EXECUTION COPY
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XXXXXX XXXXXXX XXXX XXXXXX CAPITAL I INC.,
Depositor,
OCWEN FEDERAL BANK FSB,
Servicer,
THE PROVIDENT BANK,
Servicer,
and
U.S. BANK NATIONAL ASSOCIATION,
Trustee
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POOLING AND SERVICING AGREEMENT
Dated as of June 1, 2002
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XXXXXX XXXXXXX XXXX XXXXXX CAPITAL I INC. TRUST 2002-HE1
MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 2002-HE1
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TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
REPRESENTATIONS AND WARRANTIES
Section 2.01 Conveyance of Mortgage Loans..............................
Section 2.02 Acceptance by the Trustee of the Mortgage Loans...........
Section 2.03 Remedies for Breaches of Representations and Warranties
with Respect to the Mortgage Loans......................
Section 2.04 The Depositor and the Mortgage Loans......................
Section 2.05 [Reserved.]...............................................
Section 2.06 Execution and Delivery of Certificates....................
Section 2.07 REMIC Matters.............................................
Section 2.08 Representations and Warranties of the Depositor...........
ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
Section 3.01 Servicers to Service Mortgage Loans.......................
Section 3.02 Subservicing Agreements between a Servicer and
Subservicers............................................
Section 3.03 Successor Subservicers....................................
Section 3.04 Liability of the Servicers................................
Section 3.05 No Contractual Relationship between Subservicers
and the Trustee.........................................
Section 3.06 Assumption or Termination of Subservicing Agreements
by Trustee..............................................
Section 3.07 Collection of Certain Mortgage Loan Payments..............
Section 3.08 Subservicing Accounts.....................................
Section 3.09 Collection of Taxes, Assessments and Similar Items;
Escrow Accounts.........................................
Section 3.10 Collection Accounts.......................................
Section 3.11 Withdrawals from the Collection Accounts..................
Section 3.12 Investment of Funds in the Accounts.......................
Section 3.13 Maintenance of Hazard Insurance and Errors and
Omissions and Fidelity Coverage.........................
Section 3.14 Enforcement of Due-On-Sale Clauses Assumption Agreements..
Section 3.15 Realization upon Defaulted Mortgage Loans.................
Section 3.16 Release of Mortgage Files.................................
Section 3.17 Title, Conservation and Disposition of REO Property.......
Section 3.18 Notification of Adjustments...............................
Section 3.19 Access to Certain Documentation and Information
Regarding the Mortgage Loans............................
Section 3.20 Documents, Records and Funds in Possession of
the Servicers to Be Held for the Trustee................
Section 3.21 Servicing Compensation....................................
Section 3.22 Annual Statement as to Compliance.........................
Section 3.23 Annual Independent Public Accountants'
Servicing Statement; Financial Statements...............
Section 3.24 Trustee to Act as Servicer................................
Section 3.25 Compensating Interest.....................................
Section 3.26 Credit Reporting; Xxxxx-Xxxxx-Xxxxxx Act..................
ARTICLE IV
DISTRIBUTIONS AND
ADVANCES BY THE SERVICERS
Section 4.01 Advances..................................................
Section 4.02 Priorities of Distribution................................
Section 4.03 Monthly Statements to Certificateholders..................
Section 4.04 Certain Matters Relating to the Determination of LIBOR....
ARTICLE V
THE CERTIFICATES
Section 5.01 The Certificates..........................................
Section 5.02 Certificate Register; Registration of Transfer
and Exchange of Certificates............................
Section 5.03 Mutilated, Destroyed, Lost or Stolen Certificates.........
Section 5.04 Persons Deemed Owners.....................................
Section 5.05 Access to List of Certificateholders' Names
and Addresses...........................................
Section 5.06 Maintenance of Office or Agency...........................
ARTICLE VI
THE DEPOSITOR AND THE SERVICERS
Section 6.01 Respective Liabilities of the Depositor
and the Servicers.......................................
Section 6.02 Merger or Consolidation of the Depositor or a Servicer....
Section 6.03 Limitation on Liability of the Depositor,
the Servicers and Others................................
Section 6.04 Limitation on Resignation of a Servicer...................
Section 6.05 Additional Indemnification by the Servicers;
Third Party Claims......................................
ARTICLE VII
DEFAULT
Section 7.01 Events of Default.........................................
Section 7.02 Trustee to Act; Appointment of Successor..................
Section 7.03 Notification to Certificateholders........................
ARTICLE VIII
CONCERNING THE TRUSTEE
Section 8.01 Duties of the Trustee.....................................
Section 8.02 Certain Matters Affecting the Trustee.....................
Section 8.03 Trustee Not Liable for Certificates or Mortgage Loans.....
Section 8.04 Trustee May Own Certificates..............................
Section 8.05 Trustee's Fees and Expenses; Custodial Fees...............
Section 8.06 Eligibility Requirements for the Trustee..................
Section 8.07 Resignation and Removal of the Trustee....................
Section 8.08 Successor Trustee.........................................
Section 8.09 Merger or Consolidation of the Trustee....................
Section 8.10 Appointment of Co-Trustee or Separate Trustee.............
Section 8.11 Tax Matters...............................................
Section 8.12 Periodic Filings..........................................
Section 8.13 Tax Classification of the Excess Reserve Fund Account.....
Section 8.14 Appointment of Custodian..................................
ARTICLE IX
TERMINATION
Section 9.01 Termination upon Liquidation or Purchase
of the Mortgage Loans...................................
Section 9.02 Final Distribution on the Certificates....................
Section 9.03 Additional Termination Requirements.......................
ARTICLE X
MISCELLANEOUS PROVISIONS
Section 10.01 Amendment................................................
Section 10.02 Recordation of Agreement; Counterparts...................
Section 10.03 Governing Law............................................
Section 10.04 Intention of Parties.....................................
Section 10.05 Notices..................................................
Section 10.06 Severability of Provisions...............................
Section 10.07 Assignment; Sales; Advance Facilities....................
Section 10.08 Limitation on Rights of Certificateholders...............
Section 10.09 Inspection and Audit Rights..............................
Section 10.10 Certificates Nonassessable and Fully Paid................
Section 10.11 Waiver of Jury Trial.....................................
Section 10.12 Limitation of Damages....................................
SCHEDULES
Schedule I Mortgage Loan Schedule
Schedule II Representations and Warranties of Ocwen Federal Bank FSB
as Servicer
Schedule III Representations and Warranties of The Provident Bank as Servicer
EXHIBITS
Exhibit A Form of Class A, Class M, Class B Certificate
Exhibit B Form of Class P Certificate
Exhibit C Form of Class R Certificate
Exhibit D Form of Class X Certificate
Exhibit E Form of Initial Certification of Trustee
Exhibit F Form of Final Certification of Trustee
Exhibit G Form of Transfer Affidavit
Exhibit H Form of Transferor Certificate
Exhibit I Form of Rule 144A Letter
Exhibit J Form of Request for Release
Exhibit K Form of Contents for Each Mortgage File
Exhibit L Form of Subsequent Transfer Agreement
THIS POOLING AND SERVICING AGREEMENT, dated as of June 1, 2002,
among XXXXXX XXXXXXX XXXX XXXXXX CAPITAL I INC., a Delaware corporation, as
depositor (the "Depositor"), OCWEN FEDERAL BANK FSB, a federally chartered
savings bank, as servicer ("Ocwen"), THE PROVIDENT BANK, an Ohio corporation, as
servicer ("Provident" and, together with "Ocwen," the "Servicers"), and U.S.
BANK NATIONAL ASSOCIATION, a national banking association, as trustee (the
"Trustee"),
W I T N E S S E T H:
- - - - - - - - - -
In consideration of the mutual agreements herein contained, the
parties hereto agree as follows:
PRELIMINARY STATEMENT
The Trustee shall elect that two segregated asset pools within the
Trust Fund be treated for federal income tax purposes as comprising two REMICs
(each, a "REMIC" or, in the alternative, the Lower Tier REMIC and the Upper Tier
REMIC, respectively). Each Certificate, other than the Class P and Class R
Certificates, represents ownership of a regular interest in the Upper Tier REMIC
for purposes of the REMIC Provisions. The Class R Certificate represents
ownership of the sole class of residual interest in each of the Lower Tier REMIC
and the Upper Tier REMIC for purposes of the REMIC Provisions. The Startup Day
for each REMIC described herein is the Closing Date. The latest possible
maturity date for each Certificate is the latest date referenced in Section
9.01. The Upper Tier REMIC shall hold as assets the several classes of
uncertificated Lower Tier Regular Interests, set out below. Each such Lower Tier
Regular Interest is hereby designated as a regular interest in the Lower Tier
REMIC. Class LT-A1, Class LT-A2, Class LT-M-1, Class LT-M-2, Class LT-B-1 and
Class LT-B-2 are hereby designated the LT Accretion Directed Classes. The Class
P Certificate represents beneficial ownership of the Prepayment Charges, which
portion of the Trust Fund shall be treated as a grantor trust.
CORRESPONDING
LOWER TIER LOWER TIER INITIAL LOWER TIER UPPER TIER
CLASS DESIGNATION INTEREST RATE PRINCIPAL AMOUNT REMIC CLASS
----------------- ------------- ---------------- -----------
Class LT-A-1 (1) 1/2 initial Corresponding A-1
Upper Tier REMIC initial
principal balance
Class LT-A-2 (1) 1/2 initial Corresponding A-2
Upper Tier REMIC initial
principal balance
Class LT-M-1 (1) 1/2 initial Corresponding M-1
Upper Tier REMIC initial
principal balance
Class LT-M-2 (1) 1/2 initial Corresponding M-2
Upper Tier REMIC initial
principal balance
Class LT-B-1 (1) 1/2 initial Corresponding B-1
Upper Tier REMIC initial
principal balance
Class LT-B-2 (1) 1/2 initial Corresponding B-2
Upper Tier REMIC initial
principal balance
Class LT-Accrual (1) 1/2 Current Maximum Amount
plus 1/2 Subordinated Amount
Class LT-R (2) (2)
(1) The interest rate with respect to any Distribution Date for these interests
is a per annum variable rate equal to the WAC Cap.
(2) The Class LT-R Interest is the sole class of residual interest in the Lower
Tier REMIC and it does not have a principal amount or an interest rate.
The Lower Tier REMIC shall hold as assets all of the assets included
in the Trust Fund other than Prepayment Charges, the Excess Reserve Fund
Account, and the Lower Tier Regular Interests.
On each Distribution Date, 50% of the increase in the Subordinated
Amount will be payable as a reduction of the principal balances of the LT
Accretion Directed Classes (each such Class will be reduced by an amount equal
to 50% of any increase in the Subordinated Amount that is attributable to a
reduction in the principal balance of its Corresponding Class) and will be
accrued and added to the principal balance of the LT Accrual Class. On each
Distribution Date, the increase in the principal balance of the LT Accrual Class
may not exceed interest accruals for such Distribution Date for the LT Accrual
Class. In the event that: (i) 50% of the increase in the Subordinated Amount
exceeds (ii) interest accruals on the LT Accrual Class for such Distribution
Date, the excess for such Distribution Date (accumulated with all such excesses
for all prior Distribution Dates) will be added to any increase in the
Subordinated Amount for purposes of determining the amount of interest accrual
on the LT Accrual Class payable as principal on the LT Accretion Directed
Classes on the next Distribution Date pursuant to the first sentence of this
paragraph. All payments of scheduled principal and prepayments of principal
generated by the Mortgage Loans shall be allocated 50% to the LT Accrual Class,
and 50% to the LT Accretion Directed Classes (principal payments shall be
allocated among such LT Accretion Directed Classes in an amount equal to 50% of
the principal amounts allocated to their respective Corresponding Classes),
until paid in full. Notwithstanding the above, principal payments allocated to
the Class X Certificates that result in the reduction in the Subordinated Amount
shall be allocated to the LT Accrual Class (until paid in full). Realized losses
shall be applied so that after all distributions have been made on each
Distribution Date (i) the principal balances of each of the LT Accretion
Directed Class is equal to 50% of the principal balance of their Corresponding
Class, and (ii) the LT Accrual Class is equal to 50% of the Current Maximum
Amount plus 50% of the Subordinated Amount.
The Upper Tier REMIC shall issue the following classes of interests
and each Upper Tier Regular Interest, other than the Class UT-R Interest, is
hereby designated as a regular interest in the Upper Tier REMIC.
UPPER TIER UPPER TIER INITIAL UPPER TIER CORRESPONDING
CLASS DESIGNATION INTEREST RATE PRINCIPAL AMOUNT CERTIFICATE
----------------- ------------- ------------------ -------------
Class A-1 (1) $557,163,000 Class A-1(6)
Class A-2 (2) $237,977,000 Class A-2(6)
Class M-1 (3) $52,690,000 Class M-1(6)
Class M-2 (3) $47,900,000 Class M-2(6)
Class B-1 (3) $38,320,000 Class B-1(6)
Class B-2 (3) $11,975,000 Class B-2(6)
Class X (4) (4) Class X(4)
Class UT-R (5) Class R
(1) The Class A-1 Interests will bear interest during their initial Interest
Accrual Period at 2.205% per annum. The Class A-1 Interests will bear
interest during each Interest Accrual Period thereafter at a per annum rate
equal to (a) on or prior to the Optional Termination Date, the least of (i)
LIBOR plus 0.365%, (ii) the Loan Group I Cap and (iii) the WAC Cap or (b)
after the Optional Termination Date, the least of (i) LIBOR plus 0.730%,
(ii) the Loan Group I Cap and (iii) the WAC Cap.
(2) The Class A-2 Interests will bear interest during their initial Interest
Accrual Period at 2.17% per annum. The Class A-2 Interests will bear
interest during each Interest Accrual Period thereafter at a per annum rate
equal to (a) on or prior to the Optional Termination Date, the least of (i)
LIBOR plus 0.330%, (ii) the Loan Group II Cap and (iii) the WAC Cap or (b)
after the Optional Termination Date, the least of (i) LIBOR plus 0.660%,
(ii) the Loan Group II Cap and (iii) the WAC Cap.
(3) The Class M-1, Class M-2 , Class B-1 and Class B-2 Interests will bear
interest during their initial Interest Accrual Period at 2.44%, 3.14%,
3.64% and 4.34%, respectively, per annum. The Class M-1, Class M-2, Class
B-1 and Class B-2 Interests will bear interest during each Interest Accrual
Period thereafter at a per annum rate equal to (a) on or prior to the
Optional Termination Date, the least of (i) LIBOR plus 0.600%, 1.300%,
1.800% and 2.500%, respectively, and (ii) the WAC Cap or (b) after the
Optional Termination Date, the least of (i) LIBOR plus 0.900%, 1.950%,
2.700% and 3.750%, respectively, and (ii) the WAC Cap.
(4) The Class X Interest has an initial principal balance of $11,975,000, but
it will not accrue interest on such balance but will accrue interest on a
notional principal balance. As of any Distribution Date, the Class X
Interest shall have a notional principal balance equal to the aggregate of
the principal balances of the Lower Tier Regular Interests as of the first
day of the related Interest Accrual Period. With respect to any Interest
Accrual Period, the Class X Interest shall bear interest at a rate equal to
the excess, if any, of the WAC Cap over the product of (i) 2 and (ii) the
weighted average Pass-Through Rate of the Lower Tier REMIC Interests, where
the LT Accrual Class is subject to a cap equal to zero and each LT
Accretion Directed Class is subject to a cap equal to the Pass-Through Rate
on its Corresponding Class. With respect to any Distribution Date, interest
that so accrues on the notional principal balance of the Class X Interest
shall be deferred in an amount equal to any increase in the Subordinated
Amount on such Distribution Date. Such deferred interest shall not itself
bear interest. The Class X Interest will represent not only ownership of
the Corresponding Class of Upper Tier Regular Interest but also the
obligation to make payments from the Excess Reserve Fund Account in respect
of Basis Risk CarryForward Amounts. For federal income tax purposes, the
Trustee will treat a Class X Certificateholder's obligation to make
payments from the Excess Reserve Fund Account as payments made pursuant to
an interest rate cap contract written by the Class X Certificateholders.
(5) The Class UT-R Interest is the sole class of residual interest in the Upper
Tier REMIC. The Class UT-R Interest does not have an interest rate.
(6) Each of these Certificates will represent not only the ownership of the
Corresponding Class of Upper Tier Regular Interest but also the right to
receive payments from the Excess Reserve Fund Account in respect of any
Basis Risk CarryForward Amounts. For federal income tax purposes, the
Trustee will treat a Certificateholder's right to receive payments from the
Excess Reserve Fund Account as payments made pursuant to an interest rate
cap contract written by the Class X Certificateholders.
The minimum denomination for each Class of Certificates, other than
the Class P, Class R and the Class X Certificates, will be $25,000. The Class P,
Class R and the Class X Certificates will each represent a 100% Percentage
Interest in such class.
Set forth below are designations of Classes of Certificates to the
categories used herein:
Book-Entry Certificates...... All Classes of Certificates other than the
Physical Certificates.
Class A Certificates......... Class A-1 and Class A-2 Certificates.
Subordinated Certificates.... Class M-1, Class M-2, Class B-1 and Class B-2
Certificates.
Delay Certificates........... None.
ERISA-Restricted
Certificates............... Class R Certificates, Class P Certificate and
Class X Certificate; any certificate with a rating
below the lowest applicable permitted rating under
the Underwriters' Exemption.
Floating Rate Certificates... Class A and Subordinated Certificates.
LIBOR Certificates........... Class A and Subordinated Certificates.
Non-Delay Certificates....... Class A, Class X and Subordinated Certificates.
Offered Certificates......... All Classes of Certificates other than the Private
Certificates.
Physical Certificates........ Class P, Class X and Class R Certificates.
Private Certificates......... Class A-1, Class P, Class X and Class R
Certificates.
Rating Agencies.............. Xxxxx'x, Fitch and Standard & Poor's.
Regular Certificates......... All Classes of Certificates other than the Class P
and Class R Certificates.
Residual Certificates........ Class R Certificates.
ARTICLE I
DEFINITIONS
Whenever used in this Agreement, the following words and phrases,
unless the context otherwise requires, shall have the following meanings:
60+ Day Delinquent Loan: Each Mortgage Loan with respect to which
any portion of a Scheduled Payment is, as of the last day of the prior Due
Period, two months or more past due (without giving effect to any grace period),
each Mortgage Loan in foreclosure, all REO Property and each Mortgage Loan for
which the Mortgagor has filed for bankruptcy.
Accepted Servicing Practices: With respect to any Mortgage Loan,
those mortgage servicing practices set forth in Section 3.01 of this Agreement.
Account: Any of the Capitalized Interest Account, the Collection
Accounts, the Distribution Account, any Escrow Account, the Excess Reserve Fund
Account, or the Pre-Funding Accounts. Each Account shall be an Eligible Account.
Accredited: Accredited Home Lenders, Inc., a California corporation,
and its successors and assigns, in its capacity as an Originator hereunder.
Accredited Assignment Agreement: The Assignment and Recognition
Agreement, dated June 27, 2002, by and among the Depositor, the Purchaser and
Accredited, and each other Assignment and Recognition Agreement by and among the
Depositor, the Purchaser and Accredited in connection with any Subsequent
Transfer of Accredited Mortgage Loans.
Accredited Mortgage Loans: The Mortgage Loans identified as being
originated by Accredited on the Mortgage Loan Schedule.
Accredited Purchase Agreement: The Mortgage Loan Purchase and
Warranties Agreement, dated as of May 1, 2002, by and between the Purchaser and
Accredited, as assigned by the Purchaser to the Depositor, solely insofar as the
Accredited Purchase Agreement relates to the Accredited Mortgage Loans, pursuant
to the Accredited Assignment Agreement.
Accrued Certificate Interest Distribution Amount: With respect to
any Distribution Date for each Class of Certificates (other than the Class X
Certificate), the amount of interest accrued during the related Interest Accrual
Period at the applicable Pass-Through Rate on the related Class Certificate
Balance immediately prior to such Distribution Date, as reduced by such Class's
share of Net Prepayment Interest Shortfalls and Relief Act Interest Shortfalls
for the related Due Period allocated to such Class pursuant to Section 4.02.
Addition Notice: A written notice from the Depositor to the Trustee
that the Depositor desires to make a Subsequent Transfer.
Adjustable Rate Mortgage Loan: An adjustable rate Mortgage Loan
purchased pursuant to a Purchase Agreement.
Adjusted Net Mortgage Rate: As to each Mortgage Loan and at any
time, the per annum rate equal to the Mortgage Rate less the Expense Fee Rate.
Adjustment Date: As to any Mortgage Loan, the first Due Date on
which the related Mortgage Rate adjusts as set forth in the related Mortgage
Note and each Due Date thereafter on which the Mortgage Rate adjusts as set
forth in the related Mortgage Note.
Advance: Any P&I Advance or Servicing Advance.
Advance Facility: A financing or other facility as described in
Section 10.07.
Advancing Person: The Person to whom either Servicer's rights under
this Agreement to be reimbursed for any Monthly Advances or Servicing Advances
have been assigned pursuant to Section 10.07.
Affiliate: With respect to any Person, any other Person controlling,
controlled by or under common control with such first Person. For the purposes
of this definition, "control" means the power to direct the management and
policies of such Person, directly or indirectly, whether through the ownership
of voting securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
Agreement: This Pooling and Servicing Agreement and all amendments
or supplements hereto.
Amount Held for Future Distribution: As to the Certificates on any
Distribution Date, the aggregate amount held in the Collection Accounts at the
close of business on the related Remittance Date on account of (i) Principal
Prepayments and Liquidation Proceeds on the Mortgage Loans received after the
end of the related Prepayment Period and (ii) all Scheduled Payments on the
Mortgage Loans due after the end of the related Due Period.
Applied Realized Loss Amount: With respect to any Distribution Date,
the amount, if any, by which the aggregate Class Certificate Balance of the
Regular Certificates after distributions of principal on such Distribution Date
exceeds the aggregate Stated Principal Balance of the Mortgage Loans for such
Distribution Date.
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.
Assignment Agreements: Each of the Accredited Assignment Agreement,
the First Franklin Assignment Agreement and/or the New Century Assignment
Agreement.
Assignment of Mortgage: An assignment of the Mortgage, notice of
transfer or equivalent instrument in recordable form, (other than the assignee's
name and recording information not yet returned from the recording office),
reflecting the sale of the Mortgage to the Trustee.
Available Funds: With respect to any Distribution Date and the
Mortgage Loans to the extent received by the Trustee (x) the sum of (i) all
scheduled installments of interest (net of the related Expense Fees) and
principal due on the Due Date on such Mortgage Loans in the related Due Period
and received prior to the related Remittance Date, together with any P&I
Advances in respect thereof; (ii) all Condemnation Proceeds, Insurance Proceeds
and Liquidation Proceeds during the related Prepayment Period (in each case, net
of unreimbursed expenses incurred in connection with a liquidation or
foreclosure and unreimbursed Advances, if any); (iii) all partial or full
prepayments on the Mortgage Loans received during the related Prepayment Period
together with all Compensating Interest thereon; (iv) amounts received with
respect to such Distribution Date as the Repurchase Price in respect of a
Mortgage Loan repurchased by the applicable Originator, as of such Distribution
Date; (v) for any Distribution Date on or prior to August 26, 2002, the funds
withdrawn from the Capitalized Interest Account and deposited into the
Distribution Account on such Distribution Date pursuant to Section 4.02 hereof;
and (vi) the Closing Date Deposit Amount; reduced by (y) amounts in
reimbursement for Advances previously made with respect to the Mortgage Loans
and other amounts as to which the Servicers or the Trustee are entitled to be
reimbursed pursuant to the Agreement.
Balloon Loan: Any Mortgage Loan that provided on the date of
origination for an amortization schedule extending beyond its stated maturity
date.
Basic Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the Principal Remittance Amount for such
Distribution Date over (ii) the Excess Subordinated Amount, if any, for such
Distribution Date.
Basis Risk CarryForward Amount: With respect to each Class of
Regular Certificates, as of any Distribution Date, the sum of (A) if on such
Distribution Date the Pass-Through Rate for any Class of Regular Certificates is
based upon a Loan Group Cap or the WAC Cap, the excess of (i) the amount of
interest such Class of Certificates would otherwise be entitled to receive on
such Distribution Date had such rate been calculated as the sum of LIBOR and the
applicable Pass-Through Margin on such Class of Certificates for such
Distribution Date, over (ii) the amount of interest payable on such Class of
Certificates at, with respect to the Class A-1 Certificates, the lesser of (x)
the Loan Group I Cap or (z) the WAC Cap, with respect to the Class A-2
Certificates, the lesser of (x) the Loan Group II Cap or (z) the WAC Cap, and
with respect to each other Class of Regular Certificates, the WAC Cap, as
applicable, for such Distribution Date and (B) the Basis Risk CarryForward
Amount for such Class of Certificates for all previous Distribution Dates not
previously paid, together with interest thereon at a rate equal to the sum of
LIBOR and the applicable Pass-Through Margin for such Class of Certificates for
such Distribution Date.
Basis Risk Payment: For any Distribution Date, an amount equal to
any Basis Risk CarryForward Amount; provided, however, that with respect to any
Distribution Date, the payment cannot exceed the sum of the amounts otherwise
distributable on the Class X Certificates.
Best's: Best's Key Rating Guide, as the same shall be amended from
time to time.
Book-Entry Certificates: As specified in the Preliminary Statement.
Business Day: Any day other than (i) Saturday or Sunday, or (ii) a
day on which banking and savings and loan institutions, in (a) the State of New
York, (b) a state in which a Servicer's servicing operations are located, or (c)
the State in which the Trustee's operations are located, are authorized or
obligated by law or executive order to be closed.
Capitalized Interest Account: The separate Eligible Account created
and maintained by the Trustee pursuant to Section 3.07(e) in the name of the
Trustee for the benefit of the Certificateholders and designated "U.S. Bank
National Association, in trust for registered holders of Xxxxxx Xxxxxxx Xxxx
Xxxxxx Capital I Inc. Trust 2002-HE1, Mortgage Pass-Through Certificates, Series
2002-HE1."
Capitalized Interest Requirement: With respect to the Distribution
Dates occurring in July 2002 and August 2002, the sum of (i) an amount equal to
the product of (a) the aggregate of the Group I Pre-Funded Amounts as of the
first day of the related Interest Accrual Period and (b) 1/12th of the Loan
Group I Cap for such Distribution Date, and (ii) an amount equal to the product
of (a) the aggregate of the Group II Pre-Funded Amounts as of the first day of
the related Interest Accrual Period and (b) 1/12th of the Loan Group II Cap for
such Distribution Date, less the Pre-Funding Earnings available for deposit to
the Distribution Account on such Distribution Date. In no event will the
Capitalized Interest Requirement be less than zero.
Certificate: Any one of the Certificates executed by the Trustee in
substantially the forms attached hereto as exhibits.
Certificate Balance: With respect to any Class of Certificates,
other than the Class P or Class R Certificates, at any date, the maximum dollar
amount of principal to which the Holder thereof is then entitled hereunder, such
amount being equal to the Denomination thereof minus all distributions of
principal previously made with respect thereto and in the case of any
Subordinated Certificates, reduced by any Applied Realized Loss Amounts
applicable to such Class of Subordinated Certificates. The Class P and Class R
Certificates have no Certificate Balance.
Certificate Owner: With respect to a Book-Entry Certificate, the
Person who is the beneficial owner of such Book-Entry Certificate.
Certificate Register: The register maintained pursuant to Section
5.02.
Certificateholder or Holder: The person in whose name a Certificate
is registered in the Certificate Register, except that, solely for the purpose
of giving any consent pursuant to this Agreement, any Certificate registered in
the name of the Depositor or any affiliate of the Depositor shall be deemed not
to be Outstanding and the Percentage Interest evidenced thereby shall not be
taken into account in determining whether the requisite amount of Percentage
Interests necessary to effect such consent has been obtained; provided, however,
that if any such Person (including the Depositor) owns 100% of the Percentage
Interests evidenced by a Class of Certificates, such Certificates shall be
deemed to be Outstanding for purposes of any provision hereof that requires the
consent of the Holders of Certificates of a particular Class as a condition to
the taking of any action hereunder. The Trustee is entitled to rely conclusively
on a certification of the Depositor or any affiliate of the Depositor in
determining which Certificates are registered in the name of an affiliate of the
Depositor.
Class: All Certificates bearing the same class designation as set
forth in the Preliminary Statement.
Class A Certificates: The Class A-1 and Class A-2 Certificates.
Class A Principal Allocation Percentage: For any Distribution Date
is the percentage equivalent of a fraction, determined as follows: (A) with
respect to the Class A-1 Certificates, the numerator of which is (x) the portion
of the Principal Remittance Amount for that Distribution Date that is
attributable to the principal received or advanced on the Group I Mortgage Loans
and the denominator of which is (y) the Principal Remittance Amount for that
Distribution Date; and (B) with respect to the Class A-2 Certificates, the
numerator of which is (x) the portion of the Principal Remittance Amount for
that Distribution Date that is attributable to the principal received or
advanced on the Group II Mortgage Loans and the denominator of which is (y) the
Principal Remittance Amount for that Distribution Date.
Class A Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the aggregate Class Certificate Balances of
the Class A Certificates immediately prior to such Distribution Date over (ii)
the lesser of (A) 66.00% of the Current Maximum Amount for such Distribution
Date and (B) the Current Maximum Amount for such Distribution Date minus
$4,790,000.
Class A-1 Certificates: All Certificates bearing the class
designation of "Class A-1 Certificates."
Class A-2 Certificates: All Certificates bearing the class
designation of "Class A-2 Certificates."
Class B Certificates: All Certificates bearing the class designation
of "Class B Certificates."
Class B-1 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class
Certificate Balances of the Class A Certificates (after taking into account the
distribution of the Class A Principal Distribution Amount on such Distribution
Date), (B) the Class Certificate Balance of the Class M-1 Certificates (after
taking into account distribution of the Class M-1 Principal Distribution Amount
on such Distribution Date), (C) the Class Certificate Balance of the Class M-2
Certificates (after taking into account distribution of the Class M-2 Principal
Distribution Amount for such Distribution Date), and (D) the Class Certificate
Balance of the Class B-1 Certificates immediately prior to such Distribution
Date over (ii) the lesser of (A) 95.00% of the Current Maximum Amount for such
Distribution Date and (B) the Current Maximum Amount for such Distribution Date
minus $4,790,000.
Class B-2 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class
Certificate Balances of the Class A Certificates (after taking into account the
distribution of the Class A Principal Distribution Amount on such Distribution
Date), (B) the Class Certificate Balance of the Class M-1 Certificates (after
taking into account the distribution of the Class M-1 Principal Distribution
Amount on such Distribution Date), (C) the Class Certificate Balance of the
Class M-2 Certificates (after taking into account the distribution of the Class
M-2 Principal Distribution Amount on such Distribution Date), (D) the Class
Certificate Principal Balance of the Class B-1 Certificates (after taking into
the account the distribution of the Class B-1 Principal Distribution Amount on
such Distribution Date) and (E) the Class Certificate Balance of the Class B-2
Certificates immediately prior to such Distribution Date over (ii) the lesser of
(A) approximately 97.50% of the Current Maximum Amount for such Distribution
Date and (B) the Current Maximum Amount for such Distribution Date minus
$4,790,000; provided, however, that, with respect to any Distribution Date on
which the Class Certificate Balances of the Class A-1, Class M-1, Class M-2 and
Class B-1 Certificates have been reduced to zero, the Class B-2 Principal
Distribution Amount will be the lesser of (x) the Class Certificate Balance of
the Class B-2 Certificates and (y) the Principal Distribution Amount.
Class Certificate Balance: With respect to any Class and as to any
date of determination, the aggregate of the Certificate Balances of all
Certificates of such Class as of such date.
Class M-1 Certificates: All Certificates bearing the class
designation of "Class M-1 Certificates."
Class M-2 Certificates: All Certificates bearing the class
designation of "Class M-2 Certificates."
Class M-1 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class
Certificate Balances of the Class A Certificates (after taking into account
distribution of the Class A Principal Distribution Amount on such Distribution
Date), and (B) the Class Certificate Balance of the Class M-1 Certificates
immediately prior to such Distribution Date over (ii) the lesser of (A) 77.00%
of the Current Maximum Amount for such Distribution Date and (B) the Current
Maximum Amount for such Distribution Date minus $4,790,000.
Class M-2 Principal Distribution Amount: With respect to any
Distribution Date, the excess of (i) the sum of (A) the aggregate Class
Certificate Balances of the Class A Certificates (after taking into account
distribution of the Class A Principal Distribution Amount on such Distribution
Date), (B) the Class Certificate Balance of the Class M-1 Certificates (after
taking into account distribution of the Class M-1 Principal Distribution Amount
on such Distribution Date) and (C) the Class Certificate Balance of the Class
M-2 Certificates immediately prior to such Distribution Date over (ii) the
lesser of (A) 87.00% of the Current Maximum Amount for such Distribution Date
and (B) the Current Maximum Amount for such Distribution Date minus $4,790,000.
Class P Certificates: All Certificates bearing the designation of
"Class P Certificates."
Class R Certificates: All Certificates bearing the designation of
"Class R Certificates."
Class X Certificates: All Certificates bearing the designation of
"Class X Certificates."
Class X Distributable Amount: On any Distribution Date, the sum of
(i) the amount of interest that has accrued on the Class X Interest and not
applied as an Extra Principal Distribution Amount on such Distribution Date,
plus any such accrued interest remaining undistributed from prior Distribution
Dates, and (ii) any portion of the principal balance of the Class X Interest
which is distributable as a Subordination Reduction Amount, less any amounts
paid as a Basis Risk Payment.
Class X Interest: As specified in the Preliminary Statement.
Closing Date Deposit Amount: $257,180.14 deposited by the Depositor
into the Distribution Account on the Closing Date.
Closing Date: June 27, 2002.
Code: The Internal Revenue Code of 1986, including any successor or
amendatory provisions.
Collection Account: As defined in Section 3.10(a).
Compensating Interest: For any Distribution Date, the lesser of (a)
the Prepayment Interest Shortfall, if any, for the Distribution Date, with
respect to voluntary Principal Prepayments in full by the mortgagor (excluding
any payments made upon liquidation of the Mortgage Loan) and (b) the amount of
the Servicing Fee payable to the applicable Servicer for such Distribution Date.
Condemnation Proceeds: All awards of settlements in respect of a
Mortgaged Property, whether permanent or temporary, partial or entire, by
exercise of the power of eminent domain or condemnation.
Corporate Trust Office: The designated office of the Trustee in the
State of Minnesota at which at any particular time its corporate trust business
with respect to this Agreement is administered, which office at the date of the
execution of this Agreement is located at 000 Xxxx Xxxxx Xxxxxx, Xx. Xxxx,
Xxxxxxxxx 00000, Attn: Structured Finance/MSDW 2002-HE1, facsimile no. (651)
244-1797 and which is the address to which notices to and correspondence with
the Trustee should be directed.
Corresponding Class: The class of interests in any REMIC created
under this Agreement that correspond to the Class of interests in another such
REMIC or to a Class of Certificates in the manner set out below:
LOWER TIER UPPER TIER CORRESPONDING
CLASS DESIGNATION INTEREST CERTIFICATE
----------------- -------- -----------
Class LT-A-1 Class A-1 Class A-1
Class LT-A-2 Class A-2 Class A-2
Class LT-M-1 Class M-1 Class M-1
Class LT-M-2 Class M-2 Class M-2
Class LT-B-1 Class B-1 Class B-1
Class LT-B-2 Class B-2 Class B-2
Class X Class X
Cumulative Loss Percentage: With respect to any Distribution Date,
the percentage equivalent of a fraction, the numerator of which is the aggregate
amount of Applied Realized Loss Amounts incurred from the Cut-off Date to the
last day of the calendar month preceding the month in which such Distribution
Date occurs and the denominator of which is the Cut-off Date Pool Principal
Balance of the Mortgage Loans.
Current Maximum Amount: With respect to any Distribution Date, the
sum of (x) the aggregate of the Stated Principal Balances of the Mortgage Loans
as of such Distribution Date, and (y) (i) with respect to any Distribution Date
on or prior to August 25, 2002, the aggregate amount on deposit in the
Pre-Funding Accounts immediately prior to such Distribution Date, net of
Pre-Funding Earnings for such Distribution Date, or (ii) with respect to any
Distribution Date after August 25, 2002, zero.
Custodial Fee: As to any Distribution Date, an amount equal to the
product of (a) one-twelfth of the Custodial Fee Rate and (b) the sum of (i) the
aggregate Stated Principal Balance of the Mortgage Loans as of the first day of
the related Interest Accrual Period, and (ii) the Pre-Funded Amounts as of the
first day of the related Interest Accrual Period.
Custodial Fee Rate: With respect to each Mortgage Loan, 0.00075% per
annum.
Custodial File: With respect to each Mortgage Loan, the file
retained by the Trustee consisting of items (i) - (xx) as listed on Exhibit K
hereto.
Custodian: The Custodian, if any, appointed by the Trustee pursuant
to Section 8.14 acting as custodian with respect to the Custodial Files relating
to the Accredited Mortgage Loans.
Cut-off Date: With respect to the Initial Mortgage Loans, the
Initial Cut-off Date, and with respect to each Subsequent Mortgage Loan, the
related Subsequent Cut-off Date.
Cut-off Date Pool Principal Balance: The aggregate Stated Principal
Balances of all Mortgage Loans as of the Cut-off Date.
Cut-off Date Principal Balance: As to any Mortgage Loan, the Stated
Principal Balance thereof as of the close of business on the Cut-off Date.
Data Tape Information: The information provided by the Originators
as of June 1, 2002 to the Depositor or the Purchaser setting forth the following
information with respect to each Mortgage Loan: (1) the Mortgagor's name; (2) as
to each Mortgage Loan, the Scheduled Principal Balance as of the Cut-Off Date;
(3) the Mortgage Rate Cap; (4) the Index; (5) a code indicating whether the
Mortgaged Property is owner-occupied; (6) the type of Mortgaged Property; (7)
the first date on which the Monthly Payment was due on the Mortgage Loan and, if
such date is not consistent with the Due Date currently in effect, such Due
Date; (8) the "paid through date" based on payments received from the related
Mortgagor; (9) the original principal amount of the Mortgage Loan; (10) with
respect to Adjustable Rate Mortgage Loans, the Maximum Mortgage Rate; (11) the
type of Mortgage Loan (i.e., fixed or adjustable); (12) a code indicating the
purpose of the loan (i.e., purchase, rate and term refinance, equity take-out
refinance); (13) a code indicating the documentation style (i.e., full, asset
verification, income verification and no documentation); (14) the credit risk
score (FICO score); (15) the loan credit grade classification (as described in
the Underwriting Guidelines); (16) with respect to each Adjustable Rate Mortgage
Loan, the Minimum Mortgage Rate; (17) the Mortgage Rate at origination; (18)
with respect to each Adjustable Rate Mortgage Loan, the first Adjustment Date
immediately following the Cut-off Date; (19) the Value of the Mortgaged
Property; (20) a code indicating the type of Prepayment Charges applicable to
such Mortgage Loan, if any; (21) with respect to each Adjustable Rate Mortgage
Loan, the Periodic Mortgage Rate Cap and (22) the applicable Originator of such
Mortgage Loan. With respect to the Mortgage Loans in the aggregate, the Data
Tape Information shall set forth the following information, as of the Cut-off
Date: (1) the number of Mortgage Loans; (2) the current aggregate outstanding
principal balance of the Mortgage Loans; (3) the weighted average Mortgage Rate
of the Mortgage Loans; and (4) the weighted average maturity of the Mortgage
Loans.
Debt Service Reduction: With respect to any Mortgage Loan, a
reduction by a court of competent jurisdiction in a proceeding under the
Bankruptcy Code in the Scheduled Payment for such Mortgage Loan which became
final and non-appealable, except such a reduction resulting from a Deficient
Valuation or any reduction that results in a permanent forgiveness of principal.
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: Any Certificate evidenced by a Physical
Certificate and any Certificate issued in lieu of a Book-Entry Certificate
pursuant to Section 5.02(e).
Delay Certificates: As specified in the Preliminary Statement.
Delinquent: A mortgage loan is "Delinquent" if any monthly payment
due on a due date is not made by the close of business on the next scheduled due
date for that mortgage loan. A mortgage loan is "30 days Delinquent" if the
monthly payment has not been received by the close of business on the
corresponding day of the month immediately succeeding the month in which that
monthly payment was due or, if there was no corresponding date (e.g., as when a
30-day month follows a 31-day month in which the payment was due on the 31st day
of that month), then on the last day of that immediately preceding month; and
similarly for "60 days Delinquent" and "90 days Delinquent," etc.
Delivery Date: With respect to the Initial Mortgage Loans, the
Closing Date; with respect to any Subsequent Mortgage Loans, the related
Subsequent Transfer Date therefor.
Denomination: With respect to each Certificate, the amount set forth
on the face thereof as the "Initial Certificate Balance of this Certificate" or
the Percentage Interest appearing on the face thereof.
Depositor: Xxxxxx Xxxxxxx Xxxx Xxxxxx Capital I Inc. a Delaware
corporation, or its successor in interest.
Depository: The initial Depository shall be The Depository Trust
Company, the nominee of which is CEDE & Co., as the registered Holder of the
Book-Entry Certificates. The Depository shall at all times be a "clearing
corporation" as defined in Section 8-102(a)(5) of the Uniform Commercial Code of
the State of New York.
Depository Institution: Any depository institution or trust company,
including the Trustee, that (a) is incorporated under the laws of the United
States of America or any State thereof, (b) is subject to supervision and
examination by federal or state banking authorities and (c) has outstanding
unsecured commercial paper or other short-term unsecured debt obligations that
are rated P-1 by Moody's, F1+ by Fitch and A-1 by Standard & Poor's.
Depository Participant: A broker, dealer, bank or other financial
institution or other Person for whom from time to time a Depository effects
book-entry transfers and pledges of securities deposited with the Depository.
Determination Date: With respect to each Remittance Date, the 18th
calendar day (or if such day is not a Business Day the immediately preceding
Business Day) in the month in which such Remittance Date occurs.
Distribution Account: The separate Eligible Account created and
maintained by the Trustee pursuant to Section 3.07(d) in the name of the Trustee
for the benefit of the Certificateholders and designated "U.S. Bank National
Association in trust for registered holders of Xxxxxx Xxxxxxx Xxxx Xxxxxx
Capital I Inc. Mortgage Pass-Through Certificates, Series 2002-HE1." Funds in
the Distribution Account shall be held in trust for the Certificateholders for
the uses and purposes set forth in this Agreement.
Distribution Account Deposit Date: As to any Distribution Date,
12:30 p.m. Pacific time on the Business Day immediately preceding such
Distribution Date.
Distribution Date: The 25th day of each calendar month after the
initial issuance of the Certificates, or if such day is not a Business Day, the
next succeeding Business Day, commencing in July 2002.
Document Exception Report: The report attached to Exhibit F hereto.
Due Date: The day of the month on which the Scheduled Payment is due
on a Mortgage Loan, exclusive of any days of grace.
Due Period: With respect to each Remittance Date, the period
commencing on the second day of the month preceding the month of the Remittance
Date and ending on the first day of the month of the Remittance Date.
Eligible Account: Either (i) an account maintained with a federal or
state chartered depository institution or trust company the short-term unsecured
debt obligations of which (or, in the case of a depository institution or trust
company that is a subsidiary of a holding company, the short-term unsecured debt
obligations of such holding company) are rated "A-1" by Standard & Poor's and
"P-1" by Moody's (or a comparable rating if another Rating Agency is specified
by the Depositor by written notice to each Servicer) at the time any amounts are
held on deposit therein, (ii) an account or accounts the deposits in which are
fully insured by the FDIC, (iii) a trust account or accounts maintained with a
federal or state chartered depository institution or trust company acting in its
fiduciary capacity or (iv) any other account acceptable to each Rating Agency.
Eligible Accounts may bear interest, and may include, if otherwise qualified
under this definition, accounts maintained with the Trustee.
ERISA: The Employee Retirement Income Security Act of 1974, as
amended.
ERISA-Qualifying Underwriting: A best efforts or firm commitment
underwriting or private placement that meets the requirements of Prohibited
Transaction Exemption 2000-58, 65 Fed. Reg. 67765 (2000) (or any successor
thereto), or any substantially similar administrative exemption granted by the
U.S. Department of Labor.
ERISA-Restricted Certificate: As specified in the Preliminary
Statement.
Escrow Account: The Eligible Account or Accounts established and
maintained pursuant to Section 3.09(b).
Escrow Payments: As defined in Section 3.09(b) of this Agreement.
Event of Default: As defined in Section 7.01.
Excess Reserve Fund Account: The separate Eligible Account created
and maintained by the Trustee pursuant to Sections 3.07(b) and 3.07(c) in the
name of the Trustee for the benefit of the Regular Certificateholders and
designated "U.S. Bank National Association Company in trust for registered
holders of Xxxxxx Xxxxxxx Xxxx Xxxxxx Capital I Inc. Trust 2002-HE1, Mortgage
Pass-Through Certificates, Series 2002-HE1." Funds in the Excess Reserve Fund
Account shall be held in trust for the Regular Certificateholders for the uses
and purposes set forth in this Agreement.
Excess Subordinated Amount: With respect to any Distribution Date,
the excess, if any, of (a) the Subordinated Amount on such Distribution Date
over (b) the Specified Subordinated Amount for such Distribution Date.
