EXHIBIT 99.1
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6
EXECUTION COPY
XXXXXX XXXXXXX CAPITAL I INC.
Depositor
XXXXX FARGO BANK, NATIONAL ASSOCIATION
Master Servicer and Securities Administrator
and
DEUTSCHE BANK NATIONAL TRUST COMPANY
Trustee
---------------------------
POOLING AND SERVICING AGREEMENT
Dated as of December 1, 2004
---------------------------
XXXXXX XXXXXXX MORTGAGE LOAN TRUST 2004-11AR
MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2004-11AR
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS.............................................................................................3
Section 1.01 Definitions.....................................................................................3
ARTICLE II DECLARATION OF TRUST; ISSUANCE OF CERTIFICATES........................................................46
Section 2.01 Creation and Declaration of Trust Fund; Conveyance of Mortgage Loans...........................46
Section 2.02 Acceptance of Trust Fund by Trustee; Review of Documentation for Trust Fund....................49
Section 2.03 Representations and Warranties of the Depositor................................................50
Section 2.04 Representations and Warranties of the Depositor and the Seller as to the Mortgage Loans........52
Section 2.05 Representations and Warranties of the Seller; Discovery of Breach; Repurchase or
Substitution of Mortgage Loans.................................................................52
Section 2.06 Grant Clause...................................................................................56
ARTICLE III THE CERTIFICATES.....................................................................................57
Section 3.01 The Certificates...............................................................................57
Section 3.02 Registration...................................................................................58
Section 3.03 Transfer and Exchange of Certificates..........................................................58
Section 3.04 Cancellation of Certificates...................................................................62
Section 3.05 Replacement of Certificates....................................................................62
Section 3.06 Persons Deemed Owners..........................................................................62
Section 3.07 Temporary Certificates.........................................................................63
Section 3.08 Appointment of Paying Agent....................................................................63
Section 3.09 Book-Entry Certificates........................................................................63
ARTICLE IV ADMINISTRATION OF THE TRUST FUND......................................................................65
Section 4.01 Custodial Accounts; Distribution Account.......................................................65
Section 4.02 Permitted Withdrawals from the Custodial Accounts and the Distribution Account.................66
Section 4.03 [Reserved].....................................................................................67
Section 4.04 [Reserved].....................................................................................67
Section 4.05 Reports to Trustee and Certificateholders......................................................68
ARTICLE V DISTRIBUTIONS TO HOLDERS OF CERTIFICATES...............................................................70
Section 5.01 Distributions Generally........................................................................70
Section 5.02 Priorities of Distribution.....................................................................70
Section 5.03 [Reserved].....................................................................................78
Section 5.04 Allocation of Losses...........................................................................78
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Section 5.05 Advances by the Master Servicer................................................................81
Section 5.06 Compensating Interest Payments.................................................................81
Section 5.07 [Reserved].....................................................................................82
Section 5.08 Cross-Collateralization; Adjustments to Available Funds........................................82
Section 5.09 Determination of Pass-Through Rates for LIBOR Certificates.....................................83
Section 5.10 Reserve Fund...................................................................................84
Section 5.11 The Corridor Contracts.........................................................................86
ARTICLE VI CONCERNING THE TRUSTEE AND THE SECURITIES ADMINISTRATOR; EVENTS OF DEFAULT............................88
Section 6.01 Duties of Trustee and the Securities Administrator.............................................88
Section 6.02 Certain Matters Affecting the Trustee and the Securities Administrator.........................91
Section 6.03 Trustee and Securities Administrator Not Liable for Certificates...............................92
Section 6.04 Trustee and the Securities Administrator May Own Certificates..................................93
Section 6.05 Eligibility Requirements for Trustee...........................................................93
Section 6.06 Resignation and Removal of Trustee and the Securities Administrator............................93
Section 6.07 Successor Trustee and Successor Securities Administrator.......................................96
Section 6.08 Merger or Consolidation of Trustee or the Securities Administrator.............................97
Section 6.09 Appointment of Co-Trustee, Separate Trustee or Custodian.......................................97
Section 6.10 Authenticating Agents..........................................................................99
Section 6.11 Indemnification of the Trustee and the Securities Administrator................................99
Section 6.12 Fees and Expenses of Securities Administrator and the Trustee.................................100
Section 6.13 Collection of Monies..........................................................................101
Section 6.14 Events of Default; Trustee To Act; Appointment of Successor...................................101
Section 6.15 Additional Remedies of Trustee Upon Event of Default..........................................105
Section 6.16 Waiver of Defaults............................................................................105
Section 6.17 Notification to Holders.......................................................................105
Section 6.18 Directions by Certificateholders and Duties of Trustee During Event of Default................105
Section 6.19 Action Upon Certain Failures of the Master Servicer and Upon Event of Default.................106
Section 6.20 Preparation of Tax Returns and Other Reports..................................................106
ARTICLE VII PURCHASE OF MORTGAGE LOANS AND TERMINATION OF THE TRUST FUND........................................108
Section 7.01 Purchase of Mortgage Loans; Termination of Trust Fund Upon Purchase or Liquidation
of All Mortgage Loans.........................................................................108
Section 7.02 Procedure Upon Redemption Termination of Trust Fund...........................................109
Section 7.03 Additional Trust Fund Termination Requirements................................................110
ARTICLE VIII RIGHTS OF CERTIFICATEHOLDERS.......................................................................111
Section 8.01 Limitation on Rights of Holders...............................................................111
Section 8.02 Access to List of Holders.....................................................................112
Section 8.03 Acts of Holders of Certificates...............................................................112
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ARTICLE IX ADMINISTRATION AND SERVICING OF MORTGAGE LOANS BY THE MASTER SERVICER................................113
Section 9.01 Duties of the Master Servicer; Enforcement of Servicers' and Master Servicer's Obligations....113
Section 9.02 Assumption of Master Servicing by Trustee.....................................................115
Section 9.03 Representations and Warranties of the Master Servicer.........................................116
Section 9.04 Compensation to the Master Servicer...........................................................118
Section 9.05 Merger or Consolidation.......................................................................119
Section 9.06 Resignation of Master Servicer................................................................119
Section 9.07 Assignment or Delegation of Duties by the Master Servicer.....................................119
Section 9.08 Limitation on Liability of the Master Servicer and Others.....................................120
Section 9.09 Indemnification; Third-Party Claims...........................................................121
Section 9.10 Eligibility Requirements for Securities Administrator.........................................121
ARTICLE X REMIC ADMINISTRATION..................................................................................121
Section 10.01 REMIC Administration..........................................................................121
Section 10.02 Prohibited Transactions and Activities........................................................124
Section 10.03 Indemnification with Respect to Prohibited Transactions or Loss of REMIC Status...............125
Section 10.04 REO Property..................................................................................125
Section 10.05 Fidelity......................................................................................126
ARTICLE XI MISCELLANEOUS PROVISIONS.............................................................................126
Section 11.01 Binding Nature of Agreement; Assignment.......................................................126
Section 11.02 Entire Agreement..............................................................................126
Section 11.03 Amendment.....................................................................................126
Section 11.04 Voting Rights.................................................................................127
Section 11.05 Provision of Information......................................................................128
Section 11.06 Governing Law.................................................................................128
Section 11.07 Notices. 128
Section 11.08 Severability of Provisions....................................................................129
Section 11.09 Indulgences; No Waivers.......................................................................129
Section 11.10 Headings Not To Affect Interpretation.........................................................129
Section 11.11 Benefits of Agreement.........................................................................129
Section 11.12 Special Notices to the Rating Agencies........................................................129
Section 11.13 Conflicts.....................................................................................130
Section 11.14 Counterparts..................................................................................130
Section 11.15 No Petitions..................................................................................130
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ATTACHMENTS
Exhibit A Forms of Certificates
Exhibit B Form of Residual Certificate Transfer Affidavit (Transferee)
Exhibit C Form of Residual Certificate Transfer Affidavit (Transferor)
Exhibit D [Reserved]
Exhibit E List of Purchase and Servicing Agreements
Exhibit F List of Custodial Agreements
Exhibit G Assignment and Notice of Transfer with respect to each Additional Collateral Mortgage Loan
Exhibit H Form of Rule 144A Transfer Certificate
Exhibit I Form of Purchaser's Letter for Institutional Accredited Investors
Exhibit J Form of ERISA Transfer Affidavit
Exhibit K Form of Letter of Representations with the Depository Trust Company
Exhibit L Form of Custodian Certification
Exhibit M [Reserved]
Schedule A Mortgage Loan Schedule
Schedule B Principal Balances Schedule
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This POOLING AND SERVICING AGREEMENT, dated as of December 1, 2004 (the
"Agreement"), by and among XXXXXX XXXXXXX CAPITAL I INC., a Delaware
corporation, as depositor (the "Depositor"), DEUTSCHE BANK NATIONAL TRUST
COMPANY, a national banking association, as trustee (the "Trustee"), XXXXX FARGO
BANK, NATIONAL ASSOCIATION, in its dual capacities as master servicer (the
"Master Servicer") and securities administrator (the "Securities Administrator")
and acknowledged by XXXXXX XXXXXXX MORTGAGE CAPITAL INC., a New York
corporation, as seller (the "Seller"), for purposes of Section 2.05.
WITNESSETH THAT
In consideration of the mutual agreements herein contained, the parties
hereto agree as follows:
PRELIMINARY STATEMENT
The Depositor is the owner of the Trust Fund that is hereby
conveyed to the Trustee in return for the Certificates. As provided herein, the
Trustee will make multiple elections to treat segregated pools of assets subject
to this Agreement for federal income tax purposes (other than the Corridor
Contracts and the assets held in the Reserve Fund) as the following three
separate real estate mortgage investment conduits (each, a "REMIC"): Subsidiary
REMIC 1, Subsidiary REMIC 2 and the Master REMIC. Subsidiary REMIC 1 will
consist of Loan Group 1, excluding any rights of the Trust Fund in respect of
the Additional Collateral, the Corridor Contract Agreements, and the Reserve
Fund. Subsidiary REMIC 2 will consist of Loan Group 2, Loan Group 3, Loan Group
4 and Loan Group 5, excluding any rights of the Trust Fund in respect of the
Additional Collateral. Each Subsidiary REMIC will issue uncertificated REMIC
regular interests (the "Subsidiary REMIC Regular Interests"). The Subsidiary
REMIC Regular Interests will represent the "regular interests" in each
Subsidiary REMIC. The Class R-1A Interest will represent the single Class of
"residual interest" in Subsidiary REMIC 1 and the Class R-1B Interest will
represent the single Class of "residual interest" in Subsidiary REMIC 2.
The Trustee will hold the Subsidiary REMIC Regular Interests
for the benefit of the Master REMIC. The Master REMIC will consist of the
Subsidiary REMIC Interests and will be evidenced by the Certificates, which
(other than the Class A-R Certificates) will constitute the regular interests in
the Master REMIC (the "Regular Certificates") and the Class R-2 Interest, which
will represent the single Class of "residual interest" in the Master REMIC. The
Class A-R Certificates will represent the beneficial ownership of each of the
Class R-1A, Class R-1B and Class R-2 Interests. The "latest possible maturity
date" for federal income tax purposes of all regular and residual interests
created hereunder will be the Latest Possible Maturity Date.
Subsidiary REMIC 1
The Subsidiary REMIC 1 Interests, each of which (except for
the Class R-1A Interests) is hereby designated as a REMIC regular interest for
federal income tax purposes, will
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have the principal balances, pass-through rates and Corresponding Loan Groups as
set forth in the following table:
Subsidiary REMIC Pass-Through Corresponding
Interests Initial Balance Rate Certificate (2)
------------------------------- ------------------- ------------------------ -----------------------------
1-A-1 29,008,703 (1) 0-X-0, 0-X-0X, 0-X-0X
0-X-0 27,595,706 (1) 0-X-0, 0-X-0X, 0-X-0X
0-X-0 26,256,225 (1) 0-X-0, 0-X-0X, 0-X-0X
0-X-0 24,975,257 (1) 0-X-0, 0-X-0X, 0-X-0X
0-X-0 23,758,048 (1) 0-X-0, 0-X-0X, 0-X-0X
0-X-0 22,600,722 (1) 0-X-0, 0-X-0X, 0-X-0X
0-X-0 21,499,765 (1) 0-X-0, 0-X-0X, 0-X-0X
0-X-0 20,452,255 (1) 0-X-0, 0-X-0X, 0-X-0X
0-X-0 19,455,962 (1) 1-A-1, 1-A-2A, 1-A-2B
1-A-10 18,508,702 (1) 1-A-1, 1-A-2A, 1-A-2B
1-A-11 17,607,007 (1) 1-A-1, 1-A-2A, 1-A-2B
1-A-12 16,749,213 (1) 1-A-1, 1-A-2A, 1-A-2B
1-A-13 15,933,188 (1) 1-A-1, 1-A-2A, 1-A-2B
1-A-14 15,156,894 (1) 1-A-1, 1-A-2A, 1-A-2B
1-A-15 25,779,048 (1) 1-A-1, 1-A-2A, 1-A-2B
1-A-16 11,913,098 (1) 1-A-1, 1-A-2A, 1-A-2B
1-A-17 11,305,160 (1) 1-A-1, 1-A-2A, 1-A-2B
1-A-18 10,727,501 (1) 1-A-1, 1-A-2A, 1-A-2B
1-A-19 10,178,632 (1) 1-A-1, 1-A-2A, 1-A-2B
1-A-20 9,657,129 (1) 0-X-0, 0-X-0X, 0-X-0X
0-X-00 9,161,639 (1) 0-X-0, 0-X-0X, 0-X-0X
0-X-00 8,690,934 (1) 0-X-0, 0-X-0X, 0-X-0X
0-X-00 8,243,826 (1) 0-X-0, 0-X-0X, 0-X-0X
0-X-00 7,818,963 (1) 0-X-0, 0-X-0X, 0-X-0X
0-X-00 7,415,359 (1) 0-X-0, 0-X-0X, 0-X-0X
0-X-00 7,031,965 (1) 0-X-0, 0-X-0X, 0-X-0X
0-X-00 6,667,785 (1) 0-X-0, 0-X-0X, 0-X-0X
0-X-00 6,321,869 (1) 1-A-1, 1-A-2A, 1-A-2B
1-A-29 106,121,445 (1) 1-A-1, 1-A-2A, 1-A-2B
1-B-1 (2) (1) 1-B-1
1-B-2 (2) (1) 1-B-2
1-B-3 (2) (1) 1-B-3
1-B-4 (2) (1) 1-B-4
1-B-5 (2) (1) 1-B-5
1-B-6 (2) (1) 1-B-6
Class SR-P1 $50 (3) N/A
R-1A $0 N/A (4) N/A
---------------
(1) The Group 1 Net WAC.
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(2) The Class 1-B-1, Class 1-B-2, Class 1-B-3, Class 1-B-4, Class 1-B-5
and Class 1-B-6 Interests will have the same principal balance on the
Closing Date as their Corresponding Certificates. On each Distribution
Date, any distributions of scheduled principal and prepayments and
Realized Losses will be allocated to the Subsidiary REMIC 1 Interests
in the same manner as they are allocated (in the aggregate) to their
Corresponding Certificates. Distributions of scheduled principal and
prepayments and Realized Losses in respect of the Class 1-A-1, Class
1-A-2A and Class 1-A-2B Certificates will be allocated to the
Subsidiary REMIC 1 Interests designated "1-A-" sequentially to in order
of the cardinal number following such designation, in each case, until
the principal balance of such class is reduced to zero.
(3) The Class SR-P1 Interest will not be entitled to any interest, but
will be entitled to 100% of any prepayment premiums paid on the Group
1 Mortgage Loans.
(4) The Class R-1A Interest is the sole class of residual interest in
Subsidiary REMIC 1 and will not be entitled to distributions of
principal or interest.
Subsidiary REMIC 2
The Subsidiary REMIC 2 Interests, each of which (except for
the Class R-1B Interests) is hereby designated as a REMIC regular interest for
federal income tax purposes, will have the principal balances, pass-through
rates and Corresponding Loan Groups as set forth in the following table:
A-2 (0.9% of Subordinated Portion
Group 2).... (1) (2) 2
B-2 (0.1% of Subordinated Portion
Group 2) (1) (2) 2
C-2 (Excess of Group 2)... (1) (2) 2
A-3 (0.9% of Subordinated Portion
Group 3).... (1) (2) 3
B-3 (0.1% of Subordinated Portion
Group 3) (1) (2) 3
C-3 (Excess of Group 3)... (1) (2) 3
A-4 (0.9% of Subordinated Portion
Group 4).... (1) (2) 4
B-4 (0.1% of Subordinated Portion
Group 4) (1) (2) 4
C-4 (Excess of Group 4)... (1) (2) 4
A-5 (0.9% of Subordinated Portion
Group 5).... (1) (2) 5
B-5 (0.1% of Subordinated Portion
Group 5) (1) (2) 5
C-5 (Excess of Group 5)... (1) (2) 5
Class SR-$100 $100 (3) N/A
Class SR-P2 $50 (3) N/A
R-1B $0 N/A (4) N/A
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(1) Each Class A Interest will have a principal balance initially equal to
0.9% of the Subordinated Portion of its Corresponding Loan Group. Each
Class B Interest will have a principal balance initially equal to 0.1%
of the Subordinated Portion of its Corresponding Loan Group. The
initial principal balance of each Class C Interest will equal the
excess of the principal balance of its Corresponding Loan Group over
the initial aggregate principal balances of the Class A and Class B
Interests corresponding to such Loan Group.
(2) The Weighted Average Net Mortgage Rate in respect of the Corresponding
Loan Group.
(3) (3) The Class SR-P2 Interest will not be entitled to any interest, but
will be entitled to 100% of any prepayment premiums paid on the Group
2, Group 3, Group 4 and Group 5 Mortgage Loans.
(4) The Class R-1B Interest is the sole class of residual interest in
Subsidiary REMIC 2 and will not be entitled to distributions of
principal or interest.
On any Distribution Date:
(1) If no Cross-Over Situation exists with respect to any Class of
Interests, then Principal Reductions arising with respect to each Loan Group
will be allocated first to cause the Loan Group's corresponding Class A and
Class B Interests to equal, respectively, 0.9% and 0.1% of the Subordinated
Portion as of such Distribution Date, and second to the Loan Group's
corresponding Class C Interest;
(2) If a Cross-Over Situation exists then:
(a) if the Calculation Rate in respect of the outstanding Class A and
and Class B Interests is less than the Pass Through Rate in respect of the
Aggregate Group II Subordinate Certificates, Principal Relocation Payments will
be made proportionately to the outstanding Class A Interests prior to any other
Principal Distributions from each such Loan Group; and
(b) if the Calculation Rate in respect of the outstanding Class A and
Class B Interests is greater than the Pass Through Rate in respect of the
Aggregate Group II Subordinate Certificates, Principal Relocation Payments will
be made proportionately to the outstanding Class B Interests prior to any other
Principal Distributions from each such Loan Group.
In each case, Principal Relocation Payments will be made so as to cause
the Calculation Rate in respect of the outstanding Class A and Class B Interests
to equal the Pass Through Rate in respect of the Aggregate Group II Subordinate
Certificates. With respect to each Loan Group, if (and to the extent that) the
sum of (a) the principal payments comprising the Principal Remittance Amount
received during the Due Period and (b) the Realized Losses, are insufficient to
make the necessary reductions of principal on the Class A and Class B Interests,
then interest will be added to the Loan Group's other Interests that are not
receiving Principal Relocation Payments, in proportion to their principal
balances.
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(c) The outstanding aggregate Class A and Class B Interests will not be
reduced below 1 percent of the excess of (i) the aggregate outstanding Principal
Balances of the Mortgage Loans in Loan Group 2, 3, 4 and 5 as of the end of any
Due Period over (ii) the Certificate Balance of the related Senior Certificates
as of the related Distribution Date (after taking into account distributions of
principal on such Distribution Date).
If (and to the extent that) the limitation in paragraph (c) prevents
the distribution of principal to any of the Class A and Class B Interests, and
if the Loan Group's Class C Interest has already been reduced to zero, then the
excess principal from that Loan Group will be paid to the Class C Interests of
any other Loan Group whose aggregate corresponding Class A and Class B Interests
are less than one percent of their corresponding Subordinated Portion. If any
Loan Group corresponding to a Class C Interest that receives such payment has a
Weighted Average Net Mortgage Rate below the Weighted Average Net Mortgage Rate
of the Loan Group making such payment, then the payment will be treated by
Subsidiary REMIC 2 as a Realized Loss. Conversely, if the Loan Group of the
Class C Interest or Interests that receive such payment has a Weighted Average
Net Mortgage Rate above the Weighted Average Net Mortgage Rate of the Loan Group
making the payment, then the payment will be treated by Subsidiary REMIC 2 as a
reimbursement for prior Realized Losses.
The Master REMIC
The following table sets forth characteristics of the Master REMIC
Certificates, together with the minimum denominations and integral multiples in
excess thereof in which such Classes shall be issuable (except that one
Certificate of each Class of Certificates may be issued in a different amount
and, in addition, one Residual Certificate representing the Tax Matters Person
Certificate may be issued in a different amount):
======================== ============================ ====================== ====================== ======================
Pass-Through
Initial Class Principal Rate Integral Multiples
Class Designation Balance (per annum) Minimum Denomination in Excess of Minimum
---------------------------------------------------------------------------------------------------------------------------
Class 1-A-1 $324,369,000.00 (1) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------------
Class 1-A-2A $200,000,000.00 (2) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------------
Class 1-A-2B $22,223,000.00 (3) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------------
Class 1-X-1 (4) (5) $100,000.00(6) $1,000.00(6)
---------------------------------------------------------------------------------------------------------------------------
Class 1-X-2 (4) (7) $100,000.00(6) $1,000.00(6)
---------------------------------------------------------------------------------------------------------------------------
Class 1-X-B (4) (8) $100,000.00(6) $1,000.00(6)
---------------------------------------------------------------------------------------------------------------------------
Class 2-A $156,951,000.00 (9) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------------
Class 3-A $331,007,000.00 (10) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------------
Class 4-A $23,146,000.00 (11) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------------
Class 5-A $20,973,000.00 (12) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------------
Class A-R (19) $100.00 (9) (13) (13)
---------------------------------------------------------------------------------------------------------------------------
Class 1-B-1 $21,149,000.00 (14) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------------
Class 1-B-2 $9,532,000.00 (15) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------------
Class 1-B-3 $5,957,000.00 (16) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------------
Class 1-B-4 $5,362,000.00 (17) $100,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------------
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---------------------------------------------------------------------------------------------------------------------------
Class 1-B-5 $4,170,000.00 (17) $100,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------------
Class 1-B-6 $2,979,455.00 (17) $100,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------------
Class B-1 $17,117,000.00 (18) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------------
Class B-2 $7,133,000.00 (18) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------------
Class B-3 $4,564,000.00 (18) $25,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------------
Class B-4 $4,565,000.00 (18) $100,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------------
Class B-5 $3,138,000.00 (18) $100,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------------
Class B-6 $1,998,065.68 (18) $100,000.00 $1,000.00
---------------------------------------------------------------------------------------------------------------------------
Class P-1 $100.00 (19), (20) $100.00 N/A
---------------------------------------------------------------------------------------------------------------------------
Class P-2 $100.00 (19), (20) $100.00 N/A
============================================================================================================================
------------------------------------------
(1) The Pass-Through Rate for the Class 1-A-1 Certificates for the Interest
Accrual Period related to any Distribution Date will be a per annum rate
equal to one-month LIBOR + 0.32%, subject to a maximum Pass-Through Rate of
the lesser of (i) 10.50% per annum and (ii) the Group 1 Net WAC for such
Distribution Date. The Pass-Through Rate for the Class 1-A-1 Certificates
for the initial Interest Accrual Period will be 2.740% per annum.
(2) The Pass-Through Rate for the Class 1-A-2A Certificates for the Interest
Accrual Period related to any Distribution Date will be a per annum rate
equal to one-month LIBOR + 0.31%, subject to a maximum Pass-Through Rate of
the lesser of (i) 10.50% per annum and (ii) the Group 1 Net WAC for such
Distribution Date. The Pass-Through Rate for the Class 1-A-2A Certificates
for the initial Interest Accrual Period will be 2.730% per annum.
(3) The Pass-Through Rate for the Class 1-A-2B Certificates for the Interest
Accrual Period related to any Distribution Date will be a per annum rate
equal to one-month LIBOR + 0.37%, subject to a maximum Pass-Through Rate of
the lesser of (i) 10.50% per annum and (ii) the Group 1 Net WAC for such
Distribution Date. The Pass-Through Rate for the Class 1-A-2B Certificates
for the initial Interest Accrual Period will be 2.790% per annum.
(4) The Class 1-X-1, Class 1-X-2 and Class 1-X-B Certificates will be Notional
Amount Certificates, will have no Class Principal Balances and will bear
interest on their respective Notional Amounts (initially, $546,592,000,
$546,592,000 and $36,638,000, respectively).
(5) The Pass-Through Rate for the Class 1-X-1 for the Interest Accrual Period
related to any Distribution Date to and including the Distribution Date in
June 2007 will be a per annum rate equal to the lesser of (x) 1.10% and (y)
the excess, if any, of (i) the Group 1 Net WAC over (ii) the weighted
average of the Pass-Through Rates for the Class 1-A-1, Class 1-A-2A and
Class 1-A-2B Certificates for the Interest Accrual Period related to that
Distribution Date. The Pass-Through Rate for the Class 1-X-1 for the
Interest Accrual Period related to any Distribution Date after the
Distribution Date in June 2007 will be a per annum rate equal to zero. For
federal income tax purposes, the Pass-Through Rate for the Class 1-X-1 for
the Interest Accrual Period related to any Distribution Date will be a per
annum rate equal to the excess, if any, of (i) the Group 1 Net WAC over
(ii) the Group 1 Net WAC minus 1.1% subject to a floor equal to the
weighted average of the Pass-Through Rates for the Class 1-A-1, Class
1-A-2A and Class 1-A-2B Certificates and the notional balance of the Class
1-X-1 Certificates will equal the principal balance of each Subsidiary
REMIC 1 Interest whose cardinal number following such designation (e.g. -0,
-0, -0, ...) is not exceeded by the ordinal number of the Distribution Date
following the Closing Date (e.g. first, second, third,...). The
Pass-Through Rate for the Class 1-X-1 Certificates for the initial Interest
Accrual Period will be 1.100% per annum.
x
(6) Minimum denomination is based on the Notional Amount of such Class.
(7) The Pass-Through Rate for the Class 1-X-2 for the Interest Accrual Period
related to any Distribution Date will be a per annum rate equal to the
excess, if any, of (i) the Group 1 Net WAC over (ii) the sum of (x) the
weighted average of the Pass-Through Rates for the Class 1-A-1, Class
1-A-2A and Class 1-A-2B Certificates and (y) the product of (a) the
Pass-Through Rate for the Class 1-X-1 Certificates and (b) the Notional
Balance of the Class 1-X-1 Certificates, divided by the aggregate Class
Principal Balance of the Class 1-A-1, Class 1-A-2A and Class 1-A-2B
Certificates, in each case for the Interest Accrual Period related to that
Distribution Date. For federal income tax purposes, the Pass-Through Rate
for the Class 1-X-2 for the Interest Accrual Period related to any
Distribution Date will be a per annum rate equal to the excess if any, of
(i) the Group 1 Net WAC over (ii) the weighted average of the Pass-Through
Rates for the Subsidiary REMIC 1 Interests designated Class "1-A-" treating
each such Class as subject to a cap equal to the lesser of the Group 1 WAC
and: (x) the weighted average of the Pass-Through Rates for the Class
1-A-1, Class 1-A-2A and Class 1-A-2B Certificates plus 1.1% until the first
Distribution Date upon which the cardinal number following such designation
(e.g. -0, -0, -0, ...) is exceeded by the ordinal number of the
Distribution Date following the Closing Date (e.g. first, second,
third,...), and (y) the weighted average of the Pass-Through Rates for the
Class 1-A-1, Class 1-A-2A and Class 1-A-2B Certificates, thereafter. The
Pass-Through Rate for the Class 1-X-2 Certificates for the initial Interest
Accrual Period will be 1.194% per annum.
(8) The Pass-Through Rate for the Class 1-X-B for the Interest Accrual Period
related to any Distribution Date will be a per annum rate equal to the
excess, if any, of (i) the Group 1 Net WAC over (ii) the weighted average
of the Pass-Through Rates for the Class 1-B-1, Class 1-B-2 and Class 1-B-3
Certificates for the Interest Accrual Period related to that Distribution
Date. The Pass-Through Rate for the Class 1-X-B Certificates for the
initial Interest Accrual Period will be 1.777% per annum.
(9) The Pass-Through Rate for the Class 2-A and Class A-R Certificates for any
Distribution Date will be a per annum rate equal to the Weighted Average
Net Mortgage Rate on the Group 2 Mortgage Loans. The Pass-Through Rate for
the Class 2-A and Class A-R Certificates for the first Distribution Date
will be a per annum rate of 5.210%.
(10) The Pass-Through Rate for the Class 3-A Certificates for any Distribution
Date will be a per annum rate equal to the Weighted Average Net Mortgage
Rate on the Group 3 Mortgage Loans. The Pass-Through Rate for the Class 3-A
Certificates for the first Distribution Date will be a per annum rate of
5.519%.
(11) The Pass-Through Rate for the Class 4-A Certificates for any Distribution
Date will be a per annum rate equal to the Weighted Average Net Mortgage
Rate on the Group 4 Mortgage Loans. The Pass-Through Rate for the Class 4-A
Certificates for the first Distribution Date will be a per annum rate of
5.680%.
(12) The Pass-Through Rate for the Class 5-A Certificates for any Distribution
Date will be a per annum rate equal to the Weighted Average Net Mortgage
Rate on the Group 5 Mortgage Loans. The Pass-Through Rate for the Class 5-A
Certificates for the first Distribution Date will be a per annum rate of
5.650%.
(13) The Class A-R Certificate shall be issued as two separate certificates, one
with an initial Certificate Balance of $99.99 and the Tax Matters Person
Certificate with an initial Certificate Balance of $0.01.
xi
(14) The Pass-Through Rate for the Class 1-B-1 Certificates for the Interest
Accrual Period related to any Distribution Date will be a per annum rate
equal to one-month LIBOR + 0.60%, subject to a maximum Pass-Through Rate of
the lesser of (i) 10.50% per annum and (ii) the Group 1 Net WAC for such
Distribution Date. The Pass-Through Rate for the Class 1-B-1 Certificates
for the initial Interest Accrual Period will be 3.020% per annum.
(15) The Pass-Through Rate for the Class 1-B-2 Certificates for the Interest
Accrual Period related to any Distribution Date will be a per annum rate
equal to one-month LIBOR + 1.00%, subject to a maximum Pass-Through Rate of
the lesser of (i) 10.50% per annum and (ii) the Group 1 Net WAC for such
Distribution Date. The Pass-Through Rate for the Class 1-B-2 Certificates
for the initial Interest Accrual Period will be 3.420% per annum.
(16) The Pass-Through Rate for the Class 1-B-3 Certificates for the Interest
Accrual Period related to any Distribution Date will be a per annum rate
equal to one-month LIBOR + 1.90%, subject to a maximum Pass-Through Rate of
the lesser of (i) 10.50% per annum and (ii) the Group 1 Net WAC for such
Distribution Date. The Pass-Through Rate for the Class 1-B-3 Certificates
for the initial Interest Accrual Period will be 4.320% per annum.
(17) The Pass-Through Rate for the Class 1-B-4, Class 1-B-5 and Class 1-B-6
Certificates for any Distribution Date will be a per annum rate equal to
the Weighted Average Net Mortgage Rate on the Group 1 Mortgage Loans. The
Pass-Through Rate for the Class 1-B-4, Class 1-B-5 and Class 1-B-6
Certificates for the Interest Accrual Period related to the first
Distribution Date will be a per annum rate of 4.668%.
(18) The Pass-Through Rate for each Class of Aggregate Group II Subordinated
Certificates for any Distribution Date will be a per annum rate equal to
the sum of: (1) the Weighted Average Net Mortgage Rate on the Group 2
Mortgage Loans multiplied by the excess of the aggregate Stated Principal
Balance of the Group 2 Mortgage Loans as of the Due Date in the month
preceding the month of that Distribution Date (after giving effect to
prepayments received in the Prepayment Period related to such prior Due
Date) over the aggregate of the Class Principal Balances of the group 2
senior certificates immediately prior to that Distribution Date, (2) the
Weighted Average Net Mortgage Rate on the Group 3 Mortgage Loans multiplied
by the excess of the aggregate Stated Principal Balance of the Group 3
Mortgage Loans as of the Due Date in the month preceding the month of that
Distribution Date (after giving effect to prepayments received in the
Prepayment Period related to such prior Due Date) over the aggregate of the
Class Principal Balances of the group 3 senior certificates immediately
prior to that Distribution Date, (3) the Weighted Average Net Mortgage Rate
on the Group 4 Mortgage Loans multiplied by the excess of the aggregate
Stated Principal Balance of the Group 4 Mortgage Loans as of the Due Date
in the month preceding the month of that Distribution Date (after giving
effect to prepayments received in the Prepayment Period related to such
prior Due Date) over the aggregate of the Class Principal Balances of the
group 4 senior certificates immediately prior to that Distribution Date,
and (4) the Weighted Average Net Mortgage Rate on the Group 5 Mortgage
Loans multiplied by the excess of the aggregate Stated Principal Balance of
the Group 5 Mortgage Loans as of the Due Date in the month preceding the
month of that Distribution Date (after giving effect to prepayments
received in the Prepayment Period related to such prior Due Date) over the
aggregate of the Class Principal Balances of the group 5 senior
certificates immediately prior to that Distribution Date; divided by the
aggregate of the Class Principal Balances of the Aggregate Group II
Subordinated Certificates immediately prior to that Distribution Date. The
Pass-Through Rate for each class of Aggregate Group II Subordinated
Certificates for the Interest Accrual Period related to the first
Distribution Date will be a per annum rate of 5.415%.
xii
(19) The Class P-1 and Class P-2 Certificates will not be entitled to any
interest, but will be entitled to 100% of any prepayment premiums paid on
the Group 1 Mortgage Loans and the Aggregate Group II Mortgage Loans,
respectively. For the federal income tax purposes, the Class P-1 and Class
P-2 Certificates will be entitled to 100% of the Class MP Regular Interest
cash flow.
(20) The Class P-1 Certificates will receive all payments in respect of
prepayment penalties on all of the mortgage loans in Loan Group 1 and are
not entitled to receive any distributions of interest. The Class P-2
Certificates will receive all payments in respect of prepayment penalties
on all of the mortgage loans in Loan Group 2, Loan Group 3, Loan Group 4
and Loan Group 5 and are not entitled to receive any distributions of
interest.
The foregoing provisions in the Preliminary Statement are intended to
cause net interest and principal collections in respect of the Mortgage Loans to
be distributed from each Subsidiary REMIC to the Master REMIC and from the
Master REMIC to each Class of Certificates. The Preliminary Statement will be
interpreted and applied consistently with such intent.
For any purpose for which the Pass-Through Rates is calculated, the
interest rate on the Mortgage Loans shall be appropriately adjusted to account
for the difference between the monthly day count convention of the Mortgage
Loans and the monthly day count convention of the regular interests issued by
each of the REMICs. For purposes of calculating the Pass-Through Rates for each
of the interests issued by each REMIC created hereunder (other than the Master
REMIC) such rates shall be adjusted to equal a monthly day count convention
based on a 30 day month for each Due Period and a 360-day year so that the
Mortgage Loans and all regular interests will be using the same monthly day
count convention.
xiii
Set forth below are designations of Classes or Components of Certificates and
other defined terms to the categories used herein:
Accretion Directed Certificates........... None.
Accretion Directed Components............. None.
Accrual Certificates...................... None.
Accrual Components........................ None.
Aggregate Certificate Group............... Each of the Group 1 Certificates and Aggregate Group II Certificates.
Group 1 Certificates...................... Group 1 Senior Certificates and Group 1 Subordinated Certificates.
Group 1 Senior
Certificates.............................. Class 1-A-1, Class 1-A-2a, Class 1-A-2b, Class 1-X-1, Class 1-X-2 and
Class 1-X-B Certificates.
Group 1 Subordinated
Certificates.............................. Class 1-B-1, Class 1-B-2, Class 1-B-3, Class 1-B-4, Class 1-B-5 and
Class 1-B-6 Certificates.
Group 2 Senior Certificates............... Group 2 Senior Certificates and the portions of the Group 1 Subordinated
Certificates related to Loan Group 2.
Group 2 Senior Certificates............... Class 2-A and Class A-R Certificates.
Group 3 Senior Certificates............... Group 3 Senior Certificates and the portions of the Aggregate Group
II Subordinated Certificates related to Loan Group 3.
Group 3 Senior Certificates............... Class 3-A Certificates.
Group 4 Senior Certificates............... Group 4 Senior Certificates and the portions of the Aggregate Group II
Subordinated Certificates related to Loan Group 3.
Group 4 Senior Certificates............... Class 4-A Certificates.
Group 5 Senior Certificates............... Group 5 Senior Certificates and the portions of the Aggregate Group II
Subordinated Certificates related to Loan Group 5.
Group 5 Senior Certificates............... Class 5-A Certificates.
Aggregate Group II Certificates........... Aggregate Group II Senior Certificates and Aggregate Group II
Subordinated Certificates.
Aggregate Group II Senior
Certificates.............................. Group 2 Senior Certificates, Group 3 Senior Certificates, Group
4 Senior Certificates and Group 5 Senior Certificates.
1
Aggregate Group II Subordinated
Certificates.............................. Class B-1, Class B-2, Class B-3, Class B-4, Class B-5 and Class
B-6 Certificates.
Book-Entry Certificates................... All Classes of Certificates other than the Definitive Certificates.
Combined Certificates..................... None.
Component Certificates.................... None.
Components................................ For purposes of calculating distributions of principal and/or
interest, the Component Certificates, if any, will be
comprised of multiple payment components having the designations,
Initial Component Balances or Notional Amounts, as applicable, and
Pass-Through Rates set forth below:
Initial Component
Designation Principal Balance Pass-Through Rate
----------- ------------------ ------------------
N/A N/A N/A
Delay Certificates........................ All interest-bearing Classes of Certificates other than the Non-Delay
Certificates, if any.
ERISA-Restricted Certificates............. The Residual Certificates and Private Certificates; and any Certificate
of a Class that ceases to satisfy the applicable rating requirement under
the Underwriter's Exemption.
Floating Rate Certificates................ Class 1-A-1, Class 1-A-2a, Class 1-A-2b, Class 1-B-1, Class 1-B-2 and Class
1-B-3 Certificates.
Inverse Floating Rate Certificates........ None.
LIBOR Certificates........................ Floating Rate Certificates and Inverse Floating Rate Certificates.
Non-Delay Certificates.................... The LIBOR Certificates.
Notional Amount Certificates.............. Class 1-X-1, Class 1-X-2 and Class 1-X-B Certificates.
Notional Amount Components................ None.
Offered Certificates...................... All Classes of Certificates other than the Private Certificates.
Definitive Certificates................... Private Certificates and the Residual Certificates.
Planned Principal Classes................. None.
Principal Only Certificates............... None.
Private Certificates...................... Class P-1, Class P-2, Class 1-B-4, Class B-4, Class 1-B-5, Class B-5,
Class 1-B-6 and Class B-6 Certificates.
2
Rating Agencies........................... S&P, Xxxxx'x and Fitch.
Regular Certificates...................... All Classes of Certificates, other than the Residual Certificates.
Residual Certificates..................... Class A-R Certificates.
Scheduled Principal Classes............... None.
Senior Certificate Group.................. The Group 1 Senior Certificates, the Group 2 Senior Certificates, the
Group 3 Senior Certificates, the Group 4 Senior Certificates or the Group 5
Senior Certificates, as applicable.
Senior Certificates....................... Class1-A-1, Class 1-A-2A, Class 1-A-2B, Class 1-X-1, Class 1-X-2, Class 1-
X-B, Class 2-A, Class 3-A, Class 4-A, Class 5-A and Class A-R Certificates.
Subordinated Certificate Group............ Group 1 Subordinated Certificates and Aggregate Group II Subordinated Certificates.
Subordinated Certificates................. Class 1-B-1, Class B-1, Class 1-B-2, Class B-2, Class 1-B-3, Class B-3, Class 1-B-4,
Class B-4, Class 1-B-5, Class B-5, Class 1-B-6 and Class B-6 Certificates.
Targeted Principal Classes................ None.
Underwriter............................... Xxxxxx Xxxxxxx & Co. Incorporated.
With respect to any of the foregoing designations as to which the
corresponding reference is "None," all defined terms and provisions herein
relating solely to such designations shall be of no force or effect, and any
calculations herein incorporating references to such designations shall be
interpreted without reference to such designations and amounts. Defined terms
and provisions herein relating to statistical rating agencies not designated
above as Rating Agencies shall be of no force or effect.
ARTICLE I
DEFINITIONS
Section 1.01 Definitions.
The following words and phrases, unless the context otherwise requires,
shall have the following meanings:
Accountant: A Person engaged in the practice of accounting who (except
when this Agreement provides that an Accountant must be Independent) may be
employed by or affiliated with the Depositor or an Affiliate of the Depositor.
Acknowledgements: The Assignment, Assumption and Recognition
Agreements, each dated as of December 1, 2004, assigning rights under the
Purchase and Servicing Agreements
3
from the Seller to the Depositor and from the Depositor to the Trustee, for
the benefit of the Certificateholders.
Accretion Directed Certificates: As specified in the Preliminary
Statement.
Accretion Direction Rule: Not applicable.
Accrual Amount: With respect to any Class of Accrual Certificates or
any Accrual Component and any Distribution Date, the amount allocable to
interest on such Class of Accrual Certificates or Accrual Component with respect
to such Distribution Date pursuant to Section 5.02(a)(1)(iii), 5.02(a)(2)(iii),
5.02(a)(3)(iii), 5.02(a)(4)(iii) or 5.02(a)(5)(iii), as applicable.
Accrual Certificates: As specified in the Preliminary Statement.
Accrual Components: As specified in the Preliminary Statement.
Accrual Termination Date: Not applicable.
Act: The Securities Act of 1933, as amended.
Additional Collateral: With respect to any Additional Collateral
Mortgage Loan, the marketable securities and other acceptable collateral pledged
as collateral pursuant to the related pledge agreements.
Additional Collateral Mortgage Loan: Each Mortgage Loan identified as
such in the Mortgage Loan Schedule.
Adjustment Date: A date specified in each Mortgage Note as a date on
which the Mortgage Rate on the related Mortgage Loan will be adjusted.
Advance: With respect to a Mortgage Loan, the payments required to be
made by the Master Servicer or the applicable Servicer with respect to any
Distribution Date pursuant to this Agreement or the applicable Purchase and
Servicing Agreement, as applicable, the amount of any such payment being equal
to the aggregate of the payments of principal and interest (net of the
applicable Servicing Fee and net of any net income in the case of any REO
Property) on the Mortgage Loans that were due on the related Due Date and not
received as of the close of business on the related Determination Date, less the
aggregate amount of any such delinquent payments that the Master Servicer or the
applicable Servicer has determined would constitute Nonrecoverable Advances if
advanced.
Adverse REMIC Event: Either (i) loss of status as a REMIC, within the
meaning of Section 860D of the Code, for any group of assets identified as a
REMIC in the Preliminary Statement to this Agreement, or (ii) imposition of any
tax, including the tax imposed under Section 860F(a)(1) on prohibited
transactions, and the tax imposed under Section 860G(d) on certain contributions
to a REMIC, on any REMIC created hereunder to the extent such tax would be
payable from assets held as part of the Trust Fund.
4
Affiliate: With respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control" when used with respect to any
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
Aggregate Certificate Group: The Group 1 Certificates or Aggregate
Group II Certificates as the context requires.
Aggregate Expense Rate: With respect to any Mortgage Loan, the
applicable Servicing Fee Rate and, with respect to any LPMI Mortgage Loan, the
interest premium charged by the mortgagee to obtain or maintain any Primary
Insurance Policy.
Aggregate Group II Certificates: As specified in the Preliminary
Statement.
Aggregate Group II Senior Certificates: As specified in the
Preliminary Statement.
Aggregate Group II Subordinated Certificates: As specified in the
Preliminary Statement.
Aggregate Group II Weighted Average Rate: For the Interest Accrual
Period related to each Distribution Date, a per annum rate equal to the sum of
the following for each of Loan Group 2, Loan Group 3, Loan Group 4 and Loan
Group 5: the product of (x) the Weighted Average Net Mortgage Rate of the
Mortgage Loans in the related Loan Group and (y) a fraction, the numerator of
which is the related Subordinated Portion immediately prior to that Distribution
Date, and the denominator of which is the aggregate Class Principal Balance of
the Aggregate Group II Subordinated Certificates, in each case immediately prior
to that Distribution Date.
Aggregate Loan Group: Loan Group 1 or Aggregate Loan Group II, as the
context requires.
Aggregate Loan Group II: Collectively, Loan Group 2, Loan Group 3,
Loan Group 4 and Loan Group 5.
Aggregate Planned Balance: With respect to any group of Planned
Principal Classes or Components and any Distribution Date, the amount set forth
for such group for such Distribution Date in Schedule B hereto.
Aggregate Subordinated Percentage: As to any Distribution Date and each
Aggregate Loan Group, the fraction, expressed as a percentage, the numerator of
which is equal to the aggregate Class Principal Balance of the Subordinated
Certificates in the related Aggregate Certificate Group immediately prior to
such Distribution Date and the denominator of which is the aggregate Stated
Principal Balance of all the Mortgage Loans as of the Due Date in the month
preceding the month of such Distribution Date.
5
Aggregate Targeted Balance: With respect to any group of Targeted
Principal Classes or Components and any Distribution Date, the amount set forth
for such group for such Distribution Date in Schedule B hereto.
Aggregate Voting Interests: The aggregate of the Voting Interests of
all the Certificates under this Agreement.
Agreement: This Pooling and Servicing Agreement and all amendments or
supplements hereto.
Allocable Share: As to any Distribution Date, any Mortgage Loan in a
Loan Group and any Class or Component of Certificates related to that Loan
Group, the ratio that the amount calculated with respect to such Distribution
Date (A) with respect to the Senior Certificates of the related Senior
Certificate Group, pursuant to clause (i) of the definition of Class Optimal
Interest Distribution Amount (without giving effect to any reduction of such
amount pursuant to Section 5.02(d)) and (B) with respect to the Group 1
Subordinated Certificates after a Senior Termination Date or the Aggregate Group
II Subordinated Certificates after the third Senior Termination Date, as
applicable, pursuant to the definition of Assumed Interest Amount pursuant to
clause (i) of the definition of Class Optimal Interest Distribution Amount
(without giving effect to any reduction of such amount pursuant to Section
5.02(d)) bears to the amount calculated with respect to such Distribution Date
for each Class of Certificates pursuant to clause (i) of the definition of Class
Optimal Interest Distribution Amount (without giving effect to any reduction of
such amount pursuant to Section 5.02(d)) or the definition of Assumed Interest
Amount for such Loan Group and Class, as applicable).
Amount Held for Future Distribution: As to any Distribution Date and
Mortgage Loans in a Loan Group, the aggregate amount held in the Custodial
Accounts at the close of business on the related Determination Date on account
of (i) Principal Prepayments received after the related Prepayment Period and
Liquidation Proceeds and Subsequent Recoveries received in the month of such
Distribution Date relating to such Loan Group and (ii) all Scheduled Payments
due after the related Due Date relating to such Loan Group.
Applicable Credit Support Percentage: As defined in Section 5.02(e).
Appraised Value: With respect to any Mortgage Loan, the Appraised
Value of the related Mortgaged Property shall be: (i) with respect to a
Mortgage Loan other than a Refinancing Mortgage Loan, the lesser of (a) the
value of the Mortgaged Property based upon the appraisal made at the time of
the origination of such Mortgage Loan and (b) the sales price of the Mortgaged
Property at the time of the origination of such Mortgage Loan; and (ii) with
respect to a Refinancing Mortgage Loan, the value of the Mortgaged Property
based upon the appraisal made at the time of the origination of such
Refinancing Mortgage Loan.
Assignment of Mortgage: An assignment of the Mortgage, notice of
transfer or equivalent instrument, in recordable form, sufficient under the laws
of the jurisdiction wherein the related Mortgaged Property is located to reflect
the sale of the Mortgage to the Trustee, which assignment, notice of transfer or
equivalent instrument may be in the form of one or more blanket assignments
covering the Mortgage Loans secured by Mortgaged Properties located in
6
the same jurisdiction, if permitted by law; provided, however, that the
Trustee shall not be responsible for determining whether any such assignment
is in recordable form or sufficient under the laws of the applicable
jurisdiction to reflect the sale of the Mortgage to the Trustee.
Assignment of Proprietary Lease: With respect to a Cooperative Loan, an
assignment of the Proprietary Lease sufficient under the laws of the
jurisdiction wherein the related Cooperative Unit is located to reflect the
assignment of such Proprietary Lease; provided, however, that the Trustee shall
not be responsible for determining whether such assignment is sufficient to
reflect the assignment of the Proprietary Lease.
Assignment of Recognition Agreement: With respect to a Cooperative
Loan, an assignment of the Recognition Agreement sufficient under the laws of
the jurisdiction wherein the related Cooperative Unit is located to reflect the
assignment of such Recognition Agreement; provided, however, that the Trustee
shall not be responsible for determining whether such assignment is sufficient
to reflect the assignment of the Recognition Agreement.
Assumed Interest Amount: With respect to any Distribution Date and
Class of Subordinated Certificates, one month's interest accrued during the
related Interest Accrual Period at the Pass-Through Rate for such Class on the
applicable Subordinated Portion immediately prior to that Distribution Date.
Authenticating Agent: Any authenticating agent appointed pursuant to
Section 6.10 until any successor authenticating agent for the Certificates is
named, and thereafter "Authenticating Agent" shall mean any such successor. The
initial Authenticating Agent shall be the Securities Administrator under this
Agreement.
Authorized Officer: Any Person who may execute an Officer's
Certificate on behalf of the Depositor.
