which further provisions shall for
all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication has been executed by
the Authenticating Agent, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
F-4
IN WITNESS WHEREOF, the Depositor has caused this Certificate to be duly
executed.
Dated: January 26, 2001 CHASE MORTGAGE FINANCE
CORPORATION
By: _______________________
Authorized Officer
CERTIFICATE OF AUTHENTICATION
This is the Class A-R
Certificate referred to
in the within-mentioned
Agreement.
THE CHASE MANHATTAN BANK
as Authenticating Agent
By: ________________________
Authorized Signatory
F-5
REVERSE OF CERTIFICATE
MULTI-CLASS MORTGAGE PASS-THROUGH CERTIFICATE
SERIES 2001-S1
This Certificate is one of a duly authorized issue of
Certificates, designated as Multi- Class Mortgage Pass-Through Certificates,
Series 2001-S1, issued in seven Classes of Class A Certificates, one Class of
Class M Certificates and five Classes of Class B Certificates, each evidencing
an interest in certain distributions with respect to a pool of fixed rate one-
to four-family first lien Mortgage Loans formed and sold by the Depositor and
certain other property conveyed by the Depositor to the Trustee. The Class A
Certificates evidence in the aggregate the Class A Percentage of distributions
relating to repayments of principal and interest on such Mortgage Loans. The
Class M Certificates evidence in the aggregate the Class M Percentage of
distributions relating to repayments of principal and interest on such Mortgage
Loans. The Class B Certificates evidence in the aggregate the Class B Percentage
of distributions relating to repayments of principal and interest on such
Mortgage Loans.
Following the initial issuance of the Certificates, the
Principal Balance of this Certificate will be different from the Original
Denomination shown above. Anyone acquiring this Certificate may ascertain its
current Principal Balance by inquiry of the Trustee.
The Holder, by its acceptance of this Certificate, agrees that
it will look solely to the Trust Fund and certain amounts resulting from credit
enhancements for payment hereunder and that the Trustee is not liable to the
Holders for any amount payable under this Certificate or the Agreement or,
except as expressly provided in the Agreement, subject to any liability under
the Agreement.
This Certificate does not purport to summarize the Agreement
and reference is made to the Agreement for the interests, rights and limitations
of rights, benefits, obligations and duties evidenced hereby, and the rights,
duties and immunities of the Trustee.
The Trustee will cause to be kept at its Corporate Trust
Office in New York, New York, or at the office of any Paying Agent appointed
under the Agreement, a Certificate Register in which, subject to such reasonable
regulations as it may prescribe, the Trustee (or any Paying Agent, as the case
may be) will provide for the registration of Certificates and of transfers and
exchanges of Certificates. Upon surrender for registration of transfer of any
Certificate at any office or agency of the Trustee, or, if a Paying Agent has
been appointed under Section 4.05, the Paying Agent, maintained for such
purpose, the Trustee, or, if a Paying Agent has been appointed under Section
4.05, the Paying Agent, will, subject to the limitations set forth in the
Agreement, authenticate and deliver, in the name of the designated transferee or
transferees, a Certificate of a like Class and dated the date of authentication
by the Authenticating Agent.
No service charge will be made to the Holder for any transfer
or exchange of the Certificate, but the Trustee, or, if a Paying Agent has been
appointed under Section 4.05, the Paying Agent, 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 the Certificate. Prior to due
presentation of a Certificate for registration of transfer, the Depositor, the
Servicer and the Trustee may treat the person in whose name any Certificate is
registered as the owner of such Certificate and the Percentage Interest in
F-6
the Trust Fund evidenced thereby for the purpose of receiving distributions
pursuant to the Agreement and for all other purposes whatsoever, and neither the
Depositor, the Servicer, the Paying Agent nor the Trustee will be affected by
notice to the contrary.
The Agreement may be amended from time to time by the
Depositor, the Servicer and the Trustee, without the consent of any of the
Certificateholders, to cure any ambiguity, to correct or supplement any
provisions therein which may be inconsistent with the other provisions therein,
to ensure continuing treatment of the Trust Fund as a REMIC, or to make any
other provisions with respect to matters or questions arising under the
Agreement which are not materially inconsistent with the provisions of the
Agreement, provided that such action does not, as evidenced by an Opinion of
Counsel, adversely affect in any material respect the interests of any
Certificateholder or cause the Trust Fund to fail to qualify as a REMIC.
The Agreement may also be amended from time to time by the
Depositor, the Servicer and the Trustee with the consent of the Holders of
Certificates evidencing in the aggregate not less than 66-2/3% of the Percentage
Interests of each Class of Certificates affected thereby for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of the Agreement or of modifying in any manner the rights of the
Holders of Certificates of such Class; provided, however, that no such amendment
may (i) reduce in any manner the amount of, or delay the timing of, payments
received on Mortgage Loans which are required to be distributed on any
Certificate without the consent of the Holder of such Certificate, (ii) reduce
the aforesaid percentage of Certificates of any Class the Holders of which are
required to consent to any such amendment or (iii) change the percentage
specified in clause (ii) of the first paragraph of Section 11.01 of the
Agreement, without the consent of the Holders of all Certificates of such Class
then outstanding.
The Depositor intends to cause an election to be made to treat
the Trust Fund as a real estate mortgage investment conduit (a "REMIC") for
federal income tax purposes. The Class A Certificates (other than the Class A-R
Certificate), the Class M Certificates and the Class B Certificates will
constitute "regular interests" in the REMIC. The Class A-R Certificate will
represent the sole class of "residual interest" in the REMIC.
The respective obligations and responsibilities of the
Depositor, the Servicer (except the duty to pay the Trustee's fees and expenses
and indemnification hereunder) and the Trustee shall terminate upon (i) the
later of the final payment or other liquidation (or any Advance with respect
thereto) of the last Mortgage Loan or the disposition of all property acquired
upon foreclosure or deed in lieu of foreclosure of any Mortgage Loan and the
remittance of all funds due hereunder; or (ii) at the option of the Servicer, on
any Distribution Date which occurs in the month next following a Due Date on
which the aggregate unpaid Principal Balance of all Outstanding Mortgage Loans
is less than 10% of the aggregate unpaid Principal Balance of the Mortgage Loans
on the Cut-off Date, so long as the Servicer deposits or causes to be deposited
in the Collection Account during the Principal Prepayment Period related to such
Distribution Date (and provides notice to the Trustee of its intention to so
deposit on or before the 20th day of such Principal Prepayment Period) an amount
equal to the greater of (A) the Purchase Price for each Outstanding Mortgage
Loan, less any unreimbursed Advances made with respect to any Mortgage Loan
(which amount shall offset completely any unreimbursed Advances for which the
Servicer is otherwise entitled to reimbursement), and, with respect to all
property acquired in respect of any Mortgage Loan remaining in the Trust Fund,
an amount equal to the fair market value of such property, as determined by an
appraisal to be conducted by an appraiser selected by the Trustee, less
unreimbursed Advances made with respect to any Mortgage Loan with respect to
which property has been acquired and (B) the aggregate Outstanding Certificate
Principal Balance of the Class A, Class M, Class B-1 and Class B-2 Certificates,
plus any accrued and unpaid interest thereon at the Remittance Rate; provided,
however, that 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.
James's, living on the date hereof.
F-7
[FORM OF ASSIGNMENT]
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto
(PLEASE INSERT SOCIAL SECURITY* OR TAXPAYER IDENTIFICATION NUMBER OF
ASSIGNEE)
__________________________________________
_____________________________________________________________
(Please Print or Type Name and Address of Assignee)
_____________________________________________________________________________
the within Certificate, and all rights thereunder, and hereby does irrevocably
constitute and appoint
__________________________________________________ Attorney to transfer the
within Certificate on the books kept for the registration thereof, with full
power of substitution in the premises.
Dated:
(Signature guaranty) ____________________________________
NOTICE: The signature to this assignment must
correspond with the name as it appears upon
the face of the within Certificate in every
particular, without alteration or enlargement
or any change whatever.
(*This information, which is voluntary, is being requested to ensure that the
assignee will not be subject to backup withholding under Section 3406 of the
Code.)