Expense Fees: As to each Mortgage Loan, the sum of the Servicing
Fee, the Trustee Fee and the Custodial Fee.
Expense Fee Rate: As to each Mortgage Loan, a per-annum rate equal
to the sum of the Servicing Fee Rate, the Trustee Fee Rate and the Custodial Fee
Rate.
Extra Principal Distribution Amount: As of any Distribution Date,
the lesser of (x) the related Total Monthly Excess Spread for such Distribution
Date and (y) the Subordination Deficiency for such Distribution Date.
Xxxxxx Mae: The Federal National Mortgage Association, or any
successor thereto.
Xxxxxx Xxx Guides: The Xxxxxx Xxx Xxxxxxx' Guide and the Xxxxxx Xxx
Servicers' Guide and all amendments or additions thereto.
FDIC: The Federal Deposit Insurance Corporation, or any successor
thereto.
FHLMC: The Federal Home Loan Mortgage Corporation, a corporate
instrumentality of the United States created and existing under Title III of the
Emergency Home Finance Act of 1970, as amended, or any successor thereto.
Final Recovery Determination: With respect to any defaulted Mortgage
Loan or any REO Property (other than a Mortgage Loan or REO Property purchased
by the applicable Originator as contemplated by this Agreement), a determination
made by the applicable Servicer that all Insurance Proceeds, Liquidation
Proceeds and other payments or recoveries which the applicable Servicer, in its
reasonable good faith judgment, expects to be finally recoverable in respect
thereof have been so recovered. Each Servicer shall maintain records, prepared
by a Servicing Officer, of each Final Recovery Determination made thereby.
Final Scheduled Distribution Date: The Final Scheduled Distribution
Date for each Class of Certificates is the Distribution Date in each of the
following months:
FINAL SCHEDULED
DISTRIBUTION DATE
-----------------
Class A-1 Certificates.................................... July 25, 2032
Class A-2 Certificates.................................... July 25, 2032
Class M-1 Certificates.................................... July 25, 2032
Class M-2 Certificates.................................... July 25, 2032
Class B-1 Certificates.................................... July 25, 2032
Class B-2 Certificates.................................... July 25, 2032
Class X Certificates...................................... July 25, 2032
Class P Certificates...................................... July 25, 2032
Class R Certificates...................................... July 25, 2032
First Franklin: First Franklin Financial Corp., a Delaware
corporation, and its successors and assigns, in its capacity as an Originator
hereunder.
First Franklin Assignment Agreement: The Assignment and Recognition
Agreement, dated June 27, 2002, by and among the Depositor, the Purchaser and
First Franklin, and each other Assignment and Recognition Agreement by and among
the Depositor, the Purchaser and First Franklin in connection with any
Subsequent Transfer of First Franklin Mortgage Loans.
First Franklin Mortgage Loans: The Mortgage Loans identified as
being originated by First Franklin on the Mortgage Loan Schedule.
First Franklin Purchase Agreement: The Mortgage Loan Purchase and
Warranties Agreement, dated as of May 1, 2002, by and between the Purchaser and
First Franklin, as assigned by the Purchaser to the Depositor, solely insofar as
the First Franklin Purchase Agreement relates to the First Franklin Mortgage
Loans, pursuant to the First Franklin Assignment Agreement.
Fitch: Fitch, Inc., or any successor thereto. If Fitch is designated
as a Rating Agency in the Preliminary Statement, for purposes of Section
10.05(b) the address for notices to Fitch shall be Fitch, Inc., Xxx Xxxxx Xxxxxx
Xxxxx, Xxx Xxxx, XX 00000, Attention: MBS Monitoring - Xxxxxx Xxxxxxx Xxxx
Xxxxxx Capital I Inc. 2002-HE1, or such other address as Fitch may hereafter
furnish to the Depositor and the Servicers.
Fixed Rate Mortgage Loan: A fixed rate Mortgage Loan purchased
pursuant to a Purchase Agreement.
Gross Margin: With respect to each Adjustable Rate Mortgage Loan,
the fixed percentage amount set forth in the related Mortgage Note to be added
to the applicable Index to determine the Mortgage Rate.
Group I Mortgage Loans: The Mortgage Loans identified on the
Mortgage Loan Schedule as Group I Mortgage Loans.
Group I Pre-Funding Account: The separate Eligible Account created
and maintained by the Trustee pursuant to Section 3.07(f) in the name of the
Trustee for the benefit of the Certificateholders, and designated "U.S. Bank
National Association, in trust for registered holders of Xxxxxx Xxxxxxx Xxxx
Xxxxxx Capital I Inc. Trust 2002-HE1, Mortgage Pass-Through Certificates, Series
2002-HE1," the funds of which, during the Pre-Funding Period, shall be applied
solely to the purchase of Group I Subsequent Mortgage Loans.
Group I Subsequent Mortgage Loan: A Mortgage Loan hereafter
transferred and assigned to the Trust Fund pursuant to Section 2.01(c), (i)
which shall have been purchased by the Purchaser under a Purchase Agreement and
(ii) which shall satisfy the criteria for qualifying as a Group I Mortgage Loan
as set forth in Section 2.01(c).
Group II Mortgage Loans: The Mortgage Loans identified on the
Mortgage Loan Schedule as Group II Mortgage Loans.
Group II Pre-Funding Account: The separate Eligible Account created
and maintained by the Trustee pursuant to Section 3.07(f) in the name of the
Trustee for the benefit of the Certificateholders, and designated "U.S. Bank
National Association, in trust for registered holders of Xxxxxx Xxxxxxx Xxxx
Xxxxxx Capital I Inc. Trust 2002-HE1, Mortgage Pass-Through Certificates, Series
2002-HE1," the funds of which, during the Pre-Funding Period, shall be applied
solely to the purchase of Group II Subsequent Mortgage Loans.
Group II Subsequent Mortgage Loan: A Mortgage Loan hereafter
transferred and assigned to the Trust Fund pursuant to Section 2.01(c), (i)
which shall have been purchased by the Purchaser under a Purchase Agreement and
(ii) which shall satisfy the criteria for qualifying as a Group II Mortgage Loan
as set forth in Section 2.01(c).
Index: As to each Adjustable Rate Mortgage Loan, the index from time
to time in effect for the adjustment of the Mortgage Rate set forth as such on
the related Mortgage Note.
Initial Cut-off Date: The close of business on June 1, 2002.
Initial Mortgage Loans: The Mortgage Loans delivered by the
Depositor to the Trustee on the Closing Date.
Insurance Policy: With respect to any Mortgage Loan included in the
Trust Fund, any insurance policy, including all riders and endorsements thereto
in effect, including any replacement policy or policies for any Insurance
Policies.
Insurance Proceeds: With respect to each Mortgage Loan, proceeds of
insurance policies insuring the Mortgage Loan or the related Mortgaged Property.
Interest Accrual Period: With respect to each Class of Non-Delay
Certificates and the Corresponding Class of Lower Tier Regular Interests and any
Distribution Date, the period commencing on the Distribution Date occurring in
the month preceding the month in which the current Distribution Date occurs and
ending on the day immediately preceding the current Distribution Date (or, in
the case of the first Distribution Date, the period from and including the
Closing Date to but excluding such first Distribution Date). For purposes of
computing interest accruals on each Class of Non-Delay Certificates, each
Interest Accrual Period has the actual number of days in such month and each
year is assumed to have 360 days.
Interest Rate Adjustment Date: With respect to each Adjustable Rate
Mortgage Loan, the date, specified in the related Mortgage Note and the Mortgage
Loan Schedule, on which the Mortgage Rate is adjusted.
Investment Account: As defined in Section 3.12(a).
Late Collections: With respect to any Mortgage Loan and any Due
Period, all amounts received on or after the Remittance Date immediately
following such Due Period, whether as late payments of Monthly Payments or as
Insurance Proceeds, Liquidation Proceeds or otherwise, which represent late
payments or collections of principal and/or interest due (without regard to any
acceleration of payments under the related Mortgage and Mortgage Note) but
delinquent for such Due Period and not previously recovered.
LIBOR: With respect to any Interest Accrual Period for the LIBOR
Certificates, the rate determined by the Trustee on the related LIBOR
Determination Date on the basis of the offered rate for one-month U.S. dollar
deposits as such rate appears on Telerate Page 3750 as of 11:00 a.m. (London
time) on such date; provided that if such rate does not appear on Telerate Page
3750, the rate for such date will be determined on the basis of the rates at
which one-month U.S. dollar deposits are offered by the Reference Banks at
approximately 11:00 a.m. (London time) on such date to prime banks in the London
interbank market. In such event, the Trustee will request the principal London
office of each of the Reference Banks to provide a quotation of its rate. If at
least two such quotations are provided, the rate for that date will be the
arithmetic mean of the quotations (rounded upwards if necessary to the nearest
whole multiple of 1/16%). If fewer than two quotations are provided as
requested, the rate for that date will be the arithmetic mean of the rates
quoted by major banks in New York City, selected by the Trustee, at
approximately 11:00 a.m. (New York City time) on such date for one-month U.S.
dollar loan to leading European banks.
LIBOR Certificates: As specified in the Preliminary Statement.
LIBOR Determination Date: With respect to any Interest Accrual
Period (other than the initial Interest Accrual Period) for the LIBOR
Certificates, the second London Business Day preceding the commencement of such
Interest Accrual Period.
Liquidated Mortgage Loan: With respect to any Distribution Date, a
defaulted Mortgage Loan (including any REO Property) which was liquidated in the
calendar month preceding the month of such Distribution Date and as to which the
Servicer has certified (in accordance with this Agreement) that it has received
all amounts it expects to receive in connection with the liquidation of such
Mortgage Loan including the final disposition of an REO Property.
Liquidation Proceeds: Cash received in connection with the
liquidation of a defaulted Mortgage Loan, whether through a trustee's sale,
foreclosure sale or otherwise.
Loan-to-Value Ratio or LTV: With respect to any Mortgage Loan, the
ratio (expressed as a percentage) of the original outstanding principal amount
of the Mortgage Loan as of the Cut-off Date (unless otherwise indicated), to the
lesser of (a) the Appraised Value of the Mortgaged Property at origination, and
(b) if the Mortgage Loan was made to finance the acquisition of the related
Mortgaged Property, the purchase price of the Mortgaged Property.
London Business Day: Any day on which dealings in deposits of United
States dollars are transacted in the London interbank market.
Loan Group Cap: The Loan Group I Cap or the Loan Group II Cap, as
applicable.
Loan Group I Cap: With respect to the Group I Mortgage Loans as of
any Distribution Date, the product of (i) the weighted average of the Adjusted
Net Mortgage Rates then in effect on the beginning of the related Due Period on
the Group I Mortgage Loans and (ii) a fraction, the numerator of which is 30 and
the denominator of which is the actual number of days in the Interest Accrual
Period related to such Distribution Date.
Loan Group II Cap: With respect to the Group II Mortgage Loans as of
any Distribution Date, the product of (i) the weighted average of the Adjusted
Net Mortgage Rates then in effect on the beginning of the related Due Period on
the Group II Mortgage Loans and (ii) a fraction, the numerator of which is 30
and the denominator of which is the actual number of days in the Interest
Accrual Period related to such Distribution Date.
Lower Tier Regular Interest: Each of the Class LT-A-1, Class LT-A-2,
Class LT-M-1, Class LT-M-2, Class LT-B-1, Class LT-B-2 and Class LT-Accrual
Interests as described in the Preliminary Statement.
Lower Tier REMIC: As described in the Preliminary Statement.
Maximum Mortgage Rate: With respect to each Adjustable Rate Mortgage
Loan, a rate that (i) is set forth on the Data Tape Information and in the
related Mortgage Note and (ii) is the maximum interest rate to which the
Mortgage Rate on such Adjustable Rate Mortgage Loan may be increased during the
lifetime of such Adjustable Rate Mortgage Loan.
Minimum Mortgage Rate: With respect to each Adjustable Rate Mortgage
Loan, a rate that (i) is set forth on the Data Tape Information and in the
related Mortgage Note and (ii) is the minimum interest rate to which the
Mortgage Rate on such Adjustable Rate Mortgage Loan may be decreased during the
lifetime of such Adjustable Rate Mortgage Loan.
Monthly Statement: The statement delivered to the Certificateholders
pursuant to Section 4.03.
Moody's: Xxxxx'x Investors Service, Inc. If Xxxxx'x is designated as
a Rating Agency in the Preliminary Statement, for purposes of Section 10.05(b),
the address for notices to Moody's shall be Xxxxx'x Investors Service, Inc., 00
Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Residential Mortgage
Pass-Through Group, or such other address as Moody's may hereafter furnish to
the Depositor and the Servicers.
Mortgage: The mortgage, deed of trust or other instrument identified
on the Mortgage Loan Schedule as securing a Mortgage Note.
Mortgage File: The items pertaining to a particular Mortgage Loan
contained in either the Servicing File or Custodial File.
Mortgage Loans: An individual Mortgage Loan which is the subject of
this Agreement, each Mortgage Loan originally sold and subject to this Agreement
being identified on the Mortgage Loan Schedule, which Mortgage Loan includes,
without limitation, the Mortgage File, the Scheduled Payments, Principal
Prepayments, Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds,
REO Disposition proceeds, and all other rights, benefits, proceeds and
obligations arising from or in connection with such Mortgage Loan, excluding
repurchased Mortgage Loans.
Mortgage Loan Schedule: A schedule of Mortgage Loans annexed hereto
as Schedule I, such schedule setting forth the following information with
respect to each Mortgage Loan: (1) the applicable Originator's name and Mortgage
Loan number; (2) the city, state and zip code of the Mortgaged Property; (3) a
code indicating whether the Mortgaged Property is a single family residence,
two-family residence, three-family residence, four-family residence, PUD or
condominium; (4) the current Mortgage Interest Rate; (5) the current net
Mortgage Interest Rate; (6) the current Monthly Payment; (7) the Gross Margin;
(8) the original term to maturity; (9) the scheduled maturity date; (10) the
principal balance of the Mortgage Loan as of the Cut-off Date after deduction of
payments of principal due on or before the Cut-off Date whether or not
collected; (11) the Loan-to-Value Ratio; (12) the next Interest Rate Adjustment
Date; (13) the lifetime Mortgage Interest Rate Cap; (14) whether the Mortgage
Loan is convertible or not; (15) a code indicating the mortgage guaranty
insurance company; (16) the Servicing Fee; (17) if such Mortgage Loan is a Group
I Mortgage Loan or a Group II Mortgage Loan; (18) the date such Mortgage Loan
was sold by the applicable Originator to the Purchaser, (19) if such Mortgage
Loan is covered by a primary mortgage insurance policy, the Primary Mortgage
Insurance Rate and (20) whether such Mortgage Loan provides for a prepayment
penalty as well as the term and amount of such prepayment penalty, if any.
Mortgage Note: The note or other evidence of the indebtedness of a
Mortgagor under a Mortgage Loan.
Mortgage Rate: The annual rate of interest borne on a Mortgage Note,
which shall be adjusted from time to time in the case of an Adjustable Rate
Mortgage Loan.
Mortgage Rate Caps: With respect to an Adjustable Rate Mortgage
Loan, the Periodic Mortgage Rate Cap, the Maximum Mortgage Rate, and the Minimum
Mortgage Rate for such Mortgage Loan.
Mortgaged Property: The real property (or leasehold estate, if
applicable) identified on the Mortgage Loan Schedule as securing repayment of
the debt evidenced by a Mortgage Note.
Mortgagor: The obligor(s) on a Mortgage Note.
Net Monthly Excess Cash Flow: For any Distribution Date the amount
remaining for distribution pursuant to subsection 4.02(iii) (before giving
effect to distributions pursuant to such subsection).
Net Prepayment Interest Shortfall: For any Distribution Date, the
amount by which the sum of the Prepayment Interest Shortfalls exceeds the sum of
the Compensating Interest payments made on such Distribution Date.
New Century: NC Capital Corporation, a California corporation, and
its successors and assigns, in its capacity as an Originator hereunder.
New Century Assignment Agreement: The Assignment and Recognition
Agreement, dated June 27, 2002, by and among the Depositor, the Purchaser and
New Century, and each other Assignment and Recognition Agreement by and among
the Depositor, the Purchaser and New Century in connection with any Subsequent
Transfer of New Century Mortgage Loans.
New Century Mortgage Loans: The Mortgage Loans designated as being
originated by New Century on the Mortgage Loan Schedule.
New Century Purchase Agreements: The Mortgage Loan Purchase and
Warranties Agreements, dated as of April 1, 2002 and May 1, 2002, by and between
the Purchaser and New Century, as assigned by the Purchaser to the Depositor,
solely insofar as the New Century Purchase Agreements relate to the New Century
Mortgage Loans, pursuant to the New Century Assignment Agreement.
NIMs Trust: Xxxxxx Xxxxxxx Xxxx Xxxxxx Capital I Inc. NIM Trust
2002-HE1N, a Delaware business trust.
Non-Delay Certificates: As specified in the Preliminary Statement.
Nonrecoverable Advance: Any Servicing Advances previously made or
proposed to be made in respect of a Mortgage Loan or REO Property, which, in the
good faith business judgment of the applicable Servicer, will not or, in the
case of a proposed Servicing Advance, would not, be ultimately recoverable from
related Insurance Proceeds, Liquidation Proceeds or otherwise. The determination
by the applicable Servicer that it has made a Nonrecoverable Advance or that any
proposed Servicing Advances, if made, would constitute a Nonrecoverable Advance,
shall be evidenced by an Officers' Certificate delivered to the Trustee.
Nonrecoverable P&I Advance: Any P&I Advance previously made or
proposed to be made in respect of a Mortgage Loan or REO Property that, in the
good faith business judgment of the applicable Servicer, will not or, in the
case of a proposed P&I Advance, would not be ultimately recoverable from related
late payments, Insurance Proceeds or Liquidation Proceeds on such Mortgage Loan
or REO Property as provided herein.
Notice of Final Distribution: The notice to be provided pursuant to
Section 9.02 to the effect that final distribution on any of the Certificates
shall be made only upon presentation and surrender thereof.
Offered Certificates: As specified in the Preliminary Statement.
Officer's Certificate: A certificate signed by an officer of either
Servicer with responsibility for the servicing of the Mortgage Loans required to
be serviced by such Servicer and listed on a list delivered to the Trustee
pursuant to this Agreement.
Opinion of Counsel: A written opinion of counsel, who may be
in-house counsel for a Servicer or a Subservicer, reasonably acceptable to the
Trustee, provided that any Opinion of Counsel relating to (a) qualification of
the Mortgage Loans in a REMIC or (b) compliance with the REMIC Provisions, must
be (unless otherwise stated in such Opinion of Counsel) an opinion of counsel
who (i) is in fact independent of such Servicer of the Mortgage Loans, (ii) does
not have any material direct or indirect financial interest in such Servicer of
the Mortgage Loans or in an affiliate of either and (iii) is not connected with
such Servicer of the Mortgage Loans as an officer, employee, director or person
performing similar functions.
Optional Termination Date: The Distribution Date on which the
aggregate Stated Principal Balance of the Mortgage Loans is equal to 10.00% or
less of the Original Maximum Amount.
Original Group I Pre-Funded Amount: $42,700,000.
Original Group II Pre-Funded Amount: $5,200,000.
Original Maximum Amount: The sum of (x) the aggregate of the Stated
Principal Balances of the Initial Mortgage Loans as of the Cut-Off Date and (y)
the Original Pre-Funded Amount.
Original Pre-Funded Amount: The sum of the Original Group I
Pre-Funded Amount and the Original Group II Pre-Funded Amount.
Originators: Each of New Century, First Franklin and Accredited.
OTS: Office of Thrift Supervision, and any successor thereto.
Outstanding: With respect to the Certificates as of any date of
determination, all Certificates theretofore executed and authenticated under
this Agreement except:
(i) Certificates theretofore canceled by the Trustee or delivered to
the Trustee for cancellation; and
(ii) Certificates in exchange for which or in lieu of which other
Certificates have been executed and delivered by the Trustee pursuant to this
Agreement.
Outstanding Mortgage Loan: As of any Due Date, a Mortgage Loan with
a Stated Principal Balance greater than zero which was not the subject of a
Principal Prepayment in Full prior to such Due Date and which did not become a
Liquidated Mortgage Loan prior to such Due Date.
Ownership Interest: As to any Residual Certificate, any ownership
interest in such Certificate including any interest in such Certificate as the
Holder thereof and any other interest therein, whether direct or indirect, legal
or beneficial.
P&I Advance: As to any Mortgage Loan or REO Property, any advance
made by the applicable Servicer in respect of any Remittance Date representing
the aggregate of all payments of principal and interest, net of the Servicing
Fee, that were due during the related Due Period on the Mortgage Loans and that
were delinquent on the related Remittance Date, plus certain amounts
representing assumed payments not covered by any current net income on the
Mortgaged Properties acquired by foreclosure or deed in lieu of foreclosure as
determined pursuant to Section 4.01.
Pass-Through Margin: With respect to each Class of Regular
Certificates, the following percentages: Class A-1 Certificates, 0.365%; Class
A-2 Certificates, 0.330%, Class M-1 Certificates, 0.600%; Class M-2
Certificates, 1.300%; Class B-1 Certificates, 1.800%, and Class B-2
Certificates, 2.500%. On the first Distribution Date after the Optional
Termination Date, the Pass-Through Margins shall increase to: Class A-1
Certificates, 0.730%, Class A-2 Certificates, 0.660%, Class M-1 Certificates,
0.900%, Class M-2 Certificates, 1.950%, Class B-1 Certificates, 2.700% and Class
B-2 Certificates, 3.750%.
Pass-Through Rate: For each Class of Certificates and each Lower
Tier Regular Interest, the per annum rate set forth or calculated in the manner
described in the Preliminary Statement.
Percentage Interest: As to any Certificate, the percentage interest
evidenced thereby in distributions required to be made on the related Class,
such percentage interest being set forth on the face thereof or equal to the
percentage obtained by dividing the Denomination of such Certificate by the
aggregate of the Denominations of all Certificates of the same Class.
Periodic Mortgage Rate Cap: With respect to an Mortgage Loan, the
periodic limit on each Mortgage Interest Rate adjustment as set forth in the
related Mortgage Note.
Permitted Investments: Any one or more of the following obligations
or securities acquired at a purchase price of not greater than par, regardless
of whether issued by a Servicer, the Trustee or any of their respective
Affiliates:
(i) direct obligations of, or obligations fully guaranteed as to
timely payment of principal and interest by, the United States or any agency or
instrumentality thereof, provided such obligations are backed by the full faith
and credit of the United States;
(ii) demand and time deposits in, certificates of deposit of, or
bankers' acceptances (which shall each have an original maturity of not more
than 90 days and, in the case of bankers' acceptances, shall in no event have an
original maturity of more than 365 days or a remaining maturity of more than 30
days) denominated in United States dollars and issued by, any Depository
Institution and rated F1+ by Fitch;
(iii) repurchase obligations with respect to any security described
in clause (i) above entered into with a Depository Institution (acting as
principal);
(iv) securities bearing interest or sold at a discount that are
issued by any corporation incorporated under the laws of the United States of
America or any state thereof and that are rated by each Rating Agency that rates
such securities in its highest long-term unsecured rating categories at the time
of such investment or contractual commitment providing for such investment;
(v) commercial paper (including both non-interest-bearing discount
obligations and interest-bearing obligations payable on demand or on a specified
date not more than 30 days after the date of acquisition thereof) that is rated
by each Rating Agency that rates such securities in its highest short-term
unsecured debt rating available at the time of such investment;
(vi) units of money market funds, including money market funds
advised by the Depositor or an Affiliate thereof, that have been rated "Aaa" by
Moody's, "AAA" by Standard & Poor's and at least "AA" by Fitch; and
(vii) if previously confirmed in writing to the Trustee, any other
demand, money market or time deposit, or any other obligation, security or
investment, as may be acceptable to the Rating Agencies as a permitted
investment of funds backing "Aaa" or "AAA" rated securities;
provided, however, that no instrument described hereunder shall evidence either
the right to receive (a) only interest with respect to the obligations
underlying such instrument or (b) both principal and interest payments derived
from obligations underlying such instrument and the interest and principal
payments with respect to such instrument provide a yield to maturity at par
greater than 120% of the yield to maturity at par of the underlying obligations.
Permitted Transferee: Any person other than (i) the United States,
any State or political subdivision thereof, or any agency or instrumentality of
any of the foregoing, (ii) a foreign government, International Organization or
any agency or instrumentality of either of the foregoing, (iii) an organization
(except certain farmers' cooperatives described in Section 521 of the Code)
which is exempt from tax imposed by Chapter 1 of the Code (including the tax
imposed by Section 511 of the Code on unrelated business taxable income) on any
excess inclusions (as defined in Section 860E(c)(1) of the Code) with respect to
any Residual Certificate, (iv) rural electric and telephone cooperatives
described in Section 1381(a)(2)(C) of the Code, (v) a Person that is not a U.S.
Person, (vi) an "electing large partnership" within the meaning of Section 775
of the Code and (vii) any other Person so designated by the Depositor based upon
an Opinion of Counsel that the Transfer of an Ownership Interest in a Residual
Certificate to such Person may cause any REMIC hereunder to fail to qualify as a
REMIC at any time that the Certificates are outstanding. The terms "United
States," "State" and "International Organization" shall have the meanings set
forth in Section 7701 of the Code or successor provisions. A corporation will
not be treated as an instrumentality of the United States or of any State or
political subdivision thereof for these purposes if all of its activities are
subject to tax and, with the exception of the FHLMC, a majority of its board of
directors is not selected by such government unit.
Person: Any individual, corporation, partnership, joint venture,
association, limited liability company, joint-stock company, trust,
unincorporated organization or government, or any agency or political
subdivision thereof.
Physical Certificates: As specified in the Preliminary Statement.
Pool Stated Principal Balance: As to any Distribution Date, the
aggregate of the Stated Principal Balances of the Mortgage Loans for such
Distribution Date that were Outstanding Mortgage Loans on the Due Date in the
related Due Period.
Pre-Funding Accounts: The Group I Pre-Funding Account and the Group
II Pre-Funding Account.
Pre-Funded Amount: With respect to the Pre-Funding Accounts and any
date, the amount on deposit in the Pre-Funding Accounts.
Pre-Funding Earnings: With respect to a Pre-Funding Account, the
actual investment earnings realized on amounts deposited in such Pre-Funding
Account.
Pre-Funding Period: The period beginning on the Closing Date and
ending on the earliest to occur of (x) the date on which the amount on deposit
in any Pre-Funding Account is reduced below $100,000, (y) the date on which an
Event of Default occurs, and (z) the close of business on August 16, 2002.
Prepayment Charge: Any prepayment premium, penalty or charge
collected by the applicable Servicer with respect to a Mortgage Loan from a
Mortgagor in connection with any voluntary Principal Prepayment in full pursuant
to the terms of the related Mortgage Note.
Prepayment Interest Shortfall: With respect to any Remittance Date,
the sum of, for each Mortgage Loan that was during the related Prepayment Period
the subject of a Principal Prepayment which is not accompanied by an amount
equal to one month of interest that would have been due on such Mortgage Loan on
the next succeeding Due Date and which was applied by the applicable Servicer to
reduce the outstanding principal balance of such Mortgage Loan on a date
preceding the Due Date in the succeeding Prepayment Period, an amount equal to
the product of (a) the Mortgage Rate net of the Servicing Fee Rate for such
Mortgage Loan, (b) the amount of the Principal Prepayment for such Mortgage
Loan, (c) 1/360 and (d) the number of days commencing on the date on which such
Principal Prepayment was applied and ending on the last day of the related
Prepayment Period.
Prepayment Period: With respect to any Remittance Date, the calendar
month preceding the calendar month in which such Remittance Date occurs.
Primary Mortgage Insurance Rate: With respect to any Mortgage Loan
covered by a primary mortgage insurance policy, the applicable rate set forth on
the Mortgage Loan Schedule.
Principal Distribution Amount: For any Distribution Date, the sum of
(i) the Basic Principal Distribution Amount for such Distribution Date and (ii)
the Extra Principal Distribution Amount for such Distribution Date.
Principal Prepayment: Any full or partial payment or other recovery
of principal on a Mortgage Loan (including upon liquidation of a Mortgage Loan)
which is received in advance of its scheduled Due Date, excluding any prepayment
penalty or premium thereon.
Principal Prepayment in Full: Any Principal Prepayment made by a
Mortgagor of the entire principal balance of a Mortgage Loan.
Principal Remittance Amount: With respect to any Distribution Date,
the amount equal to the sum of the following amounts (without duplication) with
respect to the immediately preceding Due Period: (i) each scheduled payment of
principal on a Mortgage Loan due during such Due Period and received or advanced
by the applicable Servicer prior to the related Remittance Date (including the
portion of Insurance Proceeds or Condemnation Proceeds allocable to principal),
and all Principal Prepayments received during the related Prepayment Period,
(ii) the Liquidation Proceeds on the Mortgage Loans allocable to principal
actually collected by the Servicers during the related Prepayment Period, (iii)
the portion of the purchase price allocable to principal with respect to each
Mortgage Loan, the repurchase obligation for which arose during the related
Prepayment Period that was repurchased during the period from the prior
Distribution Date through Distribution Account Deposit Date and (iv) the
allocable portion of the proceeds received with respect to the termination of
the Trust Fund (to the extent such proceeds relate to principal).
Private Certificates: As specified in the Preliminary Statement.
Prospectus Supplement: The Prospectus Supplement, dated June 21,
2002, relating to the Offered Certificates.
PTCE 95-60: As defined in Section 5.02(b).
PUD: Planned Unit Development.
Purchase Agreement: Each of the Accredited Purchase Agreement, the
First Franklin Purchase Agreement and/or the New Century Purchase Agreements.
Purchaser: Xxxxxx Xxxxxxx Xxxx Xxxxxx Mortgage Capital Inc. as
purchaser of the Mortgage Loans under each of the Purchase Agreements.
Qualified Insurer: A mortgage guaranty insurance company duly
qualified as such under the laws of the state of its principal place of business
and each state having jurisdiction over such insurer in connection with the
insurance policy issued by such insurer, duly authorized and licensed in such
states to transact a mortgage guaranty insurance business in such states and to
write the insurance provided by the insurance policy issued by it, approved as a
FNMA- or FHLMC-approved mortgage insurer or having a claims paying ability
rating of at least "AA" or equivalent rating by a nationally recognized
statistical rating organization. Any replacement insurer with respect to a
Mortgage Loan must have at least as high a claims paying ability rating as the
insurer it replaces had on the Closing Date.
Rating Agency: Each of the Rating Agencies specified in the
Preliminary Statement. 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, as is designated by the
Depositor, notice of which designation shall be given to the Trustee. References
herein to a given rating or rating category of a Rating Agency shall mean such
rating category without giving effect to any modifiers. For purposes of Section
10.05(b), the addresses for notices to each Rating Agency shall be the address
specified therefor in the definition corresponding to the name of such Rating
Agency, or such other address as either such Rating Agency may hereafter furnish
to the Depositor and the Servicers.
Record Date: With respect to any Distribution Date, the close of
business on the Business Day immediately preceding such Distribution Date;
provided, however, that for any Certificate issued in Definitive Form, the
Record Date shall be the close of business on the last Business Day of the month
preceding the month in which such applicable Distribution Date occurs.
Reference Bank: As defined in Section 4.04.
Regular Certificates: As specified in the Preliminary Statement.
Relief Act Interest Shortfall: With respect to any Distribution Date
and any Mortgage Loan, any reduction in the amount of interest collectible on
such Mortgage Loan for the most recently ended Due Period as a result of the
application of the Soldiers' and Sailors' Civil Relief Act of 1940, as amended.
REMIC: A "real estate mortgage investment conduit" within the
meaning of Section 860D of the Code.
REMIC Provisions: Provisions of the federal income tax law relating
to real estate mortgage investment conduits, which appear at sections 860A
through 860G of Subchapter M of Chapter 1 of the Code, and related provisions,
and regulations promulgated thereunder, as the foregoing may be in effect from
time to time as well as provisions of applicable state laws.
Remittance Date: With respect to any Distribution Date, the Business
Day immediately preceding such Distribution Date.
REO Disposition: The final sale by the applicable Servicer of any
REO Property.
REO Imputed Interest: As to any REO Property, for any period, an
amount equivalent to interest (at the Mortgage Rate net of the Servicing Fee
Rate that would have been applicable to the related Mortgage Loan had it been
outstanding) on the unpaid principal balance of the Mortgage Loan as of the date
of acquisition thereof (as such balance is reduced pursuant to Section 3.17 by
any income from the REO Property treated as a recovery of principal).
REO Property: A Mortgaged Property acquired by the Trust Fund
through foreclosure or deed-in-lieu of foreclosure in connection with a
defaulted Mortgage Loan.
Repurchase Price: With respect to any Mortgage Loan, an amount equal
to the sum of (i) the unpaid principal balance of such Mortgage Loan as of the
date of repurchase, (ii) interest on such unpaid principal balance of such
Mortgage Loan at the Mortgage Rate from the last date through which interest has
been paid and distributed to the Trustee to the date of repurchase, (iii) all
unreimbursed Servicing Advances and (iv) all expenses incurred by the Trustee
arising out of the Trustee's enforcement of the repurchase obligation of any
Originator under either the related Purchase Agreement or the related Assignment
Agreement, to the extent such Originator has agreed to provide indemnification
for such expenses pursuant to the related Purchase Agreement.
Request for Release: The Request for Release submitted by either
Servicer to the Trustee or the Custodian, on behalf of the Trustee,
substantially in the form of Exhibit J.
Residual Certificates: As specified in the Preliminary Statement.
Responsible Officer: When used with respect to the Trustee, any Vice
President, any Assistant Vice President, any Assistant Secretary, any Assistant
Treasurer, or any other officer of the Trustee customarily performing functions
similar to those performed by any of the above designated officers who at such
time shall be officers to whom, with respect to a particular matter, such matter
is referred because of such officer's knowledge of and familiarity with the
particular subject and who shall have direct responsibility for the
administration of this Agreement.
Rule 144A Letter: As defined in Section 5.01(b).
Scheduled Payment: The scheduled monthly payment on a Mortgage Loan
due on any Due Date allocable to principal and/or interest on such Mortgage Loan
which, unless otherwise specified herein, shall give effect to any related Debt
Service Reduction and any Deficient Valuation that affects the amount of the
monthly payment due on such Mortgage Loan.
Securities Act: The Securities Act of 1933, as amended.
Senior Enhancement Percentage: With respect to any Distribution
Date, the percentage obtained by dividing (x) the sum of (i) the aggregate Class
Certificate Balance of the Subordinated Certificates and (ii) the Subordinated
Amount (in each case after taking into account the distributions of the
Principal Distribution Amount for such Distribution Date) by (y) the aggregate
Stated Principal Balance of the Mortgage Loans for such Distribution Date.
Senior Specified Enhancement Percentage: As of any date of
determination, 38.00%.
Servicers: Each of Ocwen Federal Bank FSB, a federally chartered
savings bank, and its successors and assigns and The Provident Bank, an Ohio
banking corporation, and its successors and assigns. When the term "Servicer" is
used in this Agreement in connection with the administration of servicing
obligations with respect to any Mortgage Loan, Mortgaged Property, REO Property
or Mortgage File, "Servicer" shall mean (i) Ocwen Federal Bank FSB with respect
to the New Century Mortgage Loans and the First Franklin Mortgage Loans and (ii)
The Provident Bank with respect to the Accredited Mortgage Loans.
Servicing Advances: The reasonable "out-of-pocket" costs and
expenses (including legal fees) incurred by the applicable Servicer in the
performance of its servicing obligations in connection with a default,
delinquency or other unanticipated event, including, but not limited to, the
cost of (i) the preservation, restoration and protection of a Mortgaged
Property, (ii) any enforcement or judicial proceedings, including foreclosures
and litigation, in respect of a particular Mortgage Loan, (iii) the management
(including reasonable fees in connection therewith) and liquidation of any REO
Property and (iv) the performance of its obligations under Section 3.01, Section
3.09, Section 3.13 and Section 3.15 hereof. Neither Servicer shall be required
to make any Nonrecoverable Advances.
Servicing Fee: With respect to each Servicer, each Mortgage Loan
serviced by such Servicer and for any calendar month, an amount equal to one
month's interest (or in the event of any payment of interest which accompanies a
Principal Prepayment in full made by the Mortgagor during such calendar month,
interest for the number of days covered by such payment of interest) at the
Servicing Fee Rate on the same principal amount on which interest on such
Mortgage Loan accrues for such calendar month. Such fee shall be payable
monthly, and shall be pro rated for any portion of a month during which the
Mortgage Loan is serviced by the such Servicer under this Agreement. The
Servicing Fee is payable solely from the interest portion (including recoveries
with respect to interest from Liquidation Proceeds and proceeds received with
respect to REO Properties, to the extent permitted by Section 3.11) of such
Monthly Payment collected by such Servicer, or as otherwise provided under
Section 3.11.
Servicing Fee Rate: With respect to each Mortgage Loan, 0.50% per
annum.
Servicing File: With respect to each Mortgage Loan, the file
retained by the applicable Servicer consisting of originals or copies of all
documents in the Mortgage File which are not delivered to the Trustee in the
Custodial File and copies of the Mortgage Loan Documents set forth in Exhibit K
hereto.
Servicing Officer: Any officer of either Servicer involved in, or
responsible for, the administration and servicing of the Mortgage Loans whose
name and facsimile signature appear on a list of servicing officers furnished to
the Trustee by such Servicer on the Closing Date pursuant to this Agreement, as
such list may from time to time be amended.
Servicer Termination Test: With respect to any Distribution Date,
the Servicer Termination Test will be failed with respect to a Servicer if the
Cumulative Loss Percentage, with respect to the Mortgage Loans serviced by such
Servicer, exceeds the applicable percentages set forth with respect to such
Distribution Date:
Distribution Date Occurring In Percentage
July 2002 through June 2004 2.50%
July 2004 through June 2005 3.00%
July 2005 through June 2006 3.50%
July 2006 and thereafter 4.50%
Similar Law: As defined in Section 5.02(b).
Specified Subordinated Amount: Prior to the Stepdown Date, an amount
equal to 1.25% of the Original Maximum Amount, and on and after the Stepdown
Date, an amount equal to 2.50% of the Current Maximum Amount for such
Distribution Date, subject to a minimum amount equal to 0.50% of the Original
Maximum Amount; provided, however, that if, on any Distribution Date, a Trigger
Event has occurred, the Specified Subordinated Amount shall not be reduced to
the applicable percentage of the Current Maximum Amount until the Distribution
Date on which a Trigger Event is no longer occurring.
Standard & Poor's: Standard & Poor's Ratings Services, a division of
the XxXxxx-Xxxx Companies, Inc. If Standard & Poor's is designated as a Rating
Agency in the Preliminary Statement, for purposes of Section 10.05(b) the
address for notices to Standard & Poor's shall be Xxxxxxxx & Xxxx'x, 00 Xxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attention: Residential Mortgage Surveillance Group -
Xxxxxx Xxxxxxx Xxxx Xxxxxx Capital I Inc. 2002-HE1, or such other address as
Standard & Poor's may hereafter furnish to the Depositor and the Servicers.
Startup Day: The Closing Date.
Stated Principal Balance: As to each Mortgage Loan and as of any
date of determination (i) the Principal Balance of the Mortgage Loan at the
Cut-off Date after giving effect to payments of principal due on or before such
date, minus (ii) all amounts previously remitted to the Trustee with respect to
the related Mortgage Loan representing payments or recoveries of principal,
including advances in respect of scheduled payments of principal. For purposes
of any Distribution Date, the Stated Principal Balance of any Mortgage Loan will
give effect to any scheduled payments of principal received or advanced prior to
the related Remittance Date and any unscheduled principal payments and other
unscheduled principal collections received during the related Prepayment Period.
Stepdown Date: The later to occur of (i) the earlier to occur of (a)
the Distribution Date in July 2005 and (b) the date on which the aggregate Class
Certificate Balances of the Class A Certificates have been reduced to zero and
(ii) the first Distribution Date on which the Senior Enhancement Percentage
(calculated for this purpose only after taking into account payments of
principal applied to reduce the Stated Principal Balance of the Mortgage Loans
for the applicable Distribution Date but prior to any applications of Principal
Distribution Amount to the Certificates) is greater than or equal to the Senior
Specified Enhancement Percentage.
Subordinated Amount: As of any Distribution Date, the excess, if
any, of (a) the Current Maximum Amount for such Distribution Date over (b) the
aggregate of the Class Certificate Balances of the LIBOR Certificates as of such
Distribution Date (after giving effect to the payment of the Principal
Remittance Amount on such Certificates on such Distribution Date).
Subordinated Certificates: As specified in the Preliminary
Statement.
Subordination Deficiency: With respect to any Distribution Date, the
excess, if any, of (a) the Specified Subordinated Amount applicable to such
Distribution Date over (b) the Subordinated Amount applicable to such
Distribution Date.
Subordination Reduction Amount: With respect to any Distribution
Date, an amount equal to the lesser of (a) the Excess Subordinated Amount and
(b) the Total Monthly Excess Spread.
Subsequent Cut-off Date: As to any Subsequent Mortgage Loan, the
date specified in the Addition Notice delivered in connection therewith, which
date shall be the close of business on the first day of the month in which such
Subsequent Mortgage Loan will be conveyed to the Trust Fund.
Subsequent Mortgage Loan: A Group I Subsequent Mortgage Loan or a
Group II Subsequent Mortgage Loan.
Subsequent Transfer: A transfer and assignment by the Depositor to
the Trust of one or more Subsequent Mortgage Loans pursuant to the terms hereof.
Subsequent Transfer Agreement: A subsequent transfer agreement in
substantially the form of Exhibit K.
Subsequent Transfer Date: The Business Day on which a Subsequent
Transfer occurs.
Subservicer: As defined in Section 3.02(a).
Subservicing Account: As defined in Section 3.08.
Tax Service Contract: As defined in Section 3.09(a).
Telerate Page 3750: The display page currently so designated on the
Bridge Telerate Service (or such other page as may replace that page on that
service for displaying comparable rates or prices).
Total Monthly Excess Spread: As to any Distribution Date, an amount
equal to the excess if any, of (i) the interest collected or advanced on the
Mortgage Loans for Due Dates during the related Remittance Period (net of
Expense Fees) over (ii) the sum of the interest payable to the Classes of
Certificates on such Distribution Date.
Transfer: Any direct or indirect transfer or sale of any Ownership
Interest in a Residual Certificate.
Transfer Affidavit: As defined in Section 5.02(b).
Transferor Certificate: As defined in Section 5.02(b).
Trigger Event: After the Stepdown Date, a Trigger Event exists if
(i) the quotient (expressed as a percentage) of (x) the rolling three month
average of the Stated Principal Balances of Mortgage Loans 60 days Delinquent or
more, divided by (y) the aggregate Stated Principal Balance of the Mortgage
Loans exceeds 40% of the prior period's Senior Enhancement Percentage or (ii)
the quotient (expressed as a percentage) of (x) the aggregate amount of Realized
Losses incurred since the Cut-off Date through the last day of the related
Prepayment Period divided by (y) the Cut-off Date Pool Principal Balance exceeds
the applicable percentages set forth below with respect to any Distribution
Date:
DISTRIBUTION DATE OCCURRING IN LOSS PERCENTAGE
------------------------------ ---------------
July 2005 through June 2006 4.00% for the first month, plus an
additional 1/12th of 2.00% for each
month thereafter (e.g., 5.00% in
January 2006)
July 2006 through June 2007 6.00% for the first month, plus an
additional 1/12th of 1.00% for each
month thereafter (e.g., 6.50% in
January 2007)
July 2007 through June 2008 7.00% for the first month, plus an
additional 1/12th of 0.50% for each
month thereafter (e.g., 7.25% in
January 2008)
July 2008 and thereafter 7.50%
Trust Fund: The corpus of the trust created hereunder consisting of
(i) the Mortgage Loans and all interest and principal received on or with
respect thereto after the related Cut-off Date, other than such amounts which
were due on the Mortgage Loans on or before the related Cut-off Date; (ii) the
Collection Accounts, Excess Reserve Fund Account, the Distribution Account, and
all amounts deposited therein pursuant to the applicable provisions of this
Agreement; (iii) property that secured a Mortgage Loan and has been acquired by
foreclosure, deed-in-lieu of foreclosure or otherwise; and (iv) all proceeds of
the conversion, voluntary or involuntary, of any of the foregoing.
Trustee: U.S. Bank National Association and its successors and, if a
successor trustee is appointed hereunder, such successor.
Trustee Fee: As to any Distribution Date, an amount equal to the
product of (a) one-twelfth of the Trustee Fee Rate and (b) the sum of (i) the
aggregate Stated Principal Balance of the Mortgage Loans as of the first day of
the related Interest Accrual Period, and (ii) the Pre-Funded Amounts as of the
first day of the related Interest Accrual Period.
Trustee Fee Rate: With respect to each Mortgage Loan, 0.0032% per
annum.
Underwriters' Exemption: Any exemption listed under footnote 7 of,
and amended by, Prohibited Transaction Exemption 2000-58, 65 Fed. Reg. 67765
(2000), or any successor exemption.
Unpaid Interest Amounts: As of any Distribution Date and any Class
of Certificates, the sum of (a) the portion of the Accrued Certificate Interest
Distribution Amount from prior Distribution Dates remaining unpaid and (b) 30
days' interest on such unpaid amount at the applicable Pass-Through Rate (to the
extent permitted by applicable law).