Available Funds: As to any Distribution Date and the Mortgage Loans in
a Loan Group, the sum, for that Loan Group, of (a) the aggregate amount held in
the Custodial Accounts at the close of business on the related Determination
Date, including any Subsequent Recoveries, in respect of such Mortgage Loans net
of the Amount Held for Future Distribution and net of amounts permitted to be
withdrawn from the Custodial Accounts pursuant to Section 4.02(a) in respect of
such Mortgage Loans and amounts permitted to be withdrawn from the Distribution
Account pursuant to clauses (i)-(v) inclusive of Section 4.02(b) in respect of
such Mortgage Loans, (b) the amount of all related Advances made by the
Servicers and the Master Servicer and all Compensating Interest Payments or
payments made in respect of Prepayment Interest Shortfalls paid by the Servicers
and the Master Servicer, (c) in connection with Defective Mortgage Loans in such
Loan Group, as applicable, the aggregate of the Purchase Prices and Substitution
Adjustment Amounts deposited on the related Distribution Account Deposit Date
and (d) in the case of a Loan Group in Aggregate Loan Group II, the Transfer
Payment Received plus interest thereon as provided in Section 5.08 for such Loan
Group less, in the case of a Loan Group in Aggregate Loan Group II, the Transfer
Payment Made plus interest thereon as provided in Section 5.08 for such Loan
Group; provided, however, that, with respect to Aggregate Loan Group II after
the third Senior Termination Date, Available Funds with respect to the Loan
Group relating to the remaining Senior Certificate Group in Aggregate
Certificate Group II shall
7
include the Available Funds from the other Loan Groups in Aggregate Loan Group
II and on any Distribution Date thereafter, Available Funds shall be
calculated based upon all the Mortgage Loans in Aggregate Loan Group II, as
opposed to the Mortgage Loans in the related Loan Group, minus (e) all related
fees, charges and other amounts payable or reimbursable to the Master
Servicer, the Securities Administrator, the applicable Custodian or the
Trustee under this Agreement or the applicable Custodial Agreement, to the
Servicers under the Purchase and Servicing Agreements, or, if any amounts are
not specifically related to the Mortgage Loans in that Loan Group or the
related Certificate Group, then the applicable Loan Group Percentage for such
Loan Group for such Distribution Date of such amounts. The Holders of the
Class P-1 and Class P-2 Certificates will be entitled to all Prepayment
Penalties received on the Group 1 Mortgage Loans or the Aggregate Group II
Mortgage Loans, as applicable, and such amounts will not be available for
distribution to the Holders of any other Class of Certificates.
B of A Serviced Mortgage Loan: Each Mortgage Loan originated and
serviced by Bank of America, National Association, and listed on the Mortgage
Loan Schedule.
B of A Purchase and Servicing Agreement: The Mortgage Loan Sale
Servicing Agreement listed in Exhibit E hereto between the Seller and Bank of
America, National Association.
Bankruptcy: As to any Person, the making of an assignment for the
benefit of creditors, the filing of a voluntary petition in bankruptcy,
adjudication as a bankrupt or insolvent, the entry of an order for relief in a
bankruptcy or insolvency proceeding, the seeking of reorganization, arrangement,
composition, readjustment, liquidation, dissolution or similar relief, or
seeking, consenting to or acquiescing in the appointment of a trustee, receiver
or liquidator, dissolution, or termination, as the case may be, of such Person
pursuant to the provisions of either the Bankruptcy Code or any other similar
state laws.
Bankruptcy Code: The United States Bankruptcy Code of 1986, as
amended.
Bankruptcy Coverage Termination Date: The point in time at which the
Bankruptcy Loss Coverage Amount is reduced to zero.
Bankruptcy Loss: With respect to any Mortgage Loan, a Deficient
Valuation or Debt Service Reduction reported to the Master Servicer by the
related Servicer; provided, however, that a Bankruptcy Loss shall not be deemed
a Bankruptcy Loss hereunder so long as the related Servicer has notified the
Master Servicer in writing that the related Servicer is diligently pursuing any
remedies that may exist in connection with the related Mortgage Loan and either
(A) the related Mortgage Loan is not in default with regard to payments due
thereunder or (B) delinquent payments of principal and interest under the
related Mortgage Loan and any related escrow payments in respect of such
Mortgage Loan are being advanced on a current basis by the Master Servicer or
the related Servicer, in either case without giving effect to any Debt Service
Reduction or Deficient Valuation, as reported by the related Servicer to the
Master Servicer.
Bankruptcy Loss Coverage Amount: As of any date of determination, the
Bankruptcy Loss Coverage Amount shall equal the Initial Bankruptcy Coverage
Amount as reduced by (i) the aggregate amount of Bankruptcy Losses allocated to
the Certificates since the Cut-off Date
8
and (ii) any permissible reductions in the Bankruptcy Loss Coverage Amount as
evidenced by a letter of each Rating Agency to the Trustee and the Securities
Administrator to the effect that any such reduction will not result in a
downgrading of the then current ratings assigned to the Classes of
Certificates rated by it.
Book-Entry Certificates: Beneficial interests in Certificates
designated as "Book-Entry Certificates" in this Agreement, ownership and
transfers of which shall be evidenced or made through book entries by a Clearing
Agency as described in Section 3.09; provided, that after the occurrence of a
Book-Entry Termination whereupon book-entry registration and transfer are no
longer permitted and Definitive Certificates are to be issued to Certificate
Owners, such Book-Entry Certificates shall no longer be "Book-Entry
Certificates." The Classes of Certificates that constitute "Book-Entry
Certificates" as of the Closing Date are set forth in the Preliminary Statement.
Book-Entry Termination: The date on which the Clearing Agency is no
longer willing or able to properly discharge its responsibilities with respect
to the Book Entry Certificates, and the Depositor is unable to locate a
qualified successor.
Business Day: Any day other than (i) a Saturday or a Sunday or (ii) a
day on which banking institutions in New York, New York or, if other than New
York, the city in which the Corporate Trust Office of the Trustee is located, or
the States of Illinois, Maryland or Minnesota, are authorized or obligated by
law or executive order to be closed.
Calculation Rate: For each Distribution Date: (a) the product of (i) 10
and (ii) the weighted average rate of the outstanding Class A and Class B
Interests, treating each Class A Interest as capped at zero or reduced by a
fixed percentage of 100% of the interest accruing on such Class.
Cendant Purchase and Servicing Agreement: The Mortgage Loan Sale
Servicing Agreement listed in Exhibit E hereto between the Seller and Cendant
Mortgage Corporation.
Cendant Serviced Mortgage Loan: Each Mortgage Loan originated and
serviced by Cendant Mortgage Corporation or Xxxxxx'x Gate Residential Mortgage
Trust and listed on the Mortgage Loan Schedule.
Certificate: Any one of the certificates signed by the Trustee, or the
Securities Administrator on the Trustee's behalf, and authenticated by the
Securities Administrator as Authenticating Agent in substantially the forms
attached hereto as Exhibit A.
Certificate Balance: With respect to any Certificate at any date, the
maximum dollar amount of principal to which the Holder thereof is then entitled
hereunder, such amount being equal to the principal balance or notional amount,
as applicable, as of the Closing Date (A) plus any Subsequent Recoveries added
to the Certificate Balance of such Certificate pursuant to Section 5.02, (B)
minus the sum of (i) all distributions of principal previously made with respect
thereto and (ii) all Realized Losses allocated thereto and, in the case of any
Subordinated Certificates, all other reductions in Certificate Balance
previously allocated thereto pursuant to Section 5.04 and (C) in the case of any
Class of Accrual Certificates, increased by the Accrual Amount added to the
Class Principal Balance of such Class prior to such date.
9
Certificate Group: As specified in the Preliminary Statement.
Certificate Owner: With respect to a Book-Entry Certificate, the Person
who is the owner of such Book-Entry Certificate, as reflected on the books of
the Clearing Agency, or on the books of a Person maintaining an account with
such Clearing Agency (directly or as an indirect participant, in accordance with
the rules of such Clearing Agency).
Certificate Register and Certificate Registrar: The register
maintained and the registrar appointed pursuant to Section 3.02. The initial
Certificate Registrar is the Securities Administrator under this Agreement.
Certificateholder: The meaning provided in the definition of
"Holder."
Class: All Certificates bearing the same Class designation as set
forth in the Preliminary Statement.
Class 1-A Corridor Contract: The ISDA Master Agreement (including the
Schedule thereto and the transaction evidenced by the related Confirmation by
and between the Securities Administrator on behalf of the Trustee and the
Corridor Contract Counterparty), for the benefit of the Class 1-A-1, Class
1-A-2A and Class 1-A-2B Certificates.
Class 1-A Corridor Contract Payment: On each Distribution Date prior to
the related Corridor Contract Termination Date, the amount required to be paid
by the Corridor Contract Counterparty on behalf of Class 1-A-1, Class 1-A-2A and
Class 1-A-2B Certificates the under the Class 1-A Corridor Contract on that
Distribution Date.
Class 1-B-1 Corridor Contract: The ISDA Master Agreement (including the
Schedule thereto and the transaction evidenced by the related Confirmation by
and between the Securities Administrator on behalf of the Trustee and the
Corridor Contract Counterparty), for the benefit of the Class 1-B-1
Certificates.
Class 1-B-1 Corridor Contract Payment: On each Distribution Date prior
to the related Corridor Contract Termination Date, the amount required to be
paid by the Corridor Contract Counterparty under the Class 1-B-1 Corridor
Contract on that Distribution Date.
Class 1-B-2 Corridor Contract: The ISDA Master Agreement (including the
Schedule thereto and the transaction evidenced by the related Confirmation by
and between the Securities Administrator on behalf of the Trustee and the
Corridor Contract Counterparty), for the benefit of the Class 1-B-2
Certificates.
Class 1-B-2 Corridor Contract Payment: On each Distribution Date prior
to the related Corridor Contract Termination Date, the amount required to be
paid by the Corridor Contract Counterparty under the Class 1-B-2 Corridor
Contract on that Distribution Date.
Class 1-B-3 Corridor Contract: The ISDA Master Agreement (including the
Schedule thereto and the transaction evidenced by the related Confirmation by
and between the Securities Administrator on behalf of the Trustee and the
Corridor Contract Counterparty), for the benefit of the Class 1-B-3
Certificates.
10
Class 1-B-3 Corridor Contract Payment: On each Distribution Date prior
to the related Corridor Contract Termination Date, the amount required to be
paid by the Corridor Contract Counterparty under the Class 1-B-3 Corridor
Contract on that Distribution Date.
Class 1-X-1 Required Reserve Fund Deposit: For any Distribution Date to
and including the Distribution Date in June 2007, an amount equal to the lesser
of (i) the Current Interest for the Class 1-X-1 Certificates for such
Distribution Date and (ii) the amount required to bring the balance on deposit
in the Class 1-X-1 Sub Account up to an amount equal to the sum of (a) the
aggregate Net WAC Shortfalls for the Class 1-A-1, Class 1-A-2A and Class 1-A-2B
Certificates for such Distribution Date remaining unpaid after application of
payments under both the related Corridor Contract and the Required Reserve Fund
Deposit for the Class 1-X-2 Certificates for that Distribution Date and (b)
$4,500. Commencing with the Distribution Date in July 2007, the Class
1-X-1Required Reserve Fund Deposit shall be zero.
Class 1-X-2 Required Reserve Fund Deposit: For any Distribution Date,
an amount equal to the lesser of (i) the Current Interest for the Class 1-X-2
Certificates for such Distribution Date and (ii) the amount required to bring
the balance on deposit in the Class 1-X-2 Sub Account up to an amount equal to
the sum of (a) the aggregate Net WAC Shortfalls for the Class 1-A-1, Class
1-A-2A and Class 1-A-2B Certificates for such Distribution Date remaining unpaid
after application of payments under the related Corridor Contract on that
Distribution Date and (b) $4,500.
Class 1-X-B Required Reserve Fund Deposit: For any Distribution Date,
an amount equal to the lesser of (i) the Current Interest for the Class 1-X-B
Certificates for such Distribution Date and (ii) the amount required to bring
the balance on deposit in the Class 1-X-B Sub Account up to an amount equal to
the sum of (a) the Net WAC Shortfalls for such Distribution Date with respect to
the Class 1-B-1, Class 1-B-2 and Class 1-B-3 Certificates remaining unpaid after
application of payments under the related Corridor Contracts, and (b) $1,000.
Class 1-X-1 Sub Account: As defined in Section 5.10(b).
Class 1-X-2 Sub Account: As defined in Section 5.10(b).
Class 1-X-B Sub Account: As defined in Section 5.10(b).
Class Interest Shortfall: As to any Distribution Date and Class, the
amount by which the amount described in clause (i) of the definition of Class
Optimal Interest Distribution Amount for such Class exceeds the amount of
interest actually distributed on such Class on such Distribution Date pursuant
to such clause (i).
Class Optimal Interest Distribution Amount: With respect to any
Distribution Date and interest bearing Class or, with respect to any interest
bearing Component, the sum of (i) one month's interest accrued during the
related Interest Accrual Period at the Pass-Through Rate for such Class on the
related Class Principal Balance, Component Balance, Notional Amount or Component
Notional Amount, as applicable, immediately prior to such Distribution Date,
subject to reduction as provided in Section 5.02(d) and (ii) any Class Unpaid
Interest Amounts for such Class or Component.
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Class Principal 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 Subordination Percentage: With respect to any Distribution Date
and each Class of Group 1 Subordinated Certificates, the quotient (expressed as
a percentage) of (a) the Class Principal Balance of such Class of Group 1
Subordinated Certificates immediately prior to such Distribution Date, divided
by (b) the aggregate of the Class Principal Balances of all Classes of Group 1
Certificates (other than the related Notional Amount Certificates) immediately
prior to such Distribution Date. With respect to any Distribution Date and each
Class of Aggregate Group II Subordinated Certificates, the quotient (expressed
as a percentage) of (a) the Class Principal Balance of such Class of Aggregate
Group II Subordinated Certificates immediately prior to such Distribution Date,
divided by (b) the aggregate of the Class Principal Balances of all Classes of
Aggregate Group II Certificates (other than the related Notional Amount
Certificates) immediately prior to such Distribution Date.
Class Unpaid Interest Amounts: As to any Distribution Date and Class of
interest bearing Certificates, the amount by which the aggregate Class Interest
Shortfalls for such Class on prior Distribution Dates exceeds the amount
distributed on such Class on prior Distribution Dates pursuant to clause (ii) of
the definition of Class Optimal Interest Distribution Amount.
Clearing Agency: An organization registered as a "clearing agency"
pursuant to Section 17A of the Securities Exchange Act of 1934, as amended. As
of the Closing Date, the Clearing Agency shall be The Depository Trust Company.
Clearing Agency Participant: A broker, dealer, bank, other financial
institution or other Person for whom from time to time a Clearing Agency effects
book-entry transfers and pledges of securities deposited with the Clearing
Agency.
Closing Date: December 29, 2004.
Code: The Internal Revenue Code of 1986, as amended, and as it may be
further amended from time to time, any successor statutes thereto, and
applicable U.S. Department of Treasury regulations issued pursuant thereto in
temporary or final form.
Compensating Interest Payment: As to any Distribution Date, an amount
equal to the lesser of (i) the Prepayment Interest Shortfall on the Mortgage
Loans serviced by such Servicer with respect to such Distribution Date and (ii)
the portion of the applicable Servicing Fee that the related Servicer is
required to remit to the Trust as compensation therefor in accordance with the
terms of the related Purchase and Servicing Agreement.
Component: As specified in the Preliminary Statement.
Component Balance: With respect to any Component and any Distribution
Date, the Initial Component Balance thereof on the Closing Date, (A) plus any
Subsequent Recoveries added to the Component Balance of such Component pursuant
to Section 5.02, (B) minus the sum of all amounts applied in reduction of the
principal balance of such Component and Realized Losses allocated thereto on
previous Distribution Dates.
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Component Certificates: As specified in the Preliminary Statement.
Component Notional Amount: Not applicable.
Confirmation: With respect to each Corridor Contract, the related
Confirmation dated December 29, 2004, evidencing the transaction between the
Counterparty and the Securities Administrator on behalf of the Trustee.
Consent: A document executed by the Cooperative Corporation (i)
consenting to the sale of the Cooperative Unit to the Mortgagor and (ii)
certifying that all maintenance charges relating to the Cooperative Unit have
been paid.
Cooperative Corporation: The entity that holds title (fee or an
acceptable leasehold estate) to the real property and improvements constituting
the Cooperative Property and which governs the Cooperative Property, which
Cooperative Corporation must qualify as a Cooperative Housing Corporation under
Section 216 of the Code.
Cooperative Loan: A Mortgage Loan secured by Cooperative Shares and a
Proprietary Lease, if any.
Cooperative Property: The real property and improvements owned by the
Cooperative Corporation, that includes the allocation of individual dwelling
units to the holders of the shares of the Cooperative Corporation.
Cooperative Shares: Shares issued by a Cooperative Corporation.
Cooperative Unit: With respect to any Cooperative Loan, a specific
unit in a Cooperative Property.
Corporate Trust Office: With respect to the Trustee, the designated
office of the Trustee in the State of California 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 0000
Xxxx Xx. Xxxxxx Xxxxx, Xxxxx Xxx, Xxxxxxxxxx 00000, Attn: Trust
Administration-MS0411, and which is the address to which notices to and
correspondence with the Trustee should be directed, or at such other address as
the Trustee may designate from time to time by notice to the Certificateholders,
the Depositor, the Master Servicer and the Securities Administrator or the
principal corporate trust office of any successor Trustee. With respect to the
Certificate Registrar and presentment of Certificates for registration of
transfer, exchange or final payment, Xxxxx Fargo Bank, National Association,
Xxxxx Xxxxxx xxx Xxxxxxxxx Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxx 00000, Attention:
Corporate Trust, Xxxxxx Xxxxxxx Mortgage Loan Trust 2004-11AR, and for all other
purposes, X.X. Xxx 00, Xxxxxxxx, Xxxxxxxx 00000 (or for overnight deliveries,
0000 Xxx Xxxxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxx 00000), Attention: Corporate Trust,
Xxxxxx Xxxxxxx Mortgage Loan Trust 2004-11AR.
Corridor Contract Counterparty: Xxxxxx Xxxxxxx Capital Services Inc.
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Corridor Contract Termination Date: With respect to each Corridor
Contract the related Distribution Date set forth on the notional balance
schedule therein, after any required payment is made.
Corridor Contracts: Collectively, Class 1-A Corridor Contract, the
Class 1-B-1 Corridor Contract, the Class 1-B-2 Corridor Contract and the Class
1-B-3 Corridor Contract.
Cross-Over Situation: For any Distribution Date and for each Loan Group
(after taking into account principal distributions on such Distribution Date)
with respect to the Class A and Class B Interests, the Class A and Class B
Interests corresponding to any Loan Group are in the aggregate less than 1% of
the Subordinated Portion of the Loan Group to which they correspond.
Current Interest: For any Distribution Date and any Class of
Certificates, the interest accrued during the related Interest Accrual Period at
the Pass-Through Rate for such Class of Certificates on the related Class
Principal Balance immediately prior to such Distribution Date.
Custodial Account: Each custodial account (other than an Escrow
Account) established and maintained by a Servicer pursuant to a Purchase and
Servicing Agreement.
Custodial Agreement: The Custodial Agreements, listed in Exhibit F
hereof, as each such agreement may be amended or supplemented from time to time
as permitted hereunder.
Custodial Certification: As defined in Section 2.01.
Custodian: A Person who is at anytime appointed by the Depositor as a
custodian of the Mortgage Documents and the Trustee Mortgage Files. The initial
Custodians are JPMorgan Chase Bank, National Association and Deutsche Bank
National Trust Company. "Custodian" shall refer to each Custodian or both
Custodians, as the context requires.
Cut-off Date: December 1, 2004.
Cut-off Date Pool Principal Balance: $1,166,333,621.
Cut-off Date Principal Balance: As to any Mortgage Loan, the Stated
Principal Balance thereof as of the close of business on the Cut-off Date.
Debt Service Reduction: With respect to any Mortgage Loan, a reduction
by a court of competent jurisdiction in a proceeding under the Bankruptcy Code
in the Scheduled Payment for such Mortgage Loan which became final and
non-appealable, except such a reduction resulting from a Deficient Valuation or
any reduction that results in a permanent forgiveness of principal.
Deceased Holder: Not applicable.
Defective Mortgage Loan: The meaning specified in Section 2.05(a).
Deficient Valuation: With respect to any Mortgage Loan, a valuation of
the related Mortgaged Property by a court of competent jurisdiction in an amount
less than the then outstanding indebtedness under the Mortgage Loan, or any
reduction in the amount of principal
14
to be paid in connection with any Scheduled Payment that results in a
permanent forgiveness of principal, which valuation or reduction results from
an order of such court which is final and non-appealable in a proceeding under
the Bankruptcy Code.
Definitive Certificate: A Certificate of any Class issued in
definitive, fully registered, certificated form. As of the Closing Date the
Classes of Certificates being issued as "Definitive Certificates" are set forth
in the Preliminary Statement.
Delay Certificates: As specified in the Preliminary Statement.
Deleted Mortgage Loan: A Mortgage Loan that is repurchased, or
replaced or to be replaced with a Replacement Mortgage Loan.
Delinquent: Any Mortgage Loan with respect to which the Scheduled
Payment due on a Due Date is not received.
Depositor: Xxxxxx Xxxxxxx Capital I Inc., a Delaware corporation
having its principal place of business in New York, or its successors in
interest.
Determination Date: With respect to each Servicer, the "Determination
Date" set forth in the related Purchase and Servicing Agreement.
Disqualified Organization: A "disqualified organization" as defined
in Section 860E(e)(5) of the Code.
Distribution Account: The separate Eligible Account created and
maintained by the Securities Administrator, on behalf of the Trustee, pursuant
to Section 4.01. Funds in the Distribution Account (exclusive of any earnings on
investments made with funds deposited in the Distribution Account) shall be held
in trust for the Trustee and the Certificateholders for the uses and purposes
set forth in this Agreement.
Distribution Account Deposit Date: With respect to each Servicer, not
later than 1:00 p.m., New York time, on 18th day of each calendar month after
the initial issuance of the Certificates or, if such 18th day is not a Business
Day, the immediately following Business Day, commencing in January 2005.
Distribution Date: The 25th day of each month or, if such 25th day is
not a Business Day, the next succeeding Business Day, commencing in January
2005.
Due Date: With respect to any Mortgage Loan, the date on which a
Scheduled Payment is due under the related Mortgage Note as indicated in the
applicable Purchase and Servicing Agreement.
Due Period: As to any Distribution Date, the period beginning on the
second day of the month preceding the month of such Distribution Date, and
ending on the first day of the month of such Distribution Date.
15
Eligible Account: Any of (i) an account or accounts maintained with a
federal or state chartered depository institution or trust company the
short-term unsecured debt obligations of which (or, in the case of a depository
institution or trust company that is the principal subsidiary of a holding
company, the debt obligations of such holding company) have the highest
short-term ratings of each Rating Agency at the time any amounts are held on
deposit therein, or (ii) an account or accounts in a depository institution or
trust company in which such accounts are insured by the FDIC or the SAIF (to the
limits established by the FDIC or the SAIF) and the uninsured deposits in which
accounts are otherwise secured such that, as evidenced by an Opinion of Counsel
delivered to the Trustee and to each Rating Agency, the Certificateholders have
a claim with respect to the funds in such account or a perfected first priority
security interest against any collateral (which shall be limited to Permitted
Investments) securing such funds that is superior to claims of any other
depositors or creditors of the depository institution or trust company in which
such account is maintained, or (iii) a trust account or accounts maintained with
the trust department of a federal or state chartered depository institution or
trust company, acting in its fiduciary capacity or (iv) any other account
acceptable to each Rating Agency, as evidenced by a signed writing delivered by
each Rating Agency. Eligible Accounts may bear interest, and may include, if
otherwise qualified under this definition, accounts maintained with the Trustee,
the Paying Agent, the Securities Administrator or the Master Servicer.
Eligible Institution: An institution having the highest short-term debt
rating, and one of the two highest long-term debt ratings of the Rating Agencies
or the approval of the Rating Agencies.
ERISA: The Employee Retirement Income Security Act of 1974, as
amended.
ERISA-Qualifying Underwriting: A best efforts or firm commitment
underwriting or private placement that meets the requirements of an
Underwriter's Exemption.
ERISA-Restricted Certificate: As specified in the Preliminary
Statement.
Escrow Account: With respect to each Mortgage Loan, as defined in
Article I of the related Purchase and Servicing Agreement.
Estoppel Letter: A document executed by the Cooperative Corporation
certifying, with respect to a Cooperative Unit, (i) the appurtenant Proprietary
Lease will be in full force and effect as of the date of issuance thereof, (ii)
the related stock certificate was registered in the Mortgagor's name and the
Cooperative Corporation has not been notified of any lien upon, pledge of, levy
of execution on or disposition of such stock certificate, and (iii) the
Mortgagor is not in default under the appurtenant Proprietary Lease and all
charges due the Cooperative Corporation have been paid.
Event of Default: Any one of the conditions or circumstances
enumerated in Section 6.14.
Excess Loss: With respect to the Group 1 Certificates and the Aggregate
Group II Certificates, the amount of any (i) Fraud Loss on a Mortgage Loan in
any Loan Group in the related Aggregate Loan Group realized after the related
Fraud Loss Coverage Termination Date,
16
(ii) Special Hazard Loss on a Mortgage Loan in any Loan Group in the
related Aggregate Loan Group realized after the related Special Hazard
Coverage Termination Date or (iii) Bankruptcy Loss on a Mortgage Loan in any
Loan Group in the related Aggregate Loan Group realized after the related
Bankruptcy Coverage Termination Date.
Xxxxxx Xxx: The entity formerly known as the Federal National Mortgage
Association, a federally chartered and privately owned corporation organized and
existing under the Federal National Mortgage Association Charter Act, or any
successor thereto.
FDIC: The Federal Deposit Insurance Corporation or any successor
thereto.
FHLMC: The Federal Home Loan Mortgage Corporation, a corporate
instrumentality of the United States created and existing under Title III of the
Emergency Home Finance Act of 1970, as amended, or any successor thereto.
Fiscal Agent: Not applicable.
Fitch: Fitch, Inc., or any successor thereto. If Fitch is designated
as a Rating Agency in the Preliminary Statement, for purposes of Section 11.07
the address for notices to Fitch shall be Fitch, Inc., Xxx Xxxxx Xxxxxx Xxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attention: Residential Mortgage Surveillance Group,
or such other address as Fitch may hereafter furnish to the Depositor, the
Trustee and the Master Servicer.
Fraud Loan: A Liquidated Mortgage Loan as to which a Fraud Loss has
occurred, as reported by the related Servicer to the Master Servicer.
Fraud Loss Coverage Amount: As of the Closing Date, (x) $17,872,243,
with respect to the Group 1 Certificates and (y) $11,411,843, with respect to
the Aggregate Group II Certificates, in each case, subject to reduction from
time to time, by the amount of Fraud Losses allocated to the Certificates. The
Fraud Loss Coverage Amount for the Group 1 Mortgage Loans will be reduced, from
time to time, by the amount of Fraud Losses allocated to the Group 1
Certificates. In addition, the Fraud Loss Coverage Amount for the Group 1
Mortgage Loans will be reduced on the fifth anniversary of the Cut-off Date, to
zero and on the first, second, third and fourth anniversaries of the Cut-off
Date, to an amount equal to the lesser of (x) 2%, in the case of the first
anniversary, and 1%, in the case of the second, third and fourth anniversaries,
of the then current aggregate Stated Principal Balance of the Group 1 Mortgage
Loans and (y) the excess of the Fraud Loss Coverage Amount as of the preceding
anniversary of the Cut-off Date over the cumulative amount of Fraud Losses
allocated to the Group 1 Certificates since the preceding anniversary. The Fraud
Loss Coverage Amount for the Aggregate Group II Mortgage Loans will be reduced,
from time to time, by the amount of Fraud Losses allocated to the Aggregate
Group II Certificates. In addition, the Fraud Loss Coverage Amount for the
Aggregate Group II Mortgage Loans will be reduced on the fifth anniversary of
the Cut-off Date, to zero and on the first, second, third and fourth
anniversaries of the Cut-off Date, to an amount equal to the lesser of 1% of the
then current aggregate Stated Principal Balance of the Aggregate Group II
Mortgage Loans and (y) the excess of the Fraud Loss Coverage Amount as of the
preceding anniversary of the Cut-off Date over the cumulative amount of Fraud
Losses allocated to the Aggregate Group II Certificates since the preceding
anniversary.
17
Fraud Loss Coverage Termination Date: With respect to each Aggregate
Certificate Group the point in time at which the related Fraud Loss Coverage
Amount is reduced to zero.
Fraud Losses: Realized Losses on Mortgage Loans as to which a loss is
sustained by reason of a default arising from fraud, dishonesty or
misrepresentation in connection with the related Mortgage Loan, including a loss
by reason of the denial of coverage under any related Primary Mortgage Insurance
Policy because of such fraud, dishonesty or misrepresentation.
Global Securities: The global certificates representing the
Book-Entry Certificates.
GreenPoint Serviced Mortgage Loan: Each Mortgage Loan originated and
serviced by GreenPoint Mortgage Funding, Inc. and listed on the Mortgage Loan
Schedule.
GreenPoint Purchase and Servicing Agreement: The Mortgage Loan Sale
Servicing Agreement listed in Exhibit E hereto between the Seller and
GreenPoint Mortgage Funding, Inc.
Group 1 Certificates: As specified in the Preliminary Statement.
Group 1 Mortgage Loans: The Mortgage Loans in Loan Group 1.
Group 1 Senior Certificates: As specified in the Preliminary
Statement.
Group 1 Subordinated Certificates: As specified in the Preliminary
Statement.
Group 1 Net WAC: For the LIBOR Certificates and any Distribution
Date, a per annum rate equal to the Weighted Average Net Mortgage Rate of the
Group 1 Mortgage Loans as of the first day of the month preceding the month in
which such Distribution Date occurs.
Group 2 Senior Certificates: As specified in the Preliminary
Statement.
Group 2 Mortgage Loans: The Mortgage Loans in Loan Group 2.
Group 2 Senior Certificates: As specified in the Preliminary
Statement.
Group 3 Senior Certificates: As specified in the Preliminary
Statement.
Group 3 Mortgage Loans: The Mortgage Loans in Loan Group 3.
Group 4 Senior Certificates: As specified in the Preliminary
Statement.
Group 4 Mortgage Loans: The Mortgage Loans in Loan Group 4.
Group 5 Mortgage Loans: The Mortgage Loans in Loan Group 5.
Group 5 Senior Certificates: As specified in the Preliminary
Statement.
Holder: The registered owner of any Certificate as recorded on the
books of the Certificate Registrar except that, solely for the purposes of
taking any action or giving any consent pursuant to this Agreement, any
Certificate registered in the name of the Depositor, the
18
Trustee, the Master Servicer, the Securities Administrator and any Servicer,
or any Affiliate thereof shall be deemed not to be outstanding in determining
whether the requisite percentage necessary to effect any such consent has been
obtained, except that, in determining whether the Trustee or the Securities
Administrator shall be protected in relying upon any such consent, only
Certificates that a Responsible Officer of the Trustee or the Securities
Administrator, respectively, knows to be so owned shall be disregarded. The
Trustee or the Securities Administrator may request and conclusively rely on
certifications by the Depositor, the Master Servicer, the Securities
Administrator or any Servicer in determining whether any Certificates are
registered to an Affiliate of the Depositor, the Master Servicer, the
Securities Administrator or any Servicer.
HUD: The United States Department of Housing and Urban Development,
or any successor thereto.
Independent: When used with respect to any Accountants, a Person who is
"independent" within the meaning of Rule 2-01(b) of the Securities and Exchange
Commission's Regulation S-X. When used with respect to any other Person, a
Person who (a) is in fact independent of another specified Person and any
Affiliate of such other Person, (b) does not have any material direct financial
interest in such other Person or any Affiliate of such other Person, and (c) is
not connected with such other Person or any Affiliate of such other Person as an
officer, employee, promoter, underwriter, trustee, partner, director or Person
performing similar functions.
Index: As to each Mortgage Loan, the index from time to time in effect
for adjustment of the Mortgage Rate as set forth as such on the related Mortgage
Note.
Initial Bankruptcy Coverage Amount: With respect to the Group 1
Certificates, $211,654. With respect to the Aggregate Group II Certificates,
$248,561.
Initial Component Balance: As specified in the Preliminary Statement.
Initial Optional Purchase Date: With respect to the Group 1 Mortgage
Loans, the first Distribution Date following the date on which the aggregate
Stated Principal Balance of the Group 1 Mortgage Loans is equal to or less than
1% of the aggregate Stated Principal Balance thereof as of the Cut-off Date.
With respect to the Aggregate Group II Mortgage Loans, the first Distribution
Date following the date on which the aggregate Stated Principal Balance of the
Aggregate Group II Mortgage Loans is equal to or less than 1% of the aggregate
Stated Principal Balance thereof as of the Cut-off Date.
Insurance Policy: With respect to any Mortgage Loan, any insurance
policy, including all names and endorsements thereto in effect, including any
replacement policy or policies for any Insurance Policies.
Insurance Proceeds: Proceeds paid by any Insurance Policy (excluding
proceeds required to be applied to the restoration and repair of the related
Mortgaged Property or released to the Mortgagor), in each case other than any
amount included in such Insurance Proceeds in respect of Insured Expenses and
the proceeds from any Limited Purpose Surety Bond.
19
Insured Expenses: Expenses covered by an Insurance Policy or any other
insurance policy with respect to the Mortgage Loans.
Interest Accrual Period: With respect to each Class of Delay
Certificates, its corresponding Subsidiary REMIC Regular Interest and any
Distribution Date, the calendar month prior to the month of such Distribution
Date. With respect to any Class of Non-Delay Certificates, its corresponding
Subsidiary REMIC Regular Interest and any Distribution Date, the one month
period commencing on the 25th day of the month preceding the month in which such
Distribution Date (or the Closing Date, in the case of the first Distribution
Date) occurs and ending on the 24th day of the month in which such Distribution
Date occurs.
Interest Determination Date: With respect to any Interest Accrual
Period for any Class of LIBOR Certificates, the second Business Day prior to the
first day of such Interest Accrual Period.
Last Scheduled Distribution Date: The Distribution Date in January
2035.
Latest Possible Maturity Date: The Distribution Date occurring in
January 2035.
LIBOR: The London interbank offered rate for one-month United States
dollar deposits calculated in the manner described in Section 5.09.
LIBOR Business Day: Any day on which banks in London, England and The
City of New York are open and conducting transactions in foreign currency and
exchange.
LIBOR Certificates: As specified in the Preliminary Statement.
Limited Purpose Surety Bond: Collectively, Ambac Assurance
Corporation Surety Bond No. AB0039BE and any other Limited Purpose Surety Bond
securing an Additional Collateral Mortgage Loan.
Liquidated Mortgage Loan: With respect to any Distribution Date, a
defaulted Mortgage Loan (including any REO Property) which was liquidated in the
calendar month preceding the month of such Distribution Date and as to which the
related Servicer has certified (in accordance with its Purchase and Servicing
Agreement) that it has received all amounts it expects to receive in connection
with the liquidation of such Mortgage Loan including the final disposition of an
REO Property.
Liquidation Proceeds: Amounts, including Insurance Proceeds, received
in connection with the partial or complete liquidation of defaulted Mortgage
Loans, whether through trustee's sale, foreclosure sale or otherwise or amounts
received in connection with any condemnation or partial release of a Mortgaged
Property and any other proceeds received in connection with an REO Property.
Living Holders: Not applicable.
Loan Group: Any of Loan Group 1, Loan Group 2, Loan Group 3, Loan
Group 4 or Loan Group 5, as applicable.
20
Loan Group 1: All Mortgage Loans identified as Group 1 Mortgage Loans
on the Mortgage Loan Schedule.
Loan Group 2: All Mortgage Loans identified as Group 2 Mortgage Loans
on the Mortgage Loan Schedule.
Loan Group 3: All Mortgage Loans identified as Group 3 Mortgage Loans
on the Mortgage Loan Schedule.
Loan Group 4: All Mortgage Loans identified as Group 4 Mortgage Loans
on the Mortgage Loan Schedule.
Loan Group 5: All Mortgage Loans identified as Group 5 Mortgage Loans
on the Mortgage Loan Schedule.
Loan Group Percentage: As to any Loan Group and any Distribution Date,
the fraction, expressed as a percentage, the numerator of which is the aggregate
Stated Principal Balance of all of the Mortgage Loans in that Loan Group as of
the related Due Date, and the denominator of which is the aggregate Stated
Principal Balance of all of the Mortgage Loans as of that Due Date.
Loan Group Principal Balance: As to any Distribution Date and Loan
Group, the aggregate Stated Principal Balance of the Mortgage Loans in that Loan
Group outstanding on the Due Date in the month preceding the month of the
Distribution Date (after giving effect to prepayments received in the Prepayment
Period related to such prior Due Date).
Loan-To-Value Ratio: With respect to any Mortgage Loan and as to any
date of determination, the fraction (expressed as a percentage) the numerator of
which is the principal balance of the related Mortgage Loan at such date of
determination and the denominator of which is the Appraised Value of the related
Mortgaged Property.
LPMI Mortgage Loan: Certain Mortgage Loans as to which the lender
(rather than the borrower) acquires the Primary Mortgage Insurance Policy and
charges the related borrower an interest premium.
Master REMIC: As described in the Preliminary Statement.
Master Servicer: Xxxxx Fargo Bank, National Association, a national
banking association organized under the laws of the United States in its
capacity as Master Servicer and any Person succeeding as Master Servicer
hereunder or any successor in interest, or if any successor master servicer
shall be appointed as herein provided, then such successor master servicer.
Master Servicer Compensation: With respect to any Master Servicer that
is a successor to Xxxxx Fargo Bank, National Association as Master Servicer, the
portion of the earnings on the funds on deposit in the Distribution Account
payable on each Distribution Date pursuant to Section 4.02(b)(ii) hereof agreed
to by and between such successor Master Servicer and the successor securities
administrator; provided, that the sum of such Master Servicer Compensation and
the Securities Administrator Compensation payable on each Distribution Date
shall not
21
exceed the total earnings on funds in the Distribution Account payable
pursuant to Section 4.02(b)(ii) hereof earned since the prior Distribution Date.
Memorandum: The private placement memorandum dated December 29, 2004,
relating to the Private Certificates.
MERS: Mortgage Electronic Registration Systems, Inc., a corporation
organized and existing under the laws of the State of Delaware, or any
successor to Mortgage Electronic Registration Systems, Inc.
MERS Mortgage Loan: Any Mortgage Loan registered with MERS on the
MERS(R) System.
MERS(R) System: The system of recording transfers of mortgages
electronically maintained by MERS.
Middle REMIC: As specified in the Preliminary Statement.
Middle REMIC Interest: As specified in the Preliminary Statement.
Middle REMIC Regular Interest: As specified in the Preliminary
Statement.
MIN: The mortgage identification number for any MERS Mortgage Loan.
MOM Loan: Any Mortgage Loan as to which MERS is acting as mortgagee,
solely as nominee for the originator of such Mortgage Loan and its successors
and assigns.
Moody's: Xxxxx'x Investors Service, Inc., or any successor thereto. If
Xxxxx'x is designated as a Rating Agency in the Preliminary Statement, for
purposes of Section 11.07 the address for notices to Moody's shall be Xxxxx'x
Investors Service, Inc., 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Residential Pass-Through Monitoring, or such other address as Moody's may
hereafter furnish to the Depositor or the Master Servicer.
Mortgage: A mortgage, deed of trust or other instrument encumbering a
fee simple interest in real property securing a Mortgage Note, together with
improvements thereto.
Mortgage Documents: With respect to each Mortgage Loan, the mortgage
documents required to be delivered to the Custodian pursuant to each Custodial
Agreement.
Mortgage Loan: A Mortgage and the related notes or other evidences of
indebtedness secured by each such Mortgage conveyed, transferred, sold, assigned
to or deposited with the Trustee pursuant to Section 2.01 (including any REO
Property), including without limitation, each Mortgage Loan listed on the
Mortgage Loan Schedule, as amended from time to time.
Mortgage Loan Schedule: The schedule attached hereto as Schedule A,
which shall identify each Mortgage Loan, as such schedule may be amended by the
Depositor or a Servicer from time to time to reflect the addition of Replacement
Mortgage Loans to, or the deletion of Deleted Mortgage Loans from, the Trust
Fund. Such schedule shall, among other things
22
(i) designate the Servicer servicing such Mortgage Loan and the applicable
Servicing Fee Rate; (ii) identify the designated Loan Group in which such
Mortgage Loan is included, (iii) identify any LPMI Mortgage Loan and designate
the rate at which the premium for such insurance is calculated and (iv)
separately identify the Additional Collateral Mortgage Loans, if any.
Mortgage Note: The original executed note or other evidence of the
indebtedness of a Mortgagor secured by a Mortgage under a Mortgage Loan.
Mortgaged Property: The underlying property, including any Additional
Collateral, securing a Mortgage Loan which, with respect to a Cooperative Loan,
is the related Cooperative Shares and Proprietary Lease.
Mortgage Rate: As to any Mortgage Loan, the annual rate of interest
borne by the related Mortgage Notes.
Mortgagor: The obligor on a Mortgage Note.
MSDWCC Serviced Mortgage Loan: Each Mortgage Loan originated and
serviced by Xxxxxx Xxxxxxx Xxxx Xxxxxx Credit Corporation and listed on the
Mortgage Loan Schedule.
MSDWCC Purchase Agreement: The Second Amended and Restated Master
Mortgage Loan Purchase Agreement listed in Exhibit E hereto between the Seller
and Xxxxxx Xxxxxxx Xxxx Xxxxxx Credit Corporation.
MSDWCC Purchase and Servicing Agreement: Collectively, the MSDWCC
Purchase Agreement and the MSDWCC Servicing Agreement.
MSDWCC Servicing Agreement: The Amended and Restated Master Servicing
Agreement listed in Exhibit E hereto between the Seller and Xxxxxx Xxxxxxx Xxxx
Xxxxxx Credit Corporation.
MSMCI Mortgage Loan: A Mortgage Loan sold by the Seller to the
Depositor pursuant to the MSMCI Purchase Agreement.
MSMCI Purchase Agreement: The Mortgage Loan Purchase Agreement listed
in Exhibit E hereto between the Seller and the Depositor.
National City Serviced Mortgage Loan: Each Mortgage Loan originated
and serviced by National City Mortgage Co. and listed on the Mortgage Loan
Schedule.
National City Servicing Agreement: The Mortgage Loan Sale Servicing
Agreement listed in Exhibit E hereto between the Seller and National City
Mortgage Co.
Net Liquidation Proceeds: With respect to any Liquidated Mortgage Loan
or any other disposition of related Mortgaged Property, the related Liquidation
Proceeds net of Advances, Servicer Advances, Servicing Fees and any other
accrued and unpaid servicing fees received and retained in connection with the
liquidation of such Mortgage Loan or Mortgaged Property.
23
Net Mortgage Rate: With respect to any Mortgage Loan and any
Distribution Date, the related Mortgage Rate as of the Due Date in the month
preceding the month of such Distribution Date reduced by the Aggregate Expense
Rate for such Mortgage Loan.
Net Prepayment Interest Shortfalls: As to any Distribution Date and
Loan Group, the amount by which the aggregate of Prepayment Interest Shortfalls
for such Loan Group exceeds the Compensating Interest Payments for such Loan
Group and that Distribution Date.
Net WAC Shortfall: With respect to any Class of LIBOR Certificates and
any Distribution Date on which the Pass-Through Rate for that Class of
Certificates is limited to the Group 1 Net WAC, an amount equal to the sum of
(i) the excess of (x) the amount of interest such Class of Certificates would
have been entitled to receive on such Distribution Date if the Group 1 Net WAC
had not been applicable to such Class on such Distribution Date, subject to a
maximum rate of 10.50% per annum over (y) the amount of interest accrued on such
Distribution Date at the Group 1 Net WAC plus (ii) the related Net WAC Shortfall
for the previous Distribution Date not previously distributed together with
interest thereon at a rate equal to the related Pass-Through Rate for such Class
of Certificates for the most recently ended Interest Accrual Period.
Non-Book-Entry Certificate: Any Certificate other than a Book-Entry
Certificate.
Non-Delay Certificates: As specified in the Preliminary Statement.
Non-permitted Foreign Holder: As defined in Section 3.03(f).
Non-U.S. Person: Any person other than a "United States person" within
the meaning of Section 7701(a)(30) of the Code.
Nonrecoverable Advance: Any portion of an Advance or Servicer Advance
previously made or proposed to be made by the Master Servicer and/or a Servicer
(as certified in an Officer's Certificate of such Servicer), which in the good
faith judgment of such party, shall not be ultimately recoverable by such party
from the related Mortgagor, related Liquidation Proceeds or otherwise.
Notional Amount: With respect to the Class 1-X-1 Certificates and any
Distribution Date to and including the Distribution Date in July 2007, an amount
equal to the lesser of (i) the Notional Amount set forth in the table below for
that Distribution Date and (ii) the aggregate Stated Principal Balance of the
Group 1 Mortgage Loans as of the end of the related Due Period. Commencing with
the Distribution Date in August 2007, the Notional Amount of the Class 1-X-1
Certificates will be zero.
Class 1-X-1 Notional Amount Schedule
Notional Notional
Distribution Date Amount ($) Distribution Date Amount ($)
---------------------------- ------------------- ---------------------------- --------------
January 2005 .......... $546,592,000 May 2006 .............. $221,255,305
February 2005 ......... 517,583,297 June 2006 ............. 209,342,207
March 2005 ............ 489,987,591 July 2006 ............. 198,037,047
April 2005 ............ 463,731,366 August 2006 ........... 187,309,546
May 2005 .............. 438,756,109 September 2006 ........ 177,130,914
24
June 2005 ............. 414,998,061 October 2006 .......... 167,473,785
July 2005 ............. 392,397,339 November 2006 ......... 158,312,146
August 2005 ........... 370,897,574 December 2006 ......... 149,621,212
September 2005 ........ 350,445,319 January 2007 .......... 141,377,386
October 2005 .......... 330,989,357 February 2007 ......... 133,558,423
November 2005 ......... 312,480,655 March 2007 ............ 126,143,064
December 2005 ......... 294,873,648 April 2007 ............ 119,111,099
January 2006 .......... 278,124,435 May 2007 .............. 112,443,314
February 2006 ......... 262,191,247 June 2007 ............. 106,121,445
March 2006 ............ 247,034,353 July 2007
April 2006 ............ 233,808,189 and thereafter ...... 0
The Notional Amount of the Class 1-X-2 Certificates and any
Distribution Date will be equal to the aggregate Class Principal Balance of the
Class 1-A-1, Class 1-A-2A and Class 1-A-2B Certificates immediately prior to
that Distribution Date.
The Notional Amount of the Class 1-X-B Certificates and any
Distribution Date, an amount equal to the aggregate Class Principal Balance of
the Class 1-B-1, Class 1-B-2 and Class 1-B-3 Certificates immediately prior to
that Distribution Date.
Notional Amount Certificates: As specified in the Preliminary
Statement.
Offered Certificates: As specified in the Preliminary Statement.
Offering Document: The Prospectus or the Memorandum, as applicable.
Officer's Certificate: A certificate signed by two Authorized Officers
of the Depositor or the Chairman of the Board, any Vice Chairman, the President,
any Vice President or any Assistant Vice President of the Master Servicer or the
Securities Administrator, and in each case delivered to the Trustee or the
Securities Administrator, as applicable.
Officer's Certificate of a Servicer: A certificate (i) signed by the
Chairman of the Board, the Vice Chairman of the Board, the President, a Managing
Director, a Vice President (however denominated), an Assistant Vice President,
the Treasurer, the Secretary, or one of the Assistant Treasurers or Assistant
Secretaries of a Servicer, or (ii) if provided for herein, signed by a Servicing
Officer, as the case may be, and delivered to the Trustee, the Securities
Administrator or the Master Servicer, as required hereby.
Opinion of Counsel: A written opinion of counsel, reasonably acceptable
in form and substance to the Trustee, the Securities Administrator or the Master
Servicer, as required hereby, and who may be in-house or outside counsel to the
Depositor, the Master Servicer, the Securities Administrator or the Trustee but
which must be Independent outside counsel with respect to any such opinion of
counsel concerning the transfer of any Residual Certificate or concerning
certain matters with respect to ERISA, or the taxation, or the federal income
tax status, of each REMIC.
Option One Servicing Agreement: The Servicing Agreement listed in
Exhibit E hereto between the Seller and Option One Mortgage Corporation.
Option One Serviced Mortgage Loan: Each Mortgage Loan serviced by
Option One Mortgage Corporation and listed on the Mortgage Loan Schedule.
25
Original Applicable Credit Support Percentage: With respect to each of
the following Classes of Subordinated Certificates in an Aggregate Certificate
Group, the corresponding percentage described below, as of the Closing Date:
26
Group 1
Subordinated Certificates
----------------------------------------------
Class 1-B-1...... 8.25%
Class 1-B-2...... 4.70%
Class 1-B-3...... 3.10%
Class 1-B-4...... 2.10%
Class 1-B-5...... 1.20%
Class 1-B-6...... 0.50%
Aggregate Group II
Subordinated Certificates
----------------------------------------------
Class B-1........ 6.75%
Class B-2........ 3.75%
Class B-3........ 2.50%
Class B-4........ 1.70%
Class B-5........ 0.90%
Class B-6........ 0.35%
Original Subordinate Principal Balance: For the Group 1 Certificates
and the Group 1 Mortgage Loans, the aggregate Class Principal Balance of the
Group 1 Subordinated Certificates as of the Closing Date. For the Aggregate
Group II Certificates and any related Loan Group, on or prior to the third
related Senior Termination Date, the Subordinated Portion for that Loan Group,
in each case as of the Cut-off Date or, if such date is after the third related
Senior Termination Date, the aggregate Class Principal Balance of the Aggregate
Group II Subordinated Certificates as of the Closing Date.
Originator: Any one of Bank of America, National Association, Xxxxxx
Xxxxxxx Xxxx Xxxxxx Credit Corporation, Cendant Mortgage Corporation,
GreenPoint Mortgage Funding, Inc., National City Mortgage Co., Quicken Loans,
Inc. or Wachovia Mortgage Corporation as applicable.
Overcollateralized Group: As defined in Section 5.08 hereof.
Pass-Through Rate: For any interest bearing Class of Certificates or
Component, the per annum rate set forth or calculated in the manner described in
the Preliminary Statement.
Paying Agent: Any paying agent appointed pursuant to Section 3.08. The
initial Paying Agent shall be the Securities Administrator under this Agreement.
Percentage Interest: As to any Certificate, the percentage interest
evidenced thereby in distributions required to be made on the related Class,
such percentage interest being set forth on the face thereof or equal to the
percentage obtained by dividing the initial principal balance or notional
amount, as applicable, of such Certificate by the aggregate of the Class
Principal Balance or Notional Amount, as applicable, of all Certificates of the
same Class.