F-8
EXHIBIT G
FORM OF TRUSTEE CERTIFICATION
[DATE]
Chase Mortgage Finance Corporation
000 Xxxx Xxxxxxxxx
Xxxxxxxxx Xxxx, XX 00000
Re: Pooling and Servicing Agreement dated as of January 1,
2001 among Chase Mortgage Finance Corporation, Chase
Manhattan Mortgage Corporation as servicer and Citibank,
N.A., as trustee, Multi-Class Mortgage Pass-Through
Certificates, Series 2001-S1
Ladies and Gentlemen:
In accordance with Section 2.02 of the above-captioned Pooling
and Servicing Agreement, the undersigned, as Trustee, hereby certifies that [,
except as set forth in Schedule A hereto,] as to each Mortgage Loan listed in
the Mortgage Loan Schedule attached hereto (other than any Mortgage Loan paid in
full or listed on the attachment hereto) it has reviewed the Mortgage File and
the Mortgage Loan Schedule and has determined that:
(i) All documents in the Mortgage File required to be
delivered to the Trustee pursuant to Section 2.01 of the Pooling and Servicing
Agreement are in its possession;
(ii) In connection with each Mortgage Loan or Assignment
thereof as to which documentary evidence of recording was not received on the
Closing Date, it has received evidence of such recording; and
(iii) Such documents have been reviewed by it and such
documents do not contain any material omissions or defects within the meaning of
Section 2.01 or 2.02.
The Trustee further certifies that as to each Mortgage Loan,
the Trustee holds the Mortgage Note without any Responsible Officer of the
Trustee having received written notice (a) of any adverse claims, liens or
encumbrances, (b) that any Mortgage Note was overdue or has been dishonored, (c)
of evidence on the face of any Mortgage Note or Mortgage of any security
interest therein, or (d) of any defense against or claim to the Mortgage Note by
any other party.
The Trustee has made no independent examination of any
documents contained in each Mortgage File beyond confirming (i) that the
Mortgage Loan number and the name of the Mortgagor in each Mortgage File conform
to the respective Mortgage Loan number and name listed on the Mortgage Loan
Schedule and (ii) the existence in each Mortgage File of each of the documents
listed in subparagraphs (i)(A) through (G), inclusive, of Section 2.01 in the
Agreement. The Trustee makes no representations or warranties as to the
validity, legality, sufficiency, enforceability or genuineness of any
of the documents contained in each Mortgage Loan or the collectibility,
insurability, effectiveness or suitability of any such Mortgage Loan.
Capitalized words and phrases used herein shall have the
respective meanings assigned to them in the above-captioned Pooling and
Servicing Agreement.
CITIBANK, N.A.,
as Trustee
By: _______________________________
Name: _____________________________
Title: ____________________________
G-1
EXHIBIT H
FORM OF INVESTMENT LETTER
(Accredited Investor)
[DATE]
Chase Manhattan Mortgage Corporation
000 Xxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Re: Chase Mortgage Finance Corporation
Multi-Class Mortgage Pass-Through
Certificates, Series 2001-S1, [Class B- ]
-----------------------------------------
Ladies and Gentlemen:
______________ (the "Purchaser") intends to purchase from
_________________________ (the "Transferor") $_______ by original principal
balance (the "Transferred Certificates") of Multi-Class Mortgage Pass-Through
Certificates, Series 2001-S1, [Class B- ] (the "Certificates"), issued pursuant
to a pooling and servicing agreement, dated as of January 1, 2001 (the "Pooling
and Servicing Agreement"), among Chase Mortgage Finance Corporation (the
"Depositor"), Chase Manhattan Mortgage Corporation, as Servicer (the
"Servicer"), and Citibank, N.A., as trustee (the "Trustee"). [The Purchaser
intends to register the Transferred Certificate in the name of
____________________, as nominee for __________________.] All terms used and not
otherwise defined herein shall have the meanings set forth in the Pooling and
Servicing Agreement.
For good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Purchaser certifies, represents
and warrants to, and covenants with, the Depositor and the Trustee that:
1. The Purchaser understands that (a) the Certificates have
not been registered or qualified under the Securities Act of 1933, as amended
(the "Securities Act"), or the securities laws of any state, (b) neither the
Depositor nor the Trustee is required, and neither of them intends, to so
register or qualify the Certificates, (c) the Certificates cannot be resold
unless (i) they are registered and qualified under the Securities Act and the
applicable state securities laws or (ii) an exemption from registration and
qualification is available and (d) the Pooling and Servicing Agreement contains
restrictions regarding the transfer of the Certificates.
2. The Certificates will bear a legend to the following
effect:
THIS CLASS B CERTIFICATE HAS NOT AND WILL NOT BE REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE
SECURITIES LAWS OF ANY STATE AND MAY NOT BE RESOLD OR
TRANSFERRED
H-1
UNLESS IT IS SOLD OR TRANSFERRED IN TRANSACTIONS WHICH ARE
EXEMPT FROM REGISTRATION UNDER SUCH ACT OR UNDER APPLICABLE
STATE LAW AND IS TRANSFERRED IN ACCORDANCE WITH THE PROVISIONS
OF SECTION 4.02 OF THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.
[THIS LEGEND WILL APPEAR ON THE CERTIFICATE ONLY IF SUCH
CERTIFICATE IS AN ERISA RESTRICTED CERTIFICATE.] NO TRANSFER
OF THIS CERTIFICATE SHALL BE MADE UNLESS THE DEPOSITOR SHALL
HAVE RECEIVED EITHER (i) A REPRESENTATION LETTER FROM THE
TRANSFEREE OF THIS CERTIFICATE TO THE EFFECT THAT SUCH
TRANSFEREE EITHER (A) IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT
TO SECTION 406 OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT
OF 1974, AS AMENDED ("ERISA") OR SECTION 4975 OF THE INTERNAL
REVENUE CODE OF 1986, AS AMENDED (THE "CODE") OR MATERIALLY
SIMILAR PROVISIONS OF APPLICABLE FEDERAL, STATE OR LOCAL LAW
("SIMILAR LAW") (A "PLAN"), AND IS NOT DIRECTLY OR INDIRECTLY
PURCHASING ANY CERTIFICATE ON BEHALF OF, AS INVESTMENT MANAGER
OF, AS NAMED FIDUCIARY OF, AS TRUSTEE OF OR WITH ASSETS OF A
PLAN OR, IN THE CASE OF AN INSURANCE COMPANY, THE ASSETS OF
ANY SEPARATE ACCOUNTS TO EFFECT SUCH ACQUISITION OR (B) THE
SOURCE OF FUNDS FOR THE PURCHASE OF THE CERTIFICATES IS AN
"INSURANCE COMPANY GENERAL ACCOUNT" WITHIN THE MEANING OF
PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 ("PTCE 95-60"),
60 FED. REG. 35925 (JULY 12, 1995), AND THE PURCHASE AND
HOLDING OF THE CERTIFICATES IS EXEMPT UNDER PTCE 95-60, OR
(ii) IF THIS CERTIFICATE IS PRESENTED FOR REGISTRATION IN THE
NAME OF A PLAN SUBJECT TO TITLE I OF ERISA, OR SECTION 4975 OF
THE CODE OR SIMILAR LAW (OR COMPARABLE PROVISIONS OF ANY
SUBSEQUENT ENACTMENTS), OR A TRUSTEE OF ANY SUCH PLAN, OR ANY
OTHER PERSON WHO IS USING THE ASSETS OF ANY SUCH PLAN TO
EFFECT SUCH ACQUISITION, AN OPINION OF COUNSEL TO THE EFFECT
THAT THE PURCHASE OR HOLDING OF THIS CERTIFICATE WILL NOT
RESULT IN THE ASSETS OF THE TRUST FUND BEING DEEMED TO BE
"PLAN ASSETS" PURSUANT TO THE DEPARTMENT OF LABOR PLAN ASSET
REGULATIONS SET FORTH IN 29 C.F.R. ss.2510.3-101 AND TO BE
SUBJECT TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF ERISA OR
THE PROHIBITED TRANSACTION PROVISIONS OF ERISA OR THE CODE OR
SIMILAR LAW, WILL NOT CONSTITUTE OR RESULT IN A PROHIBITED
TRANSACTION WITHIN THE MEANING OF SECTION 406 OR SECTION 407
OF ERISA OR SECTION 4975 OF THE CODE OR SIMILAR LAW, AND WILL
NOT SUBJECT THE TRUSTEE, THE SERVICER, CMFC OR ANY OF THEIR
AFFILIATES TO ANY OBLIGATION OR LIABILITY (INCLUDING
OBLIGATIONS OR LIABILITIES UNDER ERISA OR SECTION 4975 OF THE
CODE OR SIMILAR LAW) RELATING TO THE CERTIFICATES.