Unpaid Realized Loss Amount: With respect to any Class of
Subordinated Certificates and as to any Distribution Date, is the excess of (i)
Applied Realized Loss Amounts with respect to such Class over (ii) the sum of
all distributions in reduction of such Applied Realized Loss Amounts on all
previous Distribution Dates. Any amounts distributed to a Class of Subordinated
Certificates in respect of any Unpaid Realized Loss Amount will not be applied
to reduce the Class Certificate Balance of such Class.
U.S. Person: Shall mean (i) a citizen or resident of the United
States; (ii) a corporation (or entity treated as a corporation for tax purposes)
created or organized in the United States or under the laws of the United States
or of any state thereof, including, for this purpose, the District of Columbia;
(iii) a partnership (or entity treated as a partnership for tax purposes)
organized in the United States or under the laws of the United States or of any
state thereof, including, for this purpose, the District of Columbia (unless
provided otherwise by future Treasury regulations); (iv) an estate whose income
is includible in gross income for United States income tax purposes regardless
of its source; or (v) a trust, if a court within the United States is able to
exercise primary supervision over the administration of the trust and one or
more U.S. Persons have authority to control all substantial decisions of the
trust. Notwithstanding the last clause of the preceding sentence, to the extent
provided in Treasury regulations, certain trusts in existence on August 20,
1996, and treated as U.S. Persons prior to such date, may elect to continue to
be U.S. Persons.
Upper Tier Regular Interest: As described in the Preliminary
Statement.
Upper Tier REMIC: As described in the Preliminary Statement.
Voting Rights: The portion of the voting rights of all of the
Certificates which is allocated to any Certificate. As of any date of
determination, (a) 1% of all Voting Rights shall be allocated to the Class X
Certificates, if any (such Voting Rights to be allocated among the holders of
Certificates of each such Class in accordance with their respective Percentage
Interests), (b) 1% of all Voting Rights shall be allocated to the Class P
Certificates, if any, and (c) the remaining Voting Rights shall be allocated
among Holders of the remaining Classes of Certificates in proportion to the
Certificate Balances of their respective Certificates on such date.
WAC Cap: With respect to the Mortgage Loans as of any Distribution
Date, the product of (i) the weighted average of the Adjusted Net Mortgage Rates
then in effect on the beginning of the related Due Period on the Mortgage Loans
and (ii) a fraction, the numerator of which is 30 and the denominator of which
is the actual number of days in the Interest Accrual Period related to such
Distribution Date.
ARTICLE II
CONVEYANCE OF MORTGAGE LOANS;
REPRESENTATIONS AND WARRANTIES
Section 2.01 Conveyance of Mortgage Loans.
(a) The Depositor, concurrently with the execution and delivery
hereof, hereby sells, transfers, assigns, sets over and otherwise conveys to the
Trustee for the benefit of the Certificateholders, without recourse, all the
right, title and interest of the Depositor in and to the Trust Fund, together
with all rights of the Depositor under the Assignment Agreements and the
Purchase Agreements (solely insofar as such Agreements relate to the Accredited
Mortgage Loans, the First Franklin Mortgage Loans and the New Century Mortgage
Loans, as applicable), other than any Subsequent Mortgage Loans, which will be
so sold, transferred, assigned, set-over and conveyed on the related Subsequent
Transfer Date.
(b) In connection with the transfer and assignment of each
Mortgage Loan, the Depositor has delivered or caused to be delivered to the
Trustee or the Custodian, as applicable, for the benefit of the
Certificateholders the following documents or instruments with respect to each
Mortgage Loan so assigned:
(i) the original Mortgage Note bearing all intervening endorsements,
endorsed "Pay to the order of _____________, without recourse" and signed
in the name of the last endorsee by an authorized officer. To the extent
that there is no room on the face of the Mortgage Notes for endorsements,
the endorsement may be contained on an allonge, if state law so allows and
the Trustee is so advised in writing by the applicable Originator
(pursuant to the applicable Purchase Agreement) that state law so allows;
(ii) the original of any guaranty executed in connection with the
Mortgage Note;
(iii) the original Mortgage with evidence of recording thereon or a
certified true copy of such Mortgage submitted for recording. If, in
connection with any Mortgage Loan, the original Mortgage cannot be
delivered with evidence of recording thereon on or prior to the related
Delivery Date because of a delay caused by the public recording office
where such Mortgage has been delivered for recordation or because such
Mortgage has been lost or because such public recording office retains the
original recorded Mortgage, the Trustee shall notify the applicable
Originator to deliver or cause to be delivered to the Trustee, as required
under the applicable Purchase Agreement, a photocopy of such Mortgage,
together with (i) in the case of a delay caused by the public recording
office, an Officer's Certificate of the applicable Originator or a
certificate from an escrow company, a title company or closing attorney
stating that such Mortgage has been dispatched to the appropriate public
recording office for recordation and that the original recorded Mortgage
or a copy of such Mortgage certified by such public recording office to be
a true and complete copy of the original recorded Mortgage will be
promptly delivered to the Trustee upon receipt thereof by the applicable
Originator; or (ii) in the case of a Mortgage where a public recording
office retains the original recorded Mortgage or in the case where a
Mortgage is lost after recordation in a public recording office, a copy of
such Mortgage certified by such public recording office to be a true and
complete copy of the original recorded Mortgage;
(iv) the originals of all assumption, modification, consolidation or
extension agreements, with evidence of recording thereon;
(v) the original Assignment of Mortgage for each Mortgage Loan
endorsed in blank;
(vi) the originals of all intervening assignments of mortgage (if
any) evidencing a complete chain of assignment from the applicable
originator to the last endorsee with evidence of recording thereon, or if
any such intervening assignment has not been returned from the applicable
recording office or has been lost or if such public recording office
retains the original recorded assignments of mortgage, the Trustee shall
notify the applicable Originator, to deliver, as required under the
applicable Purchase Agreement, a photocopy of such intervening assignment,
together with (i) in the case of a delay caused by the public recording
office, an Officer's Certificate of the applicable Originator or a
certificate from an escrow company, a title company or a closing attorney
stating that such intervening assignment of mortgage has been dispatched
to the appropriate public recording office for recordation and that such
original recorded intervening assignment of mortgage or a copy of such
intervening assignment of mortgage certified by the appropriate public
recording office to be a true and complete copy of the original recorded
intervening assignment of mortgage will be promptly delivered to the
Trustee upon receipt thereof by the applicable Originator; or (ii) in the
case of an intervening assignment where a public recording office retains
the original recorded intervening assignment or in the case where an
intervening assignment is lost after recordation in a public recording
office, a copy of such intervening assignment certified by such public
recording office to be a true and complete copy of the original recorded
intervening assignment;
(vii) except with respect to any First Franklin Mortgage Loan, the
original mortgagee title insurance policy or attorney's opinion of title
and abstract of title, or, in the event such original title policy is
unavailable, a certified true copy of the related policy binder or
commitment for title certified to be true and complete by the title
insurance company; and
(viii) the original of any security agreement, chattel mortgage or
equivalent document executed in connection with the Mortgage (if
provided).
The Depositor will use its reasonable efforts to assist the Trustee
and the Servicers in enforcing the obligations of the Originators under the
Purchase Agreements.
The Depositor shall cause to be delivered to the Trustee the
applicable recorded document promptly upon receipt from the respective recording
office but in no event later than 120 days from the related Delivery Date.
From time to time, the Depositor or the applicable Servicer, as
applicable, shall forward to the Trustee or the Custodian, as applicable,
additional original documents, additional documents evidencing an assumption,
modification, consolidation or extension of a Mortgage Loan in accordance with
the terms of this Agreement upon receipt of such documents. All such mortgage
documents held by the Trustee or the Custodian, as applicable, as to each
Mortgage Loan shall constitute the "Custodial File."
No later than thirty (30) Business Days following the later of the
related Delivery Date and the date of receipt by the applicable Servicer of the
recording information for a Mortgage, such Servicer shall promptly submit or
cause to be submitted for recording at the expense of the applicable Originator
as required pursuant to the related Purchase Agreement and at no expense to the
Trust Fund, the Trustee or the Depositor, in the appropriate public office for
real property records, each Assignment referred to in Section 2.01(b)(v).
Notwithstanding the foregoing, however, for administrative convenience and
facilitation of servicing and to reduce closing costs, the Assignments shall not
be required to be completed and submitted for recording with respect to any
Mortgage Loan (i) if the Trustee and each Rating Agency has received an opinion
of counsel, satisfactory in form and substance to the Trustee and each Rating
Agency, to the effect that the recordation of such Assignments in any specific
jurisdiction is not necessary to protect the Trustee's interest in the related
Mortgage Note or (ii) if the Rating Agencies have each notified the Depositor in
writing that not recording any such Assignments would not cause the initial
ratings on any LIBOR Certificate to be downgraded or withdrawn. If the
Assignment of Mortgage is to be recorded, the Mortgage shall be assigned to
"U.S. Bank National Association, as trustee under the Pooling and Servicing
Agreement dated as of June 1, 2002, Xxxxxx Xxxxxxx Xxxx Xxxxxx Capital I Inc.
Trust 2002-HE1." In the event that any such assignment is lost or returned
unrecorded because of a defect therein, the Depositor shall promptly cause to be
delivered a substitute assignment to cure such defect and thereafter cause each
such assignment to be duly recorded.
On or prior to the Closing Date, the Depositor shall deliver to the
Trustee a copy of the Data Tape Information in electronic, machine readable
medium in a form mutually acceptable to the Trustee.
(c) Purchase and Sale of Subsequent Mortgage Loans. (1) Subject to
the satisfaction of the conditions set forth in paragraph (ii) below, and upon
the Trustee's receipt of a Subsequent Transfer Agreement executed by all other
parties thereto, in consideration of the Trustee's delivery on the related
Subsequent Transfer Dates to (or upon the order of the Depositor) of all or a
portion of the balance of funds in the related Pre-Funding Account or both
Pre-Funding Accounts, as applicable, the Depositor shall on any Subsequent
Transfer Date sell, transfer, assign, set-over and convey to the Trustee without
recourse, but subject to terms and provisions of this Agreement, all of the
right, title and interest of the Depositor in and to the Subsequent Mortgage
Loans, including the outstanding principal of and interest due on such
Subsequent Mortgage Loans after the applicable Subsequent Cut-off Date, and all
other related assets included or to be included in the Trust Fund with respect
thereto.
The amount released from the related Pre-Funding Account or both
Pre-Funding Accounts, as applicable, with respect to a transfer of Subsequent
Mortgage Loans shall be one-hundred percent (100%) of the aggregate Stated
Principal Balances as of the related Subsequent Cut-off Date of the Subsequent
Mortgage Loans so transferred.
(i) The Subsequent Mortgage Loans and the other property and rights
related thereto described in paragraph (a) above shall be transferred by
the Depositor to the Trust Fund only upon the satisfaction of each of the
following conditions on or prior to the related Subsequent Transfer Date:
(a) the Depositor shall have provided the Trustee with a
timely Addition Notice, which shall include a Mortgage Loan
Schedule, listing the Subsequent Mortgage Loans, and shall have
provided any other information reasonably requested by any of the
foregoing with respect to the Subsequent Mortgage Loans;
(b) the applicable Servicer shall have deposited in the
related Collection Account all collections of (x) principal in
respect of the Subsequent Mortgage Loans received and due after the
related Subsequent Cut-off Date and (y) interest due on the
Subsequent Mortgage Loans after the related Subsequent Cut-off Date;
(c) the Pre-Funding Period shall not have terminated;
(d) the Purchaser shall have delivered to the Trustee an
executed Assignment and Recognition Agreement with respect to each
related Originator of Subsequent Mortgage Loans to be added to the
Trust Fund on such Subsequent Transfer Date; and
(e) the Purchaser and the Depositor shall have delivered to
the Trustee an executed copy of a Subsequent Transfer Agreement,
substantially in the form of Exhibit L hereto.
(ii) The obligation of the Trust fund to purchase the Subsequent
Mortgage Loans on a Subsequent Transfer Date is subject to the
requirements that, following the purchase of such Subsequent Mortgage
Loans, and with respect to the entire mortgage loan pool taking into
account such purchased Subsequent Mortgage Loans:
(a) no more than 30.00% may be Fixed Rate Mortgage Loans;
(b) the weighted average original term to maturity may not
exceed 360 months;
(c) the weighted average gross Mortgage Rate must not be less
than 8.50%, or more than 9.00%;
(d) the weighted average original LTV must not exceed 79%, and
no more than 37.00% of the Mortgage Loans may have LTVs in excess of
80%;
(e) each Group I Mortgage Loan must have a Stated Principal
Balance in conformity with the FHLMC guidelines, and no Group II
Mortgage Loan may have a Stated Principal Balance in excess of
$650,000 as of the related Cut-off Date;
(f) at least 80% of the Mortgage Loans must have prepayment
penalties;
(g) the weighted average Gross Margin for the Adjustable Rate
Mortgage Loans must be at least 6.50%; and
(h) the weighted average credit score (FICO score) must be at
least 594, and not more than 22.00% of the Mortgage Loans may have
credit scores below 540.
Any of the above requirements may be waived or modified in any
respect upon prior written confirmation from each Rating Agency that
such waiver or modification will not result in a downgrade or
withdrawal of the initial ratings on the LIBOR Certificates.
(iii) In connection with the transfer and assignment of the
Subsequent Mortgage Loans, the Depositor shall satisfy the document
delivery requirements set forth in Section 2.01(b).
(d) The Depositor does hereby establish, pursuant to the further
provisions of this Agreement and the laws of the State of New York, an express
trust (the "Trust") to be known, for convenience, as "XXXXXX XXXXXXX XXXX XXXXXX
CAPITAL I INC. TRUST 2002-HE1" and U.S. Bank National Association is hereby
appointed as Trustee in accordance with the provisions of this Agreement.
Section 2.02 Acceptance by the Trustee of the Mortgage Loans.
The Trustee shall acknowledge, on each Delivery Date, receipt by it,
or the Custodian shall acknowledge on the Trustee's behalf, on each Delivery
Date, receipt by the Custodian of the documents identified in the Initial
Certification in the form annexed hereto as Exhibit E, and each such party
declares that it holds and will hold such documents and the other documents
delivered to it pursuant to Section 2.01, and that it holds or will hold such
other assets as are included in the Trust Fund, in trust for the exclusive use
and benefit of all present and future Certificateholders. The Trustee
acknowledges that it will maintain possession of the related Mortgage Notes in
the State of Minnesota, unless otherwise permitted by the Rating Agencies.
In connection with each Delivery Date, the Trustee shall, and the
Custodian shall be required to, deliver via facsimile (with original to follow
the next Business Day) to the Depositor an Initial Certification prior to such
Delivery Date, or as the Depositor agrees to, on such Delivery Date, certifying
receipt of a Mortgage Note and Assignment of Mortgage for each Mortgage Loan.
Neither the Trustee nor the Custodian shall be responsible to verify the
validity, sufficiency or genuineness of any document in any Custodial File.
Within 90 days after the related Delivery Date, the Trustee or the
Custodian on behalf of the Trustee, as applicable, shall ascertain that all
documents required to be delivered to such party are in its possession, and
shall deliver to the Depositor a Final Certification to the effect that, as to
each Mortgage Loan listed in the Mortgage Loan Schedule (other than any Mortgage
Loan paid in full or any Mortgage Loan specifically identified in such
certification as an exception and not covered by such certification): (i) all
documents required to be delivered to it are in its possession; (ii) such
documents have been reviewed by it and appear regular on their face and relate
to such Mortgage Loan; (iii) based on its examination and only as to the
foregoing documents, the information set forth in items (1), (2), (7) and (9) of
the Mortgage Loan Schedule and items (1), (9) and (17) of the Data Tape
Information respecting such Mortgage Loan is correct; and (iv) each Mortgage
Note has been endorsed as provided in Section 2.01 of this Agreement. The
Trustee shall not be responsible to verify the validity, sufficiency or
genuineness of any document in any Custodial File.
The Trustee shall retain or cause the Custodian to retain possession
and custody of each Custodial File in accordance with and subject to the terms
and conditions set forth herein. The applicable Servicer shall promptly deliver
to the Trustee or the Custodian, upon the execution or receipt thereof, the
originals of such other documents or instruments constituting the Custodial File
as come into the possession of the applicable Servicer from time to time.
A portion of the Custodial Files are being held by the Custodian.
Notwithstanding anything to the contrary contained herein, the parties hereto
acknowledge that the functions of the Trustee with respect to the custody,
acceptance, inspection and release of such Custodial Files pursuant to Sections
2.01, 2.02 and 3.16 shall be performed by the Custodian.
Section 2.03 Remedies for Breaches of Representations and
Warranties with Respect to the Mortgage Loans.
(a) Ocwen Federal Bank FSB hereby makes the representations and
warranties set forth in Schedule II hereto to the Depositor and the Trustee, as
of the dates set forth in such schedule, and The Provident Bank hereby makes the
representations and warranties set forth in Schedule III hereto to the Depositor
and the Trustee, as of the dates set forth in such schedule.
(b) It is understood and agreed by each Servicer that the
representations and warranties set forth in this Section 2.03 shall survive the
transfer of the Mortgage Loans by the Depositor to the Trustee, and shall inure
to the benefit of the Depositor and the Trustee notwithstanding any restrictive
or qualified endorsement on any Mortgage Note or Assignment of Mortgage or the
examination or failure to examine any Mortgage File.
(c) Upon discovery by any of the parties hereto of a breach of a
representation or warranty made by any Originator under any Purchase Agreement
to which such Originator is a party or the Assignment Agreement to which such
Originator is a party, as applicable, that materially and adversely affects the
interests of the Certificateholders in any Mortgage Loan, the party discovering
such breach shall give prompt written notice thereof to the other parties. A
breach (i) which causes a Mortgage Loan not to constitute a "qualified mortgage"
within the meaning of Section 860G(a)(3) of the Code or (ii) by any Originator
of the representations and warranties set forth in clause (ww) (in the case of
First Franklin and New Century), (ww)(ii) (in the case of Accredited), (xx),
(yy) (in the case of Accredited and New Century), (zz) (in the case of First
Franklin), (vv)(ii) (in the case of First Franklin), or (aaa) (in the case of
Accredited) of Section 9.02 of the applicable Purchase Agreement, will be deemed
automatically to materially and adversely affect the interests of the
Certificateholders in such Mortgage Loan. Upon receiving written notice of a
breach of a representation and warranty or written notice that a Mortgage Loan
does not constitute a "qualified mortgage" within the meaning of Section
860G(a)(3) of the Code, the Trustee shall in turn notify the applicable
Originator in writing to correct or cure, in accordance with the related
Purchase Agreement, any such breach of a representation or warranty made by such
Originator under either the related Purchase Agreement or the related Assignment
Agreement, as applicable, within sixty (60) days from the date of notice from
the Trustee or the discovery by such Originator of the breach, and if such
Originator fails or is unable to correct or cure the defect or breach within
such period, the Trustee shall notify the Depositor of such failure to correct
or cure. Unless otherwise directed by the Depositor within five (5) Business
Days after notifying the Depositor of such failure by the Originator to correct
or cure, the Trustee shall notify such Originator to repurchase the Mortgage
Loan at the Repurchase Price pursuant to the terms of the related Purchase
Agreement. Notwithstanding the foregoing, in the event that the Trustee receives
notice of a breach by an Originator of any of the representations and warranties
set forth in clause (ww) (in the case of First Franklin and New Century),
(ww)(ii) (in the case of Accredited), (xx), (yy) (in the case of Accredited and
New Century), (zz) (in the case of First Franklin), (vv)(ii) (in the case of
First Franklin), or (aaa) (in the case of Accredited) of Section 9.02 of the
applicable Purchase Agreement, the Trustee shall notify such Originator to
repurchase the Mortgage Loan at the Repurchase Price within sixty (60) days of
such Originator's receipt of such notice. If, within ten (10) Business Days of
receipt of such notice by such Originator, such Originator fails to repurchase
such Mortgage Loan, the Trustee shall notify the Depositor of such failure. The
Trustee shall pursue all legal remedies available to the Trustee against such
Originator under the applicable Purchase Agreement if the Trustee has received
written notice from the Depositor directing the Trustee to pursue such remedies.
(d) In the event any Mortgage Loan does not conform to the
requirements as determined in the Trustee's or the Custodian's review of the
related Custodial File, the Trustee shall notify the applicable Originator to
correct or cure such defect as required under the related Purchase Agreement,
and if the applicable Originator fails or is unable to correct or cure the
defect within the period set forth in the related Purchase Agreement, the
Trustee shall notify the Depositor of such failure to correct or cure. Unless
otherwise directed by the Depositor within five (5) Business Days after
notifying the Depositor of such failure by the Originator to correct or cure,
the Trustee shall notify the Originator to repurchase the Mortgage Loan at the
Repurchase Price pursuant to the terms of the related Purchase Agreement. If,
within ten (10) Business Days of receipt of such notice by such Originator, the
Originator fails to repurchase such Mortgage Loan, the Trustee shall notify the
Depositor of such failure. The Trustee shall pursue all legal remedies available
to the Trustee against such Originator under the Purchase Agreement if the
Trustee has received written notice from the Depositor directing the Trustee to
pursue such remedies.
Any Mortgage Loan repurchased pursuant to this Section 2.03 will be
removed from the Trust Fund. The applicable Servicer shall amend the Mortgage
Loan Schedule for the benefit of the Certificateholders to reflect the removal
of any Mortgage Loan repurchased and the applicable Servicer shall deliver the
amended Mortgage Loan Schedule to the Trustee.
In the event that any Originator, pursuant to either the related
Purchase Agreement or the related Assignment Agreement, as applicable, shall
have repurchased a Mortgage Loan, the Repurchase Price therefor shall be
deposited in the Collection Account of the related Servicer pursuant to Section
3.10 on or before the Distribution Account Deposit Date for the Distribution
Date in the month following the month during which such Originator became
obligated to repurchase such Mortgage Loan and upon such deposit of the
Repurchase Price and receipt of a Request for Release in the form of Exhibit J
hereto, the Trustee shall release the related Custodial File held for the
benefit of the Certificateholders to such Person as directed by the applicable
Servicer, and the Trustee shall execute and deliver at such Person's direction
such instruments of transfer or assignment prepared by such Person, in each case
without recourse, as shall be necessary to transfer title from the Trustee.
It is understood and agreed that the obligation of each Originator
under either the related Purchase Agreement or the related Assignment Agreement,
as applicable to cure or repurchase any Mortgage Loan as to which a breach has
occurred and is continuing shall constitute the sole remedy against such Persons
respecting such breach available to Certificateholders, the Depositor or the
Trustee on their behalf.
The provisions of this Section 2.03 shall survive delivery of the
respective Custodial Files to the Trustee or the Custodian for the benefit of
the Certificateholders.
Section 2.04 The Depositor and the Mortgage Loans.
The Depositor hereby represents and warrants to the Trustee with
respect to each Mortgage Loan as of the date hereof or such other date set forth
herein that as of the related Delivery Date, and following the transfer of the
Mortgage Loans to it by the Purchaser, the Depositor had good title to the
Mortgage Loans and the Mortgage Notes were subject to no offsets, defenses or
counterclaims.
The Depositor hereby assigns, transfers and conveys to the Trustee
all of its rights with respect to the Initial Mortgage Loans and shall, on each
Subsequent Transfer Date, convey all of its right, title and interest with
respect to the related Subsequent Mortgage Loans.
Section 2.05 [Reserved.]
Section 2.06 Execution and Delivery of Certificates.
The Trustee acknowledges the transfer and assignment to it of the
Trust Fund and, concurrently with such transfer and assignment, has executed and
delivered to or upon the order of the Depositor, the Certificates in authorized
denominations evidencing directly or indirectly the entire ownership of the
Trust Fund. The Trustee agrees to hold the Trust Fund and exercise the rights
referred to above for the benefit of all present and future Holders of the
Certificates.
Section 2.07 REMIC Matters.
The Preliminary Statement sets forth the designations for federal
income tax purposes of all interests created hereby. The "Startup Day" for
purposes of the REMIC Provisions shall be the Closing Date. The "latest possible
maturity date" is July 25, 2032 which is the Distribution Date following the
latest Mortgage Loan maturity date.
Section 2.08 Representations and Warranties of the Depositor.
The Depositor hereby represents, warrants and covenants to the
Trustee and the Servicers that as of the date of this Agreement or as of such
date specifically provided herein:
(a) The Depositor is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware;
(b) The Depositor has the corporate power and authority to convey
the Mortgage Loans and to execute, deliver and perform, and to enter into and
consummate the transactions contemplated by, this Agreement;
(c) This Agreement has been duly and validly authorized, executed
and delivered by the Depositor, all requisite corporate action having been
taken, and, assuming the due authorization, execution and delivery hereof by the
Servicers and the Trustee, constitutes or will constitute the legal, valid and
binding agreement of the Depositor, enforceable against the Depositor in
accordance with its terms, except as such enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
relating to or affecting the rights of creditors generally, and by general
equity principles (regardless of whether such enforcement is considered in a
proceeding in equity or at law);
(d) No consent, approval, authorization or order of or
registration or filing with, or notice to, any governmental authority or court
is required for the execution, delivery and performance of or compliance by the
Depositor with this Agreement or the consummation by the Depositor of any of the
transactions contemplated hereby, except as have been made on or prior to the
Closing Date;
(e) None of the execution and delivery of this Agreement, the
consummation of the transactions contemplated hereby or thereby, or the
fulfillment of or compliance with the terms and conditions of this Agreement,
(i) conflicts or will conflict with or results or will result in a breach of, or
constitutes or will constitute a default or results or will result in an
acceleration under (A) the charter or bylaws of the Depositor, or (B) of any
term, condition or provision of any material indenture, deed of trust, contract
or other agreement or instrument to which the Depositor or any of its
subsidiaries is a party or by which it or any of its subsidiaries is bound; (ii)
results or will result in a violation of any law, rule, regulation, order,
judgment or decree applicable to the Depositor of any court or governmental
authority having jurisdiction over the Depositor or its subsidiaries; or (iii)
results in the creation or imposition of any lien, charge or encumbrance which
would have a material adverse effect upon the Mortgage Loans or any documents or
instruments evidencing or securing the Mortgage Loans;
(f) There are no actions, suits or proceedings before or against
or investigations of, the Depositor pending, or to the knowledge of the
Depositor, threatened, before any court, administrative agency or other
tribunal, and no notice of any such action, which, in the Depositor's reasonable
judgment, might materially and adversely affect the performance by the Depositor
of its obligations under this Agreement, or the validity or enforceability of
this Agreement;
(g) The Depositor 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 that may materially and adversely affect its
performance hereunder; and
(h) Immediately prior to the transfer and assignment by the
Depositor to the Trustee on the Closing Date, the Depositor had, or, with
respect to the Subsequent Mortgage Loans, will have, good title to, and was, or
will be, the sole owner of, each Mortgage Loan, free of any interest of any
other Person, and the Depositor has transferred, or shall transfer, all right,
title and interest in each Mortgage Loan to the Trustee. The transfer of the
Mortgage Note and the Mortgage as and in the manner contemplated by this
Agreement is sufficient either (i) fully to transfer to the Trustee, for the
benefit of the Certificateholders, all right, title, and interest of the
Depositor thereto as note holder and mortgagee or (ii) to grant to the Trustee,
for the benefit of the Certificateholders, the security interest referred to in
Section 10.04 hereof.
It is understood and agreed that the representations, warranties and
covenants set forth in this Section 2.08 shall survive delivery of the
respective Custodial Files to the Trustee or to the Custodian, as the case may
be, and shall inure to the benefit of the Trustee.
ARTICLE III
ADMINISTRATION AND SERVICING
OF MORTGAGE LOANS
Section 3.01 Servicers to Service Mortgage Loans.
(a) For and on behalf of the Certificateholders, each Servicer
shall service and administer the Mortgage Loans in accordance with the terms of
this Agreement and the respective Mortgage Loans and, to the extent consistent
with such terms, in the same manner in which it services and administers similar
mortgage loans for its own portfolio, giving due consideration to customary and
usual standards of practice of mortgage lenders and loan servicers administering
similar mortgage loans but without regard to:
(i) any relationship that such Servicer, any Subservicer or any
Affiliate of such Servicer or any Subservicer may have with the related
Mortgagor;
(ii) the ownership or non-ownership of any Certificate by such
Servicer or any Affiliate of such Servicer;
(iii) such Servicer's obligation to make P&I Advances or Servicing
Advances; or
(iv) such Servicer's or any Subservicer's right to receive
compensation for its services hereunder or with respect to any particular
transaction.
When the term "Servicer" is used in this Agreement in connection
with the administration of servicing obligations with respect to any Mortgage
Loan, Mortgaged Property, REO Property or Mortgage File, "Servicer" shall mean
(i) Ocwen Federal Bank FSB with respect to the New Century Mortgage Loans and
the First Franklin Mortgage Loans and (ii) The Provident Bank with respect to
the Accredited Mortgage Loans.
To the extent consistent with the foregoing, the Servicer shall seek
to maximize the timely and complete recovery of principal and interest on the
Mortgage Notes. Subject only to the above-described servicing standards and the
terms of this Agreement and of the respective Mortgage Loans, the Servicer shall
have full power and authority, acting alone or through Subservicers as provided
in Section 3.02, to do or cause to be done any and all things in connection with
such servicing and administration which it may deem necessary or desirable.
Without limiting the generality of the foregoing, the Servicer in its own name
or in the name of a Subservicer is hereby authorized and empowered by the
Trustee when the Servicer believes it appropriate in its best judgment in
accordance with the servicing standards set forth above, to execute and deliver
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 the Mortgaged Properties and to institute foreclosure
proceedings or obtain a deed-in-lieu of foreclosure so as to convert the
ownership of such properties, and to hold or cause to be held title to such
properties, on behalf of the Trustee. The Servicer shall service and administer
the Mortgage Loans in accordance with applicable state and federal law and shall
provide to the Mortgagors any reports required to be provided to them thereby.
The Servicer shall also comply in the performance of this Agreement with all
reasonable rules and requirements of each insurer under any standard hazard
insurance policy. Subject to Section 3.15, the Trustee shall execute, at the
written request of the Servicer, and furnish to the Servicer and any Subservicer
such documents as are necessary or appropriate to enable the Servicer or any
Subservicer to carry out their servicing and administrative duties hereunder,
and the Trustee hereby grants to the Servicer, and this Agreement shall
constitute, a power of attorney to carry out such duties including a power of
attorney to take title to Mortgaged Properties after foreclosure on behalf of
the Trustee. The Trustee shall execute a separate power of attorney in favor of
the Servicer for the purposes described herein to the extent necessary or
desirable to enable the Servicer to perform its duties hereunder. The Trustee
shall not be liable for the actions of the Servicer or any Subservicers under
such powers of attorney.
(b) Subject to Section 3.09(b) hereof, in accordance with the
standards of the preceding paragraph, the Servicer shall advance or cause to be
advanced funds as necessary for the purpose of effecting the timely payment of
taxes and assessments on the Mortgaged Properties, which advances shall be
Servicing Advances reimbursable in the first instance from related collections
from the Mortgagors pursuant to Section 3.09(b), and further as provided in
Section 3.11. Any cost incurred by such Servicer or by Subservicers in effecting
the timely payment of taxes and assessments on a Mortgaged Property shall not be
added to the unpaid principal balance of the related Mortgage Loan,
notwithstanding that the terms of such Mortgage Loan so permit.
(c) Notwithstanding anything in this Agreement to the contrary,
the Servicer may not make any future advances with respect to a Mortgage Loan
(except as provided in Section 4.01) and the Servicer shall not (i) permit any
modification with respect to any Mortgage Loan that would change the Mortgage
Rate, reduce or increase the principal balance (except for reductions resulting
from actual payments of principal) or change the final maturity date on such
Mortgage Loan or (ii) permit any modification, waiver or amendment of any term
of any Mortgage Loan that would both (A) effect an exchange or reissuance of
such Mortgage Loan under Section 1001 of the Code (or final, temporary or
proposed Treasury regulations promulgated thereunder) and (B) cause any REMIC to
fail to qualify as a REMIC under the Code or the imposition of any tax on
"prohibited transactions" or "contributions after the startup date" under the
REMIC Provisions, or (iii) except as provided in Section 3.07(a), waive any
Prepayment Charges.
(d) The Servicer may delegate its responsibilities under this
Agreement; provided, however, that no such delegation shall release such
Servicer from the responsibilities or liabilities arising under this Agreement.
Section 3.02 Subservicing Agreements between a Servicer and
Subservicers.
(a) Each Servicer may enter into Subservicing Agreements with
Subservicers, for the servicing and administration of the Mortgage Loans.
Each Subservicer shall be (i) authorized to transact business in the
state or states in which the related Mortgaged Properties it is to service are
situated, if and to the extent required by applicable law to enable the
Subservicer to perform its obligations hereunder and under the Subservicing
Agreement, (ii) an institution approved as a mortgage loan originator by the
Federal Housing Administration or an institution that has deposit accounts
insured by the FDIC and (iii) a Xxxxxxx Mac or Xxxxxx Mae approved mortgage
servicer. Each Subservicing Agreement must impose on the Subservicer
requirements conforming to the provisions set forth in Section 3.08 and provide
for servicing of the Mortgage Loans consistent with the terms of this Agreement.
Each Servicer will examine each Subservicing Agreement and will be familiar with
the terms thereof. The terms of any Subservicing Agreement will not be
inconsistent with any of the provisions of this Agreement. Each Servicer and the
respective Subservicers may enter into and make amendments to the Subservicing
Agreements or enter into different forms of Subservicing Agreements; provided,
however, that any such amendments or different forms shall be consistent with
and not violate the provisions of this Agreement, and that no such amendment or
different form shall be made or entered into which could be reasonably expected
to be materially adverse to the interests of the Trustee, without the consent of
the Trustee. Any variation without the consent of the Trustee from the
provisions set forth in Section 3.08 relating to insurance or priority
requirements of Subservicing Accounts, or credits and charges to the
Subservicing Accounts or the timing and amount of remittances by the
Subservicers to such Servicer, are conclusively deemed to be inconsistent with
this Agreement and therefore prohibited. Each Servicer shall deliver to the
Trustee and the Depositor copies of all Subservicing Agreements, and any
amendments or modifications thereof, promptly upon such Servicer's execution and
delivery of such instruments.
(b) As part of its servicing activities hereunder, each Servicer
(except as otherwise provided in the last sentence of this paragraph), for the
benefit of the Trustee, shall enforce the obligations of each Subservicer under
the related Subservicing Agreement to which such Servicer is a party, including,
without limitation, any obligation to make advances in respect of delinquent
payments as required by a Subservicing Agreement. Such enforcement, including,
without limitation, the legal prosecution of claims, termination of Subservicing
Agreements, and the pursuit of other appropriate remedies, shall be in such form
and carried out to such an extent and at such time as such Servicer, in its good
faith business judgment, would require were it the owner of the related Mortgage
Loans. Each Servicer shall pay the costs of such enforcement at its own expense,
and shall be reimbursed therefor only (i) from a general recovery resulting from
such enforcement, 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 3.03 Successor Subservicers.
Each Servicer shall be entitled to terminate any Subservicing
Agreement to which such Servicer is a party and the rights and obligations of
any Subservicer pursuant to any Subservicing Agreement in accordance with the
terms and conditions of such Subservicing Agreement. In the event of termination
of any Subservicer, all servicing obligations of such Subservicer shall be
assumed simultaneously by the Servicer party to the related Subservicing
Agreement without any act or deed on the part of such Subservicer or such
Servicer, and such Servicer either shall service directly the related Mortgage
Loans or shall enter into a Subservicing Agreement with a successor Subservicer
which qualifies under Section 3.02.
Any Subservicing Agreement shall include the provision that such
agreement may be immediately terminated by the Depositor or the Trustee without
fee, in accordance with the terms of this Agreement, in the event that the
Servicer party to the related Subservicing Agreement shall, for any reason, no
longer be a Servicer (including termination due to an Event of Default).
Section 3.04 Liability of the Servicers.
Notwithstanding any Subservicing Agreement, any of the provisions of
this Agreement relating to agreements or arrangements between a Servicer and a
Subservicer or reference to actions taken through a Subservicer or otherwise,
such Servicer shall remain obligated and primarily liable to the Trustee for the
servicing and administering of the Mortgage Loans in accordance with the
provisions of Section 3.01 without diminution of such obligation or liability by
virtue of such Subservicing Agreements or arrangements or by virtue of
indemnification from the Subservicer and to the same extent and under the same
terms and conditions as if such Servicer alone were servicing and administering
such Mortgage Loans. Each Servicer shall be entitled to enter into any agreement
with a Subservicer for indemnification of such Servicer by such Subservicer and
nothing contained in this Agreement shall be deemed to limit or modify such
indemnification.
Section 3.05 No Contractual Relationship between Subservicers
and the Trustee.
Any Subservicing Agreement that may be entered into and any
transactions or services relating to the Mortgage Loans involving a Subservicer
in its capacity as such shall be deemed to be between the Subservicer and the
related Servicer alone, and the Trustee (or any successor to such Servicer)
shall not be deemed a party thereto and shall have no claims, rights,
obligations, duties or liabilities with respect to the Subservicer except as set
forth in Section 3.06. Each Servicer shall be solely liable for all fees owed by
it to any Subservicer, irrespective of whether such Servicer's compensation
pursuant to this Agreement is sufficient to pay such fees.
Section 3.06 Assumption or Termination of Subservicing
Agreements by Trustee.
In the event a Servicer at any time shall for any reason no longer
be a Servicer (including by reason of the occurrence of an Event of Default),
the Trustee or its designee shall thereupon assume all of the rights and
obligations of such Servicer under each Subservicing Agreement that such
Servicer may have entered into, with copies thereof provided to the Trustee
prior to the Trustee assuming such rights and obligations, unless the Trustee
elects to terminate any Subservicing Agreement in accordance with its terms as
provided in Section 3.03.
Upon such assumption, the Trustee, its designee or the successor
servicer shall be deemed, subject to Section 3.03, to have assumed all of such
Servicer's interest therein and to have replaced such Servicer as a party to
each Subservicing Agreement to the same extent as if each Subservicing Agreement
had been assigned to the assuming party, except that (i) such Servicer shall not
thereby be relieved of any liability or obligations under any Subservicing
Agreement that arose before it ceased to be a Servicer and (ii) none of the
Depositor, the Trustee, their designees or any successor to such Servicer shall
be deemed to have assumed any liability or obligation of such Servicer that
arose before it ceased to be a Servicer.
Such Servicer at its expense shall, upon request of the Trustee,
deliver to the assuming party all documents and records relating to each
Subservicing Agreement and the Mortgage Loans then being serviced by it and an
accounting of amounts collected and held by or on behalf of it, and otherwise
use its best efforts to effect the orderly and efficient transfer of the
Subservicing Agreements to the assuming party.
Section 3.07 Collection of Certain Mortgage Loan Payments.
(a) The Servicer shall make reasonable efforts to collect all
payments called for under the terms and provisions of the Mortgage Loans, and
shall, to the extent such procedures shall be consistent with this Agreement and
the terms and provisions of any applicable insurance policies, follow such
collection procedures as it would follow with respect to mortgage loans
comparable to the Mortgage Loans and held for its own account. Consistent with
the foregoing, the Servicer may (i) waive any late payment charge or, if
applicable, any penalty interest, or (ii) extend the due dates for the Scheduled
Payments due on a Mortgage Note for a period of not greater than 180 days;
provided that any extension pursuant to clause (ii) above shall not affect the
amortization schedule of any Mortgage Loan for purposes of any computation
hereunder, except as provided below. In the event of any such arrangement
pursuant to clause (ii) above, the Servicer shall make timely advances on such
Mortgage Loan during such extension pursuant to Section 4.01 and in accordance
with the amortization schedule of such Mortgage Loan without modification
thereof by reason of such arrangements, subject to Section 4.01(d) pursuant to
which the Servicer shall not be required to make any such advances that are
Nonrecoverable P&I Advances. Notwithstanding the foregoing, the Servicer may
waive, in whole or in part, a Prepayment Charge only under the following
circumstances: (i) such waiver relates to a default or a reasonably foreseeable
default and would, in the reasonable judgment of the Servicer, maximize recovery
of total proceeds taking into account the value of such Prepayment Charge and
the related Mortgage Loan or (ii) such Prepayment Charge is not permitted to be
collected by applicable law. If a Prepayment Charge is waived other than as
permitted by the prior sentence, then the Servicer is required to pay the amount
of such waived Prepayment Charge, for the benefit of the Holders of the Class P
Certificates, by depositing such amount into the Collection Account together
with and at the time that the amount prepaid on the related Mortgage Loan is
required to be deposited into such Collection Account; provided, however, that
the Servicer shall not have an obligation to pay the amount of any uncollected
Prepayment Charge if the failure to collect such amount is the direct result of
inaccurate or incomplete information on the Mortgage Loan Schedule in effect at
such time.
(b) (i) The Trustee shall establish and maintain the Excess
Reserve Fund Account, on behalf of the Class X Certificateholders, to secure
their limited recourse obligation to pay to the LIBOR Certificateholders Basis
Risk CarryForward Amounts.
(ii) On each Distribution Date, the Trustee shall deposit the amount
of any Basis Risk Payment for such date into the Excess Reserve Fund
Account.
(c) (i) On each Distribution Date on which there exists a Basis
Risk CarryForward Amount on any Class of Certificates, the Trustee shall (1)
withdraw from the Distribution Account and deposit in the Excess Reserve Fund
Account, as set forth in Section 4.02(a)(iii)(g), the lesser of the Class X
Distributable Amount (without regard to the reduction in the definition thereof
with respect to the Basis Risk CarryForward Amount) (to the extent remaining
after the distributions specified in Sections 4.02(a)(iii)(a)-(f)) and the Basis
Risk CarryForward Amount and (2) withdraw from the Excess Reserve Fund Account
amounts necessary to pay to such Class or Classes of Certificates the Basis Risk
CarryForward Amount. Such payments shall be allocated to those Classes on a pro
rata basis based upon the amount of Basis Risk CarryForward Amount owed to each
such Class and shall be paid in the priority set forth in Section
4.02(a)(iii)(h) hereof.
(ii) The Trustee shall account for the Excess Reserve Fund Account
as an outside reserve fund within the meaning of Treasury Regulations
Section 1.860G-2(h) and not an asset of any REMIC created pursuant to this
Agreement. The beneficial owner of the Excess Reserve Fund Account is the
Class X Certificateholder. For all federal tax purposes, amounts
transferred by the Upper Tier REMIC to the Excess Reserve Fund Account
shall be treated as distributions by the Trustee to the Class X
Certificateholder.
(iii) Any Basis Risk CarryForward Amounts paid by the Trustee to the
LIBOR Certificateholders shall be accounted for by the Trustee as amounts
paid first to the Holders of the Class X Certificate and then to the
respective Class or Classes of LIBOR Certificates. In addition, the
Trustee shall account for the LIBOR Certificateholders' rights to receive
payments of Basis Risk CarryForward Amounts as rights in a limited
recourse interest rate cap contract written by the Class X
Certificateholders in favor of the LIBOR Certificateholders.
(iv) Notwithstanding any provision contained in this Agreement, the
Trustee shall not be required to make any payments from the Excess Reserve
Fund Account except as expressly set forth in this Section 3.07(c).
(d) The Trustee shall establish and maintain the Distribution
Account on behalf of the Certificateholders. The Trustee shall, promptly upon
receipt, deposit in the Distribution Account and retain therein the following:
(i) the aggregate amount remitted by the Servicers to the Trustee
pursuant to Section 3.11;
(ii) any amount deposited by the Servicers pursuant to Section
3.12(b)(i) in connection with any losses on Permitted Investments; and
(iii) any other amounts deposited hereunder which are required to be
deposited in the Distribution Account.
In the event that a Servicer shall remit any amount not required to
be remitted, it may at any time direct the Trustee in writing to withdraw such
amount from the Distribution Account, any provision herein to the contrary
notwithstanding. Such direction may be accomplished by delivering notice to the
Trustee which describes the amounts deposited in error in the Distribution
Account. All funds deposited in the Distribution Account shall be held by the
Trustee in trust for the Certificateholders until disbursed in accordance with
this Agreement or withdrawn in accordance with Section 4.02.
(e) The Trustee shall establish and maintain the Capitalized
Interest Account on behalf of the Certificateholders. On the Closing Date, the
Trustee shall deposit $124,846.84 into the Capitalized Interest Account from the
proceeds of the sale of the Offered Certificates. Withdrawals from the
Capitalized Interest Account shall be made in accordance with Section 4.02(c)
and (d) hereof. The Trustee shall account for the Capitalized Interest Account
as an outside reserve fund within the meaning of Treasury Regulation 1.860G-2(h)
and not as an asset of any REMIC created pursuant to this Agreement. The
beneficial owner of the Capitalized Interest Account shall be the Purchaser, who
shall be taxable on all income or gain with respect thereto.
(f) The Trustee shall establish and maintain each of the Group I
Pre-Funding Account and the Group II Pre-Funding Account, in each case on behalf
of the Certificateholders. On the Closing Date, the Trustee shall deposit the
Original Group I Pre-Funded Amount into the Group I Pre-Funding Account and the
Original Group II Pre-Funded Amount into the Group II Pre-Funding Account, in
each case, from the proceeds of the sale of the Offered Certificates.