27
Permitted Investments: At any time, any one or more of the following
obligations and securities:
(i) obligations of the United States or any agency thereof,
provided that such obligations are backed by the full faith and credit
of the United States;
(ii) general obligations of or obligations guaranteed by any
state of the United States or the District of Columbia receiving the
highest long-term debt rating of each Rating Agency, or such lower
rating as shall not result in the downgrading or withdrawal of the
ratings then assigned to the Certificates by the Rating Agencies, as
evidenced by a signed writing delivered by each Rating Agency;
(iii) commercial or finance company paper which is then
receiving the highest commercial or finance company paper rating of
each Rating Agency rating such paper, or such lower rating as shall not
result in the downgrading or withdrawal of the ratings then assigned to
the Certificates by the Rating Agencies, as evidenced by a signed
writing delivered by each Rating Agency;
(iv) certificates of deposit, demand or time deposits, or
bankers' acceptances issued by any depository institution or trust
company incorporated under the laws of the United States or of any
state thereof and subject to supervision and examination by federal
and/or state banking authorities, provided that the commercial paper
and/or long-term unsecured debt obligations of such depository
institution or trust company (or in the case of the principal
depository institution in a holding company system, the commercial
paper or long-term unsecured debt obligations of such holding company,
but only if Xxxxx'x is not the applicable Rating Agency) are then rated
one of the two highest long-term and the highest short-term ratings of
each Rating Agency for such securities, or such lower ratings as shall
not result in the downgrading or withdrawal of the ratings then
assigned to the Certificates by the Rating Agencies, as evidenced by a
signed writing delivered by each Rating Agency;
(v) demand or time deposits or certificates of deposit issued
by any bank or trust company or savings institution to the extent that
such deposits are fully insured by the FDIC;
(vi) guaranteed reinvestment agreements issued by any bank,
insurance company or other corporation acceptable to the Rating
Agencies at the time of the issuance of such agreements, as evidenced
by a signed writing delivered by each Rating Agency;
(vii) repurchase obligations with respect to any security
described in clauses (i) and (ii) above, in either case entered into
with a depository institution or trust company (acting as principal)
described in clause (iv) above;
(viii) securities (other than stripped bonds, stripped coupons
or instruments sold at a purchase price in excess of 115% of the face
amount thereof) bearing interest or sold at a discount issued by any
corporation incorporated under the laws of the United States or any
state thereof which, at the time of such investment, have one of the
two highest
28
ratings of each Rating Agency (except if the Rating Agency is
Moody's, such rating shall be the highest commercial paper rating of
Moody's for any such series), or such lower rating as shall not result
in the downgrading or withdrawal of the ratings then assigned to the
Certificates by the Rating Agencies, as evidenced by a signed writing
delivered by each Rating Agency;
(ix) interests in any money market fund which at the date of
acquisition of the interests in such fund and throughout the time such
interests are held in such fund has the highest applicable rating by
each Rating Agency rating such fund or such lower rating as shall not
result in a change in the rating then assigned to the Certificates by
each Rating Agency, as evidenced by a signed writing delivered by each
Rating Agency, including funds for which the Trustee, the Master
Servicer, the Securities Administrator or any of its Affiliates is
investment manager or adviser;
(x) short-term investment funds sponsored by any trust company
or national banking association incorporated under the laws of the
United States or any state thereof which on the date of acquisition has
been rated by each applicable Rating Agency in their respective highest
applicable rating category or such lower rating as shall not result in
a change in the rating then specified stated maturity and bearing
interest or sold at a discount acceptable to each Rating Agency as
shall not result in the downgrading or withdrawal of the ratings then
assigned to the Certificates by the Rating Agencies, as evidenced by a
signed writing delivered by each Rating Agency; and
(xi) such other investments having a specified stated maturity
and bearing interest or sold at a discount acceptable to the Rating
Agencies as shall not result in the downgrading or withdrawal of the
ratings then assigned to the Certificates by the Rating Agencies, as
evidenced by a signed writing delivered by each Rating Agency;
provided, that no such instrument shall be a Permitted Investment if (i) such
instrument evidences the right to receive interest only payments with respect to
the obligations underlying such instrument or (ii) such instrument would require
the Depositor to register as an investment company under the Investment Company
Act of 1940, as amended.
Person: Any individual, corporation, partnership, joint venture,
association, joint-stock company, limited liability company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
Plan Asset Regulations: The Department of Labor regulations set forth
in 29 C.F.R. 2510.3-101.
Planned Balance: With respect to any group of Planned Principal Classes
or Components in the aggregate and any Distribution Date appearing in Schedule B
hereto, the Aggregate Planned Balance for such group and Distribution Date. With
respect to any other Planned Principal Class or Component and any Distribution
Date appearing in Schedule B hereto, the applicable amount appearing opposite
such Distribution Date for such Class or Component.
Planned Principal Classes: As specified in the Preliminary Statement.
29
Prepayment Interest Shortfall: With respect to each Mortgage Loan, the
amount of the shortfall in interest payable on such Mortgage Loan that occurs as
a result of the prepayment by the related Mortgagor of such Mortgage Loan
calculated in accordance with formula set forth in the related Purchase and
Servicing Agreement.
Prepayment Penalty: As to a Mortgage Loan, any penalty payable by a
Mortgagor in connection with certain partial prepayments and all prepayments in
full made within the related Prepayment Penalty Period, the Prepayment Penalties
with respect to each applicable Mortgage Loan so held by the Trust Fund being
identified in the Prepayment Penalty Schedule.
Prepayment Penalty Period: As to any Mortgage Loan, the period of time
during which a Prepayment Penalty may be imposed.
Prepayment Penalty Schedule: As of any date, the list of Prepayment
Penalties included in the Trust Fund on that date (including the Prepayment
Penalty summary attached thereto). The Prepayment Penalty Schedule shall set
forth the following information with respect to each Prepayment Penalty:
o the Mortgage Loan account number;
o a code indicating the type of Prepayment Penalty;
o the state of origination in which the related Mortgage Property
is located;
o the first date on which a monthly payment is or was due under
the related Mortgage Note;
o the term of the Prepayment Penalty;
o the original principal amount of the related Mortgage Loan; and
o the Cut-off Date Principal Balance of the related Mortgage Loan.
The Prepayment Penalty Schedule shall be amended from time to time by
the Seller in accordance with this Agreement.
Prepayment Period: With respect to any Mortgage Loan (i) other than a
Cendant Serviced Mortgage Loan or an Option One Serviced Mortgage Loan and any
Distribution Date, the calendar month preceding that Distribution Date, and (ii)
for any Cendant Serviced Mortgage Loan, the second day of the calendar month
immediately preceding the month in which that Distribution Date occurs to and
including the first day of the calendar month in which that Distribution Date
occurs and (iii) for any Option One Serviced Mortgage Loan, the period from the
fifteenth day of the calendar month immediately preceding the month in which the
Distribution Date occurs (or in the case of the first Distribution Date, from
December 1, 2004) through the fourteenth day of the calendar month in which the
Distribution Date occurs.
Prepayment Shift Percentage: Not applicable.
30
Primary Mortgage Insurance Policy: Each policy of primary mortgage
guaranty insurance or any replacement policy therefor with respect to any
Mortgage Loan.
Principal Amount: As to any Distribution Date and Loan Group, the sum
of (a) the principal portion of each Scheduled Payment (without giving effect,
prior to the Bankruptcy Coverage Termination Date, to any reductions thereof
caused by any Debt Service Reductions or Deficient Valuations) due on each
Mortgage Loan in the related Loan Group on the related Due Date, (b) the Stated
Principal Balance of each Mortgage Loan in the related Loan Group that was
repurchased by the Seller or an Originator or purchased by the Master Servicer
pursuant to this Agreement as of such Distribution Date, (c) the Substitution
Adjustment Amount in connection with any Deleted Mortgage Loan in such Loan
Group received with respect to such Distribution Date, (d) any Insurance
Proceeds or Liquidation Proceeds allocable to recoveries of principal of
Mortgage Loans in the related Loan Group that are not yet Liquidated Mortgage
Loans received during the calendar month preceding the month of such
Distribution Date, (e) with respect to each Mortgage Loan in a Loan Group that
became a Liquidated Mortgage Loan during the calendar month preceding the month
of such Distribution Date, the amount of the Liquidation Proceeds allocable to
principal and, if such Liquidated Mortgage Loan is an Additional Collateral
Mortgage Loan, the proceeds of any Additional Collateral from the related
Additional Collateral Mortgage Loan, in each case received during the calendar
month preceding the month of such Distribution Date with respect to such
Mortgage Loan, (f) all Principal Prepayments for such Loan Group received during
the related Prepayment Period, (g) any Subsequent Recoveries for such Loan Group
received during the calendar month preceding the month of such Distribution Date
and (h) in the case of a Loan Group in Aggregate Loan Group II, any Transfer
Payments Received for such Loan Group and Distribution Date less, in the case of
a Loan Group in Aggregate Loan Group II, any Transfer Payments Made for such
Loan Group and Distribution Date.
Principal Prepayment: Any payment of principal by a Mortgagor on a
Mortgage Loan that is received in advance of its scheduled Due Date and is not
accompanied by an amount representing scheduled interest due on any date or
dates in any month or months subsequent to the month of prepayment.
Principal Prepayment in Full: Any Principal Prepayment made by a
Mortgagor of the entire principal balance of a Mortgage Loan.
Principal Reductions: For each Loan Group, the sum of the Principal
Amount and any Realized Losses.
Principal Relocation Payment: A payment from any Loan Group to a
Subsidiary REMIC Regular Interest other than a Regular Interest corresponding to
that Loan Group as provided in the Preliminary Statement. Principal Relocation
Payments shall be made of principal allocations comprising the Principal Amount
from a Loan Group and shall include a proportionate allocation of Realized
Losses from the Mortgage Loans of such Loan Group.
Priority Amount: Not applicable.
Priority Percentage: Not applicable.
31
Private Certificate: As specified in the Preliminary Statement.
Pro Rata Share: As to any Distribution Date, the Subordinated Principal
Distribution Amount for an Aggregate Loan Group and any related Class of
Subordinated Certificates, the portion of the related Subordinated Principal
Distribution Amount allocable to such Class, equal to the product of the related
Subordinated Principal Distribution Amount on such Distribution Date and a
fraction, the numerator of which is the related Class Principal Balance thereof
and the denominator of which is the aggregate of the Class Principal Balances of
the Group 1 Subordinated Certificates or Aggregate Group II Subordinated
Certificates, as applicable.
Pro Rata Subordinated Percentage: As to any Distribution Date and Loan
Group, 100% minus the related Senior Percentage for such Distribution Date.
Proceeding: Any suit in equity, action at law or other judicial or
administrative proceeding.
Proprietary Lease: With respect to any Cooperative Property, a lease
or occupancy agreement between a Cooperative Corporation and a holder of
related Cooperative Shares.
Prospectus: The prospectus supplement dated December 22, 2004, together
with the accompanying prospectus dated January 28, 2004, relating to the
Certificates.
Purchase and Servicing Agreements: Collectively, the mortgage loan
purchase and servicing agreements, each as amended by the related
Acknowledgement, listed in Exhibit E hereto, as each such agreement may be
amended or supplemented from time to time as permitted hereunder.
Purchase Date: As defined in Section 7.01(c).
Purchase Price: With respect to any Mortgage Loan required or permitted
to be purchased by the Seller or Depositor pursuant to this Agreement, or by the
related Originator or Servicer pursuant to the related Purchase and Servicing
Agreement, an amount equal to the sum of (i) 100% of the unpaid principal
balance of the Mortgage Loan on the date of such purchase and (ii) accrued
interest thereon at the applicable Net Mortgage Rate from the date through which
interest was last paid by the Mortgagor to the Due Date in the month in which
the Purchase Price is to be distributed to Certificateholders, or such other
amount as may be specified in the related Purchase and Servicing Agreement and
(iii) costs and damages incurred by the Trust Fund in connection with a
repurchase pursuant to Section 2.05 hereof that arises out of a violation of any
predatory or abusive lending law with respect to the related Mortgage Loan.
Quicken Mortgage Loan: Each Mortgage Loan originated by Quicken
Loans, Inc. and listed on the Mortgage Loan Schedule.
Quicken Purchase and Servicing Agreement: The Mortgage Loan Sale
Servicing Agreement listed in Exhibit E hereto between the Seller and Quicken
Loans, Inc.
Rating Agency: Each of the Rating Agencies specified in the Preliminary
Statement. If any such organization or a successor is no longer in existence,
"Rating Agency" shall be such
32
nationally recognized statistical rating organization, or other comparable
Person, as is designated by the Depositor, notice of which designation shall
be given to the Trustee. References herein to a given rating category of a
Rating Agency shall mean such rating category without giving effect to any
modifiers.
Realized Loss: With respect to each Liquidated Mortgage Loan, an amount
(not less than zero or more than the Stated Principal Balance of the related
Mortgage Loan) as of the date of such liquidation, equal to (i) the Stated
Principal Balance of the Liquidated Mortgage Loan as of the date of such
liquidation, plus (ii) interest at the Net Mortgage Rate from the Due Date as to
which interest was last paid or advanced (and not reimbursed) to
Certificateholders up to the Due Date in the month in which Liquidation Proceeds
are required to be distributed on the Stated Principal Balance of such
Liquidated Mortgage Loan from time to time, minus (iii) the Liquidation
Proceeds, if any, received during the month in which such liquidation occurred,
to the extent applied as recoveries of interest at the Net Mortgage Rate and to
principal of the Liquidated Mortgage Loan. With respect to each Mortgage Loan
which has become the subject of a Deficient Valuation, if the principal amount
due under the related Mortgage Note has been reduced, the difference between the
principal balance of the Mortgage Loan outstanding immediately prior to such
Deficient Valuation and the principal balance of the Mortgage Loan as reduced by
the Deficient Valuation. With respect to each Mortgage Loan which has become the
subject of a Debt Service Reduction and any Distribution Date, the amount, if
any, by which the principal portion of the related Scheduled Payment has been
reduced.
To the extent the Master Servicer or a Servicer receives Subsequent
Recoveries with respect to any Mortgage Loan, the amount of the Realized Loss
with respect to that Mortgage Loan will be reduced by such Subsequent
Recoveries.
Recognition Agreement: An agreement among a Cooperative Corporation, a
lender and a Mortgagor with respect to a Cooperative Loan whereby such parties
(i) acknowledge that such lender may make, or intends to make, such Cooperative
Loan, and (ii) make certain agreements with respect to such Cooperative Loan.
Record Date: As to any Distribution Date (i) with respect to the
Non-Delay Certificates, the last Business Day preceding such Distribution Date
(or the Closing Date, in the case of the first Distribution Date) unless such
Certificates shall no longer be Book-Entry Certificates, in which case the
Record Date shall be the last Business Day of the month preceding the month of
such Distribution Date and (ii) in the case of the Delay Certificates (including
the Non-Delay Certificates that are subsequently reissued as Definitive
Certificates), the last Business Day of the month preceding the month of each
Distribution Date.
Redemption Price: With respect to any Class of Certificates to be
redeemed, an amount equal to 100% of the related Class Principal Balance of the
Certificates to be so redeemed, together with interest on such amount at the
applicable Pass-Through Rate through the related Accrual Period (as increased by
any Class Unpaid Interest Amounts), and including, in the case of the Redemption
Price payable in connection with the redemption and retirement of all of the
Certificates, the payment of all amounts (including, without limitation, all
previously unreimbursed Advances and Servicer Advances and accrued and unpaid
Servicing Fees) payable or reimbursable to the Trustee, the Securities
Administrator, the Master Servicer and the
33
Servicers pursuant to this Agreement and the Purchase and Servicing
Agreements, or to the Custodian under the Custodian Agreements (to the extent
such amounts are not paid to the Custodian by the Seller).
Refinancing Mortgage Loan: Any Mortgage Loan originated in connection
with the refinancing of an existing mortgage loan.
Regular Certificates: As specified in the Preliminary Statement.
Relief Act: The Servicemembers Civil Relief Act (formerly known as the
Soldiers' and Sailors' Civil Relief Act of 1940), as amended, and any similar
state laws.
Relief Act Shortfalls: With respect to any Distribution Date and any
Mortgage Loan as to which there has been a reduction in the amount of interest
collectible thereon for the most recently ended calendar month as a result of
the application of the Relief Act, the amount, if any, by which (i) interest
collectible on such Mortgage Loan for the most recently ended calendar month is
less than (ii) interest accrued thereon for such month pursuant to the Mortgage
Note.
REMIC: Each pool of assets in the Trust Fund designated as a REMIC as
described in the Preliminary Statement.
REMIC Provisions: The provisions of the federal income tax law relating
to real estate mortgage investment conduits, which appear at Sections 860A
through 860G of the Code, and related provisions, and regulations, including
proposed regulations and rulings, and administrative pronouncements promulgated
thereunder, as the foregoing may be in effect from time to time.
REO Property: A Mortgaged Property acquired by the Trust Fund through
foreclosure or deed-in-lieu of foreclosure in connection with a defaulted
Mortgage Loan or otherwise treated as having been acquired pursuant to the REMIC
Provisions.
Replacement Mortgage Loan: A mortgage loan substituted by an Originator
or the Seller for a Deleted Mortgage Loan which must, on the date of such
substitution, as confirmed in a request for release, substantially in the form
attached to the related Custodial Agreement, (i) have a Stated Principal
Balance, after deduction of all Scheduled Payments due in the month of
substitution, not in excess of the Stated Principal Balance of the Deleted
Mortgage Loan, (ii) have a Mortgage Rate not less than (and not more than two
percentage points greater than) the mortgage rate of the Deleted Mortgage Loan,
(iii) have a Loan-to-Value Ratio equal to or less than that of the Deleted
Mortgage Loan, (iv) have a remaining term to maturity not greater than (and not
more than one year less than) that of the Deleted Mortgage Loan, (v) is
otherwise acceptable to the Seller, (vi) have the same adjustment date as that
of the Deleted Mortgage Loan, (vii) have a minimum Mortgage Rate not less than
that of the Deleted Mortgage Loan, (viii) have the same Index as that of the
Deleted Mortgage Loan, (ix) comply with all of the representations and
warranties set forth in the related underlying servicing agreement, as modified
by any related assignment thereof, and (x) shall be accompanied by an Opinion of
Counsel that such Replacement Mortgage Loan would not adversely affect the REMIC
status of any REMIC created hereunder or would not otherwise be prohibited by
this Pooling and Servicing Agreement.
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Required Reserve Fund Deposit: Each of the Class 1-X-1 Required Reserve
Fund Deposit, the Class 1-X-2 Required Reserve Fund Deposit and the Class 1-X-B
Required Reserve Fund Deposit.
Reserve Fund: A fund created as part of the Trust Fund pursuant to
Section 5.10 of this Agreement but which is not an asset of any of the REMICs
consisting of the Class 1-X-1 Sub Account, the Class 1-X-2 Sub Account and the
Class 1-X-B Sub Account.
Residual Certificate: The Class A-R Certificates.
Responsible Officer: With respect to the Trustee, any officer in the
corporate trust department or similar group of the Trustee with direct
responsibility for the administration of this Agreement and also, with respect
to a particular corporate trust matter, any other officer to whom such matter is
referred because of his or her knowledge of and familiarity with the particular
subject. With respect to the Master Servicer, any officer in its master
servicing operations with direct responsibility for the Administration of this
Agreement. With respect to the Securities Administrator, any officer in the
corporate trust department or similar group of the Securities Administrator with
direct responsibility for the administration of this Agreement and also, with
respect to a particular corporate trust matter, any other officer to whom such
matter is referred because of his or her knowledge of and familiarity with the
particular subject.
Restricted Classes: As defined in Section 5.02(e).
Restricted Global Security: As defined in Section 3.01(c).
SAIF: The Saving's Association Insurance Fund, or any successor
thereto.
S&P: Standard & Poor's, a division of The XxXxxx-Xxxx Companies, Inc.
If S&P is designated as a Rating Agency in the Preliminary Statement, for
purposes of Section 11.07 the address for notices to S&P shall be Standard &
Poor's, 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Mortgage
Surveillance Monitoring, or such other address as S&P may hereafter furnish to
the Depositor and the Master Servicer.
Scheduled Balances: Not applicable.
Scheduled Payment: The scheduled monthly payment on a Mortgage Loan due
on any Due Date allocable to principal and/or interest on such Mortgage Loan
which, unless otherwise specified in the related Purchase and Servicing
Agreement, shall give effect to any related Debt Service Reduction and any
Deficient Valuation that affects the amount of the monthly payment due on such
Mortgage Loan.
Scheduled Principal Classes: As specified in the Preliminary
Statement.
Scheduled Principal Distribution Amount: Not applicable.
Securities Administrator: Xxxxx Fargo Bank, National Association, not
in its individual capacity but solely as Securities Administrator, or any
successor in interest, or if any successor
35
Securities Administrator shall be appointed as herein provided, then such
successor Securities Administrator.
Securities Administrator Compensation: With respect to any Securities
Administrator that is a successor to Xxxxx Fargo Bank, National Association as
Securities Administrator, the portion of the earnings on the funds on deposit in
the Distribution Account payable on each Distribution Date pursuant to Section
4.02(b)(ii) hereof agreed to by and between such Securities Administrator and
the successor master servicer; provided, that (x) such Securities Administrator
Compensation payable on each Distribution Date shall equal at least one day's
earnings accrued since the prior Distribution Date and (y) the sum of such
Securities Administrator Compensation and the Master Servicer Compensation
payable on each Distribution Date shall not exceed the total earnings on the
funds on deposit in the Distribution Account payable on each Distribution Date
pursuant to Section 4.02(b)(ii) hereof earned since the prior Distribution Date.
Seller: Xxxxxx Xxxxxxx Mortgage Capital Inc., a New York corporation.
Senior Certificate Group: As specified in the Preliminary Statement.
Senior Certificates: As specified in the Preliminary Statement.
Senior Credit Support Depletion Date: With respect to the Group 1
Senior Certificates and the Aggregate Group II Senior Certificates, as
applicable, the date on which the aggregate Class Principal Balance of the Group
1 Subordinated Certificates or Aggregate Group II Subordinated Certificates,
respectively, have been reduced to zero.
Senior Percentage: As to any Senior Certificate Group and Distribution
Date, the percentage equivalent of a fraction the numerator of which is the
aggregate Class Principal Balance of each Class of Senior Certificates of such
Senior Certificate Group (other than the related Notional Amount Certificates)
immediately prior to such Distribution Date, and the denominator of which is the
aggregate Stated Principal Balance of each Mortgage Loan in the related Loan
Group as of the Due Date occurring in the month prior to the month of such
Distribution Date (after giving effect to prepayments received in the Prepayment
Period related to such prior Due Date); provided, however, that, with respect to
the Aggregate Group II Senior Certificates, on any Distribution Date after the
third related Senior Termination Date, the Senior Percentage for the Senior
Certificates of the related remaining Senior Certificate Group in Aggregate
Certificate Group II is the percentage equivalent of a fraction, the numerator
of which is the aggregate of the Class Principal Balances of each such Class of
Senior Certificates (other than the related Notional Amount Certificates) of
such remaining Senior Certificate Group immediately prior to such Distribution
Date, and the denominator of which is the aggregate of the Class Principal
Balances of all Classes of Aggregate Group II Certificates (other than the
related Notional Amount Certificates) immediately prior to such Distribution
Date. In no event will any Senior Percentage be greater than 100%.
Senior Prepayment Percentage: As to the Group 1 Senior Certificates and
any Distribution Date during the ten years beginning on the first Distribution
Date, 100%. The Senior Prepayment Percentage for any Distribution Date occurring
on or after the tenth anniversary of the first Distribution Date will, except as
provided herein, be as follows: for any
36
Distribution Date in the first year thereafter, the related Senior
Percentage plus 70% of the related Subordinated Percentage for such
Distribution Date; for any Distribution Date in the second year thereafter,
the related Senior Percentage plus 60% of the related Subordinated Percentage
for such Distribution Date; for any Distribution Date in the third year
thereafter, the related Senior Percentage plus 40% of the related Subordinated
Percentage for such Distribution Date; for any Distribution Date in the fourth
year thereafter, the related Senior Percentage plus 20% of the related
Subordinated Percentage for such Distribution Date; and for any Distribution
Date thereafter, the related Senior Percentage for such Distribution Date
(unless on any Distribution Date the related Senior Percentage exceeds the
Senior Percentage of such Senior Certificate Group as of the Closing Date, in
which case the Senior Prepayment Percentage for such Distribution Date will
once again equal 100%). Notwithstanding the foregoing, no decrease in any
Senior Prepayment Percentage related to Loan Group 1 will occur unless (i)
both of the Senior Step Down Conditions are satisfied with respect Loan Group
1 and (ii) if the Two Times Test is satisfied on a Distribution Date, (a) on
or before the Distribution Date in December 2007, the related Senior
Prepayment Percentage for Loan Group 1 will equal the related Senior
Percentage plus 50% of the Pro Rata Subordinated Percentage and (b) after the
Distribution Date in December 2007, the related Senior Prepayment Percentage
for Loan Group 1 will equal the related Senior Percentage.
As to the Aggregate Group II Senior Certificates and any Distribution
Date during the seven years beginning on the first Distribution Date, 100%. The
related Senior Prepayment Percentage for any Distribution Date occurring on or
after the seventh anniversary of the first Distribution Date will, except as
provided in this Agreement, be as follows: for any Distribution Date in the
first year thereafter, the related Senior Percentage plus 70% of the related
Subordinated Percentage for such Distribution Date; for any Distribution Date in
the second year thereafter, the related Senior Percentage plus 60% of the
related Subordinated Percentage for such Distribution Date; for any Distribution
Date in the third year thereafter, the related Senior Percentage plus 40% of the
related Subordinated Percentage for such Distribution Date; for any Distribution
Date in the fourth year thereafter, the related Senior Percentage plus 20% of
the related Subordinated Percentage for such Distribution Date; and for any
Distribution Date thereafter, the related Senior Percentage for such
Distribution Date (unless on any Distribution Date the related Senior Percentage
exceeds the Senior Percentage of such Senior Certificate Group as of the Closing
Date, in which case the related Senior Prepayment Percentage for such
Distribution Date will once again equal 100%). Notwithstanding the foregoing, no
decrease in any Senior Prepayment Percentage related to Aggregate Loan Group II
will occur unless both of the Senior Step Down Conditions are satisfied with
respect to each Loan Group in Aggregate Loan Group II. Notwithstanding the
foregoing, if the Two Times Test is satisfied with respect to the Aggregate
Group II Certificates on a Distribution Date (x) on or before the Distribution
Date in December 2007, the related Senior Prepayment Percentage for each Loan
Group in Aggregate Loan Group II will equal the related Senior Percentage for
that Distribution Date plus 50% of the amount equal to the related Pro Rata
Subordinated Percentage and (y) after the Distribution Date in December 2007,
the related Senior Prepayment Percentage for each Loan Group in Aggregate Loan
Group II will equal the related Senior Percentage.
Senior Principal Distribution Amount: As to any Distribution Date and
Senior Certificate Group, the sum of (i) the sum, not less than zero, of the
related Senior Percentage of all amounts described in clauses (a) through (d) of
the definition of Principal Amount with respect to the
37
related Loan Group for such Distribution Date, (ii) with respect to any
Mortgage Loan in the related Loan Group that became a Liquidated Mortgage Loan
during the calendar month preceding the month of such Distribution Date, the
lesser of (x) the related Senior Percentage of the Stated Principal Balance of
such Mortgage Loan and (y) either (A) the related Senior Prepayment Percentage
of the amount of the Liquidation Proceeds allocable to principal received on
the Mortgage Loan, or (B) if an Excess Loss was sustained with respect to such
Liquidated Mortgage Loan during such prior calendar month, the related Senior
Percentage, of the amount of the Liquidation Proceeds allocable to principal
received with respect to such Mortgage Loan, and (iii) the sum of (x) the
related Senior Prepayment Percentage of the amounts described in clause (f) of
the definition of Principal Amount with respect to the related Loan Group for
such Distribution Date plus (y) the related Senior Prepayment Percentage of
any Subsequent Recoveries described in clause (g) of the definition of
Principal Amount for such Distribution Date; provided, however, that if a
Bankruptcy Loss that is an Excess Loss is sustained on a Mortgage Loan in the
related Loan Group that is not a Liquidated Mortgage Loan, the Senior
Principal Distribution Amount will be reduced on the related Distribution Date
by the related Senior Percentage of the principal portion of such Bankruptcy
Loss; provided further, however, on any Distribution Date after the third
related Senior Termination Date, in the case of the Aggregate Group II
Certificates, the Senior Principal Distribution Amount for the remaining
Senior Certificate Group in Aggregate Certificate Group II will be calculated
pursuant to the above formula based on all the Mortgage Loans in Aggregate
Loan Group II, as opposed to only the Mortgage Loans in the related Loan Group
and, if such Distribution Date is after a related Senior Termination Date,
shall be reduced by the amount of the principal distribution made pursuant to
(a) if the Group 1 Senior Certificates are reduced to zero on such date,
Section 5.02(a)(1)(iv)(y), (b) if the Group 2 Senior Certificates are reduced
to zero on such date, Section 5.02(a)(2)(iv)(y), (c) if the Group 3 Senior
Certificates are reduced to zero on such date, Section 5.02(a)(3)(iv)(y), (d)
if the Group 4 Senior Certificates are reduced to zero on such date, Section
5.02(a)(4)(iv)(y) or (e) if the Group 5 Senior Certificates are reduced to
zero on such date, Section 5.02(a)(5)(iv)(y).
Senior Step Down Conditions: With respect to Loan Group 1: (i) the
outstanding principal balance of all Mortgage Loans in Loan Group 1 delinquent
60 days or more (including any related Mortgage Loans in foreclosure, REO
Property and Mortgage Loans the mortgagors of which are in bankruptcy) (averaged
over the preceding six month period), as a percentage of the aggregate Class
Principal Balance of the Group 1 Subordinated Certificates, does not equal or
exceed 50%, and (ii) cumulative Realized Losses on the Mortgage Loans in Loan
Group 1 do not exceed: (a) commencing with the Distribution Date on the tenth
anniversary of the first Distribution Date, 30% of the Original Subordinate
Principal Balance, (b) commencing with the Distribution Date on the eleventh
anniversary of the first Distribution Date, 35% of the Original Subordinate
Principal Balance, (c) commencing with the Distribution Date on the twelfth
anniversary of the first Distribution Date, 40% of the Original Subordinate
Principal Balance, (d) commencing with the Distribution Date on the thirteenth
anniversary of the first Distribution Date, 45% of the Original Subordinate
Principal Balance, and (e) commencing with the Distribution Date on the
fourteenth anniversary of the first Distribution Date, 50% of the Original
Subordinate Principal Balance.
With respect to each Loan Group in Aggregate Loan Group II: (i) the
outstanding principal balance of all Mortgage Loans in a Loan Group in Aggregate
Loan Group II delinquent
38
60 days or more (including any related Mortgage Loans in foreclosure, REO
Property and Mortgage Loans the Mortgagors of which are in bankruptcy)
(averaged over the preceding six month period), as a percentage of (a) if such
date is on or prior to the third related Senior Termination Date, the
Subordinated Percentage for such Loan Group of the aggregate Stated Principal
Balances of the Mortgage Loans in that Loan Group, or (b) if such date is
after the third related Senior Termination Date, the aggregate Class Principal
Balance of the Group 1 Subordinated Certificates for such Distribution Date
does not equal or exceed 50%, and (ii) cumulative Realized Losses on all the
Mortgage Loans in Aggregate Loan Group II do not exceed: (a) commencing with
the Distribution Date on the seventh anniversary of the first Distribution
Date, 30% of the related Original Subordinate Principal Balance, (b)
commencing with the Distribution Date on the eighth anniversary of the first
Distribution Date, 35% of the related Original Subordinate Principal Balance,
(c) commencing with the Distribution Date on the ninth anniversary of the
first Distribution Date, 40% of the related Original Subordinate Principal
Balance, (d) commencing with the Distribution Date on the tenth anniversary of
the first Distribution Date, 45% of the related Original Subordinate Principal
Balance and (e) commencing with the Distribution Date on the eleventh
anniversary of the first Distribution Date, 50% of the related Original
Subordinate Principal Balance.
Senior Termination Date: For each Senior Certificate Group, the
Distribution Date on which the aggregate Class Principal Balance of the Senior
Certificates in that Senior Certificate Group has been reduced to zero.
Servicer: Each Servicer under a Purchase and Servicing Agreement, and
its respective successors and assigns.
Servicer Advance: A "Servicer Advance" or "Servicing Advance" as
defined in the applicable Purchase and Servicing Agreement.
Servicing Fee: As to any Distribution Date and each Mortgage Loan, an
amount equal to the product of (a) one-twelfth of the related Servicing Fee Rate
and (b) the Stated Principal Balance of such Mortgage Loan as of the first day
of the related Due Period.
Servicing Fee Rate: With respect to each Mortgage Loan and any
Distribution Date, the per annum rate specified in the related Purchase and
Servicing Agreement.
Servicing Officer: Any officer of the related Servicer involved in, or
responsible for, the administration and servicing of the related Mortgage Loans
whose name and facsimile signature appear on a list of servicing officers
furnished to the Master Servicer by the related Servicer on the Closing Date
pursuant to the related Purchase and Servicing Agreement, as such list may from
time to time be amended.
Shift Percentage: Not applicable.
Special Hazard Coverage Termination Date: With respect to each
Aggregate Certificate Group the point in time at which the related Special
Hazard Loss Coverage Amount is reduced to zero.
39
Special Hazard Loss: Any Realized Loss suffered by a Mortgaged Property
on account of direct physical loss, as reported by the related Servicer to the
Master Servicer, but not including (i) any loss of a type covered by a hazard
insurance policy or a flood insurance policy required to be maintained with
respect to such Mortgaged Property to the extent of the amount of such loss
covered thereby, or (ii) any loss caused by or resulting from:
(a) normal wear and tear;
(b) fraud, conversion or other dishonest act on the part of the
Trustee, the Master Servicer or any of their agents or employees
(without regard to any portion of the loss not covered by any errors
and omissions policy);
(c) errors in design, faulty workmanship or faulty materials,
unless the collapse of the property or a part thereof ensues and
then only for the ensuing loss;
(d) nuclear or chemical reaction or nuclear radiation or
radioactive or chemical contamination, all whether controlled or
uncontrolled, and whether such loss be direct or indirect, proximate
or remote or be in whole or in part caused by, contributed to or
aggravated by a peril covered by the definition of the term "Special
Hazard Loss;"
(e) hostile or warlike action in time of peace and war,
including action in hindering, combating or defending against an
actual, impending or expected attack:
1. by any government or sovereign power, de jure or
de facto, or by any authority maintaining or using military,
naval or air forces; or
2. by military, naval or air forces; or
3. by an agent of any such government, power,
authority or forces;
(f) any weapon of war employing nuclear fission, fusion or
other radioactive force, whether in time of peace or war; or
(g) insurrection, rebellion, revolution, civil war, usurped
power or action taken by governmental authority in hindering,
combating or defending against such an occurrence, seizure or
destruction under quarantine or customs regulations, confiscation by
order of any government or public authority or risks of contraband
or illegal transportation or trade.
Special Hazard Loss Coverage Amount: With respect to the first
Distribution Date and (a) the Group 1 Certificates, $7,000,000, and (b) the
Aggregate Group II Certificates, $5,705,922. With respect to any Distribution
Date after the first Distribution Date, the lesser of (a) the greatest of (i) 1%
of the aggregate of the principal balances of the Mortgage Loans in the
applicable Aggregate Loan Group, (ii) twice the principal balance of the largest
Mortgage Loan in the applicable Aggregate Loan Group and (iii) the aggregate of
the principal balances of all Mortgage Loans in the applicable Aggregate Loan
Group secured by Mortgaged Properties located in the single California postal
zip code area having the highest aggregate principal balance of any such zip
code area and (b) the related Special Hazard Loss Coverage Amount as
40
of the Closing Date less the amount, if any, of Special Hazard Losses
allocated to the Certificates in the related Aggregate Certificate Group since
the Closing Date. All principal balances for the purpose of this definition
will be calculated as of the first day of the calendar month preceding the
month of such Distribution Date after giving effect to Scheduled Payments on
the Mortgage Loans then due, whether or not paid.
Special Hazard Mortgage Loan: A Liquidated Mortgage Loan as to which a
Special Hazard Loss has occurred.
Startup Day: The day designated as such pursuant to Section 10.01(b)
hereof.
Stated Principal Balance: As to any Mortgage Loan and Due Date, the
unpaid principal balance of such Mortgage Loan as of such Due Date as specified
in the amortization schedule at the time relating thereto (before any adjustment
to such amortization schedule by reason of any moratorium or similar waiver or
grace period) after giving effect to any previous partial Principal Prepayments
and Liquidation Proceeds allocable to principal (other than with respect to any
Liquidated Mortgage Loan) and to the payment of principal due on such Due Date
and irrespective of any delinquency in payment by the related Mortgagor.
Sub Account: Each of the Class 1-X-1 Sub Account, the Class 1-X-2 Sub
Account and the Class 1-X-B Sub Account, constituting the Reserve Fund.
Subordinated Certificates: As specified in the Preliminary Statement.
Subordinated Percentage: As to any Distribution Date on or prior to a
related Senior Termination Date, in the case of the Group 1 Certificates or
after the third related Senior Termination Date, in the case of the Aggregate
Group II Certificates, and the portion of (x) the Group 1 Subordinated
Certificates relating to Loan Group 1 and (y) the Aggregate Group II
Subordinated Certificates relating to Loan Group 2, Loan Group 3, Loan Group 4
or Loan Group 5, as applicable, in each case, 100% minus the Senior Percentage
for the Senior Certificate Group relating to such Loan Group for such
Distribution Date. As to any Distribution Date after the third Senior
Termination Date and the entire interest of (x) the Group 1 Subordinated
Certificates in Group 1 and (y) the Aggregate Group II Subordinated Certificates
in Aggregate Group II, 100% minus the Senior Percentage for the Group 1 Senior
Certificates and Aggregate Group II Senior Certificates, respectively, for such
Distribution Date.
Subordinated Portion: For any Distribution Date, an amount equal to the
aggregate Stated Principal Balance of the Mortgage Loans in the related Loan
Group in Aggregate Loan Group II as of the end of the Prepayment Period related
to the immediately preceding Distribution Date, minus the aggregate Class
Principal Balance of the Senior Certificates in the related Senior Certificate
Group in Aggregate Certificate Group II immediately prior to such Distribution
Date.
Subordinated Prepayment Percentage: As to any Distribution Date and
Loan Group, 100% minus the related Senior Prepayment Percentage for such
Distribution Date.
Subordinated Principal Distribution Amount: With respect to any
Distribution Date and the Group 1 Subordinated Certificates, the sum of the
following amounts for Loan Group 1: an
41
amount equal to the sum of (i) the Subordinated Percentage for Loan Group 1 of
all amounts described in clauses (a) through (d) of the definition of
"Principal Amount" for Loan Group 1 and that Distribution Date, (ii) with
respect to each Mortgage Loan in Loan Group 1 that became a Liquidated
Mortgage Loan during the calendar month preceding the month of such
Distribution Date, the amount of the Liquidation Proceeds allocated to
principal received with respect thereto remaining after application thereof
pursuant to clause (ii) of the definition of "Senior Principal Distribution
Amount", up to the Subordinated Percentage for Loan Group 1 of the Stated
Principal Balance of that Mortgage Loan, and (iii) the sum of the Subordinated
Prepayment Percentage for Loan Group 1 of all amounts described in clause (f)
of the definition of "Principal Amount" for Loan Group 1 and Distribution
Date, and (iv) the Subordinated Prepayment Percentage of any Subsequent
Recoveries described in clause (g) of the definition of Principal Amount for
such Distribution Date.
With respect to any Distribution Date and the Aggregate Group
II Subordinated Certificates, the sum of the following amounts for each Loan
Group in Aggregate Loan Group II, an amount equal to the excess of (A) the sum
of (i) the Subordinated Percentage for such Loan Group of all amounts described
in clauses (a) through (d) of the definition of "Principal Amount" for that Loan
Group and that Distribution Date, (ii) with respect to each Mortgage Loan in
that Loan Group that became a Liquidated Mortgage Loan during the calendar month
preceding the month of such Distribution Date, the amount of the Liquidation
Proceeds allocated to principal received with respect thereto remaining after
application thereof pursuant to clause (ii) of the definition of "Senior
Principal Distribution Amount", up to the Subordinated Percentage for such Loan
Group of the Stated Principal Balance of that Mortgage Loan, and (iii) the sum
of the Subordinated Prepayment Percentage for that Loan Group of all amounts
described in clause (f) of the definition of "Principal Amount" for such Loan
Group and Distribution Date," and (iv) the Subordinated Prepayment Percentage of
any Subsequent Recoveries described in clause (g) of the definition of Principal
Amount for such Distribution Date over (B) any Transfer Payments Made for such
Loan Group; provided, however, that on any Distribution Date after the third
related Senior Termination Date, the Subordinated Principal Distribution Amount
will not be calculated by Loan Group but will equal the amount calculated
pursuant to the formula set forth above based on the applicable Subordinated
Percentage and Subordinated Prepayment Percentage for the Aggregate Group II
Subordinated Certificates for such Distribution Date with respect to all of the
Mortgage Loans in Aggregate Loan Group II as opposed to the Mortgage Loans only
in the related Loan Group.
Subsequent Recoveries: As to any Distribution Date, with respect to a
Liquidated Mortgage Loan that resulted in a Realized Loss in a prior calendar
month, amounts received by the Securities Administrator from the related
Servicer (net of any related expenses permitted to be reimbursed pursuant to
Section 4.02) specifically related to such Liquidated Mortgage Loan.
Subsidiary REMIC 1: As specified in the Preliminary Statement.
Subsidiary REMIC 1 Interest: As specified in the Preliminary
Statement.
Subsidiary REMIC 1 Regular Interest: As specified in the Preliminary
Statement.
Subsidiary REMIC 2: As specified in the Preliminary Statement.
42
Subsidiary REMIC 2 Interest: As specified in the Preliminary
Statement.
Subsidiary REMIC 2 Regular Interest: As specified in the Preliminary
Statement.
Substitution Adjustment Amount: As defined in the second paragraph of
Section 2.05(b).
Targeted Balance: With respect to any group of Targeted Principal
Classes or Components in the aggregate and any Distribution Date appearing in
Schedule B hereto, the Aggregate Targeted Balance for such group and
Distribution Date. With respect to any other Targeted Principal Class or
Component and any Distribution Date appearing in Schedule B hereto, the
applicable amount appearing opposite such Distribution Date for such Class or
Component.
Tax Matters Person: The person designated as "tax matters person" in
the manner provided under Treasury regulation ss. 1.860F-4(d) and temporary
Treasury regulation ss.301.6231(a)(7)1T. Initially, the Tax Matters Person shall
be the Securities Administrator.
Tax Matters Person Certificate: The Class A-R Certificate with a
Denomination of $0.01.
Transfer Payment: Either or both of a Transfer Payment Made or a
Transfer Payment Received.
Transfer Payment Made: As defined in Section 5.08.
Transfer Payment Received: As defined in Section 5.08.
Trust Fund: The corpus of the trust created pursuant to this Agreement
consisting of (i) the Mortgage Loans and all interest and principal received on
or with respect thereto after the Cut-off Date (other than Scheduled Payments
due on or prior to the Cut-off Date) to the extent not applied in computing the
Cut-off Date Principal Balance thereof; (ii) all cash, instruments or property
held or required to be held in the Custodial Accounts and the Distribution
Account and all amounts deposited therein pursuant to the applicable provisions
of this Agreement; (iii) property that secured a Mortgage Loan and has been
acquired by foreclosure, deed-in-lieu of foreclosure or otherwise; (iv) the
Depositor's rights assigned to the Trustee under the Purchase and Servicing
Agreements, as modified by the Acknowledgements and the Custodial Agreements;
(v) the pledge, control and guaranty agreements and the Limited Purpose Surety
Bond relating to the Additional Collateral Mortgage Loans; (vi) the Corridor
Contracts and the amounts on deposit in the Reserve Fund; and (v) all proceeds
of the conversion, voluntary or involuntary, of any of the foregoing.
Trustee: Deutsche Bank National Trust Company, a national banking
association, organized under the laws of the United States and any Person
succeeding the Trustee hereunder, or if any successor trustee or any co-trustee
shall be appointed as herein provided, then such successor trustee and such
co-trustee, as the case may be.
Trustee Mortgage Files: With respect to each Mortgage Loan, the
Mortgage Documents to be retained in the custody and possession of the Trustee
or Custodian on behalf of the Trustee.
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Two Times Test: As to any Distribution Date and the Group 1
Subordinated Certificates, if (i) the Aggregate Subordinated Percentage for the
Group 1 Subordinated Certificates is at least 200% of the related Aggregate
Subordinated Percentage as of the Closing Date, (ii) the outstanding aggregate
Stated Principal Balance of all Mortgage Loans in Loan Group 1 delinquent 60
days or more (averaged over the preceding six month period), as a percentage of
the aggregate Class Principal Balance of the Group 1 Subordinated Certificates,
does not equal or exceed 50% and (ii) the cumulative Realized Losses on all the
Mortgage Loans in Loan Group 1 do not exceed (x) with respect to any
Distribution Date on or prior to December 2007, 20% of the related Original
Subordinate Principal Balance or (y) with respect to any Distribution Date after
December 2007, 30% of the related Original Subordinate Principal Balance.
As to any Distribution Date and the Aggregate Group II
Subordinated Certificates, if (i) the Aggregate Subordinated Percentage for the
Aggregate Group II Subordinated Certificates is at least 200% of the related
Aggregate Subordinated Percentage as of the Closing Date, (ii) the outstanding
aggregate Stated Principal Balance of all Mortgage Loans in Aggregate Loan Group
II delinquent 60 days or more (averaged over the preceding six month period), as
a percentage of the aggregate Class Principal Balance of the Aggregate Group II
Subordinated Certificates, does not equal or exceed 50% and (ii) the cumulative
Realized Losses on all the Mortgage Loans in Aggregate Loan Group II do not
exceed (x) with respect to any Distribution Date on or prior to December 2007,
20% of the related Original Subordinate Principal Balance or (y) with respect to
any Distribution Date after December 2007, 30% of the related Original
Subordinate Principal Balance.
UCC: The Uniform Commercial Code as enacted in the relevant
jurisdiction.
Undercollateralized Group: As defined in Section 5.08 hereof.
Underwriter's Exemption: Prohibited Transaction Exemption 2002-41, 67
Fed. Reg. 54487 (2002), as amended (or any successor thereto), or any
substantially similar administrative exemption granted by the U.S. Department
of Labor.
Underwriter: As specified in the Preliminary Statement.
Unscheduled Principal Distribution Amount: Not applicable.
Uniform Commercial Code: The Uniform Commercial Code as in effect in
any applicable jurisdiction from time to time.
Voting Interests: The portion of the voting rights of all the
Certificates that is allocated to any Certificate for purposes of the voting
provisions of this Agreement. At all times during the term of this Agreement,
1.00% of all Voting Interests shall be allocated to each Class of Notional
Amount Certificates and the Class A-R Certificates. Voting Interests shall be
allocated among all other Classes of Certificates pro rata based on Class
Principal Balances for each Class then outstanding. Voting Interests shall be
allocated among the Certificates within each such Class in proportion to their
Certificate Balances or Percentage Interests.
Wachovia Serviced Mortgage Loan: Each Mortgage Loan originated and
serviced by Wachovia Mortgage Corporation and listed on the Mortgage Loan
Schedule.
44
Wachovia Purchase and Servicing Agreement: The Seller's Purchase,
Warranties and Servicing Agreement listed in Exhibit E hereto between the Seller
and Wachovia Mortgage Corporation.
Weighted Average Net Mortgage Rate: As to any Distribution Date and
Loan Group, the average of the Net Mortgage Rate of each Mortgage Loan in that
Loan Group, weighted on the basis of its Stated Principal Balance as of the
end of the Prepayment Period related to the immediately preceding Distribution
Date.
45
ARTICLE II
DECLARATION OF TRUST;
ISSUANCE OF CERTIFICATES
Section 2.01 Creation and Declaration of Trust Fund; Conveyance of
Mortgage Loans.
(a) Concurrently with the execution and delivery of this Agreement,
the Depositor does hereby transfer, assign, set over, deposit with and
otherwise convey to the Trustee, without recourse, subject to Sections 2.02
and 2.05, in trust, all the right, title and interest of the Depositor in and
to the Trust Fund. Such conveyance includes, without limitation, (i) the
Mortgage Loans, including the right to all payments of principal and interest
received on or with respect to the Mortgage Loans on and after the Cut-off
Date (other than Scheduled Payments due on or before such date), and all such
payments due after such date but received prior to such date and intended by
the related Mortgagors to be applied after such date; (ii) all of the
Depositor's right, title and interest in and to all amounts from time to time
credited to and the proceeds of the Distribution Account, any Custodial
Accounts or any Escrow Account established with respect to the Mortgage Loans;
(iii) all of the rights of the Depositor as assignee of the Seller with
respect to the Seller's rights under the Purchase and Servicing Agreements
pursuant to the Acknowledgements; (iv) all of the Depositor's right, title or
interest in REO Property and the proceeds thereof; (v) all of the Depositor's
rights under any Insurance Policies related to the Mortgage Loans; (vi) $200
(which amount has been delivered by the Depositor to the Securities
Administrator to be held in the Distribution Account until distributed to the
Holders of the Class P Certificates pursuant to Section 5.02(a)); and (vii) if
applicable, the Depositor's security interest in any collateral pledged to
secure the Mortgage Loans, including the Mortgaged Properties and any
Additional Collateral relating to the Additional Collateral Mortgage Loans,
including, but not limited to, the pledge, control and guaranty agreements and
the Limited Purpose Surety Bond, to have and to hold, in trust; and the
Trustee declares that, subject to the review provided for in Section 2.02, it
has received and shall hold the Trust Fund, as trustee, in trust, for the
benefit and use of the Holders of the Certificates and for the purposes and
subject to the terms and conditions set forth in this Agreement, and,
concurrently with such receipt, has caused to be executed, authenticated and
delivered to or upon the order of the Depositor, in exchange for the Trust
Fund, Certificates in the authorized denominations evidencing the entire
ownership of the Trust Fund.
The foregoing sale, transfer, assignment, set-over, deposit and
conveyance does not and is not intended to result in the creation or assumption
by the Trustee of any obligation of the Depositor, the Seller or any other
Person in connection with the Mortgage Loans or any other agreement or
instrument relating thereto except as specifically set forth therein.
In connection with such transfer and assignment of the Mortgage Loans,
the Custodian acting on the Trustee's behalf will continue to hold the documents
or instruments listed below with respect to each Mortgage Loan (each, a "Trustee
Mortgage File") so transferred and assigned.