H-2
3. The Purchaser is acquiring the Transferred Certificates for
its own account [for investment only]* and not with a view to or for sale or
other transfer in connection with any distribution of the Transferred
Certificates in any manner that would violate the Securities Act or any
applicable state securities laws, subject, nevertheless, to the understanding
that disposition of the Purchaser's property shall at all times be and remain
within its control.
4. The Purchaser (a) is a substantial, sophisticated
institutional investor having such knowledge and experience in financial and
business matters, and in particular in such matters related to securities
similar to the Certificates, such that it is capable of evaluating the merits
and risks of investment in the Certificates, (b) is able to bear the economic
risks of such an investment and (c) is an "accredited investor" within the
meaning of Rule 501(a) promulgated pursuant to the Securities Act.
5. The Purchaser will not nor has it authorized nor will it
authorize any person to (a) offer, pledge, sell, dispose of or otherwise
transfer any Certificate, any interest in any Certificate or any other similar
security to any person in any manner, (b) solicit any offer to buy or to accept
a pledge, disposition or other transfer of any Certificate, any interest in any
Certificate or any other similar security from any person in any manner, (c)
otherwise approach or negotiate with respect to any Certificate, any interest in
any Certificate or any other similar security with any person in any manner, (d)
make any general solicitation by means of general advertising or in any other
manner, or (e) take any other action, that would constitute a distribution of
any Certificate under the Securities Act or the Investment Company Act of 1940,
as amended (the "1940 Act"), that would render the disposition of any
Certificate a violation of Section 5 of the Securities Act or any state
securities law, or that would require registration or qualification pursuant
thereto. Neither the Purchaser nor anyone acting on its behalf has offered the
Certificates for sale or made any general solicitation by means of general
advertising or in any other manner with respect to the Certificates. The
Purchaser will not sell or otherwise transfer any of the Certificates, except in
compliance with the provisions of the Pooling and Servicing Agreement.
6. [This paragraph may be deleted if the Purchaser provides
the Opinion of Counsel referred to in clause (ii) of Section 4.02(d) of the
Pooling and Servicing Agreement or if the Purchaser is purchasing an ERISA
Restricted Certificate.] The Purchaser either (A) is not an employee benefit
plan within the meaning of Section 3(3) of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), or a plan within the meaning of
Section 4975 of the Internal Revenue Code of 1986, as amended (the "Code") or
any materially similar provisions of applicable federal, state or local law
(each, a "Plan"), and is not directly or indirectly purchasing any Certificate
on behalf of, as investment manager of, as named fiduciary of, as trustee of or
with assets of a Plan or directly or indirectly purchasing any certificates with
the assets of any insurance company separate account or of any Plan or (B) is an
insurance company and the source of funds for the purchase of the certificates
is an "insurance company general account" within the meaning of Prohibited
Transaction Class Exemption 95-60 ("PTCE 95-60"), 60 Fed. Reg. 35925 (July 12,
1995), and the purchase and holding of the Certificates is exempt under PTCE
95-60.
7. Prior to the sale or transfer by the Purchaser of any of
the Certificates, the Purchaser will obtain from any subsequent purchaser
substantially the same certifications, representations, warranties and covenants
contained in the foregoing paragraphs and in this letter or a letter
substantially in the form of Exhibit I to the Pooling and Servicing Agreement.
8. The Purchaser agrees to indemnify the Trustee, the Servicer
and the Depositor against any liability that may result from any
misrepresentation made herein.
Very truly yours,
[PURCHASER]
By: _______________________
Name: _____________________
Title: ____________________
-------------------
* Not required of a broker/dealer purchaser.
H-3
EXHIBIT I
FORM OF RULE 144A INVESTMENT LETTER
(Qualified Institutional Buyer)
[DATE]
Chase Manhattan Mortgage Corporation
000 Xxxxxxxx Xxxxxx
Xxxxxx, XX 00000
The Chase Manhattan Bank
Global Trust Services
15th Floor
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Re: Chase Mortgage Finance Corporation,
Multi-Class Mortgage Pass-Through
Certificates, Series 2001-S1, [Class B- ]
-----------------------------------------
Ladies and Gentlemen:
______________ (the "Purchaser") intends to purchase from
_________________________ (the "Transferor") $_______ by original principal
balance (the "Transferred Certificates") of Multi-Class Mortgage Pass-Through
Certificates, Series 2001-S1, [Class B-] (the "Certificates"), issued pursuant
to a pooling and servicing agreement, dated as of January 1, 2001 (the "Pooling
and Servicing Agreement"), among Chase Mortgage Finance Corporation (the
"Depositor"), Chase Manhattan Mortgage Corporation, as Servicer (the
"Servicer"), and Citibank, N.A., as trustee (the "Trustee"). [The Purchaser
intends to register the Transferred Certificate in the name of
____________________, as nominee for __________________.] All terms used and not
otherwise defined herein shall have the meanings set forth in the Pooling and
Servicing Agreement.
For good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Purchaser certifies, represents
and warrants to, and covenants with, the Depositor and the Trustee that:
In connection with our acquisition of the above Transferred
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 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 Transferred
Certificates and all matters relating
I-1
thereto or any additional information deemed necessary to our decision to
purchase the Transferred Certificates, (d) we are not an employee benefit plan
within the meaning of Section 3(3) of the Employee Retirement Income Security
Act of 1974, as amended, or a plan within the meaning of Section 4975 of the
Internal Revenue Code of 1986, as amended or any retirement plan or other
employee benefit plan subject to any federal, state or local law materially
similar to the foregoing provisions of ERISA or the Code (each, a "Plan"), nor
are we directly or indirectly purchasing any Certificate on behalf of, as
investment manager of, as named fiduciary of, as trustee of or with assets of a
Plan or directly or indirectly purchasing any certificates with the assets of
any insurance company separate account or of any Plan [or alternatively, if we
are an insurance company, the source of funds for the purchase of the
certificates] is an "insurance company general account" within the meaning of
Prohibited Transaction Class Exemption 95-60 ("PTCE 95-60"), 50 Fed. Reg. 35925
(July 12, 1995), and the purchase and holding of the Certificates is exempt
under PTCE 95-60, (e) 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, (f) we are a "qualified institutional buyer" as that term is
defined in Rule 144A under the Securities Act and have completed one of the
forms of certification to that effect attached hereto as Annex 1 or Annex 2. We
are aware that the sale of the Transferred Certificates to us is being made in
reliance on Rule 144A. We are acquiring the Transferred 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 by us, based upon certifications of such purchaser or
information we have in our possession, 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.
We agree to indemnify the Trustee, the Servicer and the
Depositor against any liability that may result from any misrepresentation made
herein.
Very truly yours,
[PURCHASER]
By: ___________________________
Name: _________________________
Title: ________________________
X-0
XXXXX 0
XXXXXXXXX XXXXXXXXXXXXX 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 the 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 $____________* 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 Federal, 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
such institution 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.
------------------
* Buyer must own and/or invest on a discretionary basis at least $100,000,000
in securities unless Buyer is a dealer, and, in that case, Buyer must own
and/or invest on a discretionary basis at least $10,000,000 in securities.
I-3
____ Broker-dealer. The Buyer is a dealer registered
pursuant to Section 15 of the Securities Exchange Act
of 1934, as amended.
____ 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 the State,
territory or the District of Columbia.
____ 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, as amended.
____ Investment Advisor. The Buyer is an investment
advisor registered under the Investment Advisors Act
of 1940, as amended.
____ 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, as
amended.
____ Business Development Company. Buyer is a business
development company as defined in Section 202(a)(22)
of the Investment Advisors Act of 1940, as amended.
3. The term "securities" as used for purposes of the
calculation of the dollar amount in paragraph 2 excludes: (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 as provided above, the Buyer agrees that it will
furnish to such parties updated annual financial statements promptly after they
become available.
By: __________________________
Name: ________________________
Title: _______________________
Date: ________________________
I-4
ANNEX 2
-------
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 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.
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.