Withdrawals from the Pre-Funding Accounts shall be made in accordance with
Sections 4.02(e), (f) and (g) hereof.
(g) At the direction of the Purchaser the Trustee may invest the
funds in the related Pre-Funding Accounts and the Capitalized Interest Account
in each case, in Permitted Investments, which directions shall be in accordance
with Section 3.12.
The Trustee may withdraw from the Distribution Account any income or
gain earned from the investment of funds deposited therein for its own benefit.
(h) Each Servicer shall give notice to the Trustee, each Rating
Agency and the Depositor of any proposed change of the location of the related
Collection Account prior to any change thereof.
Section 3.08 Subservicing Accounts.
In those cases where a Subservicer is servicing a Mortgage Loan
pursuant to a Subservicing Agreement, the Subservicer will be required to
establish and maintain one or more accounts (collectively, the "Subservicing
Account"). The Subservicing Account shall be an Eligible Account and shall
otherwise be acceptable to the related Servicer. The Subservicer shall deposit
in the clearing account (which account must be an Eligible Account) in which it
customarily deposits payments and collections on mortgage loans in connection
with its mortgage loan servicing activities on a daily basis, and in no event
more than one Business Day after the Subservicer's receipt thereof, all proceeds
of Mortgage Loans received by the Subservicer less its servicing compensation to
the extent permitted by the Subservicing Agreement, and shall thereafter deposit
such amounts in the Subservicing Account, in no event more than two Business
Days after the deposit of such funds into the clearing account. The Subservicer
shall thereafter deposit such proceeds in the Collection Account of the related
Servicer or remit such proceeds to the related Servicer for deposit in the
Collection Account of the related Servicer not later than two Business Days
after the deposit of such amounts in the Subservicing Account. For purposes of
this Agreement, such Servicer shall be deemed to have received payments on the
Mortgage Loans when the Subservicer receives such payments.
Section 3.09 Collection of Taxes, Assessments and Similar
Items; Escrow Accounts.
(a) The Servicer shall enforce the obligations under each
paid-in-full, life-of-the-loan tax service contract in effect with respect to
each Mortgage Loan (each, a "Tax Service Contract").
(b) To the extent that the services described in this paragraph
(b) are not otherwise provided pursuant to the Tax Service Contracts described
in paragraph (a) hereof, the Servicer undertakes to perform such functions. The
Servicer shall establish and maintain, or cause to be established and
maintained, one or more accounts (the "Escrow Accounts"), which shall be
Eligible Accounts. The Servicer shall deposit in the clearing account (which
account must be an Eligible Account) in which it customarily deposits payments
and collections on mortgage loans in connection with its mortgage loan servicing
activities on a daily basis, and in no event more than one Business Day after
the Servicer's receipt thereof, all collections from the Mortgagors (or related
advances from Subservicers) for the payment of taxes, assessments, hazard
insurance premiums and comparable items for the account of the Mortgagors
("Escrow Payments") collected on account of the Mortgage Loans and shall
thereafter deposit such Escrow Payments in the Escrow Accounts, in no event more
than two Business Days after the deposit of such funds in the clearing account,
for the purpose of effecting the payment of any such items as required under the
terms of this Agreement. Withdrawals of amounts from an Escrow Account may be
made only to (i) effect payment of taxes, assessments, hazard insurance
premiums, and comparable items; (ii) reimburse the Servicer (or a Subservicer to
the extent provided in the related Subservicing Agreement) out of related
collections for any advances made pursuant to Section 3.01 (with respect to
taxes and assessments) and Section 3.13 (with respect to hazard insurance);
(iii) refund to Mortgagors any sums as may be determined to be overages; (iv)
pay interest, if required and as described below, to Mortgagors on balances in
the Escrow Account; (v) clear and terminate the Escrow Account at the
termination of the Servicer's obligations and responsibilities in respect of the
Mortgage Loans under this Agreement or (vi) recover amounts deposited in error.
As part of its servicing duties, the Servicer or Subservicers shall pay to the
Mortgagors interest on funds in Escrow Accounts, to the extent required by law
and, to the extent that interest earned on funds in the Escrow Accounts is
insufficient, to pay such interest from its or their own funds, without any
reimbursement therefor. To the extent that a Mortgage does not provide for
Escrow Payments, the Servicer shall determine whether any such payments are made
by the Mortgagor in a manner and at a time that avoids the loss of the Mortgaged
Property due to a tax sale or the foreclosure of a tax lien. The Servicer
assumes full responsibility for the payment of all such bills within such time
and shall effect payments of all such bills irrespective of the Mortgagor's
faithful performance in the payment of same or the making of the Escrow Payments
and shall make advances from its own funds to effect such payments; provided,
however, that such advances are deemed to be Servicing Advances.
Section 3.10 Collection Accounts.
(a) On behalf of the Trustee, each Servicer shall establish and
maintain, or cause to be established and maintained, one or more Eligible
Accounts (each such account or accounts, a "Collection Account"), held in trust
for the benefit of the Trustee. On behalf of the Trustee, each Servicer shall
deposit or cause to be deposited in the clearing account (which account must be
an Eligible Account) in which it customarily deposits payments and collections
on mortgage loans in connection with its mortgage loan servicing activities on a
daily basis, and in no event more than one Business Day after such Servicer's
receipt thereof, and shall thereafter deposit in the related Collection Account,
in no event more than two Business Days after the deposit of such funds into the
clearing account, as and when received or as otherwise required hereunder, the
following payments and collections received or made by it subsequent to the
related Cut-off Date (other than in respect of principal or interest on the
related Mortgage Loans due on or before the related Cut-off Date), or payments
(other than Principal Prepayments) received by it on or prior to the related
Cut-off Date but allocable to a Due Period subsequent thereto:
(i) all payments on account of principal, including Principal
Prepayments, on the Mortgage Loans;
(ii) all payments on account of interest (net of the related
Servicing Fee) on each Mortgage Loan;
(iii) all Insurance Proceeds to the extent such Insurance Proceeds
are not to be applied to the restoration of the related Mortgaged Property
or released to the related Mortgagor in accordance with the express
requirements of law or in accordance with prudent and customary servicing
practices and Liquidation Proceeds;
(iv) any amounts required to be deposited pursuant to Section 3.12
in connection with any losses realized on Permitted Investments with
respect to funds held in the related Collection Account;
(v) any amounts required to be deposited by such Servicer pursuant
to the second paragraph of Section 3.13(a) in respect of any blanket
policy deductibles;
(vi) all proceeds of any Mortgage Loan repurchased or purchased in
accordance with this Agreement; and
(vii) all Prepayment Charges collected by such Servicer.
The foregoing requirements for deposit in the Collection Accounts
shall be exclusive, it being understood and agreed that, without limiting the
generality of the foregoing, payments in the nature of late payment charges, NSF
fees, reconveyance fees, assumption fees and other similar fees and charges need
not be deposited by each Servicer in the related Collection Account and shall,
upon collection, belong to the applicable Servicer as additional compensation
for its servicing activities. In the event a Servicer shall deposit in the
related Collection Account any amount not required to be deposited therein, it
may at any time withdraw such amount from its Collection Account, any provision
herein to the contrary notwithstanding.
(b) Funds in the Collection Accounts may be invested in Permitted
Investments in accordance with the provisions set forth in Section 3.12. Each
Servicer shall give notice to the Trustee and the Depositor of the location of
the related Collection Account maintained by it when established and prior to
any change thereof.
Section 3.11 Withdrawals from the Collection Accounts.
(a) Each Servicer shall, from time to time, make withdrawals from
the related Collection Account for any of the following purposes or as described
in Section 4.01:
(i) on or prior to the Remittance Date, to remit to the Trustee (i)
the Trustee Fee with respect to such Distribution Date and (ii) all
Available Funds in respect of the related Distribution Date together with
all amounts representing Prepayment Charges from the Mortgage Loans
received during the related Prepayment Period;
(ii) to reimburse such Servicer for P&I Advances, but only to the
extent of amounts received which represent Late Collections (net of the
related Servicing Fees) of Monthly Payments on Mortgage Loans with respect
to which such P&I Advances were made in accordance with the provisions of
Section 4.01;
(iii) to pay such Servicer or any Subservicer (a) any unpaid
Servicing Fees or (b) any unreimbursed Servicing Advances with respect to
each Mortgage Loan, but only to the extent of any Late Collections,
Liquidation Proceeds, Insurance Proceeds or other amounts as may be
collected by such Servicer from a Mortgagor, or otherwise received with
respect to such Mortgage Loan (or the related REO Property);
(iv) to pay to such Servicer as servicing compensation (in addition
to the Servicing Fee) on the Remittance Date any interest or investment
income earned on funds deposited in its Collection Account;
(v) to pay to an Originator or such Servicer, as applicable, with
respect to each Mortgage Loan that has previously been repurchased
pursuant to the applicable Purchase Agreement or this Agreement,
respectively, all amounts received thereon subsequent to the date of
purchase;
(vi) to reimburse such Servicer for any P&I Advance or Servicing
Advance previously made which such Servicer has determined to be a
Nonrecoverable P&I Advance or Nonrecoverable Servicing Advance in
accordance with the provisions of Section 4.01;
(vii) to pay, or to reimburse such Servicer for advances in respect
of, expenses incurred in connection with any Mortgage Loan pursuant to
Section 3.15;
(viii) to reimburse such Servicer or the Depositor for expenses
incurred by or reimbursable to such Servicer or the Depositor, as the case
may be, pursuant to Section 6.03;
(ix) to reimburse such Servicer or the Trustee, as the case may be,
for expenses reasonably incurred in respect of the breach or defect giving
rise to the repurchase obligation of an Originator that were included in
the Repurchase Price of the Mortgage Loan, including any expenses arising
out of the enforcement of the repurchase obligation, to the extent not
otherwise paid pursuant to the terms hereof;
(x) to withdraw any amounts deposited in the related Collection
Account in error;
(xi) to withdraw any amounts held in the related Collection Account
and not required to be remitted to the Trustee on the Remittance Date
occurring in the month in which such amounts are deposited into such
Collection Account, to reimburse such Servicer for xxxxxxxxxxxx X&X
Advances; and
(xii) to clear and terminate the related Collection Account upon
termination of this Agreement;
(b) Each Servicer shall keep and maintain separate accounting, on
a Mortgage Loan by Mortgage Loan basis, for the purpose of justifying any
withdrawal from its Collection Account, to the extent held by or on behalf of
it, pursuant to subclauses (a)(ii), (iii), (v), (vi), (vii), (viii) and (ix)
above. Each Servicer shall provide written notification to the Depositor, on or
prior to the next succeeding Remittance Date, upon making any withdrawals from
the related Collection Account pursuant to subclause (a)(vii) above.
Section 3.12 Investment of Funds in the Accounts.
(a) Each Servicer may invest the funds in the related Collection
Account, the Trustee may invest funds in the Distribution Account and the
Purchaser may direct the Trustee to invest the funds in any of the Pre-Funding
Accounts or the Capitalized Interest Account (for purposes of this Section 3.12,
such Accounts are referred to as an "Investment Account"), in one or more
Permitted Investments bearing interest or sold at a discount, and maturing,
unless payable on demand no later than the Business Day immediately preceding
the date on which such funds are required to be withdrawn from such account
pursuant to this Agreement. All such Permitted Investments shall be held to
maturity, unless payable on demand. Any investment of funds in an Investment
Account shall be made in the name of the Trustee. The Trustee shall be entitled
to sole possession (except with respect to investment direction of funds held in
the related Account and any income and gain realized thereon) over each such
investment, and any certificate or other instrument evidencing any such
investment shall be delivered directly to the Trustee or its agent, together
with any document of transfer necessary to transfer title to such investment to
the Trustee. In the event amounts on deposit in an Investment Account are at any
time invested in a Permitted Investment payable on demand, the Trustee may:
(x) consistent with any notice required to be given thereunder,
demand that payment thereon be made on the last day such
Permitted Investment may otherwise mature hereunder in an
amount equal to the lesser of (1) all amounts then payable
thereunder and (2) the amount required to be withdrawn on such
date; and
(y) demand payment of all amounts due thereunder that such
Permitted Investment would not constitute a Permitted
Investment in respect of funds thereafter on deposit in the
Investment Account.
(b) (i) All income and gain realized from the investment of funds
deposited in the related Collection Account held by or on behalf of the related
Servicer, shall be for the benefit of such Servicer and shall be subject to its
withdrawal in the manner set forth in Section 3.11. Such Servicer shall deposit
in its Collection Account, the amount of any loss of principal incurred in
respect of any such Permitted Investment made with funds in such accounts
immediately upon realization of such loss.
(ii) All income and gain realized from the investment of funds
deposited in the Pre-Funding Accounts and the Capitalized Interest Account
held by or on behalf of the Purchaser shall be retained in such Investment
Account, subject to withdrawal as provided in Section 4.02. Whether in
regard to a Pre-Funding Account or the Capitalized Interest Account, the
Depositor shall cause the Purchaser to deposit in such Pre-Funding Account
or the Capitalized Interest Account, as applicable, the amount of any loss
of principal incurred in respect of any such Permitted Investment made
with funds in such accounts immediately upon realization of such loss.
(c) All income and gain realized from the investment of funds
deposited in the Distribution Account held by the Trustee, shall be for the
benefit of the Trustee and shall be subject to its withdrawal in the manner set
forth in Section 3.07(e). The Trustee shall deposit in the Distribution Account,
the amount of any loss of principal incurred in respect of any such Permitted
Investment made with funds in such accounts immediately upon realization of such
loss.
(d) Except as otherwise expressly provided in this Agreement, if
any default occurs in the making of a payment due under any Permitted
Investment, or if a default occurs in any other performance required under any
Permitted Investment, the Trustee shall take such action as may be appropriate
to enforce such payment or performance, including the institution and
prosecution of appropriate proceedings. The Trustee shall not be liable for the
amount of any loss incurred in respect of any investment or lack of investment
of funds held in any Investment Account or the Distribution Account if made in
accordance with this Section 3.12.
Section 3.13 Maintenance of Hazard Insurance and Errors and
Omissions and Fidelity Coverage.
(a) Each Servicer shall cause to be maintained for each Mortgage
Loan fire insurance with extended coverage on the related Mortgaged Property in
an amount which is at least equal to the least of (i) the current principal
balance of such Mortgage Loan, (ii) the amount necessary to fully compensate for
any damage or loss to the improvements that are a part of such property on a
replacement cost basis and (iii) the maximum insurable value of the improvements
which are a part of such Mortgaged Property, in each case in an amount not less
than such amount as is necessary to avoid the application of any coinsurance
clause contained in the related hazard insurance policy. The Servicer shall also
cause to be maintained fire insurance with extended coverage on each REO
Property in an amount which is at least equal to the lesser of (i) the maximum
insurable value of the improvements which are a part of such property and (ii)
the outstanding principal balance of the related Mortgage Loan at the time it
became an REO Property, plus accrued interest at the Mortgage Rate and related
Servicing Advances. The Servicer will comply in the performance of this
Agreement with all reasonable rules and requirements of each insurer under any
such hazard policies. Any amounts to be collected by the Servicer under any such
policies (other than amounts to be applied to the restoration or repair of the
property subject to the related Mortgage or amounts to be released to the
Mortgagor in accordance with the procedures that the Servicer would follow in
servicing loans held for its own account, subject to the terms and conditions of
the related Mortgage and Mortgage Note) shall be deposited in the Collection
Account, subject to withdrawal pursuant to Section 3.11. Any cost incurred by
the Servicer in maintaining any such insurance shall not, for the purpose of
calculating distributions to the Trustee, be added to the unpaid principal
balance of the related Mortgage Loan, notwithstanding that the terms of such
Mortgage Loan so permit. It is understood and agreed that no earthquake or other
additional insurance is to be required of any Mortgagor other than pursuant to
such applicable laws and regulations as shall at any time be in force and as
shall require such additional insurance. If the Mortgaged Property or REO
Property is at any time in an area identified in the Federal Register by the
Federal Emergency Management Agency as having special flood hazards and flood
insurance has been made available, the Servicer will cause to be maintained a
flood insurance policy in respect thereof. Such flood insurance shall be in an
amount equal to the lesser of (i) the unpaid principal balance of the related
Mortgage Loan and (ii) the maximum amount of such insurance available for the
related Mortgaged Property under the national flood insurance program (assuming
that the area in which such Mortgaged Property is located is participating in
such program).
In the event that the Servicer shall obtain and maintain a blanket
policy with an insurer having a General Policy Rating of A:X or better in Best's
(or such other rating that is comparable to such rating) insuring against hazard
losses on all of the Mortgage Loans, it shall conclusively be deemed to have
satisfied its obligations as set forth in the first two sentences of this
Section 3.13, it being understood and agreed that such policy may contain a
deductible clause, in which case the Servicer shall, in the event that there
shall not have been maintained on the related Mortgaged Property or REO Property
a policy complying with the first two sentences of this Section 3.13, and there
shall have been one or more losses which would have been covered by such policy,
deposit to the related Collection Account from its own funds the amount not
otherwise payable under the blanket policy because of such deductible clause. In
connection with its activities as administrator and servicer of the Mortgage
Loans, the Servicer agrees to prepare and present, on behalf of itself, the
Trustee claims under any such blanket policy in a timely fashion in accordance
with the terms of such policy.
(b) The Servicer shall keep in force during the term of this
Agreement a policy or policies of insurance covering errors and omissions for
failure in the performance of the Servicer's obligations under this Agreement,
which policy or policies shall be in such form and amount that would meet the
requirements of Xxxxxx Xxx or Xxxxxxx Mac if it were the purchaser of the
Mortgage Loans, unless the Servicer has obtained a waiver of such requirements
from Xxxxxx Mae or Xxxxxxx Mac. The Servicer shall also maintain a fidelity bond
in the form and amount that would meet the requirements of Xxxxxx Mae or Xxxxxxx
Mac, unless the Servicer has obtained a waiver of such requirements from Xxxxxx
Mae or Xxxxxxx Mac. The Servicer shall provide the Trustee with copies of any
such insurance policies and fidelity bond. The Servicer shall be deemed to have
complied with this provision if an Affiliate of the Servicer has such errors and
omissions and fidelity bond coverage and, by the terms of such insurance policy
or fidelity bond, the coverage afforded thereunder extends to the Servicer. Any
such errors and omissions policy and fidelity bond shall by its terms not be
cancelable without thirty days' prior written notice to the Trustee. The
Servicer shall also cause each Subservicer to maintain a policy of insurance
covering errors and omissions and a fidelity bond which would meet such
requirements.
Section 3.14 Enforcement of Due-On-Sale Clauses Assumption
Agreements.
The Servicer will, to the extent it has knowledge of any conveyance
or prospective conveyance of any Mortgaged Property by any Mortgagor (whether by
absolute conveyance or by contract of sale, and whether or not the Mortgagor
remains or is to remain liable under the Mortgage Note and/or the Mortgage),
exercise its rights to accelerate the maturity of such Mortgage Loan under the
"due-on-sale" clause, if any, applicable thereto; provided, however, that the
Servicer shall not be required to take such action if, in its sole business
judgment, the Servicer believes it is not in the best interests of the Trust
Fund and shall not exercise any such rights if prohibited by law from doing so.
If the Servicer reasonably believes it is unable under applicable law to enforce
such "due-on-sale" clause or if any of the other conditions set forth in the
proviso to the preceding sentence apply, the Servicer will enter into an
assumption and modification agreement from or with the person to whom such
property has been conveyed or is proposed to be conveyed, pursuant to which such
person becomes liable under the Mortgage Note and, to the extent permitted by
applicable state law, the Mortgagor remains liable thereon. The Servicer is also
authorized to enter into a substitution of liability agreement with such person,
pursuant to which the original Mortgagor is released from liability and such
person is substituted as the Mortgagor and becomes liable under the Mortgage
Note, provided that no such substitution shall be effective unless such person
satisfies the underwriting criteria of the Servicer, has a credit risk rating at
least equal to that of the original Mortgagor. In connection with any
assumption, modification or substitution, the Servicer shall apply such
underwriting standards and follow such practices and procedures as shall be
normal and usual in its general mortgage servicing activities and as it applies
to other mortgage loans owned solely by it. The Servicer shall not take or enter
into any assumption and modification agreement, however, unless (to the extent
practicable in the circumstances) it shall have received confirmation, in
writing, of the continued effectiveness of any applicable hazard insurance
policy, or a new policy meeting the requirements of this Section is obtained.
Any fee collected by the Servicer in respect of an assumption or substitution of
liability agreement will be retained by the Servicer as additional servicing
compensation. In connection with any such assumption, no material term of the
Mortgage Note (including but not limited to the related Mortgage Rate and the
amount of the Scheduled Payment) may be amended or modified, except as otherwise
required pursuant to the terms thereof. The Servicer shall notify the Trustee
that any such substitution, modification or assumption agreement has been
completed by forwarding to the Trustee the executed original of such
substitution or assumption agreement, which document shall be added to the
related Mortgage File and shall, for all purposes, be considered a part of such
Mortgage File to the same extent as all other documents and instruments
constituting a part thereof.
Notwithstanding the foregoing paragraph or any other provision of
this Agreement, the Servicer shall not be deemed to be in default, breach or any
other violation of its obligations hereunder by reason of any assumption of a
Mortgage Loan by operation of law or by the terms of the Mortgage Note or any
assumption which the Servicer may be restricted by law from preventing, for any
reason whatever. For purposes of this Section 3.14, the term "assumption" is
deemed to also include a sale (of the Mortgaged Property) subject to the
Mortgage that is not accompanied by an assumption or substitution of liability
agreement.
Section 3.15 Realization upon Defaulted Mortgage Loans.
The Servicer shall use its best efforts, consistent with customary
servicing practices as described in Section 3.01, to foreclose upon or otherwise
comparably convert (which may include an acquisition of REO Property) the
ownership of properties securing such of the Mortgage Loans as come into and
continue in default and as to which no satisfactory arrangements can be made for
collection of delinquent payments pursuant to Section 3.07, and which are not
released from this Agreement pursuant to any other provision hereof. The
Servicer shall use reasonable efforts to realize upon such defaulted Mortgage
Loans in such manner as will maximize the receipt of principal and interest by
the Trustee, taking into account, among other things, the timing of foreclosure
proceedings. The foregoing is subject to the provisions that, in any case in
which Mortgaged Property shall have suffered damage from an uninsured cause, the
Servicer shall not be required to expend its own funds toward the restoration of
such property unless it shall determine in its sole discretion (i) that such
restoration will increase the net proceeds of liquidation of the related
Mortgage Loan to the Trustee, after reimbursement to itself for such expenses,
and (ii) that such expenses will be recoverable by the Servicer through
Insurance Proceeds or Liquidation Proceeds from the related Mortgaged Property,
as contemplated in Section 3.11. The Servicer shall be responsible for all other
costs and expenses incurred by it in any such proceedings; provided, however,
that it shall be entitled to reimbursement thereof from the related property, as
contemplated in Section 3.11.
The proceeds of any liquidation or REO Disposition, as well as any
recovery resulting from a partial collection of Insurance Proceeds or
Liquidation Proceeds or any income from an REO Property, will be applied in the
following order of priority: first, to reimburse the Servicer or any Subservicer
for any related unreimbursed Servicing Advances, pursuant to Section 3.11 or
3.17; second, to accrued and unpaid interest on the Mortgage Loan or REO Imputed
Interest, at the Mortgage Rate, to the date of the liquidation or REO
Disposition, or to the Due Date prior to the Remittance Date on which such
amounts are to be distributed if not in connection with a liquidation or REO
Disposition; third, to reimburse the Servicer for any related xxxxxxxxxxxx X&X
Advances, pursuant to Section 3.11; and fourth, as a recovery of principal of
the Mortgage Loan. If the amount of the recovery so allocated to interest is
less than a full recovery thereof, that amount will be allocated as follows:
first, to unpaid Servicing Fees; and second, as interest at the Mortgage Rate
(net of the Servicing Fee Rate). The portion of the recovery so allocated to
unpaid Servicing Fees shall be reimbursed to the Servicer or any Subservicer
pursuant to Section 3.11 or 3.17. The portions of the recovery so allocated to
interest at the Mortgage Rate (net of the Servicing Fee Rate) and to principal
of the Mortgage Loan shall be applied as follows: first, to reimburse the
Servicer or any Subservicer for any related unreimbursed Servicing Advances in
accordance with Section 3.11 or 3.17, and second, to the Trustee in accordance
with the provisions of Section 4.02, subject to the last paragraph of Section
3.17 with respect to certain excess recoveries from an REO Disposition.
Notwithstanding anything to the contrary contained herein, in
connection with a foreclosure or acceptance of a deed in lieu of foreclosure, in
the event the Servicer has received actual notice of, or has actual knowledge of
the presence of, hazardous or toxic substances or wastes on the related
Mortgaged Property, or if the Trustee otherwise requests, the Servicer shall
cause an environmental inspection or review of such Mortgaged Property to be
conducted by a qualified inspector. Upon completion of the inspection, the
Servicer shall promptly provide the Trustee with a written report of the
environmental inspection.
After reviewing the environmental inspection report, the Depositor
shall determine how the Servicer shall proceed with respect to the Mortgaged
Property. In the event (a) the environmental inspection report indicates that
the Mortgaged Property is contaminated by hazardous or toxic substances or
wastes and (b) the Depositor directs the Servicer to proceed with foreclosure or
acceptance of a deed in lieu of foreclosure, the Servicer shall be reimbursed
for all reasonable costs associated with such foreclosure or acceptance of a
deed in lieu of foreclosure and any related environmental clean-up costs, as
applicable, from the related Liquidation Proceeds, or if the Liquidation
Proceeds are insufficient to fully reimburse the Servicer, the Servicer shall be
entitled to be reimbursed from amounts in the Collection Account pursuant to
Section 3.11 hereof. In the event the Depositor directs the Servicer not to
proceed with foreclosure or acceptance of a deed in lieu of foreclosure, the
Servicer shall be reimbursed from general collections for all Servicing Advances
made with respect to the related Mortgaged Property from the Collection Account
pursuant to Section 3.11 hereof.
Section 3.16 Release of Mortgage Files.
(a) Upon the payment in full of any Mortgage Loan, or the receipt by
the Servicer of a notification that payment in full shall be escrowed in a
manner customary for such purposes, the Servicer will, within five (5) Business
Days of the payment in full, notify the Trustee 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 related Collection Account pursuant to Section 3.10 have been
or will be so deposited) of a Servicing Officer and shall request delivery to it
of the Custodial File. Upon receipt of such certification and request, the
Trustee shall promptly release the related Custodial File to the Servicer within
two (2) Business Days. No expenses incurred in connection with any instrument of
satisfaction or deed of reconveyance shall be chargeable to the related
Collection Account.
(b) From time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan, including, for this purpose, collection under
any insurance policy relating to the Mortgage Loans, the Trustee shall, upon
request of the Servicer and delivery to the Trustee, of a Request for Release,
release the related Custodial File to the Servicer, and the Trustee shall, at
the direction of the Servicer, execute such documents as shall be necessary to
the prosecution of any such proceedings and the Servicer shall retain the
Mortgage File in trust for the benefit of the Trustee. Such Request for Release
shall obligate the Servicer to return each and every document previously
requested from the Custodial File to the Trustee when the need therefor by the
Servicer no longer exists, unless the Mortgage Loan has been liquidated and the
Liquidation Proceeds relating to the Mortgage Loan have been deposited in the
related Collection Account or the Mortgage File or such document 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 certifying as to the name and address of the Person to which
such Mortgage File or such document was delivered and the purpose or purposes of
such delivery. Upon receipt of a certificate of a Servicing Officer stating that
such Mortgage Loan was liquidated and that all amounts received or to be
received in connection with such liquidation that are required to be deposited
into the related Collection Account have been so deposited, or that such
Mortgage Loan has become an REO Property, a copy of the Request for Release of
Documents shall be released by the Trustee to the Servicer or its designee.
Upon written certification of a Servicing Officer, the Trustee shall
execute and deliver to the Servicer any court pleadings, requests for trustee's
sale or other documents reasonably 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, or shall
exercise and deliver to the Servicer a power of attorney sufficient to authorize
the Servicer to execute such documents on its behalf. Each such certification
shall include a request that such pleadings or documents be executed by the
Trustee and a statement as to the reason such documents or pleadings are
required and that the execution and delivery thereof by the Trustee will not
invalidate or otherwise affect the lien of the Mortgage, except for the
termination of such a lien upon completion of the foreclosure or trustee's sale.
Section 3.17 Title, Conservation and Disposition of REO
Property.
(a) This Section shall apply only to REO Properties acquired for the
account of the Trustee and shall not apply to any REO Property relating to a
Mortgage Loan which was purchased or repurchased from the Trustee pursuant to
any provision hereof. In the event that title to any such REO Property is
acquired, the deed or certificate of sale shall be issued to the Servicer, or to
its nominee, on behalf of the Trustee.
(b) The Servicer shall manage, conserve, protect and operate each
REO Property for the Trustee solely for the purpose of its prompt disposition
and sale. The Servicer, either itself or through an agent selected by the
Servicer, shall manage, conserve, protect and operate the REO Property in the
same manner that it manages, conserves, protects and operates other foreclosed
property for its own account, and in the same manner that similar property in
the same locality as the REO Property is managed. The Servicer shall attempt to
sell the same (and may temporarily rent the same for a period not greater than
one year, except as otherwise provided below) on such terms and conditions as
the Servicer deems to be in the best interest of the Trustee. The Servicer shall
notify the Trustee from time to time as to the status of each REO Property.
(c) The Servicer shall use its best efforts to dispose of the REO
Property as soon as possible (subject to the Trustee's right to veto any
proposed sale of REO Property) and shall sell such REO Property in any event
within one year after title has been taken to such REO Property, unless the
Servicer determines, and gives an appropriate notice to the Trustee to such
effect, that a longer period is necessary for the orderly liquidation of such
REO Property. If a period longer than one year is permitted under the foregoing
sentence and is necessary to sell any REO Property, the Servicer shall report
monthly to the Trustee as to the progress being made in selling such REO
Property. Notwithstanding its veto rights, the Trustee has no obligation with
respect to REO dispositions.
(d) [Reserved.]
(e) The Servicer shall segregate and hold all funds collected and
received in connection with the operation of any REO Property separate and apart
from its own funds and general assets and shall deposit such funds in the
Collection Account.
(f) The Servicer shall deposit net of reimbursement to the Servicer
for any related outstanding Servicing Advances and unpaid Servicing Fees
provided in Section 3.11 hereof, or cause to be deposited, on a daily basis in
the Collection Account all revenues received with respect to the related REO
Property and shall withdraw therefrom funds necessary for the proper operation,
management and maintenance of the REO Property.
(g) The Servicer, upon an REO Disposition, shall be entitled to
reimbursement for any related unreimbursed Servicing Advances as well as any
unpaid Servicing Fees from proceeds received in connection with the REO
Disposition, as further provided in Section 3.11.
(h) Any net proceeds from an REO Disposition which are in excess of
the unpaid principal balance of the related Mortgage Loan, plus all unpaid REO
Imputed Interest thereon through the date of the REO Disposition shall be
retained by the Servicer as additional servicing compensation.
(i) The Servicer shall use its reasonable best efforts to sell, or
cause the Subservicer to sell, any REO Property as soon as possible, but in no
event later than the conclusion of the third calendar year beginning after the
year of its acquisition by the REMIC unless (i) the Servicer applies for an
extension of such period from the Internal Revenue Service pursuant to the REMIC
Provisions and Code Section 856(e)(3), in which event such REO Property shall be
sold within the applicable extension period, or (ii) the Servicer obtains for
the Trustee an Opinion of Counsel, addressed to the Depositor, the Trustee and
the Servicer, to the effect that the holding by the REMIC of such REO Property
subsequent to such period will not result in the imposition of taxes on
"prohibited transactions" as defined in Section 860F of the Code or cause the
REMIC to fail to qualify as a REMIC under the REMIC Provisions or comparable
provisions of relevant state laws at any time. The Servicer shall manage,
conserve, protect and operate each REO Property for the Trustee solely for the
purpose of its prompt disposition and sale in a manner which does not cause such
REO Property to fail to qualify as "foreclosure property" within the meaning of
Section 860G(a)(8) or result in the receipt by the REMIC of any "income from
non-permitted assets" within the meaning of Section 860F(a)(2)(B) of the Code or
any "net income from foreclosure property" which is subject to taxation under
Section 860G(a)(1) of the Code. Pursuant to its efforts to sell such REO
Property, the Servicer shall either itself or through an agent selected by the
Servicer protect and conserve such REO Property in the same manner and to such
extent as is customary in the locality where such REO Property is located and
may, incident to its conservation and protection of the interests of the Trustee
on behalf of the Certificateholders, rent the same, or any part thereof, as the
Servicer deems to be in the best interest of the Trustee on behalf of the
Certificateholders for the period prior to the sale of such REO Property;
provided, however, that any rent received or accrued with respect to such REO
Property qualifies as "rents from real property" as defined in Section 856(d) of
the Code.
Section 3.18 Notification of Adjustments.
With respect to each Mortgage Loan, the Servicer shall adjust the
Mortgage Rate on the related interest rate adjustment date and shall adjust the
Scheduled Payment on the related mortgage payment adjustment date, if
applicable, in compliance with the requirements of applicable law and the
related Mortgage and Mortgage Note. The Servicer shall execute and deliver any
and all necessary notices required under applicable law and the terms of the
related Mortgage Note and Mortgage regarding the Mortgage Rate and Scheduled
Payment adjustments. The Servicer shall promptly, upon written request therefor,
deliver to the Trustee such notifications and any additional applicable data
regarding such adjustments and the methods used to calculate and implement such
adjustments. Upon the discovery by the Servicer or the receipt of notice from
the Trustee that the Servicer has failed to adjust a Mortgage Rate or Scheduled
Payment in accordance with the terms of the related Mortgage Note, the Servicer
shall deposit in the related Collection Account from its own funds the amount of
any interest loss caused as such interest loss occurs.
Section 3.19 Access to Certain Documentation and Information
Regarding the Mortgage Loans.
In the event either a Servicer reasonably believes that compliance
with this Section will make the Mortgage Loans legal for investment by federally
insured savings and loan associations, the applicable Servicer shall provide, or
cause the Subservicer to provide, to the Depositor, the Trustee, the OTS or the
FDIC and the examiners and supervisory agents thereof access to the
documentation regarding the Mortgage Loans in its possession required by
applicable regulations of the OTS. Such access shall be afforded without charge,
but only upon reasonable and prior written request and during normal business
hours at the offices of the applicable Servicer, the Depositor, the Trustee or
any Subservicer. Nothing in this Section shall derogate from the obligation of
each Servicer, the Depositor, the Trustee or any Subservicer to observe any
applicable law prohibiting disclosure of information regarding the Mortgagors
and the failure of a Servicer, the Depositor, the Trustee or any Subservicer to
provide access as provided in this Section as a result of such obligation shall
not constitute a breach of this Section.
Section 3.20 Documents, Records and Funds in Possession of the
Servicers to Be Held for the Trustee.
Each Servicer shall account fully to the Trustee for any funds
received by such Servicer or which otherwise are collected by such Servicer as
Liquidation Proceeds or Insurance Proceeds in respect of any Mortgage Loan. All
Mortgage Files and funds collected or held by, or under the control of, a
Servicer in respect of any Mortgage Loans, whether from the collection of
principal and interest payments or from Liquidation Proceeds, including, but not
limited to, any funds on deposit in its Collection Account, shall be held by
such Servicer for and on behalf of the Trustee and shall be and remain the sole
and exclusive property of the Trustee, subject to the applicable provisions of
this Agreement. Each Servicer also agrees that it shall not create, incur or
subject any Mortgage File or any funds that are deposited in the Collection
Account, the Distribution Account or any Escrow Account, or any funds that
otherwise are or may become due or payable to the Trustee for the benefit of the
Certificateholders, to any claim, lien, security interest, judgment, levy, writ
of attachment or other encumbrance, or assert by legal action or otherwise any
claim or right of setoff against any Mortgage File or any funds collected on, or
in connection with, a Mortgage Loan, except, however, that such Servicer shall
be entitled to set off against and deduct from any such funds any amounts that
are properly due and payable to such Servicer under this Agreement.
Section 3.21 Servicing Compensation.
(a) As compensation for its activities hereunder, each Servicer
shall, with respect to each Mortgage Loan, be entitled to retain from deposits
to its Collection Account and from Liquidation Proceeds, Insurance Proceeds and
REO Proceeds related to such Mortgage Loan, the Servicing Fee with respect to
each Mortgage Loan (less any portion of such amounts retained by any
Subservicer). In addition, each Servicer shall be entitled to recover unpaid
Servicing Fees out of related late collections to the extent permitted in
Section 3.11. The right to receive the Servicing Fee may not be transferred in
whole or in part except in connection with the transfer of all of either a
Servicer's responsibilities and obligations under this Agreement; provided,
however, that each Servicer may pay from the Servicing Fee any amounts due to a
Subservicer pursuant to a Subservicing Agreement entered into under Section
3.02.
(b) Additional servicing compensation in the form of assumption or
modification fees, late payment charges, NSF fees, reconveyance fees and other
similar fees and charges (other than Prepayment Charges) shall be retained by a
Servicer only to the extent such fees or charges are received by such Servicer.
Each Servicer shall also be entitled pursuant to Section 3.11(a)(iv) to withdraw
from the related Collection Account, as additional servicing compensation,
interest or other income earned on deposits therein.
(c) Each Servicer shall be required to pay all expenses incurred
by it in connection with its servicing activities hereunder (including payment
of premiums for any blanket policy insuring against hazard losses pursuant to
Section 3.13, servicing compensation of the Subservicer to the extent not
retained by it and the fees and expenses of independent accountants and any
agents appointed by such Servicer), and shall not be entitled to reimbursement
therefor from the Trust Fund except as specifically provided in Section 3.11.
Section 3.22 Annual Statement as to Compliance.
Each Servicer will deliver or cause to be delivered to the
Depositor, the Rating Agencies and the Trustee on or before April 15 of each
calendar year, commencing in 2003, an Officers' Certificate stating, as to each
signatory thereof, that (i) a review of the activities of such Servicer during
the preceding calendar year and of performance under this Agreement or a similar
agreement has been made under such officers' supervision, and (ii) to the best
of such officers' knowledge, based on such review, such Servicer has fulfilled
all of 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 officers and the nature and status thereof.
Section 3.23 Annual Independent Public Accountants' Servicing
Statement; Financial Statements.
Not later than April 15th of each calendar year commencing in 2003,
each Servicer, at its expense, shall cause a nationally recognized firm of
independent certified public accountants to furnish to the Depositor, each
Servicer, the Rating Agencies and the Trustee a report stating that (i) it has
obtained a letter of representation regarding certain matters from the
management of such Servicer which includes an assertion that such Servicer has
complied with certain minimum residential mortgage loan servicing standards,
identified in the Uniform Single Attestation Program for Mortgage Bankers
established by the Mortgage Bankers Association of America, with respect to the
servicing of residential mortgage loans during the most recently completed
fiscal year and (ii) on the basis of an examination conducted by such firm in
accordance with standards established by the American Institute of Certified
Public Accountants, such representation is fairly stated in all material
respects, subject to such exceptions and other qualifications that may be
appropriate. In rendering its report such firm may rely, as to matters relating
to the direct servicing of residential mortgage loans by Subservicers, upon
comparable reports of firms of independent certified public accountants rendered
on the basis of examinations conducted in accordance with the same standards
(rendered within one year of such report) with respect to those Subservicers.
Section 3.24 Trustee to Act as Servicer.
In the event that either Servicer shall for any reason no longer be
a Servicer hereunder (including by reason of an Event of Default), the Trustee
or its successor shall thereupon assume all of the rights and obligations of
such Servicer hereunder arising thereafter (except that the Trustee shall not be
(i) liable for losses of such Servicer pursuant to Section 3.10 or any acts or
omissions of such predecessor Servicer hereunder), (ii) obligated to make
Advances if it is prohibited from doing so by applicable law, (iii) obligated to
effectuate repurchases of Mortgage Loans hereunder, including but not limited to
repurchases pursuant to Section 2.03, (iv) responsible for expenses of such
Servicer pursuant to Section 2.03 or (v) deemed to have made any representations
and warranties of such Servicer hereunder. Any such assumption shall be subject
to Section 7.02.
Every subservicing agreement entered into by a Servicer shall
contain a provision giving the successor Servicer the option to terminate such
agreement in the event a successor Servicer is appointed.
If either Servicer shall for any reason no longer be a Servicer
(including by reason of any Event of Default), the Trustee (or any other
successor Servicer) may, at its option, succeed to any rights and obligations of
such Servicer under any subservicing agreement in accordance with the terms
thereof; provided that the Trustee (or any other successor Servicer) shall not
incur any liability or have any obligations in its capacity as successor
Servicer under a subservicing agreement arising prior to the date of such
succession unless it expressly elects to succeed to the rights and obligations
of such Servicer thereunder; and such Servicer shall not thereby be relieved of
any liability or obligations under the subservicing agreement arising prior to
the date of such succession.
The applicable Servicer shall, upon request of the Trustee, but at
the expense of such Servicer, deliver to the assuming party all documents and
records relating to each subservicing agreement (if any) and the Mortgage Loans
then being serviced thereunder and an accounting of amounts collected held by it
and otherwise use its best efforts to effect the orderly and efficient transfer
of the subservicing agreement to the assuming party.
Section 3.25 Compensating Interest.
Each Servicer shall remit to the Trustee on each Remittance Date an
amount from its own funds equal to Compensating Interest payable by such
Servicer on such Remittance Date.
Section 3.26 Credit Reporting; Xxxxx-Xxxxx-Xxxxxx Act.
(a) With respect to each Group I Mortgage Loan, each Servicer
agrees to fully furnish, in accordance with the Fair Credit Reporting Act and
its implementing regulations, accurate and complete information (e.g., favorable
and unfavorable) on its borrower credit files to Equifax, Experian, and Trans
Union Credit Information Company (three of the credit repositories), on a
monthly basis.
(b) Each Servicer shall comply with Title V of the
Xxxxx-Xxxxx-Xxxxxx Act of 1999 and all applicable regulations promulgated
thereunder, relating to the Mortgage Loans required to be serviced by it and the
related borrowers and shall provide all required notices thereunder.
ARTICLE IV
DISTRIBUTIONS AND
ADVANCES BY THE SERVICERS
Section 4.01 Advances.
(a) The amount of P&I Advances to be made by each Servicer for any
Remittance Date shall equal, subject to Section 4.01(c), the sum of (i) the
aggregate amount of Scheduled Payments (with each interest portion thereof net
of the related Servicing Fee), due during the Due Period immediately preceding
such Remittance Date in respect of the Mortgage Loans, which Scheduled Payments
were not received as of the close of business on the Business Day preceding such
Remittance Date, plus (ii) with respect to each REO Property, which REO Property
was acquired during or prior to the related Prepayment Period and as to which
such REO Property an REO Disposition did not occur during the related Prepayment
Period, an amount equal to the excess, if any, of the Scheduled Payments (with
each interest portion thereof net of the related Servicing Fee) that would have
been due on the related Due Date in respect of the related Mortgage Loans, over
the net income from such REO Property transferred to the related Collection
Account for distribution on such Remittance Date.
(b) On the Remittance Date, each Servicer shall remit in
immediately available funds to the Trustee an amount equal to the aggregate
amount of P&I Advances, if any, to be made in respect of the Mortgage Loans and
REO Properties for the related Remittance Date either (i) from its own funds or
(ii) from the related Collection Account, to the extent of funds held therein
for future distribution (in which case, it will cause to be made an appropriate
entry in the records of the related Collection Account that Amounts Held For
Future Distribution have been, as permitted by this Section 4.01, used by such
Servicer in discharge of any such P&I Advance) or (iii) in the form of any
combination of (i) and (ii) aggregating the total amount of P&I Advances to be
made by such Servicer with respect to the Mortgage Loans and REO Properties. Any
Amounts Held For Future Distribution and so used shall be appropriately
reflected in such Servicer's records and replaced by such Servicer by deposit in
the related Collection Account on or before any future Remittance Date to the
extent required.
(c) The obligation of each Servicer to make such P&I Advances is
mandatory, notwithstanding any other provision of this Agreement but subject to
(d) below, and, with respect to any Mortgage Loan or REO Property, shall
continue until a Final Recovery Determination in connection therewith or the
removal thereof from coverage under this Agreement, except as otherwise provided
in this Section.
(d) Notwithstanding anything herein to the contrary, no P&I
Advance or Servicing Advance shall be required to be made hereunder by either
Servicer if such P&I Advance or Servicing Advance would, if made, constitute a
Nonrecoverable P&I Advance or Nonrecoverable Advance. The determination by
either Servicer that it has made a Nonrecoverable P&I Advance or a
Nonrecoverable Advance or that any proposed P&I Advance or Servicing Advance, if
made, would constitute a Nonrecoverable P&I Advance or a Nonrecoverable Advance,
respectively, shall be evidenced by an Officers' Certificate of such Servicer
delivered to the Trustee.
(e) Except as otherwise provided herein, the applicable Servicer
shall be entitled to reimbursement pursuant to Section 3.11 hereof for Servicing
Advances from recoveries from the related Mortgagor or from all Liquidation
Proceeds and other payments or recoveries (including Insurance Proceeds and
Condemnation Proceeds) with respect to the related Mortgage Loan.
Section 4.02 Priorities of Distribution.