46
On the Closing Date, each Custodian shall deliver to the Trustee and
the Depositor certification (each, a "Custodian Certification") in the form
attached hereto as Exhibit L certifying that, pursuant to each related Custodial
Agreement, the applicable Originator delivered and released to such Custodian,
subject to and in accordance with the relevant section of each related Purchase
and Servicing Agreement, the documents identified in the relevant section of
such Purchase and Servicing Agreement as being required to be delivered to the
Seller as Purchaser, pertaining to the Mortgage Loans as identified in the
related Mortgage Loan Schedule (provided, however, that the Custodian shall not
be required nor does it intend to re-examine the contents of the Trustee
Mortgage File for any of the Mortgage Loans in connection with entering into
this Agreement or providing the Custodian Certification required pursuant to
this Section 2.01):
(i) with respect to each Mortgage Loan, the original Mortgage Note
endorsed without recourse in proper form to the order of the Trustee, or in
blank (in each case, with all necessary intervening endorsements, as
applicable);
(ii) with respect to each Mortgage Loan (other than a Cooperative Loan)
that is not a MERS Mortgage Loan, the original Mortgage with evidence of
recording thereon, or if the original Mortgage has not yet been returned from
the recording office, a copy of such Mortgage certified by the applicable
Originator, title company, escrow agent or closing attorney to be a true copy of
the original of the Mortgage which has been sent for recording in the
appropriate jurisdiction in which the Mortgaged Property is located, and in the
case of the each MERS Mortgage Loan, the original Mortgage, noting the presence
of the MIN of the Mortgage Loans and either language indicating that the
Mortgage Loan is a MOM Loan if the Mortgage Loan is a MOM Loan or if the
Mortgage Loan was not a MOM Loan at origination, the original Mortgage and the
assignment thereof to MERS, with evidence of recording indicated thereon;
(iii) with respect to each Mortgage Loan (other than a Cooperative
Loan) that is not a MERS Mortgage Loan, the Assignment of Mortgage in form and
substance acceptable for recording in the relevant jurisdiction, such assignment
being either (A) in blank, without recourse, or (B) endorsed to "Deutsche Bank
National Trust Company, as Trustee of Xxxxxx Xxxxxxx Mortgage Loan Trust
2004-11AR, Mortgage Pass-Through Certificates, without recourse";
(iv) with respect to each Mortgage Loan (other than a Cooperative Loan)
that is not a MERS Mortgage Loan, the originals of all intervening assignments
of the Mortgage, if any, with evidence of recording thereon, or if the original
intervening assignment has not yet been returned from the recording office, a
copy of such assignment certified by the applicable Originator, title company,
escrow agent or closing attorney to be a true copy of the original of the
assignment which has been sent for recording in the appropriate jurisdiction in
which the Mortgaged Property is located;
(v) with respect to each Mortgage Loan (other than a Cooperative Loan),
the originals of all assumption, modification, consolidation or extension
agreements, if any, with evidence of recording thereon;
47
(vi) if any, with respect to each Mortgage Loan (other than a
Cooperative Loan), the original policy of title insurance (or a true copy
thereof) with respect to any such Mortgage Loan, or, if such policy has not yet
been delivered by the insurer, the title commitment or title binder to issue
same;
(vii) if any, with respect to each Mortgage Loan (other than a
Cooperative Loan), the original power of attorney and guaranty agreement with
respect to such Mortgage Loan;
(viii) [reserved];
(ix) with respect to each Mortgage Loan which constitutes a Cooperative
Loan:
(a) the original of any security agreement or similar document executed
in connection with the Cooperative Loan;
(b) the original Recognition Agreement and the original Assignment of
Recognition Agreement;
(c) UCC-1 financing statements with recording information thereon from
the appropriate governmental recording offices if necessary to perfect the
security interest of the Cooperative Loan under the Uniform Commercial Code in
the jurisdiction in which the Cooperative Property is located, accompanied by
UCC-3 financing statements executed in blank for recordation of the change in
the secured party thereunder;
(d) an Estoppel Letter and/or Consent;
(e) a search for (i) federal tax liens, mechanics' liens, lis pendens,
judgments of record or otherwise against (x) the Cooperative Corporation and (y)
the seller of the Cooperative Unit, (ii) filings of financing statements and
(iii) the deed of the cooperative project into the Cooperative Corporation;
(f) the guaranty of the Mortgage Note and Cooperative Loan, if any;
(g) the original Proprietary Lease and the Assignment of Proprietary
Lease executed by the Mortgagor in blank or if the Proprietary Lease has been
assigned by the Mortgagor to the Seller, then the Seller must execute an
assignment of the Assignment of Proprietary Lease in blank; and
(h) if any, the original or certified copy of the certificates
evidencing ownership of the Cooperative Shares issued by the Cooperative
Corporation and related assignment of such certificates or an assignment of such
Cooperative Shares, in blank, executed by the Mortgagor with such signature
guaranteed;
(x) [reserved]; and
(xi) any other document or instruments required to be delivered under
the related Custodial Agreement.
48
In addition, in connection with the assignment of any MERS Mortgage
Loan, it is understood that the related Originator will cause the MERS(R) System
to indicate that such Mortgage Loans have been assigned by the related
Originator to the Trustee in accordance with this Agreement for the benefit of
the Certificateholders by including (or deleting, in the case of Mortgage Loans
which are repurchased in accordance with this Agreement) in such computer files
the information required by the MERS(R) System to identify the series of
Certificates issued in connection with such Mortgage Loans. It is further
understood that the related Originator will not, and the Master Servicer hereby
agrees that it will not alter the information referenced in this paragraph with
respect to any Mortgage Loan during the term of this Agreement unless and until
such Mortgage Loan is repurchased in accordance with the terms of this
Agreement.
(b) As soon as is practicable after the Closing Date, the Depositor
shall cause the Servicer of any Additional Collateral Mortgage Loan to deliver
to the applicable Custodian the Assignment and Notice of Transfer with respect
to each Additional Collateral Mortgage Loan as well as the assignments of any
rights with respect to each Additional Collateral Mortgage Loan under any
Limited Purpose Surety Bond.
(c) In instances where a title insurance policy is required to be
delivered to the applicable Custodian on behalf of the Trustee and is not so
delivered, the Depositor will provide a copy of such title insurance policy to
the applicable Custodian on behalf of the Trustee, as promptly as practicable
after the execution and delivery hereof, but in any case within 180 days of
the Closing Date.
(d) For Mortgage Loans (if any) that have been prepaid in full after
the Cut-off Date and prior to the Closing Date, the Depositor, in lieu of
delivering the above documents, herewith delivers such amount to the
Securities Administrator, and delivers to the Securities Administrator, the
Trustee, and the applicable Custodian, an Officer's Certificate which shall
include a statement to the effect that all amounts received in connection with
such prepayment that are required to be deposited in the Distribution Account
pursuant to Section 4.01 have been so deposited. All original documents that
are not delivered to the applicable Custodian on behalf of the Trustee shall
be held by the Master Servicer or the related Servicer in trust for the
benefit of the Trustee and the Certificateholders.
(e) Neither the Depositor nor the Trust will acquire or hold any
Mortgage Loan that would violate the representations made by the Seller set
forth in clauses (iv) through (ix) of Section 2.05(b) hereof.
Section 2.02 Acceptance of Trust Fund by Trustee; Review of
Documentation for Trust Fund.
(a) The Trustee, by execution and delivery hereof, acknowledges
receipt by it of notice from the Custodians that each holds the Trustee
Mortgage Files pertaining to the Mortgage Loans listed on the Mortgage Loan
Schedule.
(b) Nothing in this Agreement shall be construed to constitute an
assumption by the Trust Fund, the Trustee, any Custodian or the
Certificateholders of any unsatisfied duty, claim or other liability on any
Mortgage Loan or to any Mortgagor.
49
(c) Each of the parties hereto acknowledges that (i) the Custodian
has delivered the Custodian Certification stating that it has performed the
applicable review of the Mortgage Loans as required herein and in the
Custodial Agreements on the Closing Date and (ii) thereafter, if applicable,
the Custodian shall perform the applicable review of the Mortgage Loans and
deliver the further certifications as provided herein and in the applicable
Custodial Agreements.
(d) Upon execution of this Agreement, the Depositor hereby delivers
to the Trustee (with a copy to the Securities Administrator) and the Trustee
acknowledges receipt of the Acknowledgements, together with the related
Purchase and Servicing Agreements.
Section 2.03 Representations and Warranties of the Depositor.
(a) The Depositor hereby represents and warrants to the Trustee, for
the benefit of the Certificateholders, and to the Master Servicer and the
Securities Administrator as of the Closing Date or such other date as is
specified, that:
(i) the Depositor is a corporation duly organized, validly
existing and in good standing under the laws governing its creation
and existence and has full corporate power and authority to own its
property, to carry on its business as presently conducted, to enter
into and perform its obligations under this Agreement, and to create
the trust pursuant hereto;
(ii) the execution and delivery by the Depositor of this
Agreement have been duly authorized by all necessary corporate action
on the part of the Depositor; neither the execution and delivery of
this Agreement, nor the consummation of the transactions herein
contemplated, nor compliance with the provisions hereof, will
conflict with or result in a breach of, or constitute a default
under, any of the provisions of any law, governmental rule,
regulation, judgment, decree or order binding on the Depositor or its
properties or the certificate of incorporation or bylaws of the
Depositor;
(iii) the execution, delivery and performance by the Depositor
of this Agreement and the consummation of the transactions
contemplated hereby do not require the consent or approval of, the
giving of notice to, the registration with, or the taking of any
other action in respect of, any state, federal or other governmental
authority or agency, except such as has been obtained, given,
effected or taken prior to the date hereof;
(iv) this Agreement has been duly executed and delivered by the
Depositor and, assuming due authorization, execution and delivery by
the Trustee, the Master Servicer and the Securities Administrator,
constitutes a valid and binding obligation of the Depositor
enforceable against it in accordance with its terms except as such
enforceability may be subject to (A) applicable bankruptcy and
insolvency laws and other similar laws affecting the enforcement of
the rights of creditors generally and (B) general principles of
equity regardless of whether such enforcement is considered in a
proceeding in equity or at law;
(v) there are no actions, suits or proceedings pending or, to
the knowledge of the Depositor, threatened or likely to be asserted
against or affecting the Depositor,
50
before or by any court, administrative agency, arbitrator or
governmental body (A) with respect to any of the transactions
contemplated by this Agreement or (B) with respect to any other
matter which in the judgment of the Depositor will be determined
adversely to the Depositor and will if determined adversely to the
Depositor materially and adversely affect it or its business, assets,
operations or condition, financial or otherwise, or adversely affect
its ability to perform its obligations under this Agreement;
(vi) immediately prior to the transfer and assignment of the
Mortgage Loans to the Trustee, the Depositor was the sole owner of
record and holder of each Mortgage Loan, and the Depositor had good
and marketable title thereto, and had full right to transfer and sell
each Mortgage Loan to the Trustee free and clear, subject only to (1)
liens of current real property taxes and assessments not yet due and
payable and, if the related Mortgaged Property is a condominium unit,
any lien for common charges permitted by statute, (2) covenants,
conditions and restrictions, rights of way, easements and other
matters of public record as of the date of recording of such Mortgage
acceptable to mortgage lending institutions in the area in which the
related Mortgaged Property is located and specifically referred to in
the lender's title insurance policy or attorney's opinion of title
and abstract of title delivered to the originator of such Mortgage
Loan, and (3) such other matters to which like properties are
commonly subject which do not, individually or in the aggregate,
materially interfere with the benefits of the security intended to be
provided by the Mortgage, of any encumbrance, equity, participation
interest, lien, pledge, charge, claim or security interest, and had
full right and authority, subject to no interest or participation of,
or agreement with, any other party, to sell and assign each Mortgage
Loan pursuant to this Agreement;
(vii) This Agreement creates a valid and continuing security
interest (as defined in the applicable Uniform Commercial Code (the
"UCC"), in the Mortgage Loans in favor of the Trustee, which security
interest is prior to all other liens, and is enforceable as such
against creditors of and purchasers from the Depositor;
(viii) The Mortgage Loans constitute "instruments" within the
meaning of the applicable UCC;
(ix) Other than the security interest granted to the Trustee
pursuant to this Agreement, the Depositor has not pledged, assigned,
sold, granted a security interest in, or otherwise conveyed any of
the Mortgage Loans. The Depositor has not authorized the filing of
and is not aware of any financing statement against the Depositor
that includes a description of the collateral covering the Mortgage
Loans other than a financing statement relating to the security
interest granted to the Trustee hereunder or that has been
terminated. The Depositor is not aware of any judgment or tax lien
filings against the Depositor;
(x) None of the Mortgage Loans have any marks or notations
indicating that such Mortgage Loans have been pledged, assigned or
otherwise conveyed to any Person other than the Trustee; and
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(xi) The Depositor has received all consents and approvals
required by the terms of the Mortgage Loans to convey the Mortgage
Loans hereunder to the Trustee.
The foregoing representations made in this Section 2.03 shall survive
the termination of this Agreement and shall not be waived by any party hereto.
Section 2.04 Representations and Warranties of the Depositor and the
Seller as to the Mortgage Loans.
The Depositor hereby represents and warrants to the Trustee with
respect to the Mortgage Loans or each Mortgage Loan, as the case may be, as of
the date hereof or such other date set forth herein that as of the Closing Date:
(a) Immediately prior to the transfer and assignment contemplated
herein, the Depositor was the sole owner and holder of the Mortgage Loans. The
Mortgage Loans were not assigned or pledged by the Depositor and the Depositor
had good and marketable title thereto, and the Depositor had full right to
transfer and sell the Mortgage Loans to the Trustee free and clear of any
encumbrance, participation interest, lien, equity, pledge, claim or security
interest and had full right and authority subject to no interest or
participation in, or agreement with any other party to sell or otherwise
transfer the Mortgage Loans.
(b) As of the Closing Date, the Depositor has transferred all right,
title and interest in the Mortgage Loans to the Trustee on behalf of the
Trust.
(c) As of the Closing Date, the Depositor has not transferred the
Mortgage Loans to the Trustee on behalf of the Trust with any intent to
hinder, delay or defraud an of its creditors.
It is understood and agreed that the representations and warranties
set forth in this Section 2.04 shall survive delivery of the respective
Mortgage Files to the Trustee or the Custodian and shall inure to the benefit
of the Trustee, notwithstanding any restrictive or qualified endorsement or
assignment.
Section 2.05 Representations and Warranties of the Seller; Discovery
of Breach; Repurchase or Substitution of Mortgage Loans.
(a) With respect to the MSMCI Mortgage Loans the Seller hereby makes
the representations and warranties contained in Section 3.01 of the MSMCI
Purchase Agreement to and for the benefit of the Depositor, the Trustee and
the Trust Fund.
(b) The Seller hereby represents and warrants that no Mortgage Loan
contains a provision whereby the related mortgagor is permitted to convert the
Mortgage Rate from an adjustable rate to a fixed rate.
With respect to the Quicken Mortgage Loans, the Seller hereby makes the
representations and warranties contained in Section 9.02 of the Quicken Purchase
and Servicing Agreement with respect to each of the Quicken Mortgage Loans to
and for the benefit of the Depositor, the Trustee and the Trust Fund. The Seller
agrees to comply with the provisions of Section 9.03 of the Quicken Purchase and
Servicing Agreement in respect of a breach of any of such
52
representations and warranties. In addition, with respect to the Quicken
Mortgage Loans, the Seller hereby represents and warrants that each
such Quicken Mortgage Loan is a "qualified mortgage" within the meaning of
Section 860G(a)(3) of the Code.
The Seller agrees to comply with the provisions of this Section 2.05 in
respect of a breach of any of such representations and warranties.
The Seller hereby represents and warrants to the Trustee with respect
to the Mortgage Loans as of the date hereof or such other date set forth herein
that as of the Closing Date:
(i) Each Mortgage Loan at origination complied in all material
respects with applicable predatory and abusive lending laws and
consummation of the transactions contemplated by this Agreement will
not involve the violation of any such laws.
(ii) All of the Mortgage Loans were originated in compliance
with all applicable laws, including, but not limited to, all
applicable anti-predatory and abusive lending laws.
(iii) None of the Mortgage Loans is covered by the Home
Ownership and Equity Protection Act of 1994 ("HOEPA").
(iv) None of the Mortgage Loans is a "high cost" loan as defined
by applicable predatory and abusive lending laws.
(v) No Mortgage Loan is a High Cost Loan or Covered Loan, as
applicable, and with respect to the foregoing, the terms "High Cost
Loan" and "Covered Loan" have the meaning assigned to them in the
Standard & Poor's LEVELS(R) Version 5.6 Glossary Revised, Appendix E
which is attached hereto as Exhibit Q (the "Glossary") where (x) a
"High Cost Loan" is each loan identified in the column "Category
under applicable anti-predatory lending law" of the table entitled
"Standard & Poor's High Cost Loan Categorization" in the Glossary as
each such loan is defined in the applicable anti-predatory lending
law of the State or jurisdiction specified in such table and (y) a
"Covered Loan" is each loan identified in the column "Category under
applicable anti-predatory lending law" of the table entitled
"Standard & Poor's High Covered Loan Categorization" in the Glossary
as each such loan is defined in the applicable anti-predatory lending
law of the State or jurisdiction specified in such table.
(vi) No Mortgage Loan originated on or after October 1, 2002
through March 6, 2003 is governed by the Georgia Fair Lending Act.
(vii) None of the Mortgage Loans that are secured by property
located in the State of Illinois are in violation of the provisions
of the Illinois Interest Act (815 Ill. Comp. Stat. 205/1 et. seq.).
(viii) No Mortgage Loan is a "High-Cost Home Loan" as defined in
the New Jersey Home Ownership Act effective November 27, 2003
(N.J.S.A. 46:10B-22 et seq.).
53
(ix) No Mortgage Loan is a "High-Cost Home Loan" as defined in
the New Mexico Home Loan Protection Act effective January 1, 2004
(N.M. Stat. Xxx. xx.xx. 58-21a-1 et seq.)
(x) No Mortgage Loan is a "High Cost Home Mortgage Loan" as
defined in the Massachusetts Predatory Home Loan Practices Act
effective November 7, 2004.
Upon discovery by the Depositor, the Seller or the related Originator
or receipt of written notice of any materially defective document in, or,
following the date of delivery to the Trustee of the Custodian's certifications
as required under the related Custodial Agreements, that a document is missing
from, a Trustee Mortgage File, or discovery by the Trustee, the Depositor, the
Seller or the related Originator of the breach by such Originator or Seller of
any representation or warranty under the related Purchase and Servicing
Agreement, as modified by the Acknowledgement, in the case of the Originator, or
under this Agreement, in the case of the Seller, in respect of any Mortgage Loan
which materially adversely affects the value of that Mortgage Loan or the
interest therein of the Certificateholders (a "Defective Mortgage Loan") (each
of the Depositor, the Seller and the related Originator hereby agreeing to give
written notice thereof to the Trustee and the other of such parties), the
Trustee, or its designee, shall promptly notify the Depositor and the Seller or
the related Originator, as applicable, in writing of such nonconforming or
missing document or breach and request that the Seller or related Originator
deliver such missing document or cure or cause the cure of such defect or breach
within a period of time specified in the related Purchase and Servicing
Agreement, and if the Seller or related Originator, as applicable, does not
deliver such missing document or cure such defect or breach in all material
respects during such period, the Trustee, shall enforce the obligations of the
related Originator under the related Purchase and Servicing Agreement, as
modified by the Acknowledgement, or the Seller under this Agreement, as
applicable, and cause the related Originator or the Seller, as the case may be,
to repurchase that Mortgage Loan from the Trust Fund at the Purchase Price on or
prior to the Determination Date following the expiration of such specified
period (subject to Section 2.05(c) below); provided, however, that, in
connection with any such breach that could not reasonably have been cured within
such specified period (unless permitted a greater period of time to cure under
the related Purchase and Servicing Agreement), subject to Section 2.05(c) below,
if the related Originator or the Seller, as applicable, shall have commenced to
cure such breach within such specified period, the related Originator or the
Seller shall be permitted to proceed thereafter diligently and expeditiously to
cure the same within such additional time as is reasonably necessary to cure
such breach. To the extent that any costs and damages are incurred by the Trust
Fund as a result of any violation of any applicable federal, state, or local
predatory or abusive lending law arising from or in connection with the
origination of any Mortgage Loan repurchased by the related Originator or the
Seller, such costs and damages shall be included in the Purchase Price of such
repurchased Mortgage Loan and shall be borne by the Seller. The Purchase Price
for the repurchased Mortgage Loan shall be deposited in the related Distribution
Account, and the Trustee, or its designee, upon receipt of written certification
from the Securities Administrator of such deposit, shall release or cause the
Custodian to release to the related Originator or the Seller, as applicable, the
related Trustee Mortgage File and shall execute and deliver such instruments of
transfer or assignment, in each case without recourse, representation or
warranties, as either party shall furnish to it and as shall be necessary to
vest in such party any Mortgage Loan released pursuant hereto and the Trustee,
or its designee, shall have no further responsibility with regard
54
to such Trustee Mortgage File (it being understood that the Trustee shall have
no responsibility for determining the sufficiency of such assignment for its
intended purpose). If pursuant to the foregoing provisions the related
Originator or the Seller repurchases a Mortgage Loan that is a MERS Mortgage
Loan, the related Servicer shall cause MERS to designate on the MERS(R) System
the related Originator or the Seller, as applicable, as the beneficial holder of
such Mortgage Loan.
In lieu of repurchasing any such Mortgage Loan as provided above,
either party may cause such Mortgage Loan to be removed from the Trust Fund (in
which case it shall become a Deleted Mortgage Loan) and substitute one or more
Replacement Mortgage Loans in the manner and subject to the limitations set
forth in Section 2.05(b) below. It is understood and agreed that the obligations
of the Originators and the Seller to cure or to repurchase (or to substitute
for) any related Mortgage Loan as to which a document is missing, a material
defect in a constituent document exists or as to which such a breach has
occurred and is continuing shall constitute the sole remedy against the such
party respecting such omission, defect or breach available to the Trustee on
behalf of the Certificateholders.
(c) Any substitution of Replacement Mortgage Loans for Deleted
Mortgage Loans made pursuant to Section 2.05(b) above must be effected prior
to the last Business Day that is within two years after the Closing Date. As
to any Deleted Mortgage Loan for which the related Originator or the Seller
substitutes a Replacement Mortgage Loan or Loans, such substitution shall be
effected by delivering to the Custodian, on behalf of the Trustee, for such
Replacement Mortgage Loan or Loans, the Mortgage Note, the Mortgage, any
related assignment thereof and the Acknowledgement to the Trustee, and such
other documents and agreements, with all necessary endorsements thereon,
together with an Officers' Certificate stating that each such Replacement
Mortgage Loan satisfies the definition thereof and specifying the Substitution
Adjustment Amount (as described below), if any, in connection with such
substitution. Monthly Payments due with respect to Replacement Mortgage Loans
in the month of substitution shall not be included as part of the Trust Fund
and shall be retained by the related Originator or the Seller, as applicable.
For the month of substitution, distributions to the Certificateholders shall
reflect the collections and recoveries in respect of such Deleted Mortgage in
the Due Period preceding the month of substitution and the related Originator
or the Seller, as applicable, shall thereafter be entitled to retain all
amounts subsequently received in respect of such Deleted Mortgage Loan. Upon
such substitution, such Replacement Mortgage Loan shall constitute part of the
Trust Fund and shall be subject in all respects to the terms of this Agreement
and the related Purchase and Servicing Agreement, as modified by the related
Acknowledgement, including all representations and warranties thereof included
in such Purchase and Servicing Agreement, as modified by the Acknowledgement,
in each case as of the date of substitution.
For any month in which an Originator or the Seller substitutes one or
more Replacement Mortgage Loans for one or more Deleted Mortgage Loans, the
related Servicer shall determine the excess (each, a "Substitution Adjustment
Amount"), if any, by which the aggregate Purchase Price of all such Deleted
Mortgage Loans exceeds the aggregate Stated Principal Balance of the Replacement
Mortgage Loans replacing such Deleted Mortgage Loans, together with one month's
interest on such excess amount at the applicable Net Mortgage Rate. On the date
of such substitution, the related Originator or Seller, as applicable, shall
deliver or cause to be delivered to the related Servicer for deposit in the
related Custodial Account an amount equal to
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the related Substitution Adjustment Amount, if any, and the Custodian, on
behalf of the Trustee, upon receipt of the related Replacement Mortgage Loan
or Loans and certification by such Servicer of such deposit, shall release to
the related Originator or the Seller, as applicable, the related Trustee
Mortgage File or Files and shall execute and deliver such instruments of
transfer or assignment, in each case without recourse, as the related
Originator or Seller shall deliver to it and as shall be necessary to vest
therein any Deleted Mortgage Loan released pursuant hereto.
In addition, the related Originator or the Seller, as applicable, shall
obtain at its own expense and deliver to the Trustee and the Securities
Administrator an Opinion of Counsel to the effect that such substitution (either
specifically or as a Class of transactions) shall not cause an Adverse REMIC
Event. If such Opinion of Counsel cannot be delivered, then such substitution
may only be effected at such time as the required Opinion of Counsel can be
given.
(d) Upon discovery by the related Originator, the Seller, the
Depositor or the Trustee that any Mortgage Loan does not constitute a
"qualified mortgage" within the meaning of Section 860G(a)(3) of the Code, the
party discovering such fact shall within two Business Days give written notice
thereof to the other parties. In connection therewith, the applicable party
shall repurchase or, subject to the limitations set forth in Section 2.05(b),
substitute one or more Replacement Mortgage Loans for the affected Mortgage
Loan within 90 days of the earlier of discovery or receipt of such notice with
respect to such affected Mortgage Loan. Any such repurchase or substitution
shall be made in the same manner as set forth in Section 2.05(a) above and/or
in accordance with this Section 2.05(c). The Trustee shall re-convey to the
related Originator or the Seller, as applicable, the Mortgage Loan to be
released pursuant hereto in the same manner, and on the same terms and
conditions, as it would a Mortgage Loan repurchased for breach of a
representation or warranty.
Section 2.06 Grant Clause.
(a) It is intended that the conveyance of the Depositor's right,
title and interest in and to property constituting the Trust Fund pursuant to
this Agreement shall constitute, and shall be construed as, a sale of such
property and not a grant of a security interest to secure a loan. However, if
such conveyance is deemed to be in respect of a loan, it is intended that: (1)
the rights and obligations of the parties shall be established pursuant to the
terms of this Agreement; (2) the Depositor hereby grants to the Trustee for
the benefit of the Holders of the Certificates a first priority security
interest in all of the Depositor's right, title and interest in, to and under,
whether now owned or hereafter acquired, the Trust Fund and all proceeds of
any and all property constituting the Trust Fund to secure payment of the
Certificates; and (3) this Agreement shall constitute a security agreement
under applicable law. If such conveyance is deemed to be in respect of a loan
and the trust created by this Agreement terminates prior to the satisfaction
of the claims of any Person holding any Certificate, the security interest
created hereby shall continue in full force and effect and the Trustee shall
be deemed to be the collateral agent for the benefit of such Person, and all
proceeds shall be distributed as herein provided.
(b) The Depositor shall, to the extent consistent with this
Agreement, take such reasonable actions as may be necessary to ensure that, if
this Agreement were deemed to create a security interest in the Mortgage Loans
and the other property described above, such security interest would be deemed
to be a perfected security interest of first priority under applicable law
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and will be maintained as such throughout the term of this Agreement. The
Depositor will, at its own expense, make all initial filings on or about the
Closing Date and shall forward a copy of such filing or filings to the
Trustee. Without limiting the generality of the foregoing, the Depositor shall
prepare and forward for filing, or shall cause to be forwarded for filing, at
the expense of the Depositor, all filings necessary to maintain the
effectiveness of any original filings necessary under the relevant UCC to
perfect the Trustee's security interest in or lien on the Mortgage Loans,
including without limitation (x) continuation statements, and (y) such other
statements as may be occasioned by (1) any change of name of an Originator,
the Depositor or the Trustee, (2) any change of location of the place of
business or the chief executive office of the Seller or the Depositor, (3) any
transfer of any interest of an Originator or the Depositor in any Mortgage
Loan or (4) any change under the relevant UCC or other applicable laws.
Neither the Originators nor the Depositor shall organize under the law of any
jurisdiction other than the State under which each is organized as of the
Closing Date (whether changing its jurisdiction of organization or organizing
under an additional jurisdiction) without giving 30 days prior written notice
of such action to its immediate and intermediate transferee, including the
Trustee. Before effecting such change, any Originator or the Depositor
proposing to change its jurisdiction of organization shall prepare and file in
the appropriate filing office any financing statements or other statements
necessary to continue the perfection of the interests of its immediate and
intermediate transferees, including the Trustee, in the Mortgage Loans. In
connection with the transactions contemplated by this Agreement, each of the
Originators and the Depositor authorizes its immediate or intermediate
transferee (but not the Trustee) to file in any filing office any initial
financing statements, any amendments to financing statements, any continuation
statements, or any other statements or filings described in this paragraph
(b).
ARTICLE III
THE CERTIFICATES
Section 3.01 The Certificates.
(a) The Certificates shall be issuable in registered form only and
shall be securities governed by Article 8 of the New York Uniform Commercial
Code. The Book-Entry Certificates will be evidenced by one or more
certificates, beneficial ownership of which will be held in the dollar
denominations in Certificate Balance, or Notional Amount, as applicable, or in
the Percentage Interests, specified herein. Each Class of Certificates will be
issued in the minimum denominations and integral multiples thereof of the
initial Certificate Balance (or Notional Amount) specified in the Preliminary
Statement hereto.
(b) The Certificates shall be executed by manual or facsimile
signature on behalf of the Trustee by an authorized officer of the Trustee or
of the Securities Administrator on the Trustee's behalf. Each Certificate
shall, on original issue, be authenticated by the Authenticating Agent upon
the order of the Depositor upon receipt by the Trustee of the Trustee Mortgage
Files described in Section 2.01. No Certificate shall be entitled to any
benefit under this Agreement, or be valid for any purpose, unless there
appears on such Certificate a certificate of authentication substantially in
the form provided for herein, executed by an authorized officer of the
Authenticating Agent, by manual signature, and such certification upon any
Certificate shall be conclusive evidence, and the only evidence, that such
Certificate has been duly authenticated
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and delivered hereunder. All Certificates shall be dated the date of
their authentication. At any time and from time to time after the execution
and delivery of this Agreement, the Depositor may deliver Certificates
executed by or on behalf of the Trustee to the Authenticating Agent for
authentication and the Authenticating Agent shall authenticate and deliver
such Certificates as in this Agreement provided and not otherwise.
(c) The Class 1-B-4, Class B-4, Class 1-B-5, Class B-5, Class 1-B-6,
Class B-6, Class 1-P, Class 2-P and Class A-R Certificates offered and sold in
reliance on the exemption from registration under Rule 144A under the Act
shall be issued initially in definitive, fully registered form without
interest coupons with the applicable legends set forth in Exhibit A added to
the forms of such Certificates (each, a "Restricted Global Security").
Section 3.02 Registration.
The Securities Administrator is hereby appointed, and the Securities
Administrator hereby accepts its appointment as, initial Certificate Registrar
in respect of the Certificates and shall maintain books for the registration and
for the transfer of Certificates (the "Certificate Register"). The Trustee may
appoint a bank or trust company to act as successor Certificate Registrar. A
registration book shall be maintained for the Certificates collectively. The
Certificate Registrar may resign or be discharged or removed and a new successor
may be appointed in accordance with the procedures and requirements set forth in
Sections 6.06 and 6.07 hereof with respect to the resignation, discharge or
removal of the Securities Administrator and the appointment of a successor
Securities Administrator. The Certificate Registrar may appoint, by a written
instrument delivered to the Holders and the Master Servicer, any bank or trust
company to act as co-registrar under such conditions as the Certificate
Registrar may prescribe; provided, however, that the Certificate Registrar shall
not be relieved of any of its duties or responsibilities hereunder by reason of
such appointment.
Section 3.03 Transfer and Exchange of Certificates.
(a) A Certificate (other than Book-Entry Certificates which shall be
subject to Section 3.09 hereof) may be transferred by the Holder thereof only
upon presentation and surrender of such Certificate at the office of the
Certificate Registrar duly endorsed or accompanied by an assignment duly
executed by such Holder or his duly authorized attorney in such form as shall
be satisfactory to the Certificate Registrar. Upon the transfer of any
Certificate in accordance with the preceding sentence, the Securities
Administrator on behalf of the Trustee shall execute, and the Authenticating
Agent shall authenticate and deliver to the transferee, one or more new
Certificates of the same Class and evidencing, in the aggregate, the same
aggregate Certificate Balance (or Notional Amount) as the Certificate being
transferred. No service charge shall be made to a Certificateholder for any
registration of transfer of Certificates, but the Certificate Registrar may
require payment of a sum sufficient to cover any tax or governmental charge
that may be imposed in connection with any registration of transfer of
Certificates.
(b) A Certificate may be exchanged by the Holder thereof for any
number of new Certificates of the same Class, in authorized denominations,
representing in the aggregate the same Certificate Balance (or Notional
Amount) as the Certificate surrendered, upon surrender of
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the Certificate to be exchanged at the office of the Certificate Registrar
duly endorsed or accompanied by a written instrument of transfer duly executed
by such Holder or his duly authorized attorney in such form as is satisfactory
to the Certificate Registrar. Certificates delivered upon any such exchange
will evidence the same obligations, and will be entitled to the same rights
and privileges, as the Certificates surrendered. No service charge shall be
made to a Certificateholder for any exchange of Certificates, but the
Certificate Registrar may require payment of a sum sufficient to cover any tax
or governmental charge that may be imposed in connection with any exchange of
Certificates. Whenever any Certificates are so surrendered for exchange, the
Securities Administrator on behalf of the Trustee shall execute, and the
Authenticating Agent shall authenticate, date and deliver the Certificates
which the Certificateholder making the exchange is entitled to receive.
(c) By acceptance of a Restricted Certificate, whether upon original
issuance or subsequent transfer, each Holder of such a Certificate
acknowledges the restrictions on the transfer of such Certificate set forth
thereon and agrees that it will transfer such a Certificate only as provided
herein.
The following restrictions shall apply with respect to the transfer and
registration of transfer of a Restricted Certificate to a transferee that takes
delivery in the form of a Definitive Certificate:
(i) The Certificate Registrar shall register the transfer of a
Restricted Certificate if the requested transfer is (x) to the
Depositor or an affiliate (as defined in Rule 405 under the 0000
Xxx) of the Depositor or (y) being made to a "qualified
institutional buyer" (a "QIB") as defined in Rule 144A under the
Securities Act of 1933, as amended (the "Act") by a transferor that
has provided the Certificate Registrar with a certificate in the
form of Exhibit H hereto; and
(ii) The Certificate Registrar shall register the transfer of a
Restricted Certificate if the requested transfer is being made to an
"accredited investor" under Rule 501(a)(1), (2), (3) or (7) under
the Act, or to any Person all of the equity owners in which are such
accredited investors, by a transferor who furnishes to the
Certificate Registrar a letter of the transferee substantially in
the form of Exhibit I hereto.
(d) No transfer of an ERISA-Restricted Certificate in the form of a
Definitive Certificate shall be made to any Person or shall be effective
unless the Certificate Registrar, on behalf of the Trustee, has received (A) a
certificate substantially in the form of Exhibit J hereto (or Exhibit B, in
the case of a Residual Certificate) from such transferee or (B) an Opinion of
Counsel satisfactory to the Certificate Registrar and the Securities
Administrator to the effect that the purchase and holding of such a
Certificate will not constitute or result in any nonexempt prohibited
transactions under Title I of ERISA or Section 4975 of the Code and will not
subject the Certificate Registrar, the Trustee, the Master Servicer, the
Depositor or the Securities Administrator to any obligation in addition to
those undertaken in the Agreement; provided, however, that the Certificate
Registrar will not require such certificate or opinion in the event that, as a
result of a change of law or otherwise, counsel satisfactory to the
Certificate Registrar has rendered an opinion to the effect that the purchase
and holding of an ERISA-Restricted Certificate by a Plan or a Person that is
purchasing or holding such a Certificate with the assets
59
of a Plan will not constitute or result in a prohibited transaction under
Title I of ERISA or Section 4975 of the Code and will not subject the
Certificate Registrar, the Trustee, the Master Servicer, the Depositor or the
Securities Administrator to any obligation in addition to those undertaken in
this Agreement. Each Transferee of an ERISA-Restricted Certificate that is a
Book-Entry Certificate shall be deemed to have made the appropriate
representation set forth in paragraph 2 and the representation set forth in
paragraph 3 of Exhibit J. The preparation and delivery of the certificate and
opinions referred to above shall not be an expense of the Trust Fund, the
Certificate Registrar, the Trustee, the Master Servicer, the Depositor or the
Securities Administrator.
Notwithstanding the foregoing, no opinion or certificate shall be
required for the initial issuance of the ERISA-Restricted Certificates to the
Underwriter. The Certificate Registrar shall have no obligation to monitor
transfers of Book-Entry Certificates that are ERISA-Restricted Certificates and
shall have no liability for transfers of such Certificates in violation of the
transfer restrictions. The Certificate Registrar shall be under no liability to
any Person for any registration of transfer of any ERISA-Restricted Certificate
that is in fact not permitted by this Section 3.03(d) and neither the Securities
Administrator nor the Paying Agent shall have any liability for making any
payments due on such Certificate to the Holder thereof or taking any other
action with respect to such Holder under the provisions of this Agreement so
long as the transfer was registered by the Certificate Registrar in accordance
with the foregoing requirements. The Securities Administrator, on behalf of the
Trustee, shall be entitled, but not obligated, to recover from any Holder of any
ERISA-Restricted Certificate that was in fact a Plan or a Person acting on
behalf of a Plan any payments made on such ERISA-Restricted Certificate at and
after such time. Any such payments so recovered by the Securities Administrator,
on behalf of the Trustee, shall be paid and delivered by the Securities
Administrator, on behalf of the Trustee, to the last preceding Holder of such
Certificate that is not such a Plan or Person acting on behalf of a Plan.
(e) As a condition of the registration of transfer or exchange of any
Certificate, the Certificate Registrar may require the certified taxpayer
identification number of the owner of the Certificate and the payment of a sum
sufficient to cover any tax or other governmental charge imposed in connection
therewith; provided, however, that the Certificate Registrar shall have no
obligation to require such payment or to determine whether or not any such tax
or charge may be applicable. No service charge shall be made to the
Certificateholder for any registration, transfer or exchange of a Certificate.
(f) Notwithstanding anything to the contrary contained herein, no
Residual Certificate may be owned, pledged or transferred, directly or
indirectly, by or to (i) a Disqualified Organization or (ii) an individual,
corporation or partnership or other person unless such person (A) is not a
Non-U.S. Person or (B) is a Non-U.S. Person that holds a Residual Certificate
in connection with the conduct of a trade or business within the United States
and has furnished the transferor and the Certificate Registrar with an
effective Internal Revenue Service Form W-8ECI or successor form at the time
and in the manner required by the Code (any such person who is not covered by
clause (A) or (B) above is referred to herein as a "Non-permitted Foreign
Holder").
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Prior to and as a condition of the registration of any transfer, sale
or other disposition of a Residual Certificate, the proposed transferee shall
deliver to the Certificate Registrar an affidavit in substantially the form
attached hereto as Exhibit B representing and warranting, among other things,
that such transferee is neither a Disqualified Organization, an agent or nominee
acting on behalf of a Disqualified Organization, nor a Non-permitted Foreign
Holder (any such transferee, a "Permitted Transferee"), and the proposed
transferor shall deliver to the Trustee and the Certificate Registrar an
affidavit in substantially the form attached hereto as Exhibit C. In addition,
the Trustee or the Certificate Registrar may (but shall have no obligation to)
require, prior to and as a condition of any such transfer, the delivery by the
proposed transferee of an Opinion of Counsel, addressed to the Trustee and the
Certificate Registrar, that such proposed transferee or, if the proposed
transferee is an agent or nominee, the proposed beneficial owner, is not a
Disqualified Organization, agent or nominee thereof, or a Non-permitted Foreign
Holder. Notwithstanding the registration in the Certificate Register of any
transfer, sale, or other disposition of a Residual Certificate to a Disqualified
Organization, an agent or nominee thereof, or Non-permitted Foreign Holder, such
registration shall be deemed to be of no legal force or effect whatsoever and
such Disqualified Organization, agent or nominee thereof, or Non-permitted
Foreign Holder shall not be deemed to be a Certificateholder for any purpose
hereunder, including, but not limited to, the receipt of distributions on such
Residual Certificate. The Depositor and the Certificate Registrar shall be under
no liability to any Person for any registration or transfer of a Residual
Certificate to a Disqualified Organization, agent or nominee thereof or
Non-permitted Foreign Holder or for the Paying Agent making any payments due on
such Residual Certificate to the Holder thereof or for taking any other action
with respect to such Holder under the provisions of the Agreement, so long as
the transfer was effected in accordance with this Section 3.03(f), unless the
Certificate Registrar shall have actual knowledge at the time of such transfer
or the time of such payment or other action that the transferee is a
Disqualified Organization, or an agent or nominee thereof, or Non-permitted
Foreign Holder. The Certificate Registrar shall be entitled to recover from any
Holder of a Residual Certificate that was a Disqualified Organization, agent or
nominee thereof, or Non-permitted Foreign Holder at the time it became a Holder
or any subsequent time it became a Disqualified Organization, agent or nominee
thereof, or Non-permitted Foreign Holder, all payments made on such Residual
Certificate at and after either such times (and all costs and expenses,
including but not limited to attorneys' fees, incurred in connection therewith).
Any payment (not including any such costs and expenses) so recovered by the
Certificate Registrar shall be paid and delivered to the last preceding Holder
of such Residual Certificate.
If any purported transferee shall become a registered Holder of a
Residual Certificate in violation of the provisions of this Section 3.03(f),
then upon receipt of written notice to the Trustee or the Certificate Registrar
that the registration of transfer of such Residual Certificate was not in fact
permitted by this Section 3.03(f), the last preceding Permitted Transferee shall
be restored to all rights as Holder thereof retroactive to the date of such
registration of transfer of such Residual Certificate. The Depositor, the
Certificate Registrar and the Trustee shall be under no liability to any Person
for any registration of transfer of a Residual Certificate that is in fact not
permitted by this Section 3.03(f), or for the Paying Agent making any payment
due on such Certificate to the registered Holder thereof or for taking any other
action with respect to such Holder under the provisions of this Agreement so
long as the transfer was registered upon receipt of the affidavit described in
the preceding paragraph of this Section 3.03(f).
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(g) Each Holder or Certificate Owner of a Restricted Certificate,
ERISA-Restricted Certificate or Residual Certificate, or an interest therein,
by such Holder's or Owner's acceptance thereof, shall be deemed for all
purposes to have consented to the provisions of this section.
Section 3.04 Cancellation of Certificates.
Any Certificate surrendered for registration of transfer or exchange
shall be cancelled and retained in accordance with normal retention policies
with respect to cancelled certificates maintained by the Certificate
Registrar.
Section 3.05 Replacement of Certificates.
If (i) any Certificate is mutilated and is surrendered to the Trustee
or the Certificate Registrar or (ii) the Certificate Registrar receives
evidence to its satisfaction of the destruction, loss or theft of any
Certificate, and there is delivered to the Trustee and the Certificate
Registrar such security or indemnity as may be required by them to save each
of them harmless, then, in the absence of notice to the Depositor, the Trustee
or the Certificate Registrar that such destroyed, lost or stolen Certificate
has been acquired by a protected purchaser, the Securities Administrator on
behalf of the Trustee shall execute and the Authenticating Agent shall
authenticate and deliver, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Certificate, a new Certificate of like tenor and
Certificate Balance. Upon the issuance of any new Certificate under this
Section 3.05, the Trustee, the Depositor or the Certificate Registrar may
require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses
(including the fees and expenses of the Trustee, the Depositor or the
Certificate Registrar) connected therewith. Any replacement Certificate issued
pursuant to this Section 3.05 shall constitute complete and indefeasible
evidence of ownership in the applicable Trust Fund, as if originally issued,
whether or not the lost, stolen or destroyed Certificate shall be found at any
time.
If after the delivery of such new Certificate, a protected purchaser
of the original Certificate in lieu of which such new Certificate was issued
presents for payment such original Certificate, the Depositor, the Certificate
Registrar and the Trustee or any agent shall be entitled to recover such new
Certificate from the Person to whom it was delivered or any Person taking
therefrom, except a protected purchaser, and shall be entitled to recover upon
the security or indemnity provided therefor to the extent of any loss, damage,
cost or expenses incurred by the Depositor, the Certificate Registrar, the
Trustee or any agent in connection therewith.
Section 3.06 Persons Deemed Owners.
Subject to the provisions of Section 3.09 with respect to Book-Entry
Certificates, the Depositor, the Master Servicer, the Trustee, the Certificate
Registrar, the Paying Agent and any agent of any of them shall treat the
Person in whose name any Certificate is registered upon the books of the
Certificate Registrar as the owner of such Certificate for the purpose of
receiving distributions pursuant to Sections 5.01 and 5.02 and for all other
purposes whatsoever, and neither the Depositor, the Master Servicer, the
Trustee, the Certificate Registrar, the Paying Agent nor any agent of any of
them shall be affected by notice to the contrary.
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Section 3.07 Temporary Certificates.
(a) Pending the preparation of definitive Certificates, upon the
order of the Depositor, the Securities Administrator on behalf of the Trustee
shall execute and the Authenticating Agent shall authenticate and deliver
temporary Certificates that are printed, lithographed, typewritten,
mimeographed or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive Certificates in lieu of which
they are issued and with such variations as the authorized officers executing
such Certificates may determine, as evidenced by their execution of such
Certificates.
(b) If temporary Certificates are issued, the Depositor will cause
definitive Certificates to be prepared without unreasonable delay. After the
preparation of definitive Certificates, the temporary Certificates shall be
exchangeable for definitive Certificates upon surrender of the temporary
Certificates at the office or agency of the Certificate Registrar without
charge to the Holder. Upon surrender for cancellation of any one or more
temporary Certificates, the Securities Administrator on behalf of the Trustee
shall execute and the Authenticating Agent shall authenticate and deliver in
exchange therefor a like aggregate Certificate Balance of definitive
Certificates of the same Class in the authorized denominations. Until so
exchanged, the temporary Certificates shall in all respects be entitled to the
same benefits under this Agreement as definitive Certificates of the same
Class.
Section 3.08 Appointment of Paying Agent.
The Trustee may appoint a Paying Agent (which may be the Trustee) for
the purpose of making distributions to the Certificateholders hereunder. The
Securities Administrator is hereby appointed as the initial Paying Agent. The
Trustee shall cause any Paying Agent, other than the Securities Administrator,
to execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with the Trustee that such Paying Agent will hold all sums held by
it for the payment to the Certificateholders in an Eligible Account (which shall
be the Distribution Account) in trust for the benefit of the Certificateholders
entitled thereto until such sums shall be paid to the Certificateholders. All
funds remitted by the Securities Administrator to any such Paying Agent for the
purpose of making distributions shall be paid to the Certificateholders on each
Distribution Date and any amounts not so paid shall be returned on such
Distribution Date to the Securities Administrator. If the Paying Agent is not
the Trustee or the Securities Administrator, the Securities Administrator shall
cause to be remitted to the Paying Agent on or before the Business Day prior to
each Distribution Date, by wire transfer in immediately available funds, the
funds to be distributed on such Distribution Date. Any Paying Agent shall be
either a bank or trust company or otherwise authorized under law to exercise
corporate trust powers.
Section 3.09 Book-Entry Certificates.
(a) Each Class of Book-Entry Certificates, upon original issuance,
shall be issued in the form of one or more typewritten Certificates
representing the Book-Entry Certificates. The Book-Entry Certificates shall
initially be registered on the Certificate Register in the name of the nominee
of the Clearing Agency, and no Certificate Owner will receive a definitive
certificate representing such Certificate Owner's interest in the Book-Entry
Certificates, except as provided
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in Section 3.09(c). Unless Definitive Certificates have been issued to
Certificate Owners of Book-Entry Certificates pursuant to Section 3.09(c):
(i) the provisions of this Section 3.09 shall be in full force
and effect;
(ii) the Certificate Registrar, the Paying Agent and the
Trustee shall deal with the Clearing Agency for all purposes
(including the making of distributions on the Book-Entry
Certificates) as the authorized representatives of the Certificate
Owners and the Clearing Agency and shall be responsible for
crediting the amount of such distributions to the accounts of such
Persons entitled thereto, in accordance with the Clearing Agency's
normal procedures;
(iii) to the extent that the provisions of this Section 3.09
conflict with any other provisions of this Agreement, the provisions
of this Section 3.09 shall control; and
(iv) the rights of Certificate Owners shall be exercised only
through the Clearing Agency and the Clearing Agency Participants and
shall be limited to those established by law and agreements between
such Certificate Owners and the Clearing Agency and/or the Clearing
Agency Participants. Unless and until Definitive Certificates are
issued pursuant to Section 3.09(c), the initial Clearing Agency will
make book-entry transfers among the Clearing Agency Participants and
receive and transmit distributions of principal of and interest on
the Book-Entry Certificates to such Clearing Agency Participants.
(b) Whenever notice or other communication to the Certificateholders
is required under this Agreement, unless and until Definitive Certificates
shall have been issued to Certificate Owners pursuant to Section 3.09(c), the
Securities Administrator shall give all such notices and communications
specified herein to be given to Holders of the Book-Entry Certificates to the
Clearing Agency.
(c) If (i) (A) the Clearing Agency or the Depositor advises the
Certificate Registrar in writing that the Clearing Agency is no longer willing
or able to discharge properly its responsibilities with respect to the
Book-Entry Certificates, and (B) the Depositor is unable to locate a qualified
successor satisfactory to the Depositor and the Certificate Registrar or, (ii)
after the occurrence of an Event of Default, Certificate Owners representing
beneficial interests aggregating not less than 50% of the Class Principal
Balance of a Class of Book-Entry Certificates advise the Paying Agent and the
Clearing Agency through the Clearing Agency Participants in writing that the
continuation of a book-entry system through the Clearing Agency is no longer
in the best interests of the Certificate Owners of a Class of Book-Entry
Certificates, the Certificate Registrar shall notify the Clearing Agency to
effect notification to all Certificate Owners, through the Clearing Agency, of
the occurrence of any such event and of the availability of Definitive
Certificates to Certificate Owners requesting the same. Upon surrender to the
Certificate Registrar of the Book-Entry Certificates by the Clearing Agency,
accompanied by registration instructions from the Clearing Agency for
registration, the Certificate Registrar shall issue the Definitive
Certificates. Neither the Depositor, the Certificate Registrar nor the Trustee
shall be liable for any delay in delivery of such instructions and may
conclusively rely on, and shall be protected in relying on, such instructions.
Upon the issuance of Definitive Certificates
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all references herein to obligations imposed upon or to be performed by the
Clearing Agency shall be deemed to be imposed upon and performed by the
Certificate Registrar, to the extent applicable, with respect to such
Definitive Certificates and the Certificate Registrar shall recognize the
holders of the Definitive Certificates as Certificateholders hereunder.
Notwithstanding the foregoing, the Certificate Registrar, upon the instruction
of the Depositor, shall have the right to issue Definitive Certificates on the
Closing Date in connection with credit enhancement programs.
ARTICLE IV
ADMINISTRATION OF THE TRUST FUND
Section 4.01 Custodial Accounts; Distribution Account.
(a) On or prior to the Closing Date, the Master Servicer shall have
caused each Servicer to establish and maintain one or more Custodial Accounts,
as provided in the related Purchase and Servicing Agreement, into which all
Scheduled Payments and unscheduled payments with respect to the related
Mortgage Loans, net of any deductions or reimbursements permitted under the
related Purchase and Servicing Agreement, shall be deposited. On each
Distribution Account Deposit Date, the Servicers shall remit to the Securities
Administrator for deposit into the Distribution Account, all amounts so
required to be deposited into such account in accordance with the terms of the
related Purchase and Servicing Agreements.
(b) The Securities Administrator, as Paying Agent for the Trustee,
shall establish and maintain an Eligible Account entitled "Distribution
Account of Deutsche Bank National Trust Company, as Trustee for the benefit of
Xxxxxx Xxxxxxx Mortgage Loan Trust 2004-11AR, Holders of Mortgage Pass-Through
Certificates." The Securities Administrator shall, promptly upon receipt from
the Servicers on each related Distribution Account Deposit Date, deposit into
the Distribution Account and retain on deposit until the related Distribution
Date the following amounts:
(i) the aggregate of collections with respect to the Mortgage
Loans remitted by the Servicers from the related Custodial Accounts
in accordance with the Purchase and Servicing Agreements;
(ii) any amounts required to be deposited by the Master Servicer
with respect to the Mortgage Loans for the related Due Period
pursuant to this Agreement, including the amount of any Advances or
Compensating Interest Payments with respect to the Mortgage Loans not
paid by the Servicers; and
(iii) any other amounts so required to be deposited in the
Distribution Account in the related Due Period pursuant to this
Agreement.
(c) In the event the Master Servicer or a Servicer has remitted in
error to the Distribution Account any amount not required to be remitted in
accordance with the definition of Available Funds, it may at any time direct
the Securities Administrator to withdraw such amount from the Distribution
Account for repayment to the Master Servicer or Servicer, as applicable, by
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delivery of an Officer's Certificate to the Securities Administrator and the
Trustee which describes the amount deposited in error.
(d) On each Distribution Date and Initial Optional Purchase Date, the
Securities Administrator, as Paying Agent, shall withdraw from funds available
in the Distribution Account and distribute the Available Funds to the
Certificateholders and any other parties entitled thereto in the amounts and
priorities set forth in Section 5.02. The Securities Administrator may from
time to time withdraw from the Distribution Account and pay the Master
Servicer, the Trustee, the Custodians, the Securities Administrator or any
Servicer any amounts permitted to be paid or reimbursed to such Person from
funds in the Distribution Account pursuant to this Agreement, any Purchase and
Servicing Agreement or the Custodial Agreements.
(e) [Reserved].
(f) Funds in the Distribution Account may be invested in Permitted
Investments selected by and at the written direction of the Securities
Administrator, which shall mature not later than one Business Day prior to the
Distribution Date (except that if such Permitted Investment is an obligation
of the Securities Administrator or any of its Affiliates, or is managed or
advised by the Securities Administrator or any Affiliate, then such Permitted
Investment shall mature not later than such applicable Distribution Date) and
any such Permitted Investment shall not be sold or disposed of prior to its
maturity. All such Permitted Investments shall be made in the name of the
Trustee (in its capacity as such) or its nominee. All income and gain realized
from any Permitted Investment of amounts on deposit in the Distribution
Account shall be for the benefit of the Securities Administrator, as
additional compensation for its duties hereunder, and shall be subject to its
withdrawal or order from time to time, and shall not be part of the Trust
Fund; provided, however, that if Xxxxx Fargo Bank, National Association is no
longer the Master Servicer and the Securities Administrator, any such income
and gain shall be used to pay the successor Master Servicer and the successor
Securities Administrator, the Master Servicer Compensation and the Securities
Administrator Compensation, respectively. The amount of any losses incurred in
respect of any such investments shall be deposited in such Distribution
Account by the Securities Administrator out of its own funds, without any
right of reimbursement therefor, immediately as realized.
Section 4.02 Permitted Withdrawals from the Custodial Accounts and
the Distribution Account.
(a) Each Servicer may from time to time make withdrawals from its
Custodial Account for the following purposes:
(i) to reimburse itself for unreimbursed Advances made by it,
such right of reimbursement pursuant to this subclause (i) being
limited to amounts received on the Mortgage Loan(s) in respect of
which any such Advance was made;
(ii) to reimburse itself for any Nonrecoverable Advance
previously made by it;
(iii) to reimburse itself for unreimbursed Servicer Advances,
each Servicer's right to reimbursement pursuant to this clause (a)
with respect to any Mortgage Loan
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being limited to amounts received on such Mortgage Loan(s) which
represent late recoveries of the payments for which such advances
were made pursuant to the related Purchase and Servicing Agreement;
(iv) to reimburse itself for expenses incurred by it and
reimbursable pursuant to the related Purchase and Servicing
Agreement; and
(v) to withdraw any amount deposited in the Custodial Account
and not required to be deposited therein.
To the extent required by the related Purchase and Servicing Agreement
each Servicer shall keep and maintain separate accounting, on a Mortgage Loan by
Mortgage Loan basis, for the purpose of justifying any withdrawal from its
Custodial Account pursuant to such subclauses (i), (ii), (iii), (iv) and (v).
Prior to making any withdrawal from its Custodial Account pursuant to subclause
(ii), the related Servicer shall deliver to the Master Servicer an Officer's
Certificate of a Servicing Officer indicating the amount of any previous Advance
determined by the Servicer to be a Nonrecoverable Advance and identifying the
related Mortgage Loans(s), and their respective portions of such Nonrecoverable
Advance.
(b) The Securities Administrator shall withdraw funds from the
Distribution Account for distributions to Certificateholders in the manner
specified in this Agreement (and to withhold from the amounts so withdrawn,
the amount of any taxes that it is authorized to withhold pursuant to Section
10.01). In addition, the Securities Administrator may from time to time make
withdrawals from the Distribution Account for the following purposes:
(i) to pay all costs and expenses described in clause (d) of
the definition of "Available Funds";
(ii) (x) for so long as Xxxxx Fargo Bank, National Association
is the Master Servicer and the Securities Administrator, to pay to
the Securities Administrator the investment earnings on the
Distribution Account as its compensation for the related
Distribution Date and (y) thereafter, concurrently, to the Master
Servicer and the Securities Administrator, the Master Servicer
Compensation and the Securities Administrator Compensation,
respectively;
(iii) to withdraw and return to the Master Servicer any amount
deposited in the Distribution Account and not required to be
deposited therein; and
(iv) to clear and terminate the Distribution Account upon
termination of the Agreement pursuant to Section 7.01 hereof.
(v) [Reserved].
Section 4.03 [Reserved].
Section 4.04 [Reserved].
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Section 4.05 Reports to Trustee and Certificateholders.
On each Distribution Date, the Securities Administrator shall have
prepared and shall make available to the Trustee, the Depositor, the Rating
Agencies and each Certificateholder a written report setting forth the following
information (on the basis of Mortgage Loan level information obtained from the
Master Servicer and the Servicers):
(a) the amount of the distributions, separately identified, with
respect to each Class of Certificates;
(b) the amount of the distributions set forth in the clause (a)
allocable to principal, separately identifying the aggregate amount of any
Principal Prepayments or other unscheduled recoveries of principal included in
that amount;
(c) the amount of the distributions set forth in the clause (a)
allocable to interest and how it was calculated;
(d) the amount of any unpaid Class Interest Shortfall and the related
accrued interest thereon, with respect to each Class of Certificates;
(e) the Class Principal Balance of each Class of Certificates after
giving effect to the distribution of principal on that Distribution Date;
(f) the aggregate Stated Principal Balance of the Mortgage Loans in
each Loan Group and in each Aggregate Loan Group at the end of the related
Prepayment Period, and the applicable Weighted Average Net Mortgage Rate of
each Loan Group, each Aggregate Loan Group and the Mortgage Pool at the
beginning of the related Due Period;
(g) the Senior Percentage and the Subordinated Percentage for each
Loan Group and for each Aggregate Loan Group for the following Distribution
Date;
(h) the Senior Prepayment Percentage and Subordinate Prepayment
Percentage for each Loan Group for the following Distribution Date;
(i) in the aggregate and with respect to each Loan Group, the amount
of the Servicing Fee paid to or retained by the Master Servicer and by each
Servicer, respectively, and in the aggregate with respect to each Loan Group;
(j) in the aggregate and with respect to each Loan Group, the amount
of Monthly Advances for the related Due Period;
(k) in the aggregate and with respect to each Loan Group, the number
and Stated Principal Balance of the Mortgage Loans that were (A) Delinquent
(exclusive of Mortgage Loans in foreclosure) (1) 30 to 59 days, (2) 60 to 89
days and (3) 90 or more days, (B) in foreclosure and Delinquent (1) 30 to 59
days, (2) 60 to 89 days and (3) 90 or more days and (C) in bankruptcy as of
the close of business on the last day of the calendar month preceding that
Distribution Date;
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(l) in the aggregate and with respect to each Loan Group, the total
number and principal balance of any REO properties as of the close of business
on the last day of the preceding Due Period;
(m) in the aggregate and with respect to each Loan Group, the amount
of Realized Losses incurred during the preceding calendar month;
(n) in the aggregate and with respect to each Loan Group, the
cumulative amount of Realized Losses incurred since the Closing Date;
(o) the Realized Losses, if any, allocated to each Class of
Certificates on that Distribution Date;
(p) the Class Principal Balance of each Class of Certificates after
giving effect to the distribution of principal on the Distribution Date;
(q) the Special Hazard Loss Coverage Amount, the Fraud Loss Coverage
Amount and the Bankruptcy Loss Coverage Amount, in each case as of the related
Determination Date;
(r) the Pass-Through Rate for each Class of Certificates for that
Distribution Date;
(s) the amount of any Transfer Payment Received paid to an
Undercollateralized Group or Transfer Payment Made by an Overcollateralized
Group pursuant to Section 5.08 hereof; and
(t) the total amount of Prepayment Penalties collected, as reported
by the Servicers.
The Securities Administrator shall make such reports available each
month via its website at xxxx://xxx.xxxxxxx.xxx. Assistance in using the website
may be obtained by calling the Securities Administrator's customer service desk
at (000) 000-0000. Certificateholders and other parties that are unable to use
the website are entitled to have a paper copy mailed to them via first class
mail by contacting the Securities Administrator and indicating such. In
preparing or furnishing the foregoing reports, the Securities Administrator
shall be entitled to rely conclusively on the accuracy of the information or
data regarding the Mortgage Loans and the related REO Properties that has been
provided to the Securities Administrator by the Master Servicer and the
Servicers, and neither the Trustee nor the Securities Administrator shall be
obligated to verify, recompute, reconcile or recalculate any such information or
data.
Upon the reasonable advance written request of any Certificateholder
that is a savings and loan, bank or insurance company, which request, if
received by the Trustee or any agent thereof, shall be promptly forwarded to the
Securities Administrator, the Securities Administrator shall provide, or cause
to be provided, (or, to the extent that such information or documentation is not
required to be provided by a Servicer under the applicable Purchase and
Servicing Agreement, shall use reasonable efforts to obtain such information and
documentation from such Servicer, and provide) to such Certificateholders such
reports and access to information and documentation regarding the Mortgage Loans
as such Certificateholders may reasonably deem necessary to comply with
applicable regulations of the Office of Thrift Supervision or its successor or
other regulatory authorities with respect to an investment in the
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Certificates; provided, however, that the Securities Administrator shall be
entitled to be reimbursed by such Certificateholders for the Securities
Administrator's actual expenses incurred in providing such reports and access.
ARTICLE V
DISTRIBUTIONS TO HOLDERS OF CERTIFICATES
Section 5.01 Distributions Generally.
(a) Subject to Section 7.01 respecting the final distribution on the
Certificates, on each Distribution Date the Securities Administrator or the
Paying Agent shall make all distributions in accordance with this Article V.
Such distributions shall be made by check mailed to each Certificateholder's
address as it appears on the Certificate Register of the Certificate Registrar
or, upon written request made to the Securities Administrator at least five
Business Days prior to the related Record Date by any Certificateholder owning
an aggregate initial Certificate Balance of at least $1,000,000, or in the
case of a Class of Interest-Only Certificates or Residual Certificate, a
Percentage Interest of not less than 100%, by wire transfer in immediately
available funds to an account specified in the request and at the expense of
such Certificateholder; provided, however, that the final distribution in
respect of any Certificate shall be made only upon presentation and surrender
of such Certificate at the Certificate Registrar's Corporate Trust Office;
provided, further, that the foregoing provisions shall not apply to any Class
of Certificates as long as such Certificate remains a Book-Entry Certificate
in which case all payments made shall be made through the Clearing Agency and
its Clearing Agency Participants. Notwithstanding the reduction of the Class
Principal Balance of any Class of Certificates to zero, such Class will be
outstanding hereunder (solely for the purpose of receiving distributions and
not for any other purpose) until the termination of the respective obligations
and responsibilities of the Depositor, the Master Servicer, the Securities
Administrator and the Trustee hereunder in accordance with Article VII. Wire
transfers will be made at the expense of the Holder requesting such wire
transfer by deducting a wire transfer fee from the related distribution.
Notwithstanding such final payment of principal of any of the Certificates,
each Residual Certificate will remain outstanding until the termination of
each REMIC and the payment in full of all other amounts due with respect to
the Residual Certificates and at such time such final payment in retirement of
any Residual Certificate will be made only upon presentation and surrender of
such Certificate at the Certificate Registrar's Corporate Trust Office. If any
payment required to be made on the Certificates is to be made on a day that is
not a Business Day, then such payment will be made on the next succeeding
Business Day.
(b) All distributions or allocations made with respect to the
Certificateholders within each Class on each Distribution Date shall be
allocated among the outstanding Certificates in such Class equally in
proportion to their respective initial Class Principal Balances or initial
Class Notional Amounts (or Percentage Interests).
Section 5.02 Priorities of Distribution.
(a) (1) With respect to Available Funds for Loan Group 1, on each
Distribution Date, the Securities Administrator shall withdraw the Available
Funds from the funds available
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therefor in the Distribution Account and apply such funds to distributions on
the specified Classes of Group 1 Senior Certificates in the following order
and priority and, in each case, to the extent of Available Funds remaining:
(i) [Reserved];
(ii) concurrently, to each interest-bearing Class of Group 1
Senior Certificates, an amount allocable to interest equal to the
related Class Optimal Interest Distribution Amount, any shortfall
being allocated among such Classes in proportion to the amount of the
Class Optimal Interest Distribution Amount that would have been
distributed in the absence of such shortfall; provided that prior to
an Accrual Termination Date, the related Accrual Amount shall be
distributed as provided in Section 5.02(a)(1)(iii);
(iii) the Accrual Amount shall be distributed in accordance with
the Accretion Direction Rule;
(iv) to each Class of Group 1 Senior Certificates, concurrently
as follows:
(x) [Reserved]; and
(y) on each Distribution Date prior to the Senior
Credit Support Depletion Date the related Principal Amount up
to the amount of the Senior Principal Distribution Amount for
Loan Group 1 for such Distribution Date will be distributed
sequentially, to the Class A-R and Class 1-A Certificates, in
that order, until their respective Class Principal Balances
are reduced to zero; and
(v) [Reserved];
(2) With respect to the Available Funds for Loan Group 2 on each Distribution
Date, the Securities Administrator shall withdraw such Available Funds from the
funds available therefor in the Distribution Account and apply such funds to
distributions on the specified Classes of Group 2 Senior Certificates in the
following order and priority and, in each case, to the extent of such Available
Funds remaining:
(i) [Reserved];
(ii) concurrently, to each interest-bearing Class of Group 2
Senior Certificates, an amount allocable to interest equal to the
related Class Optimal Interest Distribution Amount, any shortfall
being allocated among such Classes in proportion to the amount of the
Class Optimal Interest Distribution Amount, with respect to the Group
2 Senior Certificates that would have been distributed in the absence
of such shortfall; provided that prior to an Accrual Termination
Date, the related Accrual Amount shall be distributed as provided in
Section 5.02(a)(2)(iii);
(iii) [Reserved];
(iv) to each Class of Group 2 Senior Certificates, concurrently
as follows:
(x) [Reserved]; and
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(y) the related Principal Amount, up to the amount of
the Senior Principal Distribution Amount for Loan Group 2 for
such Distribution Date, will be distributed sequentially, to
the Class A-R and Class 2-A Certificates, in that order, until
their respective Class Principal Balances are reduced to zero;
(v) [Reserved];
(3) With respect to the Available Funds for Loan Group 3 on each Distribution
Date, the Securities Administrator shall withdraw such Available Funds from the
funds available therefor in the Distribution Account and apply such funds to
distributions on the specified Classes of Group 3 Senior Certificates in the
following order and priority and, in each case, to the extent of such Available
Funds remaining:
(i) [Reserved];
(ii) concurrently, to each interest-bearing Class of Group 3
Senior Certificates, an amount allocable to interest equal to the
related Class Optimal Interest Distribution Amount, any shortfall
being allocated among such Classes in proportion to the amount of the
Class Optimal Interest Distribution Amount, with respect to the Group
3 Senior Certificates that would have been distributed in the absence
of such shortfall; provided that prior to an Accrual Termination
Date, the related Accrual Amount shall be distributed as provided in
Section 5.02(a)(3)(iii);
(iii) [Reserved];
(iv) to each Class of Group 3 Senior Certificates,
concurrently as follows:
(x) [Reserved]; and
(y) the related Principal Amount, up to the amount of
the Senior Principal Distribution Amount for Loan Group 3 for
such Distribution Date, will be distributed to the Class 3-A
Certificates, until its Class Principal Balance is reduced to
zero; and
(v) [Reserved];
(4) With respect to the Available Funds for Loan Group 4 on each Distribution
Date, the Securities Administrator shall withdraw such Available Funds from the
funds available therefor in the Distribution Account and apply such funds to
distributions on the specified Classes of Group 4 Senior Certificates in the
following order and priority and, in each case, to the extent of such Available
Funds remaining:
(i) [Reserved];
(ii) concurrently, to each interest-bearing Class of Group
4 Senior Certificates, an amount allocable to interest equal to the
related Class Optimal Interest Distribution Amount, any shortfall
being allocated among such Classes in proportion to the amount of the
Class Optimal Interest Distribution Amount, with respect to the Group
4 Senior Certificates that would have been distributed in the absence
of such shortfall; provided
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that prior to an Accrual Termination Date, the related Accrual Amount
shall be distributed as provided in Section 5.02(a)(4)(iii);
(iii) [Reserved];
(iv) to each Class of Group 4 Senior Certificates,
concurrently as follows:
(x) [Reserved]; and
(y) the related Principal Amount, up to the amount
of the Senior Principal Distribution Amount for Loan Group 4
for such Distribution Date, will be distributed to the Class
4-A Certificates, until its Class Principal Balance is
reduced to zero; and
(v) [Reserved];
(5) With respect to the Available Funds for Loan Group 5 on each Distribution
Date, the Securities Administrator shall withdraw such Available Funds from the
funds available therefor in the Distribution Account and apply such funds to
distributions on the specified Classes of Group 5 Senior Certificates in the
following order and priority and, in each case, to the extent of such Available
Funds remaining:
(i) [Reserved];
(ii) concurrently, to each interest-bearing Class of Group
5 Senior Certificates, an amount allocable to interest equal to the
related Class Optimal Interest Distribution Amount, any shortfall
being allocated among such Classes in proportion to the amount of the
Class Optimal Interest Distribution Amount, with respect to the Group
5 Senior Certificates that would have been distributed in the absence
of such shortfall; provided that prior to an Accrual Termination
Date, the related Accrual Amount shall be distributed as provided in
Section 5.02(a)(5)(iii);
(iii) [Reserved];
(iv) to each Class of Group 5 Senior Certificates,
concurrently as follows:
(x) [Reserved]; and
(y) the related Principal Amount, up to the amount
of the Senior Principal Distribution Amount for Loan Group 5
for such Distribution Date, will be distributed to the Class
5-A Certificates, until its Class Principal Balance is
reduced to zero; and
(i) [Reserved];
(6) On each Distribution Date, after making the distributions described in
Section 5.02(a)(2), Section 5.02(a)(3),Section 5.02(a)(4) and Section
5.02(a)(5), Available Funds from each Loan Group in Aggregate Loan Group II
after making the distributions described in Section 5.02(a)(2),
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Section 5.02(a)(3),Section 5.02(a)(4) and Section 5.02(a)(5) will be
distributed to the Aggregate Group II Senior Certificates to the extent
provided in Section 5.08 hereof.
(7) I. On each Distribution Date, Available Funds from Loan Group 1 remaining
after making the distributions described in Section 5.02(a)(1) above will be
distributed to the Group 1 Subordinated Certificates, the Class P-1 Certificates
and the Class A-R Certificates in the following order and priority and, in each
case, to the extent of such funds remaining:
(A) to the Class 1-B-1 Certificates, an amount allocable to
interest equal to the Class Optimal Interest Distribution Amount for
such Class for such Distribution Date;
(B) to the Class 1-B-1 Certificates, an amount allocable to
principal equal to its Pro Rata Share for such Distribution Date
until the Class Principal Balance thereof is reduced to zero;
(C) to the Class 1-B-2 Certificates, an amount allocable to
interest equal to the Class Optimal Interest Distribution Amount for
such Class for such Distribution Date;
(D) to the Class 1-B-2 Certificates, an amount allocable to
principal equal to its Pro Rata Share for such Distribution Date
until the Class Principal Balance thereof is reduced to zero;
(E) to the Class 1-B-3 Certificates, an amount allocable to
interest equal to the amount of the Class Optimal Interest
Distribution Amount for such Class for such Distribution Date;
(F) to the Class 1-B-3 Certificates, an amount allocable to
principal equal to its Pro Rata Share for such Distribution Date
until the Class Principal Balance thereof is reduced to zero;
(G) to the Class 1-B-4 Certificates, an amount allocable to
interest equal to the amount of the Class Optimal Interest
Distribution Amount for such Class for such Distribution Date;
(H) to the Class 1-B-4 Certificates, an amount allocable to
principal equal to its Pro Rata Share for such Distribution Date
until the Class Principal Balance thereof is reduced to zero;
(I) to the Class 1-B-5 Certificates, an amount allocable to
interest equal to the Class Optimal Interest Distribution Amount for
such Class for such Distribution Date;
(J) to the Class 1-B-5 Certificates, an amount allocable to
principal equal to its Pro Rata Share for such Distribution Date
until the Class Principal Balance thereof is reduced to zero;
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(K) to the Class 1-B-6 Certificates, an amount allocable to
interest equal to the Class Optimal Interest Distribution Amount for
such Class for such Distribution Date; and
(L) to the Class 1-B-6 Certificates, an amount allocable to
principal equal to its Pro Rata Share for such Distribution Date
until the Class Principal Balance thereof is reduced to zero;
(M) [Reserved]; and
(N) to the Class A-R Certificates, any remaining funds in the
Trust Fund; provided, that such amounts shall not include the $100
held in trust for the Class P-1 Certificates.
II. On each Distribution Date, Available Funds from all of the Loan Groups in
Aggregate Loan Group II remaining after making the distributions described in
Section 5.02(a)(2), Section 5.02(a)(3),Section 5.02(a)(4),Section 5.02(a)(5) and
Section 5.02(a)(6) above, will be distributed to the Group II Subordinated
Certificates, the Class P-2 Certificates and the Class A-R Certificates in the
following order and priority and, in each case, to the extent of such funds
remaining:
(A) to the Class B-1 Certificates, an amount allocable to
interest equal to the Class Optimal Interest Distribution Amount for
such Class for such Distribution Date;
(B) to the Class B-1 Certificates, an amount allocable to
principal equal to its Pro Rata Share for such Distribution Date
until the Class Principal Balance thereof is reduced to zero;
(C) to the Class B-2 Certificates, an amount allocable to
interest equal to the Class Optimal Interest Distribution Amount for
such Class for such Distribution Date;
(D) to the Class B-2 Certificates, an amount allocable to
principal equal to its Pro Rata Share for such Distribution Date
until the Class Principal Balance thereof is reduced to zero;
(E) to the Class B-3 Certificates, an amount allocable to
interest equal to the amount of the Class Optimal Interest
Distribution Amount for such Class for such Distribution Date;
(F) to the Class B-3 Certificates, an amount allocable to
principal equal to its Pro Rata Share for such Distribution Date
until the Class Principal Balance thereof is reduced to zero;
(G) to the Class B-4 Certificates, an amount allocable to
interest equal to the amount of the Class Optimal Interest
Distribution Amount for such Class for such Distribution Date;
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(H) to the Class B-4 Certificates, an amount allocable to
principal equal to its Pro Rata Share for such Distribution Date
until the Class Principal Balance thereof is reduced to zero;
(I) to the Class B-5 Certificates, an amount allocable to
interest equal to the Class Optimal Interest Distribution Amount for
such Class for such Distribution Date;
(J) to the Class B-5 Certificates, an amount allocable to
principal equal to its Pro Rata Share for such Distribution Date
until the Class Principal Balance thereof is reduced to zero;
(K) to the Class B-6 Certificates, an amount allocable to
interest equal to the Class Optimal Interest Distribution Amount for
such Class for such Distribution Date; and
(L) to the Class B-6 Certificates, an amount allocable to
principal equal to its Pro Rata Share for such Distribution Date
until the Class Principal Balance thereof is reduced to zero;
(M) [Reserved]; and
(N) to the Class A-R Certificates, any remaining funds in the
Trust Fund; provided, that such amounts shall not include the $100
held in trust for the Class P-2 Certificates.
On each Distribution Date, all amounts representing Prepayment
Penalties on the Group 1 Mortgage Loans received by the Securities Administrator
with respect to the related Prepayment Period will be distributed to the holders
of the Class P-1 Certificates. On each Distribution Date, all amounts
representing Prepayment Penalties on the Aggregate Group II Mortgage Loans
received by the Securities Administrator with respect to the related Prepayment
Period will be distributed to the holders of the Class P-2 Certificates. On the
Distribution Date in (x) June 2010 with respect to the Class P-1 Certificates
and (y) May 2010 with respect to the Class P-2 Certificates, the $100 held in
trust for each of the Class P-1 and Class P-2 Certificates will be distributed
to the holders of the Class P-1 and Class P-2 Certificates, respectively.
(b) On each Distribution Date with respect to each Class or Component
of Accrual Certificates, the Accrual Amount for such Class or Component for
such Distribution Date shall not (except as provided in the second to last
sentence in this paragraph) be distributed as interest with respect to such
Class or Component of Accrual Certificates, but shall instead be added to the
related Class Principal Balance of such Class on the related Distribution
Date. With respect to any Distribution Date on which principal payments on any
Class or Component of Accrual Certificates are distributed pursuant to Section
5.02(a)(1)(iv)(y), Section 5.02(a)(2)(iv)(y), Section 5.02(a)(3)(iv)(y),
Section 5.02(a)(4)(iv)(y) or Section 5.02(a)(5)(iv)(y), as applicable, the
related Accrual Amount shall be deemed to have been added on such Distribution
Date to the related Class Principal Balance or Component Balance (and included
in the amount distributable on the related Class or Classes or Component of
Accretion Directed Certificates pursuant to Section 5.02(a)(1)(iii), Section
5.02(a)(2)(iii), Section 5.02(a)(3)(iii), Section 5.02(a)(4)(iii), or
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Section 5.02(a)(5)(iii), as applicable, for such Distribution Date) and the
related distribution thereon shall be deemed to have been applied
concurrently towards the reduction of all or a portion of the amount so added
and, to the extent of any excess, towards the reduction of the Class Principal
Balance or Component Balance of such Class or Component of Accrual
Certificates immediately prior to such Distribution Date.
(c) [reserved].
(d) On each Distribution Date, the amount referred to in clause (i)
of the definition of Class Optimal Interest Distribution Amount for each Class
of Certificates or Component thereof for such Distribution Date shall be
reduced for each Class or Component of Senior Certificates of a Senior
Certificate Group, each related Class of Subordinated Certificates by (i) the
related Class' pro rata share of the Net Prepayment Interest Shortfalls for
the related Loan Group based (x) with respect to a Class of Senior
Certificates or Component thereof, on the related Class Optimal Interest
Distribution Amount for such Distribution Date, and (y) (1) with respect to
the Group 1 Subordinated Certificates, the related Class Optimal Interest
Distribution Amount for such Distribution Date in the absence of such Net
Prepayment Interest Shortfalls and (2) with respect to the Group II
Subordinated Certificates on and prior to the third related Senior Termination
Date on the Assumed Interest Amount or after such related Senior Termination
Date, the related Class Optimal Interest Distribution Amount for such
Distribution Date in the absence of such Net Prepayment Interest Shortfalls,
and (ii) the related Class' Allocable Share of (A) after the related Special
Hazard Coverage Termination Date, with respect to each Mortgage Loan in the
related Loan Group (or after the related Senior Credit Support Depletion Date,
any Mortgage Loan in Loan Group 1 or any Mortgage Loan in Aggregate Loan Group
II, as applicable) that became a Special Hazard Mortgage Loan during the
calendar month preceding the month of such Distribution Date, the excess of
one month's interest at the related Adjusted Net Mortgage Rate on the Stated
Principal Balance of such Mortgage Loan as of the first day of the related Due
Period in such month over the amount of Liquidation Proceeds applied as
interest on such Mortgage Loan with respect to such month, (B) after the
related Bankruptcy Coverage Termination Date, with respect to each Mortgage
Loan in the related Loan Group (or after the related Senior Credit Support
Depletion Date, any Mortgage Loan in Loan Group 1 or any Mortgage Loan in
Aggregate Loan Group II, as applicable) that became subject to a Bankruptcy
Loss during the calendar month preceding the month of such Distribution Date,
the interest portion of the related Debt Service Reduction or Deficient
Valuation, (C) each Relief Act Reduction for the Mortgage Loans in the related
Loan Group (or after the related Senior Credit Support Depletion Date, any
Mortgage Loan in Loan Group 1 or any Mortgage Loan in Aggregate Loan Group II,
as applicable) incurred during the calendar month preceding the month of such
Distribution Date and (D) after the related Fraud Loss Coverage Termination
Date, with respect to each Mortgage Loan in the related Loan Group (or after
the related Senior Credit Support Depletion Date, any Mortgage Loan in Loan
Group 1 or any Mortgage Loan in Aggregate Loan Group II, as applicable) that
became a Fraud Loan during the calendar month preceding the month of such
Distribution Date, the excess of one month's interest at the related Adjusted
Net Mortgage Rate on the Stated Principal Balance of such Mortgage Loan as of
the related Due Period in such month over the amount of Liquidation Proceeds
applied as interest on such Mortgage Loan with respect to such month.
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(e) Notwithstanding the priority and allocation contained in Section
5.02(a)(7)I., if, on any Distribution Date, with respect to any Class of Group
1 Subordinated Certificates, the sum of the related Class Subordination
Percentages of such Class and of all Classes of Group 1 Subordinated
Certificates which have a higher numerical Class designation than such Class
(the "Applicable Credit Support Percentage") is less than the Original
Applicable Credit Support Percentage for such Class, no distribution of
Principal Prepayments will be made to any such Classes (the "Restricted
Classes") and the amount of such Principal Prepayments otherwise distributable
to the Restricted Classes shall be distributed to the outstanding Classes of
Group 1 Subordinated Certificates having lower numerical Class designations
than such Class, pro rata, based on their respective Class Principal Balances
immediately prior to such Distribution Date and shall be distributed in the
sequential order provided in Section 5.02(a)(7)I. Notwithstanding anything in
this Agreement to the contrary, the Class of Group 1 Subordinated Certificates
then outstanding with the highest distribution priority shall not be a
Restricted Class.
(f) Notwithstanding the priority and allocation contained in Section
5.02(a)(7)II., if, on any Distribution Date, with respect to any Class of
Group II Subordinated Certificates, the Applicable Credit Support Percentage
for a Class of Group II Subordinated Certificates is less than the Original
Applicable Credit Support Percentage for such Class, no distribution of
Principal Prepayments will be made to any such Classes (the "Restricted
Classes") and the amount of such Principal Prepayments otherwise distributable
to the Restricted Classes shall be distributed to the outstanding Classes of
Group II Subordinated Certificates having lower numerical Class designations
than such Class, pro rata, based on their respective Class Principal Balances
immediately prior to such Distribution Date and shall be distributed in the
sequential order provided in Section 5.02(a)(7)II. Notwithstanding anything in
this Agreement to the contrary, the Class of Group II Subordinated
Certificates then outstanding with the highest distribution priority shall not
be a Restricted Class.
(g) If Subsequent Recoveries have been received with respect to a
Liquidated Mortgage Loan in an Aggregate Loan Group, the amount of such
Subsequent Recoveries will be applied sequentially, in the order of payment
priority, to increase the Class Principal Balance or Component Principal
Balance of each Class of Certificates or Component thereof related to that
Aggregate Loan Group to which Realized Losses have been allocated, but in each
case by not more than the amount of Realized Losses previously allocated to
that Class of Certificates or Component pursuant to Section 5.02. Holders of
such Certificates will not be entitled to any payment in respect of the Class
Optimal Interest Distribution Amount on the amount of such increases for any
Interest Accrual Period preceding the Distribution Date on which such increase
occurs. Any such increases shall be applied pro rata to the Certificate
Balance or Component Balance of each Certificate of such Class or Component
thereof.
Section 5.03 [Reserved].
Section 5.04 Allocation of Losses.
(a) On or prior to each Distribution Date, the Securities
Administrator shall aggregate the information provided by each Servicer with
respect to the total amount of Realized Losses, including Excess Losses,
experienced on the Mortgage Loans for the related Distribution Date.
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(b) Realized Losses with respect to the Mortgage Loans in any Loan
Group on any Distribution Date shall be allocated as follows:
(i) [Reserved]; and
(ii) (A) any Realized Loss with respect to Loan Group 1 (other
than an Excess Loss) shall be allocated first to the Group 1
Subordinated Certificates in reverse order of their respective
numerical Class designations (beginning with the Class of Group 1
Subordinated Certificates then outstanding with the highest numerical
Class designation) until the respective Class Principal Balance of
each such Class is reduced to zero, and second to the Senior
Certificates (other than any Notional Amount Certificates, if
applicable), pro rata on the basis of their respective Class
Principal Balances or, in the case of any Class of Accrual
Certificates or Accrual Component, on the basis of the lesser of
their Class Principal Balance or Component Balance, as applicable,
and their initial Class Principal Balance or Component Balance, as
applicable, in each case immediately prior to the related
Distribution Date until the respective Class Principal Balance of
each such Class is reduced to zero; provided, that any Realized
Losses on the Group 1 Mortgage Loans that would otherwise be
allocated to the Class 1-A-2A Certificates will instead be allocated
to the Class 1-A-2B Certificates, until its Class Principal Balance
is reduced to zero;
(B) any Excess Losses on the Mortgage Loans in Loan Group 1
shall be allocated to the Classes of Certificates of the related Senior
Certificate Group (other than any Notional Amount Certificates) and the
Group 1 Subordinated Certificates on the basis of their respective
initial Class Principal Balances or Component Balances, as applicable,
or in the case of any or in the case of any Class of Accrual
Certificates or Accrual Component, on the basis of the lesser of their
respective Class Principal Balance and their respective initial Class
Principal Balance or their respective Component Balance or their
respective initial Component Balance, as the case may be, in each case
immediately prior to the related Distribution Date, and (y) to the
Aggregate Group II Subordinated Certificates, to the extent set forth
in Section 5.04(g) hereof;
(C) any Realized Loss with respect to any Loan Group in
Aggregate Loan Group II (other than an Excess Loss) shall be allocated
first to the Aggregate Group II Subordinated Certificates in reverse
order of their respective numerical Class designations (beginning with
the Class of Aggregate Group II Subordinated Certificates then
outstanding with the highest numerical Class designation) until the
respective Class Principal Balance of each such Class is reduced to
zero, and second to the Senior Certificates (other than any Notional
Amount Certificates, if applicable), pro rata on the basis of their
respective Class Principal Balances or, in the case of any Class of
Accrual Certificates or Accrual Component, on the basis of the lesser
of their Class Principal Balance or Component Balance, as applicable,
and their initial Class Principal Balance or Component Balance, as
applicable, in each case immediately prior to the related Distribution
Date until the respective Class Principal Balance of each such Class is
reduced to zero; and
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(D) any Excess Losses on the Mortgage Loans in a Loan Group in
Aggregate Loan Group II shall be allocated to the Classes of
Certificates of the related Senior Certificate Group (other than any
Notional Amount Certificates) and the Aggregate Group II Subordinated
Certificates then outstanding, pro rata, on the basis of, with respect
to such Senior Certificates, their respective Class Principal Balances,
or in the case of any Class of Accrual Certificates or Accrual
Component, on the basis of the lesser of their respective Class
Principal Balance and their respective initial Class Principal Balance
or their respective Component Balance or their respective initial
Component Balance, as the case may be, in each case immediately prior
to the related Distribution Date and, with respect to each Class of
Aggregate Group II Subordinated Certificates, the applicable
Subordinated Portion for each such Class relating to the Loan Group in
Aggregate Loan Group II in which such Excess Loss occurs; provided,
however, on any Distribution Date after the third related Senior
Termination Date for a Senior Certificate Group in Aggregate
Certificate Group II, (i) any Bankruptcy Losses or Fraud Losses on the
Mortgage Loans in the related Loan Group shall be allocated pro rata to
all Classes and Components of Senior Certificates (other than any
Notional Amount Certificates, if applicable) in the related Senior
Certificate Group on the basis of their respective initial Class
Principal Balances or Component Balances, as applicable, or in the case
of any or in the case of any Class of Accrual Certificates or Accrual
Component, on the basis of the lesser of their respective Class
Principal Balance and their respective initial Class Principal Balance
or their respective Component Balance or their respective initial
Component Balance, as the case may be, in each case immediately prior
to the related Distribution Date, and (ii) any Excess Losses on the
Mortgage Loans in the related Loan Group shall be allocated pro rata to
(x) all Classes and Components of Senior Certificates (other than any
Notional Amount Certificates, if applicable) in the related Senior
Certificate Group on the basis of their respective initial Class
Principal Balances or Component Balances, as applicable, or in the case
of any or in the case of any Class of Accrual Certificates or Accrual
Component, on the basis of the lesser of their respective Class
Principal Balance and their respective initial Class Principal Balance
or their respective Component Balance or their respective initial
Component Balance, as the case may be, in each case immediately prior
to the related Distribution Date, and (y) to the Group 1 Subordinated
Certificates, to the extent set forth in Section 5.04(g) hereof;
(c) The Class Principal Balance of the Class of Group 1 Subordinated
Certificates and Aggregate Group II Subordinated Certificates, as applicable,
then outstanding with the highest numerical Class designation shall be reduced
on each Distribution Date by the amount, if any, by which the aggregate of the
Class Principal Balances of all outstanding Classes of Group 1 Certificates or
Aggregate Group II Certificates, as applicable (after giving effect to the
distribution of principal and the allocation of Realized Losses on such
Distribution Date), exceeds the aggregate Stated Principal Balance of the
Mortgage Loans in the related Aggregate Loan Group for the following
Distribution Date.
(d) Any Realized Loss allocated to a Class of Certificates or any
reduction in the Class Principal Balance of a Class of Certificates pursuant
to Section 5.04(b) above or Section 5.04(g) below shall be allocated among the
Certificates of such Class in proportion to their respective Certificate
Balances.
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(e) Any allocation of Realized Losses to a Certificate or to any
Component or any reduction in the Certificate Balance of a Certificate,
pursuant to Section 5.04(b) above or Section 5.04(g) below shall be
accomplished by reducing the Certificate Balance or Component Balance thereof,
as applicable, immediately following the distributions made on the related
Distribution Date in accordance with the definition of "Certificate Balance"
or "Component Balance," as the case may be. All Realized Losses or Excess
Losses allocated to a Class of Component Certificates will be allocated, pro
rata, to the related Components.
(f) For the avoidance of doubt, no Realized Losses on the Mortgage
Loans in any Loan Group shall be allocated to the Class P-1 or Class P-2
Certificates.
(g) On any Distribution Date after the Senior Credit Support
Depletion Date has occurred with respect to an Aggregate Certificate Group, if
a Bankruptcy Loss, Fraud Loss or Special Hazard Loss on a Mortgage Loan in the
related Aggregate Loan Group is allocated to the related Classes of Senior
Certificates, such a Bankruptcy Loss, Fraud Loss or Special Hazard Loss, as
applicable, will be allocated among such Senior Certificates and the most
subordinate outstanding Class of Subordinated Certificates related to the
other Aggregate Loan Group, pro rata, based on their respective Class
Principal Balances immediately prior to such Distribution Date; provided,
however, that any such Bankruptcy Loss, Fraud Loss or Special Hazard Loss, as
applicable, allocated to such Subordinated Certificates will not exceed the
remaining Bankruptcy Loss Coverage Amount, Fraud Loss Coverage Amount or
Special Hazard Loss Coverage Amount, respectively, for such other Aggregate
Loan Group.
Section 5.05 Advances by the Master Servicer.
If any Servicer fails to remit any Advance required to be made under
the applicable Purchase and Servicing Agreement, the Master Servicer shall
itself make, or shall cause the successor Servicer to make, such Advance. If
the Master Servicer determines that an Advance is required, it shall on the
Business Day preceding the related Distribution Date immediately following
such Determination Date remit to the Securities Administrator from its own
funds (or funds advanced by the applicable Servicer) for deposit in the
Distribution Account immediately available funds in an amount equal to such
Advance. The Master Servicer and each Servicer shall be entitled to be
reimbursed for all Advances made by it. Notwithstanding anything to the
contrary herein, in the event the Master Servicer determines in its reasonable
judgment that an Advance is non-recoverable, the Master Servicer shall be
under no obligation to make such Advance. If the Master Servicer determines
that an Advance is non-recoverable, it shall, on or prior to the related
Distribution Date, deliver an Officer's Certificate to the Trustee and the
Securities Administrator to such effect.
Section 5.06 Compensating Interest Payments.
The amount of compensation payable to the Securities Administrator in
respect of the Mortgage Loans and any Distribution Date shall be reduced (but
not below zero) by the amount of any aggregate Compensating Interest Payment
from the Servicers for such Distribution Date, but only to the extent that
Prepayment Interest Shortfalls relating to such Distribution Date are required
to be paid by the Servicers pursuant to the Purchase and Servicing Agreements,
as
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amended by the Acknowledgements, but are not actually paid by the Servicer.
Such amount shall not be treated as an Advance and shall not be reimbursable.
Section 5.07 [Reserved].
Section 5.08 Cross-Collateralization; Adjustments to Available Funds.
(a) With respect to the Aggregate Group II Certificates, on each
Distribution Date after the first related Senior Termination Date but prior to
the earlier of the related Senior Credit Support Depletion Date and the third
related Senior Termination Date, the Securities Administrator shall distribute
the principal portion of Available Funds on the Aggregate Group II Mortgage
Loans relating to the Senior Certificates that will have been paid in full to
the holders of the Aggregate Group II Senior Certificates of the other
Certificate Groups in Aggregate Certificate Group II, pro rata, based on Class
Principal Balances, provided, however, that the Securities Administrator shall
not make such distribution on such Distribution Date if (a) the Aggregate
Subordinated Percentage for the Group II Subordinated Certificates for such
Distribution Date is greater than or equal to 200% of such Aggregate
Subordinated Percentage as of the Closing Date and (b) the average aggregate
Stated Principal Balance of the Aggregate Group II Mortgage Loans delinquent
60 days or more over the last six months, as a percentage of the Class
Principal Balance of the Aggregate Group II Subordinated Certificates, is less
than 50%.
(b) If on any Distribution Date the aggregate Class Principal Balance
of Senior Certificates in a Senior Certificate Group in Aggregate Certificate
Group II is greater than the aggregate Stated Principal Balance of the
Mortgage Loans in the related Loan Group (the "Undercollateralized Group(s)")
at the end of the Prepayment Period related to the immediately preceding
Distribution Date, then the Securities Administrator shall apply the Available
Funds of the other Loan Group(s) in Aggregate Loan Group II that is not
undercollateralized (the "Overcollateralized Group"), as follows:
(i) to add to the Available Funds of the Undercollateralized
Group an amount equal to the lesser of (a) one month's interest on
the Transfer Payment Received of the Undercollateralized Group at the
Weighted Average Mortgage Rate (minus the weighted average Expense
Fee Rate) applicable to the Undercollateralized Group(s) and (b)
Available Funds of the Overcollateralized Group(s) remaining after
making distributions to the Certificates of the Overcollateralized
Group(s) on such Distribution Date pursuant to Section 5.02; and
(ii) to the Senior Certificates of each Undercollateralized
Group in Aggregate Certificate Group II, to the extent of the
principal portion of Available Funds of the Overcollateralized
Group(s) in Aggregate Certificate Group II remaining after making
distributions to the Senior Certificates of the Overcollateralized
Group(s) on such Distribution Date pursuant to Section 5.02, until
the Class Principal Balance of the Senior Certificates of such
Undercollateralized Group(s) in Aggregate Certificate Group II equals
the aggregate Stated Principal Balance of the Mortgage Loans in the
related Loan Group(s), any shortfall of such Available Funds to be
allocated among such Undercollateralized Group(s), pro rata, based
upon the respective Transfer Payments.
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(c) The payment received by the Undercollateralized Group is referred
to as a "Transfer Payment Received." The payment made by the
Overcollateralized Group is referred to as a "Transfer Payment Made."
If more than one Overcollateralized Group exists in Aggregate
Certificate Group II on any Distribution Date, reductions in the Available Funds
of such Loan Groups in Aggregate Loan Group II to make the payments required to
be made pursuant to Section 5.08(b) on such Distribution Date shall be made pro
rata, based on the Class Principal Balance of the related Senior Certificates.
Section 5.09 Determination of Pass-Through Rates for LIBOR
Certificates.
(a) On each Interest Determination Date so long as any LIBOR
Certificates are outstanding, the Securities Administrator will determine
LIBOR on the basis of the British Bankers' Association ("BBA") "Interest
Settlement Rate" for one-month deposits in U.S. dollars as found on Telerate
page 3750 as of 11:00 a.m. London time on each LIBOR Determination Date.
"Telerate Page 3750" means the display page currently so designated on the
Moneyline Telerate Service (formerly the Dow Xxxxx Markets) (or such other
page as may replace that page on that service for the purpose of displaying
comparable rates or prices).
(b) If on any Interest Determination Date, LIBOR cannot be determined
as provided in paragraph (a) of this Section 5.09, the Securities
Administrator shall either (i) request each Reference Bank to inform the
Securities Administrator of the quotation offered by its principal London
office for making one-month United States dollar deposits in leading banks in
the London interbank market, as of 11:00 a.m. (London time) on such Interest
Determination Date or (ii) in lieu of making any such request, rely on such
Reference Bank quotations that appear at such time on the Reuters Screen LIBOR
Page (as defined in the International Swap Dealers Association Inc. Code of
Standard Wording, Assumptions and Provisions for Swaps, 1986 Edition), to the
extent available. LIBOR for the next Interest Accrual Period will be
established by the Securities Administrator on each interest Determination
Date as follows:
(i) If on any Interest Determination Date two or more Reference
Banks provide such offered quotations, LIBOR for the next applicable
Interest Accrual Period shall be the arithmetic mean of such offered
quotations (rounding such arithmetic mean upwards if necessary to
the nearest whole multiple of 1/32%).
(ii) If on any Interest Determination Date only one or none of
the Reference Banks provides such offered quotations, LIBOR for the
next Interest Accrual Period shall be whichever is the higher of (i)
LIBOR as determined on the previous Interest Determination Date or
(ii) the Reserve Interest Rate. The "Reserve Interest Rate" shall be
the rate per annum which the Securities Administrator determines to
be either (i) the arithmetic mean (rounded upwards if necessary to
the nearest whole multiple of 1/32%) of the one-month United States
dollar lending rates that New York City banks selected by the
Securities Administrator are quoting, on the relevant Interest
Determination Date, to the principal London offices of at least two
of the Reference Banks to which such quotations are, in the opinion
of the Securities Administrator, being so made, or (ii) in the event
that the Securities Administrator can determine no such arithmetic
mean, the lowest
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one-month United States dollar lending rate which New York City banks
selected by the Securities Administrator are quoting on such Interest
Determination Date to leading European banks.
(iii) (A) If on any Interest Determination Date the Securities
Administrator is required but is unable to determine the Reserve
Interest Rate in the manner provided in paragraph (b) above, LIBOR
for the related Classes of Certificates shall be LIBOR as determined
on the preceding applicable Interest Determination Date or (B) in
the case of the first Interest Determination Date, LIBOR shall be
2.420%.
Until all of the LIBOR Certificates are paid in full, the Securities
Administrator will at all times retain at least four Reference Banks for the
purpose of determining LIBOR with respect to each Interest Determination Date.
The Securities Administrator initially shall designate the Reference Banks. Each
"Reference Bank" shall be a leading bank engaged in transactions in Eurodollar
deposits in the international Eurocurrency market, shall not control, be
controlled by, or be under common control with, the Securities Administrator and
shall have an established place of business in London. If any such Reference
Bank should be unwilling or unable to act as such or if the Master Servicer
should terminate its appointment as Reference Bank, the Securities Administrator
shall promptly appoint or cause to be appointed another Reference Bank. The
Securities Administrator shall have no liability or responsibility to any Person
for (i) the selection of any Reference Bank for purposes of determining LIBOR or
(ii) any inability to retain at least four Reference Banks which is caused by
circumstances beyond its reasonable control.
(c) The Pass-Through Rate for each Class of LIBOR Certificates for
each Interest Accrual Period shall be determined by the Securities
Administrator on each Interest Determination Date so long as the LIBOR
Certificates are outstanding on the basis of LIBOR and the respective formulae
appearing in footnotes corresponding to the LIBOR Certificates in the table
relating to the Certificates in the Preliminary Statement.
(d) In determining LIBOR, any Pass-Through Rate for the LIBOR
Certificates, any Interest Settlement Rate, or any Reserve Interest Rate, the
Securities Administrator may conclusively rely and shall be protected in
relying upon the offered quotations (whether written, oral or on the Dow Xxxxx
Markets) from the BBA designated banks, the Reference Banks or the New York
City banks as to LIBOR, the Interest Settlement Rate or the Reserve Interest
Rate, as appropriate, in effect from time to time. The Securities
Administrator shall not have any liability or responsibility to any Person for
(i) the selection of New York City banks for purposes of determining any
Reserve Interest Rate or (ii) its inability, following a good-faith reasonable
effort, to obtain such quotations from, the BBA designated banks, the
Reference Banks or the New York City banks or to determine such arithmetic
mean, all as provided for in this Section 5.09.
(e) The establishment of LIBOR and each Pass-Through Rate for the
LIBOR Certificates by the Securities Administrator shall (in the absence of
manifest error) be final, conclusive and binding upon each Holder of a
Certificate and the Securities Administrator.
Section 5.10 Reserve Fund.
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(a) On the Closing Date, the Securities Administrator shall establish
and maintain in the Trustee's name, in trust for the benefit of the holders of
the LIBOR Certificates and the Notional Amount Certificates, a Reserve Fund,
into which the Depositor shall, on such date, deposit, in the aggregate,
$10,000.00 of which $4,500 shall be deposited into the Class 1-X-1 Sub
Account, $4,500 shall be deposited into the Class 1-X-2 Sub Account and $1,000
shall be deposited into the Class 1-X-B Sub Account. The Reserve Fund shall be
an Eligible Account, and funds on deposit therein shall be held separate and
apart from, and shall not be commingled with, any other moneys, including,
without limitation, other moneys of the Trustee held pursuant to this
Agreement. The Reserve Fund shall not be an asset of any REMIC established
hereby.
(b) The Reserve Fund will be comprised of three Sub Accounts: "Class
1-X-1 Sub Account", "Class 1-X-2 Sub Account" and "Class 1-X-B Sub Account".
On each Distribution Date, (i) Current Interest that would otherwise be
distributable with respect to the Class 1-X-1 Certificates will be deposited
instead in the Class 1-X-1 Sub Account, (ii) Current Interest that would
otherwise be distributable with respect to the Class 1-X-2 Certificates will
be deposited instead in the Class 1-X-2 Sub Account and (iii) Current Interest
that would otherwise be distributable with respect to the Class 1-X-B
Certificates will be deposited instead in the Class 1-X-B Sub Account, in each
case, to the extent of the applicable Required Reserve Fund Deposit for such
Class.
(c) On any Distribution Date for which a Net WAC Shortfall exists
with respect to the Class 1-A-1, Class 1-A-2A or Class 1-A-2B Certificates
remaining unpaid after application of the amounts received in respect of the
Class 1-A Corridor Contract, the Securities Administrator shall withdraw, to
the extent of available funds therein, from the Class 1-X-2 Sub Account and
the Class 1-X-1 Sub Account, in that order, the amount of such Net WAC
Shortfall for distribution on such Distribution Date pursuant to Section
5.10(e) hereof.
(d) On any Distribution Date for which a Net WAC Shortfall exists
with respect to the Class 1-B-1, Class 1-B-2 or Class 1-B-3 Certificates
remaining unpaid after application of the amounts received in respect of the
Class 1-B-1 Corridor Contract, Class 1-B-2 Corridor Contract, and Class 1-B-3
Corridor Contract, respectively, the Securities Administrator shall withdraw,
to the extent of available funds therein, from the Class 1-X-B Sub Account the
amount of such Net WAC Shortfall for distribution on such Distribution Date
pursuant to Section 5.10(e) hereof.
(e) (i) On any Distribution Date for which a Net WAC Shortfall exists
with respect to the Class 1-A-1, Class 1-A-2A and Class 1-A-2B Certificates
remaining unpaid after application of payments received under the Class 1-A
Corridor Contract pursuant to Section 5.11(d) hereof, the Securities
Administrator will withdraw the amounts on deposit in the Class 1-X-2 Sub
Account and the Class 1-X-1 Sub Account, in that order, and distribute them to
the holders of the Class 1-A-1, Class 1-A-2A and Class 1-A-2B Certificates,
first, pro rata, based upon their respective Class Principal Balances and
then, pro rata, to the extent of any Net WAC Shortfalls remaining unpaid after
giving effect to clause first, of this Section 5.10(e)(i).
(ii) On any Distribution Date for which a Net WAC Shortfall exists
with respect to the Class 1-B-1, Class 1-B-2 and Class 1-B-3 Certificates
remaining unpaid after application of payments received under the related
Corridor Contract pursuant to Section 5.11(d) hereof, the
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Securities Administrator will withdraw the amounts on deposit in the Class
1-X-B Sub Account and distribute them sequentially, to the holders of the
Class 1-B-1, Class 1-B-2 and Class 1-B-3 Certificates, in that order, in an
amount up to their remaining respective accrued and unpaid Net WAC Shortfalls.
(f) Funds in each of the Sub Accounts shall be invested in Permitted
Investments as directed in writing by the applicable Notional Amount
Certificateholder. Any earnings on amounts in the Class 1-X-1 Sub Account
shall be for the benefit of the Class 1-X-1 Certificateholders; any earnings
on amounts in the Class 1-X-2 Sub Account shall be for the benefit of the
Class 1-X-2 Certificateholders; and any earnings on amounts in the Class 1-X-B
Sub Account shall be for the benefit of the Class 1-X-B Certificateholders.
The Notional Amount Certificates shall evidence ownership of the related Sub
Account for federal income tax purposes and the Holders thereof shall direct
the Securities Administrator, in writing, as to investment of amounts on
deposit therein. The applicable Notional Amount Certificateholder(s) shall be
liable for any losses incurred on such investments. In the absence of written
instructions from the applicable Notional Amount Certificateholder to the
Securities Administrator as to investment of funds on deposit in the related
Sub Account, such funds shall be invested in the Xxxxx Fargo Prime Investment
Money Market Fund. For all Federal income tax purposes, amounts transferred by
the Master REMIC to the Reserve Fund shall be treated as amounts distributed
by the Master REMIC to the applicable Notional Amount Certificateholders.
(g) If, immediately after any Distribution Date, the amount on
deposit in any Sub Account of the Reserve Fund exceeds the initial deposit
therein, the Securities Administrator will distribute such excess to the
Holders of the Certificates that deposited such amounts in the relevant Sub
Account pursuant to Section 5.10(b).
Upon termination of the Trust Fund any amounts remaining in the related
Sub Account shall be distributed to Xxxxxx Xxxxxxx & Co. Incorporated.
Section 5.11 The Corridor Contracts.
(a) The Depositor hereby directs the Securities Administrator, solely
in its capacity as Securities Administrator hereunder and not in its
individual capacity, to execute and deliver each of the Corridor Contracts
concurrently with the execution and delivery of this Agreement. Except as may
be directed in writing by the Depositor or by a majority in interest of the
Holders of a Class of Certificates that have the benefit of a Corridor
Contract, the Securities Administrator shall have no duty or responsibility to
enter into any other interest rate cap contract or agreement upon the
expiration or termination of any of the Corridor Contracts. The Corridor
Contracts will be assets of the Trust Fund but will not be assets of any
REMIC. The Securities Administrator shall deposit any amounts received from
the Corridor Contract Counterparty with respect to the Corridor Contracts into
the Reserve Fund.
(b) The Securities Administrator will prepare and deliver any notices
required to be delivered to the Corridor Contract Counterparty under any
Corridor Contract.
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(c) The Securities Administrator, on behalf of the Trustee shall
terminate the Corridor Contract Counterparty upon the occurrence of an event
of default under any Corridor Contract of which a Responsible Officer of the
Securities Administrator has actual knowledge.
(d) On each Distribution Date, following the distribution of any
amounts in respect of interest pursuant to Section 5.02(a)(1)(iii), with
respect to the Group 1 Senior Certificates and Section 5.02(a)(7)I.(A),
Section 5.02(a)(7)I.(C) and Section 5.02(a)(7)I.(E) with respect to the Class
1-B-1, Class 1-B-2 and Class 1-B-3 Certificates, respectively, the Securities
Administrator shall distribute amounts on deposit in the Reserve Fund from (a)
the Class 1-A Corridor Contract, to the holders of the Class 1-A-1, Class
1-A-2A and Class 1-A-2B Certificates, (b) the Class 1-B-1 Corridor Contract,
to the holders of the Class 1-B-1 Certificates, (c) the Class 1-B-2 Corridor
Contract to the holders of the Class 1-B-2 Certificates and (d) the Class
1-B-3 Corridor Contract, to the holders of the Class 1-B-2 Certificates, in
each case to the extent of any Net WAC Shortfalls allocated to such Classes of
Certificates. Amounts withdrawn from the Reserve Fund shall be distributed
sequentially as follows:
(i) from any Class 1-A Corridor Contract Payment on deposit in
the Reserve Fund with respect to that Distribution Date, an amount
equal to any unpaid remaining Net WAC Shortfall with respect to the
Class 1-A-1, Class 1-A-2A and Class 1-A-2B Certificates for that
Distribution Date, to the holders of the Class 1-A-1, Class 1-A-2A
and Class 1-A-2B Certificates, first, pro rata, based upon their
respective class principal balances and then, pro rata, to the extent
of any Net WAC Shortfalls remaining unpaid after giving effect to
clause first, above;
(ii) from any Class 1-B-1 Corridor Contract Payment on deposit
in the Reserve Fund with respect to that Distribution Date, an amount
equal to any unpaid remaining Net WAC Shortfall with respect to the
Class 1-B-1 Certificates for that Distribution Date, to the Class
1-B-1 Certificates;
(iii) from any Class 1-B-2 Corridor Contract Payment on deposit
in the Reserve Fund with respect to that Distribution Date, an amount
equal to any unpaid remaining Net WAC Shortfall with respect to the
Class 1-B-2 Certificates for that Distribution Date, to the Class
1-B-2 Certificates ;and
(iv) from any Class 1-B-3 Corridor Contract Payment on deposit
in the Excess Reserve Fund with respect to that Distribution Date, an
amount equal to any unpaid remaining Net WAC Shortfall with respect
to the Class 1-B-3 Certificates for that Distribution Date, to the
Class 1-B-3 Certificates.
To the extent that a Class of Group 1 Certificates receives interest in
excess of the Group 1 Net WAC, such interest shall be deemed to have been paid
to the Reserve Fund and then paid by the Reserve Fund to those
Certificateholders.
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ARTICLE VI
CONCERNING THE TRUSTEE AND
THE SECURITIES ADMINISTRATOR; EVENTS OF DEFAULT
Section 6.01 Duties of Trustee and the Securities Administrator.
(a) The Trustee, except during the continuance of an Event of
Default, and the Securities Administrator undertakes to perform such duties
and only such duties as are specifically set forth in this Agreement. Any
permissive right of the Trustee or the Securities Administrator provided for
in this Agreement shall not be construed as a duty of the Trustee or the
Securities Administrator. If an Event of Default has occurred and has not
otherwise been cured or waived, the Trustee or the Securities Administrator
shall exercise such of the rights and powers vested in it by this Agreement
and use the same degree of care and skill in their exercise as a prudent
Person would exercise or use under the circumstances in the conduct of such
Person's own affairs, unless the Trustee is acting as master servicer, in
which case it shall use the same degree of care and skill (in its capacity as
successor Master Servicer) as a master servicer hereunder.
(b) Each of the Trustee and the Securities Administrator, upon
receipt of all resolutions, certificates, statements, opinions, reports,
documents, orders or other instruments furnished to the Trustee or the
Securities Administrator which are specifically required to be furnished
pursuant to any provision of this Agreement, shall examine them to determine
whether they are in the form required by this Agreement; provided, however,
that neither the Trustee nor the Securities Administrator shall be responsible
for the accuracy or content of any such resolution, certificate, statement,
opinion, report, document, order or other instrument furnished by the Master
Servicer or any Servicer to the Trustee or the Securities Administrator
pursuant to this Agreement, and shall not be required to recalculate or verify
any numerical information furnished to the Trustee or the Securities
Administrator pursuant to this Agreement. Subject to the immediately preceding
sentence, if any such resolution, certificate, statement, opinion, report,
document, order or other instrument is found not to conform to the form
required by this Agreement in a material manner the Securities Administrator
shall take such action as it deems appropriate to cause the instrument to be
corrected, and if the instrument is not corrected to the Securities
Administrator 's satisfaction, the Securities Administrator will provide
notice thereof to the Certificateholders and will, at the expense of the Trust
Fund, which expense shall be reasonable given the scope and nature of the
required action, take such further action as directed by the
Certificateholders.
(c) Neither the Trustee nor the Securities Administrator shall have
any liability arising out of or in connection with this Agreement, except for
its negligence or willful misconduct. Notwithstanding anything in this
Agreement to the contrary, neither the Trustee nor the Securities
Administrator shall be liable for special, indirect or consequential losses or
damages of any kind whatsoever (including, but not limited to, lost profits).
No provision of this Agreement shall be construed to relieve the Trustee or
the Securities Administrator from liability for its own negligent action, its
own negligent failure to act or its own willful misconduct; provided, however,
that:
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(i) The Trustee shall not be personally liable with respect
to any action taken, suffered or omitted to be taken by it in good
faith in accordance with the direction of Holders of Certificates as
provided in Section 6.18 hereof;
(ii) For all purposes under this Agreement, the Trustee
shall not be deemed to have notice of any Event of Default unless a
Responsible Officer of the Trustee has actual knowledge thereof or
unless written notice of any event which is in fact such a default is
received by the Trustee at the Corporate Trust Office of the Trustee,
and such notice references the Holders of the Certificates and this
Agreement;
(iii) For all purposes under this Agreement, the Securities
Administrator shall not be deemed to have notice of any Event of
Default (other than resulting from a failure by the Master Servicer
(i) to remit funds (or to make Advances) or (ii) to furnish
information to the Securities Administrator when required to do so)
unless a Responsible Officer of the Securities Administrator has
actual knowledge thereof or unless written notice of any event which
is in fact such a default is received by the Securities Administrator
at the address provided in Section 11.07, and such notice references
the Holders of the Certificates and this Agreement;
(iv) No provision of this Agreement shall require the
Trustee or the Securities Administrator to expend or risk its own
funds or otherwise incur any financial liability in the performance
of any of its duties hereunder, or in the exercise of any of its
rights or powers, if it shall have reasonable grounds for believing
that repayment of such funds or indemnity reasonably satisfactory to
it against such risk or liability is not reasonably assured to it;
and none of the provisions contained in this Agreement shall in any
event require the Trustee or the Securities Administrator to perform,
or be responsible for the manner of performance of, any of the
obligations of the Master Servicer under this Agreement;
(v) Neither the Trustee nor the Securities Administrator
shall be responsible for any act or omission of the Master Servicer,
the Depositor, the Seller, any Servicer or any Custodian.
(d) The Trustee shall have no duty hereunder with respect to any
complaint, claim, demand, notice or other document it may receive or which may
be alleged to have been delivered to or served upon it by the parties as a
consequence of the assignment of any Mortgage Loan hereunder; provided,
however, that the Trustee shall promptly remit to the Master Servicer, upon
receipt any such complaint, claim, demand, notice or other document (i) which
is delivered to the Corporate Trust Office of the Trustee, (ii) of which a
Responsible Officer has actual knowledge, and (iii) which contains information
sufficient to permit the Trustee to make a determination that the real
property to which such document relates is a Mortgaged Property related to a
Mortgage Loan.
(e) Neither the Trustee nor the Securities Administrator shall be
personally liable with respect to any action taken, suffered or omitted to be
taken by it in good faith in accordance with the direction of the
Certificateholders of any Class holding Certificates which evidence, as to
such Class, Percentage Interests aggregating not less than 25% as to the time,
method and
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place of conducting any proceeding for any remedy available to the Trustee or
the Securities Administrator or exercising any trust or power conferred upon
the Trustee or the Securities Administrator, as applicable, under this
Agreement or the Acknowledgements.
(f) Neither the Trustee nor the Securities Administrator shall be
required to perform services under this Agreement, or to expend or risk its
own funds or otherwise incur financial liability for the performance of any of
its duties hereunder or the exercise of any of its rights or powers if there
is reasonable ground for believing that the timely payment of its fees and
expenses or the repayment of such funds or indemnity reasonably satisfactory
to it against such risk or liability is not reasonably assured to it, and none
of the provisions contained in this Agreement shall in any event require the
Trustee or the Securities Administrator, as applicable, to perform, or be
responsible for the manner of performance of, any of the obligations of the
Master Servicer or any Servicer under this Agreement or any Purchase and
Servicing Agreement except during such time, if any, as the Trustee shall be
the successor to, and be vested with the rights, duties, powers and privileges
of, the Master Servicer in accordance with the terms of this Agreement.
(g) The Trustee shall not be held liable by reason of any
insufficiency in the Distribution Account resulting from any investment loss
on any Permitted Investment included therein (except to the extent that the
Trustee is the obligor and has defaulted thereon).
(h) Neither the Trustee nor, except as otherwise provided herein, the
Securities Administrator shall have any duty (A) to see to any recording,
filing, or depositing of this Agreement or any agreement referred to herein or
any financing statement or continuation statement evidencing a security
interest, or to see to the maintenance of any such recording or filing or
depositing or to any rerecording, refiling or redepositing of any thereof, (B)
to see to any insurance, (C) to see to the payment or discharge of any tax,
assessment, or other governmental charge or any lien or encumbrance of any
kind owing with respect to, assessed or levied against, any part of the Trust
Fund other than from funds available in the Distribution Account, or (D) to
confirm or verify the contents of any reports or certificates of the Master
Servicer or any Servicer delivered to the Trustee or the Securities
Administrator pursuant to this Agreement believed by the Trustee or the
Securities Administrator, as applicable, to be genuine and to have been signed
or presented by the proper party or parties.
(i) Neither the Securities Administrator nor the Trustee shall be
liable in its individual capacity for an error of judgment made in good faith
by a Responsible Officer or other officers of the Trustee or the Securities
Administrator, as applicable, unless it shall be proved that the Trustee or
the Securities Administrator, as applicable, was negligent in ascertaining the
pertinent facts.
(j) Notwithstanding anything in this Agreement to the contrary,
neither the Securities Administrator nor the Trustee shall be liable for
special, indirect or consequential losses or damages of any kind whatsoever
(including, but not limited to, lost profits), even if the Trustee or the
Securities Administrator, as applicable, has been advised of the likelihood of
such loss or damage and regardless of the form of action.
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(k) Neither the Securities Administrator nor the Trustee shall be
responsible for the acts or omissions of the other, it being understood that
this Agreement shall not be construed to render them agents of one another, or
of any Servicer.
Section 6.02 Certain Matters Affecting the Trustee and the
Securities Administrator.
Except as otherwise provided in Section 6.01:
(i) Each of the Trustee and the Securities Administrator may
request, and may rely and shall be protected in acting or refraining
from acting upon any resolution, Officer's Certificate, certificate
of auditors or any other certificate, statement, instrument, opinion,
report, notice, request, consent, order, approval, bond or other
paper or document believed by it to be genuine and to have been
signed or presented by the proper party or parties;
(ii) Each of the Trustee and the Securities Administrator
may consult with counsel and any advice of its counsel or Opinion of
Counsel shall be full and complete authorization and protection in
respect of any action taken or suffered or omitted by it hereunder in
good faith and in accordance with such advice or Opinion of Counsel;
(iii) Neither the Trustee nor the Securities Administrator
shall be personally liable for any action taken, suffered or omitted
by it in good faith and reasonably believed by it to be authorized or
within the discretion or rights or powers conferred upon it by this
Agreement;
(iv) Unless an Event of Default shall have occurred and be
continuing, neither the Trustee nor the Securities Administrator
shall be bound to make any investigation into the facts or matters
stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, consent, order, approval, bond or
other paper or document, unless requested in writing to do so by the
Holders of at least a majority in Class Principal Balance (or
Percentage Interest) of each Class of Certificates; provided,
however, that, if the payment within a reasonable time to the Trustee
or the Securities Administrator, as applicable, of the costs,
expenses or liabilities likely to be incurred by it in the making of
such investigation is, in the opinion of the Trustee or the
Securities Administrator, as applicable, not reasonably assured to
the Trustee or the Securities Administrator by the security afforded
to it by the terms of this Agreement, the Trustee or the Securities
Administrator, as applicable, may require indemnity reasonably
satisfactory to it against such expense or liability or payment of
such estimated expenses from the Certificateholders as a condition to
proceeding. The reasonable expense thereof shall be paid by the party
requesting such investigation and if not reimbursed by the requesting
party shall be reimbursed to the Trustee or the Securities
Administrator, as applicable, by the Trust Fund;
(v) Each of the Trustee and the Securities Administrator may
execute any of the trusts or powers hereunder or perform any duties
hereunder either directly or by or through agents, custodians or
attorneys, which agents, custodians or attorneys shall have any and
all of the rights, powers, duties and obligations of the Trustee and
the Securities
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Administrator conferred on them by such appointment, provided that
each of the Trustee and the Securities Administrator shall continue
to be responsible for its duties and obligations hereunder to the
extent provided herein, and provided further that neither the Trustee
nor the Securities Administrator shall be responsible for any
misconduct or negligence on the part of any such agent or attorney
appointed with due care by the Trustee or the Securities
Administrator, as applicable;
(vi) Neither the Trustee nor the Securities Administrator
shall be under any obligation to exercise any of the trusts or powers
vested in it by this Agreement or the Acknowledgements or to
institute, conduct or defend any litigation hereunder or in relation
hereto, in each case at the request, order or direction of any of the
Certificateholders pursuant to the provisions of this Agreement,
unless such Certificateholders shall have offered to the Trustee or
the Securities Administrator, as applicable, security or indemnity
reasonably satisfactory to it against the costs, expenses and
liabilities which may be incurred therein or thereby;
(vii) The right of the Trustee and the Securities
Administrator to perform any discretionary act enumerated in this
Agreement shall not be construed as a duty, and neither the Trustee
nor the Securities Administrator shall be answerable for other than
its negligence or willful misconduct in the performance of such act;
(viii) Neither the Trustee nor the Securities Administrator
shall be required to give any bond or surety in respect of the
execution of the Trust Fund created hereby or the powers granted
hereunder; and
(ix) In order to comply with its duties under the U.S.A.
Patriot Act, the Trustee shall obtain and verify certain information
and documentation from the other parties to this Agreement,
including, but not limited to each such party's name, address and
other identifying information.
Section 6.03 Trustee and Securities Administrator Not Liable for
Certificates.
The Trustee and the Securities Administrator make no representations
as to the validity or sufficiency of this Agreement, any Purchase and
Servicing Agreement or Acknowledgement, any Corridor Contract or of the
Certificates (other than, in the case of the Securities Administrator, the
certificate of authentication on the Certificates) or of any Mortgage Loan, or
related document save that the Trustee and the Securities Administrator
represent that, assuming due execution and delivery by the other parties
hereto, this Agreement has been duly authorized, executed and delivered by it
and constitutes its valid and binding obligation, enforceable against it in
accordance with its terms except that such enforceability may be subject to
(A) applicable bankruptcy and insolvency laws and other similar laws affecting
the enforcement of the rights of creditors generally, and (B) general
principles of equity regardless of whether such enforcement is considered in a
proceeding in equity or at law. The Trustee and the
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Securities Administrator shall not be accountable for the use or application
by the Depositor of funds paid to the Depositor in consideration of the
assignment of the Mortgage Loans to the Trust Fund by the Depositor or for the
use or application of any funds deposited into the Distribution Account or any
other fund or account maintained with respect to the Certificates. The Trustee
and the Securities Administrator shall not be responsible for the legality or
validity of this Agreement or any other document or agreement described in
this Section 6.03 or the validity, priority, perfection or sufficiency of the
security for the Certificates issued or intended to be issued hereunder.
Neither the Trustee nor, except as otherwise provided herein, the Securities
Administrator shall have any responsibility for filing any financing or
continuation statement in any public office at any time or to otherwise
perfect or maintain the perfection of any security interest or lien granted to
it hereunder or to record this Agreement.
Section 6.04 Trustee and the Securities Administrator May Own
Certificates.
The Trustee and the Securities Administrator and any Affiliate or
agent of either of them in its individual or any other capacity may become the
owner or pledgee of Certificates and may transact banking and trust business
with the other parties hereto and their Affiliates with the same rights it
would have if it were not Trustee, Securities Administrator or such agent.
Section 6.05 Eligibility Requirements for Trustee.
The Trustee hereunder shall at all times be (i) an institution whose
accounts are insured by the FDIC, (ii) a corporation or national banking
association, organized and doing business under the laws of any State or the
United States of America, authorized under such laws to exercise corporate
trust powers, having a combined capital and surplus of not less than
$50,000,000 and subject to supervision or examination by federal or state
authority and (iii) not an Affiliate of the Master Servicer or any Servicer.
If such corporation or national banking association publishes reports of
condition at least annually, pursuant to law or to the requirements of the
aforesaid supervising or examining authority, then, for the purposes of this
Section, the combined capital and surplus of such corporation or national
banking association shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. In case at any
time the Trustee shall cease to be eligible in accordance with provisions of
this Section, the Trustee shall resign immediately in the manner and with the
effect specified in Section 6.06.
Section 6.06 Resignation and Removal of Trustee and the Securities
Administrator.
(a) The Trustee may at any time resign and be discharged from the
trust hereby created by giving written notice thereof to the Securities
Administrator, the Depositor and the Master Servicer. Upon receiving such
notice of resignation, the Depositor will promptly appoint a successor
trustee, by written instrument, one copy of which instrument shall be
delivered to the resigning Trustee, one copy to the successor trustee, one
copy to the Securities Administrator and one copy to the Master Servicer. If
no successor trustee shall have been so appointed and shall have accepted
appointment within 30 days after the giving of such notice of resignation, the
resigning Trustee may petition any court of competent jurisdiction for the
appointment of a successor trustee.
(b) If at any time (i) the Trustee shall cease to be eligible in
accordance with the provisions of Section 6.05 and shall fail to resign after
written request therefor by the Depositor, (ii) the Trustee shall become
incapable of acting, or shall be adjudged a bankrupt or insolvent, or a
receiver of the Trustee of its property shall be appointed, or any public
officer shall take charge
93
or control of the Trustee or of either of their property or affairs for the
purpose of rehabilitation, conservation or liquidation, (iii) a tax is imposed
or threatened with respect to the Trust Fund by any state in which the Trustee
or the Trust Fund held by the Trustee is located due to the location of the
Trustee, or (iv) the continued use of the Trustee would result in a
downgrading of the rating by any Rating Agency of any Class of Certificates
with a rating, then the Depositor shall remove the Trustee and the Depositor
shall appoint a successor trustee, acceptable to the Master Servicer by
written instrument, one copy of which instrument shall be delivered to the
Trustee so removed, one copy to the successor trustee, one copy to the
Securities Administrator and one copy to the Master Servicer.
(c) The Holders of more than 50% of the Class Principal Balance (or
Percentage Interest) of each Class of Certificates may at any time upon 30
days' written notice to the Trustee and to the Depositor remove the Trustee by
such written instrument, signed by such Holders or their attorney-in-fact duly
authorized, one copy of which instrument shall be delivered to the Depositor,
one copy to the Trustee, one copy to the Securities Administrator and one copy
to the Master Servicer; the Depositor shall thereupon appoint a successor
trustee in accordance with this Section.
(d) Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to any of the provisions of this Section shall
become effective upon acceptance of appointment by the successor trustee, as
provided in Section 6.07. If no successor trustee shall have been so appointed
and shall have accepted appointment within 30 days after such notice of
dismissal, the Trustee who received such notice of dismissal may petition any
court of competent jurisdiction for the appointment of a successor trustee.
(e) The Securities Administrator shall not resign except in
accordance with the provisions of Sections 9.06 and 9.07 hereof, to the same
extent that the Master Servicer is entitled to resign or assign or delegate,
as applicable, its duties hereunder.
(f) If at any time the Securities Administrator shall cease to be
eligible in accordance with the provisions of Section 9.10 hereof and shall
fail to resign after written request thereto by the Depositor, or if at any
time the Securities Administrator shall become incapable of acting, or shall
be adjudged as bankrupt or insolvent, or a receiver of the Securities
Administrator or of its property shall be appointed, or any public officer
shall take charge or control of the Securities Administrator or of its
property or affairs for the purpose of rehabilitation, conservation or
liquidation, or a tax is imposed with respect to the Trust Fund by any state
in which the Securities Administrator or the Trust Fund is located and the
imposition of such tax would be avoided by the appointment of a different
Securities Administrator, then the Depositor or the Trustee may remove the
Securities Administrator and appoint a successor securities administrator by
written instrument, in triplicate, one copy of which instrument shall be
delivered to the Securities Administrator so removed, one copy of which shall
be delivered to the Master Servicer and one copy to the successor securities
administrator.
(g) If no successor securities administrator shall have been
appointed and shall have accepted appointment within 60 days after Xxxxx Fargo
Bank, N.A., as Securities Administrator, ceases to be the securities
administrator pursuant to this Section 6.06, then the Trustee (as successor
Securities Administrator) shall perform the duties of the Securities
Administrator
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pursuant to this Agreement. The Trustee shall notify the Rating Agencies of
any change of the Securities Administrator. In such event, the Trustee shall
assume all of the rights and obligations of the Securities Administrator
hereunder arising thereafter except that the Trustee shall not be (i) liable
for losses of the predecessor Securities Administrator or any acts or
omissions of the predecessor Securities Administrator hereunder, (ii) deemed
to have made any representations and warranties of the Securities
Administrator made herein and (iii) subject to the same resignation
limitations as set forth in Section 9.06 hereof; provided, however, that the
Trustee (as successor securities administrator) shall not resign until a
successor securities administrator has accepted appointment pursuant to
Section 6.07 hereof. The Trustee shall not be accountable, shall have no
liability and makes no representation as to any acts or omissions hereunder of
the Securities Administrator until such time as the Trustee may be required to
act as successor Securities Administrator pursuant to this Section 6.06 and
thereupon only for the acts or omissions of the Trustee as successor
Securities Administrator. If the Trustee is unwilling, or unable, to act as
successor Securities Administrator, then, in such event, the Trustee may
appoint, or petition a court of competent jurisdiction to appoint a successor
Securities Administrator meeting the criteria set forth in Section 9.10
hereof. Such successor Securities Administrator shall be entitled to the
Securities Administrator Compensation.
(h) The Trustee as successor securities administrator shall be
entitled to be reimbursed for all reasonable costs and expenses associated
with the transfer of the duties of the Securities Administrator by the
predecessor Securities Administrator, including, without limitation, any costs
or expenses associated with the complete transfer of all securities
administrator data and the completion, correction or manipulation of such
securities administrator data as may be required by the Trustee as successor
securities administrator to correct any errors or insufficiencies in such
securities administrator data or otherwise to enable the Trustee or successor
securities administrator to perform the duties of the Securities Administrator
properly and effectively. If such costs are not paid by the predecessor
Securities Administrator, the Trustee shall pay such costs from the Trust
Fund.
(i) The Trustee, as successor Securities Administrator, as
compensation for its activities hereunder as successor Securities
Administrator, shall be entitled to retain or withdraw from the Distribution
Account an amount equal to the Securities Administrator Compensation.
(j) The Holders of Certificates entitled to at least 51% of the
Voting Rights may at any time remove the Securities Administrator and appoint
a successor securities administrator by written instrument or instruments, in
triplicate, signed by such Holders or their attorneys-in-fact duly authorized,
one complete set of which instruments shall be delivered by the successor
Securities Administrator to the Trustee, one complete set to the Securities
Administrator so removed and one complete set to the successor so appointed.
Notice of any removal of the Securities Administrator shall be given to each
Rating Agency by the successor securities administrator.
(k) Any resignation or removal of the Securities Administrator and
appointment of a successor securities administrator pursuant to any of the
provisions of this Section 6.06 or Section 9.06 shall become effective upon
acceptance by the successor securities administrator of appointment as
provided in Section 6.07 hereof.
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(l) If the Securities Administrator and the Master Servicer are the
same Person, any removal of the Master Servicer pursuant to an Event of
Default shall also result in the removal of the Securities Administrator and
require the appointment of a successor pursuant to this Section and Section
6.07.
(m) The Securities Administrator shall cooperate with the Trustee and
any successor securities administrator in effecting the termination of the
Securities Administrator's responsibilities and rights hereunder, providing to
the Trustee and successor securities administrator all documents and records
in electronic or other form reasonably requested by it to enable it to assume
the Securities Administrator's functions hereunder and for the transfer to the
Trustee or successor Securities Administrator of all amounts in the
Distribution Account or any other account or fund maintained by the Securities
Administrator with respect to the Trust Fund. Neither the Trustee nor the
Master Servicer, as applicable, nor any other successor, as applicable, shall
be deemed to be in default hereunder by reason of any failure to make, or any
delay in making, any distribution hereunder or any portion thereof caused by
(i) the failure of the predecessor Securities Administrator to deliver, or any
delay in delivering, cash, documents or records to it, (ii) the failure of the
predecessor Securities Administrator to cooperate as required by this
Agreement, (iii) the failure of the predecessor Securities Administrator to
deliver the related Mortgage Loan data as required by this Agreement or (iv)
restrictions imposed by any regulatory authority having jurisdiction over the
predecessor Securities Administrator. No successor securities administrator
shall be deemed to be in default hereunder by reason of any failure to make,
or any delay in making, any distribution hereunder or any portion thereof
caused by (i) the failure of the Master Servicer to deliver, or any delay in
delivering cash, documents or records to it related to such distribution, or
(ii) the failure of Trustee or the Master Servicer to cooperate as required by
this Agreement.
Section 6.07 Successor Trustee and Successor Securities
Administrator.
(a) Any successor trustee or successor securities administrator
appointed as provided in Section 6.06 shall execute, acknowledge and deliver
to the Depositor and to its predecessor trustee or predecessor securities
administrator, as applicable, an instrument accepting such appointment
hereunder, and thereupon the resignation or removal of the predecessor trustee
or predecessor securities administrator, as applicable, shall become effective
and such successor trustee or successor securities administrator, as
applicable, without any further act, deed or conveyance, shall become fully
vested with all the rights, powers, duties and obligations of its predecessor
hereunder, with like effect as if originally named as trustee or securities
administrator, as applicable, herein. The predecessor trustee or predecessor
securities administrator, as applicable, shall deliver to the successor
trustee or successor securities administrator, as applicable, all Trustee
Mortgage Files and documents and statements related to each Trustee Mortgage
File held by it hereunder, and shall duly assign, transfer, deliver and pay
over to the successor trustee the entire Trust Fund, together with all
necessary instruments of transfer and assignment or other documents properly
executed necessary to effect such transfer and such of the records or copies
thereof maintained by the predecessor trustee in the administration hereof as
may be requested by the successor trustee and shall thereupon be discharged
from all duties and responsibilities under this Agreement. In addition, the
Depositor and the predecessor trustee or predecessor securities administrator,
as applicable, shall execute and deliver such other instruments and do such
other things as may reasonably be required to
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more fully and certainly vest and confirm in the successor trustee or
successor securities administrator, as applicable, all such rights, powers,
duties and obligations.
(b) No successor trustee shall accept appointment as provided in this
Section unless at the time of such appointment such successor trustee shall be
eligible under the provisions of Section 6.05.
(c) Upon acceptance of appointment by a successor trustee or
successor securities administrator, as applicable, as provided in this
Section, the Master Servicer shall mail notice of the succession of such
trustee or securities administrator, as applicable, hereunder to all Holders
of Certificates at their addresses as shown in the Certificate Register and to
any Rating Agency. The costs of such mailing shall be borne by the Master
Servicer.
Section 6.08 Merger or Consolidation of Trustee or the Securities
Administrator.
Any Person into which the Trustee or Securities Administrator may be
merged or with which it may be consolidated, or any Person resulting from any
merger, conversion or consolidation to which the Trustee or Securities
Administrator shall be a party, or any Persons succeeding to the business of
the Trustee or Securities Administrator, shall be the successor to the Trustee
or Securities Administrator hereunder, without the execution or filing of any
paper or any further act on the part of any of the parties hereto, anything
herein to the contrary notwithstanding, provided that, in the case of the
Trustee, such Person shall be eligible under the provisions of Section 6.05.
Section 6.09 Appointment of Co-Trustee, Separate Trustee or
Custodian.
(a) Notwithstanding any other provisions hereof, at any time, the
Trustee, the Depositor or the Certificateholders evidencing more than 50% of
the Class Principal Balance (or Percentage Interest) of every Class of
Certificates shall have the power from time to time to appoint one or more
Persons, approved by the Trustee, to act either as co-trustees jointly with
the Trustee, or as separate trustees, or as custodians, for the purpose of
holding title to, foreclosing or otherwise taking action with respect to any
Mortgage Loan outside the state where the Trustee has its principal place of
business where such separate trustee or co-trustee is necessary or advisable
(or the Trustee has been advised by the Master Servicer that such separate
trustee or co-trustee is necessary or advisable) under the laws of any state
in which a property securing a Mortgage Loan is located or for the purpose of
otherwise conforming to any legal requirement, restriction or condition in any
state in which a property securing a Mortgage Loan is located or in any state
in which any portion of the Trust Fund is located. The separate Trustees,
co-trustees, or custodians so appointed shall be trustees or custodians for
the benefit of all the Certificateholders and shall have such powers, rights
and remedies as shall be specified in the instrument of appointment; provided,
however, that no such appointment shall, or shall be deemed to, constitute the
appointee an agent of the Trustee. The obligation of the Master Servicer to
make Advances pursuant to Section 5.05 hereof shall not be affected or
assigned by the appointment of a co-trustee.
(b) Every separate trustee, co-trustee, and custodian shall, to the
extent permitted by law, be appointed and act subject to the following
provisions and conditions:
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(i) all powers, duties, obligations and rights conferred
upon the Trustee in respect of the receipt, custody and payment of
moneys shall be exercised solely by the Trustee;
(ii) all other rights, powers, duties and obligations
conferred or imposed upon the Trustee shall be conferred or imposed
upon and exercised or performed by the Trustee and such separate
trustee, co-trustee, or custodian jointly, except to the extent that
under any law of any jurisdiction in which any particular act or acts
are to be performed the Trustee shall be incompetent or unqualified
to perform such act or acts, in which event such rights, powers,
duties and obligations, including the holding of title to the Trust
Fund or any portion thereof in any such jurisdiction, shall be
exercised and performed by such separate trustee, co-trustee, or
custodian;
(iii) no trustee or custodian hereunder shall be personally
liable by reason of any act or omission of any other trustee or
custodian hereunder; and
(iv) the Trustee may at any time, by an instrument in
writing executed by it, with the concurrence of the Depositor, accept
the resignation of or remove any separate trustee, co-trustee or
custodian, so appointed by it or them, if such resignation or removal
does not violate the other terms of this Agreement.
(c) Any notice, request or other writing given to the Trustee shall
be deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee, co-trustee or custodian shall refer to this
Agreement and the conditions of this Article VI. Each separate trustee and
co-trustee, upon its acceptance of the trusts conferred, shall be vested with
the estates or property specified in its instrument of appointment, either
jointly with the Trustee or separately, as may be provided therein, subject to
all the provisions of this Agreement, specifically including every provision
of this Agreement relating to the conduct of, affecting the liability of, or
affording protection to, the Trustee. Every such instrument shall be filed
with the Trustee and a copy given to the Master Servicer.
(d) Any separate trustee, co-trustee or custodian may, at any time,
constitute the Trustee its agent or attorney-in-fact with full power and
authority, to the extent not prohibited by law, to do any lawful act under or
in respect of this Agreement on its behalf and in its name. If any separate
trustee, co-trustee or custodian shall die, become incapable of acting, resign
or be removed, all of its estates, properties, rights, remedies and trusts
shall vest in and be exercised by the Trustee, to the extent permitted by law,
without the appointment of a new or successor trustee.
(e) No separate trustee, co-trustee or custodian hereunder shall be
required to meet the terms of eligibility as a successor trustee under Section
6.05 hereunder and no notice to the Certificateholders of the appointment
shall be required under Section 6.07 hereof.
(f) The Securities Administrator on behalf of the Trustee agrees to
instruct the co-trustees, if any, to the extent necessary to fulfill the
Trustee's obligations hereunder.
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(g) The Trust shall pay the reasonable compensation of the
co-trustees (which compensation shall not reduce any compensation payable to
the Trustee under such Section).
Section 6.10 Authenticating Agents.
(a) The Trustee may appoint one or more Authenticating Agents which
shall be authorized to act on behalf of the Trustee in authenticating
Certificates. The Securities Administrator is hereby appointed as initial
Authenticating Agent, and the Securities Administrator accepts such
appointment. Wherever reference is made in this Agreement to the
authentication of Certificates by the Trustee or the Trustee's certificate of
authentication, such reference shall be deemed to include authentication on
behalf of the Trustee by an Authenticating Agent and a certificate of
authentication executed on behalf of the Trustee by an Authenticating Agent.
Each Authenticating Agent must be a corporation organized and doing business
under the laws of the United States of America or of any state, having a
combined capital and surplus of at least $15,000,000, authorized under such
laws to do a trust business and subject to supervision or examination by
federal or state authorities.
(b) Any Person into which any Authenticating Agent may be merged or
converted or with which it may be consolidated, or any Person resulting from
any merger, conversion or consolidation to which any Authenticating Agent
shall be a party, or any Person succeeding to the corporate agency business of
any Authenticating Agent, shall continue to be the Authenticating Agent
without the execution or filing of any paper or any further act on the part of
the Trustee or the Authenticating Agent.
(c) Any Authenticating Agent may at any time resign by giving at
least 30 days' advance written notice of resignation to the Trustee and the
Depositor. The Trustee may at any time terminate the agency of any
Authenticating Agent by giving written notice of termination to such
Authenticating Agent and the Depositor. Upon receiving a notice of resignation
or upon such a termination, or in case at any time any Authenticating Agent
shall cease to be eligible in accordance with the provisions of this Section
6.10, the Trustee may appoint a successor authenticating agent, shall give
written notice of such appointment to the Depositor and shall mail notice of
such appointment to all Holders of Certificates. Any successor authenticating
agent upon acceptance of its appointment hereunder shall become vested with
all the rights, powers, duties and responsibilities of its predecessor
hereunder, with like effect as if originally named as Authenticating Agent. No
successor authenticating agent shall be appointed unless eligible under the
provisions of this Section 6.10. No Authenticating Agent shall have
responsibility or liability for any action taken by it as such at the
direction of the Trustee.
Section 6.11 Indemnification of the Trustee and the Securities
Administrator.
The Trustee and the Securities Administrator and their respective
directors, officers, employees and agents shall be entitled to indemnification
from the Trust Fund for any loss, liability or expense (including the
reasonable compensation and the expenses and disbursements of its agents or
counsel), incurred without negligence or willful misconduct on their part,
arising out of, or in connection with, the acceptance or administration of the
trusts created hereunder or under the Purchase and Servicing Agreements, the
Acknowledgements, the Custodial Agreements, or the Corridor Contracts or in
connection with the performance of their duties
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hereunder or thereunder including the costs and expenses of defending
themselves against any claim in connection with the exercise or performance of
any of their powers or duties hereunder or thereunder, provided that:
(i) with respect to any such claim, the Trustee or the
Securities Administrator, as applicable, shall have given the
Depositor written notice thereof promptly after the Trustee, the
Securities Administrator, as applicable, shall have knowledge
thereof;
(ii) while maintaining control over its own defense, the
Trustee or the Securities Administrator, as applicable, shall
cooperate and consult fully with the Depositor in preparing such
defense; and
(iii) notwithstanding anything to the contrary in this
Section 6.11, the Trust Fund shall not be liable for settlement of
any such claim by the Trustee or the Securities Administrator, as
applicable, entered into without the prior consent of the Depositor,
which consent shall not be unreasonably withheld.
The provisions of this Section 6.11 shall survive any termination of
this Agreement and the resignation or removal of the Trustee or the Securities
Administrator, as applicable, and shall be construed to include, but not be
limited to any loss, liability or expense under any environmental law.
Section 6.12 Fees and Expenses of Securities Administrator and the
Trustee.
(a) Compensation for the services of the Master Servicer for its
duties hereunder with respect to the Mortgage Loans shall be paid by the
Securities Administrator. The Securities Administrator shall be compensated
for its duties hereunder pursuant to Section 4.02(b) hereof. The Securities
Administrator shall be entitled to all disbursements and advancements incurred
or made by the Securities Administrator in accordance with this Agreement
(including fees and expenses of its counsel and all persons not regularly in
its employment), except any such expenses arising from its negligence, bad
faith or willful misconduct.
(b) As compensation for its services hereunder, the Trustee and each
Custodian shall each be entitled to receive a fee (which, in the case of the
Trustee, shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust) which shall be paid by the
Master Servicer pursuant to a separate agreement between the Trustee, the
Custodians and the Master Servicer. Any expenses incurred by the Trustee or
the Custodians shall be reimbursed in accordance with Section 6.11.
Notwithstanding any provision in any Custodial Agreement to the contrary, the
parties hereto acknowledge and agree that (i) the Master Servicer shall only
be obligated to pay to each Custodian the fee agreed to by such Custodian and
the Master Servicer in the separate fee agreement referred to above, and (ii)
except as may be expressly set forth therein with respect to the Master
Servicer, in no event shall the Master Servicer have any responsibility or
liability for the payment of any other fees or any expenses or other amounts,
if any, that may be payable to a Custodian under the related Custodial
Agreement, all of which shall be payable in accordance with the terms and
conditions of such Custodial Agreement.
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Section 6.13 Collection of Monies.
Except as otherwise expressly provided in this Agreement, the
Securities Administrator on behalf of the Trustee may demand payment or delivery
of, and shall receive and collect, all money and other property payable to or
receivable by the Securities Administrator on behalf of the Trustee pursuant to
this Agreement. The Securities Administrator on behalf of the Trustee shall hold
all such money and property received by it as part of the Trust Fund and shall
distribute it as provided in this Agreement.
Section 6.14 Events of Default; Trustee To Act; Appointment of
Successor.
(a) The occurrence of any one or more of the following events shall
constitute an "Event of Default" with respect to the Master Servicer:
(i) Any failure by the Master Servicer to furnish the
Securities Administrator the Mortgage Loan data on the Mortgage Loans
sufficient to prepare the reports described in Section 4.05 which
continues unremedied for a period of one Business Day after the date
upon which written notice of such failure shall have been given to
the Master Servicer by the Trustee or the Securities Administrator or
to the Master Servicer, the Securities Administrator and the Trustee
by the Holders of not less than 25% of the Class Principal Balance of
each Class of Certificates affected thereby; or
(ii) Any failure on the part of the Master Servicer duly to
observe or perform in any material respect any other of the covenants
or agreements (other than those referred to in (vii) and (ix) below)
on the part of the Master Servicer contained in this Agreement which
continues unremedied for a period of 60 days after the date on which
written notice of such failure, requiring the same to be remedied,
shall have been given to the Master Servicer by the Trustee or the
Securities Administrator, or to the Master Servicer, the Securities
Administrator and the Trustee by the Holders of more than 50% of the
Aggregate Voting Interests of the Certificates; or
(iii) A decree or order of a court or agency or supervisory
authority having jurisdiction for the appointment of a conservator or
receiver or liquidator in any insolvency, readjustment of debt,
marshalling of assets and liabilities or similar proceedings, or for
the winding-up or liquidation of its affairs, shall have been entered
against the Master Servicer, and such decree or order shall have
remained in force undischarged or unstayed for a period of 60 days or
any Rating Agency reduces or withdraws or threatens to reduce or
withdraw the rating of the Certificates because of the financial
condition or loan servicing capability of such Master Servicer; or
(iv) The Master Servicer shall consent to the appointment of
a conservator or receiver or liquidator in any insolvency,
readjustment of debt, marshalling of assets and liabilities,
voluntary liquidation or similar proceedings of or relating to the
Master Servicer or of or relating to all or substantially all of its
property; or
(v) The Master Servicer shall admit in writing its inability
to pay its debts generally as they become due, file a petition to
take advantage of any applicable
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insolvency or reorganization statute, make an assignment for the
benefit of its creditors or voluntarily suspend payment of its
obligations; or
(vi) The Master Servicer shall be dissolved, or shall
dispose of all or substantially all of its assets, or consolidate
with or merge into another entity or shall permit another entity to
consolidate or merge into it, such that the resulting entity does not
meet the criteria for a successor servicer as specified in Section
9.05 hereof; or
(vii) If a representation or warranty set forth in Section
9.03 hereof shall prove to be incorrect as of the time made in any
respect that materially and adversely affects the interests of the
Certificateholders, and the circumstance or condition in respect of
which such representation or warranty was incorrect shall not have
been eliminated or cured within 90 days after the date on which
written notice of such incorrect representation or warranty shall
have been given to the Master Servicer by the Trustee or the
Securities Administrator, or to the Master Servicer, the Securities
Administrator and the Trustee by the Holders of more than 50% of the
Aggregate Voting Interests of the Certificates; or
(viii) A sale or pledge of any of the rights of the Master
Servicer hereunder or an assignment of this Agreement by the Master
Servicer or a delegation of the rights or duties of the Master
Servicer hereunder shall have occurred in any manner not otherwise
permitted hereunder and without the prior written consent of the
Trustee and Certificateholders holding more than 50% of the Aggregate
Voting Interests of the Certificates; or
(ix) After receipt of notice from the Trustee or the
Securities Administrator, any failure of the Master Servicer to make
any Advances required to be made by it hereunder; or
(x) Any failure by the Master Servicer to deposit in the
Distribution Account or remit to the Securities Administrator any
payment required to be made by the Master Servicer under the terms of
this Agreement, which failure shall continue unremedied for three
Business Days after the date upon which written notice of such
failure shall have been given to the Master Servicer by the
Securities Administrator, Trustee or the Depositor or to the Master
Servicer and the Trustee by the Holders of Certificates having not
less than 25% of the Voting Rights evidenced by the Certificates; or
(xi) If the Master Servicer and the Securities Administrator
are the same Person, any removal of the Securities Administrator
pursuant to Section 6.06.
If an Event of Default described in clauses (i) through (xi) of this
Section shall occur with respect to the Master Servicer, then, in each and every
case, subject to applicable law, so long as any such Event of Default shall not
have been remedied within any period of time prescribed by this Section, the
Trustee, by notice in writing to the Master Servicer may, and shall, if so
directed by Certificateholders evidencing more than 50% of the Class Principal
Balance of each Class of Certificates, terminate all of the respective rights
and obligations of the Master Servicer hereunder and in and to the Mortgage
Loans and the proceeds thereof. On or after the receipt by the Master Servicer
of such written notice, all authority and power of the Master Servicer, and
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with respect to the Master Servicer only in its capacity as Master Servicer
under this Agreement, whether with respect to the Mortgage Loans or otherwise,
shall pass to and be vested in the Trustee; and the Trustee is hereby
authorized and empowered to execute and deliver, on behalf of the defaulting
Master Servicer as attorney-in-fact or otherwise, any and all documents and
other instruments, and to do or accomplish all other acts or things necessary
or appropriate to effect the purposes of such notice of termination, whether
to complete the transfer and endorsement or assignment of the affected
Mortgage Loans and related documents or otherwise. The defaulting Master
Servicer agrees to cooperate with the Trustee and the Securities Administrator
in effecting the termination of the defaulting Master Servicer's
responsibilities and rights hereunder as Master Servicer which includes,
without limitation, notifying the Servicers of the assignment of the master
servicing function and providing the Trustee or its designee all documents and
records in electronic or other form reasonably requested by it to enable the
Trustee or its designee to assume the defaulting Master Servicer's functions
hereunder and the transfer to the Trustee for administration by it of all
amounts which shall at the time be or should have been deposited by the
defaulting Master Servicer in the Distribution Account, any related Custodial
Account and any other account or fund maintained with respect to the
Certificates or thereafter received with respect to the affected Mortgage
Loans. The Master Servicer being terminated shall bear all costs of the
transfer of the master servicing to the successor master servicer, including
but not limited to those of the Trustee or Securities Administrator reasonably
allocable to specific employees and overhead, legal fees and expenses,
accounting and financial consulting fees and expenses, and costs of amending
the Agreement, if necessary. If such costs are not paid by the terminated
Master Servicer, the Trustee shall pay such costs from the Trust Fund.
Notwithstanding the termination of its activities as Master Servicer,
any terminated Master Servicer shall continue to be entitled to reimbursement
under this Agreement to the extent such reimbursement relates to the period
prior to such Master Servicer's termination.
If any Event of Default shall occur, the Trustee, upon a Responsible
Officer of the Trustee becoming aware of the occurrence thereof, shall promptly
notify the Securities Administrator and each Rating Agency of the nature and
extent of such Event of Default. The Securities Administrator shall immediately
give written notice to the Master Servicer upon the failure of the Master
Servicer to make Advances as required under this Agreement with a copy to the
Trustee.
(b) On and after the time the Master Servicer receives a notice of
termination from the Trustee or the Securities Administrator, as applicable,
pursuant to Section 6.14(a) or the Trustee or the Securities Administrator, as
applicable, receives the resignation of the Master Servicer evidenced by an
Opinion of Counsel pursuant to Section 9.06, the Trustee, unless another
master servicer shall have been appointed, shall be the successor in all
respects to the Master Servicer, in its capacity as such under this Agreement
and the transactions set forth or provided for herein and shall have all the
rights and powers and be subject to all the responsibilities, duties and
liabilities relating thereto and arising thereafter placed on the Master
Servicer, hereunder, including the obligation to make Advances; provided,
however, that any failure to perform such duties or responsibilities caused by
the failure of the Master Servicer to provide information required by this
Agreement shall not be considered a default by the Trustee or the Securities
Administrator, as applicable, hereunder. In addition, neither the Trustee nor
the
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Securities Administrator, as applicable, shall have any responsibility for any
act or omission of the Master Servicer prior to the issuance of any notice of
termination. The Trustee shall have no liability relating to the
representations and warranties of the Master Servicer set forth in Section
9.03. In the capacity as such successor, the Trustee shall have the same
limitations on liability herein granted to the Master Servicer. As
compensation for being the successor master servicer, the Trustee shall be
entitled to receive all compensation payable to the Master Servicer under this
Agreement. Any successor to the Master Servicer hereunder also may assume the
obligations of the Securities Administrator hereunder as successor in such
capacity shall be entitled to the compensation payable to the Securities
Administrator pursuant to Section 4.02 hereof from and after the date of such
assumption.
(c) Notwithstanding the above, the Trustee may, if it shall be
unwilling to continue to so act, or shall, if it is unable to so act, petition
a court of competent jurisdiction to appoint, or appoint on its own behalf any
established housing and home finance institution servicer, master servicer,
servicing or mortgage servicing institution having a net worth of not less
than $15,000,000 and meeting such other standards for a successor master
servicer, as are set forth in this Agreement, as the successor to such Master
Servicer in the assumption of all of the respective responsibilities, duties
or liabilities of a master servicer, like the Master Servicer. Any entity
designated by the Trustee, may be an Affiliate of the Trustee; provided,
however, that, unless such Affiliate meets the net worth requirements and
other standards set forth herein for a successor master servicer, the Trustee,
in its individual capacity shall agree, at the time of such designation, to be
and remain liable to the Trust Fund for such Affiliate's actions and omissions
in performing its duties hereunder. In connection with such appointment and
assumption, the Trustee may make such arrangements for the compensation of
such successor out of payments on the Mortgage Loans as it and such successor
shall agree; provided, however, that no such compensation shall be in excess
of that permitted to the Master Servicer hereunder. The Trustee and such
successor shall take such actions, consistent with this Agreement, as shall be
necessary to effectuate any such succession and may make other arrangements
with respect to the master servicing to be conducted hereunder which are not
inconsistent herewith. The Master Servicer shall cooperate with the Trustee
and any successor master servicer in effecting the termination of the Master
Servicer's responsibilities and rights hereunder including, without
limitation, notifying the Servicers of the assignment of the master servicing
functions and providing the Trustee and successor master servicer all
documents and records in electronic or other form reasonably requested by it
to enable it to assume the Master Servicer's functions hereunder and the
transfer to the Trustee or such successor all amounts which shall at the time
be or should have been deposited by the Master Servicer in the Distribution
Account, any Custodial Account, or any other account or fund maintained with
respect to the Certificates or thereafter be received with respect to the
Mortgage Loans. Neither the Trustee nor the Securities Administrator, as
applicable, nor any other successor, as applicable, shall be deemed to be in
default hereunder by reason of any failure to make, or any delay in making,
any distribution hereunder or any portion thereof caused by (i) the failure of
the Master Servicer to deliver, or any delay in delivering, cash, documents or
records to it, (ii) the failure of the Master Servicer to cooperate as
required by this Agreement, (iii) the failure of the Master Servicer to
deliver the related Mortgage Loan data as required by this Agreement or (iv)
restrictions imposed by any regulatory authority having jurisdiction over the
Master Servicer. No successor master servicer shall be deemed to be in default
hereunder by reason of any failure to make, or any delay in making, any
distribution hereunder or any portion thereof caused by (i) the failure of the
Securities Administrator to
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deliver, or any delay in delivering cash, documents or records to it related
to such distribution, or (ii) the failure of Trustee or the Securities
Administrator to cooperate as required by this Agreement.
Section 6.15 Additional Remedies of Trustee Upon Event of Default.
During the continuance of any Event of Default, so long as such Event
of Default shall not have been remedied, the Trustee, in addition to the rights
specified in Section 6.14, shall have the right, in its own name and as trustee
of the Trust Fund, to take all actions now or hereafter existing at law, in
equity or by statute to enforce its rights and remedies and to protect the
interests, and enforce the rights and remedies, of the Certificateholders
(including the institution and prosecution of all judicial, administrative and
other proceedings and the filings of proofs of claim and debt in connection
therewith). Except as otherwise expressly provided in this Agreement, no remedy
provided for by this Agreement shall be exclusive of any other remedy, and each
and every remedy shall be cumulative and in addition to any other remedy, and no
delay or omission to exercise any right or remedy shall impair any such right or
remedy or shall be deemed to be a waiver of any Event of Default.
Section 6.16 Waiver of Defaults.
More than 50% of the Aggregate Voting Interests of the
Certificateholders may waive any default or Event of Default by the Master
Servicer in the performance of its obligations hereunder, except that a default
in the making of any required deposit to the Distribution Account that would
result in a failure of the Securities Administrator or the Paying Agent to make
any required payment of principal of or interest on the Certificates may only be
waived with the consent of 100% of the affected Certificateholders. Upon any
such waiver of a past default, such default shall cease to exist, and any Event
of Default arising therefrom shall be deemed to have been remedied for every
purpose of this Agreement. No such waiver shall extend to any subsequent or
other default or impair any right consequent thereon except to the extent
expressly so waived.
Section 6.17 Notification to Holders.
Upon termination of the Master Servicer or appointment of a successor
to the Master Servicer, in each case as provided herein, the Trustee shall
promptly mail notice thereof by first class mail to the Securities Administrator
and the Certificateholders at their respective addresses appearing on the
Certificate Register. The Trustee shall also, within 45 days after the
occurrence of any Event of Default known to the Trustee, give written notice
thereof to the Securities Administrator and the Certificateholders, unless such
Event of Default shall have been cured or waived prior to the issuance of such
notice and within such 45-day period.
Section 6.18 Directions by Certificateholders and Duties of Trustee
During Event of Default.
Subject to the provisions of Section 8.01 hereof, during the
continuance of any Event of Default, Holders of Certificates evidencing not less
than 25% of the Class Principal Balance (or Percentage Interest) of each Class
of Certificates affected thereby may direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or exercising
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any trust or power conferred upon the Trustee, under this Agreement; provided,
however, that the Trustee shall be under no obligation to pursue any such
remedy, or to exercise any of the trusts or powers vested in it by this
Agreement (including, without limitation, (i) the conducting or defending of
any administrative action or litigation hereunder or in relation hereto and
(ii) the terminating of the Master Servicer or any successor master servicer
from its rights and duties as master servicer hereunder) at the request, order
or direction of any of the Certificateholders, unless such Certificateholders
shall have offered to the Trustee security or indemnity reasonably
satisfactory to it against the cost, expenses and liabilities which may be
incurred therein or thereby; and, provided further, that, subject to the
provisions of Section 8.01, the Trustee shall have the right to decline to
follow any such direction if the Trustee, in accordance with an Opinion of
Counsel, determines that the action or proceeding so directed may not lawfully
be taken or if the Trustee in good faith determines that the action or
proceeding so directed would involve it in personal liability for which it is
not indemnified to its satisfaction.
Section 6.19 Action Upon Certain Failures of the Master Servicer and
Upon Event of Default.
In the event that a Responsible Officer of the Trustee shall have
actual knowledge or written notice of any action or inaction of the Master
Servicer that would become an Event of Default upon the Master Servicer's
failure to remedy the same after notice, the Trustee shall give notice thereof
to the Master Servicer.
Section 6.20 Preparation of Tax Returns and Other Reports.
(a) The Securities Administrator shall prepare or cause to be
prepared on behalf of the Trust Fund, based upon information calculated in
accordance with this Agreement pursuant to instructions given by the
Depositor, and the Securities Administrator shall file federal tax returns,
all in accordance with Article X hereof. If the Securities Administrator is
notified in writing that a state tax return or other return is required, then,
at the sole expense of the Trust Fund, the Securities Administrator shall
prepare and file such state income tax returns and such other returns as may
be required by applicable law relating to the Trust Fund, and, if required by
state law, shall file any other documents to the extent required by applicable
state tax law (to the extent such documents are in the Securities
Administrator's possession). The Securities Administrator shall forward copies
to the Depositor of all such returns and Form 1099 supplemental tax
information and such other information within the control of the Securities
Administrator as the Depositor may reasonably request in writing, and shall
forward to each Certificateholder such forms and furnish such information
within the control of the Securities Administrator as are required by the Code
and the REMIC Provisions to be furnished to them, and will prepare and forward
to Certificateholders Form 1099 (supplemental tax information) (or otherwise
furnish information within the control of the Securities Administrator) to the
extent required by applicable law. The Master Servicer will indemnify the
Securities Administrator and the Trustee for any liability of or assessment
against the Securities Administrator or the Trustee, as applicable, resulting
from any error in any of such tax or information returns directly resulting
from errors in the information provided by such Master Servicer except to the
extent that such information was provided in reasonable reliance upon
information from any Servicer.
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(b) The Securities Administrator shall prepare and file with the
Internal Revenue Service ("IRS"), on behalf of the Trust Fund and each REMIC
created hereunder, an application for an employer identification number on IRS
Form SS-4 or by any other acceptable method. The Securities Administrator
shall also file a Form 8811 as required. The Securities Administrator, upon
receipt from the IRS of the Notice of Taxpayer Identification Number Assigned,
shall upon request promptly forward a copy of such notice to the Trustee and
the Depositor. The Securities Administrator shall furnish any other
information that is required by the Code and regulations thereunder to be made
available to the Certificateholders. The Master Servicer agrees that it shall
cause each Servicer to, provide the Securities Administrator with such
information related to the Mortgage Loans in the possession of such Servicer,
as may reasonably be required for the Securities Administrator to prepare such
reports.
(c) Within 15 days after each Distribution Date, the Securities
Administrator shall, on behalf of the Trust and in accordance with industry
standards, file with the Securities and Exchange Commission (the "Commission")
via the Electronic Data Gathering and Retrieval System (XXXXX), a Form 8-K (or
any comparable form containing the same or comparable information or other
information mutually agreed upon) with a copy of the report to the
Certificateholders for such Distribution Date as an exhibit thereto. Prior to
Xxxxx 00, 0000 (xxx, if applicable, prior to March 30 of each year), the
Securities Administrator shall, on behalf of the Trust and in accordance with
industry standards, file with the Commission via XXXXX a Form 10-K with
respect to the Trust Fund. In addition, the Master Servicer will cause an
officer in charge of master servicing to execute the certification (the "Form
10-K Certification") required pursuant to Rule 13a-14 under the Securities
Exchange Act of 1934, as amended, and to file the same with the Commission
prior to Xxxxx 00, 0000 (xxx, if applicable, prior to March 30 of each year).
To the extent any information or exhibits required to be included in the Form
10-K are not timely received by the Securities Administrator prior to March
30, the Securities Administrator shall, on behalf of the Trust, file one or
more amended Form 10-Ks to include such missing information or exhibits
promptly after receipt thereof by the Securities Administrator. Promptly
following the first date legally permissible under applicable regulations and
interpretations of the Commission, the Securities Administrator shall, on
behalf of the Trust and in accordance with industry standards, file with the
Commission via XXXXX a Form 15 Suspension Notification with respect to the
Trust Fund, if applicable. The Master Servicer agrees to furnish to the
Securities Administrator promptly, from time to time upon request, such
further information, reports and financial statements within its control
related to this Agreement and the Mortgage Loans as the Securities
Administrator reasonably deems appropriate to prepare and file all necessary
reports with the Commission. The Securities Administrator shall have no
responsibility to file any items with the Commission other than those
specified in this section.
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ARTICLE VII
PURCHASE OF MORTGAGE LOANS AND
TERMINATION OF THE TRUST FUND
Section 7.01 Purchase of Mortgage Loans; Termination of Trust Fund
Upon Purchase or Liquidation of All Mortgage Loans.
(a) The respective obligations and responsibilities of the Trustee,
the Securities Administrator and the Master Servicer created hereby (other
than the obligation of the Securities Administrator to make payments to the
Certificateholders as set forth in Section 7.02), shall terminate on the
earliest of (i) the final payment or other liquidation of the last Mortgage
Loan remaining in the Trust Fund and the disposition of all REO Property, (ii)
the sale of the property held by the Trust Fund in accordance with both
Section 7.01(c)(i) and Section 7.01(c)(ii) and (iii) the Latest Possible
Maturity Date; provided, however, that in no event shall the Trust Fund
created hereby continue beyond the expiration of 21 years from the death of
the last survivor of the descendants of Xxxxxx X. Xxxxxxx, the late Ambassador
of the United States to the Court of St. James's, living on the date hereof.
Any termination of the Trust Fund shall be carried out in such a manner so
that the termination of each REMIC included therein shall qualify as a
"qualified liquidation" under the REMIC Provisions.
(b) [Reserved].
(c) In the event that the Master Servicer chooses to exercise its
optional termination rights it shall do so in accordance with the following:
(i) Optional Termination Related to the Group 1 Mortgage
Loans. On any Distribution Date occurring on or after the Initial
Optional Purchase Date related to the Group 1 Mortgage Loans, the
Master Servicer has the option to cause the Trust Fund to adopt a
plan of complete liquidation of the Group 1 Mortgage Loans pursuant
to Sections 7.02 and 7.03 hereof to sell all of the property related
thereto. If the Master Servicer elects to exercise such option, it
shall no later than 30 days prior to the Distribution Date selected
for purchase of the Group 1 Mortgage Loans and all other assets of
the Trust Fund related to the Group 1 Certificates (with respect to
the Group 1 Mortgage Loans, the "Purchase Date") deliver written
notice to the Trustee and the Securities Administrator and either (a)
deposit in the Distribution Account the related Redemption Price or
(b) state in such notice that the Redemption Price shall be deposited
in the Distribution Account not later than 10:00 a.m., New York City
time, on the applicable Purchase Date. Upon exercise of such option,
the property of the Trust Fund related to the Group 1 Mortgage Loans
shall be sold to the Master Servicer at a price equal to the related
Redemption Price.
(ii) Optional Termination Related to the Aggregate Group II
Mortgage Loans. On any Distribution Date occurring on or after the
Initial Optional Purchase Date related to the Aggregate Group II
Mortgage Loans, the Master Servicer has the option to cause the Trust
Fund to adopt a plan of complete liquidation of the Aggregate Group
II Mortgage Loans pursuant to Sections 7.02 and 7.03 hereof to sell
all of the property
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related thereto. If the Master Servicer elects to exercise such
option, it shall no later than 30 days prior to the Distribution Date
selected for purchase of the Aggregate Group II Mortgage Loans and
all other assets of the Trust Fund related to the Aggregate Group II
Certificates (with respect to the Aggregate Group II Mortgage Loans,
the "Purchase Date") deliver written notice to the Trustee and the
Securities Administrator and either (a) deposit in the Distribution
Account the related Redemption Price or (b) state in such notice that
the Redemption Price shall be deposited in the Distribution Account
not later than 10:00 a.m., New York City time, on the applicable
Purchase Date. Upon exercise of such option, the property of the
Trust Fund related to the Aggregate Group II Mortgage Loans shall be
sold to the Master Servicer at a price equal to the related
Redemption Price.
(d) The Depositor, the Master Servicer, each Servicer, the Securities
Administrator, the Trustee and the Custodian shall be reimbursed from the
related Redemption Price for any Advances, Servicer Advances, accrued and
unpaid Servicing Fees or other amounts with respect to the Mortgage Loans and
any related assets being purchased pursuant to Section 7.01(c) above that are
reimbursable to such parties (and such other amounts which, if not related to
the Mortgage Loans and other assets of the Trust Fund not being purchased,
that are then due and owing to any such Person) under this Agreement and the
related Purchase and Servicing Agreement or the related Custodial Agreement.
Section 7.02 Procedure Upon Redemption Termination of Trust Fund.
(a) Notice of any termination pursuant to the provisions of Section
7.01, specifying the Distribution Date upon which the final distribution shall
be made or the purchase of the Trust's assets related to the Group 1
Certificates or the Aggregate Group II Certificates, as applicable, will
occur, shall be given promptly by the Securities Administrator by first class
mail to the related Certificateholders mailed in the case of a redemption of
the related Certificates, no later than (i) the first day of the month in
which the Distribution Date selected for redemption of such Certificates shall
occur or (ii) upon (x) the sale of all of the property of the Trust Fund by
the Securities Administrator or in the case of a sale of assets of the Trust
Fund, or (y) upon the final payment or other liquidation of the last Mortgage
Loan or REO Property in the Trust Fund. Such notice shall specify (A) the
Initial Optional Purchase Date, Distribution Date upon which final
distribution on the related Certificates of all amounts required to be
distributed to Certificateholders pursuant to Section 5.02 will be made upon
presentation and surrender of the Certificates at the Certificate Registrar's
Corporate Trust Office, and (B) that the Record Date otherwise applicable to
such Distribution Date is not applicable, distribution being made only upon
presentation and surrender of the Certificates at the office or agency of the
Securities Administrator therein specified. The Securities Administrator shall
give such notice to the Trustee, the Master Servicer and the Certificate
Registrar at the time such notice is given to Holders of the Certificates.
Upon any such termination, the duties of the Certificate Registrar with
respect to the affected Certificates shall terminate and, in the event that
such termination is the second termination pursuant to Section 7.01, the
Securities Administrator shall terminate the Distribution Account and any
other account or fund maintained with respect to the Certificates, subject to
the Securities Administrator's obligation hereunder to hold all amounts
payable to Certificateholders in trust without interest pending such payment.
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(b) In the event that all of the Holders do not surrender their
Certificates for cancellation within three months after the time specified in
the above-mentioned written notice, the Securities Administrator shall give a
second written notice to the remaining Certificateholders to surrender their
Certificates for cancellation and receive the final distribution with respect
thereto. If within one year after the second notice any Certificates shall not
have been surrendered for cancellation, the Securities Administrator may take
appropriate steps to contact the remaining Certificateholders concerning
surrender of such Certificates, and the cost thereof shall be paid out of the
amounts distributable to such Holders. If within two years after the second
notice any Certificates shall not have been surrendered for cancellation, the
Securities Administrator shall deliver any remaining funds being held by it to
the Holder of the Class A-R Certificates and the Holder of the Class A-R
Certificates shall, subject to applicable state law relating to escheatment,
hold all amounts distributable to such Holders for the benefit of such
Holders. No interest shall accrue on any amount held by the Securities
Administrator and not distributed to a Certificateholder due to such
Certificateholder's failure to surrender its Certificate(s) for payment of the
final distribution thereon in accordance with this Section. The foregoing
provisions are intended to distribute to each Class of Certificates any
accrued and unpaid interest and/or principal to which they are entitled based
on their Pass-Through Rates and Class Certificate Balances or Notional Amounts
set forth in the Preliminary Statement upon liquidation of the Trust Fund.
(c) Any reasonable expenses incurred by the Securities Administrator
in connection with any purchase or termination or liquidation of the portion
of the Trust Fund related to the Group 1 Certificates or the Aggregate Group
II Certificates, as applicable, shall be reimbursed from proceeds received
from the liquidation of the Trust Fund.
Section 7.03 Additional Trust Fund Termination Requirements.
(a) On the termination of the Trust Fund under Section 7.01 (a), or
upon the exercise of the right to purchase all of the Group 1 Mortgage Loans
or the Aggregate Group II Mortgage Loans, as applicable, pursuant to Section
7.01(c), the Securities Administrator, on behalf of the Trustee, shall comply
with requirements of this Section 7.03 with respect to each Lower Tier REMIC
relating to the assets to be sold (the "Affected REMIC") and with respect to
the Certificates corresponding to the Affected REMIC (the "Corresponding
Certificates"), unless the party having the right to purchase the assets of
the Affected REMIC (the "Purchaser") delivers to the Trustee and the
Securities Administrator, an Opinion of Counsel (at the Master Servicer's
expense), addressed to the Trustee and the Securities Administrator to the
effect that the failure of the Trustee and the Securities Administrator to
comply with the requirements of this Section 7.03 will not result in an
Adverse REMIC Event:
Within 89 days prior to the time of making the final payment
on the Corresponding Certificates, (and upon notification by the Master
Servicer in the case of a purchase under Section 7.01(c)(i) or Section
7.01(c)(ii), as applicable) the Securities Administrator on behalf of
the Trustee shall adopt on behalf of the Affected REMIC, a plan of
complete liquidation, meeting the requirements of a qualified
liquidation under the REMIC Provisions;
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Any sale of the assets of the Affected REMIC shall be for cash
and shall occur at or after the time the plan of complete liquidation
is adopted and prior to the time the final payments on the
Corresponding Certificates are made;
On the date specified for final payment of the Corresponding
Certificates, the Securities Administrator shall make final
distributions of principal and interest on the Corresponding
Certificates in accordance with Section 5.02 and, after payment of, or
provision for any outstanding expenses, distribute or credit, or cause
to be distributed or credited, to the Holders of the Residual
Certificates all cash on hand after such final payment (other than cash
retained to meet claims), and the portion of the Trust Fund (and the
Affected REMIC) shall terminate at that time; and
(i) In no event may the final payment on the Corresponding
Certificates or the final distribution or credit to the Holders of
the Residual Certificates be made after the 89th day from the date on
which the plan of complete liquidation is adopted.
(b) By its acceptance of a Residual Certificate, each Holder thereof
hereby agrees to accept the plan of complete liquidation adopted by the
Securities Administrator on behalf of the Trustee under this Section and to
take such other action in connection therewith as may be reasonably requested
by the Trustee, the Securities Administrator or any Servicer.
ARTICLE VIII
RIGHTS OF CERTIFICATEHOLDERS
Section 8.01 Limitation on Rights of Holders.
(a) The death or incapacity of any Certificateholder shall not
operate to terminate this Agreement or this Trust Fund, nor entitle such
Certificateholder's legal representatives or heirs to claim an accounting or
take any action or proceeding in any court for a partition or winding up of
this Trust Fund, nor otherwise affect the rights, obligations and liabilities
of the parties hereto or any of them. Except as otherwise expressly provided
herein, no Certificateholder, solely by virtue of its status as a
Certificateholder, shall have any right to vote or in any manner otherwise
control the Master Servicer or the operation and management of the Trust Fund,
or the obligations of the parties hereto, nor shall anything herein set forth,
or contained in the terms of the Certificates, be construed so as to
constitute the Certificateholders from time to time as partners or members of
an association, nor shall any Certificateholder be under any liability to any
third person by reason of any action taken by the parties to this Agreement
pursuant to any provision hereof.
(b) No Certificateholder, solely by virtue of its status as
Certificateholder, shall have any right by virtue or by availing of any
provision of this Agreement to institute any suit, action or proceeding in
equity or at law upon or under or with respect to this Agreement, unless such
Holder previously shall have given to the Trustee a written notice of an Event
of Default and of the continuance thereof, as hereinbefore provided, and
unless also the Holders of Certificates evidencing not less than 25% of the
Class Principal Amount or Class Notional Amount (or Percentage Interest) of
Certificates of each Class affected thereby shall have made written
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request upon the Trustee to institute such action, suit or proceeding in its
own name as Trustee hereunder and shall have offered to the Trustee such
reasonable indemnity as it may require against the cost, expenses and
liabilities to be incurred therein or thereby, and the Trustee, for sixty days
after its receipt of such notice, request and offer of indemnity, shall have
neglected or refused to institute any such action, suit or proceeding and no
direction inconsistent with such written request has been given such Trustee
during such sixty-day period by such Certificateholders; it being understood
and intended, and being expressly covenanted by each Certificateholder with
every other Certificateholder, the Securities Administrator and the Trustee,
that no one or more Holders of Certificates shall have any right in any manner
whatever by virtue or by availing of any provision of this Agreement to
affect, disturb or prejudice the rights of the Holders of any other of such
Certificates, or to obtain or seek to obtain priority over or preference to
any other such Holder, or to enforce any right under this Agreement, except in
the manner herein provided and for the benefit of all Certificateholders. For
the protection and enforcement of the provisions of this Section, each and
every Certificateholder and the Trustee shall be entitled to such relief as
can be given either at law or in equity.
Section 8.02 Access to List of Holders.
(a) If the Trustee is not acting as Certificate Registrar, the
Certificate Registrar will furnish or cause to be furnished to the Trustee,
within fifteen days after receipt by the Certificate Registrar of a request by
the Trustee in writing, a list, in such form as the Trustee may reasonably
require, of the names and addresses of the Certificateholders of each Class as
of the most recent Record Date.
(b) If three or more Holders or Certificate Owners (hereinafter
referred to as "Applicants") apply in writing to the Certificate Registrar,
and such application states that the Applicants desire to communicate with
other Holders with respect to their rights under this Agreement or under the
Certificates and is accompanied by a copy of the communication which such
Applicants propose to transmit, then the Certificate Registrar shall, within
five Business Days after the receipt of such application, afford such
Applicants reasonable access during the normal business hours of the
Certificate Registrar to the most recent list of Certificateholders held by
the Certificate Registrar or shall, as an alternative, send, at the
Applicants' expense, the written communication proffered by the Applicants to
all Certificateholders at their addresses as they appear in the Certificate
Register.
(c) Every Holder or Certificate Owner, if the Holder is a Clearing
Agency, by receiving and holding a Certificate, agrees with the Depositor, the
Master Servicer, the Securities Administrator, the Certificate Registrar and
the Trustee that none of the Depositor, the Master Servicer, the Securities
Administrator, the Certificate Registrar nor the Trustee shall be held
accountable by reason of the disclosure of any such information as to the
names and addresses of the Certificateholders hereunder, regardless of the
source from which such information was derived.
Section 8.03 Acts of Holders of Certificates.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Agreement to be given or taken by
Holders or Certificate Owners, if the
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Holder is a Clearing Agency, may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Holders in person or
by agent duly appointed in writing; and, except as herein otherwise expressly
provided, such action shall become effective when such instrument or
instruments are delivered to the Trustee and the Securities Administrator and,
where expressly required herein, to the Master Servicer. Such instrument or
instruments (as the action embodies therein and evidenced thereby) are herein
sometimes referred to as an "Act" of the Holders signing such instrument or
instruments. Proof of execution of any such instrument or of a writing
appointing any such agents shall be sufficient for any purpose of this
Agreement and conclusive in favor of the Trustee, the Securities Administrator
and the Master Servicer, if made in the manner provided in this Section. Each
of the Trustee, the Securities Administrator and the Master Servicer shall
promptly notify the others of receipt of any such instrument by it, and shall
promptly forward a copy of such instrument to the others.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by the certificate of any notary public or other officer
authorized by law to take acknowledgments or deeds, certifying that the
individual signing such instrument or writing acknowledged to him the
execution thereof. Whenever such execution is by an officer of a corporation
or a member of a partnership on behalf of such corporation or partnership,
such certificate or affidavit shall also constitute sufficient proof of his
authority. The fact and date of the execution of any such instrument or
writing, or the authority of the individual executing the same, may also be
proved in any other manner which the Trustee deems sufficient.
(c) The ownership of Certificates (whether or not such Certificates
shall be overdue and notwithstanding any notation of ownership or other
writing thereon made by anyone other than the Trustee) shall be proved by the
Certificate Register, and none of the Trustee, the Securities Administrator,
the Master Servicer or the Depositor shall be affected by any notice to the
contrary. (d) Any request, demand, authorization, direction, notice, consent,
waiver or other action by the Holder of any Certificate shall bind every
future Holder of the same Certificate and the Holder of every Certificate
issued upon the registration of transfer thereof or in exchange therefor or in
lieu thereof, in respect of anything done, omitted or suffered to be done by
the Trustee or the Master Servicer in reliance thereon, whether or not
notation of such action is made upon such Certificate.
ARTICLE IX
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
BY THE MASTER SERVICER
Section 9.01 Duties of the Master Servicer; Enforcement of Servicers'
and Master Servicer's Obligations.
(a) The Master Servicer, on behalf of the Trustee, the Depositor and
the Certificateholders shall monitor the performance of the Servicers under
the Purchase and
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Servicing Agreements, and shall use its reasonable good faith efforts to cause
the Servicers duly and punctually to perform all of their respective duties
and obligations thereunder. Upon the occurrence of a default of which a
Responsible Officer of the Master Servicer has actual knowledge under a
Purchase and Servicing Agreement, the Master Servicer shall promptly notify
the Trustee thereof, and shall specify in such notice the action, if any, the
Master Servicer is taking in respect of such default. So long as any such
default shall be continuing, the Master Servicer may, and shall if it
determines such action to be in the best interests of Certificateholders, (i)
terminate all of the rights and powers of such Servicer pursuant to the
applicable provisions of the related Purchase and Servicing Agreement; (ii)
exercise any rights it may have to enforce the related Purchase and Servicing
Agreement against such Servicer; and/or (iii) waive any such default under the
related Purchase and Servicing Agreement or take any other action with respect
to such default as is permitted thereunder. Notwithstanding anything to the
contrary in this Agreement, with respect to any Additional Collateral Mortgage
Loan, the Master Servicer will have no duty or obligation to supervise,
monitor or oversee the activities of the related Servicer under any Purchase
and Servicing Agreement with respect to any Additional Collateral or under any
agreement relating to the pledge of, or the perfection of a pledge or security
interest in, any Additional Collateral except upon the occurrence of the
following events (i) in the case of a final liquidation of any Mortgaged
Property secured by Additional Collateral, the Master Servicer shall enforce
the obligation of the Servicer under the related Servicing Agreement to
liquidate such Additional Collateral as required by such Servicing Agreement,
and (ii) if the Master Servicer assumes the obligations of such Servicer as
successor Servicer under the related Servicing Agreement pursuant to this
Section 9.01, as successor Servicer, it shall be bound to service and
administer the Additional Collateral in accordance with the provisions of such
Servicing Agreement.
(b) Upon any termination by the Master Servicer of a Servicer's
rights and powers pursuant to its Purchase and Servicing Agreement, the rights
and powers of such Servicer with respect to the related Mortgage Loans shall
vest in the Master Servicer and the Master Servicer shall be the successor in
all respects to such Servicer in its capacity as Servicer with respect to such
Mortgage Loans under the related Purchase and Servicing Agreement, unless or
until the Master Servicer shall have appointed (and the Trustee shall have
acknowledged), with the consent of the Rating Agencies and in accordance with
the applicable provisions of the related Purchase and Servicing Agreement, a
new Xxxxxx Xxx- or FHLMC-approved Person to serve as successor to the
Servicer; provided, however, that it is understood and agreed by the parties
hereto that there will be a period of transition (not to exceed 90 days)
before the actual servicing functions can be fully transferred to a successor
servicer (including the Master Servicer). With such letter from the Rating
Agencies, the Master Servicer may elect to continue to serve as successor
servicer under the Purchase and Servicing Agreement. Upon appointment of a
successor servicer, as authorized under this Section 9.01(b), unless the
successor servicer shall have assumed the obligations of the terminated
Servicer under such Purchase and Servicing Agreement, the Master Servicer and
such successor servicer shall enter into a servicing agreement in a form
substantially similar to the affected Purchase and Servicing Agreement, and
the Trustee shall acknowledge such servicing agreement. In connection with any
such appointment, the Master Servicer may make such arrangements for the
compensation of such successor servicer as it and such successor servicer
shall agree, but in no event shall such compensation of any successor servicer
(including the Master Servicer) be in excess of that payable to the Servicer
under the affected Purchase and Servicing Agreement.
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The Master Servicer shall pay the costs of such enforcement (including
the termination of a Servicer, the appointment of a successor servicer or the
transfer and assumption of the servicing by the Master Servicer) at its own
expense and shall be reimbursed therefor initially (i) by the terminated
Servicer, (ii) from a general recovery resulting from such enforcement only to
the extent, if any, that such recovery exceeds all amounts due in respect of the
related Mortgage Loans, (iii) from a specific recovery of costs, expenses or
attorney's fees against the party against whom such enforcement is directed, or
(iv) to the extent that such amounts described in (i)-(iii) above are
insufficient to reimburse the Master Servicer for such costs of enforcement,
from the Trust Fund, as provided in Section 9.04.
If the Master Servicer assumes the servicing with respect to any of the
Mortgage Loans, it will not assume liability for the representations and
warranties of any Servicer it replaces or for the errors or omissions of such
Servicer.
If the Seller is the owner of the servicing rights and the Seller
chooses to terminate that Servicer with or without cause and sell those
servicing rights to a successor servicer, then the Depositor shall cause the
Seller to give reasonable prior written notice to the Master Servicer, and
obtain the prior written consent of the Rating Agencies and a New Xxxxxx Mae- or
FHLMC-approved Person reasonably acceptable to the Master Servicer shall be
chosen by the Seller and appointed as successor servicer with the acknowledgment
of the Master Servicer and the Trustee. The Depositor shall cause the costs of
such transfer (including any costs of the Master Servicer) to be borne by the
Seller.
(c) Upon any termination of a Servicer's rights and powers pursuant
to its Purchase and Servicing Agreement, the Master Servicer shall promptly
notify the Trustee and the Rating Agencies, specifying in such notice that the
Master Servicer or any successor servicer, as the case may be, has succeeded
such Servicer under the related Purchase and Servicing Agreement, which notice
shall also specify the name and address of any such successor servicer.
(d) The Depositor shall not consent to the assignment by any Servicer
of such Servicer's rights and obligations under the related Purchase and
Servicing Agreement without the prior written consent of the Master Servicer,
which consent shall not be unreasonably withheld.
(e) The Trustee shall execute and deliver, at the written request of
the Master Servicer or any Servicer, and furnish to the Master Servicer and
any Servicer, at the expense of the requesting party, a power of attorney in
the standard form provided by the Trustee to take title to the Mortgaged
Properties after foreclosure in the name of and on behalf of the Trustee and
for the purposes described herein to the extent necessary or desirable to
enable the Master Servicer or any Servicer to perform its respective duties.
The Trustee shall not be liable for the actions of the Master Servicer or any
Servicer under such powers of attorney.
Section 9.02 Assumption of Master Servicing by Trustee.
(a) In the event the Master Servicer shall for any reason no longer
be the Master Servicer (including by reason of any Event of Default by the
Master Servicer under this Agreement), the Trustee shall thereupon assume all
of the rights and obligations of such Master
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Servicer hereunder and under each Purchase and Servicing Agreement entered
into with respect to the Mortgage Loans or shall appoint or petition a court
to appoint a Xxxxxx-Xxx or FHLMC-approved servicer as successor servicer that
is acceptable to the Depositor and the Rating Agencies. The Trustee, as
successor master servicer, its designee or any successor master servicer
appointed by the Trustee shall be deemed to have assumed all of the Master
Servicer's interest herein and therein to the same extent as if such Purchase
and Servicing Agreements had been assigned to the assuming party, except that
the Master Servicer shall not thereby be relieved of any liability or
obligations of the Master Servicer under such Purchase and Servicing Agreement
accruing prior to its replacement as Master Servicer, and shall be liable to
the Trustee, and hereby agrees to indemnify and hold harmless the Trustee from
and against all costs, damages, expenses and liabilities (including reasonable
attorneys' fees) incurred by the Trustee as a result of such liability or
obligations of the Master Servicer and in connection with the Trustee's
assumption (but not its performance, except to the extent that costs or
liability of the Trustee are created or increased as a result of negligent or
wrongful acts or omissions of the Master Servicer prior to its replacement as
Master Servicer) of the Master Servicer's obligations, duties or
responsibilities thereunder.
(b) The Master Servicer that has been terminated shall, upon request
of the Trustee but at the expense of such Master Servicer, deliver to the
assuming party all documents and records relating to each Purchase and
Servicing Agreement, this Agreement and the related Mortgage Loans and an
accounting of amounts collected and held by it and otherwise use its best
efforts to effect the orderly and efficient transfer of each Purchase and
Servicing Agreement and this Agreement to the assuming party.
Section 9.03 Representations and Warranties of the Master Servicer.
The Master Servicer hereby represents and warrants to the Depositor,
the Securities Administrator and the Trustee, for the benefit of the
Certificateholders, as of the Closing Date that:
(i) it is validly existing and in good standing under the
laws of the United States of America as a national banking
association, and as Master Servicer has full power and authority to
transact any and all business contemplated by this Agreement and to
execute, deliver and comply with its obligations under the terms of
this Agreement, the execution, delivery and performance of which have
been duly authorized by all necessary corporate action on the part of
the Master Servicer;
(ii) the execution and delivery of this Agreement by the
Master Servicer and its performance and compliance with the terms of
this Agreement will not (A) violate the Master Servicer's charter or
bylaws, (B) violate any law or regulation or any administrative
decree or order to which it is subject or (C) constitute a default
(or an event which, with notice or lapse of time, or both, would
constitute a default) under, or result in the breach of, any material
contract, agreement or other instrument to which the Master Servicer
is a party or by which it is bound or to which any of its assets are
subject, which violation, default or breach would materially and
adversely affect the Master Servicer's ability to perform its
obligations under this Agreement;
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(iii) this Agreement constitutes, assuming due
authorization, execution and delivery hereof by the other respective
parties hereto, a legal, valid and binding obligation of the Master
Servicer, enforceable against it in accordance with the terms hereof,
except as such enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium and other laws affecting the enforcement
of creditors' rights in general, and by general equity principles
(regardless of whether such enforcement is considered in a proceeding
in equity or at law);
(iv) the Master Servicer is not in default with respect to
any order or decree of any court or any order or regulation of any
federal, state, municipal or governmental agency to the extent that
any such default would materially and adversely affect its
performance hereunder;
(v) the Master Servicer is not a party to or bound by any
agreement or instrument or subject to any charter provision, bylaw or
any other corporate restriction or any judgment, order, writ,
injunction, decree, law or regulation that may materially and
adversely affect its ability as Master Servicer to perform its
obligations under this Agreement or that requires the consent of any
third person to the execution of this Agreement or the performance by
the Master Servicer of its obligations under this Agreement;
(vi) no litigation is pending or, to the best of the Master
Servicer's knowledge, threatened against the Master Servicer which
would prohibit its entering into this Agreement or performing its
obligations under this Agreement;
(vii) the Master Servicer, or an affiliate thereof the
primary business of which is the servicing of conventional
residential mortgage loans, is a Xxxxxx Mae- or FHLMC-approved
seller/servicer;
(viii) no consent, approval, authorization or order of any
court or governmental agency or body is required for the execution,
delivery and performance by the Master Servicer of or compliance by
the Master Servicer with this Agreement or the consummation of the
transactions contemplated by this Agreement, except for such
consents, approvals, authorizations and orders (if any) as have been
obtained; and
(ix) the consummation of the transactions contemplated by
this Agreement are in the ordinary course of business of the Master
Servicer.
It is understood and agreed that the representations and warranties set
forth in this Section shall survive the execution and delivery of this
Agreement. The Master Servicer shall indemnify the Depositor, the Securities
Administrator and the Trustee and hold them harmless against any loss, damages,
penalties, fines, forfeitures, legal fees and related costs, judgments, and
other costs and expenses resulting from any claim, demand, defense or assertion
based on or grounded upon, or resulting from, a material breach of the Master
Servicer's representations and warranties contained in this Section 9.03. It is
understood and agreed that the enforcement of the obligation of the Master
Servicer set forth in this Section to indemnify the Depositor, the Securities
Administrator and the Trustee as provided in this Section constitutes the sole
remedy (other than
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as set forth in Section 6.14) of the Depositor, the Securities Administrator
and the Trustee, respecting a breach of the foregoing representations and
warranties. Such indemnification shall survive any termination of the Master
Servicer as Master Servicer hereunder, the resignation or removal of the
Trustee and any termination of this Agreement.
Any cause of action against the Master Servicer relating to or arising
out of the breach of any representations and warranties made in this Section
shall accrue upon discovery of such breach by either the Depositor, the Master
Servicer or the Trustee or notice thereof by any one of such parties to the
other parties.
Section 9.04 Compensation to the Master Servicer.
For so long as Xxxxx Fargo Bank, National Association is the
Master Servicer and the Securities Administrator, the Master Servicer shall be
entitled to be paid by the Securities Administrator reasonable compensation
for the Master Servicer's services hereunder in an amount to be agreed upon
between the Master Servicer and the Securities Administrator. Should Xxxxx
Fargo Bank, National Association no longer be both the Master Servicer and the
Securities Administrator, the Master Servicer shall be entitled to receive the
Master Servicer Compensation payable pursuant to Section 4.02(b)(ii) hereof.
The Master Servicer shall be entitled to be paid by the
Trust Fund, and either retain or withdraw from the Distribution Account (i)
amounts necessary to reimburse itself for any previously unreimbursed
Advances, Servicer Advances and Nonrecoverable Advances with respect to the
Mortgage Loans in accordance with the definition of "Available Funds" and (ii)
amounts representing assumption fees, late payment charges or other ancillary
income not included in the definition of "Available Funds" and which are not
required to be remitted by the Servicers to the Securities Administrator or
deposited by the Securities Administrator into the Distribution Account. The
Master Servicer shall be required to pay all expenses incurred by it in
connection with its activities hereunder and shall not be entitled to
reimbursement therefor except as provided in this Agreement.
In addition, the Master Servicer shall be entitled to reimbursement
from the Distribution Account for all reasonable expenses, disbursements and
advances incurred or made by the Master Servicer in connection with the
performance of its duties hereunder and under the Purchase and Servicing
Agreements, as modified by the Acknowledgements (including the reasonable
compensation and the expenses and disbursements of its agents and counsel), to
the extent not otherwise reimbursed pursuant to this Agreement, except any
such expense, disbursement or advance as may be attributable to its willful
misfeasance, bad faith or negligence.
The Master Servicer and any director, officer, employee or agent of
the Master Servicer shall be indemnified by the Trust and held harmless
thereby against any loss, liability or expense (including reasonable legal
fees and disbursements of counsel) incurred on their part that may be
sustained in connection with, arising out of, or related to, any claim or
legal action (including any pending or threatened claim or legal action)
relating to this Agreement, the Purchase and Servicing Agreements or the
Certificates, other than any loss, liability or expense resulting from
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the Master Servicer's failure to perform its duties hereunder or thereunder or
incurred by reason of the Master Servicer's negligence, willful misfeasance or
bad faith.
Section 9.05 Merger or Consolidation.
Any Person into which the Master Servicer may be merged or
consolidated, or any Person resulting from any merger, conversion, other change
in form or consolidation to which the Master Servicer shall be a party, or any
Person succeeding to the business of the Master Servicer shall be the successor
to the Master Servicer hereunder, without the execution or filing of any paper
or any further act on the part of any of the parties hereto, anything herein to
the contrary notwithstanding; provided, however, that the successor or resulting
Person to the Master Servicer shall be a Person that shall be qualified and
approved to service mortgage loans for Xxxxxx Xxx or FHLMC and shall have a net
worth of not less than $15,000,000.
Section 9.06 Resignation of Master Servicer and Securities
Administrator.
Except as otherwise provided in Sections 9.05, 9.07 and 9.10 hereof,
neither the Master Servicer nor the Securities Administrator shall resign from
the obligations and duties hereby imposed on it unless the duties of the Master
Servicer or the Securities Administrator, as applicable, hereunder are no longer
permissible under applicable law or are in material conflict by reason of
applicable law with any other activities carried on by it and cannot be cured.
Any such determination permitting the resignation of the Master Servicer or the
Securities Administrator shall be evidenced by an Opinion of Counsel that shall
be Independent to such effect delivered to the Trustee. No resignation of the
Master Servicer or the Securities Administrator shall become effective until the
Trustee shall have assumed, or a successor master servicer or successor
securities administrator, as applicable, shall have been appointed pursuant to
Section 6.07 or 9.02, as applicable, and until such successor shall have
assumed, such Master Servicer's or Securities Administrator's responsibilities
and obligations under this Agreement. Notice of any such resignation shall be
given promptly by the Master Servicer or the Securities Administrator, as
applicable, to the Depositor and the Trustee.
If, at any time, the Master Servicer resigns under this Section 9.06,
or transfers or assigns its rights and obligations under Section 9.07, or is
removed as Master Servicer pursuant to Section 6.14, then at such time Xxxxx
Fargo Bank, National Association (or any successor thereto) also shall resign or
be removed, as applicable, as Securities Administrator, Paying Agent,
Authenticating Agent and Certificate Registrar under this Agreement. In such
event, the obligations of the Master Servicer and the Securities Administrator
shall be assumed by the Trustee as successor or by such other successor master
servicer and/or securities administrator, as applicable, appointed by the
Trustee (subject to the provisions of Sections 6.07 and 9.02(a)).
Section 9.07 Assignment or Delegation of Duties by the Master
Servicer and Securities Administrator.
Except as expressly provided herein, neither the Master Servicer nor
the Securities Administrator shall assign or transfer any of their respective
rights, benefits or privileges hereunder to any other Person, or delegate to
or subcontract with, or authorize or appoint any other Person to perform any
of the respective duties, covenants or obligations to be performed by
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the Master Servicer or Securities Administrator, as applicable, hereunder;
provided, however, that the Master Servicer and the Securities Administrator
shall each have the right with the prior written consent of the Trustee and
the Depositor (which consent shall not be unreasonably withheld), and upon
delivery to the Trustee and the Depositor of a letter from each Rating Agency
to the effect that such action shall not result in a downgrading of the
Certificates, to delegate or assign to or subcontract with or authorize or
appoint any qualified Person to perform and carry out any of the respective
duties, covenants or obligations to be performed and carried out by the Master
Servicer or the Securities Administrator, as applicable, hereunder. Notice of
such permitted assignment shall be given promptly by the Master Servicer or
the Securities Administrator, as applicable, to the Depositor and the Trustee.
If, pursuant to any provision hereof, the respective duties of the Master
Servicer or the Securities Administrator are transferred to a successor master
servicer or successor securities administrator, as applicable, the entire
amount of the compensation payable to the Master Servicer or Securities
Administrator pursuant hereto shall thereafter be payable to such successor
master servicer or successor securities administrator. Such successor Master
Servicer shall also pay the fees of the Trustee, as provided herein.
Section 9.08 Limitation on Liability of the Master Servicer and
Others.
(a) Neither the Master Servicer nor any of the directors, officers,
employees or agents of the Master Servicer shall be under any liability to the
Trustee or the Certificateholders for any action taken or for refraining from
the taking of any action in good faith pursuant to this Agreement, or for
errors in judgment; provided, however, that this provision shall not protect
the Master Servicer or any such person against any liability that would
otherwise be imposed by reason of willful misfeasance, bad faith or negligence
in its performance of its duties or by reason of reckless disregard for its
obligations and duties under this Agreement. The Master Servicer and any
director, officer, employee or agent of the Master Servicer may rely in good
faith on any document of any kind prima facie properly executed and submitted
by any Person respecting any matters arising hereunder. The Master Servicer
shall be under no obligation to appear in, prosecute or defend any legal
action that is not incidental to its duties to master service the Mortgage
Loans in accordance with this Agreement and that in its opinion may involve it
in any expenses or liability; provided, however, that the Master Servicer may
in its sole discretion undertake any such action that it may deem necessary or
desirable in respect to this Agreement and the rights and duties of the
parties hereto and the interests of the Certificateholders hereunder. In such
event, the legal expenses and costs of such action and any liability resulting
therefrom shall be expenses, costs and liabilities of the Trust Fund and the
Master Servicer shall be entitled to be reimbursed therefor out of the
Distribution Account.
The Master Servicer shall not be liable for any acts or omissions of
the Servicers except to the extent that damages or expenses are incurred as a
result of such act or omissions and such damages and expenses would not have
been incurred but for the negligence, willful misfeasance, bad faith or
recklessness of the Master Servicer in supervising, monitoring and overseeing
the obligations of the Servicers in this Agreement and the Purchase and
Servicing Agreements.
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Section 9.09 Indemnification; Third-Party Claims.
The Master Servicer agrees to indemnify the Depositor, the
Securities Administrator and the Trustee, and hold them harmless against any and
all claims, losses, penalties, fines, forfeitures, legal fees and related costs,
judgments, and any other costs, liability, fees and expenses that the Depositor,
the Securities Administrator or the Trustee may sustain as a result of the
Master Servicer's willful misfeasance, bad faith or negligence in the
performance of its duties hereunder or by reason of its reckless disregard for
its obligations and duties under this Agreement, the Acknowledgements and the
related Purchase and Servicing Agreements. The Depositor, the Securities
Administrator and the Trustee shall immediately notify the Master Servicer if a
claim is made by a third party with respect to this Agreement or the Mortgage
Loans entitling the Depositor, the Securities Administrator or the Trustee to
indemnification under this Section 9.09(a), whereupon the Master Servicer shall
assume the defense of any such claim and pay all expenses in connection
therewith, including counsel fees, and promptly pay, discharge and satisfy any
judgment or decree which may be entered against it or them in respect of such
claim.
Section 9.10 Eligibility Requirements for Securities Administrator.
The Securities Administrator hereunder shall at all times be a
corporation or association organized and doing business under the laws the
United States of America or any state thereof, authorized under such laws to
exercise corporate trust powers, having a combined capital and surplus of at
least $50,000,000, subject to supervision or examination by federal or state
authority and with a credit rating of at least investment grade or at least
"A/F1" by Fitch if Fitch is a Rating Agency. If such corporation or association
publishes reports of condition at least annually, pursuant to law or to the
requirements of the aforesaid supervising or examining authority, then for the
purposes of this Section 9.10 the combined capital and surplus of such
corporation or association shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. In
case at any time the Securities Administrator shall cease to be eligible in
accordance with the provisions of this Section 9.10, the Securities
Administrator shall resign immediately in the manner and with the effect
specified in Section 6.06 hereof. The entity serving as Securities Administrator
may have normal banking and trust relationships with the Depositor, the Seller,
the Master Servicer, any Custodian or the Trustee and their respective
affiliates.
ARTICLE X
REMIC ADMINISTRATION
Section 10.01 REMIC Administration.
(a) REMIC elections as set forth in the Preliminary Statement shall
be made on Forms 1066 or other appropriate federal tax or information return
for the taxable year ending on the last day of the calendar year in which the
Certificates are issued. The regular interests and residual interest in each
REMIC shall be as designated in the Preliminary Statement.
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(b) The Closing Date is hereby designated as the "Startup Day" of
each REMIC within the meaning of section 860G(a)(9) of the Code. The latest
possible maturity date for purposes of Treasury Regulation 1.860G-1(a)(4) will
be the Latest Possible Maturity Date.
` (c) The Securities Administrator shall represent the Trust Fund in
any administrative or judicial proceeding relating to an examination or audit
by any governmental taxing authority with respect thereto. The Securities
Administrator shall pay any and all tax related expenses (not including taxes)
of each REMIC, including but not limited to any professional fees or expenses
related to audits or any administrative or judicial proceedings with respect
to such REMIC that involve the Internal Revenue Service or state tax
authorities, but only to the extent that (i) such expenses are ordinary or
routine expenses, including expenses of a routine audit but not expenses of
litigation (except as described in (ii)); or (ii) such expenses or liabilities
(including taxes and penalties) are attributable to the negligence or willful
misconduct of the Securities Administrator in fulfilling its duties hereunder
(including its duties as tax return preparer). The Securities Administrator
shall be entitled to reimbursement of expenses to the extent provided in
clause (i) above from the Distribution Account, provided, however, the
Securities Administrator shall not be entitled to reimbursement for expenses
incurred in connection with the preparation of tax returns and other reports
as required by Section 6.20 and this Section.
(d) The Securities Administrator shall prepare, the Trustee shall
sign and the Securities Administrator shall file all of each REMIC's federal
and appropriate state tax and information returns as such REMIC's direct
representative. The expenses of preparing and filing such returns shall be
borne by the Securities Administrator. In preparing such returns, the
Securities Administrator shall, with respect to each REMIC other than the
Master REMIC: (i) treat the accrual period for interests in such REMIC as the
calendar month; (ii) account for distributions made from each REMIC other than
the Master REMIC as made on the first day of each succeeding calendar month;
(iii) account for income under the all-OID method at the weighted average of
the Net Mortgage Rates; (iv) use the aggregation method provided in Treasury
Regulation section 1.1275-2(c); and (v) account for income and expenses
related to each REMIC other than the Master REMIC in the manner resulting in
the lowest amount of excess inclusion income possible accruing to the Holder
of the residual interest in each such REMIC.
(e) The Securities Administrator or its designee shall perform on
behalf of each REMIC all reporting and other tax compliance duties that are
the responsibility of such REMIC under the Code, the REMIC Provisions, or
other compliance guidance issued by the Internal Revenue Service or any state
or local taxing authority. Among its other duties, if required by the Code,
the REMIC Provisions, or other such guidance, the Securities Administrator
shall provide, upon receipt of additional reasonable compensation, (i) to the
Treasury or other governmental authority such information as is necessary for
the application of any tax relating to the transfer of a Residual Certificate
to any disqualified person or organization pursuant to Treasury Regulation
1.860E-2(a)(5) and any person designated in Section 860E(e)(3) of the Code and
(ii) to the Certificateholders and the Trustee such information or reports as
are required by the Code or REMIC Provisions.
(f) To the extent within their control, the Trustee, the Securities
Administrator, the Master Servicer and the Holders of Certificates shall take
any action or cause any REMIC to take
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any action necessary to maintain the status of any REMIC as a REMIC under the
REMIC Provisions and shall assist each other as necessary to create or
maintain such status. None of the Trustee, the Securities Administrator, the
Master Servicer, nor the Holder of any Residual Certificate shall knowingly
take any action, cause any REMIC to take any action or fail to take (or fail
to cause to be taken) any action that, under the REMIC Provisions, if taken or
not taken, as the case may be, could result in an Adverse REMIC Event unless
the Trustee, the Securities Administrator and the Master Servicer have
received an Opinion of Counsel (at the expense of the party seeking to take
such action) to the effect that the contemplated action will not endanger such
status or result in the imposition of such a tax. In addition, prior to taking
any action with respect to any REMIC or the assets therein, or causing any
REMIC to take any action, which is not expressly permitted under the terms of
this Agreement, any Holder of a Residual Certificate will consult with the
Trustee, the Securities Administrator, the Master Servicer or their respective
designees, in writing, with respect to whether such action could cause an
Adverse REMIC Event to occur with respect to any REMIC, and no such Person
shall take any such action or cause any REMIC to take any such action as to
which the Trustee, the Securities Administrator or the Master Servicer has
advised it in writing that an Adverse REMIC Event could occur; provided,
however, that if no Adverse REMIC Event would occur but such action could
result in the imposition of additional taxes on the Residual
Certificateholders, no such Person shall take any such action, or cause any
REMIC to take any such action without the written consent of the Residual
Certificateholders.
(g) Each Holder of a Residual Certificate shall pay when due any and
all taxes imposed on the related REMIC by federal or state governmental
authorities. To the extent that such taxes are not paid by a Residual
Certificateholder, the Paying Agent shall pay any remaining REMIC taxes out of
current or future amounts otherwise distributable to the Holder of the
Residual Certificate in any such REMIC or, if no such amounts are available,
(A) out of other amounts held in the Distribution Account, and shall reduce
amounts otherwise payable to holders of regular interests in any such REMIC or
(B) to the extent that any such taxes are imposed on the REMIC as a result of
the breach of any representation, warranty or covenant of the Master Servicer,
the Securities Administrator or any Servicer, then the Master Servicer, the
Securities Administrator, or that Servicer, as applicable, shall pay when due
any and all such taxes.
(h) The Securities Administrator shall, for federal income tax
purposes, maintain books and records with respect to each REMIC on a calendar
year and on an accrual basis.
(i) No additional contributions of assets shall be made to any REMIC,
except as expressly provided in this Agreement.
(j) Neither the Securities Administrator nor the Master Servicer
shall enter into any arrangement by which any REMIC will receive a fee or
other compensation for services.
(k) [Reserved].
(l) The Class A-R Holder shall act as "tax matters person" with
respect to each REMIC created hereunder and the Securities Administrator shall
act as agent for the Class A-R Holder in such roles, unless and until another
party is so designated by the Class A-R Holder.
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(m) The Securities Administrator, on behalf of the Trustee, shall
treat the Reserve Fund as an outside reserve fund within the meaning of
Treasury Regulation 1.860G-2(h) that is owned by the holders of the Class
Notional Amount Certificates, and that is not an asset of any REMIC created
hereunder. The Securities Administrator, on behalf of the Trustee, shall treat
the rights of the holders of the LIBOR Certificates to receive payments from
the Reserve Fund and from the Corridor Contracts as rights in an interest rate
cap contract written by the Holders of the Notional Amount Certificates or by
the Corridor Contract Counterparty, as applicable, in respect of any Net WAC
Shortfalls distribution in favor of the Holders of the LIBOR Certificates.
Thus, the LIBOR Certificates shall be treated as representing ownership of not
only a Master REMIC regular interest, but also ownership of an interest in an
interest rate cap contract. For purposes of determining the issue price of the
Master REMIC regular interest, the Securities Administrator, on behalf of the
Trustee, shall assume that the Class 1-A Corridor Contract, the Class 1-B-1
Corridor Contract, the Class 1-B-2 Corridor Contract and the Class 1-B-3
Corridor Contract entered into with the Corridor Contract Counterparty have
values of $334,000, $33,000, $19,000, and $22,000, respectively and that the
cap contracts entered into with respect to the Notional Amount Certificates
have a value of $10,000 in the aggregate.
Section 10.02 Prohibited Transactions and Activities.
Neither the Depositor, the Master Servicer nor the Trustee shall sell,
dispose of, or substitute for any of the Mortgage Loans, except in a disposition
pursuant to (i) the foreclosure of a Mortgage Loan, (ii) the bankruptcy of the
Trust Fund, (iii) the termination of each REMIC pursuant to Article VII of this
Agreement, (iv) a substitution pursuant to Article II of this Agreement or (v) a
repurchase of Mortgage Loans pursuant to Article II of this Agreement, nor
acquire any assets for any REMIC, nor sell or dispose of any investments in the
Distribution Account for gain, nor accept any contributions to any REMIC after
the Closing Date, unless it has received an Opinion of Counsel (at the expense
of the party causing such sale, disposition, substitution or acceptance) that
such disposition, acquisition, substitution, or acceptance will not result in an
Adverse REMIC Event, (b) affect the distribution of interest or principal on the
Certificates or (c) result in the encumbrance of the assets transferred or
assigned to the Trust Fund (except pursuant to the provisions of this
Agreement).
The Master Servicer with respect to the Mortgage Loans shall not
consent to any modification of any such Mortgage Loan for which the consent of
the Master Servicer is required under the applicable Purchase and Servicing
Agreement under which such Mortgage Loan is serviced, that would (i) increase
the interest rate in respect of such Mortgage, defer for a period in excess of
six months or forgive the payment of any principal or interest, reduce the
outstanding principal amount (except for actual payments of principal), increase
the Servicing Fee on such Mortgage Loan or extend the final maturity date on
such Mortgage Loan, or (ii) result in a substitution or release of collateral or
in the provision of additional collateral for the Mortgage Loan, unless the
applicable Mortgage Loan is in default or default is reasonably foreseeable in
respect of such Mortgage Loan, or the Master Servicer has received an Opinion of
Counsel (at the expense of the party requesting consent for such modification)
that such modification will not result in an Adverse REMIC Event.
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Section 10.03 Indemnification with Respect to Prohibited Transactions
or Loss of REMIC Status.
Upon the occurrence of an Adverse REMIC Event due to the negligent
performance by the Securities Administrator of its duties and obligations set
forth herein, the Securities Administrator shall indemnify the
Certificateholders of the related Residual Certificate against any and all
losses, claims, damages, liabilities or expenses ("Losses") resulting from such
negligence; provided, however, that the Securities Administrator shall not be
liable for any such Losses attributable to the action or inaction of the
Depositor, the Trustee or the Holder of the Residual Certificate, nor for any
such Losses resulting from misinformation provided by any of the foregoing
parties on which the Securities Administrator has relied. Notwithstanding the
foregoing, however, in no event shall the Securities Administrator have any
liability (1) for any action or omission that is taken in accordance with and in
compliance with the express terms of, or which is expressly permitted by the
terms of, this Agreement or under any Purchase and Servicing Agreements or under
any Acknowledgement, (2) for any Losses other than arising out of malfeasance,
willful misconduct or negligent performance by the Service Administrator of its
duties and obligations set forth herein, and (3) for any special or
consequential damages to Certificateholders of the related Residual Certificate
(in addition to payment of principal and interest on the Certificates).
Section 10.04 REO Property.
(a) Notwithstanding any other provision of this Agreement, the Master
Servicer, acting on behalf of the Trustee hereunder, shall not, except to the
extent provided in the applicable Purchase and Servicing Agreement, knowingly
permit any Servicer to, rent, lease, or otherwise earn income on behalf of any
REMIC with respect to any REO Property which might cause an Adverse REMIC
Event unless the applicable Servicer has provided to the Trustee and the
Securities Administrator an Opinion of Counsel concluding that, under the
REMIC Provisions, such action would not adversely affect the status of any
REMIC as a REMIC and any income generated for any REMIC by the REO Property
would not result in an Adverse REMIC Event.
(b) The Depositor shall cause the applicable Servicer (to the extent
provided in its Purchase and Servicing Agreement) to make reasonable efforts
to sell any REO Property for its fair market value. In any event, however, the
Depositor shall, or shall cause the applicable Servicer (to the extent
provided in its Purchase and Servicing Agreement) to, dispose of any REO
Property within three years of its acquisition by the Trust Fund unless the
Depositor or the applicable Servicer (on behalf of the Trust Fund) has
received a grant of extension from the Internal Revenue Service to the effect
that, under the REMIC Provisions and any relevant proposed legislation and
under applicable state law, the REMIC may hold REO Property for a longer
period without causing an Adverse REMIC Event. If such an extension has been
received, then the Depositor, acting on behalf of the Trustee hereunder,
shall, or shall cause the applicable Servicer to, continue to attempt to sell
the REO Property for its fair market value for such period longer than three
years as such extension permits (the "Extended Period"). If such an extension
has not been received and the Depositor or the applicable Servicer, acting on
behalf of the Trust Fund hereunder, is unable to sell the REO Property within
33 months after its acquisition by the Trust Fund or if such an extension, has
been received and the Depositor or the
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applicable Servicer is unable to sell the REO Property within the period
ending three months before the close of the Extended Period, the Depositor
shall cause the applicable Servicer, before the end of the three year period
or the Extended Period, as applicable, to (i) purchase such REO Property at a
price equal to the REO Property's fair market value or (ii) auction the REO
Property to the highest bidder (which may be the applicable Servicer) in an
auction reasonably designed to produce a fair price prior to the expiration of
the three-year period or the Extended Period, as the case may be.
Section 10.05 Fidelity.
The Master Servicer, at its expense, shall maintain in effect a blanket
fidelity bond and an errors and omissions insurance policy, affording coverage
with respect to all directors, officers, employees and other Persons acting on
such Master Servicer's behalf, and covering errors and omissions in the
performance of the Master Servicer's obligations hereunder. The errors and
omissions insurance policy and the fidelity bond shall be in such form and
amount generally acceptable for entities serving as master servicers and
trustees.
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01 Binding Nature of Agreement; Assignment.
This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and permitted assigns.
Section 11.02 Entire Agreement.
This Agreement contains the entire agreement and understanding among
the parties hereto with respect to the subject matter hereof, and supersedes all
prior and contemporaneous agreements, understandings, inducements and
conditions, express or implied, oral or written, of any nature whatsoever with
respect to the subject matter hereof. The express terms hereof control and
supersede any course of performance and/or usage of the trade inconsistent with
any of the terms hereof.
Section 11.03 Amendment.
(a) This Agreement may be amended from time to time by the Depositor,
the Master Servicer, the Securities Administrator, and the Trustee, without
notice to or the consent of any of the Holders, (i) to cure any ambiguity or
mistake, (ii) to cause the provisions herein to conform to or be consistent
with or in furtherance of the statements made with respect to the
Certificates, the Trust Fund or this Agreement in any Offering Document, or to
correct or supplement any provision herein which may be inconsistent with any
other provisions herein or with the provisions of any Purchase and Servicing
Agreement, (iii) to make any other provisions with respect to matters or
questions arising under this Agreement or (iv) to add, delete, or amend any
provisions to the extent necessary or desirable to comply with any
requirements imposed by the Code and the REMIC Provisions. No such amendment
effected pursuant to the preceding sentence shall, as evidenced by an Opinion
of Counsel, result in an Adverse REMIC Event, nor
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shall such amendment effected pursuant to clause (iii) of such sentence
adversely affect in any material respect the interests of any Holder. Prior to
entering into any amendment without the consent of Holders pursuant to this
paragraph, the Trustee shall be provided with an Opinion of Counsel (at the
expense of the party requesting such amendment) to the effect that such
amendment is permitted under this Section. Any such amendment shall be deemed
not to adversely affect in any material respect any Holder, if the Trustee
receives written confirmation from each Rating Agency that such amendment will
not cause such Rating Agency to reduce the then current rating assigned to the
Certificates.
(b) This Agreement may also be amended from time to time by the
Depositor, the Master Servicer, the Securities Administrator and the Trustee,
with the consent of the Holders of not less than 66-2/3% of the Class
Principal Balance (or Percentage Interest) of each Class of Certificates
affected thereby for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Agreement or of
modifying in any manner the rights of the Holders; provided, however, that no
such amendment shall be made unless the Trustee receives an Opinion of
Counsel, at the expense of the party requesting the change, that such change
will not cause an Adverse REMIC Event; and provided further, that no such
amendment may (i) reduce in any manner the amount of, or delay the timing of,
payments received on Mortgage Loans which are required to be distributed on
any Certificate, without the consent of the Holder of such Certificate or (ii)
reduce the aforesaid percentages of Class Principal Balance or Class Notional
Amount (or Percentage Interest) of Certificates of each Class, the Holders of
which are required to consent to any such amendment without the consent of the
Holders of 100% of the Class Principal Balance or Class Notional Amount (or
Percentage Interest) of each Class of Certificates affected thereby. For
purposes of this paragraph, references to "Holder" or "Holders" shall be
deemed to include, in the case of any Class of Book-Entry Certificates, the
related Certificate Owners.
(c) Promptly after the execution of any such amendment, the
Securities Administrator shall furnish written notification of the substance
of such amendment to each Holder, the Depositor and the Rating Agencies.
(d) It shall not be necessary for the consent of Holders under this
Section 11.03 to approve the particular form of any proposed amendment, but it
shall be sufficient if such consent shall approve the substance thereof. The
manner of obtaining such consents and of evidencing the authorization of the
execution thereof by Holders shall be subject to such reasonable regulations
as the Trustee may prescribe.
Section 11.04 Voting Rights.
Except to the extent that the consent of all affected
Certificateholders is required pursuant to this Agreement, with respect to any
provision of this Agreement requiring the consent of Certificateholders
representing specified percentages of aggregate outstanding Certificate Balance
or Class Notional Amount (or Percentage Interest), Certificates owned by the
Depositor, the Master Servicer, the Securities Administrator, the Trustee, any
Servicer or any Affiliates thereof are not to be counted so long as such
Certificates are owned by the Depositor, the Master Servicer, the Securities
Administrator, the Trustee, any Servicer or any Affiliate thereof.
127
Section 11.05 Provision of Information.
(a) For so long as any of the Certificates of any Class are
"restricted securities" within the meaning of Rule 144(a)(3) under the Act,
each of the Depositor, the Master Servicer, the Securities Administrator and
the Trustee (upon instruction from the Depositor) agree to cooperate with each
other to provide to any Certificateholders and to any prospective purchaser of
Certificates designated by such holder, upon the request of such holder or
prospective purchaser, any information required to be provided to such holder
or prospective purchaser to satisfy the condition set forth in Rule 144A(d)(4)
under the Act. Any reasonable, out-of-pocket expenses incurred by the Trustee,
the Master Servicer or the Securities Administrator in providing such
information shall be reimbursed by the Depositor.
(b) The Securities Administrator shall provide to any person to whom
a Prospectus was delivered, upon the request of such person specifying the
document or documents requested, a copy (excluding exhibits) of any report on
Form 8-K or Form 10-K filed with the Securities and Exchange Commission
pursuant to Section 6.20(b). Any reasonable out-of-pocket expenses incurred by
the Securities Administrator in providing copies of such documents shall be
reimbursed by the Depositor.
Section 11.06 Governing Law.
THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS WITHOUT REGARD TO
CONFLICT OF LAWS PRINCIPLES APPLIED IN NEW YORK (OTHER THAN SECTION 5-1401 OF
THE NEW YORK GENERAL OBLIGATIONS LAW).
Section 11.07 Notices.
All requests, demands, notices, authorizations, directions, consents,
waivers and communications hereunder shall be in writing and shall be deemed to
have been duly given when received by (a) in the case of the Depositor, Xxxxxx
Xxxxxxx Capital I Inc., 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, telephone
number (000) 000-0000, Attention: Xxxxxx Xxxxxxx Mortgage Loan Trust 2004-11AR,
(b) in the case of the Seller, Xxxxxx Xxxxxxx Mortgage Capital Inc., 0000 Xxxxxx
xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxx Xxxxxxx Mortgage
Loan Trust 2004-11AR, (c) in the case of the Master Servicer or the Securities
Administrator, Xxxxx Fargo Bank, National Association, X.X. Xxx 00, Xxxxxxxx,
Xxxxxxxx 00000 (or, for overnight deliveries, 0000 Xxx Xxxxxxxxx Xxxx, Xxxxxxxx,
Xxxxxxxx 00000), telecopy number (000) 000-0000, Attention: Xxxxxx Xxxxxxx
Mortgage Loan Trust 2004-11AR, (d) with respect to the Trustee or the
Certificate Registrar, its respective Corporate Trust Office and (e) in the case
of the Rating Agencies, the address specified therefor in the definition
corresponding to the name of such Rating Agency, or as to each party such other
address as may hereafter be furnished by such party to the other parties in
writing. All demands, notices and communications to a party hereunder shall be
in writing and shall be deemed to have been duly given when delivered to such
party at the relevant address, facsimile number or electronic mail address set
forth above or at such other address, facsimile number or electronic mail
address as
128
such party may designate from time to time by written notice in accordance
with this Section 11.07.
Section 11.08 Severability of Provisions.
If any one or more of the covenants, agreements, provisions or terms of
this Agreement shall be for any reason whatsoever held invalid, then such
covenants, agreements, provisions or terms shall be deemed severable from the
remaining covenants, agreements, provisions or terms of this Agreement and shall
in no way affect the validity or enforceability of the other provisions of this
Agreement or of the Certificates or the rights of the Holders thereof.
Section 11.09 Indulgences; No Waivers.
Neither the failure nor any delay on the part of a party to exercise
any right, remedy, power or privilege under this Agreement shall operate as a
waiver thereof, nor shall any single or partial exercise of any right, remedy,
power or privilege preclude any other or further exercise of the same or of any
other right, remedy, power or privilege, nor shall any waiver of any right,
remedy, power or privilege with respect to any occurrence be construed as a
waiver of such right, remedy, power or privilege with respect to any other
occurrence. No waiver shall be effective unless it is in writing and is signed
by the party asserted to have granted such waiver.
Section 11.10 Headings Not To Affect Interpretation.
The headings contained in this Agreement are for convenience of
reference only, and they shall not be used in the interpretation hereof.
Section 11.11 Benefits of Agreement.
Nothing in this Agreement or in the Certificates, express or implied,
shall give to any Person, other than the parties to this Agreement and their
successors hereunder and the Holders of the Certificates, any benefit or any
legal or equitable right, power, remedy or claim under this Agreement, except to
the extent specified in Section 11.15.
Section 11.12 Special Notices to the Rating Agencies.
(a) The Depositor shall give prompt notice to the Rating Agencies of
the occurrence of any of the following events of which it has notice:
(i) any amendment to this Agreement pursuant to Section
11.03;
(ii) any assignment by the Master Servicer of its rights
hereunder or delegation of its duties hereunder;
(iii) the occurrence of any Event of Default described in
Section 6.14;
(iv) any notice of termination given to the Master Servicer
pursuant to Section 6.14 and any resignation of the Master Servicer
hereunder;
129
(v) the appointment of any successor to any Master Servicer
pursuant to Section 6.14;
(vi) the making of a final payment pursuant to Section 7.02;
and
(vii) any termination of the rights and obligations of any
Servicer under the applicable Purchase and Servicing Agreement.
(b) All notices to the Rating Agencies provided for this Section
shall be in writing and sent by first class mail, telecopy or overnight
courier, to the address specified therefor in the definition corresponding to
the name of such Rating Agency.
(c) The Securities Administrator shall provide or make available to
the Rating Agencies reports prepared pursuant to Section 4.05. In addition,
the Securities Administrator shall, at the expense of the Trust Fund, make
available to each Rating Agency such information as such Rating Agency may
reasonably request regarding the Certificates or the Trust Fund, to the extent
that such information is reasonably available to the Securities Administrator.
(d) The Depositor hereby represents to S&P that, to the Depositor's
knowledge, the information provided to such Rating Agency, including the loan
level detail, is true and correct according to such Rating Agency's
requirements.
Section 11.13 Conflicts.
To the extent that the terms of this Agreement conflict with the terms
of any Purchase and Servicing Agreement, the related Purchase and Servicing
Agreement shall govern.
Section 11.14 Counterparts.
This Agreement may be executed in one or more counterparts, each of
which shall be deemed to be an original, and all of which together shall
constitute one and the same instrument.
Section 11.15 No Petitions.
The Trustee and the Master Servicer (not in its individual corporate
capacity, but solely as Master Servicer hereunder), by entering into this
Agreement, hereby covenant and agree that they shall not at any time institute
against the Depositor, or join in any institution against the Depositor of, any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings,
or other proceedings under any United States federal or state bankruptcy or
similar law in connection with any obligations relating to this Agreement or any
of the documents entered into by the Depositor in connection with the
transactions contemplated by this Agreement, except that the Trustee shall not
be prohibited from filing a proof of claim in any such proceeding.
130
IN WITNESS WHEREOF, the parties hereto have caused their names to be
signed hereto by their respective officers hereunto duly authorized as of the
day and year first above written.
XXXXXX XXXXXXX CAPITAL I INC.,
as Depositor
By: /s/ Xxxxxxx Xxx
-----------------------------------------------
Name: Xxxxxxx Xxx
Title: Vice President
DEUTSCHE BANK NATIONAL TRUST COMPANY,
as Trustee
By: /s/ Xxxx Xxxxxxx
-----------------------------------------------
Name: Xxxx Xxxxxxx
Title: Associate
By: /s/ Xxxxxxx Xxxxxxxx
-----------------------------------------------
Name: Xxxxxxx Xxxxxxxx
Title: Assistant Vice President
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
as Master Servicer
By: /s/ Xxx Xxxxx
-----------------------------------------------
Name: Xxx Xxxxx
Title: Vice President
XXXXX FARGO BANK, NATIONAL ASSOCIATION,
as Securities Administrator
By:
-----------------------------------------------
Name:
Title:
Solely for purposes of Section 2.05
accepted and agreed to by:
XXXXXX XXXXXXX MORTGAGE CAPITAL INC.
By: /s/ Xxxxxxx Xxx
------------------------------------------------
Name: Xxxxxxx Xxx
Title: Vice President
2
EXHIBIT A
FORMS OF CERTIFICATES
A-1
EXHIBIT B
FORM OF RESIDUAL CERTIFICATE TRANSFER AFFIDAVIT (TRANSFEREE)
STATE OF )
) ss.:
COUNTY OF )
[NAME OF OFFICER], _________________ being first duly sworn, deposes
and says:
1. That he [she] is [title of officer] ________________________ of
[name of Purchaser] _________________________________________
(the "Purchaser"), a _______________________ [description of
type of entity] duly organized and existing under the laws of
the [State of __________] [United States], on behalf of which he
[she] makes this affidavit.
2. That the Purchaser's Taxpayer Identification Number is [ ].
3. That the Purchaser is not a "disqualified organization" within
the meaning of Section 860E(e)(5) of the Internal Revenue Code
of 1986, as amended (the "Code") and will not be a "disqualified
organization" as of [date of transfer], and that the Purchaser
is not acquiring a Residual Certificate (as defined in the
Agreement) for the account of, or as agent (including a broker,
nominee, or other middleman) for, any person or entity from
which it has not received an affidavit substantially in the form
of this affidavit. For these purposes, a "disqualified
organization" means the United States, any state or political
subdivision thereof, any foreign government, any international
organization, any agency or instrumentality of any of the
foregoing (other than an instrumentality if all of its
activities are subject to tax and a majority of its board of
directors is not selected by such governmental entity), any
cooperative organization furnishing electric energy or providing
telephone service to persons in rural areas as described in Code
Section 1381(a)(2)(C), any "electing large partnership" within
the meaning of Section 775 of the Code, or any organization
(other than a farmers' cooperative described in Code Section
521) that is exempt from federal income tax unless such
organization is subject to the tax on unrelated business income
imposed by Code Section 511.
4. That the Purchaser either (x) is not, and on __________________
[date of transfer] will not be, an employee benefit plan or
other retirement arrangement subject to Section 406 of the
Employee Retirement Income Security Act of 1974, as amended
("ERISA"), or Section 4975 of the Code ("Code"), (collectively,
a "Plan") or a person acting on behalf of any such Plan or
investing the assets of any such Plan to acquire a Residual
Certificate; (y) is an insurance company that is purchasing the
Certificate with funds contained in an "insurance company
general account" as defined in Section V(e) of Prohibited
Transaction Class Exemption ("PTCE") 95-60 and the purchase and
holding of the Certificate satisfy the requirements for
exemptive relief under Sections I and III of XXXX
X-0
95-60; or (z) herewith delivers to the Certificate Registrar an
opinion of counsel satisfactory to the Certificate Registrar and
the Securities Administrator and upon which the Certificate
Registrar, the Trustee, the Master Servicer, the Depositor and
Securities Administrator shall be entitled to rely, to the
effect that the purchase or holding of such Residual Certificate
by the Investor will not result in any non-exempt prohibited
transactions under Title I of ERISA or Section 4975 of the Code
and will not subject the Certificate Registrar, the Trustee, the
Depositor, the Master Servicer or the Securities Administrator
to any obligation in addition to those undertaken by such
entities in the Pooling and Servicing Agreement, which opinion
of counsel shall not be an expense of the Trust Fund or any of
the above parties.
5. That the Purchaser hereby acknowledges that under the terms of
the Pooling and Servicing Agreement, dated as of December 1,
2004 (the "Agreement"), by and among Xxxxxx Xxxxxxx Capital I
Inc., as Depositor, Xxxxx Fargo Bank, National Association, as
Master Servicer and as Securities Administrator and Deutsche
Bank National Trust Company, as Trustee with respect to Xxxxxx
Xxxxxxx Mortgage Loan Trust 2004-11AR, Mortgage Pass-Through
Certificates, no transfer of the Residual Certificates shall be
permitted to be made to any person unless the Certificate
Registrar has received a certificate from such transferee
containing the representations in paragraphs 3 and 4 hereof.
6. That the Purchaser does not hold REMIC residual securities as
nominee to facilitate the clearance and settlement of such
securities through electronic book-entry changes in accounts of
participating organizations (such entity, a "Book-Entry
Nominee").
7. That the Purchaser does not have the intention to impede the
assessment or collection of any federal, state or local taxes
legally required to be paid with respect to such Residual
Certificate.
8. That the Purchaser will not transfer a Residual Certificate to
any person or entity (i) as to which the Purchaser has actual
knowledge that the requirements set forth in paragraph 3,
paragraph 6 or paragraph 10 hereof are not satisfied or that the
Purchaser has reason to believe does not satisfy the
requirements set forth in paragraph 7 hereof, and (ii) without
obtaining from the prospective Purchaser an affidavit
substantially in this form and providing to the Certificate
Registrar a written statement substantially in the form of
Exhibit C to the Agreement.
9. That the Purchaser understands that, as the holder of a Residual
Certificate, the Purchaser may incur tax liabilities in excess
of any cash flows generated by the interest and that it intends
to pay taxes associated with holding such Residual Certificate
as they become due.
10. That the Purchaser (i) is not a Non-U.S. Person or (ii) is a
Non-U.S. Person that holds a Residual Certificate in connection
with the conduct of a trade or business within the United States
and has furnished the transferor the Certificate Registrar
B-2
with an effective Internal Revenue Service Form W-8ECI
(Certificate of Foreign Person's Claim for Exemption From
Withholding on Income Effectively Connected With the Conduct of
a Trade or Business in the United States) or successor form at
the time and in the manner required by the Code or (iii) is a
Non-U.S. Person that has delivered to the transferor, the
Trustee and the Certificate Registrar an opinion of a nationally
recognized tax counsel to the effect that the transfer of such
Residual Certificate to it is in accordance with the
requirements of the Code and the regulations promulgated
thereunder and that such transfer of a Residual Certificate will
not be disregarded for federal income tax purposes. "Non-U.S.
Person" means an individual, corporation, partnership or other
person other than (i) a citizen or resident of the United
States; (ii) a corporation, partnership or other entity created
or organized in or under the laws of the United States or any
state thereof, including for this purpose, the District of
Columbia; (iii) an estate that is subject to U.S. federal income
tax regardless of the source of its income; (iv) a trust if a
court within the United States is able to exercise primary
supervision over the administration of the trust and one or more
United States trustees have authority to control all substantial
decisions of the trust; and, (v) to the extent provided in
Treasury regulations, certain trusts in existence on August 20,
1996 that are treated as United States persons prior to such
date and elect to continue to be treated as United States
persons.
11. The Purchaser will not cause income from the Residual
Certificate to be attributable to a foreign permanent
establishment or fixed base of the Purchaser or another U.S.
taxpayer.
12. That the Purchaser agrees to such amendments of the Pooling and
Servicing Agreement as may be required to further effectuate the
restrictions on transfer of any Residual Certificate to such a
"disqualified organization," an agent thereof, a Book-Entry
Nominee, or a person that does not satisfy the requirements of
paragraph 7 and paragraph 10 hereof.
13. That the Purchaser consents to the designation of the Securities
Administrator to act as agent for the "tax matters person" of
each REMIC created by the Trust Fund pursuant to the Pooling and
Servicing Agreement.
B-3
IN WITNESS WHEREOF, the Purchaser has caused this instrument to be
executed on its behalf, pursuant to authority of its Board of Directors, by
its [title of officer] this _____ day of __________ 20__.
________________________________________
[name of Purchaser]
By:_____________________________________
Name:
Title:
Personally appeared before me the above-named [name of officer]
________________, known or proved to me to be the same person who executed the
foregoing instrument and to be the [title of officer] _________________ of the
Purchaser, and acknowledged to me that he [she] executed the same as his [her]
free act and deed and the free act and deed of the Purchaser.
Subscribed and sworn before me this _____ day of __________ 20__.
NOTARY PUBLIC
__________________________________
COUNTY OF ________________________
STATE OF _________________________
My commission expires the _____ day of __________ 20__.
B-4
EXHIBIT C
FORM OF RESIDUAL CERTIFICATE TRANSFER AFFIDAVIT (TRANSFEROR)
__________________________________
Date
Re: Xxxxxx Xxxxxxx Mortgage Loan Trust 2004-11AR
Mortgage Pass-Through Certificates
_______________________ (the "Transferor") has reviewed the attached
affidavit of _____________________________ (the "Transferee"), and has no actual
knowledge that such affidavit is not true and has no reason to believe that the
information contained in paragraph 7 thereof is not true, and has no reason to
believe that the Transferee has the intention to impede the assessment or
collection of any federal, state or local taxes legally required to be paid with
respect to a Residual Certificate. In addition, the Transferor has conducted a
reasonable investigation at the time of the transfer and found that the
Transferee had historically paid its debts as they came due and found no
significant evidence to indicate that the Transferee will not continue to pay
its debts as they become due.
Very truly yours,
_________________________________
Name:
Title:
C-1
EXHIBIT D
FORM OF CERTIFICATION OF XXXXX FARGO AS
MASTER SERVICER AND SECURITIES ADMINISTRATOR
Re: Xxxxxx Xxxxxxx Mortgage Loan Trust 2004-11AR (the "Trust"), Mortgage
Pass-Through Certificates, Series 2004-11AR, issued pursuant to the
Pooling and Servicing Agreement, dated as of December 1, 2004 (the
"Pooling and Servicing Agreement"), among Xxxxxx Xxxxxxx Capital I
Inc., as depositor (the "Depositor"), Xxxxx Fargo Bank, National
Association, as master servicer (the "Master Servicer") and as
securities administrator (the "Securities Administrator"), and Deutsche
Bank National Trust Company, as trustee
I, [identify the certifying individual], certify to the Depositor and
its officers, directors and affiliates, and with the knowledge and intent that
they will rely upon this certification, that:
1. I have reviewed the annual report on Form 10-K ("Annual Report"), and
all reports on Form 8-K containing distribution reports (collectively
with the Annual Report, the "Reports") filed in respect of periods
included in the year covered by the Annual Report, of the Trust;
2. To the best of my knowledge, the information in the Reports, taken as a
whole, does not contain any untrue statement of a material fact or omit
to state a material fact necessary to make the statements made, in
light of the circumstances under which such statements were made, not
misleading as of the last day of the period covered by the Annual
Report;
3. To the best of my knowledge, the distribution or servicing information
required to be provided to the Trustee by the Securities Administrator
or the Master Servicer, as applicable, under the Pooling and Servicing
Agreement, for inclusion in the Reports is included in these Reports;
4. I am responsible for reviewing the activities performed by the Master
Servicer and the Securities Administrator under the Pooling and
Servicing Agreement and the servicers (the "Servicers") under their
respective purchase and servicing agreements (the "Purchase and
Servicing Agreements"), and to the best of my knowledge and the annual
compliance review required under the Purchase and Servicing Agreements,
and except as disclosed in the Reports, each of the Master Servicer,
the Securities Administrator and each Servicer has fulfilled its
respective obligations under the Pooling and Servicing Agreement or the
applicable Purchase and Servicing Agreement; and
5. The Reports disclose all significant deficiencies relating to the
compliance by each of the Servicers with the minimum servicing
standards based upon the reports provided by independent public
accountants, after conducting a review in compliance with the Uniform
Single Attestation Program for Mortgage Bankers or similar procedure,
as set forth in the related Purchase and Servicing Agreement, that are
included in the Reports.
D-1
In giving the certifications above, I have reasonably relied on
information provided to me by the following unaffiliated parties: the Servicers.
By:_____________________________________
Name:
Title:
Dated: ___________, ____
D-2
EXHIBIT E
LIST OF PURCHASE AND SERVICING AGREEMENTS
1. First Amended and Restated Mortgage Loan Flow Purchase, Sale and Servicing
Agreement, dated as of April 1, 2004 among Cendant Mortgage Corporation, as a
seller and servicer, Xxxxxx'x Gate Residential Mortgage Trust, as a seller, and
Xxxxxx Xxxxxxx Mortgage Capital Inc., as purchaser, as amended by Amendment No.
1, dated as of September 15, 2004;
2. Amended and Restated Master Seller's Warranties and Servicing Agreement,
dated as of February 5, 2004 between National City Mortgage Co., as seller and
servicer, and Xxxxxx Xxxxxxx Mortgage Capital Inc., as purchaser;
3. Mortgage Loan Sale and Servicing Agreement, dated as of September 1, 2003
between GreenPoint Mortgage Funding, Inc., as seller and servicer, and Xxxxxx
Xxxxxxx Mortgage Capital Inc., as purchaser, as amended by Amendment No. 1,
dated as of September 22, 2004;
4. Servicing Agreement, dated as of May 29, 2003 among Option One Mortgage
Corporation, as servicer, and Xxxxxx Xxxxxxx Mortgage Capital Inc., as owner, as
amended by Amendment No. 1, dated as of September 1, 2004.
5. Mortgage Loan Purchase and Warranties Agreement dated as of June 1, 2004
between Xxxxxx Xxxxxxx Mortgage Capital Inc., as purchaser, and Quicken Loans,
Inc., as seller.
6. Second Amended and Restated Master Mortgage Loan Purchase Agreement, dated as
of February 1, 2004 between Xxxxxx Xxxxxxx Xxxx Xxxxxx Credit Corporation, as
seller, and Xxxxxx Xxxxxxx Mortgage Capital Inc., as purchaser;
7. Amended and Restated Master Servicing Agreement, dated as of February 1, 2004
between Xxxxxx Xxxxxxx Xxxx Xxxxxx Credit Corporation, as servicer, and Xxxxxx
Xxxxxxx Mortgage Capital Inc.;
8. Flow Mortgage Loan Sale and Servicing Agreement dated as of October 1, 2003
between Bank of America, National Association, as seller and servicer and Xxxxxx
Xxxxxxx Mortgage Capital Inc., as Purchaser.
9. Seller's Purchase, Warranties and Servicing Agreement dated as of September
1, 2004 between Wachovia Mortgage Corporation, as seller and servicer and Xxxxxx
Xxxxxxx Mortgage Capital Inc., as Purchaser.
E-1
EXHIBIT F
1. Custodial Agreement dated as of March 1, 2004 between Cendant Mortgage
Corporation and Xxxxxx'x Gate Residential Mortgage Trust, as a xxxxxxx, Xxxxxx
Xxxxxxx Mortgage Capital Inc., as purchaser, and Deutsche Bank Trust Company
Americas, as custodian;
2. Custodial Agreement dated as of September 25, 2003 between National City
Mortgage Co., as seller, Xxxxxx Xxxxxxx Mortgage Capital Inc., as purchaser, and
Deutsche Bank Trust Company Americas, as custodian;
3. Custodial Agreement dated as of November 4, 2003 between National City
Mortgage Co., as seller, Xxxxxx Xxxxxxx Mortgage Capital Inc., as purchaser, and
Deutsche Bank Trust Company Americas, as custodian;
4. Custodial Agreement dated as of September 1, 2003 between GreenPoint Mortgage
Funding, Inc., as seller, Xxxxxx Xxxxxxx Mortgage Capital Inc., as purchaser,
and Deutsche Bank Trust Company Americas, as custodian;
5. [Option One]; and
6. Custodial Agreement, dated as of December 1, 2004, among Xxxxxx Xxxxxxx
Mortgage Capital Inc., as purchaser, Bank of America, National Association, as a
seller and a servicer, GreenPoint Mortgage Funding, Inc., as a seller and a
servicer, Xxxxxx Xxxxxxx Xxxx Xxxxxx Credit Corporation, as a seller and a
servicer, Cendant Mortgage Corporation, as a seller and a servicer, Xxxxxx'x
Gate Residential Mortgage Trust, as a seller, Wachovia Mortgage Corporation, as
a seller and a servicer, Xxxxx Fargo Bank, National Association, as master
servicer and securities administrator, Deutsche Bank National Trust Company, as
trustee, and JPMorgan Chase Bank, National Association, as custodian.
F-1
EXHIBIT G
ASSIGNMENT AND NOTICE OF TRANSFER WITH RESPECT TO ADDITIONAL
COLLATERAL MORTGAGE LOANS
G-1
EXHIBIT H
FORM OF RULE 144A TRANSFER CERTIFICATE
Re: Xxxxxx Xxxxxxx Mortgage Loan Trust 2004-11AR,
Mortgage Pass-Through Certificates
Reference is hereby made to the Pooling and Servicing Agreement, dated
as of December 1, 2004 (the "Pooling and Servicing Agreement"), by and among
Xxxxxx Xxxxxxx Capital I Inc., as Depositor, Xxxxx Fargo Bank, National
Association, as Master Servicer and as Securities Administrator and Deutsche
Bank National Trust Company, as Trustee. Capitalized terms used but not defined
herein shall have the meanings given to them in the Pooling and Servicing
Agreement.
This letter relates to $__________ initial Certificate Balance of Class
_____ Certificates which are held in the form of Definitive Certificates
registered in the name of ______________ (the "Transferor"). The Transferor has
requested a transfer of such Definitive Certificates for Definitive Certificates
of such Class registered in the name of [insert name of transferee].
In connection with such request, and in respect of such Certificates,
the Transferor hereby certifies that such Certificates are being transferred in
accordance with (i) the transfer restrictions set forth in the Pooling and
Servicing Agreement and the Certificates and (ii) Rule 144A under the Securities
Act to a purchaser that the Transferor reasonably believes is a "qualified
institutional buyer" within the meaning of Rule 144A purchasing for its own
account or for the account of a "qualified institutional buyer," which purchaser
is aware that the sale to it is being made in reliance upon Rule 144A, in a
transaction meeting the requirements of Rule 144A and in accordance with any
applicable securities laws of any state of the United States or any other
applicable jurisdiction.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Underwriter, the Certificate Registrar and the
Depositor.
___________________________________________
[Name of Transferor]
By:________________________________________
Name:
Title:
Dated: ___________, ____
H-1
EXHIBIT I
FORM OF PURCHASER'S LETTER FOR
INSTITUTIONAL ACCREDITED INVESTOR
Date
Dear Sirs:
In connection with our proposed purchase of $______________ principal
amount of Xxxxxx Xxxxxxx Mortgage Loan Trust 2004-11AR, Mortgage Pass-Through
Certificates (the "Privately Offered Certificates") of Xxxxxx Xxxxxxx Capital I
Inc. (the "Depositor"), we confirm that:
(1) We understand that the Privately Offered Certificates have not been,
and will not be, registered under the Securities Act of 1933, as
amended (the "Securities Act"), and may not be sold except as permitted
in the following sentence. We agree, on our own behalf and on behalf of
any accounts for which we are acting as hereinafter stated, that if we
should sell any Privately Offered Certificates within two years of the
later of the date of original issuance of the Privately Offered
Certificates or the last day on which such Privately Offered
Certificates are owned by the Depositor or any affiliate of the
Depositor we will do so only (A) to the Depositor, (B) to "qualified
institutional buyers" (within the meaning of Rule 144A under the
Securities Act) in accordance with Rule 144A under the Securities Act
("QIBs"), (C) pursuant to the exemption from registration provided by
Rule 144 under the Securities Act, or (D) to an institutional
"accredited investor" within the meaning of Rule 501(a)(1), (2), (3) or
(7) of Regulation D under the Securities Act that is not a QIB (an
"Institutional Accredited Investor") which, prior to such transfer,
delivers to the Certificate Registrar under the Pooling and Servicing
Agreement, dated as of December 1, 2004 (the "Pooling and Servicing
Agreement"), by and among Xxxxxx Xxxxxxx Capital I Inc., as Depositor,
Xxxxx Fargo Bank, National Association, as Master Servicer and as
Securities Administrator and Deutsche Bank National Trust Company, as
Trustee, a signed letter in the form of this letter; and we further
agree, in the capacities stated above, to provide to any person
purchasing any of the Privately Offered Certificates from us a notice
advising such purchaser that resales of the Privately Offered
Certificates are restricted as stated herein.
(2) We understand that, in connection with any proposed resale of any
Privately Offered Certificates to an Institutional Accredited Investor,
we will be required to furnish to the Certificate Registrar a
certification from such transferee in the form hereof to confirm that
the proposed sale is being made pursuant to an exemption from, or in a
transaction not subject to, the registration requirements of the
Securities Act. We further understand that the Privately Offered
Certificates purchased by us will bear a legend to the foregoing
effect.
I-1
(3) We are acquiring the Privately Offered Certificates for investment
purposes and not with a view to, or for offer or sale in connection
with, any distribution in violation of the Securities Act. We have such
knowledge and experience in financial and business matters as to be
capable of evaluating the merits and risks of our investment in the
Privately Offered Certificates, and we and any account for which we are
acting are each able to bear the economic risk of such investment.
(4) We are an Institutional Accredited Investor and we are acquiring the
Privately Offered Certificates purchased by us for our own account or
for one or more accounts (each of which is an Institutional Accredited
Investor) as to each of which we exercise sole investment discretion.
(5) We have received such information as we deem necessary in order to
make our investment decision.
(6) If we are acquiring ERISA-Restricted Certificates, we understand that
in accordance with ERISA, the Code and the Exemption, no Plan and no
person acting on behalf of such a Plan may acquire such Certificate
except in accordance with Section 3.03(d) of the Pooling and Servicing
Agreement.
Terms used in this letter which are not otherwise defined herein have
the respective meanings assigned thereto in the Pooling and Servicing Agreement.
I-2
You and the Certificate Registrar are entitled to rely upon this letter
and are irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceeding or official inquiry
with respect to the matters covered hereby.
Very truly yours,
_______________________________________
[Purchaser]
By:____________________________________
Name:
Title:
I-3
EXHIBIT J
FORM OF ERISA TRANSFER AFFIDAVIT
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
The undersigned, being first duly sworn, deposes and says as follows:
1. The undersigned is the ______________________ of ______________
(the "Investor"), a [corporation duly organized] and existing under the laws
of __________, on behalf of which he makes this affidavit.
2. The Investor either (x) is not, and on ___________ [date of
transfer] will not be, an employee benefit plan or other retirement
arrangement subject to Section 406 of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA"), or Section 4975 of the Internal Revenue
Code of 1986, as amended (the "Code"), (collectively, a "Plan") or a person
acting on behalf of any such Plan or investing the assets of any such Plan;
(y) if the Certificate has been the subject of an ERISA-Qualifying
Underwriting, is an insurance company that is purchasing the Certificate with
funds contained in an "insurance company general account" as defined in
Section V(e) of Prohibited Transaction Class Exemption ("PTCE") 95-60 and the
purchase and holding of the Certificate satisfy the requirements for exemptive
relief under Sections I and III of PTCE 95-60; or (z) herewith delivers to the
Certificate Registrar an opinion of counsel satisfactory to the Certificate
Registrar and the Securities Administrator and upon which the Certificate
Registrar, the Trustee, the Master Servicer, the Depositor and the Securities
Administrator shall be entitled to rely, to the effect that the purchase and
holding of such Certificate by the Investor will not constitute or result in
any non-exempt prohibited transactions under Title I of ERISA or Section 4975
of the Code and will not subject the Certificate Registrar, the Trustee, the
Master Servicer, the Depositor or the Securities Administrator to any
obligation in addition to those undertaken by such entities in the Pooling and
Servicing Agreement, which opinion of counsel shall not be an expense of the
Trust Fund or the above parties.
3. The Investor hereby acknowledges that under the terms of the
Pooling and Servicing Agreement, dated as of December 1, 2004 (the "Pooling
and Servicing Agreement"), by and among Xxxxxx Xxxxxxx Capital I Inc., as
Depositor, Xxxxx Fargo Bank, National Association, as Master Servicer and as
Securities Administrator and Deutsche Bank National Trust Company, as Trustee,
no transfer of the ERISA-Restricted Certificates shall be permitted to be made
to any person unless the Certificate Registrar has received a certificate from
such transferee in the form hereof.
J-1
IN WITNESS WHEREOF, the Investor has caused this instrument to be
executed on its behalf, pursuant to proper authority, by its duly authorized
officer, duly attested, this ____ day of _______________ 20___.
_________________________________________
[Investor]
By:______________________________________
Name:
Title:
ATTEST:
________________________________
STATE OF )
) ss.:
COUNTY OF )
Personally appeared before me the above-named ________________, known
or proved to me to be the same person who executed the foregoing instrument and
to be the ____________________ of the Investor, and acknowledged that he
executed the same as his free act and deed and the free act and deed of the
Investor.
Subscribed and sworn before me this _____ day of _________ 20___.
_________________________________
NOTARY PUBLIC
My commission expires the
_____ day of __________ 20___.
J-2
EXHIBIT K
FORM OF LETTER OF REPRESENTATIONS
WITH THE DEPOSITORY TRUST COMPANY
[On File with Securities Administrator]
K-1
EXHIBIT L
FORM OF CUSTODIAN CERTIFICATION
December 29, 2004
Xxxxxx Xxxxxxx Capital I Inc.
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxx Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxx Fargo Bank, National Association
0000 Xxx Xxxxxxxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
Deutsche Bank National Trust Company, as Trustee
0000 Xxxx Xx. Xxxxxx Xxxxx
Xxxxx Xxx, Xxxxxxxxxx 00000
Re: Pooling and Servicing Agreement ("Pooling and Servicing
-------------------------------------------------------
Agreement") relating to Xxxxxx Xxxxxxx Mortgage Loan
----------------------------------------------------
Trust 2004-11AR, Mortgage Pass-Through Certificates,
----------------------------------------------------
Series 2004-11AR
----------------
Ladies and Gentlemen:
In accordance with and subject to the provisions of Section 2.02 of the
Pooling and Servicing Agreement, the undersigned, as Custodian, hereby certifies
that, except for the exceptions noted on the schedule attached hereto, (a) all
documents required to be delivered to the Custodian pursuant to Sections
2.01(a)(i) through (iv) and (b), (c), (d), (e) and (g), and if delivered to it,
the documents identified in Section 2.01(a)(v) through (viii) and (ix)(c) and
(f) of the Pooling and Servicing Agreement are in its possession, (b) such
documents have been reviewed by it and have not been mutilated, damaged,
defaced, torn or otherwise physically altered, and such documents relate to such
Mortgage Loan, (c) based on its examination and only as to the foregoing
documents, these documents with respect to each Mortgage Loan accurately reflect
the information contained in the Mortgage Note and Mortgage and (d) each
Mortgage Note has been endorsed and each assignment of Mortgage has been
delivered as provided in Section 2.01 of the Pooling and Servicing Agreement.
The Custodian has made no independent examination of any documents contained in
each Mortgage File beyond the review specifically mentioned above. The Custodian
makes no representations as to: (i) the validity, legality, sufficiency,
enforceability or genuineness of any of the documents delivered in accordance
with Section 2.01 of the Pooling and Servicing Agreement or any of the Mortgage
Loans identified in the Mortgage Loan Schedule, or (ii) the collectibility,
insurability, effectiveness or suitability of any such Mortgage Loan.
The Custodian acknowledges receipt of notice that the Depositor has
granted to the Trustee for the benefit of the Certificateholders a security
interest in all of the Depositor's right, title and interest in and to the
Mortgage Loans.
L-1
Capitalized terms used herein without definition shall have the meaning
assigned to them in the Pooling and Servicing Agreement.
[DEUTSCHE BANK NATIONAL TRUST COMPANY,]
[JPMORGAN CHASE BANK, NATIONAL ASSOCIATION,]
as Custodian
By: __________________________
Authorized Representative
L-2
EXHIBIT M
[RESERVED]
M-1
SCHEDULE A
MORTGAGE LOAN SCHEDULE
[On File with the Trustee and the Securities Administrator]
S-1
SCHEDULE B
PRINCIPAL BALANCES SCHEDULE
[Not Applicable]
S-2