By: _________________________________
Name: _______________________________
Title: ______________________________
IF AN ADVISER:
_____________________________________
Print Name of Buyer
Date: _______________________________
I-5
EXHIBIT J
FORM OF SPECIAL SERVICING AND COLLATERAL FUND AGREEMENT
-------------------------------------------------------
This SPECIAL SERVICING AND COLLATERAL FUND AGREEMENT (the
"Agreement") is made and entered into as of [DATE], between Chase Manhattan
Mortgage Corporation, (the "Company") and _____________________ (the
"Purchaser").
PRELIMINARY STATEMENT
__________________ (the "Owner") is the holder of the entire
interest in Chase Mortgage Finance Corporation Multi-Class Mortgage Pass-Through
Certificates, Series 2001-S1, Class B-5 (the "Class B-5 Certificates"). The
Class B-5 Certificates were issued pursuant to a Pooling and Servicing Agreement
dated as of January 1, 2001 (the "Pooling and Servicing Agreement") among Chase
Mortgage Finance Corporation, (the "Company"), Chase Manhattan Mortgage
Corporation as servicer thereunder (the "Servicer") and Citibank, N.A., as
trustee (the "Trustee").
The Owner intends to resell all of the Class B-5 Certificates
directly to the Purchaser on or promptly after the date hereof.
In connection with such sale, the parties hereto have agreed
that the Company, as Servicer, will engage in certain special servicing
procedures relating to foreclosures for benefit of the Purchaser, and that the
Purchaser will deposit funds in a collateral fund to cover any losses
attributable to such procedures as well as all advances and costs in connection
therewith, as set forth herein.
In consideration of the mutual agreements herein contained,
the receipt and sufficiency of which are hereby acknowledged, the Company and
the Purchaser agree to the following:
ARTICLE II.
DEFINITIONS
Section 1.01. Defined Terms.
Whenever used in this Agreement, the following words and
phrases, unless the context otherwise requires, shall have the following
meanings:
Business Day: Any day other than (i) a Saturday or a Sunday or
(ii) a day on which banking institutions in the State of New York are required
or authorized by law or executive order to be closed.
Collateral Fund: The fund established and maintained pursuant
to Section 3.01 hereof.
Collateral Fund Permitted Investments: Either: (i) obligations
of, or obligations fully guaranteed as to principal and interest by, the United
States, or any agency or instrumentality thereof,
J-1
provided such obligations are backed by the full faith and credit of the United
States, (ii) a money market fund rated in the highest rating category by a
nationally recognized rating agency selected by the Company, (iii) cash, (iv)
mortgage pass-through certificates issued or guaranteed by GNMA, FNMA or FHLMC,
(v) commercial paper (including both non-interest bearing discount obligations
and interest bearing obligations payable on demand or on a specified date), the
issuer of which may be an affiliate of the Company, having at the time of such
investment a rating of at least Prime-1 by Xxxxx'x Investors Service, Inc.
("Moody's") or at least D-1 by Standard & Poor's, a Division of the XxXxxx-Xxxx
Companies, Inc. ("S&P") and (vi) demand and time deposits in, certificates of
deposit of, any depository institution or trust company (which may be an
affiliate of the Company) 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 banking authorities, so long as at the time of such
investment either (x) the long-term debt obligations of such depository
institution or trust company have a rating of at least Aa by Moody's or at least
AA by S&P or (y) the certificate of deposit or other unsecured short-term debt
obligations of such depository institution or trust company have a rating of at
least A-1 by S&P or Prime-1 by Moody's and, for each of the preceding clauses
(i), (iv), (v) and (vi), the maturity thereof shall be not later than the
earlier to occur of (A) 30 days from the date of the related investment and (B)
the next succeeding Distribution Date.
Commencement of Foreclosure: The first official action
required under local law in order to commence foreclosure proceedings or to
schedule a trustee's sale under a deed of trust, including (i) in the case of a
mortgage, any filing or service of process necessary to commence an action to
foreclose, or (ii) in the case of a deed of trust, the posting, publishing,
filing or delivery of a notice of sale, but not including in either case (x) any
notice of default, notice of intent to foreclose or sell or any other action
prerequisite to the actions specified in (i) or (ii) above and upon the consent
of the Purchaser which will be deemed given unless expressly withheld within two
Business Days of notification, (y) the acceptance of a deed-in-lieu of
foreclosure (whether in connection with a sale of the related property or
otherwise) or (z) initiation and completion of a short pay-off.
Current Appraisal: With respect to any Mortgage Loan as to
which the Purchaser has made an Election to Delay Foreclosure, an appraisal of
the related Mortgaged Property (or Underlying Mortgaged Property, in the case of
a Co-op Loan), obtained by the Purchaser at its expense from an appraiser (which
shall not be an affiliate of the Purchaser) acceptable to the Company as nearly
contemporaneously as practicable to the time of the Purchaser's election,
prepared based on the Company's customary requirements for such appraisals.
Election to Delay Foreclosure: Any election by the Purchaser
to delay the Commencement of Foreclosure, made in accordance with Section
2.02(b).
Election to Foreclose: Any election by the Purchaser to
proceed with the Commencement of Foreclosure, made in accordance with Section
2.03(a).
Required Collateral Fund Balance: As of any date of
determination, an amount equal to the aggregate of all amounts previously
required to be deposited in the Collateral Fund pursuant to Section 2.02(d)
(after adjustment for all withdrawals and deposits pursuant to Section 2.02(e))
and Section 2.03(b) (after adjustment for all withdrawals and deposits pursuant
to Section 2.03(c)) and Section 3.02 to be reduced by all withdrawals therefrom
pursuant to Section 2.02(g) and Section 2.03(d).
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Section 1.02. Definitions Incorporated by Reference.
All capitalized terms not otherwise defined in this Agreement
shall have the meanings assigned in the Pooling and Servicing Agreement.
ARTICLE III.
SPECIAL SERVICING PROCEDURES
Section 2.01. Reports and Notices.
(1) In connection with the performance of its duties under the
Pooling and Servicing Agreement relating to the realization upon defaulted
Mortgage Loans, the Company, as Servicer, shall provide to the Purchaser the
following notices and reports:
(a) Within five Business Days after each Distribution Date
(or included in or with the monthly statement to Certificateholders
pursuant to the Pooling and Servicing Agreement), the Company shall
provide to the Purchaser a report indicating for the Trust the number
of Mortgage Loans that are (A) thirty days, (B) sixty days, (C) ninety
days or more delinquent or (D) in foreclosure, and indicating for each
such Mortgage Loan the outstanding principal balance.
(b) Prior to the Commencement of Foreclosure in connection
with any Mortgage Loan, the Company shall provide the Purchaser with a
notice (sent by telecopier) of such proposed and imminent foreclosure,
stating the loan number and the aggregate amount owing under the
Mortgage Loan.
(2) If requested by the Purchaser, the Company shall make its
servicing personnel available (during their normal business hours) to respond to
reasonable inquiries by the Purchaser in connection with any Mortgage Loan
identified in a report under subsection (a)(i)(B), (a)(i)(C), (a)(i)(D) or
(a)(ii) which has been given to the Purchaser; provided, that (1) the Company
shall only be required to provide information that is readily accessible to its
servicing personnel and is non-confidential and (2) the Company shall not be
required to provide any written information under this subsection.
(3) In addition to the foregoing, the Company shall provide to
the Purchaser such information as the Purchaser may reasonably request
concerning each Mortgage Loan that is at least sixty days delinquent and each
Mortgage Loan which has become real estate owned, through the final liquidation
thereof; provided that the Company shall only be required to provide information
that is readily accessible to its servicing personnel and is non-confidential.
(d) With respect to all Mortgage Loans which are serviced at
any time by the Company through a Subservicer, the Company shall be entitled to
rely for all purposes hereunder, including for purposes of fulfilling its
reporting obligations under this Section 2.01 on the accuracy and completeness
of any information provided to it by the applicable Subservicer.
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Section 2.02. Purchaser's Election to Delay Foreclosure
Proceedings.
(a) The Purchaser directs the Company that in the event that
the Company does not receive written notice of the Purchaser's election pursuant
to subsection (b) below within 24 hours (exclusive of any intervening
non-Business Days) of transmission of the notice provided by the Company under
Section 2.01(a)(ii), subject to extension as set forth in Section 2.02(b), the
Company shall proceed with the Commencement of Foreclosure in respect of such
Mortgage Loan in accordance with its normal foreclosure policies without further
notice to the Purchaser. Any foreclosure that has been initiated may be
discontinued (i) without notice to the Purchaser, if the Mortgage Loan has been
brought current or if a refinancing or prepayment occurs with respect to the
Mortgage Loan (including by means of a short payoff approved by the Company)
(ii) with notice to the Purchaser if the Company has reached the terms of a
forbearance agreement with the borrower. In such latter case the Company may
complete such forbearance agreement unless instructed otherwise by the Purchaser
within one Business Day of notification.