(a) On each Distribution Date, the Trustee will make the
disbursements and transfers from amounts then on deposit in the Distribution
Account in the following order of priority and to the extent of the Available
Funds remaining:
(i) to the holders of each Class of Certificates in the following
order of priority:
(a) to the Class A Certificates, the related Accrued
Certificate Interest Distribution Amount and any Unpaid Interest
Amounts for such Distribution Date, as described below in Section
4.02(a)(iv);
(b) to the Class M-1 Certificates, the Accrued Certificate
Interest Distribution Amount for such Class on such Distribution
Date;
(c) to the Class M-2 Certificates, the Accrued Certificate
Interest Distribution Amount for such Class on such Distribution
Date;
(d) to the Class B-1 Certificates, the Accrued Certificate
Interest Distribution Amount for such Class on such Distribution
Date; and
(e) to the Class B-2 Certificates, the Accrued Certificate
Interest Distribution Amount for such Class on such Distribution
Date;
(ii) (A) on each Distribution Date (a) before the related Stepdown
Date or (b) with respect to which a Trigger Event is in effect, to the
holders of the related Class or Classes of Offered Certificates then
entitled to distributions of principal as set forth below, an amount equal
to the Principal Distribution Amount in the following order of priority:
(a) to the Class A-1 and Class A-2 Certificates, allocated as
described in Section 4.02(c), until the respective Class Certificate
Balances thereof are reduced to zero;
(b) sequentially to the Class M-1, Class M-2 , Class B-1 and
Class B-2 Certificates, in that order, until the respective Class
Certificate Balances are reduced to zero;
(B) on each Distribution Date (a) on and after the related Stepdown
Date and (b) as long as a Trigger Event is not in effect, to the holders of the
related Class or Classes of Offered Certificates then entitled to distribution
of principal an amount equal to, in the aggregate, the Principal Distribution
Amount in the following amounts and order of priority:
(a) the lesser of (x) the Principal Distribution Amount and
(y) the Class A Principal Distribution Amount to the Class A
Certificates, allocated as described in Section 4.02(c), until the
respective Class Certificate Balances thereof are reduced to zero;
(b) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the amount distributed to the Class A
Certificateholders in clause (ii)(B)(a) above and (y) the Class M-1
Principal Distribution Amount to the Class M-1 Certificateholders,
until the Class Certificate Balance thereof has been reduced to
zero;
(c) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the amount distributed to the Class A
Certificateholders in clause (ii)(B)(a) above and to the Class M-1
Certificates in clause (ii)(B)(b) above and (y) the Class M-2
Principal Distribution Amount to the Class M-2 Certificateholders,
until the Class Certificate Balance thereof has been reduced to
zero;
(d) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the amount distributed to the Class A
Certificateholders in clause (ii)(B)(a) above, to the Class M-1
Certificates in clause (ii)(B)(b) above and to the Class M-2
Certificates in clause (ii)(B)(c) above and (y) the Class B-1
Principal Distribution Amount to the Class B-1 Certificateholders,
until the Class Certificate Balance thereof has been reduced to
zero;
(e) the lesser of (x) the excess of (i) the Principal
Distribution Amount over (ii) the amount distributed to the Class A
Certificateholders in clause (ii)(B)(a) above, to the Class M-1
Certificates in clause (ii)(B)(b) above, to the Class M-2
Certificates in clause (ii)(B)(c) above and to the Class B-1
Certificates in clause (ii)(B)(d) above and (y) the Class B-2
Principal Distribution Amount to the Class B-2 Certificateholders,
until their Class Certificate Balance has been reduced to zero;
(iii) any amount remaining after the distributions in clauses (i)
and (ii) above shall be distributed in the following order of priority:
(a) to the holders of the Class M-1 Certificates, any Unpaid
Interest Amounts for such Class;
(b) to the holders of the Class M-1 Certificates, any Unpaid
Realized Loss Amount for such Class;
(c) to the holders of the Class M-2 Certificates, any Unpaid
Interest Amounts for such Class;
(d) to the holders of the Class M-2 Certificates, any Unpaid
Realized Loss Amount for such Class;
(e) to the holders of the Class B-1 Certificates, any Unpaid
Interest Amounts for such Class;
(f) to the holders of the Class B-1 Certificates, any Unpaid
Realized Loss Amount for such Class;
(g) to the holders of the Class B-2 Certificates, any Unpaid
Interest Amounts for such Class;
(h) to the holders of the Class B-2 Certificates, any Unpaid
Realized Loss Amount for such Class;
(i) to the Excess Reserve Fund Account, the amount of any
Basis Risk Payment for such Distribution Date;
(j) from funds on deposit in the Excess Reserve Fund Account,
an amount equal to any Basis Risk CarryForward Amount with respect
to any Floating Rate Certificate for such Distribution Date to the
Floating Rate Certificates in the same order and priority in which
Accrued Certificate Interest is allocated among those Classes of
Certificates;
(k) to the holders of the Class X Certificates, the remainder
of the Class X Distributable Amount not distributed pursuant to
Sections 4.02(a)(iii)(a)-(h); and
(l) to the holders of the Class R Certificates, any remaining
amount.
(iv) Solely for purposes of this interest allocation calculation,
the portion of the interest component of Available Funds attributable to
Group I Mortgage Loans will be allocated:
(a) first, to the Class A-1 Certificates, the Accrued
Certificate Interest Distribution Amount and any Unpaid Interest
Amounts for the Class A-1 Certificates;
(b) second, to the Class A-2 Certificates, the Accrued
Certificate Interest Distribution Amount and any Unpaid Interest
Amounts for the Class A-2 Certificates to the extent not otherwise
previously paid from the interest component of Available Funds
attributable to Group II Mortgage Loans.
Solely for purposes of this interest allocation calculation, the
portion of the interest component of Available Funds attributable to Group
II Mortgage Loans will be allocated:
(a) first, to the Class A-2 Certificates, the Accrued
Certificate Interest Distribution Amount and any Unpaid Interest
Amounts for the Class A-2 Certificates;
(b) second, to the Class A-1 Certificates, the Accrued
Certificate Interest Distribution Amount and any Unpaid Interest
Amounts for the Class A-1 Certificates to the extent not otherwise
previously paid from the interest component of Available Funds
attributable to Group I Mortgage Loans.
If on any Distribution Date, as a result of the foregoing
allocation rules, either class of Class A Certificates does not receive
the related Accrued Certificate Interest Distribution Amount or the
related Unpaid Interest Amounts, if any, then that unpaid amount will be
recoverable by the holders of that class, with interest thereon, on future
Distribution Dates, as Unpaid Interest Amounts, subject to the priorities
described above.
(b) On each Distribution Date, all amounts representing Prepayment
Charges from the Mortgage Loans received during the related Prepayment Period
will be distributed to the holders of the Class P Certificates.
(c) On the July 2002 and August 2002 Distribution Dates, the
Trustee shall transfer from the Capitalized Interest Account to the Distribution
Account the Capitalized Interest Requirement, if any, for such Distribution
Date.
(d) On the Distribution Date following either the final Subsequent
Transfer Date or end of the Pre-Funding Period, whichever date is earlier, any
amounts remaining in the Capitalized Interest Account, after taking into account
the transfers in respect of the Distribution Dates described in clause (c)
above, shall be paid to the Purchaser.
(e) On each Subsequent Transfer Date, the Depositor shall instruct
in writing the Trustee to withdraw from each of the Pre-Funding Accounts an
amount equal to 100% of the aggregate Stated Principal Balances as of the
related Subsequent Cut-off Date of the Subsequent Mortgage Loans sold to the
Trust Fund on such Subsequent Transfer Date and pay such amount to or upon the
order of the Purchaser upon satisfaction of the conditions set forth in Section
2.01(c) hereof with respect to such transfer. The Trustee may conclusively rely
on such written instructions from the Depositor.
(f) If the Pre-Funding Amount available in either Pre-Funding
Account (exclusive of Pre-Funding Earnings) has been reduced to $100,000 or less
by the close of business on August 16, 2002 then, on the August 26, 2002
Distribution Date, after giving effect to any reductions in such Pre-Funding
Amount on such date, the Trustee shall withdraw from the related Pre-Funding
Account on such date and deposit in the Distribution Account the amount on
deposit in such Pre-Funding Account other than any Pre-Funding Earnings; if the
Pre-Funding Amount available in either Pre-Funding Account has not been reduced
to zero by the close of business on August 16, 2002, the Trustee shall withdraw
from each Pre-Funding Account the amount on deposit therein, other than the
Pre-Funding Earnings, and deposit such amount on the August, 2002 Distribution
Date into the Distribution Account. Each amount deposited to the Distribution
Account from the Group I Pre-Funding Account pursuant to this Section 4.02(f)
shall be distributed to the Holders of the Class A-1 Certificates, as a separate
payment of principal, on the related Distribution Date. Each amount deposited to
the Distribution Account from the Group II Pre-Funding Account pursuant to this
Section 4.02(f) shall be distributed to the Holders of the Class A-2
Certificates, as a separate payment of principal, on the related Distribution
Date.
(g) On the July and August 2002 Distribution Dates, the Trustee
shall transfer from each Pre-Funding Account to the Distribution Account the
Pre-Funding Earnings, if any, applicable to each such date.
(h) All principal distributions to the holders of the Class A
Certificates on any Distribution Date will be allocated between the Class A-1
Certificates and the Class A-2 Certificates on a pro rata basis based on the
Class A Principal Allocation Percentage for each of those Classes for that
Distribution Date; provided, however, that if the Class Certificate Balance of
either Class of Class A Certificates is reduced to zero, then the remaining
amount of principal distributions distributable to the Class A Certificates on
that Distribution Date, and the amount of principal distributions distributable
on all subsequent Distribution Dates will be distributed to the holders of the
Class of Class A Certificates remaining outstanding until its Class Certificate
Balance has been reduced to zero. Any payments of principal to the Class A-1
Certificates shall be made first from Available Funds relating to the Group I
Mortgage Loans. Any payments of principal to the Class A-2 Certificates shall be
made first from Available Funds relating to the Group II Mortgage Loans.
(i) On any Distribution Date, any Relief Act Shortfalls and Net
Prepayment Interest Shortfalls for such Distribution Date will be allocated as a
reduction in the following order:
(1) First, to the amount of interest payable to the Class X
Certificates; and
(2) Second, pro rata, as a reduction of the Accrued
Certificate Interest for the Class A, Class M and Class
B Certificates, based on the amount of interest to which
such classes would otherwise be entitled.
Section 4.03 Monthly Statements to Certificateholders.
(a) Not later than each Distribution Date, the Trustee shall make
available to each Certificateholder, the Servicers, the Depositor and each
Rating Agency a statement setting forth with respect to the related
distribution:
(i) the amount thereof allocable to principal, separately
identifying the aggregate amount of any Principal Prepayments and
Liquidation Proceeds included therein;
(ii) the amount thereof allocable to interest, any Unpaid Interest
Amounts included in such distribution and any remaining Unpaid Interest
Amounts after giving effect to such distribution, any Basis Risk
CarryForward Amount for such Distribution Date and the amount of all Basis
Risk CarryForward Amount covered by withdrawals from the Excess Reserve
Fund Account on such Distribution Date;
(iii) if the distribution to the Holders of such Class of
Certificates is less than the full amount that would be distributable to
such Holders if there were sufficient funds available therefor, the amount
of the shortfall and the allocation thereof as between principal and
interest, including any Basis Risk CarryForward Amount not covered by
amounts in the Excess Reserve Fund Account;
(iv) the Class Certificate Balance of each Class of Certificates
after giving effect to the distribution of principal on such Distribution
Date;
(v) the Pool Stated Principal Balance for the following Distribution
Date;
(vi) the amount of the Servicing Fees paid to or retained by the
Servicers or Subservicer (with respect to the Subservicers, in the
aggregate) with respect to such Distribution Date;
(vii) the Pass-Through Rate for each such Class of Certificates with
respect to such Distribution Date;
(viii) the amount of P&I Advances included in the distribution on
such Distribution Date and the aggregate amount of P&I Advances reported
by the Servicers as outstanding as of the close of business on such
Distribution Date;
(ix) the number and aggregate outstanding principal balances of
Mortgage Loans (1) as to which the Scheduled Payment is delinquent 31 to
60 days, 61 to 90 days and 91 or more days, (2) that have become REO
Property, (3) that are in foreclosure and (4) that are in bankruptcy, in
each case as of the close of business on the last Business Day of the
immediately preceding month;
(x) For each of the preceding 12 calendar months, or all calendar
months since the related Cut-off Date, whichever is less, the aggregate
dollar amount of the Scheduled Payments (A) due on all Outstanding
Mortgage Loans on each of the Due Dates in each such month and (B)
delinquent 60 days or more on each of the Due Dates in each such month;
(xi) with respect to any Mortgage Loan that became an REO Property
during the preceding calendar month, the loan number and Stated Principal
Balance of such Mortgage Loan as of the close of business on the
Determination Date preceding such Distribution Date and the date of
acquisition thereof;
(xii) the total number and principal balance of any REO Properties
(and market value, if available) as of the close of business on the
Determination Date preceding such Distribution Date;
(xiii) whether a Trigger Event has occurred and is continuing
(including the calculation of thereof and the aggregate outstanding
balance of all 60+ Delinquent Loans);
(xiv) the amount on deposit in the Excess Reserve Fund Account
(after giving effect to distributions on such Distribution Date);
(xv) the aggregate amount of Applied Realized Loss Amounts incurred
during the preceding calendar month and aggregate Applied Realized Loss
Amounts through such Distribution Date;
(xvi) the amount of any Net Monthly Excess Cash Flow on such
Distribution Date and the allocation thereof to the Certificateholders
with respect to Applied Realized Losses and Unpaid Interest Amounts;
(xvii) the Subordinated Amount and Required Subordinated Amount;
(xviii) Prepayment Charges collected and paid by the Servicers;
(xix) both Pre-Funded Amounts as of the end of the prior Due Period;
(xx) the amount of any principal prepayment on the Class A
Certificates resulting from the application of unused moneys in the
Pre-Funding Accounts; and
(xxi) the Cumulative Loss Percentage.
(b) The Trustee's responsibility for providing the above statement
to the Certificateholders, each Rating Agency, each Servicer and the Depositor
is limited to the availability, timeliness and accuracy of the information
derived from the applicable Servicer. The Trustee will provide the above
statement via the Trustee's internet website. The Trustee's website will
initially be located at http:\\xxx-xxxx.xxx.xxxxxxxx-xxxx.xxx\invr and
assistance in using the website can be obtained by calling the Trustee's
investor relations desk at 0-000-000-0000. A paper copy of the statement will
also be made available upon request.
(c) Within a reasonable period of time after the end of each
calendar year, the Trustee shall cause to be furnished to each Person who at any
time during the calendar year was a Certificateholder, a statement containing
the information set forth in clauses (a)(i), (a)(ii) and (a)(vii) of this
Section 4.03 aggregated for such calendar year or applicable portion thereof
during which such Person was a Certificateholder. Such obligation of the Trustee
shall be deemed to have been satisfied to the extent that substantially
comparable information shall be provided by the Trustee pursuant to any
requirements of the Code as from time to time in effect.
(d) Not later than the Determination Date, each Servicer shall
furnish to the Trustee a monthly remittance advice statement (in a format
mutually agreed upon by such Servicer and the Trustee) containing such
information as shall be reasonably requested by the Trustee to provide the
reports required by Section 4.03(a) as to the accompanying remittance and the
period ending on the close of business on the last Business Day of the
immediately preceding month.
Each Servicer shall furnish to the Trustee an individual loan
accounting report, as of the last Business Day of each month, to document
Mortgage Loan payment activity on an individual Mortgage Loan basis. With
respect to each month, the corresponding individual loan accounting report (in
electronic format) shall be received by the Trustee no later than the related
Determination Date, which report shall contain the following:
(i) with respect to each Scheduled Payment, the amount of such
remittance allocable to principal (including a separate breakdown of any
Principal Prepayment, including the date of such prepayment, and any
prepayment penalties or premiums, along with a detailed report of interest
on principal prepayment amounts remitted in accordance with Section 3.25);
(ii) with respect to each Scheduled Payment, the amount of such
remittance allocable to interest;
(iii) the amount of servicing compensation received by such Servicer
during the prior distribution period;
(iv) the individual and aggregate Stated Principal Balance of the
Mortgage Loans;
(v) the aggregate of any expenses reimbursed to such Servicer during
the prior distribution period pursuant to Section 3.05; and
(vi) the number and aggregate outstanding principal balances of
Mortgage Loans (a) delinquent (1) 31 to 60 days, (2) 61 to 90 days, (3) 91
days or more; (b) as to which foreclosure has commenced; and (c) as to
which REO Property has been acquired.
Section 4.04 Certain Matters Relating to the Determination
of LIBOR.
Until all of the LIBOR Certificates are paid in full, the Trustee
will at all times retain at least four Reference Banks for the purpose of
determining LIBOR with respect to each Interest Determination Date. The Trustee
initially shall designate the Reference Banks. Each "Reference Bank" shall be a
leading bank engaged in transactions in Eurodollar deposits in the international
Eurocurrency market, shall not control, be controlled by, or be under common
control with, the Trustee and shall have an established place of business in
London. If any such Reference Bank should be unwilling or unable to act as such
or if the Trustee should terminate its appointment as Reference Bank, the
Trustee shall promptly appoint or cause to be appointed another Reference Bank.
The Trustee shall have no liability or responsibility to any Person for (i) the
selection of any Reference Bank for purposes of determining LIBOR or (ii) any
inability to retain at least four Reference Banks which is caused by
circumstances beyond its reasonable control.
The Pass-Through Rate for each Class of LIBOR Certificates for each
Interest Accrual Period shall be determined by the Trustee on each LIBOR
Determination Date so long as the LIBOR Certificates are outstanding on the
basis of LIBOR and the respective formulae appearing in footnotes corresponding
to the LIBOR Certificates in the table relating to the Certificates in the
Preliminary Statement. The Trustee shall not have any liability or
responsibility to any Person for its inability, following a good-faith
reasonable effort, to obtain quotations from the Reference Banks or to determine
the arithmetic mean referred to in the definition of LIBOR, all as provided for
in this Section 4.04 and the definition of LIBOR. The establishment of LIBOR and
each Pass-Through Rate for the LIBOR Certificates by the Trustee shall (in the
absence of manifest error) be final, conclusive and binding upon each Holder of
a Certificate and the Trustee.
ARTICLE V
THE CERTIFICATES
Section 5.01 The Certificates.
The Certificates shall be substantially in the forms attached hereto
as exhibits. The Certificates shall be issuable in registered form, in the
minimum denominations, integral multiples in excess thereof (except that one
Certificate in each Class may be issued in a different amount which must be in
excess of the applicable minimum denomination) and aggregate denominations per
Class set forth in the Preliminary Statement.
The Depositor hereby directs the Trustee to register the Class X
Certificates and the Class P Certificates as follows: "U.S. Bank National
Association, as Indenture Trustee on behalf of the Noteholders of the Xxxxxx
Xxxxxxx Xxxx Xxxxxx Capital I Inc. NIM Trust 2002-HE1N," and to deliver such
Class X Certificates and Class P Certificates to U.S. Bank National Association,
as trustee of the NIMs Trust.
Subject to Section 9.02 respecting the final distribution on the
Certificates, on each Distribution Date the Trustee shall make distributions to
each Certificateholder of record on the preceding Record Date either (x) by wire
transfer in immediately available funds to the account of such holder at a bank
or other entity having appropriate facilities therefor, if such Holder has so
notified the Trustee at least five Business Days prior to the related Record
Date or (y) by check mailed by first class mail to such Certificateholder at the
address of such holder appearing in the Certificate Register.
The Certificates shall be executed by manual or facsimile signature
on behalf of the Trustee by an authorized officer. Certificates bearing the
manual or facsimile signatures of individuals who were, at the time such
signatures were affixed, authorized to sign on behalf of the Trustee shall bind
the Trustee, notwithstanding that such individuals or any of them have ceased to
be so authorized prior to the countersignature and delivery of any such
Certificates or did not hold such offices at the date of such Certificate. No
Certificate shall be entitled to any benefit under this Agreement, or be valid
for any purpose, unless countersigned by the Trustee by manual signature, and
such countersignature upon any Certificate shall be conclusive evidence, and the
only evidence, that such Certificate has been duly executed and delivered
hereunder. All Certificates shall be dated the date of their countersignature.
On the Closing Date, the Trustee shall countersign the Certificates to be issued
at the direction of the Depositor, or any affiliate thereof.
The Depositor shall provide, or cause to be provided, to the Trustee
on a continuous basis, an adequate inventory of Certificates to facilitate
transfers.
Section 5.02 Certificate Register; Registration of Transfer and
Exchange of Certificates.
(a) The Trustee shall maintain, or cause to be maintained in
accordance with the provisions of Section 5.06, a Certificate Register for the
Trust Fund in which, subject to the provisions of subsections (b) and (c) below
and 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. Upon surrender for registration of transfer of
any Certificate, the Trustee shall execute and deliver, in the name of the
designated transferee or transferees, one or more new Certificates of the same
Class and aggregate Percentage Interest.
At the option of a Certificateholder, Certificates may be exchanged
for other Certificates of the same Class in authorized denominations and
evidencing the same aggregate Percentage Interest upon surrender of the
Certificates to be exchanged at the office or agency of the Trustee. Whenever
any Certificates are so surrendered for exchange, the Trustee shall execute,
authenticate, and deliver the Certificates which the Certificateholder making
the exchange is entitled to receive. Every Certificate presented or surrendered
for registration of transfer or exchange shall be accompanied by a written
instrument of transfer in form satisfactory to the Trustee duly executed by the
holder thereof or his attorney duly authorized in writing.
No service charge to the Certificateholders shall be made for any
registration of transfer or exchange of Certificates, but payment of a sum
sufficient to cover any tax or governmental charge that may be imposed in
connection with any transfer or exchange of Certificates may be required.
All Certificates surrendered for registration of transfer or
exchange shall be cancelled and subsequently destroyed by the Trustee in
accordance with the Trustee's customary procedures.
(b) No transfer of a Private Certificate shall be made unless such
transfer is made pursuant to an effective registration statement under the
Securities Act and any applicable state securities laws or is exempt from the
registration requirements under said Act and such state securities laws. In
determining whether a transfer is being made pursuant to an effective
registration statement, the Trustee shall be entitled to rely solely upon a
written notice to such effect from the Depositor. Except with respect to the
transfer of the Class X and Class P Certificates to the NIMs Trust on the
Closing Date, in the event that a transfer of a Private Certificate which is a
Physical Certificate is to be made in reliance upon an exemption from the
Securities Act and such laws, in order to assure compliance with the Securities
Act and such laws, the Certificateholder desiring to effect such transfer shall
certify to the Trustee in writing the facts surrounding the transfer in
substantially the form set forth in Exhibit H (the "Transferor Certificate") and
either (i) there shall be delivered to the Trustee a letter in substantially the
form of Exhibit I (the "Rule 144A Letter") or (ii) there shall be delivered to
the Trustee at the expense of the transferor an Opinion of Counsel that such
transfer may be made without registration under the Securities Act. In the event
that a transfer of a Private Certificate which is a Book-Entry Certificate is to
be made in reliance upon an exemption from the Securities Act and such laws, in
order to assure compliance with the Securities Act and such laws, the
Certificateholder desiring to effect such transfer will be deemed to have made
as of the transfer date each of the certifications set forth in the Transferor
Certificate in respect of such Certificate and the transferee will be deemed to
have made as of the transfer date each of the certifications set forth in the
Rule 144A Letter in respect of such Certificate, in each case as if such
Certificate were evidenced by a Physical Certificate. The Depositor shall
provide to any Holder of a Private Certificate and any prospective transferee
designated by any such Holder, information regarding the related Certificates
and the Mortgage Loans and such other information as shall be necessary to
satisfy the condition to eligibility set forth in Rule 144A(d)(4) for transfer
of any such Certificate without registration thereof under the Securities Act
pursuant to the registration exemption provided by Rule 144A. The Trustee and
the Servicers shall cooperate with the Depositor in providing the Rule 144A
information referenced in the preceding sentence, including providing to the
Depositor such information regarding the Certificates, the Mortgage Loans and
other matters regarding the Trust Fund as the Depositor shall reasonably request
to meet its obligation under the preceding sentence. Each Holder of a Private
Certificate desiring to effect such transfer shall, and does hereby agree to,
indemnify the Trustee and the Depositor and each Servicer against any liability
that may result if the transfer is not so exempt or is not made in accordance
with such federal and state laws.
Except with respect to the transfer of the Class X and Class P
Certificates to the NIMs Trust on the Closing Date, no transfer of an
ERISA-Restricted Certificate shall be made unless the Trustee shall have
received either (i) a representation from the transferee of such Certificate
acceptable to and in form and substance satisfactory to the Trustee (in the
event such Certificate is a Private Certificate or a Residual Certificate, such
requirement is satisfied only by the Trustee's receipt of a representation
letter from the transferee substantially in the form of Exhibit I), to the
effect that such transferee is not an employee benefit plan or arrangement
subject to Section 406 of ERISA, a plan subject to Section 4975 of the Code or a
plan subject to any Federal, state or local law ("Similar Law") materially
similar to the foregoing provisions of ERISA or the Code, nor a person acting on
behalf of any such plan or arrangement nor using the assets of any such plan or
arrangement to effect such transfer, or (ii) in the case of an ERISA-Restricted
Certificate other than a Residual Certificate or a Class P Certificate that has
been the subject of an ERISA-Qualifying Underwriting, and the purchaser is an
insurance company, a representation that the purchaser is an insurance company
that is purchasing such Certificates with funds contained in an "insurance
company general account" (as such term is defined in Section V(e) of Prohibited
Transaction Class Exemption 95-60 ("PTCE 95-60") and that the purchase and
holding of such Certificates are covered under Sections I and III of PTCE 95-60
or (iii) in the case of any such ERISA-Restricted Certificate other than a
Residual Certificate or Class P Certificate presented for registration in the
name of an employee benefit plan subject to Title I of ERISA, a plan or
arrangement subject to Section 4975 of the Code (or comparable provisions of any
subsequent enactments), or a plan subject to Similar Law, or a trustee of any
such plan or any other person acting on behalf of any such plan or arrangement
or using such plan's or arrangement's assets, an Opinion of Counsel satisfactory
to the Trustee and each Servicer, which Opinion of Counsel shall not be an
expense of the Trustee, the Servicers or the Trust Fund, addressed to the
Trustee, 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" and subject to the prohibited transaction provisions of ERISA and
the Code or similar violation of Similar Law and will not subject the Trustee or
the Servicers to any obligation in addition to those expressly undertaken in
this Agreement or to any liability. For purposes of the preceding sentence, with
respect to an ERISA-Restricted Certificate that is not a Private Certificate or
a Residual Certificate, in the event the representation letter referred to in
the preceding sentence is not furnished, such representation shall be deemed to
have been made to the Trustee by the transferee's (including an initial
acquirer's) acceptance of the ERISA-Restricted Certificates. In the event that
such representation is violated, or any attempt to transfer to a plan or
arrangement subject to Section 406 of ERISA, a plan subject to Section 4975 of
the Code or a plan subject to Similar Law, or a person acting on behalf of any
such plan or arrangement or using the assets of any such plan or arrangement,
without such Opinion of Counsel, such attempted transfer or acquisition shall be
void and of no effect.
To the extent permitted under applicable law (including, but not
limited to, ERISA), the Trustee shall be under no liability to any Person for
any registration of transfer of any ERISA-Restricted Certificate that is in fact
not permitted by this Section 5.02(b) or for making any payments due on such
Certificate to the Holder thereof or taking any other action with respect to
such Holder under the provisions of this Agreement so long as the transfer was
registered by the Trustee in accordance with the foregoing requirements.
(c) Each Person who has or who acquires any Ownership Interest in
a Residual Certificate shall be deemed by the acceptance or acquisition of such
Ownership Interest to have agreed to be bound by the following provisions, and
the rights of each Person acquiring any Ownership Interest in a Residual
Certificate are expressly subject to the following provisions:
(i) Each Person holding or acquiring any Ownership Interest in a
Residual Certificate shall be a Permitted Transferee and shall promptly
notify the Trustee of any change or impending change in its status as a
Permitted Transferee.
(ii) No Ownership Interest in a Residual Certificate may be
registered on the Closing Date or thereafter transferred, and the Trustee
shall not register the Transfer of any Residual Certificate unless, in
addition to the certificates required to be delivered to the Trustee under
subparagraph (b) above, the Trustee shall have been furnished with an
affidavit (a "Transfer Affidavit") of the initial owner or the proposed
transferee in the form attached hereto as Exhibit G.
(iii) Each Person holding or acquiring any Ownership Interest in a
Residual Certificate shall agree (A) to obtain a Transfer Affidavit from
any other Person to whom such Person attempts to Transfer its Ownership
Interest in a Residual Certificate, (B) to obtain a Transfer Affidavit
from any Person for whom such Person is acting as nominee, trustee or
agent in connection with any Transfer of a Residual Certificate and (C)
not to Transfer its Ownership Interest in a Residual Certificate or to
cause the Transfer of an Ownership Interest in a Residual Certificate to
any other Person if it has actual knowledge that such Person is not a
Permitted Transferee.
(iv) Any attempted or purported Transfer of any Ownership Interest
in a Residual Certificate in violation of the provisions of this Section
5.02(c) shall be absolutely null and void and shall vest no rights in the
purported Transferee. If any purported transferee shall become a Holder of
a Residual Certificate in violation of the provisions of this Section
5.02(c), then the last preceding Permitted Transferee shall be restored to
all rights as Holder thereof retroactive to the date of registration of
Transfer of such Residual Certificate. The Trustee shall be under no
liability to any Person for any registration of Transfer of a Residual
Certificate that is in fact not permitted by Section 5.02(b) and this
Section 5.02(c) or for making any payments due on such Certificate to the
Holder thereof or taking any other action with respect to such Holder
under the provisions of this Agreement so long as the Transfer was
registered after receipt of the related Transfer Affidavit, Transferor
Certificate and the Rule 144A Letter. The Trustee shall be entitled but
not obligated to recover from any Holder of a Residual Certificate that
was in fact not a Permitted Transferee at the time it became a Holder or,
at such subsequent time as it became other than a Permitted Transferee,
all payments made on such Residual Certificate at and after either such
time. Any such payments so recovered by the Trustee shall be paid and
delivered by the Trustee to the last preceding Permitted Transferee of
such Certificate.
(v) The Depositor shall use its best efforts to make available, upon
receipt of written request from the Trustee, all information necessary to
compute any tax imposed under Section 860E(e) of the Code as a result of a
Transfer of an Ownership Interest in a Residual Certificate to any Holder
who is not a Permitted Transferee.
The restrictions on Transfers of a Residual Certificate set forth in
this Section 5.02(c) shall cease to apply (and the applicable portions of the
legend on a Residual Certificate may be deleted) with respect to Transfers
occurring after delivery to the Trustee of an Opinion of Counsel, which Opinion
of Counsel shall not be an expense of the Trust Fund, the Trustee or the
Servicers, to the effect that the elimination of such restrictions will not
cause the Trust Fund hereunder to fail to qualify as a REMIC at any time that
the Certificates are outstanding or result in the imposition of any tax on the
Trust Fund, a Certificateholder or another Person. Each Person holding or
acquiring any Ownership Interest in a Residual Certificate hereby consents to
any amendment of this Agreement which, based on an Opinion of Counsel furnished
to the Trustee, is reasonably necessary (a) to ensure that the record ownership
of, or any beneficial interest in, a Residual Certificate is not transferred,
directly or indirectly, to a Person that is not a Permitted Transferee and (b)
to provide for a means to compel the Transfer of a Residual Certificate which is
held by a Person that is not a Permitted Transferee to a Holder that is a
Permitted Transferee.
(d) The preparation and delivery of all certificates and opinions
referred to above in this Section 5.02 in connection with transfer shall be at
the expense of the parties to such transfers.
(e) Except as provided 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 Certificates may not be transferred by the
Trustee except to another Depository; (ii) the Depository shall maintain
book-entry records with respect to the Certificate Owners and with respect to
ownership and transfers of such Book-Entry Certificates; (iii) 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;
(iv) the Depository may collect its usual and customary fees, charges and
expenses from its Depository Participants; (v) the Trustee shall deal with the
Depository, Depository Participants and indirect participating firms as
representatives of the Certificate Owners of the Book-Entry Certificates for
purposes of exercising the rights of holders under this 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
(vi) the Trustee may rely and shall be fully protected in relying upon
information furnished by the Depository with respect to its Depository
Participants and furnished by the Depository Participants with respect to
indirect participating firms and persons shown on the books of such indirect
participating firms as direct or indirect Certificate Owners.
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 Owner. 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.
If (x) (i) the Depository or the Depositor advises the Trustee in
writing that the Depository is no longer willing or able to properly discharge
its responsibilities as Depository, and (ii) the Trustee or the Depositor is
unable to locate a qualified successor, (y) the Depositor at its option advises
the Trustee in writing that it elects to terminate the book-entry system through
the Depository or (z) after the occurrence of an Event of Default, Certificate
Owners representing at least 51% of the Certificate Balance of the Book-Entry
Certificates together advise the Trustee and the Depository through the
Depository Participants in writing that the continuation of a book-entry system
through the Depository is no longer in the best interests of the Certificate
Owners, the Trustee 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 of the related Class
of Certificates by the Depository, accompanied by the instructions from the
Depository for registration, the Trustee shall issue the Definitive
Certificates. Neither the Servicers, the Depositor nor the Trustee shall be
liable for any delay in delivery of such instruction and each may conclusively
rely on, and shall be protected in relying on, such instructions. The Depositor
shall provide the Trustee with an adequate inventory of Certificates to
facilitate the issuance and transfer of Definitive Certificates. Upon the
issuance of Definitive Certificates all references herein to obligations imposed
upon or to be performed by the Depository shall be deemed to be imposed upon and
performed by the Trustee, to the extent applicable with respect to such
Definitive Certificates and the Trustee shall recognize the Holders of the
Definitive Certificates as Certificateholders hereunder; provided that the
Trustee shall not by virtue of its assumption of such obligations become liable
to any party for any act or failure to act of the Depository.
Section 5.03 Mutilated, Destroyed, Lost or Stolen Certificates.
If (a) any mutilated Certificate is surrendered to the Trustee, or
the Trustee receives evidence to its satisfaction of the destruction, loss or
theft of any Certificate and (b) there is delivered to the Depositor, the
Servicers and the Trustee such security or indemnity as may be required by them
to hold each of them harmless, then, in the absence of notice to the Trustee
that such Certificate has been acquired by a bona fide purchaser, the Trustee
shall execute, countersign and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Certificate, a new Certificate of like
Class, tenor and Percentage Interest. In connection with the issuance of any new
Certificate under this Section 5.03, the Trustee may require the payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in relation thereto and any other expenses (including the fees and expenses of
the Trustee) connected therewith. Any replacement Certificate issued pursuant to
this Section 5.03 shall constitute complete and indefeasible evidence of
ownership, as if originally issued, whether or not the lost, stolen or destroyed
Certificate shall be found at any time.
Section 5.04 Persons Deemed Owners.
The Servicers, the Trustee, the Depositor and any agent of a
Servicer, the Depositor or the Trustee may treat the Person in whose name any
Certificate is registered as the owner of such Certificate for the purpose of
receiving distributions as provided in this Agreement and for all other purposes
whatsoever, and neither the Servicers, the Trustee, the Depositor nor any agent
of a Servicer, the Depositor or the Trustee shall be affected by any notice to
the contrary.
Section 5.05 Access to List of Certificateholders' Names
and Addresses.
If three or more Certificateholders (a) request such information in
writing from the Trustee, (b) state that such Certificateholders desire to
communicate with other Certificateholders with respect to their rights under
this Agreement or under the Certificates, and (c) provide a copy of the
communication which such Certificateholders propose to transmit, or if the
Depositor or a Servicer shall request such information in writing from the
Trustee, then the Trustee shall, within ten Business Days after the receipt of
such request, provide the Depositor, such Servicer or such Certificateholders at
such recipients' expense the most recent list of the Certificateholders of such
Trust Fund held by the Trustee, if any. The Depositor and every
Certificateholder, by receiving and holding a Certificate, agree that the
Trustee shall not be held accountable by reason of the disclosure of any such
information as to the list of the Certificateholders hereunder, regardless of
the source from which such information was derived.
Section 5.06 Maintenance of Office or Agency.
The Trustee will maintain or cause to be maintained at its expense
an office or offices or agency or agencies in New York City where Certificates
may be surrendered for registration of transfer or exchange. The Trustee
initially designates its agent's offices for such purposes located at DTC
Transfer Agent Services, 00 Xxxxx Xxxxxx, Xxxxxxxx Xxxx Xxxxxxxx, Xxx Xxxx, Xxx
Xxxx 00000. The Trustee will give prompt written notice to the
Certificateholders of any change in such location of any such office or agency.
ARTICLE VI
THE DEPOSITOR AND THE SERVICERS
Section 6.01 Respective Liabilities of the Depositor and
the Servicers.
The Depositor and the Servicers shall each be liable in accordance
herewith only to the extent of the obligations specifically and respectively
imposed upon and undertaken by them herein.
Section 6.02 Merger or Consolidation of the Depositor
or a Servicer.
The Depositor and the Servicers will each keep in full effect its
existence, rights and franchises as a corporation or federally chartered savings
bank, as the case may be, under the laws of the United States or under the laws
of one of the states thereof and will each 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, or any of the Mortgage Loans and to perform
its respective duties under this Agreement.
Any Person into which the Depositor or a Servicer may be merged or
consolidated, or any Person resulting from any merger or consolidation to which
the Depositor or a Servicer shall be a party, or any person succeeding to the
business of the Depositor or a Servicer, shall be the successor of the Depositor
or such Servicer, as the case may be, hereunder, without the execution or filing
of any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding; provided, however, that the
successor or surviving Person to such Servicer shall be qualified to sell
mortgage loans to, and to service mortgage loans on behalf of, Xxxxxx Mae or
FHLMC.
Section 6.03 Limitation on Liability of the Depositor, the Servicers
and Others.
Neither the Depositor, the Servicers nor any of their directors,
officers, employees or agents of the Depositor shall be under any liability to
the Certificateholders for any action taken or for refraining from the taking of
any action in good faith pursuant to this Agreement, or for errors in judgment;
provided, however, that this provision shall not protect the Depositor, the
Servicers or any such Person against any breach of representations or warranties
made by it herein or protect the Depositor or any such Person from any liability
which would otherwise be imposed by reasons of willful misfeasance, bad faith or
gross negligence in the performance of duties or by reason of reckless disregard
of obligations and duties hereunder. The Depositor and any director, officer,
employee or agent of the Depositor may rely in good faith on any document of any
kind prima facie properly executed and submitted by any Person respecting any
matters arising hereunder. The Depositor and any director, officer, employee or
agent of the Depositor shall be indemnified by the Trust Fund and held harmless
against any loss, liability or expense incurred in connection with any audit,
controversy or judicial proceeding relating to a governmental taxing authority
or any legal action relating to this Agreement or the Certificates, other than
any loss, liability or expense related to any specific Mortgage Loan or Mortgage
Loans (except as any such loss, liability or expense shall be otherwise
reimbursable pursuant to this Agreement) and any loss, liability or expense
incurred by reason of willful misfeasance, bad faith or gross negligence in the
performance of duties hereunder or by reason of reckless disregard of
obligations and duties hereunder. The Depositor shall not be under any
obligation to appear in, prosecute or defend any legal action that is not
incidental to its respective duties hereunder and which in its opinion may
involve it in any expense or liability; provided, however, that the Depositor
may in its discretion undertake any such action (or direct the Trustee to
undertake any such actions pursuant to Section 2.03 hereof for the benefit of
Certificateholders) that it may deem necessary or desirable in respect of this
Agreement and the rights and duties of the parties hereto and interests of the
Trustee and the Certificateholders hereunder. In such event, the legal expenses
and costs of such action and any liability resulting therefrom shall be
expenses, costs and liabilities of the Trust Fund, and the Depositor shall be
entitled to be reimbursed therefor out of the Collection Accounts.
Neither the Servicers nor any of the officers, employees or agents
of the Servicers shall be under any liability to the Trustee or the Depositor
for any action taken or for refraining from the taking of any action in good
faith pursuant to this Agreement; provided, however, that this provision shall
not protect a Servicer or any such person against any breach of warranties or
representations made herein, or failure to perform its obligations in strict
compliance with the terms of this Agreement, or any liability which would
otherwise be imposed by reason of any breach of the terms and conditions of this
Agreement. The Servicers and any officer, employee or agent of the Servicers 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
Servicer shall be under any obligation to appear in, prosecute or defend any
legal action which is not incidental to its duties to service the Mortgage Loans
in accordance with this Agreement and which in its opinion may involve it in any
expenses or liability; provided, however, that a Servicer may undertake any such
action which it may deem necessary or desirable in 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 of the Trust Fund, and the applicable Servicer
shall be entitled to be reimbursed therefor out of the related Collection
Account.
Section 6.04 Limitation on Resignation of a Servicer.
Neither Servicer shall assign this Agreement or resign from the
obligations and duties hereby imposed on it except by mutual consent of the
Servicers, the Depositor and the Trustee or upon the determination that its
duties hereunder are no longer permissible under applicable law and such
incapacity cannot be cured by such Servicer. Any such determination permitting
the resignation of a Servicer shall be evidenced by an Opinion of Counsel to
such effect delivered to the Depositor and the Trustee which Opinion of Counsel
shall be in form and substance acceptable to the Depositor and the Trustee. No
such resignation shall become effective until a successor shall have assumed
such Servicer's responsibilities and obligations hereunder.
Section 6.05 Additional Indemnification by the Servicers;
Third Party Claims.
Each Servicer shall indemnify the Depositor and the Trustee and hold
them harmless against any and all claims, losses, damages, penalties, fines,
forfeitures, reasonable and necessary legal fees and related costs, judgments,
and any other costs, fees and expenses that any of them may sustain in any way
related to any breach by such Servicer, of any of its representations and
warranties referred to in Section 2.09 or the failure of such Servicer to
perform its duties and service the Mortgage Loans in strict compliance with the
terms of this Agreement. The applicable Servicer immediately shall 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 prior written 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 or
the Depositor or the Trustee in respect of such claim.
ARTICLE VII
DEFAULT
Section 7.01 Events of Default.
"Event of Default," wherever used herein, means any one of the
following events with respect to a particular Servicer:
(a) any failure by a Servicer to remit to the Trustee any payment
required to be made under the terms of this Agreement which continues unremedied
for a period of one Business Day after the date upon which written notice of
such failure, requiring the same to be remedied, shall have been given to such
Servicer by the Depositor or the Trustee or to the Servicers, the Depositor and
the Trustee by Certificateholders evidencing percentage interests of at least
25% in the Certificates; or
(b) failure on the part of a Servicer duly to observe or perform
in any material respect any other of the covenants or agreements on the part of
such Servicer set forth in this Agreement which continues unremedied for a
period of forty-five days (except that such number of days shall be fifteen in
the case of a failure to pay any premium for any insurance policy required to be
maintained under this Agreement) after the earlier of (i) the date on which
written notice of such failure, requiring the same to be remedied, shall have
been given to such Servicer by the Depositor or the Trustee, or to the
Servicers, the Depositor and the Trustee by Certificateholders of Certificates
evidencing percentage interests of at least 25% in the Certificates and (ii)
actual knowledge of such failure by a Servicing Officer of such Servicer; or
(c) 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, bankruptcy, 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 a Servicer and such
decree or order shall have remained in force undischarged or unstayed for a
period of sixty days; or
(d) a Servicer shall consent to the appointment of a conservator
or receiver or liquidator in any insolvency, bankruptcy, readjustment of debt,
marshalling of assets and liabilities or similar proceedings of or relating to a
Servicer or of or relating to all or substantially all of its property; or
(e) a Servicer shall admit in writing its inability to pay its
debts generally as they become due, file a petition to take advantage of any
applicable insolvency or reorganization statute, make an assignment for the
benefit of its creditors, or voluntarily suspend payment of its obligations; or
(f) any failure of a Servicer to make any P&I Advance on any
Remittance Date required to be made from its own funds pursuant to Section 4.01
which continues unremedied for one Business Day immediately following the
Remittance Date; or
(g) A breach of any representation and warranty of a Servicer
referred to in Section 2.09, which materially and adversely affects the
interests of the Certificateholders and which continues unremedied for a period
of thirty days after the date upon which written notice of such breach is given
to such Servicer by the Trustee or the Depositor, or to the Servicers, the
Trustee and the Depositor by Certificateholders entitled to at least 25% of the
Voting Rights in the Certificates; or
(h) Any failure by a Servicer of the Servicer Termination Test.