(b) In connection with any Mortgage Loan with respect to which
a notice under Section 2.01(a)(ii) has been given to the Purchaser, the
Purchaser may elect, for reasonable cause as determined by the Purchaser, to
instruct the Company to delay the Commencement of Foreclosure until such term as
the Purchaser determines that the Company may proceed with the Commencement of
Foreclosure. Such election must be evidenced by written notice received within
24 hours (exclusive of any intervening non-Business Days) of transmission of the
notice provided by the Company under Section 2.01(a)(ii). Such 24 hour period
shall be extended for no longer than an additional four Business Days after the
receipt of the information if the Purchaser requests additional information
related to such foreclosure; provided, however that the Purchaser will have at
least one Business Day to respond to any requested additional information. Any
such additional information shall (i) not be confidential in nature and (ii) be
obtainable by the Company from existing reports, certificates or statements or
otherwise be readily accessible to its servicing personnel. The Purchaser agrees
that it has no right to deal with the Mortgagor. If the Company's normal
foreclosure policy includes acceptance of a deed-in-lieu of foreclosure or short
payoff, the Purchaser will be notified and given one Business Day to respond.
(c) With respect to any Mortgage Loan as to which the
Purchaser has made an Election to Delay Foreclosure, the Purchaser shall obtain
a Current Appraisal as soon as practicable, and shall provide the Company with a
copy of such Current Appraisal.
(4) Within two Business Days of making any Election to Delay
Foreclosure, the Purchaser shall remit by wire transfer to the Company, for
deposit in the Collateral Fund, an amount, as calculated by the Company, equal
to the sum of (i) 125% of the greater of the outstanding Principal Balance of
the Mortgage Loan and the value shown in the Current Appraisal referred to in
subsection (c) above (or, if such Current Appraisal has not yet been obtained,
the Company's estimate thereof, in which case the required deposit under this
subsection shall be adjusted upon obtaining of such Current Appraisal), and (ii)
three months' interest on the Mortgage Loan at the applicable Mortgage Rate. If
any Election to Delay Foreclosure extends for a period in excess of three months
(such excess period being referred to herein as the "Excess Period"), the
Purchaser shall remit by wire transfer in advance to the Company for deposit in
the Collateral Fund the amount, as calculated by the Company, equal to interest
on the Mortgage Loan at the applicable Mortgage Rate for the Excess Period. The
terms of this Agreement shall no longer apply to the servicing of any Mortgage
Loan upon the failure of the Purchaser
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to deposit the above amounts relating to the Mortgage Loan within two Business
Days of the Election to Delay Foreclosure.
(5) With respect to any Mortgage Loan as to which the
Purchaser has made an Election to Delay Foreclosure, the Company may withdraw
from the Collateral Fund from time to time amounts necessary to reimburse the
Company for all Advances and Liquidation Expenses thereafter made by the Company
as Servicer in accordance with the Pooling and Servicing Agreement. To the
extent that the amount of any such Liquidation Expense is determined by the
Company based on estimated costs, and the actual costs are subsequently
determined to be higher, the Company may withdraw the additional amount from the
Collateral Fund. In the event that the Mortgage Loan is brought current by the
Mortgagor and the foreclosure action is discontinued, the amounts so withdrawn
from the Collateral Fund shall be redeposited therein as and to the extent that
reimbursement therefor from amounts paid by the Mortgagor is not prohibited
pursuant to the Pooling and Servicing Agreement. Except as provided in the
preceding sentence, amounts withdrawn from the Collateral Fund to cover Advances
and Liquidation Expenses shall not be redeposited therein or otherwise
reimbursed to the Purchaser. If and when any such Mortgage Loan is brought
current by the Mortgagor, all amounts remaining in the Collateral Fund in
respect of such Mortgage Loan (after adjustment for all withdrawals and deposits
pursuant to this subsection) shall be released to the Purchaser.
(6) With respect to any Mortgage Loan as to which the
Purchaser has made an Election to Delay Foreclosure, the Company shall continue
to service the Mortgage Loan in accordance with its customary procedures (other
than the delay in Commencement of Foreclosure as provided herein). If and when
the Purchaser shall notify the Company that it believes that it is appropriate
to do so, the Company shall proceed with the Commencement of Foreclosure. In any
event, if the Mortgage Loan is not brought current by the Mortgagor by the time
the loan becomes 6 months delinquent, the Purchaser's election shall no longer
be effective and at the Purchaser's option, either (i) the Purchaser shall
purchase the Mortgage Loan from the Trust Fund at a purchase price equal to the
fair market value as shown on the Current Appraisal, to be paid by (x) applying
any balance in the Collateral Fund to such purchase price, and (y) to the extent
of any deficiency, by wire transfer of immediately available funds to the
Company or Trustee; or (ii) the Company shall proceed with the Commencement of
Foreclosure.
(7) Upon the occurrence of a liquidation with respect to any
Mortgage Loan as to which the Purchaser made an Election to Delay Foreclosure
and as to which the Company proceeded with the Commencement of Foreclosure in
accordance with subsection (f) above, the Company shall calculate the amount, if
any, by which the value shown on the Current Appraisal obtained under subsection
(c) exceeds the actual sales price obtained for the related Mortgaged Property
(net of Liquidation Expenses and accrued interest related to the extended
foreclosure period), and the Company shall withdraw the amount of such excess
from the Collateral Fund, shall remit the same to the Trust Fund and in its
capacity as Servicer shall apply such amount as additional Liquidation Proceeds
pursuant to the Pooling and Servicing Agreement. After making such withdrawal,
all amounts remaining in the Collateral Fund in respect of such Mortgage Loan
(after adjustment for all withdrawals and deposits pursuant to subsection (e))
shall be released to the Purchaser.
Section 2.03. Purchaser's Election to Commence Foreclosure
Proceedings.
(a) In connection with any Mortgage Loan identified in a
report under Section 2.01(a)(i)(B), the Purchaser may elect, for reasonable
cause as determined by the Purchaser, to instruct
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the Company to proceed with the Commencement of Foreclosure as soon as
practicable. Such election must be evidenced by written notice received by the
Company by 5:00 p.m., New York City time, on the third Business Day following
the delivery of such report under Section 2.01(a)(i).
(b) Within two Business Days of making any Election to
Foreclose, the Purchaser shall remit to the Company, for deposit in the
Collateral Fund, an amount, as calculated by the Company, equal to 125% of the
current Principal Balance of the Mortgage Loan and three months' interest on the
Mortgage Loan at the applicable Mortgage Rate. If and when any such Mortgage
Loan is brought current by the Mortgagor, all amounts in the Collateral Fund in
respect of such Mortgage Loan shall be released to the Purchaser. The terms of
this Agreement shall no longer apply to the servicing of any Mortgage Loan upon
the failure of the Purchaser to deposit the above amounts relating to the
Mortgage Loans within two Business Days at the Election to Foreclose.
(c) With respect to any Mortgage Loan as to which the
Purchaser has made an Election to Foreclose, the Company shall continue to
service the Mortgage Loan in accordance with its customary procedures (other
than to proceed with the Commencement of Foreclosure as provided herein). In
connection therewith, the Company shall have the same rights to make withdrawals
for Advances and Liquidation Expenses from the Collateral Fund as are provided
under Section 2.02(e), and the Company shall make reimbursements thereto to the
limited extent provided under such subsection. The Company shall not be required
to proceed with the Commencement of Foreclosure if (i) the same is stayed as a
result of the Mortgagor's bankruptcy or is otherwise barred by applicable law,
or to the extent that all legal conditions precedent thereto have not yet been
complied with or (ii) the Company believes there is a breach of representation
or warranties by the Company, which may result in a repurchase or substitution
of such Mortgage Loan, or (iii) the Company reasonably believes the Mortgaged
Property (or Underlying Mortgaged Property, in the case of a Co-op Loan) may be
contaminated with or affected by hazardous wastes or hazardous substances (and
the Company supplies the Purchaser with information supporting such belief). The
Company will repurchase or substitute a Mortgage Loan pursuant to the preceding
clause (ii) within the time period specified in the Pooling and Servicing
Agreement. Any foreclosure that has been initiated may be discontinued (i)
without notice to the Purchaser if the Mortgage Loan has been brought current or
if a refinancing or prepayment occurs with respect to the Mortgage Loan
(including by means of a short payoff approved by the Company), or (ii) with
notice to the Purchaser if the Company has reached the terms of a forbearance
agreement unless instructed otherwise by the Purchaser within two Business Days
of notification.