If an Event of Default described in clauses (a) through (h) of this
Section 7.01 shall occur, then, and in each and every such case, so long as such
event shall not have been remedied, the Trustee may, and at the direction of 51%
of the Voting Rights, the Trustee shall, by notice in writing to a Servicer
(with a copy to each Rating Agency), terminate all of the rights and obligations
of such Servicer under this Agreement and in and to the Mortgage Loans and the
proceeds thereof, other than its rights as a Certificateholder hereunder;
provided however, that the Trustee shall not be required to give written notice
to such Servicer of the occurrence of an Event of Default described in clauses
(b) through (h) of this Section 7.01 unless and until a Responsible Officer of
the Trustee has actual knowledge of the occurrence of such an event. On and
after the receipt by such Servicer of such written notice, all authority and
power of such Servicer hereunder, whether with respect to the Mortgage Loans or
otherwise, shall pass to and be vested in the Trustee. The Trustee is hereby
authorized and empowered to execute and deliver, on behalf of such Servicer, as
attorney-in-fact or otherwise, any and all documents and other instruments, and
to do or accomplish all other acts or things necessary or appropriate to effect
the purposes of such notice of termination, whether to complete the transfer and
endorsement or assignment of the Mortgage Loans and related documents, or
otherwise. Unless expressly provided in such written notice, no such termination
shall affect any obligation of such Servicer to pay amounts owed pursuant to
Article VIII. Such Servicer agrees to cooperate with the Trustee in effecting
the termination of such Servicer's responsibilities and rights hereunder,
including, without limitation, the transfer to the Trustee of all cash amounts
which shall at the time be credited to the Collection Account of such
predecessor Servicer, or thereafter be received with respect to the Mortgage
Loans.
Notwithstanding any termination of the activities of a Servicer
hereunder, the Servicer shall be entitled to receive, prior to transfer of its
servicing obligations hereunder, payment of all accrued and unpaid Servicing
Fees and reimbursement for all outstanding P&I Advances and Servicing Advances.
Section 7.02 Trustee to Act; Appointment of Successor.
On and after the time a Servicer receives a notice of termination
pursuant to Section 3.24 or Section 7.01, the Trustee shall, subject to and to
the extent provided in Section 3.05, be the successor to such Servicer in its
capacity as servicer under this Agreement and the transactions set forth or
provided for herein and shall be subject to all the responsibilities, duties and
liabilities relating thereto placed on such Servicer by the terms and provisions
hereof and applicable law including the obligation to make P&I Advances or
Servicing Advances pursuant to Section 4.01. As compensation therefor, the
Trustee shall be entitled to all funds relating to the Mortgage Loans that such
Servicer would have been entitled to charge to its Collection Account if such
Servicer had continued to act hereunder including, if such Servicer was
receiving the Servicing Fee, the Servicing Fee and the income on investments or
gain related to its Collection Account (in addition to income on investments or
gain related to the Distribution Account for the benefit of the Trustee).
Notwithstanding the foregoing, if the Trustee has become the successor to a
Servicer in accordance with Section 7.01, the Trustee may, if it shall be
unwilling to so act, or shall, if it is prohibited by applicable law from making
P&I Advances and Servicing Advances pursuant to Section 4.01 or if it is
otherwise unable to so act, appoint, or petition a court of competent
jurisdiction to appoint, any established mortgage loan servicing institution the
appointment of which does not adversely affect the then current rating of the
Certificates by each Rating Agency, as the successor to such Servicer hereunder
in the assumption of all or any part of the responsibilities, duties or
liabilities of such Servicer hereunder. Any successor to such Servicer shall be
an institution which is a Xxxxxx Xxx and FHLMC approved seller/servicer in good
standing, which has a net worth of at least $30,000,000, which is willing to
service the Mortgage Loans and which executes and delivers to the Depositor and
the Trustee an agreement accepting such delegation and assignment, containing an
assumption by such Person of the rights, powers, duties, responsibilities,
obligations and liabilities of such Servicer (other than liabilities of such
Servicer under Section 6.03 incurred prior to termination of the Servicer under
Section 7.01), with like effect as if originally named as a party to this
Agreement; provided that each Rating Agency acknowledges that its rating of the
Certificates in effect immediately prior to such assignment and delegation will
not be qualified or reduced, as a result of such assignment and delegation.
Pending appointment of a successor to a Servicer hereunder, the Trustee, unless
the Trustee is prohibited by law from so acting, shall, subject to Section 3.05,
act in such capacity as hereinabove provided. In connection with 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; provided, however, that no such compensation shall be in
excess of the Servicing Fee Rate and amounts paid to such Servicer from
investments. The Trustee and such successor shall take such action, consistent
with this Agreement, as shall be necessary to effectuate any such succession.
Neither the Trustee nor any other successor servicer shall be deemed to be in
default hereunder by reason of any failure to make, or any delay in making, any
distribution hereunder or any portion thereof or any failure to perform, or any
delay in performing, any duties or responsibilities hereunder, in either case
caused by the failure of a Servicer to deliver or provide, or any delay in
delivering or providing, any cash, information, documents or records to it.
Any successor to a Servicer as servicer shall give notice to the
Mortgagors of such change of servicer and shall, during the term of its service
as servicer, maintain in force the policy or policies that each Servicer is
required to maintain pursuant to Section 6.05.
Section 7.03 Notification to Certificateholders.
(a) Upon any termination of or appointment of a successor to a
Servicer, the Trustee shall give prompt written notice thereof to
Certificateholders and to each Rating Agency.
(b) Within 60 days after the occurrence of any Event of Default,
the Trustee shall transmit by mail to all Certificateholders and each Rating
Agency notice of each such Event of Default hereunder known to the Trustee,
unless such event shall have been cured or waived.
ARTICLE VIII
CONCERNING THE TRUSTEE
Section 8.01 Duties of the Trustee.
The Trustee, before the occurrence of an Event of Default and after
the curing of all Events of Default that may have occurred, shall undertake to
perform such duties and only such duties as are specifically set forth in this
Agreement. In case an Event of Default has occurred and remains uncured, the
Trustee shall exercise such of the rights and powers vested in it by this
Agreement, and use the same degree of care and skill in their exercise as a
prudent person would exercise or use under the circumstances in the conduct of
such person's own affairs.
The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments furnished
to the Trustee that are specifically required to be furnished pursuant to any
provision of this Agreement shall examine them to determine whether they are in
the form required by this Agreement. The Trustee shall not be responsible for
the accuracy or content of any resolution, certificate, statement, opinion,
report, document, order, or other instrument.
No provision of this Agreement shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own willful misconduct.
Unless an Event of Default known to the Trustee has occurred and is
continuing,
(a) 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 the duties and obligations specifically set
forth in this Agreement, no implied covenants or obligations shall be read into
this Agreement against the Trustee, and 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 which it believed in good faith
to be genuine and to have been duly executed by the proper authorities
respecting any matters arising hereunder;
(b) 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 is finally proven that the Trustee was negligent in ascertaining the
pertinent facts; and
(c) 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 Holders of Certificates evidencing not less than 25% of the
Voting Rights of Certificates relating to the time, method, and place of
conducting any proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred upon the Trustee under this Agreement.
Section 8.02 Certain Matters Affecting the Trustee.
Except as otherwise provided in Section 8.01:
(a) the Trustee may request and rely upon and shall be protected
in acting or refraining from acting upon any resolution, Officer's Certificate,
certificate of auditors or any other certificate, statement, instrument,
opinion, report, notice, request, consent, order, appraisal, bond or other paper
or document believed by it to be genuine and to have been signed or presented by
the proper party or parties and the Trustee shall have no responsibility to
ascertain or confirm the genuineness of any signature of any such party or
parties;
(b) the Trustee may consult with counsel, financial advisers or
accountants and the advice of any such counsel, financial advisers or
accountants and any Opinion of Counsel shall be full and complete authorization
and protection in respect of any action taken or suffered or omitted by it
hereunder in good faith and in accordance with such Opinion of Counsel;
(c) the Trustee shall not be liable for any action taken, suffered
or omitted by it in good faith and believed by it to be authorized or within the
discretion or rights or powers conferred upon it by this Agreement;
(d) 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 so to do by Holders of
Certificates evidencing not less than 25% of the Voting Rights allocated to each
Class of Certificates;
(e) the Trustee may execute any of the trusts or powers hereunder
or perform any duties hereunder either directly or by or through agents,
accountants or attorneys and the Trustee shall not be responsible for any
misconduct or negligence on the part of any agents, accountants or attorneys
appointed with due care by it hereunder;
(f) the Trustee shall not be required to risk or expend its own
funds or otherwise incur any financial liability in the performance of any of
its duties or in the exercise of any of its rights or powers hereunder if it
shall have reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability is not assured to it;
(g) the Trustee shall not be liable for any loss on any investment
of funds pursuant to this Agreement (other than as issuer of the investment
security and with respect to investment of funds in the Distribution Account);
(h) the Trustee shall not be deemed to have knowledge of an Event
of Default until a Responsible Officer of the Trustee shall have received
written notice thereof; and
(i) the Trustee shall be under no obligation to exercise any of
the trusts, rights or powers vested in it by this Agreement or to institute,
conduct or defend any litigation hereunder or in relation hereto at the request,
order or direction of any of the Certificateholders, pursuant to this Agreement,
unless such Certificateholders shall have offered to the Trustee reasonable
security or indemnity satisfactory to the Trustee against the costs, expenses
and liabilities which may be incurred therein or thereby.
Section 8.03 Trustee Not Liable for Certificates or Mortgage
Loans.
The recitals contained herein and in the Certificates shall be taken
as the statements of the Depositor and the Trustee assumes no responsibility for
their correctness. The Trustee makes no representations as to the validity or
sufficiency of this Agreement or of the Certificates or of any Mortgage Loan or
related document other than with respect to the Trustee's execution and
countersignature of the Certificates. The Trustee shall not be accountable for
the use or application by the Depositor or a Servicer of any funds paid to the
Depositor or a Servicer in respect of the Mortgage Loans or deposited in or
withdrawn from any Collection Account by the Depositor or a Servicer.
The Trustee shall have no responsibility for filing or recording any
financing or continuation statement in any public office at any time or to
otherwise perfect or maintain the perfection of any security interest or lien
granted to it hereunder (unless the Trustee shall have become the successor
Servicer).
The Trustee executes the Certificates not in its individual capacity
but solely as Trustee of the Trust Fund created by this Agreement, in the
exercise of the powers and authority conferred and vested in it by this
Agreement. Each of the undertakings and agreements made on the part of the
Trustee on behalf of the Trust Fund in the Certificates is made and intended not
as a personal undertaking or agreement by the Trustee but is made and intended
for the purpose of binding only the Trust Fund.
Section 8.04 Trustee May Own Certificates.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Certificates with the same rights as it would have if it
were not the Trustee.
Section 8.05 Trustee's Fees and Expenses; Custodial Fees.
As compensation for its activities under this Agreement, the Trustee
may withdraw from the Distribution Account on each Distribution Date the Trustee
Fee for the Distribution Date and any interest or investment income earned on
funds deposited in the Distribution Account. The Trustee and any director,
officer, employee, or agent of the Trustee shall be indemnified by each Servicer
(on a pro rata basis, unless relating to actions or omissions of a particular
Servicer) against any loss, liability, or expense (including reasonable
attorney's fees) resulting from any error in any tax or information return
prepared by such Servicer or incurred in connection with any claim or legal
action relating to
(a) this Agreement,
(b) the Certificates, or
(c) the performance of any of the Trustee's duties under this
Agreement,
(A) other than any loss, liability, or expense incurred because of
willful misfeasance, bad faith, or negligence in the performance of any of the
Trustee's duties under this Agreement provided, however, that no Servicer shall
have any responsibility to indemnify the Trustee for any loss, liability or
expense resulting from the failure of the other Servicer to perform its
obligations under this Agreement. This indemnity shall survive the termination
of this Agreement or the resignation or removal of the Trustee under this
Agreement.
Except as otherwise provided in this Agreement or a separate letter
agreement between the Trustee and the Depositor, the Trustee shall not be
entitled to payment or reimbursement for any routine ongoing expenses incurred
by the Trustee in the ordinary course of its duties as Trustee, Registrar, or
Paying Agent under this Agreement or for any other expenses.
The Trustee shall withdraw from the Distribution Account on each
Distribution Date the Custodial Fee for such Distribution Date and remit the
Custodial Fee to the Custodian as compensation for the Custodian's activities
under this Agreement.
Section 8.06 Eligibility Requirements for the Trustee.
The Trustee hereunder shall at all times be a corporation or
association organized and doing business under the laws of a 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, subject
to supervision or examination by federal or state authority and with a credit
rating which would not cause any of the Rating Agencies to reduce their
respective then current ratings of the Certificates (or having provided such
security from time to time as is sufficient to avoid such reduction) as
evidenced in writing by each Rating Agency. If such corporation or association
publishes reports of condition at least annually, pursuant to law or to the
requirements of the aforesaid supervising or examining authority, then for the
purposes of this Section 8.06 the combined capital and surplus of such
corporation or association shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. In
case at any time the Trustee shall cease to be eligible in accordance with this
Section 8.06, the Trustee shall resign immediately in the manner and with the
effect specified in Section 8.07. The entity serving as Trustee may have normal
banking and trust relationships with the Depositor and its affiliates or the
Servicers and their affiliates; provided, however, that such entity cannot be an
affiliate of the Depositor or the Servicers other than the Trustee in its role
as successor to the Servicer.
Section 8.07 Resignation and Removal of the Trustee.
The Trustee may at any time resign and be discharged from the trusts
hereby created by giving written notice of resignation to the Depositor, the
Servicers, each Rating Agency not less than 60 days before the date specified in
such notice, when, subject to Section 8.08, such resignation is to take effect,
and acceptance by a successor trustee in accordance with Section 8.08 meeting
the qualifications set forth in Section 8.06. If no successor trustee meeting
such qualifications shall have been so appointed and have accepted appointment
within 30 days after the giving of such notice or 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 Section 8.06 and shall fail to resign after written request thereto by the
Depositor, or if at any time the Trustee shall become incapable of acting, or
shall be adjudged as 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, or a tax is imposed with respect to
the Trust Fund by any state in which the Trustee or the Trust Fund is located
and the imposition of such tax would be avoided by the appointment of a
different trustee, then the Depositor or the Servicer may remove the Trustee and
appoint a successor trustee by written instrument, in triplicate, one copy of
which shall be delivered to the Trustee, one copy to each Servicer and one copy
to the successor trustee.
The Holders of Certificates entitled to at least 51% of the Voting
Rights 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 shall be
delivered by the successor Trustee to each Servicer, one complete set to the
Trustee so removed and one complete set to the successor so appointed. The
successor trustee shall notify each Rating Agency of any removal of the Trustee.
Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to this Section 8.07 shall become effective upon
acceptance of appointment by the successor trustee as provided in Section 8.08.
Section 8.08 Successor Trustee.
Any successor trustee appointed as provided in Section 8.07 shall
execute, acknowledge and deliver to the Depositor and to its predecessor trustee
and the Servicers an instrument accepting such appointment hereunder and
thereupon the resignation or removal of the predecessor trustee shall become
effective and such successor trustee, without any further act, deed or
conveyance, shall become fully vested with all the rights, powers, duties and
obligations of its predecessor hereunder, with the like effect as if originally
named as trustee herein. The Depositor, the Servicers 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.
No successor trustee shall accept appointment as provided in this
Section 8.08 unless at the time of its acceptance, the successor trustee is
eligible under Section 8.06 and its appointment does not adversely affect the
then current rating of the Certificates.
Upon acceptance of appointment by a successor trustee as provided in
this Section 8.08, the Depositor shall mail notice of the succession of such
trustee hereunder to all Holders of Certificates. 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 8.09 Merger or Consolidation of the Trustee.
Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to the business of the Trustee, shall be the successor of
the Trustee hereunder, provided that such corporation shall be eligible under
Section 8.06 without the execution or filing of any paper or further act on the
part of any of the parties hereto, anything herein to the contrary
notwithstanding.
Section 8.10 Appointment of Co-Trustee or Separate Trustee.
Notwithstanding any other provisions of this Agreement, at any time,
for the purpose of meeting any legal requirements of any jurisdiction in which
any part of the Trust Fund or property securing any Mortgage Note may at the
time be located, the applicable Servicer and the Trustee acting jointly shall
have the power and shall execute and deliver all instruments to appoint one or
more Persons approved by the Trustee to act as co-trustee or co-trustees jointly
with the Trustee, or separate trustee or separate trustees, of all or any part
of the Trust Fund, and to vest in such Person or Persons, in such capacity and
for the benefit of the Certificateholders, such title to the Trust Fund or any
part thereof, whichever is applicable, and, subject to the other provisions of
this Section 8.10, such powers, duties, obligations, rights and trusts as the
applicable Servicer and the Trustee may consider appropriate. If either Servicer
shall not have joined in such appointment within 15 days after the receipt by
such Servicer of a request to do so or in the 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 8.06 and
no notice to Certificateholders of the appointment of any co-trustee or separate
trustee shall be required under Section 8.08.
Every separate trustee and co-trustee shall, to the extent permitted
by law, be appointed and act subject to the following provisions and conditions:
(a) To the extent necessary to effectuate the purposes of this
Section 8.10, all rights, powers, duties and obligations conferred or imposed
upon the Trustee, except for the obligation of the Trustee under this Agreement
to advance funds on behalf of a Servicer, shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or co-trustee
jointly (it being understood that such separate trustee or co-trustee is not
authorized to act separately without the Trustee joining in such act), except to
the extent that under any law of any jurisdiction in which any particular act or
acts are to be performed (whether as Trustee hereunder or as successor to a
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 applicable Trust Fund or any portion
thereof in any such jurisdiction) shall be exercised and performed singly by
such separate trustee or co-trustee, but solely at the direction of the Trustee;
(b) No trustee hereunder shall be held personally liable because
of any act or omission of any other trustee hereunder and such appointment shall
not, and shall not be deemed to, constitute any such separate trustee or
co-trustee as agent of the Trustee;
(c) The Trustee may at any time accept the resignation of or remove
any separate trustee or co-trustee; and
(d) The Servicers, and not the Trustee, shall be jointly and
severally liable for the payment of reasonable compensation, reimbursement and
indemnification to any such separate trustee or co-trustee.
Any notice, request or other writing given to the Trustee shall be
deemed to have been given to each of the separate trustees and co-trustees, when
and as effectively as if given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Agreement and the conditions
of this Article VIII. Each separate trustee and co-trustee, upon its acceptance
of the trusts conferred, shall be vested with the estates or property specified
in its instrument of appointment, either jointly with the Trustee or separately,
as may be provided therein, subject to all the provisions of this Agreement,
specifically including every provision of this Agreement relating to the conduct
of, affecting the liability of, or affording protection to, the Trustee. Every
such instrument shall be filed with the Trustee and a copy thereof given to the
Servicers and the Depositor.
Any separate trustee or co-trustee may, at any time, constitute the
Trustee its agent or attorney-in-fact, with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee, to the extent permitted by law, without the appointment of a new or
successor trustee.
Section 8.11 Tax Matters.
It is intended that the assets with respect to which any REMIC
election pertaining to the Trust Fund is to be made, as set forth in the
Preliminary Statement, shall constitute, and that the conduct of matters
relating to such assets shall be such as to qualify such assets as, a "real
estate mortgage investment conduit" as defined in and in accordance with the
REMIC Provisions. In furtherance of such intention, the Trustee covenants and
agrees that it shall act as agent (and the Trustee is hereby appointed to act as
agent) on behalf of any the REMIC and that in such capacity it shall:
(a) prepare and file in a timely manner, a U.S. Real Estate
Mortgage Investment Conduit Income Tax Return (Form 1066 or any successor form
adopted by the Internal Revenue Service) and prepare and file with the Internal
Revenue Service and applicable state or local tax authorities income tax or
information returns for each taxable year with respect to any REMIC, described
in the Preliminary Statement 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 furnish to Certificateholders the schedules,
statements or information at such times and in such manner as may be required
thereby;
(b) within thirty days of the Closing Date, furnish 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,
together with such additional information as may be required by such Form, and
update such information at the time or times in the manner required by the Code;
(c) make an election that each of the Lower Tier REMIC and the
Upper Tier REMIC be treated as a REMIC on the federal tax return for its first
taxable year (and, if necessary, under applicable state law);
(d) prepare and forward to the Certificateholders and to the
Internal Revenue Service and, if necessary, state tax authorities, all
information returns and reports as and when required to be provided to them in
accordance with the REMIC Provisions, including the calculation of any original
issue discount using the Prepayment Assumption (as defined in the Prospectus
Supplement);
(e) provide information necessary for the computation of tax
imposed on the transfer of a Residual Certificate to a Person that is not a
Permitted Transferee, or an agent (including a broker, nominee or other
middleman) of a Non-Permitted Transferee, or a pass-through entity in which a
Non-Permitted Transferee is the record holder of an interest (the reasonable
cost of computing and furnishing such information may be charged to the Person
liable for such tax);
(f) to the extent that they are under its control, conduct matters
relating to such assets at all times that any Certificates are outstanding so as
to maintain the status as a REMIC under the REMIC Provisions;
(g) not knowingly or intentionally take any action or omit to take
any action that would cause the termination of the REMIC status of any REMIC
created hereunder;
(h) pay, from the sources specified in the last paragraph of this
Section 8.11, the amount of any federal or state tax, including prohibited
transaction taxes as described below, imposed on any REMIC created hereunder
before its termination when and as the same shall be due and payable (but such
obligation shall not prevent the Trustee or any other appropriate Person from
contesting any such tax in appropriate proceedings and shall not prevent the
Trustee from withholding payment of such tax, if permitted by law, pending the
outcome of such proceedings);
(i) cause federal, state or local income tax or information
returns to be signed by the Trustee or such other person as may be required to
sign such returns by the Code or state or local laws, regulations or rules;
(j) maintain records relating to each REMIC created hereunder,
including the income, expenses, assets, and liabilities thereof on a calendar
year basis and on the accrual method of accounting and the fair market value and
adjusted basis of the assets determined at such intervals as may be required by
the Code, as may be necessary to prepare the foregoing returns, schedules,
statements or information; and
(k) as and when necessary and appropriate, represent each REMIC
created hereunder in any administrative or judicial proceedings relating to an
examination or audit by any governmental taxing authority, request an
administrative adjustment as to any taxable year of each REMIC created
hereunder, enter into settlement agreements with any governmental taxing agency,
extend any statute of limitations relating to any tax item of any REMIC created
hereunder, and otherwise act on behalf of the REMIC in relation to any tax
matter or controversy involving it.
The Trustee shall treat the rights of the Class P Certificateholders
to Prepayment Charges and the rights of the Floating Rate Certificateholders to
receive Basis Risk CarryForward Amounts as the beneficial ownership of interests
in a grantor trust, and not as an obligation of any REMIC created hereunder, for
federal income tax purposes.
To enable the Trustee to perform its duties under this Agreement,
the Depositor shall provide to the Trustee within ten days after the Closing
Date all information or data that the Trustee requests in writing and determines
to be relevant for tax purposes to the valuations and offering prices of the
Certificates, including the price, yield, prepayment assumption, and projected
cash flows of the Certificates and the Mortgage Loans. Moreover, the Depositor
shall provide information to the Trustee concerning the value to each Class of
Certificates of the right to receive Basis Risk CarryForward Amounts from the
Excess Reserve Fund Account. Thereafter, the Depositor shall provide to the
Trustee promptly upon written request therefor any additional information or
data that the Trustee may, from time to time, reasonably request to enable the
Trustee to perform its duties under this Agreement. The Depositor hereby
indemnifies the Trustee for any losses, liabilities, damages, claims, or
expenses of the Trustee arising from any errors or miscalculations of the
Trustee that result from any failure of the Depositor to provide, or to cause to
be provided, accurate information or data to the Trustee on a timely basis.
If any tax is imposed on "prohibited transactions" of any REMIC
created hereunder as defined in Section 860F(a)(2) of the Code, on the "net
income from foreclosure property" of such REMIC as defined in Section 860G(c) of
the Code, on any contribution to the REMIC after the Startup Day pursuant to
Section 860G(d) of the Code, or any other tax is imposed, including any minimum
tax imposed on the REMIC pursuant to Sections 23153 and 24874 of the California
Revenue and Taxation Code, if not paid as otherwise provided for herein, the tax
shall be paid by (i) the Trustee if such tax arises out of or results from
negligence of the Trustee in the performance of any of its obligations under
this Agreement, (ii) the applicable Servicer, in the case of any such minimum
tax, and otherwise if such tax arises out of or results from a breach by the
Servicer of any of its obligations under this Agreement, or (iii) in all other
cases, or if the Trustee or the applicable Servicer fails to honor its
obligations under the preceding clauses (i), (ii) or (iii), any such tax will be
paid with amounts otherwise to be distributed to the Certificateholders, as
provided in Section 4.02(a).
Section 8.12 Periodic Filings.
Pursuant to written instructions from the Depositor, the Trustee
shall prepare, execute and file all periodic reports required under the
Securities Exchange Act of 1934 in conformity with the terms of the relief
granted to issuers similar to the Trust Fund. In connection with the preparation
and filing of such periodic reports, the Depositor and the Servicers shall
timely provide to the Trustee all material information available to them which
is required to be included in such reports and not known to them to be in the
possession of the Trustee and such other information as the Trustee reasonably
may request from either of them and otherwise reasonably shall cooperate with
the Trustee. The Trustee shall have no liability with respect to any failure to
properly prepare or file such periodic reports resulting from or relating to the
Trustee's inability or failure to obtain any information not resulting from its
own negligence or willful misconduct.
Section 8.13 Tax Classification of the Excess Reserve Fund
Account.
For federal income tax purposes, the Trustee shall treat the Excess
Reserve Fund Account as an outside reserve fund, within the meaning of Treasury
Regulations Section 1.860-2(h), that is beneficially owned by the holder of the
Class X Certificate. The Trustee shall treat the rights that each Class of
Certificates has to receive payments of Basis Risk CarryForward Amounts from the
Excess Reserve Fund Account as rights to receive payments under an interest rate
cap contract written by the Class X Certificateholder in favor of each Class.
Accordingly, each Class of Certificates (excluding the Class X, Class P and
Class R Certificates) will comprise two components - an Upper Tier Regular
Interest and an interest in a cap contract. The Trustee shall allocate the issue
price for a Class of Certificates between two components for purposes of
determining the issue price of the Upper Tier Regular Interest component based
on information received from the Depositor.
Section 8.14 Appointment of Custodian.
The Trustee may at any time on or after the Closing Date, with the
consent of the Depositor, appoint one or more Custodians to hold all or a
portion of the Custodial Files as agent for the Trustee, by entering into a
custodial agreement in a form acceptable to the Depositor. Subject to this
Article VIII, the Trustee agrees to comply with the terms of each Custodial
Agreement and to enforce the terms and provisions thereof against the Custodian
for the benefit of the Certificateholders. Each Custodian shall be a depository
institution subject to supervision by federal or state authority, shall have a
combined capital and surplus of at least $10,000,000 and shall be qualified to
do business in the jurisdiction in which it holds any Custodial File.
ARTICLE IX
TERMINATION
Section 9.01 Termination upon Liquidation or Purchase of the
Mortgage Loans.
Subject to Section 9.03, the obligations and responsibilities of the
Depositor, the Servicers and the Trustee created hereby with respect to the
Trust Fund shall terminate upon the earlier of (a) the purchase, on or after the
Optional Termination Date, by either Servicer individually, or both Servicers
together, of all Mortgage Loans (and REO Properties) at the price equal to the
sum of (i) 100% of the Stated Principal Balance of each Mortgage Loan (other
than in respect of REO Property) plus one month's accrued interest thereon at
the applicable Mortgage Rate and (ii) the lesser of (x) the appraised value of
any REO Property as determined by the higher of two appraisals completed by two
independent appraisers selected by such Servicer at the expense of such Servicer
and (y) the unpaid principal balance of each Mortgage Loan related to any REO
Property, in each case plus accrued and unpaid interest thereon at the
applicable Mortgage Rate and (b) the later of (i) the maturity or other
liquidation of the last Mortgage Loan remaining in the Trust Fund and the
disposition of all REO Property and (ii) the distribution to Certificateholders
of all amounts required to be distributed to them pursuant to this Agreement. In
no event shall the trusts created hereby continue beyond the expiration of 21
years from the death of the 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.
Section 9.02 Final Distribution on the Certificates.
If on any Remittance Date, the Servicers determine that there are no
Outstanding Mortgage Loans and no other funds or assets in the Trust Fund other
than the funds in the Collection Accounts, the Servicers shall direct the
Trustee promptly to send a Notice of Final Distribution to each
Certificateholder. If either Servicer individually elects to terminate the Trust
Fund pursuant to clause (a) of Section 9.01, such Servicer shall notify the
other Servicer of such election at least 30 days prior to the date of the Notice
of Final Distribution and such other Servicer shall have 5 days to elect to
purchase the Mortgage Loans it services. If either Servicer or both Servicers so
elect to terminate, at least 20 days prior to the date the Notice of Final
Distribution is to be mailed to the affected Certificateholders, such Servicer
or Servicers shall notify the Depositor and the Trustee of the date such
Servicer or Servicers intend or intends to terminate the Trust Fund and of the
applicable repurchase price of the Mortgage Loans and REO Properties.
A Notice of Final Distribution, specifying the Distribution Date on
which Certificateholders may surrender their Certificates for payment of the
final distribution and cancellation, shall be given promptly by the Trustee by
letter to Certificateholders mailed not earlier than the 15th day and not later
than the 10th day of the month next preceding the month of such final
distribution. Any such Notice of Final Distribution shall specify (a) the
Distribution Date upon which final distribution on the Certificates will be made
upon presentation and surrender of Certificates at the office therein
designated, (b) the amount of such final distribution, (c) the location of the
office or agency at which such presentation and surrender must be made, and (d)
that the Record Date otherwise applicable to such Distribution Date is not
applicable, distributions being made only upon presentation and surrender of the
Certificates at the office therein specified. The Servicer or Servicers, as the
case may be, will give such Notice of Final Distribution to each Rating Agency
at the time such Notice of Final Distribution is given to Certificateholders.
In the event such Notice of Final Distribution is given, each
Servicer shall cause all funds in its Collection Account to be remitted to the
Trustee for deposit in the Distribution Account on the Business Day prior to the
applicable Distribution Date in an amount equal to the final distribution in
respect of the Certificates. Upon such final deposit with respect to the Trust
Fund and the receipt by the Trustee of a Request for Release therefor, the
Trustee shall promptly release to the Servicer or Servicers, as the case may be,
the Custodial Files for the Mortgage Loans.
Upon presentation and surrender of the Certificates, the Trustee
shall cause to be distributed to the Certificateholders of each Class, in each
case on the final Distribution Date and in the order set forth in Section 4.02,
in proportion to their respective Percentage Interests, with respect to
Certificateholders of the same Class, an amount equal to (i) as to each Class of
Regular Certificates (except the Class X Certificate), the Certificate Balance
thereof plus for each such Class and the Class X Certificate accrued interest
thereon in the case of an interest-bearing Certificate and (ii) as to the
Residual Certificates, the amount, if any, which remains on deposit in the
Distribution Account (other than the amounts retained to meet claims) after
application pursuant to clause (i) above.
In the event that any affected Certificateholders shall not
surrender Certificates for cancellation within six months after the date
specified in the above mentioned written notice, the Trustee shall give a second
written notice to the remaining Certificateholders to surrender their
Certificates for cancellation and receive the final distribution with respect
thereto. If within six months after the second notice all the applicable
Certificates shall not have been surrendered for cancellation, the Trustee may
take appropriate steps, or may appoint an agent to take appropriate steps, to
contact the remaining Certificateholders concerning surrender of their
Certificates, and the cost thereof shall be paid out of the funds and other
assets which remain a part of the Trust Fund. If within one year after the
second notice all Certificates shall not have been surrendered for cancellation,
the Class R Certificateholders shall be entitled to all unclaimed funds and
other assets of the Trust Fund which remain subject hereto.
Section 9.03 Additional Termination Requirements.
In the event the applicable Servicer or both Servicers exercise
their purchase option with respect to the Mortgage Loans as provided in Section
9.01, the Trust Fund shall be terminated in accordance with the following
additional requirements, unless the Trustee has been supplied with an Opinion of
Counsel, at the expense of the applicable Servicer or the Servicers, as the case
may be, to the effect that the failure to comply with the requirements of this
Section 9.03 will not (i) result in the imposition of taxes on "prohibited
transactions" on either REMIC as defined in Section 860F of the Code, or (ii)
cause either the Lower Tier REMIC or the Upper Tier REMIC to fail to qualify as
a REMIC at any time that any Certificates are outstanding:
(a) The Trustee shall sell all of the assets of the Trust Fund to
the Servicer or the applicable Servicers, as the case may be, and, within 90
days of such sale, shall distribute to the Certificateholders the proceeds of
such sale in complete liquidation of each of the Lower Tier REMIC and the Upper
Tier REMIC.
(b) The Trustee shall attach a statement to the final federal income
tax return for each of the Lower Tier REMIC and the Upper Tier REMIC stating
that pursuant to Treasury Regulations Section 1.860F-1, the first day of the
90-day liquidation period for each such REMIC was the date on which the Trustee
sold the assets of the Trust Fund to the applicable Servicer or the Servicers,
as the case may be.
ARTICLE X
MISCELLANEOUS PROVISIONS
Section 10.01 Amendment.
This Agreement may be amended from time to time by the Depositor,
the Servicers and the Trustee without the consent of any of the
Certificateholders (i) to cure any ambiguity or mistake, (ii) to correct any
defective provision herein or to supplement any provision herein which may be
inconsistent with any other provision herein, (iii) to add to the duties of the
Depositor or the Servicers, (iv) to add any other provisions with respect to
matters or questions arising hereunder or (v) to modify, alter, amend, add to or
rescind any of the terms or provisions contained in this Agreement; provided
that any action pursuant to clauses (iv) or (v) above shall not, as evidenced by
an Opinion of Counsel (which Opinion of Counsel shall not be an expense of the
Trustee or the Trust Fund), adversely affect in any material respect the
interests of any Certificateholder; and provided, further, that the amendment
shall not be deemed to adversely affect in any material respect the interests of
the Certificateholders if the Person requesting the amendment obtains a letter
from each Rating Agency stating that the amendment would not result in the
downgrading or withdrawal of the respective ratings then assigned to the
Certificates; it being understood and agreed that any such letter in and of
itself will not represent a determination as to the materiality of any such
amendment and will represent a determination only as to the credit issues
affecting any such rating. The Trustee, the Depositor and the Servicers also may
at any time and from time to time amend this Agreement without the consent of
the Certificateholders to modify, eliminate or add to any of its provisions to
such extent as shall be necessary or helpful to (i) maintain the qualification
of the Lower Tier REMIC and the Upper Tier REMIC under the Code, (ii) avoid or
minimize the risk of the imposition of any tax on the Lower Tier REMIC or the
Upper Tier REMIC pursuant to the Code that would be a claim at any time prior to
the final redemption of the Certificates or (iii) comply with any other
requirements of the Code, provided that the Trustee has been provided an Opinion
of Counsel, which opinion shall be an expense of the party requesting such
opinion but in any case shall not be an expense of the Trustee or the Trust
Fund, to the effect that such action is necessary or helpful to, as applicable,
(i) maintain such qualification, (ii) avoid or minimize the risk of the
imposition of such a tax or (iii) comply with any such requirements of the Code.
This Agreement may also be amended from time to time by the
Depositor, the Servicers and the Trustee with the consent of the Holders of
Certificates evidencing Percentage Interests aggregating not less than 662/3% of
each Class of Certificates affected thereby for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Agreement or of modifying in any manner the rights of the Holders of
Certificates; provided, however, that no such amendment shall (i) reduce in any
manner the amount of, or delay the timing of, payments required to be
distributed on any Certificate without the consent of the Holder of such
Certificate, (ii) adversely affect in any material respect the interests of the
Holders of any Class of Certificates in a manner other than as described in (i),
without the consent of the Holders of Certificates of such Class evidencing, as
to such Class, Percentage Interests aggregating not less than 662/3%, or (iii)
reduce the aforesaid percentages of Certificates the Holders of which are
required to consent to any such amendment, without the consent of the Holders of
all such Certificates then outstanding.
Notwithstanding any contrary provision of this Agreement, the
Trustee shall not consent to any amendment to this Agreement unless (i) it shall
have first received an Opinion of Counsel, which opinion shall not be an expense
of the Trustee or the Trust Fund, to the effect that such amendment will not
cause the imposition of any tax on any REMIC or the Certificateholders or cause
any REMIC to fail to qualify as a REMIC at any time that any Certificates are
outstanding and (ii) the party seeking such amendment shall have provided
written notice to the Rating Agencies (with a copy of such notice to the
Trustee) of such amendment, stating the provisions of the Agreement to be
amended.
Notwithstanding the foregoing provisions of this Section 10.01, with
respect to any amendment that significantly modifies the permitted activities of
the Trustee or the Servicers, any Certificate beneficially owned by the
Depositor or any of its Affiliates shall be deemed not to be outstanding (and
shall not be considered when determining the percentage of Certificateholders
consenting or when calculating the total number of Certificates entitled to
consent) for purposes of determining if the requisite consents of
Certificateholders under this Section 10.01 have been obtained.
Promptly after the execution of any amendment to this Agreement
requiring the consent of Certificateholders, the Trustee shall furnish written
notification of the substance or a copy of such amendment to each
Certificateholder and each Rating Agency.
It shall not be necessary for the consent of Certificateholders
under this Section 10.01 to approve the particular form of any proposed
amendment, but it shall be sufficient if such consent shall approve the
substance thereof. The manner of obtaining such consents and of evidencing the
authorization of the execution thereof by Certificateholders shall be subject to
such reasonable regulations as the Trustee may prescribe.
Nothing in this Agreement shall require the Trustee to enter into an
amendment without receiving an Opinion of Counsel (which Opinion shall not be an
expense of the Trustee or the Trust Fund), satisfactory to the Trustee that (i)
such amendment is permitted and is not prohibited by this Agreement and that all
requirements for amending this Agreement have been complied with; and (ii)
either (A) the amendment does not adversely affect in any material respect the
interests of any Certificateholder or (B) the conclusion set forth in the
immediately preceding clause (A) is not required to be reached pursuant to this
Section 10.01.
Section 10.02 Recordation of Agreement; Counterparts.
This Agreement is subject to recordation in all appropriate public
offices for real property records in all the counties or other comparable
jurisdictions in which any or all of the properties subject to the Mortgages are
situated, and in any other appropriate public recording office or elsewhere,
such recordation to be effected by the Servicers at their expense, but only upon
receipt of an Opinion of Counsel to the effect that such recordation materially
and beneficially affects the interests of the Certificateholders.
For the purpose of facilitating the recordation of this Agreement as
herein provided and for other purposes, this Agreement may be executed
simultaneously in any number of counterparts, each of which counterparts shall
be deemed to be an original, and such counterparts shall constitute but one and
the same instrument.
Section 10.03 Governing Law.
THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY
THE SUBSTANTIVE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND
TO BE PERFORMED IN THE STATE OF NEW YORK AND THE OBLIGATIONS, RIGHTS AND
REMEDIES OF THE PARTIES HERETO AND THE CERTIFICATEHOLDERS SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
Section 10.04 Intention of Parties.
It is the express intent of the parties hereto that the conveyance
(i) of the Mortgage Loans by the Depositor and (ii) of the Trust Fund by the
Depositor to the Trustee each be, and be construed as, an absolute sale thereof.
It is, further, not the intention of the parties that such conveyances be deemed
a pledge thereof. However, in the event that, notwithstanding the intent of the
parties, such assets are held to be the property of the Depositor, as the case
may be, or if for any other reason this Agreement is held or deemed to create a
security interest in either such assets, then (i) this Agreement shall be deemed
to be a security agreement within the meaning of the Uniform Commercial Code of
the State of New York and (ii) the conveyances provided for in this Agreement
shall be deemed to be an assignment and a grant by the Depositor to the Trustee,
for the benefit of the Certificateholders, of a security interest in all of the
assets transferred, whether now owned or hereafter acquired.
The Depositor for the benefit of the Certificateholders shall, to
the extent consistent with this Agreement, take such actions as may be necessary
to ensure that, if this Agreement were deemed to create a security interest in
the Trust Fund, such security interest would be deemed to be a perfected
security interest of first priority under applicable law and will be maintained
as such throughout the term of the Agreement. The Depositor shall arrange for
filing any Uniform Commercial Code continuation statements in connection with
any security interest granted or assigned to the Trustee for the benefit of the
Certificateholders.
Section 10.05 Notices.
(a) The Trustee shall use its best efforts to promptly provide
notice to each Rating Agency with respect to each of the following of which it
has actual knowledge:
1. Any material change or amendment to this Agreement;
2. The occurrence of any Event of Default that has not been cured;
3. The resignation or termination of a Servicer or the Trustee and
the appointment of any successor;
4. The repurchase of Mortgage Loans pursuant to Section 2.03; and
5. The final payment to Certificateholders.
(b) In addition, the Trustee shall promptly furnish to each Rating
Agency copies of the following:
1. Each report to Certificateholders described in Section 4.03;
and
2. Any notice of a purchase of a Mortgage Loan pursuant to Section
2.02, 2.03 or 3.11.
All directions, demands and notices hereunder shall be in writing
and shall be deemed to have been duly given when delivered to (a) in the case of
the Depositor or the Underwriter, Xxxxxx Xxxxxxx Xxxx Xxxxxx Capital I Inc. or
Xxxxxx Xxxxxxx & Co. Incorporated. 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx
Xxxx 00000, Attention: Xxxxxxxx Xxxxx, Esq.; (b) in the case of the Servicers,
to each of the following: (i) Ocwen Federal Bank FSB, 0000 Xxxx Xxxxx Xxxxx
Xxxx., Xxxxx 00X, Xxxx Xxxx Xxxxx, Xxxxxxx 00000, Attention: Secretary, or such
other address as may be hereafter furnished to the Depositor, The Provident Bank
and the Trustee by Ocwen Federal Bank FSB in writing; and (ii) The Provident
Bank, 0000 Xxxxxxxxxxxxx Xxxxxxx Xxxxxxx, Xxxxxxx 00000, Attention: Xxxxx
Xxxxxx, or such other address as may be hereafter furnished to the Depositor,
Ocwen Federal Bank FSB and the Trustee by The Provident Bank in writing; (c) in
the case of the Trustee to the Corporate Trust Office, U.S. Bank National Trust
Association, 000 Xxxx Xxxxx Xxxxxx, Xx. Xxxx, Xxxxxxxxx 00000, Attention:
Structured Finance/MSDW 2002-HE1, or such other address as the Trustee may
hereafter furnish to the Depositor or the Servicers; and (d) in the case of each
of the Rating Agencies, the address specified therefor in the definition
corresponding to the name of such Rating Agency. Notices to Certificateholders
shall be deemed given when mailed, first class postage prepaid, to their
respective addresses appearing in the Certificate Register.
Section 10.06 Severability of Provisions.
If any one or more of the covenants, agreements, provisions or terms
of this Agreement shall be for any reason whatsoever held invalid, then such
covenants, agreements, provisions or terms shall be deemed severable from the
remaining covenants, agreements, provisions or terms of this Agreement and shall
in no way affect the validity or enforceability of the other provisions of this
Agreement or of the Certificates or the rights of the Holders thereof.
Section 10.07 Assignment; Sales; Advance Facilities.
Notwithstanding anything to the contrary contained herein, except as
provided in Section 6.02, this Agreement may not be assigned by either Servicer
without the prior written consent of the Trustee and Depositor; provided,
however, either Servicer is hereby authorized to enter into an Advance Facility
under which (l) the Servicer sells, assigns or pledges to an Advancing Person
the Servicer's rights under this Agreement to be reimbursed for any P&I Advances
or Servicing Advances and/or (2) an Advancing Person agrees to fund some or all
P&I Advances or Servicing Advances required to be made by the Servicer pursuant
to this Agreement. No consent of the Trustee, Certificateholders or any other
party is required before the Servicer may enter into an Advance Facility.
Notwithstanding the existence of any Advance Facility under which an Advancing
Person agrees to fund P&I Advances and/or Servicing Advances on the Servicer's
behalf, the Servicer shall remain obligated pursuant to this Agreement to make
P&I Advances and Servicing Advances pursuant to and as required by this
Agreement, and shall not be relieved of such obligations by virtue of such
Advance Facility.
Reimbursement amounts shall consist solely of amounts in respect of
P&I applicable Advances and/or Servicing Advances made with respect to the
Mortgage Loans for which the Servicer would be permitted to reimburse itself in
accordance with this Agreement, assuming the Servicer had made the related P&I
Advance(s) and/or Servicing Advance(s).
The applicable Servicer shall maintain and provide to any successor
Servicer a detailed accounting on a loan-by-loan basis as to amounts advanced
by, pledged or assigned to, and reimbursed to any Advancing Person. The
successor Servicer shall be entitled to rely on any such information provided by
the predecessor Servicer, and the successor Servicer shall not be liable for any
errors in such information.
An Advancing Person who purchases or receives an assignment or
pledge of the rights to be reimbursed for P&I Advances and/or Servicing
Advances, and/or whose obligations hereunder are limited to the funding of P&I
Advances and/or Servicing Advances shall not be required to meet the criteria
for qualification of a Sub-Servicer set forth in this Agreement.
The documentation establishing any Advance Facility shall require
that Reimbursement Amounts distributed with respect to each Mortgage Loan be
allocated to outstanding xxxxxxxxxxxx X&X Advances or Servicing Advances (as the
case may be) made with respect to that Mortgage Loan on a "first-in, first out"
(FIFO) basis. Such documentation shall also require the Servicer to provide to
the related Advancing Person or its designee loan-by-loan information with
respect to each Reimbursement Amount distributed to such Advancing Person or
Advance Facility Trustee on each Distribution Date, to enable the Advancing
Person or Advance Facility Trustee to make the FIFO allocation of each
Reimbursement Amount with respect to each Mortgage Loan. The applicable Servicer
shall remain entitled to be reimbursed by the Advancing Person or Advance
Facility Trustee for all P&I Advances and Servicing Advances funded by the
Servicer to the extent the related rights to be reimbursed therefor have not
been sold, assigned or pledged to an Advancing Person.