(d) Upon the occurrence of a liquidation with respect to any
Mortgage Loan as to which the Purchaser made an Election to Foreclose and as to
which the Company proceeded with the Commencement of Foreclosure in accordance
with subsection (c) above, the Company shall calculate the amount, if any, by
which the Principal Balance of the Mortgage Loan at the time of liquidation
(plus all unreimbursed Advances and Liquidation Expenses in connection therewith
other than those paid from the Collateral Fund) exceeds the actual sales price
obtained for the related Mortgaged Property, and the Company shall withdraw the
amount of such excess from the Collateral Fund, shall remit the same to the
Trust Fund and in its capacity as Servicer shall apply such amount as additional
Liquidation Proceeds pursuant to the Pooling and Servicing Agreement. After
making such withdrawal, all amounts remaining in the Collateral Fund (after
adjustment for all withdrawals and deposits pursuant to subsection (c)) in
respect of such Mortgage Loan shall be released to the Purchaser.
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Section 2.04. Termination.
(a) With respect to all Mortgage Loans included in the Trust
Fund, the Purchaser's rights to make any Election to Delay Foreclosure or any
Election to Foreclose and the Company's obligations under Section 2.01 shall
terminate (i) at such time as the Certificate Principal Balance of the Class B-5
Certificates has been reduced to zero, (ii) if the greater of (x) 43% (or such
lower or higher percentages that represents the Company's actual historical loss
experience with respect to the Mortgage Loans in the related pool) of the
aggregate principal balance of all Mortgage Loans that are in foreclosure or are
more than 90 days delinquent on a contractual basis and REO properties or if the
aggregate amount that the Company estimates will be required to be withdrawn
from the Collateral Fund with respect to Mortgage Loans as to which the
Purchaser has made an Election to Delay Foreclosure or an Election to Foreclose
exceeds (z) the Outstanding Certificate Principal Balance of the Class B-5
Certificates, or (iii) upon any transfer by the Purchaser of any interest (other
than the minority interest therein, but only if the transferee provides written
acknowledgment to the Company of the Purchaser's right hereunder and that such
transferee will have no rights hereunder) in the Class B-5 Certificates (whether
or not such transfer is registered under the Pooling and Servicing Agreement),
including any such transfer in connection with a termination of the Trust Fund.
Except as set forth above, this Agreement and the respective rights, obligations
and responsibilities of the Purchaser and the Company hereunder shall terminate
upon the later to occur of (i) the final liquidation of the last Mortgage Loan
as to which the Purchaser made any Election to Delay Foreclosure or any Election
to Foreclose and the withdrawal of all remaining amounts in the Collateral Fund
as provided herein and (ii) ten (10) Business Day's notice.
(b) Purchaser's rights pursuant to Section 2.02 or 2.03 of
this Agreement shall terminate with respect to a Mortgage loan as to which the
Purchaser has exercised its rights under Section 2.02 or 2.03 hereof, upon
Purchaser's failure to deposit any amounts required pursuant to Section 2.02(d)
or 2.03(b).
(c) Neither the Servicer nor any of its directors, officers,
employees or agents shall be under any liability 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 Servicer or any such Person against any liability which
would otherwise be imposed by reason of willful misfeasance, bad faith or gross
negligence in the performance of duties or by reason of reckless disregard of
obligations and duties hereunder. The Servicer and any director, officer,
employee or agent thereof may rely in good faith on any document of any kind
prima facie properly executed and submitted by an Person respecting any matters
arising hereunder.
ARTICLE IV.
COLLATERAL FUND; SECURITY INTEREST
Section 3.01. Collateral Fund.
Upon receipt from the Purchaser of the initial amount required
to be deposited in the Collateral Fund pursuant to Article 11, the Company shall
establish and maintain with itself as a segregated account on its books and
records an account (the "Collateral Fund"), entitled "Chase Manhattan Mortgage
Corporation, as Servicer, for the benefit of registered holders of Chase
Mortgage Finance Corporation Multi-Class Mortgage Pass-Through Certificates,
Series 2001-S1, Class B-5."
J-7
Amounts in the Collateral Fund shall continue to be the property of the
Purchaser, subject to the first priority security interest granted hereunder for
the benefit of the Certificate holders, until withdrawn from the Collateral Fund
pursuant to Section 2.02 or 2.03 hereof.
Upon the termination of this Agreement and the liquidation of
all Mortgage Loans as to which the Purchaser has made any Election to Delay
Foreclosure or any Election to Foreclose pursuant to Section 2.04 hereof, the
Company shall distribute to the Purchaser all amounts remaining in the
Collateral Fund together with any investment earnings thereon.
The Collateral Fund shall be an "outside reserve fund" within
the meaning of the REMIC Provisions, beneficially owned by the Purchaser, who
shall report all income, gain or loss with respect thereto. Any amounts
transferred from the Trust Fund to the Collateral Fund shall be deemed to be
transferred to the Purchaser, as beneficial owner of the Collateral Fund. In no
event shall the Purchaser (i) take or cause the Trustee or the Company to take
any action that could cause any REMIC established under the Trust Agreement to
fail to qualify as a REMIC or cause the imposition on any such REMIC of any
"prohibited transaction" or "prohibited contribution" taxes or (ii) cause the
Trustee or the Company to fail to take any action necessary to maintain the
status of any such REMIC as a REMIC.
Section 3.02. Collateral Fund Permitted Investments.
The Company shall, at the written direction of the Purchaser
invest the funds in the Collateral Fund in Collateral Fund Permitted
Investments. Such direction shall not be changed more frequently than quarterly.
In the absence of any direction, the Company shall select such investments in
accordance with the definition of Collateral Fund Permitted Investments in its
discretion.
All income and gain realized from any investment as well as
any interest earned on deposits in the Collateral Fund (net of any losses on
such investments) and any payments of principal made in respect of any
Collateral Fund Permitted Investment shall be deposited in the Collateral Fund
upon receipt. All costs and realized losses associated with the purchase and
sale of Collateral Fund Permitted Investments shall be borne by the Purchaser
and the amount of net realized losses shall be deposited by the Purchaser in the
Collateral Fund. The Company shall periodically (but not more frequently than
monthly) distribute to the Purchaser upon request an amount of cash, to the
extent cash is available therefor in the Collateral Fund, equal to the amount by
which the balance of the Collateral Fund, after giving effect to all other
distributions to be made from the Collateral Fund on such date, exceeds the
Required Collateral Fund Balance. Any amounts so distributed shall be released
from the lien and security interest of this Agreement.
Section 3.03. Grant of Security Interest.
The Purchaser grants to the Company and the Trustee for the
benefit of the Certificateholders a security interest in and lien on all of the
Purchaser's right, title and interest, whether now owned or hereafter acquired,
in and to: (1) the Collateral Fund, (2) all amounts deposited in the Collateral
Fund and Collateral Fund Permitted Investments in which such amounts are
invested (and the distributions and proceeds of such investments) and (3) all
cash and non-cash proceeds of any of the foregoing, including proceeds of the
voluntary or involuntary conversion thereof (all of the foregoing collectively,
the "Collateral").
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The Purchaser acknowledges the lien on and security interest
in the Collateral for the benefit of the Certificateholders. The Purchaser shall
take all actions requested by the Company or the Trustee as may be reasonably
necessary to perfect the security interest created under this Agreement in the
Collateral and cause it to be prior to all other security interests and liens,
including the execution and delivery to the Company for filing of appropriate
financing statements in accordance with applicable law. The Company shall file
appropriate continuation statements, or appoint an agent on its behalf to file
such statements, in accordance with applicable law.
Section 3.04. Collateral Shortfalls.
In the event that amounts on deposit in the Collateral Fund at
any time are insufficient to cover any withdrawals therefrom that the Company or
the Trustee is then entitled to make hereunder, the Purchaser shall be obligated
to pay such amounts to the Company or the Trustee immediately upon demand. Such
obligation shall constitute a general corporate obligation of the Purchaser.