Any amendment to this Section 10.07 or to any other provision of
this Agreement that may be necessary or appropriate to effect the terms of an
Advance Facility as described generally in this Section 10.07, including
amendments to add provisions relating to a successor Servicer, may be entered
into by the Trustee, the Seller and the Servicers without the consent of any
Certificateholder, notwithstanding anything to the contrary in this Agreement.
Prior to entering into an Advance Facility, the applicable Servicer shall notify
the lender under such facility in writing that: (a) the Advances financed by
and/or pledged to the lender are obligations owed to the Servicer on a
non-recourse basis payable only from the cash flows and proceeds received under
this Agreement for reimbursement of Advances only to the extent provided herein,
and the Trustee and the Trust are not otherwise obligated or liable to repay any
Advances financed by the lender; (b) the applicable Servicer will be responsible
for remitting to the lender the applicable amounts collected by it as
reimbursement for Advances funded by the lender, subject to the restrictions and
priorities created in this Agreement; and (c) the Trustee shall not have any
responsibility to track or monitor the administration of the financing
arrangement between the Servicer and the lender.
Section 10.08 Limitation on Rights of Certificateholders.
The death or incapacity of any Certificateholder shall not operate
to terminate this Agreement or the trust created hereby, nor entitle such
Certificateholder's legal representative or heirs to claim an accounting or to
take any action or commence any proceeding in any court for a petition or
winding up of the trust created hereby, or 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
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 party 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 or by availing
itself of any provisions of this Agreement to institute any suit, action or
proceeding in equity or at law upon or under or with respect to this Agreement,
unless such Holder previously shall have given to the Trustee a written notice
of an Event of Default and of the continuance thereof, as herein provided, and
unless the Holders of Certificates evidencing not less than 25% of the Voting
Rights evidenced by the Certificates shall also have made written request to the
Trustee to institute such action, suit or proceeding in its own name as Trustee
hereunder and shall have offered to the Trustee such reasonable indemnity as it
may require against the costs, expenses, and liabilities to be incurred therein
or thereby, and the Trustee, for 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
shall have any right in any manner whatever by virtue or by availing itself or
themselves of any provisions of this Agreement to affect, disturb or prejudice
the rights of the Holders of any other of the Certificates, or to obtain or seek
to obtain priority over or preference to any other such Holder or to enforce any
right under this Agreement, except in the manner herein provided and for the
common benefit of all Certificateholders. For the protection and enforcement of
the provisions of this Section 10.08, each and every Certificateholder and the
Trustee shall be entitled to such relief as can be given either at law or in
equity.
Section 10.09 Inspection and Audit Rights.
Each Servicer agrees that, on reasonable prior notice, it will
permit any representative of the Depositor or the Trustee during such Person's
normal business hours, to examine all the books of account, records, reports and
other papers of such Person relating to the Mortgage Loans, to make copies and
extracts therefrom, to cause such books to be audited by independent certified
public accountants selected by the Depositor or the Trustee and to discuss its
affairs, finances and accounts relating to the Mortgage Loans with its officers,
employees and independent public accountants (and by this provision each
Servicer hereby authorizes said accountants to discuss with such representative
such affairs, finances and accounts), all at such reasonable times and as often
as may be reasonably requested. Any out-of-pocket expense of a Servicer incident
to the exercise by the Depositor or the Trustee of any right under this Section
10.09 shall be borne by such Servicer.
Section 10.10 Certificates Nonassessable and Fully Paid.
It is the intention of the Depositor that Certificate holders shall
not be personally liable for obligations of the Trust Fund, that the interests
in the Trust Fund represented by the Certificates shall be nonassessable for any
reason whatsoever, and that the Certificates, upon due authentication thereof by
the Trustee pursuant to this Agreement, are and shall be deemed fully paid.
Section 10.11 Waiver of Jury Trial.
EACH PARTY HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES
(TO THE EXTENT PERMITTED BY APPLICABLE LAW) ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY OF ANY DISPUTE ARISING UNDER OR RELATING TO THIS AGREEMENT AND AGREES THAT
ANY SUCH DISPUTE SHALL BE TRIED BEFORE A JUDGE SITTING WITHOUT A JURY.
Section 10.12 Limitation of Damages.
NOTWITHSTANDING ANYTHING CONTAINED HEREIN TO THE CONTRARY, THE
PARTIES AGREE THAT NO PARTY SHALL BE LIABLE TO ANY OTHER PARTY FOR ANY PUNITIVE
DAMAGES WHATSOEVER, WHETHER IN CONTRACT, TORT (INCLUDING NEGLIGENCE AND STRICT
LIABILITY), OR ANY OTHER LEGAL OR EQUITABLE PRINCIPLE, PROVIDED, HOWEVER, THAT
SUCH LIMITATION SHALL NOT BE APPLICABLE WITH RESPECT TO THIRD PARTY CLAIMS MADE
AGAINST A PARTY.
* * * * * * *
IN WITNESS WHEREOF, the Depositor, the Trustee and the Servicers
have caused their names to be signed hereto by their respective officers
thereunto duly authorized as of the day and year first above written.
XXXXXX XXXXXXX XXXX XXXXXX CAPITAL I INC.,
as Depositor
By:________________________________________
Name:
Title:
U.S. BANK NATIONAL ASSOCIATION,
solely as Trustee and not in its
individual capacity
By: ______________________________________
Name:
Title:
By: ______________________________________
Name:
Title:
OCWEN FEDERAL BANK FSB,
as a Servicer
By: ______________________________________
Name:
Title:
THE PROVIDENT BANK,
as a Servicer
By: ______________________________________
Name:
Title:
SCHEDULE I
Mortgage Loan Schedule
SCHEDULE II
Mortgage Pass-Through Certificates,
Series 2002-HE1
Representations and Warranties of Ocwen Federal Bank as a Servicer
------------------------------------------------------------------
OCWEN FEDERAL BANK FSB (the "Servicer") hereby makes the
representations and warranties set forth in this Schedule II to the Depositor
and the Trustee, as of the Closing Date, or if so specified herein, as of the
Cut-off Date. Capitalized terms used but not otherwise defined in this Schedule
II shall have the meanings ascribed thereto in the Pooling and Servicing
Agreement (the "Pooling and Servicing Agreement") relating to the
above-referenced Series.
(1) The Servicer is a federally chartered savings bank duly
organized, validly existing and in good standing under the laws of the
United States and is duly authorized and qualified to transact any and all
business contemplated by this Pooling and Servicing Agreement to be
conducted by the Servicer in any state in which a Mortgaged Property
securing a New Century Mortgage Loan or a First Franklin Mortgage Loan is
located or is otherwise not required under applicable law to effect such
qualification and, in any event, is in compliance with the doing business
laws of any such State, to the extent necessary to ensure its ability to
enforce each New Century Mortgage Loan and each First Franklin Mortgage
Loan and to service the New Century Mortgage Loans and the First Franklin
Mortgage Loans in accordance with the terms of this Pooling and Servicing
Agreement;
(2) The Servicer has the full power and authority to service each
New Century Mortgage Loan and each First Franklin Mortgage Loan, and to
execute, deliver and perform, and to enter into and consummate the
transactions contemplated by this Pooling and Servicing Agreement and has
duly authorized by all necessary action on the part of the Servicer the
execution, delivery and performance of this Pooling and Servicing
Agreement; and this Pooling and Servicing Agreement, assuming the due
authorization, execution and delivery thereof by the Depositor and the
Trustee, constitutes a legal, valid and binding obligation of the
Servicer, enforceable against the Servicer in accordance with its terms,
except to the extent that (a) the enforceability thereof may be limited by
bankruptcy, insolvency, moratorium, receivership and other similar laws
relating to creditors' rights generally and (b) the remedy of specific
performance and injunctive and other forms of equitable relief may be
subject to the equitable defenses and to the discretion of the court
before which any proceeding therefor may be brought;
(3) The execution and delivery of this Pooling and Servicing
Agreement by the Servicer, the servicing of the New Century Mortgage Loans
and the First Franklin Mortgage Loans by the Servicer hereunder, the
consummation by the Servicer of any other of the transactions herein
contemplated, and the fulfillment of or compliance with the terms hereof
are in the ordinary course of business of the Servicer and will not (A)
result in a breach of any term or provision of the organizational
documents of the Servicer or (B) conflict with, result in a breach,
violation or acceleration of, or result in a default under, the terms of
any other material agreement or instrument to which the Servicer is a
party or by which it may be bound, or any statute, order or regulation
applicable to the Servicer of any court, regulatory body, administrative
agency or governmental body having jurisdiction over the Servicer; and the
Servicer is not a party to, bound by, or in breach or violation of any
indenture or other agreement or instrument, or subject to or in violation
of any statute, order or regulation of any court, regulatory body,
administrative agency or governmental body having jurisdiction over it,
which materially and adversely affects or, to the Servicer's knowledge,
would in the future materially and adversely affect, (x) the ability of
the Servicer to perform its obligations under this Pooling and Servicing
Agreement or (y) the business, operations, financial condition, properties
or assets of the Servicer taken as a whole;
(4) the Servicer is an approved seller/servicer for Xxxxxx Xxx, an
approved servicer for Xxxxxxx Mac in good standing and is a HUD approved
non-supervised mortgagee;
(5) No litigation is pending against the Servicer that would
materially and adversely affect the execution, delivery or enforceability
of this Pooling and Servicing Agreement or the ability of the Servicer to
service the New Century Mortgage Loans or the First Franklin Mortgage
Loans or to perform any of its other obligations hereunder in accordance
with the terms hereof;
(6) No consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by the Servicer of, or compliance by the Servicer with, this
Pooling and Servicing Agreement or the consummation by the Servicer of the
transactions contemplated by this Pooling and Servicing Agreement, except
for such consents, approvals, authorizations or orders, if any, that have
been obtained prior to the Closing Date; and
(7) The Servicer covenants that its computer and other systems used
in servicing the New Century Mortgage Loans and the First Franklin
Mortgage Loans operate in a manner such that the Servicer can service the
New Century Mortgage Loans and the First Franklin Mortgage Loans in
accordance with the terms of this Pooling and Servicing Agreement.
SCHEDULE III
Mortgage Pass-Through Certificates,
Series 2002-HE1
Representations and Warranties of The Provident Bank as a Servicer
------------------------------------------------------------------
THE PROVIDENT BANK (the "Servicer") hereby makes the representations
and warranties set forth in this Schedule II to the Depositor and the Trustee,
as of the Closing Date, or if so specified herein, as of the Cut-off Date.
Capitalized terms used but not otherwise defined in this Schedule II shall have
the meanings ascribed thereto in the Pooling and Servicing Agreement (the
"Pooling and Servicing Agreement") relating to the above-referenced Series.
(1) The Servicer is an Ohio banking corporation duly organized,
validly existing and in good standing under the laws of the State of Ohio
and is duly authorized and qualified to transact any and all business
contemplated by this Pooling and Servicing Agreement to be conducted by
the Servicer in any state in which a Mortgaged Property securing an
Accredited Mortgage Loan is located or is otherwise not required under
applicable law to effect such qualification and, in any event, is in
compliance with the doing business laws of any such State, to the extent
necessary to ensure its ability to enforce each Accredited Mortgage Loan
and to service the Accredited Mortgage Loans in accordance with the terms
of this Pooling and Servicing Agreement;
(2) The Servicer has the full power and authority to service each
Accredited Mortgage Loan, and to execute, deliver and perform, and to
enter into and consummate the transactions contemplated by this Pooling
and Servicing Agreement and has duly authorized by all necessary action on
the part of the Servicer the execution, delivery and performance of this
Pooling and Servicing Agreement; and this Pooling and Servicing Agreement,
assuming the due authorization, execution and delivery thereof by the
Depositor and the Trustee, constitutes a legal, valid and binding
obligation of the Servicer, enforceable against the Servicer in accordance
with its terms, except to the extent that (a) the enforceability thereof
may be limited by bankruptcy, insolvency, moratorium, receivership and
other similar laws relating to creditors' rights generally and (b) the
remedy of specific performance and injunctive and other forms of equitable
relief may be subject to the equitable defenses and to the discretion of
the court before which any proceeding therefor may be brought;
(3) The execution and delivery of this Pooling and Servicing
Agreement by the Servicer, the servicing of the Accredited Mortgage Loans
by the Servicer hereunder, the consummation by the Servicer of any other
of the transactions herein contemplated, and the fulfillment of or
compliance with the terms hereof are in the ordinary course of business of
the Servicer and will not (A) result in a breach of any term or provision
of the organizational documents of the Servicer or (B) conflict with,
result in a breach, violation or acceleration of, or result in a default
under, the terms of any other material agreement or instrument to which
the Servicer is a party or by which it may be bound, or any statute, order
or regulation applicable to the Servicer of any court, regulatory body,
administrative agency or governmental body having jurisdiction over the
Servicer; and the Servicer is not a party to, bound by, or in breach or
violation of any indenture or other agreement or instrument, or subject to
or in violation of any statute, order or regulation of any court,
regulatory body, administrative agency or governmental body having
jurisdiction over it, which materially and adversely affects or, to the
Servicer's knowledge, would in the future materially and adversely affect,
(x) the ability of the Servicer to perform its obligations under this
Pooling and Servicing Agreement or (y) the business, operations, financial
condition, properties or assets of the Servicer taken as a whole;
(4) the Servicer is an approved seller/servicer for Xxxxxx Xxx, an
approved servicer for Xxxxxxx Mac in good standing and is a HUD approved
non-supervised mortgagee;
(5) No litigation is pending against the Servicer that would
materially and adversely affect the execution, delivery or enforceability
of this Pooling and Servicing Agreement or the ability of the Servicer to
service the Accredited Mortgage Loans or to perform any of its other
obligations hereunder in accordance with the terms hereof;
(6) No consent, approval, authorization or order of any court or
governmental agency or body is required for the execution, delivery and
performance by the Servicer of, or compliance by the Servicer with, this
Pooling and Servicing Agreement or the consummation by the Servicer of the
transactions contemplated by this Pooling and Servicing Agreement, except
for such consents, approvals, authorizations or orders, if any, that have
been obtained prior to the Closing Date; and
(7) The Servicer covenants that it can service the Accredited
Mortgage Loans in accordance with the terms of this Pooling and Servicing
Agreement.
EXHIBIT A
[[To be added to the Class A-1 Certificate while it remains a Private
Certificate.] IF THIS CERTIFICATE IS A PHYSICAL CERTIFICATE, NEITHER THIS
CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE PROPOSED
TRANSFEROR DELIVERS TO THE TRUSTEE A TRANSFEROR LETTER (THE "TRANSFEROR LETTER")
IN THE FORM OF EXHIBIT H TO THE AGREEMENT REFERRED TO HEREIN AND EITHER (I) THE
TRUSTEE RECEIVES A RULE 144A LETTER (THE "144A LETTER") IN THE FORM OF EXHIBIT I
TO THE AGREEMENT REFERRED TO HEREIN OR (II) THE TRUSTEE RECEIVES AN OPINION OF
COUNSEL, DELIVERED AT THE EXPENSE OF THE TRANSFEROR, THAT SUCH TRANSFER MAY BE
MADE WITHOUT REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
IF THIS CERTIFICATE IS A BOOK-ENTRY CERTIFICATE, THE PROPOSED TRANSFEROR WILL BE
DEEMED TO HAVE MADE EACH OF THE CERTIFICATIONS SET FORTH IN THE TRANSFEROR
LETTER AND THE PROPOSED TRANSFEREE WILL BE DEEMED TO HAVE MADE EACH OF THE
CERTIFICATIONS SET FORTH IN THE RULE 144A LETTER, in each case as if such
Certificate were evidenced by a Physical Certificate.]
In the event that a transfer of a Private Certificate which is a Book-Entry
Certificate is to be made in reliance upon an exemption from the Securities Act
and such laws, in order to assure compliance with the Securities Act and such
laws, the Certificateholder desiring to effect such transfer will be deemed to
have made as of the transfer date each of the certifications set forth in the
Transferor Certificate in respect of such Certificate and the transferee will be
deemed to have made as of the transfer date each of the certifications set forth
in the Rule 144A Letter in respect of such Certificate, in each case as if such
Certificate were evidenced by a Physical Certificate.
Unless this Certificate is presented by an authorized representative of the
Depository Trust Company, a New York corporation ("DTC"), to Issuer or its agent
for registration of transfer, exchange, or payment, and any certificate issued
is registered in the name of Cede & Co. or in such other name as is requested by
an authorized representative of DTC (and any payment is made to Cede & Co. or to
such other entity as is requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE REPRESENTS AN
INTEREST IN A "REGULAR INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT,"
AS THOSE TERMS ARE DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), AND CERTAIN OTHER
ASSETS.
Certificate No. :
Cut-off Date : June 1, 2002
First Distribution Date : July 25, 2002
Initial Certificate Balance
of this Certificate
("Denomination") : $
Initial Certificate
Balances of all
Certificates of this Class : $
CUSIP :
XXXXXX XXXXXXX XXXX XXXXXX CAPITAL I INC.
Xxxxxx Xxxxxxx Xxxx Xxxxxx Capital I Inc. Trust 2002-HE1
Mortgage Pass-Through Certificates, Series 2002-HE1
[Class A-][Class M-][Class B-1] [Class B-2]
evidencing a percentage interest in the distributions allocable to
the Certificates of the above-referenced Class.
Principal in respect of this Certificate is distributable monthly as
set forth herein. Accordingly, the Certificate Balance at any time may be less
than the Certificate Balance as set forth herein. This Certificate does not
evidence an obligation of, or an interest in, and is not guaranteed by the
Depositor, the Servicers or the Trustee referred to below or any of their
respective affiliates. Neither this Certificate nor the Mortgage Loans are
guaranteed or insured by any governmental agency or instrumentality.
This certifies that CEDE & CO. is the registered owner of the
Percentage Interest evidenced by this Certificate (obtained by dividing the
denomination of this Certificate by the aggregate of the denominations of all
Certificates of the Class to which this Certificate belongs) in certain monthly
distributions pursuant to a Pooling and Servicing Agreement dated as of the
Cut-off Date specified above (the "Agreement") among Xxxxxx Xxxxxxx Xxxx Xxxxxx
Capital I Inc., as depositor (the "Depositor"), Ocwen Federal Bank FSB, as a
servicer ("Ocwen"), The Provident Bank, as a servicer ("Provident" and, together
with Ocwen, the "Servicers") and U.S. Bank National Association, as trustee (the
"Trustee"). To the extent not defined herein, the capitalized terms used herein
have the meanings assigned in the Agreement. This Certificate is issued under
and is subject to the terms, provisions and conditions of the Agreement, to
which Agreement the Holder of this Certificate by virtue of the acceptance
hereof assents and by which such Holder is bound.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually countersigned by an
authorized signatory of the Trustee.
* * *
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated:
U.S. BANK NATIONAL ASSOCIATION,
not in its individual capacity, but
solely as Trustee
By __________________________________
Countersigned:
By ________________________________
Authorized Signatory of
U.S. BANK NATIONAL ASSOCIATION,
not in its individual capacity,
but solely as Trustee
XXXXXX XXXXXXX XXXX XXXXXX CAPITAL I INC.
Xxxxxx Xxxxxxx Xxxx Xxxxxx Capital I Inc. Trust 2002-HE1
Mortgage Pass-Through Certificates
This Certificate is one of a duly authorized issue of Certificates
designated as Xxxxxx Xxxxxxx Xxxx Xxxxxx Capital I Inc. Trust 2002-HE1 Mortgage
Pass-Through Certificates, of the Series specified on the face hereof (herein
collectively called the "Certificates"), and representing a beneficial ownership
interest in the Trust Fund created by the Agreement.
The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
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 thereby, and the rights,
duties and immunities of the Trustee.
Pursuant to the terms of the Agreement, a distribution will be made
on the 25th day of each month or, if such day is not a Business Day, the
Business Day immediately following (the "Distribution Date"), commencing on the
first Distribution Date specified on the face hereof, to the Person in whose
name this Certificate is registered at the close of business on the applicable
Record Date in an amount equal to the product of the Percentage Interest
evidenced by this Certificate and the amount required to be distributed to
Holders of Certificates of the Class to which this Certificate belongs on such
Distribution Date pursuant to the Agreement. The Record Date applicable to each
Distribution Date is the Business Date immediately preceding such Distribution
Date, provided, however, that for any Definitive Certificates, the Record Date
shall be the last Business Day of the month next preceding the month of such
Distribution Date.
Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or
other entity having appropriate facilities therefor, if such Certificateholder
shall have so notified the Trustee in writing at least five Business Days prior
to the related Record Date and such Certificateholder shall satisfy the
conditions to receive such form of payment set forth in the Agreement, or, if
not, by check mailed by first class mail to the address of such
Certificateholder appearing in the Certificate Register. The final distribution
on each Certificate will be made in like manner, but only upon presentment and
surrender of such Certificate at the offices designated by the Trustee for such
purposes, or such other location specified in the notice to Certificateholders
of such final distribution.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Servicers and the Trustee with the consent of the Holders
of Certificates affected by such amendment evidencing the requisite Percentage
Interest, as provided in the Agreement. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange therefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register of the Trustee upon surrender of this Certificate for
registration of transfer at the offices designated by the Trustee for such
purposes, accompanied by a written instrument of transfer in form satisfactory
to the Trustee and the Certificate Registrar duly executed by the holder hereof
or such holder's attorney duly authorized in writing, and thereupon one or more
new Certificates of the same Class in authorized denominations and evidencing
the same aggregate Percentage Interest in the Trust Fund will be issued to the
designated transferee or transferees.
The Certificates are issuable only as registered Certificates
without coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates are
exchangeable for new Certificates of the same Class in authorized denominations
and evidencing the same aggregate Percentage Interest, as requested by the
Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange, but the Trustee may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
The Depositor, the Servicers and the Trustee and any agent of the
Depositor or the Trustee may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and neither the Depositor, the
Trustee, nor any such agent shall be affected by any notice to the contrary.
On any Distribution Date on which the aggregate Stated Principal
Balance of the Mortgage Loans is less than or equal to 10% of the Original
Maximum Amount, either Servicer individually, or both Servicers together will
have the option to repurchase, in whole, from the Trust Fund all remaining
Mortgage Loans and all property acquired in respect of the Mortgage Loans at a
purchase price determined as provided in the Agreement. The obligations and
responsibilities created by the Agreement will terminate as provided in Section
9.01 of the Agreement.
Any term used herein that is defined in the Agreement shall have the
meaning assigned in the Agreement, and nothing herein shall be deemed
inconsistent with that meaning.
ASSIGNMENT
----------
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)
unto ___________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name and address
including postal zip code of assignee)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust Fund.
I (We) further direct the Trustee to issue a new Certificate of a
like denomination and Class, to the above named assignee and deliver such
Certificate to the following address:
_______________________________________________________________________________.
Dated:
_________________________________________
Signature by or on behalf of assignor
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to ______________________________________________,
_____________________________________________________________________________,
for the account of __________________________________________________________,
account number ______________, or, if mailed by check, to____________________.
Applicable statements should be mailed to____________________________________,
_____________________________________________________________________________.
This information is provided by__________________________________,
the assignee named above, or_________________________________________________,
as its agent.
EXHIBIT B
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
PROPOSED TRANSFEROR DELIVERS TO THE TRUSTEE A TRANSFEROR LETTER IN THE FORM OF
EXHIBIT H TO THE AGREEMENT REFERRED TO HEREIN AND EITHER (I) THE TRUSTEE
RECEIVES A RULE 144A LETTER IN THE FORM OF EXHIBIT I TO THE AGREEMENT REFERRED
TO HEREIN OR (II) THE TRUSTEE RECEIVES AN OPINION OF COUNSEL, DELIVERED AT THE
EXPENSE OF THE TRANSFEROR, THAT SUCH TRANSFER MAY BE MADE WITHOUT REGISTRATION
UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
TRANSFEREE DELIVERS TO THE TRUSTEE A REPRESENTATION LETTER TO THE EFFECT THAT
SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO THE TITLE I EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED, OR A PLAN SUBJECT TO SECTION
4975 OF THE CODE OR A PLAN SUBJECT TO APPLICABLE FEDERAL, STATE OR LOCAL LAW
("SIMILAR LAW") MATERIALLY SIMILAR TO THE FOREGOING PROVISIONS OF ERISA OR THE
CODE, OR A PERSON INVESTING ON BEHALF OF OR WITH PLAN ASSETS OF SUCH A PLAN.
NOTWITHSTANDING ANYTHING ELSE TO THE CONTRARY HEREIN, ANY PURPORTED TRANSFER OF
THIS CERTIFICATE TO OR ON BEHALF OF AN EMPLOYEE BENEFIT PLAN SUBJECT TO TITLE I
OF ERISA, SECTION 4975 OF THE CODE OR SIMILAR LAW WITHOUT THE REPRESENTATION
LETTER AS DESCRIBED ABOVE SHALL BE VOID AND OF NO EFFECT.
Certificate No. : 1
Cut-off Date : June 1, 2002
First Distribution Date : July 25, 2002
Percentage Interest of
this Certificate
("Denomination") : 100%
CUSIP :
XXXXXX XXXXXXX XXXX XXXXXX CAPITAL I INC.
Xxxxxx Xxxxxxx Xxxx Xxxxxx Capital I Inc. Trust 2002-HE1
Mortgage Pass-Through Certificates, Series 2002-HE1
Class P
evidencing a percentage interest in the distributions allocable to
the Certificates of the above-referenced Class.
Distributions in respect of this Certificate are distributable
monthly as set forth herein. This Certificate does not evidence an obligation
of, or an interest in, and is not guaranteed by the Depositor, the Servicers or
the Trustee referred to below or any of their respective affiliates. Neither
this Certificate nor the Mortgage Loans are guaranteed or insured by any
governmental agency or instrumentality.
This certifies that U.S. Bank National Association, as Indenture
Trustee, is the registered owner of the Percentage Interest evidenced by this
Certificate (obtained by dividing the denomination of this Certificate by the
aggregate of the denominations of all Certificates of the Class to which this
Certificate belongs) in certain monthly distributions pursuant to a Pooling and
Servicing Agreement dated as of the Cut-off Date specified above (the
"Agreement") among Xxxxxx Xxxxxxx Xxxx Xxxxxx Capital I Inc., as depositor (the
"Depositor"), Ocwen Federal Bank FSB, as a servicer ("Ocwen"), The Provident
Bank, as a servicer ("Provident" and, together with Ocwen, the "Servicers") and
U.S. Bank National Association, as trustee (the "Trustee"). To the extent not
defined herein, the capitalized terms used herein have the meanings assigned in
the Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
This Certificate does not have a Pass-Through Rate and will be
entitled to distributions only to the extent set forth in the Agreement. In
addition, any distribution of the proceeds of any remaining assets of the Trust
will be made only upon presentment and surrender of this Certificate at the
offices designated by the Trustee for such purpose, or the office or agency
maintained by the Trustee.
No transfer of a Certificate of this Class shall be made unless such
disposition is exempt from the registration requirements of the Securities Act
of 1933, as amended (the "1933 Act"), and any applicable state securities laws
or is made in accordance with the 1933 Act and such laws. In the event of any
such transfer, the Trustee shall require the transferor to execute a transferor
certificate (in substantially the form attached to the Pooling and Servicing
Agreement) and deliver either (i) a Rule 144A Letter, in either case
substantially in the form attached to the Agreement, or (ii) a written Opinion
of Counsel to the Trustee that such transfer may be made pursuant to an
exemption, describing the applicable exemption and the basis therefor, from the
1933 Act or is being made pursuant to the 1933 Act, which Opinion of Counsel
shall be an expense of the transferor.
No transfer of a Certificate of this Class shall be made unless the
Trustee shall have received a representation letter from the transferee of such
Certificate, acceptable to and in form and substance satisfactory to the
Trustee, to the effect that such transferee is not an employee benefit plan
subject to Section 406 of ERISA, Section 4975 of the Code or Similar Law, or a
person acting on behalf of or investing plan assets of any such plan, which
representation letter shall not be an expense of the Trustee.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually countersigned by an
authorized signatory of the Trustee.
* * *
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated:
U.S. BANK NATIONAL ASSOCIATION,
not in its individual capacity, but
solely as Trustee
By ____________________________________
Countersigned:
By ___________________________________
Authorized Signatory of
U.S. BANK NATIONAL ASSOCIATION,
not in its individual capacity,
but solely as Trustee
XXXXXX XXXXXXX XXXX XXXXXX CAPITAL I INC.
Xxxxxx Xxxxxxx Xxxx Xxxxxx Capital I Inc. Trust 2002-HE1
Mortgage Pass-Through Certificates
This Certificate is one of a duly authorized issue of Certificates
designated as Xxxxxx Xxxxxxx Xxxx Xxxxxx Capital I Inc. Trust 2002-HE1 Mortgage
Pass-Through Certificates, of the Series specified on the face hereof (herein
collectively called the "Certificates"), and representing a beneficial ownership
interest in the Trust Fund created by the Agreement.
The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
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 thereby, and the rights,
duties and immunities of the Trustee.
Pursuant to the terms of the Agreement, a distribution will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (the "Distribution Date"), commencing on the
first Distribution Date specified on the face hereof, to the Person in whose
name this Certificate is registered at the close of business on the applicable
Record Date in an amount equal to the product of the Percentage Interest
evidenced by this Certificate and the amount required to be distributed to
Holders of Certificates of the Class to which this Certificate belongs on such
Distribution Date pursuant to the Agreement. The Record Date applicable to each
Distribution Date is the last Business Day of the month next preceding the month
of such Distribution Date.
Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or
other entity having appropriate facilities therefor, if such Certificateholder
shall have so notified the Trustee in writing at least five Business Days prior
to the related Record Date and such Certificateholder shall satisfy the
conditions to receive such form of payment set forth in the Agreement, or, if
not, by check mailed by first class mail to the address of such
Certificateholder appearing in the Certificate Register. The final distribution
on each Certificate will be made in like manner, but only upon presentment and
surrender of such Certificate at the offices designated by the Trustee for such
purposes or such other location specified in the notice to Certificateholders of
such final distribution.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Servicers and the Trustee with the consent of the Holders
of Certificates affected by such amendment evidencing the requisite Percentage
Interest, as provided in the Agreement. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange therefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register of the Trustee upon surrender of this Certificate for
registration of transfer at the offices designated by the Trustee for such
purposes or the office or agency maintained by the Trustee in New York, New
York, accompanied by a written instrument of transfer in form satisfactory to
the Trustee and the Certificate Registrar duly executed by the holder hereof or
such holder's attorney duly authorized in writing, and thereupon one or more new
Certificates of the same Class in authorized denominations and evidencing the
same aggregate Percentage Interest in the Trust Fund will be issued to the
designated transferee or transferees.
The Certificates are issuable only as registered Certificates
without coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates are
exchangeable for new Certificates of the same Class in authorized denominations
and evidencing the same aggregate Percentage Interest, as requested by the
Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange, but the Trustee may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
The Depositor, the Servicers and the Trustee and any agent of the
Depositor or the Trustee may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and neither the Depositor, the
Trustee, nor any such agent shall be affected by any notice to the contrary.
On any Distribution Date on which the aggregate Stated Principal
Balance of the Mortgage Loans is less than or equal to 10% of the Original
Maximum Amount, either Servicer individually, or both Servicers together will
have the option to repurchase, in whole, from the Trust Fund all remaining
Mortgage Loans and all property acquired in respect of the Mortgage Loans at a
purchase price determined as provided in the Agreement. The obligations and
responsibilities created by the Agreement will terminate as provided in Section
9.01 of the Agreement.
Any term used herein that is defined in the Agreement shall have the
meaning assigned in the Agreement, and nothing herein shall be deemed
inconsistent with that meaning.
ASSIGNMENT
----------
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)
unto ___________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name and address
including postal zip code of assignee)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust Fund.
I (We) further direct the Trustee to issue a new Certificate of a
like denomination and Class, to the above named assignee and deliver such
Certificate to the following address:
_______________________________________________________________________________.
Dated:
_________________________________________
Signature by or on behalf of assignor
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to ______________________________________________,
_____________________________________________________________________________,
for the account of __________________________________________________________,
account number ______________, or, if mailed by check, to____________________.
Applicable statements should be mailed to____________________________________,
_____________________________________________________________________________.
This information is provided by__________________________________,
the assignee named above, or_________________________________________________,
as its agent.
EXHIBIT C
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "RESIDUAL
INTEREST" IN TWO "REAL ESTATE MORTGAGE INVESTMENT CONDUITS," AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE "CODE").
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
PROPOSED TRANSFEREE DELIVERS TO THE TRUSTEE A TRANSFER AFFIDAVIT IN ACCORDANCE
WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED (i) TO A
PERMITTED TRANSFEREE IN COMPLIANCE WITH SECTION 5.02(c) OF THE AGREEMENT, OR
(ii) UNLESS THE TRANSFEREE DELIVERS TO THE TRUSTEE A REPRESENTATION LETTER TO
THE EFFECT THAT SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED, OR A PLAN SUBJECT
TO SECTION 4975 OF THE CODE OR A PLAN SUBJECT TO MATERIALLY SIMILAR PROVISIONS
OF APPLICABLE FEDERAL, STATE OR LOCAL LAW ("SIMILAR LAW") OR A PERSON INVESTING
ON BEHALF OF OR WITH PLAN ASSETS OF SUCH A PLAN. In the event that such
representation is violated, or any attempt IS MADE to transfer to a plan or
arrangement subject to Section 406 of ERISA, a plan subject to Section 4975 of
the Code OR A PLAN SUBJECT TO SIMILAR LAW, or a person acting on behalf of any
such plan or arrangement or using the assets of any such plan or arrangement,
such attempted transfer or acquisition shall be void and of no effect.
Certificate No. : 1
Cut-off Date : June 1, 2002
First Distribution Date : July 25, 2002
Percentage Interest of : 100%
this Certificate
("Denomination")
CUSIP :
XXXXXX XXXXXXX XXXX XXXXXX CAPITAL I INC.
Xxxxxx Xxxxxxx Xxxx Xxxxxx Capital I Inc. Trust 2002-HE1
Mortgage Pass-Through Certificates, Series 2002-HE1
Class R
evidencing a percentage interest in the distributions allocable
to the Certificates of the above-referenced Class.
Distributions in respect of this Certificate is distributable
monthly as set forth herein. This Class R Certificate has no Certificate Balance
and is not entitled to distributions in respect of principal or interest. This
Certificate does not evidence an obligation of, or an interest in, and is not
guaranteed by the Depositor, the Servicers or the Trustee referred to below or
any of their respective affiliates. Neither this Certificate nor the Mortgage
Loans are guaranteed or insured by any governmental agency or instrumentality.
This certifies that Xxxxxx Xxxxxxx & Co. Incorporated is the
registered owner of the Percentage Interest specified above of any monthly
distributions due to the Class R Certificates pursuant to a Pooling and
Servicing Agreement dated as of the Cut-Off Date specified above (the
"Agreement") among Xxxxxx Xxxxxxx Xxxx Xxxxxx Capital I Inc., as depositor (the
"Depositor"), Ocwen Federal Bank FSB, as a servicer ("Ocwen"), The Provident
Bank, as a servicer ("Provident" and, together with Ocwen, the "Servicers") and
U.S. Bank National Association, as trustee (the "Trustee"). To the extent not
defined herein, the capitalized terms used herein have the meanings assigned in
the Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
Any distribution of the proceeds of any remaining assets of the
Trust Fund will be made only upon presentment and surrender of this Class R
Certificate at the offices designated by the Trustee for such purposes or the
office or agency maintained by the Trustee in California.
No transfer of a Class R Certificate shall be made unless the
Trustee shall have received a representation letter from the transferee of such
Certificate, acceptable to and in form and substance satisfactory to the
Trustee, to the effect that such transferee is not an employee benefit plan or
arrangement subject to Section 406 of ERISA, a plan or arrangement subject to
Section 4975 of the Code or a plan subject to Similar Law, or a person acting on
behalf of any such plan or arrangement nor using the assets of any such plan or
arrangement to effect such transfer, which representation letter shall not be an
expense of the Trustee, the Servicer or the Trust Fund. In the event that such
representation is violated, or any attempt is made to transfer to a plan or
arrangement subject to Section 406 of ERISA or a plan subject to Section 4975 of
the Code or a plan subject to Similar Law, or a person acting on behalf of any
such plan or arrangement or using the assets of any such plan or arrangement,
such attempted transfer or acquisition shall be void and of no effect.
Each Holder of this Class R Certificate shall be deemed by the
acceptance or acquisition an Ownership Interest in this Class R Certificate to
have agreed to be bound by the following provisions, and the rights of each
Person acquiring any Ownership Interest in this Class R Certificate are
expressly subject to the following provisions: (i) each Person holding or
acquiring any Ownership Interest in this Class R Certificate shall be a
Permitted Transferee and shall promptly notify the Trustee of any change or
impending change in its status as a Permitted Transferee, (ii) no Ownership
Interest in this Class R Certificate may be registered on the Closing Date or
thereafter transferred, and the Trustee shall not register the Transfer of this
Certificate unless, in addition to the certificates required to be delivered to
the Trustee under Section 5.02(b) of the Agreement, the Trustee shall have been
furnished with a Transfer Affidavit of the initial owner or the proposed
transferee in the form attached as Exhibit G to the Agreement, (iii) each Person
holding or acquiring any Ownership Interest in this Class R Certificate shall
agree (A) to obtain a Transfer Affidavit from any other Person to whom such
Person attempts to Transfer its Ownership Interest this Class R Certificate, (B)
to obtain a Transfer Affidavit from any Person for whom such Person is acting as
nominee, trustee or agent in connection with any Transfer of this Class R
Certificate and (C) not to Transfer the Ownership Interest in this Class R
Certificate or to cause the Transfer of the Ownership Interest in this Class R
Certificate to any other Person if it has actual knowledge that such Person is
not a Permitted Transferee and (iv) any attempted or purported Transfer of the
Ownership Interest in this Class R Certificate in violation of the provisions
herein shall be absolutely null and void and shall vest no rights in the
purported Transferee.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually countersigned by an
authorized signatory of the Trustee.
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated:
U.S. BANK NATIONAL ASSOCIATION,
not in its individual capacity, but
solely as Trustee
By __________________________________
Countersigned:
By _______________________________
Authorized Signatory of
U.S. BANK NATIONAL ASSOCIATION,
not in its individual capacity,
but solely as Trustee
Xxxxxx Xxxxxxx Xxxx Xxxxxx Capital I Inc. Trust 2002-HE1
Mortgage Pass-Through Certificates
This Certificate is one of a duly authorized issue of Certificates
designated as Xxxxxx Xxxxxxx Xxxx Xxxxxx Capital I Inc. Trust 2002-HE1 Mortgage
Pass-Through Certificates, of the Series specified on the face hereof (herein
collectively called the "Certificates"), and representing a beneficial ownership
interest in the Trust Fund created by the Agreement.
The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
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 thereby, and the rights,
duties and immunities of the Trustee.
Pursuant to the terms of the Agreement, a distribution will be made
on the 25th day of each month or, if such day is not a Business Day, the
Business Day immediately following (the "Distribution Date"), commencing on the
first Distribution Date specified on the face hereof, to the Person in whose
name this Certificate is registered at the close of business on the applicable
Record Date in an amount equal to the product of the Percentage Interest
evidenced by this Certificate and the amount required to be distributed to
Holders of Certificates of the Class to which this Certificate belongs on such
Distribution Date pursuant to the Agreement. The Record Date applicable to each
Distribution Date is the last Business Day of the month next preceding the month
of such Distribution Date.
Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or
other entity having appropriate facilities therefor, if such Certificateholder
shall have so notified the Trustee in writing at least five Business Days prior
to the related Record Date and such Certificateholder shall satisfy the
conditions to receive such form of payment set forth in the Agreement, or, if
not, by check mailed by first class mail to the address of such
Certificateholder appearing in the Certificate Register. The final distribution
on each Certificate will be made in like manner, but only upon presentment and
surrender of such Certificate at the offices designated by the Trustee for such
purposes or such other location specified in the notice to Certificateholders of
such final distribution.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Servicers and the Trustee with the consent of the Holders
of Certificates affected by such amendment evidencing the requisite Percentage
Interest, as provided in the Agreement. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange therefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register of the Trustee upon surrender of this Certificate for
registration of transfer at the offices designated by the Trustee for such
purposes or the office or agency maintained by the Trustee in New York, New
York, accompanied by a written instrument of transfer in form satisfactory to
the Trustee and the Certificate Registrar duly executed by the holder hereof or
such holder's attorney duly authorized in writing, and thereupon one or more new
Certificates of the same Class in authorized denominations and evidencing the
same aggregate Percentage Interest in the Trust Fund will be issued to the
designated transferee or transferees.
The Certificates are issuable only as registered Certificates
without coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates are
exchangeable for new Certificates of the same Class in authorized denominations
and evidencing the same aggregate Percentage Interest, as requested by the
Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange, but the Trustee may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
The Depositor, the Servicers and the Trustee and any agent of the
Depositor or the Trustee may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and neither the Depositor, the
Trustee, nor any such agent shall be affected by any notice to the contrary.
On any Distribution Date on which the aggregate Stated Principal
Balance of the Mortgage Loans is less than or equal to 10% of the Original
Maximum Amount, either Servicer individually, or both Servicers together, will
have the option to repurchase, in whole, from the Trust Fund all remaining
Mortgage Loans and all property acquired in respect of the Mortgage Loans at a
purchase price determined as provided in the Agreement. The obligations and
responsibilities created by the Agreement will terminate as provided in Section
9.01 of the Agreement.
Any term used herein that is defined in the Agreement shall have the
meaning assigned in the Agreement, and nothing herein shall be deemed
inconsistent with that meaning.
ASSIGNMENT
----------
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)
unto ___________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name and address
including postal zip code of assignee)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust Fund.
I (We) further direct the Trustee to issue a new Certificate of a
like denomination and Class, to the above named assignee and deliver such
Certificate to the following address:
_______________________________________________________________________________.
Dated:
_________________________________________
Signature by or on behalf of assignor
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to ______________________________________________,
_____________________________________________________________________________,
for the account of __________________________________________________________,
account number ______________, or, if mailed by check, to____________________.
Applicable statements should be mailed to____________________________________,
_____________________________________________________________________________.
This information is provided by__________________________________,
the assignee named above, or_________________________________________________,
as its agent.
EXHIBIT D
SOLELY FOR U.S. FEDERAL INCOME TAX PURPOSES, THIS CERTIFICATE IS A "REGULAR
INTEREST" IN A "REAL ESTATE MORTGAGE INVESTMENT CONDUIT," AS THOSE TERMS ARE
DEFINED, RESPECTIVELY, IN SECTIONS 860G AND 860D OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE "CODE").
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
PROPOSED TRANSFEROR DELIVERS TO THE TRUSTEE A TRANSFEROR LETTER IN THE FORM OF
EXHIBIT H TO THE AGREEMENT REFERRED TO HEREIN AND EITHER (I) THE TRUSTEE
RECEIVES A RULE 144A LETTER IN THE FORM OF EXHIBIT I TO THE AGREEMENT REFERRED
TO HEREIN OR (II) THE TRUSTEE RECEIVES AN OPINION OF COUNSEL, DELIVERED AT THE
EXPENSE OF THE TRANSFEROR, THAT SUCH TRANSFER MAY BE MADE WITHOUT REGISTRATION
UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
NEITHER THIS CERTIFICATE NOR ANY INTEREST HEREIN MAY BE TRANSFERRED UNLESS THE
TRANSFEREE DELIVERS TO THE TRUSTEE EITHER A REPRESENTATION LETTER TO THE EFFECT
THAT SUCH TRANSFEREE IS NOT AN EMPLOYEE BENEFIT PLAN SUBJECT TO THE EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED, OR A PLAN SUBJECT TO SECTION
4975 OF THE CODE, or a plan subject to applicable Federal, state or local law
("Similar Law") materially similar to the foregoing provisions of ERISA or the
Code or a person acting on behalf of or investing plan assets of any such plan,
other than an insurance company which is purchasing such Certificates with funds
contained in an "insurance company general account" (as such term is defined in
Section V(e) of Prohibited Transaction Class Exemption 95-60 ("PTCE 95-60"))
under such conditions that the purchase and holding of this Certificate are
covered under Sections I and III of PTCE 95-60, OR AN OPINION OF COUNSEL IN
ACCORDANCE WITH THE PROVISIONS OF THE AGREEMENT REFERRED TO HEREIN.
NOTWITHSTANDING ANYTHING ELSE TO THE CONTRARY HEREIN, ANY PURPORTED TRANSFER OF
THIS CERTIFICATE TO OR ON BEHALF OF AN EMPLOYEE BENEFIT PLAN SUBJECT TO ERISA OR
TO THE CODE WITHOUT THE REPRESENTATION LETTER OR THE OPINION OF COUNSEL
SATISFACTORY TO THE TRUSTEE AS DESCRIBED ABOVE SHALL BE VOID AND OF NO EFFECT.
Certificate No. : 1
Cut-off Date : June 1, 2002
First Distribution Date : July 25, 2002
Percentage Interest of this
Certificate ("Denomination") : 100%
CUSIP :
XXXXXX XXXXXXX XXXX XXXXXX CAPITAL I INC.