ARTICLE V.
MISCELLANEOUS PROVISIONS
Section 4.01. Amendment.
This Agreement may be amended from time to time by the Company
and the Purchaser by written agreement signed by the Company and the Purchaser.
Section 4.02. Counterparts.
This Agreement may be executed simultaneously in any number of
counterparts, each of which counterparts shall be deemed to be an original, and
such counterparts shall constitute but one and the same instrument.
Section 4.03. Governing Law.
This Agreement shall be construed in accordance with the laws
of the State of New York and the obligations, rights and remedies of the parties
hereunder shall be determined in accordance with such laws.
Section 4.04. Notices.
All demands, notices and direction hereunder shall be in
writing or by telecopy and shall be deemed effective upon receipt to:
(1) in the case of the Company,
Chase Manhattan Mortgage Corporation
000 Xxxxxxxx Xxxxxx
Xxxxxx, XX 00000
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such other address as may hereafter be furnished in writing by the Company, or
(2) in the case of the Purchaser, with respect to notices
pursuant to Section 2.01,
[PURCHASER]
_______________________________________
[ADDRESS]
Attn: _________________________________
Phone: ________________________________
Fax: __________________________________
with respect to all other notices pursuant to this Agreement,
_______________________________________
[ADDRESS]
Attn: _________________________________
Phone: ________________________________
Fax: __________________________________
or such other address as may hereafter be furnished in writing by the Purchaser.
Section 4.05. Severability of Provisions.
If any one or more of the covenants, agreements, provisions or
terms of this Agreement shall be for any reason whatsoever, including
regulatory, 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.
Section 4.06. Successors and Assigns.
The provisions of this Agreement shall be binding upon and
inure to the benefit of the respective successors and assigns of the parties
hereto, and all such provisions shall inure to the benefit of the
Certificateholders; provided, however, that the rights under this Agreement
cannot be assigned by the Purchaser without the consent of the Company.
Section 4.07. Article and Section Headings.
The article and section headings herein are for convenience of
reference only, and shall not limit or otherwise affect the meaning hereof.
Section 4.08. Confidentiality.
The Purchaser agrees that all information supplied by or on
behalf of the Company pursuant to Sections 2.01 or 2.02, including individual
account information, is the property of the Company and the Purchaser agrees to
hold such information confidential and not to disclose such information.
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IN WITNESS WHEREOF, the Company and the Purchaser 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.
CHASE MANHATTAN MORTGAGE
CORPORATION
By: __________________________
Name: ________________________
Title: _______________________
By: __________________________
Name: ________________________
Title: _______________________
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EXHIBIT K
FORM OF TRANSFEREE'S LETTER
CHASE MORTGAGE FINANCE CORPORATION SERIES 2001-S1
[DATE]
Chase Mortgage Finance Corporation
000 Xxxx Xxxxxxxxx
Xxxxxxxxx Xxxx, XX 00000
Ladies and Gentlemen:
We propose to purchase Chase Mortgage Finance Corporation's
Multi-Class Mortgage Pass-Through Certificates, Series 2001-S1, Class A-R,
described in the Prospectus Supplement, dated January 25, 2001 and Prospectus,
dated January 25, 2001.
1. We certify that (a) we are not a disqualified organization
and (b) we are not purchasing such Class A-R Certificate on behalf of a
disqualified organization; for this purpose the term "disqualified organization"
means the United States, any state or political subdivision thereof, any foreign
government, any international organization, any agency or instrumentality of any
of the foregoing (except any entity treated as other than an instrumentality of
the foregoing for purposes of Section 168(h)(2)(D) of the Internal Revenue Code
of 1986, as amended (the "Code")), any organization (other than a cooperative
described in Section 521 of the Code) that is exempt from taxation under the
Code (unless such organization is subject to tax on excess inclusions) and any
organization that is described in Section 1381(a)(2)(C) of the Code. We
understand that any breach by us of this certification may cause us to be liable
for an excise tax imposed upon transfers to disqualified organizations.
2. We certify that we are not an employee benefit plan subject
to Section 406 of the Employee Retirement Income Security Act of 1974, as
amended ("ERISA") or Section 4975 of the Code or materially similar provisions
or applicable federal, state or local law, nor a person acting on behalf of any
such plan or using the assets of such plan, or, alternatively, in the case of an
insurance company, the assets of any separate accounts to effect such
acquisition.
3. We certify that (a) we have historically paid our debts as
they became due, (b) we intend, and believe that we will be able, to continue to
pay our debts as they become due in the future, (c) we understand that, as
beneficial owner of the Class A-R Certificate, we may incur tax liabilities in
excess of any cash flows generated by the Class A-R Certificate, and (d) we
intend to pay any taxes associated with holding the Class A-R Certificate as
they become due.
K-1
4. We acknowledge that we will be the beneficial owner of the
Class A-R Certificate and:*
______ The Class A-R Certificate will be registered
in our name.
______ The Class A-R Certificate will be held in the
name of our nominee, ____________________,
which is not a disqualified organization.
5. Unless Chase Mortgage Finance Corporation ("CMFC") has
consented to the transfer to us by executing the form of Consent affixed hereto
as Appendix B, we certify that we are a U.S. person; for this purpose the term
"U.S. Person" means a citizen or resident of the United States, a corporation or
partnership (unless, in the case of a partnership, Treasury regulations are
adopted that provide otherwise) created or organized in or under the laws of the
United States, any state thereof or the District of Columbia, including an
entity treated as a corporation or partnership for federal income tax purposes,
an estate whose income is subject to Unites States federal income tax regardless
of its source, or a trust if a court within the United States is able to
exercise primary supervision over the administration of such trust, and one or
more such U.S. Persons have the authority to control all substantial decisions
of such trust, (or, to the extent provided in applicable Treasury regulations,
certain trusts in existence on August 20, 1996 which are eligible to elect to be
treated as U.S. Persons). We agree that any breach by us of this certification
shall render the transfer of any interest in the Class A-R Certificate to us
absolutely null and void and shall cause no rights in the Class A-R Certificate
to vest in us.
6. We agree that in the event that at some future time we wish
to transfer any interest in the Class A-R Certificate, we will transfer such
interest in the Class A-R Certificate only (a) to a transferee that (i) is not a
disqualified organization and is not purchasing such interest in the Class A-R
Certificate on behalf of a disqualified organization, (ii) is a U.S. person and
(iii) has delivered to CMFC a letter in the form of this letter (including the
affidavit appended hereto) and, if requested by CMFC, an opinion of counsel (in
a form acceptable to CMFC) that the proposed transfer will not cause the
interest in the Class A-R Certificate to be held by a disqualified organization
or a person who is not a U.S. person or (b) with the written consent of CMFC.
7. We hereby designate Chase Manhattan Mortgage Corporation as
our fiduciary to act as the tax matters person for the Series 2001-S1 REMIC.
Very truly yours,
[PURCHASER]
By: _______________________
Name: _____________________
Title: ____________________
Accepted as of ____________, 200_
CHASE MORTGAGE FINANCE CORPORATION
By: ______________________________
Name: ____________________________
Title: ___________________________
-----------------
* Check appropriate box and if necessary fill in the name of the Transferee's
nominee.
K-2
APPENDIX A
Affidavit pursuant to (i) Section 860E(e)(4) of the Internal Revenue Code of
1986, as amended, and (ii) certain provisions of the Pooling and Servicing
Agreement
Under penalties of perjury, the undersigned declares that the following
is true:
(1) He or she is an officer of _______________ (the "Transferee"),
(2) the Transferee's Employee Identification number is __________,
(3) the Transferee is not a "disqualified organization" (as
defined below), has no plan or intention of becoming a
disqualified organization, and is not acquiring any of its
interest in the Chase Mortgage Finance Corporation,
Multi-Class Mortgage Pass-Through Certificates, Series
2001-S1, Class A-R on behalf of a disqualified organization or
any other entity,
(4) unless Chase Mortgage Finance Corporation ("CMFC") has
consented to the transfer to the Transferee by executing the
form of Consent affixed as Appendix B to the Transferee's
Letter to which this Certificate is affixed as Appendix A, the
Transferee is a "U.S. Person" (as defined below),
(5) that no purpose of the transfer is to avoid or impede the
assessment or collection of tax,
(6) the Transferee has historically paid its debts as they became
due,
(7) the Transferee intends, and believes that it will be able, to
continue to pay its debts as they become due in the future,
(8) the Transferee understands that, as beneficial owner of the
Class A-R Certificate, it may incur tax liabilities in excess
of any cash flows generated by the Class A-R Certificate,
(9) the Transferee intends to pay any taxes associated with
holding the Class A-R Certificate as they become due,
(10) the Transferee consents to any amendment of the Pooling and
Servicing Agreement that shall be deemed necessary by CMFC
(upon advice of counsel) to constitute a reasonable
arrangement to ensure that the Class A-R Certificate will not
be owned directly or indirectly by a disqualified
organization, and
[(11) the present value of the anticipated tax liabilities
associated with holding the Class A-R Certificate does not
exceed the sum of:
(A) the present value of any consideration given to the
Transferee to acquire the Class A-R Certificate;
(B) the present value of the expected future
distributions on the Class A-R Certificate; and
K-3
(C) the present value of the anticipated tax savings
associated with holding the Class A-R Certificate as
the Trust Fund generates losses.
For purposes of this declaration, (i) the Transferee is
assumed to pay tax at a rate equal to the highest rate of tax
specified in Section 11(b)(1) of the Code, and (ii) present
values are computed using a discount rate equal to the
applicable Federal rate prescribed by Section 1274(d) of the
Code or a lower discount rate if the Transferee can
demonstrate that it regularly borrows, in the course of its
trade or business, substantial funds at such lower rate from
unrelated third parties;]
[(11) (A) at the time of the transfer, and at the close of
each of the Transferee's two fiscal years preceding
the year of transfer, the Transferee's gross assets
for financial reporting purposes exceed $100 million
and its net assets for financial reporting purposes
exceed $10 million; and
(B) the Transferee is an eligible corporation as defined
in Section 860L(a)(2) of the Code and has made a
written agreement that any subsequent transfer of the
Class A-R Certificate will be to another eligible
corporation that satisfies Section 4 of Revenue
Procedure 2001-12, and such transfer will not be a
transfer to a foreign branch of an eligible
corporation or any other arrangement by which the
Class A- R Certificate is at any time subject to net
tax by a country other than the United States or by a
possession of the United States.
For purposes of this declaration, (i) the gross assets and net
assets of the Transferee do not include any obligation of any
person related to the Transferee (as defined in Section
860L(g) of the Code) or any other asset if a principal purpose
for holding or acquiring that asset is to permit the
Transferee to make this declaration or to satisfy the
requirements of Section 6 of Revenue Procedure 2001-12;]
[(11) [Intentionally left blank;]
For purpose of this affidavit, the term "disqualified organization" means the
United States, any state or political subdivision thereof, any foreign
government, any international organization, any agency or instrumentality of any
of the foregoing (except any entity treated as other than an instrumentality of
the foregoing for purposes of Section 168(h)(2)(D) of the Internal Revenue Code
of 1986, as amended (the "Code")), any organization (other than a cooperative
described in Section 521 of the Code) that is exempt from taxation under the
Code (unless such organization is subject to tax on excess inclusions) and any
organization that is described in Section 1381(a)(2)(C) of the Code and the term
"U.S. Person" means a citizen or resident of the United States, a corporation or
partnership (unless, in the case of a partnership, Treasury regulations are
adopted that provide otherwise) created or organized in or under the laws of the
United States, any state thereof or the District of Columbia, including an
entity treated as a corporation or partnership for federal income tax purposes,
an estate whose income is subject to Unites States federal income tax regardless
of its source, or a trust if a court within the United States is able to
exercise primary supervision over the administration of such trust, and one or
more such U.S. Persons have the authority to control all substantial decisions
of such trust, (or, to the extent provided in applicable Treasury regulations,
certain trusts in existence on August 20, 1996 which are eligible to elect to be
treated as U.S. Persons).
By: _________________________________________________
_____________________________________________________
Address of Investor for receipt of distribution:
Address of Investor for receipt of tax information:
(Corporate Seal)
Attest:
_____________________________________________________
_____________________________________________________, Secretary
K-4
Personally appeared before me the above-named ______________, known or
proved to me to be the same person who executed the foregoing
instrument and to be the _______ of the Investor, and acknowledged to
me that he executed the same as his free act and deed and the free act
and deed of the Investor.
Subscribed and sworn before me this ____ day of _______________, 200_.
____________________________________
Notary Public
County of _________________________
State of __________________________
My commission expires the ____ day of ___________________________
By: ________________________
Name: ______________________
Title: _____________________
Dated: _____________________________
K-5
APPENDIX B
CONSENT
____________________________________________ (Transferee)
____________________________________________
____________________________________________
Ladies and Gentlemen:
Chase Mortgage Finance Corporation ("CMFC") hereby consents to
the transfer to, and registration in the name of, the Transferee (or, if
applicable, registration in the name of such Transferee's nominee of the
Multi-Class Mortgage Pass-Through Certificates, Series 2001-S1, Class A-R
described in the Transferee's Letter to which this Consent is appended,
notwithstanding CMFC's knowledge that the Transferee is not a U.S. Person (as
defined in such Transferee's Letter).
CHASE MORTGAGE FINANCE
CORPORATION
Dated: _____________________________ By: __________________
K-6
EXHIBIT L
REQUEST FOR RELEASE OF DOCUMENTS
To: Citibank, N.A.
000 Xxxx Xxxxxx
5th Floor, Zone 1
Xxx Xxxx, XX 00000 Citibank, N.A.
Re:
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
_______ 5. Nonliquidation Reason: __________________________
By: ______________________
(authorized signer)
Issuer: __________________
Address: _________________
__________________________
Date: ____________________
Trustee
-------
Citibank, N.A.
Please acknowledge the execution of the above request by your signature and date
below:
___________________________________ ____________________________________
Signature Date
Documents returned to Trustee:
___________________________________ ____________________________________
Trustee Date
L-1
EXHIBIT M
TRANSFEREE ERISA REPRESENTATION LETTER
[DATE]
Chase Mortgage Finance Corporation
000 Xxxx Xxxxxxxxx
Xxxxx Xxxxx
Xxxxxxxxx Xxxx, XX 00000
Re: Chase Mortgage Finance Corporation,
Multi-Class Mortgage Pass-Through
Certificates, Series 2001-S1, [Class M] [Class B- ]
---------------------------------------------------
Ladies and Gentlemen:
______________ (the "Purchaser") intends to purchase from
_________________________ (the "Transferor") $_______ by original principal
balance (the "Transferred Certificate") of Multi-Class Mortgage Pass-Through
Certificates, Series 2001-S1, [Class M] [Class B-__] (the "Certificates"),
issued pursuant to a pooling and servicing agreement, dated as of January 1,
2001 (the "Pooling and Servicing Agreement"), among Chase Mortgage Finance
Corporation (the "Depositor"), Chase Manhattan Mortgage Corporation, as Servicer
(the "Servicer"), and Citibank, N.A., as trustee (the "Trustee"). [The Purchaser
intends to register the Transferred Certificate in the name of
____________________, as nominee for __________________.] All terms used and not
otherwise defined herein shall have the meanings set forth in the Pooling and
Servicing Agreement.
For good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, we hereby certify, represent and
warrant to, and covenant with, the Depositor that:
(a) we are not an employee benefit plan subject to Section 406
of the Employee Retirement Income Security Act of 1974, as amended
("ERISA") or Section 4975 of the Internal Revenue Code of 1986, as
amended (the "Code") or any materially similar provisions of applicable
federal, state or local law, nor a person acting on behalf of any such
plan or using the assets of such plan, or, alternatively, in the case
of an insurance company, the assets of any separate accounts to effect
such acquisition, or alternatively, (b) the source of funds for the
purchase of such Transferred Certificate is an "insurance company
general account" within the meaning of Prohibited Transaction Class
Exemption 95-60 ("PTCE 95-60"), 60 Fed. Reg. 35925 (July 12, 1995), and
the acquisition and holding of such Transferred Certificate is exempt
under PTCE 95-60.
We agree to indemnify the Trustee, the Servicer and the Depositor
against any liability that may result from any misrepresentation made herein.
Very truly yours,
[PURCHASER]
By: _____________________
Name: ___________________
Title: __________________
M-1