Xxxxxx Xxxxxxx Xxxx Xxxxxx Capital I Inc. Trust 2002-HE1
Mortgage Pass-Through Certificates, Series 2002-HE1
Class X
evidencing a percentage interest in the distributions allocable
to the Certificates of the above-referenced Class.
Distributions in respect of this Certificate are distributable
monthly as set forth herein. This Certificate does not evidence an obligation
of, or an interest in, and is not guaranteed by the Depositor, the Servicers or
the Trustee referred to below or any of their respective affiliates. Neither
this Certificate nor the Mortgage Loans are guaranteed or insured by any
governmental agency or instrumentality.
This certifies that U.S. Bank National Association, as Indenture
Trustee, is the registered owner of the Percentage Interest evidenced by this
Certificate (obtained by dividing the denomination of this Certificate by the
aggregate of the denominations of all Certificates of the Class to which this
Certificate belongs) in certain monthly distributions pursuant to a Pooling and
Servicing Agreement dated as of the Cut-off Date specified above (the
"Agreement") among Xxxxxx Xxxxxxx Xxxx Xxxxxx Capital I Inc., as depositor (the
"Depositor"), Ocwen Federal Bank FSB, as a servicer ("Ocwen"), The Provident
Bank, as a servicer ("Provident" and, together with Ocwen, the "Servicers") and
U.S. Bank National Association, as trustee (the "Trustee"). To the extent not
defined herein, the capitalized terms used herein have the meanings assigned in
the Agreement. This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement the Holder of
this Certificate by virtue of the acceptance hereof assents and by which such
Holder is bound.
This Certificate does not have a Certificate Balance or Pass-Through
Rate and will be entitled to distributions only to the extent set forth in the
Agreement. In addition, any distribution of the proceeds of any remaining assets
of the Trust will be made only upon presentment and surrender of this
Certificate at the offices designated by the Trustee for such purposes or the
office or agency maintained by the Trustee.
No transfer of a Certificate of this Class shall be made unless such
disposition is exempt from the registration requirements of the Securities Act
of 1933, as amended (the "1933 Act"), and any applicable state securities laws
or is made in accordance with the 1933 Act and such laws. In the event of any
such transfer, the Trustee shall require the transferor to execute a transferor
certificate (in substantially the form attached to the Pooling and Servicing
Agreement) and deliver either (i) a Rule 144A Letter, in either case
substantially in the form attached to the Agreement, or (ii) a written Opinion
of Counsel to the Trustee that such transfer may be made pursuant to an
exemption, describing the applicable exemption and the basis therefor, from the
1933 Act or is being made pursuant to the 1933 Act, which Opinion of Counsel
shall be an expense of the transferor.
No transfer of a Certificate of this Class shall be made unless the
Trustee shall have received either (i) a representation letter from the
transferee of such Certificate, acceptable to and in form and substance
satisfactory to the Trustee, to the effect that such transferee is not an
employee benefit plan subject to Section 406 of ERISA or Section 4975 of the
Code or any materially similar provisions of applicable Federal, state or local
law ("Similar Law") or a person acting on behalf of or investing plan assets of
any such plan, which representation letter shall not be an expense of the
Trustee, or (ii) if the purchaser is an insurance company, a representation that
the purchaser is an insurance company which is purchasing such Certificates with
funds contained in an "insurance company general account" (as such term is
defined in Section V(e) of Prohibited Transaction Class Exemption 95-60 ("PTCE
95-60")) and that the purchase and holding of such Certificates are covered
under Sections I and III of PTCE 95-60, or (iii) in the case of a Certificate
presented for registration in the name of an employee benefit plan subject to
ERISA, or a plan or arrangement subject to Section 4975 of the Code (or
comparable provisions of any subsequent enactments) or a plan subject to Similar
Law, or a trustee of any such plan or any other person acting on behalf of any
such plan or arrangement or using such plan's or arrangement's assets, an
Opinion of Counsel satisfactory to the Trustee and the Servicer, which Opinion
of Counsel shall not be an expense of the Trustee, the Servicer or the Trust
Fund, addressed to the Trustee, to the effect that the purchase or holding of
such Certificate will not result in the assets of the Trust Fund being deemed to
be "plan assets" and subject to the prohibited transaction provisions of ERISA
and the Code and will not subject the Trustee or the Servicer to any obligation
in addition to those expressly undertaken in this Agreement or to any liability.
Reference is hereby made to the further provisions of this
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
This Certificate shall not be entitled to any benefit under the
Agreement or be valid for any purpose unless manually countersigned by an
authorized signatory of the Trustee.
* * *
IN WITNESS WHEREOF, the Trustee has caused this Certificate to be
duly executed.
Dated:
U.S. BANK NATIONAL ASSOCIATION,
not in its individual capacity, but
solely as Trustee
By __________________________________
Countersigned:
By _________________________________
Authorized Signatory of
U.S. BANK NATIONAL ASSOCIATION,
not in its individual capacity,
but solely as Trustee
XXXXXX XXXXXXX XXXX XXXXXX CAPITAL I INC.
Xxxxxx Xxxxxxx Xxxx Xxxxxx Capital I Inc. Trust 2002-HE1
Mortgage Pass-Through Certificates
This Certificate is one of a duly authorized issue of Certificates
designated as Xxxxxx Xxxxxxx Xxxx Xxxxxx Capital I Inc. Trust 2002-HE1 Mortgage
Pass-Through Certificates, of the Series specified on the face hereof (herein
collectively called the "Certificates"), and representing a beneficial ownership
interest in the Trust Fund created by the Agreement.
The Certificateholder, by its acceptance of this Certificate, agrees
that it will look solely to the funds on deposit in the Distribution Account for
payment hereunder and that the Trustee is not liable to the Certificateholders
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 thereby, and the rights,
duties and immunities of the Trustee.
Pursuant to the terms of the Agreement, a distribution will be made
on the 25th day of each month or, if such 25th day is not a Business Day, the
Business Day immediately following (the "Distribution Date"), commencing on the
first Distribution Date specified on the face hereof, to the Person in whose
name this Certificate is registered at the close of business on the applicable
Record Date in an amount equal to the product of the Percentage Interest
evidenced by this Certificate and the amount required to be distributed to
Holders of Certificates of the Class to which this Certificate belongs on such
Distribution Date pursuant to the Agreement. The Record Date applicable to each
Distribution Date is the last Business Day of the month next preceding the month
of such Distribution Date.
Distributions on this Certificate shall be made by wire transfer of
immediately available funds to the account of the Holder hereof at a bank or
other entity having appropriate facilities therefor, if such Certificateholder
shall have so notified the Trustee in writing at least five Business Days prior
to the related Record Date and such Certificateholder shall satisfy the
conditions to receive such form of payment set forth in the Agreement, or, if
not, by check mailed by first class mail to the address of such
Certificateholder appearing in the Certificate Register. The final distribution
on each Certificate will be made in like manner, but only upon presentment and
surrender of such Certificate at the offices designated by the Trustee for such
purposes or such other location specified in the notice to Certificateholders of
such final distribution.
The Agreement permits, with certain exceptions therein provided, the
amendment thereof and the modification of the rights and obligations of the
Trustee and the rights of the Certificateholders under the Agreement at any time
by the Depositor, the Servicers and the Trustee with the consent of the Holders
of Certificates affected by such amendment evidencing the requisite Percentage
Interest, as provided in the Agreement. Any such consent by the Holder of this
Certificate shall be conclusive and binding on such Holder and upon all future
Holders of this Certificate and of any Certificate issued upon the transfer
hereof or in exchange therefor or in lieu hereof whether or not notation of such
consent is made upon this Certificate. The Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the Holders of
any of the Certificates.
As provided in the Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate is registrable in the
Certificate Register of the Trustee upon surrender of this Certificate for
registration of transfer at the offices designated by the Trustee for such
purposes or the office or agency maintained by the Trustee in New York, New
York, accompanied by a written instrument of transfer in form satisfactory to
the Trustee and the Certificate Registrar duly executed by the holder hereof or
such holder's attorney duly authorized in writing, and thereupon one or more new
Certificates of the same Class in authorized denominations and evidencing the
same aggregate Percentage Interest in the Trust Fund will be issued to the
designated transferee or transferees.
The Certificates are issuable only as registered Certificates
without coupons in denominations specified in the Agreement. As provided in the
Agreement and subject to certain limitations therein set forth, Certificates are
exchangeable for new Certificates of the same Class in authorized denominations
and evidencing the same aggregate Percentage Interest, as requested by the
Holder surrendering the same.
No service charge will be made for any such registration of transfer
or exchange, but the Trustee may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
The Depositor, the Servicers and the Trustee and any agent of the
Depositor or the Trustee may treat the Person in whose name this Certificate is
registered as the owner hereof for all purposes, and neither the Depositor, the
Trustee, nor any such agent shall be affected by any notice to the contrary.
On any Distribution Date on which the aggregate Stated Principal
Balance of the Mortgage Loans is less than or equal to 10% of the Original
Maximum Amount, either Servicer individually, or both Servicers together, will
have the option to repurchase, in whole, from the Trust Fund all remaining
Mortgage Loans and all property acquired in respect of the Mortgage Loans at a
purchase price determined as provided in the Agreement. The obligations and
responsibilities created by the Agreement will terminate as provided in Section
9.01 of the Agreement.
Any term used herein that is defined in the Agreement shall have the
meaning assigned in the Agreement, and nothing herein shall be deemed
inconsistent with that meaning.
ASSIGNMENT
----------
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)
unto ___________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name and address
including postal zip code of assignee)
the Percentage Interest evidenced by the within Certificate and hereby
authorizes the transfer of registration of such Percentage Interest to assignee
on the Certificate Register of the Trust Fund.
I (We) further direct the Trustee to issue a new Certificate of a
like denomination and Class, to the above named assignee and deliver such
Certificate to the following address:
_______________________________________________________________________________.
Dated:
_________________________________________
Signature by or on behalf of assignor
DISTRIBUTION INSTRUCTIONS
The assignee should include the following for purposes of
distribution:
Distributions shall be made, by wire transfer or otherwise, in
immediately available funds to ______________________________________________,
_____________________________________________________________________________,
for the account of __________________________________________________________,
account number ______________, or, if mailed by check, to____________________.
Applicable statements should be mailed to____________________________________,
_____________________________________________________________________________.
This information is provided by__________________________________,
the assignee named above, or_________________________________________________,
as its agent.
EXHIBIT E
FORM OF INITIAL CERTIFICATION OF TRUSTEE
[date]
[Depositor]
[Servicers]
[Originators]
______________________
______________________
Re: Pooling and Servicing Agreement among Xxxxxx Xxxxxxx Xxxx
Xxxxxx Capital I Inc., as Depositor, Ocwen Federal Bank FSB,
as a Servicer, The Provident Bank, as a Servicer and U.S. Bank
National Association, as Trustee, Xxxxxx Xxxxxxx Xxxx Xxxxxx
Capital I Inc. Trust, Series 2002-HE1
--------------------------------------------------------------
Gentlemen:
In accordance with Section 2.02 of the above-captioned Pooling and
Servicing Agreement (the "Pooling and Servicing Agreement"), for each Mortgage
Loan listed in the Mortgage Loan Schedule (other than any Mortgage Loan listed
in the attached schedule), it has received:
(i) the original Mortgage Note, endorsed as provided in the
following form: "Pay to the order of ________, without recourse"; and
(ii) a duly executed assignment of the Mortgage (which may be
included in a blanket assignment or assignments).
Based on its review and examination and only as to the foregoing
documents, such documents appear regular on their face and related to such
Mortgage Loan.
The Trustee has made no independent examination of any documents
contained in each Mortgage File beyond the review specifically required in the
Pooling and Servicing Agreement. The Trustee makes no representations as to: (i)
the validity, legality, sufficiency, enforceability or genuineness of any of the
documents contained in each Mortgage File of any of the Mortgage Loans
identified on the Mortgage Loan Schedule, or (ii) the collectability,
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 Pooling and Servicing Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:____________________________________
Name:__________________________________
Title:_________________________________
EXHIBIT F
FORM OF FINAL CERTIFICATION OF TRUSTEE
[date]
[Depositor]
[Servicers]
[Originators]
________________________
________________________
Re: Pooling and Servicing Agreement among Xxxxxx Xxxxxxx Xxxx
Xxxxxx Capital I Inc., as Depositor, Ocwen Federal Bank FSB,
as a Servicer, The Provident Bank, as a Servicer and U.S. Bank
National Association, as Trustee, Xxxxxx Xxxxxxx Xxxx Xxxxxx
Capital I Inc. Trust, Series 2002-HE1
--------------------------------------------------------------
Gentlemen:
In accordance with Section 2.02 of the above-captioned Pooling and
Servicing Agreement (the "Pooling and Servicing Agreement"), the undersigned, as
Trustee, hereby certifies that as to each Mortgage Loan listed in the Mortgage
Loan Schedule (other than any Mortgage Loan paid in full or listed on the
attached Document Exception Report) it has received:
(i) The original Mortgage Note, endorsed in the form provided in
Section 2.01 of the Pooling and Servicing Agreement, with all intervening
endorsements showing a complete chain of endorsement from the originator
to the last endorsee.
(ii) The original recorded Mortgage.
(iii) A duly executed assignment of the Mortgage in the form
provided in Section 2.01 of the Pooling and Servicing Agreement; or, if
the Depositor has certified or the Trustee otherwise knows that the
related Mortgage has not been returned from the applicable recording
office, a copy of the assignment of the Mortgage (excluding information to
be provided by the recording office).
(iv) The original or duplicate original recorded assignment or
assignments of the Mortgage showing a complete chain of assignment from
the originator to the last endorsee.
(v) The original or duplicate original lender's title policy and all
riders thereto or, any one of an original title binder, an original
preliminary title report or an original title commitment, or a copy
thereof certified by the title company.
Based on its review and examination and only as to the foregoing
documents, (a) such documents appear regular on their face and related to such
Mortgage Loan, and (b) the information set forth in items (1), (2), (7), and (9)
of the Mortgage Loan Schedule and items (1), (9) and (17) of the Data Tape
Information accurately reflects information set forth in the Custodial File.
The Trustee has made no independent examination of any documents
contained in each Mortgage File beyond the review of the Custodial File
specifically required in the Pooling and Servicing Agreement. The Trustee makes
no representations as to: (i) the validity, legality, sufficiency,
enforceability or genuineness of any of the documents contained in each Mortgage
File of any of the Mortgage Loans identified on the Mortgage Loan Schedule, or
(ii) the collectability, insurability, effectiveness or suitability of any such
Mortgage Loan. Notwithstanding anything herein to the contrary, the Trustee has
made no determination and makes no representations as to whether (i) any
endorsement is sufficient to transfer all right, title and interest of the party
so endorsing, as Noteholder or assignee thereof, in and to that Mortgage Note or
(ii) any assignment is in recordable form or sufficient to effect the assignment
of and transfer to the assignee thereof, under the Mortgage to which the
assignment relates.
Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the Pooling and Servicing Agreement.
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:____________________________________
Name:__________________________________
Title:_________________________________
EXHIBIT G
TRANSFER AFFIDAVIT
Xxxxxx Xxxxxxx Xxxx Xxxxxx Capital I Inc. Trust 2002-HE1,
Mortgage Pass-Through Certificates,
Series 2002-HE1
STATE OF )
) ss.:
COUNTY OF )
The undersigned, being first duly sworn, deposes and says as
follows:
1. The undersigned is an officer of ___________________, the
proposed Transferee of an Ownership Interest in a Class R Certificate (the
"Certificate") issued pursuant to the Pooling and Servicing Agreement (the
"Agreement"), relating to the above-referenced Series, by and among Xxxxxx
Xxxxxxx Xxxx Xxxxxx Capital I Inc., as depositor (the "Depositor"), Ocwen
Federal Bank FSB, as a servicer ("Ocwen"), The Provident Bank, as a servicer
("Provident" and, together with Ocwen, the "Servicers") and U.S. Bank National
Association, as trustee (the "Trustee"). Capitalized terms used, but not defined
herein or in Exhibit 1 hereto, shall have the meanings ascribed to such terms in
the Agreement. The Transferee has authorized the undersigned to make this
affidavit on behalf of the Transferee for the benefit of the Depositor and the
Trustee.
2. The Transferee is, as of the date hereof, and will be, as of the
date of the Transfer, a Permitted Transferee. The Transferee is acquiring its
Ownership Interest in the Certificate for its own account. The Transferee has no
knowledge that any such affidavit is false.
3. The Transferee has been advised of, and understands that (i) a
tax will be imposed on Transfers of the Certificate to Persons that are not
Permitted Transferees; (ii) such tax will be imposed on the transferor, or, if
such Transfer is through an agent (which includes a broker, nominee or
middleman) for a Person that is not a Permitted Transferee, on the agent; and
(iii) the Person otherwise liable for the tax shall be relieved of liability for
the tax if the subsequent Transferee furnished to such Person an affidavit that
such subsequent Transferee is a Permitted Transferee and, at the time of
Transfer, such Person does not have actual knowledge that the affidavit is
false.
4. The Transferee has been advised of, and understands that a tax
will be imposed on a "pass-through entity" holding the Certificate if at any
time during the taxable year of the pass-through entity a Person that is not a
Permitted Transferee is the record holder of an interest in such entity. The
Transferee understands that such tax will not be imposed for any period with
respect to which the record holder furnishes to the pass-through entity an
affidavit that such record holder is a Permitted Transferee and the pass-through
entity does not have actual knowledge that such affidavit is false. (For this
purpose, a "pass-through entity" includes a regulated investment company, a real
estate investment trust or common trust fund, a partnership, trust or estate,
and certain cooperatives and, except as may be provided in Treasury Regulations,
persons holding interests in pass-through entities as a nominee for another
Person.)
5. The Transferee has reviewed the provisions of Section 5.02(c) of
the Agreement and understands the legal consequences of the acquisition of an
Ownership Interest in the Certificate including, without limitation, the
restrictions on subsequent Transfers and the provisions regarding voiding the
Transfer and mandatory sales. The Transferee expressly agrees to be bound by and
to abide by the provisions of Section 5.02(c) of the Agreement and the
restrictions noted on the face of the Certificate. The Transferee understands
and agrees that any breach of any of the representations included herein shall
render the Transfer to the Transferee contemplated hereby null and void.
6. The Transferee agrees to require a Transfer Affidavit from any
Person to whom the Transferee attempts to Transfer its Ownership Interest in the
Certificate, and in connection with any Transfer by a Person for whom the
Transferee is acting as nominee, trustee or agent, and the Transferee will not
Transfer its Ownership Interest or cause any Ownership Interest to be
Transferred to any Person that the Transferee knows is not a Permitted
Transferee. In connection with any such Transfer by the Transferee, the
Transferee agrees to deliver to the Trustee a certificate substantially in the
form set forth as Exhibit H to the Agreement (a "Transferor Certificate") to the
effect that, among other things, such Transferee has no actual knowledge that
the Person to which the Transfer is to be made is not a Permitted Transferee.
7. The Transferee does not have the intention to impede the
assessment or collection of any tax legally required to be paid with respect to
the Certificate. The Transferee has historically paid its debts as they have
come due and intends to pay its debts as they come due in the future. The
Transferee intends to pay all taxes due with respect to the Certificate as they
become due.
8. The Transferee's taxpayer identification number is __________.
9. The Transferee is a U.S. Person as defined in Code Section
7701(a)(30).
10. The Transferee is aware that the Certificate may be a
"noneconomic residual interest" within the meaning of proposed Treasury
regulations promulgated pursuant to the Code and that the transferor of a
noneconomic residual interest will remain liable for any taxes due with respect
to the income on such residual interest, unless no significant purpose of the
transfer was to impede the assessment or collection of tax.
11. Check the applicable paragraph:
|_| The Transferee has computed any consideration paid to it to
acquire the Class R Certificate in accordance with proposed U.S. Treasury
Regulations Sections 1.860E-1(a)(4)(iii) and 1.860E-1(c)(5) (or, after they have
been finalized, the final regulations) by computing present values using a
discount rate equal to the applicable Federal rate prescribed by Section 1274(d)
of the Code, compounded semi-annually.
|_| The Transferee has computed any consideration paid to it to
acquire the Class R Certificate in accordance with proposed U.S. Treasury
Regulations Sections 1.860E-1(a)(4)(iii) and 1.860E-1(c)(5) (or, after they have
been finalized, the final regulations) by computing present values using a
discount rate at least equal to the rate at which the Transferee regularly
borrows, in the ordinary course of its trade or business, substantial funds from
unrelated third parties. The Transferee has provided all information necessary
to demonstrate to the transferor that it regularly borrows at such rate.
|_| The transfer of the Class R Certificate complies with Section
6 of Revenue Procedure 2001-12 (the "Revenue Procedure"), 2001-3 I.R.B. 335
(January 16, 2001) (or comparable provisions of applicable final U.S. Treasury
Regulations) and, accordingly,
(i) the Transferee is an "eligible corporation," as defined in
Section 860L(a)(2) of the Code, as to which income from Class
R Certificate will only be taxed in the United States;
(ii) at the time of the transfer, and at the close of the
Transferee's two fiscal years preceding the year of the
transfer, the Transferee had gross assets for financial
reporting purposes (excluding any obligation of a person
related to the Investor within the meaning of Section 860L(g)
of the Code) in excess of $100 million and net assets in
excess of $10 million;
(iii) the Transferee will transfer the Class R Certificate only to
another "eligible corporation," as defined in Section
860(a)(2) of the Code, in a transaction that satisfies the
requirements of Section 4 of the Revenue Procedure; and
(iv) the Transferee determined the consideration paid to it to
acquire the Class R Certificate based on reasonable market
assumptions (including, but not limited to, borrowing and
investment rates, prepayment and loss assumptions, expense and
reinvestment assumptions, tax rates and other factors specific
to the Transferee) that it has determined in good faith.
|_| None of the above.
12. The Transferee is not an employee benefit plan that is subject
to ERISA or a plan that is subject to Section 4975 of the Code, and the
Transferee is not acting on behalf of or investing plan assets of such a plan.
* * *
IN WITNESS WHEREOF, the Transferee has caused this instrument to be
executed on its behalf, pursuant to authority of its Board of Directors, by its
duly authorized officer and its corporate seal to be hereunto affixed, duly
attested, this ____ day of ____________, 20__.
Print Name of Transferee
By:
----------------------------------
Name:
Title:
[Corporate Seal]
ATTEST:
---------------------------------------
[Assistant] Secretary
Personally appeared before me the above-named __________, known or
proved to me to be the same person who executed the foregoing instrument and to
be the ___________ of the Transferee, and acknowledged that he executed the same
as his free act and deed and the free act and deed of the Transferee.
Subscribed and sworn before me this day of , 20__.
---------------------------------------
NOTARY PUBLIC
My Commission expires the __ day
of _________, 20__
EXHIBIT H
FORM OF TRANSFEROR CERTIFICATE
__________, 20__
Xxxxxx Xxxxxxx Xxxx Xxxxxx Capital I Inc.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxx Xxxxx
U.S. Bank National Association,
U.S. Bank Trust Center,
as Trustee,
000 Xxxx Xxxxx Xxxxxx,
Xxxxxxxxx Xxxxx,
Xx. Xxxx, Xxxxxxxxx 00000
Re: Xxxxxx Xxxxxxx Xxxx Xxxxxx Capital I Inc. Trust, Series
2002-HE1, Mortgage Pass-Through Certificates, Series 2002-HE1,
Class ___
Ladies and Gentlemen:
In connection with our disposition of the above Certificates we
certify that (a) we understand that the Certificates have not been registered
under the Securities Act of 1933, as amended (the "Act"), and are being disposed
by us in a transaction that is exempt from the registration requirements of the
Act, (b) we have not offered or sold any Certificates to, or solicited offers to
buy any Certificates from, any person, or otherwise approached or negotiated
with any person with respect thereto, in a manner that would be deemed, or taken
any other action which would result in, a violation of Section 5 of the Act and
(c) to the extent we are disposing of a Residual Certificate, (i) we have no
knowledge the Transferee is not a Permitted Transferee and (ii) we have
conducted a reasonable investigation of this financial condition of this
Transferee and have no reason to believe that the Transferee will not pay all
taxes with respect to the Residual Certificate as they become due.
Very truly yours,
Print Name of Transferor
By:____________________________________
Authorized Officer
EXHIBIT I
FORM OF RULE 144A LETTER
____________, 20__
Xxxxxx Xxxxxxx Xxxx Xxxxxx Capital I Inc.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxx Xxxxx
U.S. Bank National Association,
U.S. Bank Trust Center,
as Trustee,
000 Xxxx Xxxxx Xxxxxx,
Xxxxxxxxx Xxxxx,
Xx. Xxxx, Xxxxxxxxx 00000
Re: Xxxxxx Xxxxxxx Xxxx Xxxxxx Capital I Inc. Trust, Series
2002-HE1, Mortgage Pass-Through Certificates, Series 2002-HE1,
Class ___
Ladies and Gentlemen:
In connection with our acquisition of the above 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 Certificates and all matters relating
thereto or any additional information deemed necessary to our decision to
purchase the Certificates, (d) either we are purchasing a Class A-1 Certificate
or we are not an employee benefit plan that is subject to the Employee
Retirement Income Security Act of 1974, as amended, or a plan or arrangement
that is subject to Section 4975 of the Internal Revenue Code of 1986, as
amended, nor are we acting on behalf of any such plan or arrangement nor using
the assets of any such plan or arrangement to effect such acquisition or, with
respect to a Class X Certificate, the purchaser is an insurance company that is
purchasing this certificate with funds contained in an "insurance company
general account" (as such term is defined in Section V(e) of Prohibited
Transaction Class Exemption 95-60 ("PTCE 95-60") and that the purchase and
holding of such Certificates are covered under Sections I and III of 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) to the extent that the Certificate transferred is a Class X Certificate, we
are a bankruptcy-remote entity and (g) we are a "qualified institutional buyer"
as that term is defined in Rule 144A under the Securities Act and have completed
either of the forms of certification to that effect attached hereto as Annex 1
or Annex 2. We are aware that the sale to us is being made in reliance on Rule
144A. We are acquiring the Certificates for our own account or for resale
pursuant to Rule 144A and further, understand that such Certificates may be
resold, pledged or transferred only (i) to a person reasonably believed to be a
qualified institutional buyer that purchases for its own account or for the
account of a qualified institutional buyer to whom notice is given that the
resale, pledge or transfer is being made in reliance on Rule 144A, or (ii)
pursuant to another exemption from registration under the Securities Act.
ANNEX 1 TO EXHIBIT I
--------------------
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
--------------------------------------------------------
[For Transferees Other Than Registered Investment Companies]
The undersigned (the "Buyer") hereby certifies as follows to the
parties listed in the Rule 144A Transferee Certificate to which this
certification relates with respect to the Certificates described therein:
1. As indicated below, the undersigned is the President, Chief
Financial Officer, Senior Vice President or other executive officer of the
Buyer.
2. In connection with purchases by the Buyer, the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under the
Securities Act of 1933, as amended ("Rule 144A"), because (i) the Buyer owned
and/or invested on a discretionary basis $ 1 in securities (except for the
excluded securities referred to below) as of the end of the Buyer's most recent
fiscal year (such amount being calculated in accordance with Rule 144A and (ii)
the Buyer satisfies the criteria in the category marked below.
-----------------------------
1 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.
____ Corporation, etc. The Buyer is a corporation (other than a
bank, savings and loan association or similar institution),
Massachusetts or similar business trust, partnership, or
charitable organization described in Section 501(c)(3) of the
Internal Revenue Code of 1986, as amended.
____ Bank. The Buyer (a) is a national bank or banking institution
organized under the laws of any State, territory or the
District of Columbia, the business of which is substantially
confined to banking and is supervised by the State or
territorial banking commission or similar official or is a
foreign bank or equivalent institution, and (b) has an audited
net worth of at least $25,000,000 as demonstrated in its
latest annual financial statements, a copy of which is
attached hereto.
____ Savings and Loan. The Buyer (a) is a savings and loan
association, building and loan association, cooperative bank,
homestead association or similar institution, which is
supervised and examined by a State or Federal authority having
supervision over any such institutions or is a foreign savings
and loan association or equivalent institution and (b) has an
audited net worth of at least $25,000,000 as demonstrated in
its latest annual financial statements, a copy of which is
attached hereto.
____ Broker-dealer. The Buyer is a dealer registered pursuant to
Section 15 of the Securities Exchange Act of 1934.
____ Insurance Company. The Buyer is an insurance company whose
primary and predominant business activity is the writing of
insurance or the reinsuring of risks underwritten by insurance
companies and which is subject to supervision by the insurance
commissioner or a similar official or agency of a State,
territory or the District of Columbia.
____ State or Local Plan. The Buyer is a plan established and
maintained by a State, its political subdivisions, or any
agency or instrumentality of the State or its political
subdivisions, for the benefit of its employees.
____ ERISA Plan. The Buyer is an employee benefit plan within the
meaning of Title I of the Employee Retirement Income Security
Act of 1974.
____ Investment Advisor. The Buyer is an investment advisor
registered under the Investment Advisors Act of 1940.
____ Small Business Investment Company. Buyer is a small business
investment company licensed by the U.S. Small Business
Administration under Section 301(c) or (d) of the Small
Business Investment Act of 1958.
____ Business Development Company. Buyer is a business development
company as defined in Section 202(a)(22) of the Investment
Advisors Act of 1940.
3. The term "securities" as used herein does not include (i)
securities of issuers that are affiliated with the Buyer, (ii) securities that
are part of an unsold allotment to or subscription by the Buyer, if the Buyer is
a dealer, (iii) securities issued or guaranteed by the U.S. or any
instrumentality thereof, (iv) bank deposit notes and certificates of deposit,
(v) loan participations, (vi) repurchase agreements, (vii) securities owned but
subject to a repurchase agreement and (viii) currency, interest rate and
commodity swaps.
4. For purposes of determining the aggregate amount of securities
owned and/or invested on a discretionary basis by the Buyer, the Buyer used the
cost of such securities to the Buyer and did not include any of the securities
referred to in the preceding paragraph, except (i) where the Buyer reports its
securities holdings in its financial statements on the basis of their market
value, and (ii) no current information with respect to the cost of those
securities has been published. If clause (ii) in the preceding sentence applies,
the securities may be valued at market. Further, in determining such aggregate
amount, the Buyer may have included securities owned by subsidiaries of the
Buyer, but only if such subsidiaries are consolidated with the Buyer in its
financial statements prepared in accordance with generally accepted accounting
principles and if the investments of such subsidiaries are managed under the
Buyer's direction. However, such securities were not included if the Buyer is a
majority-owned, consolidated subsidiary of another enterprise and the Buyer is
not itself a reporting company under the Securities Exchange Act of 1934, as
amended.
5. The Buyer acknowledges that it is familiar with Rule 144A and
understands that the seller to it and other parties related to the Certificates
are relying and will continue to rely on the statements made herein because one
or more sales to the Buyer may be in reliance on Rule 144A.
6. Until the date of purchase of the Rule 144A Securities, the Buyer
will notify each of the parties to which this certification is made of any
changes in the information and conclusions herein. Until such notice is given,
the Buyer's purchase of the Certificates will constitute a reaffirmation of this
certification as of the date of such purchase. In addition, if the Buyer is a
bank or savings and loan is provided above, the Buyer agrees that it will
furnish to such parties updated annual financial statements promptly after they
become available.
_______________________________________
Print Name of Transferor
By: ___________________________________
Name:
Title:
Date:__________________________________
ANNEX 2 TO EXHIBIT I
--------------------
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
--------------------------------------------------------
[For Transferees That are Registered Investment Companies]
The undersigned (the "Buyer") hereby certifies as follows to the
parties listed in the Rule 144A Transferee Certificate to which this
certification relates with respect to the Certificates described therein:
1. As indicated below, the undersigned is the President, Chief
Financial Officer or Senior Vice President of the Buyer or, if the Buyer is a
"qualified institutional buyer" as that term is defined in Rule 144A under the
Securities Act of 1933, as amended ("Rule 144A") because Buyer is part of a
Family of Investment Companies (as defined below), is such an officer of the
Adviser.
2. In connection with purchases by Buyer, the Buyer is a
"qualified institutional buyer" as defined in SEC Rule 144A because (i) the
Buyer is an investment company registered under the Investment Company Act of
1940, as amended and (ii) as marked below, the Buyer alone, or the Buyer's
Family of Investment Companies, owned at least $100,000,000 in securities (other
than the excluded securities referred to below) as of the end of the Buyer's
most recent fiscal year. For purposes of determining the amount of securities
owned by the Buyer or the Buyer's Family of Investment Companies, the cost of
such securities was used, except (i) where the Buyer or the Buyer's Family of
Investment Companies reports its securities holdings in its financial statements
on the basis of their market value, and (ii) no current information with respect
to the cost of those securities has been published. If clause (ii) in the
preceding sentence applies, the securities may be valued at market.
____ The Buyer owned $ in securities (other than the excluded
securities referred to below) as of the end of the Buyer's
most recent fiscal year (such amount being calculated in
accordance with Rule 144A).
____ The Buyer is part of a Family of Investment Companies which
owned in the aggregate $ in securities (other than the
excluded securities referred to below) as of the end of the
Buyer's most recent fiscal year (such amount being calculated
in accordance with Rule 144A).
3. The term "Family of Investment Companies" as used herein means
two or more registered investment companies (or series thereof) that have the
same investment adviser or investment advisers that are affiliated (by virtue of
being majority owned subsidiaries of the same parent or because one investment
adviser is a majority owned subsidiary of the other).
4. The term "securities" as used herein does not include (i)
securities of issuers that are affiliated with the Buyer or are part of the
Buyer's Family of Investment Companies, (ii) securities issued or guaranteed by
the U.S. or any instrumentality thereof, (iii) bank deposit notes and
certificates of deposit, (iv) loan participations, (v) repurchase agreements,
(vi) securities owned but subject to a repurchase agreement and (vii) currency,
interest rate and commodity swaps.
5. The Buyer is familiar with Rule 144A and understands that the
parties listed in the Rule 144A Transferee Certificate to which this
certification relates are relying and will continue to rely on the statements
made herein because one or more sales to the Buyer will be in reliance on Rule
144A. In addition, the Buyer will only purchase for the Buyer's own account.
6. Until the date of purchase of the Certificates, the
undersigned will notify the parties listed in the Rule 144A Transferee
Certificate to which this certification relates of any changes in the
information and conclusions herein. Until such notice is given, the Buyer's
purchase of the Certificates will constitute a reaffirmation of this
certification by the undersigned as of the date of such purchase.
_______________________________________
Print Name of Transferor
By: ___________________________________
Name:
Title:
IF AN ADVISER:
_______________________________________
Print Name of Buyer
Date:__________________________________
EXHIBIT J
REQUEST FOR RELEASE
(for Trustee)
To: [Address]
Re:
In connection with the administration of the Mortgage Loans held by
you as the Trustee on behalf of the Certificateholders, we request the release,
and acknowledge receipt, of the (Custodial File/[specify documents]) for the
Mortgage Loan described below, for the reason indicated.
Mortgagor's Name, Address & Zip Code:
------------------------------------
Mortgage Loan Number:
--------------------
Send Custodial File to:
----------------------
Reason for Requesting Documents (check one)
-------------------------------
____ 1. Mortgage Loan Paid in Full. (The Company hereby certifies that all
amounts received in connection therewith have been credited to its
Collection Account as provided in the Pooling and Servicing
Agreement.)
____ 2. Mortgage Loan Repurchase Pursuant to Subsection 2.03 of the Pooling
and Servicing Agreement. (The Company hereby certifies that the
repurchase price has been credited to Collection Account as provided
in the Pooling and Servicing Agreement.)
____ 3. Mortgage Loan Liquidated By _________________. (The Company hereby
certifies that all proceeds of foreclosure, insurance, condemnation
or other liquidation have been finally received and credited to its
Collection Account pursuant to the Pooling and Servicing Agreement.)
____ 4. Mortgage Loan in Foreclosure.
____ 5. Other (explain).__________________________________________________
If box 1, 2 or 3 above is checked, and if all or part of the
Custodial File was previously released to us, please release to us our previous
request and receipt on file with you, as well as any additional documents in
your possession relating to the specified Mortgage Loan.
If box 4 or 5 above is checked, upon our return of all of the above
documents to you as the Trustee, please acknowledge your receipt by signing in
the space indicated below, and returning this form.
[SERVICER]
By: ____________________________________
Name:
Title:
Date:
EXHIBIT K
CONTENTS OF EACH MORTGAGE FILE
With respect to each Mortgage Loan, the Mortgage File shall include
each of the following items, which shall be available for inspection by the
Purchaser and which shall be retained by the applicable Servicer or delivered to
and retained by the Trustee, as applicable:
(i) The original Mortgage Note bearing all intervening endorsements,
endorsed "Pay to the order of _____________, without recourse" and signed
in the name of the last endorsee by an authorized officer. To the extent
that there is no room on the face of a Mortgage Note for endorsements, the
endorsement may be contained on an allonge, if state law so allows and the
Trustee is so advised by the applicable Originator (pursuant to the
applicable Purchase Agreement) that state law so allows.
(ii) The original of any guaranty executed in connection with the
Mortgage Note.
(iii) The original Mortgage with evidence of recording thereon or a
certified true copy of such Mortgage submitted for recording. If, in
connection with any Mortgage Loan, the original Mortgage cannot be
delivered with evidence of recording thereon on or prior to the Closing
Date because of a delay caused by the public recording office where such
Mortgage has been delivered for recordation or because such Mortgage has
been lost or because such public recording office retains the original
recorded Mortgage, the Trustee shall notify the applicable Originator, as
required under the applicable Purchase Agreement, to deliver or cause to
be delivered to the Trustee, a photocopy of such Mortgage, together with
(i) in the case of a delay caused by the public recording office, an
Officer's Certificate of the applicable Originator or a certificate from
an escrow company, a title company or closing attorney stating that such
Mortgage has been dispatched to the appropriate public recording office
for recordation and that the original recorded Mortgage or a copy of such
Mortgage certified by such public recording office to be a true and
complete copy of the original recorded Mortgage will be promptly delivered
to the Trustee upon receipt thereof by the applicable Originator; or (ii)
in the case of a Mortgage where a public recording office retains the
original recorded Mortgage or in the case where a Mortgage is lost after
recordation in a public recording office, a copy of such Mortgage
certified by such public recording office to be a true and complete copy
of the original recorded Mortgage.
(iv) The originals of all assumption, modification, consolidation or
extension agreements, with evidence of recording thereon.
(v) The original Assignment of Mortgage for each Mortgage Loan
endorsed in blank.
(vi) The originals of all intervening assignments of mortgage (if
any) evidencing a complete chain of assignment from the applicable
originator to the last endorsee with evidence of recording thereon, or if
any such intervening assignment has not been returned from the applicable
recording office or has been lost or if such public recording office
retains the original recorded assignments of mortgage, the Trustee shall
notify the applicable Originator to deliver, as required under the
applicable Purchase Agreement, a photocopy of such intervening assignment,
together with (i) in the case of a delay caused by the public recording
office, an Officer's Certificate of the applicable Originator or a
certificate from an escrow company, a title company or a closing attorney
stating that such intervening assignment of mortgage has been dispatched
to the appropriate public recording office for recordation and that such
original recorded intervening assignment of mortgage or a copy of such
intervening assignment of mortgage certified by the appropriate public
recording office to be a true and complete copy of the original recorded
intervening assignment of mortgage will be promptly delivered to the
Trustee upon receipt thereof by the applicable Originator; or (ii) in the
case of an intervening assignment where a public recording office retains
the original recorded intervening assignment or in the case where an
intervening assignment is lost after recordation in a public recording
office, a copy of such intervening assignment certified by such public
recording office to be a true and complete copy of the original recorded
intervening assignment.
(vii) The original mortgagee title insurance policy or attorney's
opinion of title and abstract of title, or, in the event such original
title policy is unavailable, a certified true copy of the related policy
binder or commitment for title certified to be true and complete by the
title insurance company.
(viii) The original of any security agreement, chattel mortgage or
equivalent document executed in connection with the Mortgage (if
provided).
(ix) Residential loan application.
(x) Mortgage Loan closing statement.
(xi) Verification of employment and income, if applicable.
(xii) Verification of acceptable evidence of source and amount of
downpayment.
(xiii) Credit report on Mortgagor.
(xiv) Residential appraisal report.
(xv) Photograph of the Mortgaged Property.
(xvi) Survey of the Mortgaged Property.
(xvii) Copy of each instrument necessary to complete identification
of any exception set forth in the exception schedule in the title policy,
i.e., map or plat, restrictions, easements, sewer agreements, home
association declarations, etc.
(xviii) All required disclosure statements.
(xix) If required in an appraisal, termite report, structural
engineer's report, water potability and septic certification.
(xx) Sales Contract, if applicable.
Evidence of payment of taxes and insurance, insurance claim files,
correspondence, current and historical computerized data files (which include
records of tax receipts and payment history from the date of origination), and
all other processing, underwriting and closing papers and records which are
customarily contained in a mortgage loan file and which are required to document
the Mortgage Loan or to service the Mortgage Loan.
EXHIBIT L
FORM OF SUBSEQUENT TRANSFER AGREEMENT
XXXXXX XXXXXXX XXXX XXXXXX CAPITAL I INC. TRUST 2002-HE1
Pursuant to separate Purchase Agreements, [Accredited Home Lenders,
Inc. ("Accredited"), First Franklin Financial Corp. ("First Franklin"), NC
Capital Corporation ("New Century")] has agreed to sell to Xxxxxx Xxxxxxx Xxxx
Xxxxxx Mortgage Capital Inc. (the "Purchaser") certain mortgage loans (each, a
"Mortgage Loan"). These Mortgage Loans may in turn be sold by the Purchaser to
XXXXXX XXXXXXX XXXX XXXXXX CAPITAL I INC. (the "Depositor") and then sold by the
Depositor to the XXXXXX XXXXXXX XXXX XXXXXX CAPITAL I INC. Trust 0000-XX0 (xxx
"Xxxxx Xxxx"). The Trust Fund was established pursuant to a Pooling and
Servicing Agreement, dated as of June 1, 2002 (the "Pooling and Servicing
Agreement") among the Depositor, Ocwen Federal Bank FSB, as a Servicer
("Ocwen"), The Provident Bank, as a Servicer ("Provident" and, together with
Ocwen, the "Servicers") and U.S. Bank National Association, as trustee (the
"Trustee"). The Pooling and Servicing Agreement permits a pre-funding feature,
allowing for the acquisition by the Trust Fund of Subsequent Mortgage Loans
during the Pre-Funding Period. Representations and warranties with respect to
the Mortgage Loans have been made by the Originators pursuant to separate
Assignment and Recognition Agreements.
Capitalized terms used herein and not defined herein have their
respective meanings as set forth in the Pooling and Servicing Agreement.
Conveyance of Subsequent Mortgage Loans.
---------------------------------------
The Depositor does hereby irrevocably sell, transfer, assign,
set-over and otherwise convey to the Trust Fund, without recourse (except as
otherwise explicitly provided for herein) all of its right, title and interest
in and to the Subsequent Mortgage Loans, exclusive of the obligations of the
Depositor or any other Person with respect to the Subsequent Mortgage Loans but
including specifically, without limitation, the Mortgages, the Custodial Files
and all other documents, materials and properties appurtenant thereto and the
Mortgage Notes, including all interest and principal collected by the Depositor
on or with respect to the Subsequent Mortgage Loans after the related Subsequent
Cut-off Date, together with all of its right, title and interest in and to the
proceeds received after such Subsequent Cut-off Date of any related insurance
policies on behalf of the Trust Fund.
Additional terms of the sale are attached hereto as Attachment A.
To the extent permitted by applicable law, this Subsequent Transfer
Agreement, or a memorandum thereof if permitted under applicable law, is subject
to recordation in all appropriate public offices for real property records in
all counties or other comparable jurisdictions in which any or all of the
properties subject to the Mortgages are situated, and in any other appropriate
public recording office or elsewhere, such recordation to be effected by either
Servicer at the applicable Originator's expense, but only when accompanied by an
opinion of counsel to the effect that such recordation materially and
beneficially affects the interests of the Certificateholders or is necessary for
the administration or servicing of the Mortgage Loans.
This Agreement shall be construed in accordance with the laws of the
State of New York and the obligations, rights and remedies of the parties
hereunder shall be determined in accordance with such laws, without giving
effect to the principles of conflicts of laws.
This Agreement may be executed in one or more counterparts and by
the different parties hereto on separate counterparts, each of which, when so
executed, shall be deemed to be an original; such counterparts, together, shall
constitute one and the same Agreement.
All terms and conditions of the Pooling and Servicing Agreement are
hereby ratified, confirmed and incorporated herein; provided, that in the event
of any conflict the provisions of this Subsequent Transfer Agreement shall
control over the conflicting provisions of the Pooling and Servicing Agreement.
[Remainder of Page Intentionally Left Blank]
XXXXXX XXXXXXX XXXX XXXXXX CAPITAL I INC.,
as Depositor
By:____________________________________
Name:
Title:
OCWEN FEDERAL BANK FSB,
as a Servicer
By:____________________________________
Name:
Title:
THE PROVIDENT BANK,
as a Servicer
By:____________________________________
Name:
Title:
By:____________________________________
Name:
Title:
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:____________________________________
Name:
Title:
By:____________________________________
Name:
Title:
