EXECUTION
STRUCTURED ASSET SECURITIES CORPORATION, as Depositor,
and
U.S. BANK NATIONAL ASSOCIATION, as Trustee
---------------------------
TRUST AGREEMENT
Dated as of February 1, 1999
---------------------------
FIRST NATIONWIDE TRUST 1999-1
STRUCTURED ASSET SECURITIES CORPORATION
MORTGAGE PASS-THROUGH CERTIFICATES
SERIES 1999-1
Table of Contents
Page
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ARTICLE I
DEFINITIONS
Section 1.01. Definitions...............................................10
Section 1.02. Calculations Respecting Mortgage Loans....................40
Section 1.03. Calculations Respecting Accrued Interest..................40
ARTICLE II
DECLARATION OF TRUST; ISSUANCE OF CERTIFICATES
Section 2.01. Creation and Declaration of Trust Fund; Conveyance of
Mortgage Loans............................................40
Section 2.02. Acceptance of Trust Fund by Trustee: Review of
Documentation for Trust Fund..............................41
Section 2.03. Representations and Warranties of the Depositor...........42
Section 2.04. Discovery of Breach.......................................43
Section 2.05. Repurchase, Purchase or Substitution of Mortgage Loans....44
Section 2.06. Grant Clause..............................................44
ARTICLE III
THE CERTIFICATES
Section 3.01. The Certificates..........................................45
Section 3.02. Registration..............................................46
Section 3.03. Transfer and Exchange of Certificates.....................46
Section 3.04. Cancellation of Certificates..............................49
Section 3.05. Replacement of Certificates...............................49
Section 3.06. Persons Deemed Owners.....................................49
Section 3.07. Temporary Certificates....................................49
Section 3.08. Appointment of Paying Agent...............................50
Section 3.09. Book-Entry Certificates...................................50
ARTICLE IV
ADMINISTRATION OF THE TRUST FUND
Section 4.01. [Omitted].................................................51
Section 4.02. [Omitted].................................................51
Section 4.03. Reports to Certificateholders.............................51
Section 4.04. Certificate Account.......................................54
Section 4.05. Determination of LIBOR....................................55
Section 4.06. The Class 2-A3 Reserve Fund...............................55
ARTICLE V
DISTRIBUTIONS TO HOLDERS OF CERTIFICATES
Section 5.01. Distributions Generally...................................55
Section 5.02. Distributions from the Certificate Account................56
Section 5.03. Allocation of Realized Losses.............................63
Section 5.04. Trustee Advances..........................................65
Section 5.05. Distributions of Principal on Redemption Certificates.....66
Section 5.06. The Class 2-A3 Certificate Insurance Policy...............70
ARTICLE VI
CONCERNING THE TRUSTEE; EVENTS OF DEFAULT
Section 6.01. Duties of Trustee.........................................73
Section 6.02. Certain Matters Affecting the Trustee.....................75
Section 6.03. Trustee Not Liable for Certificates.......................75
Section 6.04. Trustee May Own Certificates..............................76
Section 6.05. Eligibility Requirements for Trustee......................76
Section 6.06. Resignation and Removal of Trustee........................76
Section 6.07. Successor Trustee.........................................77
Section 6.08. Merger or Consolidation of Trustee........................77
Section 6.09. Appointment of Co-Trustee, Separate Trustee or Custodian..78
Section 6.10. Authenticating Agents.....................................79
Section 6.11. Indemnification of Trustee................................80
Section 6.12. Fees and Expenses of Trustee..............................81
Section 6.13. Collection of Monies......................................81
Section 6.14. Trustee To Act; Appointment of Successor..................81
Section 6.15. Additional Remedies of Trustee Upon Event of Default......83
Section 6.16. Waiver of Defaults........................................83
Section 6.17. Notification to Holders...................................83
Section 6.18. Directions by Certificateholders and Duties of Trustee
During Event of Default...................................83
Section 6.19. Action Upon Certain Failures of the Servicer and Upon
Event of Default..........................................84
ARTICLE VII
PURCHASE AND TERMINATION
Section 7.01. Termination of Trust Fund Upon Repurchase or
Liquidation of All Mortgage Loans.........................84
Section 7.02. Procedure Upon Termination of Trust Fund..................85
Section 7.03. Additional Trust Fund Termination Requirements............85
ARTICLE VIII
RIGHTS OF CERTIFICATEHOLDERS
Section 8.01. Limitation on Rights of Holders...........................86
Section 8.02. Access to List of Holders.................................87
Section 8.03. Acts of Holders of Certificates...........................87
ARTICLE IX
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
Section 9.01. Trustee To Retain Possession of Certain Documents.........88
Section 9.02. Preparation of Tax Returns and Other Reports..............88
Section 9.03. Release of Mortgage Files.................................89
ARTICLE X
REMIC ADMINISTRATION
Section 10.01. REMIC Administration......................................90
Section 10.02. Prohibited Transactions and Activities....................91
Section 10.03. Indemnification with Respect to Certain Taxes and Loss
of REMIC Status...........................................92
ARTICLE XI
MISCELLANEOUS PROVISIONS
Section 11.01. Binding Nature of Agreement; Assignment...................92
Section 11.02. Entire Agreement..........................................92
Section 11.03. Amendment.................................................93
Section 11.04. Voting Rights.............................................94
Section 11.05. Provision of Information..................................94
Section 11.06. Governing Law.............................................94
Section 11.07. Notices...................................................94
Section 11.08. Severability of Provisions................................95
Section 11.09. Indulgences; No Waivers...................................95
Section 11.10. Headings Not To Affect Interpretation.....................95
Section 11.11. Benefits of Agreement.....................................95
Section 11.12. Special Notices to the Rating Agencies....................95
Section 11.13. Counterparts..............................................96
Section 11.14. Matters Relating to the Class 2-A3 Certificate
Insurance Policy..........................................96
ATTACHMENTS
Exhibit A Forms of Certificates
Exhibit B-1 Form of Trustee Final Certification
Exhibit B-2 Form of Endorsement
Exhibit C Request for Release of Documents and Receipt
Exhibit D-l Form of Residual Certificate Transfer Affidavit (Transferee)
Exhibit D-2 Form of Residual Certificate Transfer Affidavit (Transferor)
Exhibit E Seller's Warranties and Servicing Agreement
Exhibit F Form of Rule 144A Transfer Certificate
Exhibit G Form of Purchaser's Letter for Institutional Accredited
Investors
Exhibit H Form of ERISA Transfer Affidavit
Exhibit I Monthly Remittance Advice
Exhibit J Monthly Electronic Data Transmission
Exhibit K Class 2-A3 Certificate Insurance Policy
Exhibit L The Insurance Agreement
Schedule A Mortgage Loan Schedule
Schedule B Principal Amount Schedule
This TRUST AGREEMENT, dated as of February 1, 1999 (the "Agreement"),
is by and between STRUCTURED ASSET SECURITIES CORPORATION, a Delaware
corporation, as depositor (the "Depositor"), and U.S. BANK NATIONAL
ASSOCIATION, a national banking association, as trustee (the "Trustee") and
acknowledged by FIRST NATIONWIDE MORTGAGE CORPORATION solely for purposes of
Section 9.03 and Section 11.11.
PRELIMINARY STATEMENT
All defined terms used in this Preliminary Statement that are not
defined in the Preliminary Statement are defined in Article I (Definitions)
herein.
The Depositor has acquired the Mortgage Loans from Xxxxxx Capital, A
Division of Xxxxxx Brothers Holdings Inc. (the "Seller"), and at the Closing
Date is the owner of the Mortgage Loans and the other property being conveyed
by it to the Trustee for inclusion in the Trust Fund. On the Closing Date, the
Depositor will acquire the Certificates from the Trust Fund, as consideration
for its transfer to the Trust Fund of the Mortgage Loans (exclusive of any
Retained Yield on such Mortgage Loans) and the other property constituting the
Trust Fund. The Depositor has duly authorized the execution and delivery of
this Agreement to provide for the conveyance to the Trustee of the Mortgage
Loans and the other property constituting the Trust Fund. All covenants and
agreements made by the Depositor and the Trustee herein with respect to the
Mortgage Loans and the other property constituting the Trust Fund are for the
benefit of the Holders from time to time of the Certificates and the Class
2-A3 Certificate Insurer. The Depositor is entering into this Agreement, and
the Trustee is accepting the Trust Fund created hereby, for good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged.
As provided herein, the Trustee shall elect that the Trust Fund be
treated for federal income tax purposes as comprising two real estate mortgage
investment conduits (each a "REMIC" or, in the alternative , the "Lower Tier
REMIC" and the "Upper Tier REMIC," respectively). The Certificates, other than
the Class R Certificate, represent ownership of regular interest in the Upper
Tier REMIC for purposes of the REMIC Provisions. The Upper Tier REMIC shall
also issue a single class of residual interest within the meaning of the REMIC
Provisions and the Class R Certificate shall evidence the ownership of such
residual interest.
The Lower Tier REMIC shall issue two classes of uncertificated Lower
Tier Interests that shall be regular interests in the Lower Tier REMIC within
the meaning of the REMIC Provisions; the "Class LT1 Interest" and the "Class
LT2 Interest". The Lower Tier REMIC shall also issue a single uncertificated
interest that shall be the sole residual interest in the Lower Tier REMIC
within the meaning of the REMIC Provisions; the "Class LTR Interest". The
Class LT1 and Class LT2 Interests will be held as assets of the Upper Tier
REMIC.
The Class LT1 Interest shall have an initial principal balance equal
to the Cut-off Date Aggregate Principal Balance of the Pool 1 Mortgage Loans
and shall bear interest at a rate equal to the weighted average of the Net
Mortgage Rates of the Pool 1 Mortgage Loans (the "Class LT1 Rate"). On any
Distribution Date, the Class LT1 Interest shall be entitled to interest
payments at the Class LT1 Rate and principal distributions to the extent of
the Principal Distribution Amount for the Group 1 Certificates. Realized
Losses and Net Prepayment Interest Shortfalls with respect to the Mortgage
Loans in Pool 1 shall be allocated to the Class LT1 Interest.
The Class LT2 Interest shall have an initial principal balance equal
to the Cut-off Date Aggregate Principal Balance of the Pool 2 Mortgage Loans
and shall bear interest at a rate equal to the weighted average of the Net
Mortgage Rates of the Pool 2 Mortgage Loans (the "Class LT2 Rate"). On any
Distribution Date, the Class LT2 Interest shall be entitled to interest
payments at the Class LT2 Rate and principal distributions to the extent of
the Principal Distribution Amount for the Group 2 Certificates. Realized
Losses and Net Prepayment Interest Shortfalls with respect to the Mortgage
Loans in Pool 2 shall be allocated to the Class LT2 Interest.
The Class LTR Interest shall not have a principal balance and shall
not bear interest. The Class R Certificate shall evidence ownership of the
Class LTR Interest.
The Lower Tier REMIC shall hold all assets included in the Trust Fund
other than (a) the Class LT1, Class LT2, and Class LTR Interests, (b) the
Class 2-A3 Reserve Fund, (c) the Rounding Account, and (d) the Class 2-A3
Certificate Insurance Policy.
The following table sets forth (or describes) the Class designation,
Certificate Interest Rate, initial Class Certificate Principal Amount (or
Aggregate Notional Amount) and minimum denomination for each Class of
Certificates comprising the interests in the Trust Fund created hereunder.
Class Certificate Initial Certificate Minimum
Designation Interest Rate Principal Amount Denominations
--------------------------------------------------------------------------------------------------------
Class 1-A1 6.25% $102,124,000.00 $100,000
Class 2-A1 6.50% 250,000,000.00 100,000
Class 2-A2 6.50% 2,400,000.00 25,000
Class 2-A3 6.50% 21,457,000.00 1,000
Class 2-A4 0.00%(1) 132,100.00 132,100
Class 2-A5 6.50% 20,324,000.00 25,000
Class 2-A6 6.50% 120,000,000.00 100,000
Class 2-A7 6.50% 116,000,000.00 100,000
Class 2-A8 6.50% 169,453,800.00 100,000
Class AX Variable (2) (2) (2)
Class AP 0.00%(3) 1,657,829.43(3) 100,000
Class R 6.50%(4) 100.00 100
Class 1-B1 6.25% 729,000.00 100,000
Class 2-B1 6.50% 13,134,000.00 250,000
Class 1-B2 6.25% 365,000.00 100,000
Class 2-B2 6.50% 6,568,000.00 250,000
Class 1-B3 6.25% 261,000.00 100,000
Class 2-B3 6.50% 2,919,000.00 250,000
Class 1-B4 6.25% 208,000.00 100,000
Class 2-B4 6.50% 2,919,000.00 250,000
Class 1-B5 6.25% 156,000.00 100,000
Class 2-B5 6.50% 1,094,000.00 100,000
Class 1-B6 6.25% 209,359.23 100,000
Class 2-B6 6.50% 1,824,871.40 100,000
----------------------
(1) The Class 2-A4 Certificate is a principal-only certificate and,
accordingly, will not accrue interest.
(2) The Class AX Certificates are interest-only certificates and,
accordingly, will not be entitled to payments of principal. The
Class AX Certificates will consist of two payment components: the
AX(1) Component relating to Pool 1 and the AX(2) Component relating
to Pool 2.
The AX(1) Component will accrue interest at a Component Interest
Rate of 6.25% per annum on a calculated Component Notional Amount
equal, as to any Distribution Date, to the product of (x) the
fraction, the numerator of which is the excess of the Weighted
Average Rate of the Pool 1 Premium Mortgage Loans over 6.25%, and
the denominator of which is 6.25%, and (y) the aggregate Scheduled
Principal Balance of the Pool 1 Premium Mortgage Loans as of the
first day of the related Interest Accrual Period. The initial
Component Notional Amount of the AX(1) Component as of the Closing
Date is $1,934,706.80.
The AX(2) Component will accrue interest at a Component Interest
Rate of 6.50% per annum on a calculated Component Notional Amount
equal, as to any Distribution Date, to the product of (x) the
fraction, the numerator of which is the excess of the Weighted
Average Rate of the Pool 2 Premium Mortgage Loans over 6.50%, and
the denominator of which is 6.50%, and (y) the aggregate Scheduled
Principal Balance of the Pool 2 Premium Mortgage Loans as of the
first day of the related Interest Accrual Period. The initial
Component Notional Amount of the AX(2) Component as of the Closing
Date is $2,333,235.17. The Class AX Certificate will be issued in
minimum Notional Amounts of $100,000.
(3) The Class AP Certificates are principal-only certificates and,
accordingly, will not accrue interest. The Class AP Certificates
will consist of two payment components: (a) the AP(1) Component
relating to Pool 1 and having an initial Component Principal Amount
as of the Closing Date of $173,294.35 and (b) the AP(2) Component
relating to Pool 2 and having an initial Component Principal Amount
as of the Closing Date of $1,484,535.07.
(4) The Class R Certificate will be designated as the sole class of a
residual interest in the Upper-Tier REMIC within the meaning of
Section 860G(a)(2) of the Internal Revenue Code.
As of the Cut-off Date, the Mortgage Loans had an aggregate Scheduled
Principal Balance of $833,966,660.06.
For all purposes of this Agreement, each Certificate Group shall
"relate" to the Mortgage Pool with the same numerical designation.
In consideration of the mutual agreements herein contained, the
Depositor and the Trustee hereby agree as follows:
ARTICLE I
DEFINITIONS
Section 1.01. Definitions. The following words and phrases, unless
the context otherwise requires, shall have the following meanings:
Accepted Servicing Practices: As defined in the Seller's Warranties
and Servicing Agreement.
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.
Accretion Directed Certificate: Any Class 2-A6 Certificates and any
Class 2-A1 Certificates.
Accrual Amount: With respect to any Distribution Date, the sum of the
(i) Class 2-A2 Accrual Amount and (ii) Class 2-A5 Accrual Amount.
Accrual Certificate: Any Class 2-A2 Certificates and Class 2-A5
Certificates.
Accrual Component: None.
Accrued Certificate Interest: As to any Class of Certificates (other
than the Class AX Certificates and any Class of Principal Only Certificates or
Component thereof) and any Notional Component and any Distribution Date,
interest accrued for the related Interest Accrual Period equal to the product
of (x) the Certificate Interest Rate or Component Interest Rate for such Class
of Certificates or Component and (y) the outstanding Class Certificate
Principal Amount (or Aggregate Notional Amount) of such Class of Certificates
or Component Principal Amount (or Component Notional Amount) of such Component
immediately preceding such Distribution Date, as reduced by (i) such Class's
or Component's allocable share of the interest portion of any Excess Losses
with respect to the related Mortgage Pool for such date and, after the Credit
Support Depletion Date for the related Certificate Group, any Realized Losses
with respect to the related Mortgage Pool for such date, (ii) after the Credit
Support Depletion Date for the related Certificate Group, such Class's or
Component's allocable share of any Relief Act Reduction with respect to the
related Mortgage Pool for such date and (iii) any Deferred Interest allocated
to such Class or Component on such date. Such amounts in respect of a Mortgage
Pool described in clauses (i) and (ii) shall be allocable among the related
Certificates (other than the Principal Only Certificates) in respect of a
Mortgage Pool pro rata based on the Accrued Certificate Interest otherwise
distributable thereon. With respect to any Certificate (other than the
Principal Only Certificates), interest will be calculated on the basis of a
360-day year of twelve 30-day months.
With respect to the Class AX Certificates and any Distribution Date,
the sum of the Accrued Certificate Interest on each Component thereof.
Additional Collateral: None.
Adjustable Rate Mortgage Loan: None.
Advance: An advance of the aggregate of payments of principal and
interest (net of the Servicing Fee) on one or more Mortgage Loans that were
due on the Due Date in the related Due Period and not received as of the close
of business on the related Determination Date, required to be made by the
Servicer pursuant to the Seller's Warranties and Servicing Agreement (or by
the Trustee hereunder).
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 Class 2-A3 Certificate Insurance Premium: As to any
Distribution Date, the sum of (a) the Class 2-A3 Certificate Insurance Premium
for such Distribution Date and (b) the amount of any Class 2-A3 Certificate
Insurance Premium that was not distributed to the Class 2-A3 Certificate
Insurer on any prior Distribution Date.
Aggregate Notional Amount: With respect to the Class AX Certificates
and any Distribution Date, the sum of the Component Notional Amounts of the
AX(1) and AX(2) Components on such date, calculated as described in the
Preliminary Statement hereto.
Aggregate Principal Balance: The aggregate of the Scheduled Principal
Balances for all Mortgage Loans in the Trust Fund or in a Mortgage Pool, as
the context requires, at the date of determination.
Aggregate Voting Interests: The aggregate of the Voting Interests of
all the Certificates under this Agreement.
Agreement: This Trust Agreement and all amendments and supplements
hereto.
AP(1) Deferred Amount: As to any Distribution Date on or prior to the
Credit Support Depletion Date for the Group 1 Certificates, the aggregate of
the applicable AP Percentage of the principal portion of each Realized Loss on
a Pool 1 Discount Mortgage Loan, other than an Excess Loss, to be allocated to
the AP(1) Component on such Distribution Date or previously allocated to the
AP(1) Component and not yet paid to the Holders of the Class AP Certificates
pursuant to Section 5.02(a)(v)(A).
AP(2) Deferred Amount: As to any Distribution Date on or prior to the
Credit Support Depletion Date for the Group 2 Certificates, the aggregate of
the applicable AP Percentage of the principal portion of each Realized Loss on
a Pool 2 Discount Mortgage Loan, other than an Excess Loss, to be allocated to
the AP(2) Component on such Distribution Date or previously allocated to the
AP(2) Component and not yet paid to the Holders of the Class AP Certificates
pursuant to Section 5.02(a)(v)(B).
AP Percentage: With respect to any Distribution Date and any Pool 1
Discount Mortgage Loan, the percentage equivalent of the fraction, the
numerator of which is 6.25% minus the applicable Net Mortgage Rate, and the
denominator of which is 6.25%. As to any Pool 1 Non-Discount Mortgage Loan,
0.00%. With respect to any Distribution Date and any Pool 2 Discount Mortgage
Loan, the percentage equivalent of the fraction, the numerator of which is
6.50% minus the applicable Net Mortgage Rate and the denominator of which is
6.50%. As to any Pool 2 Non-Discount Mortgage Loan, 0.00%.
AP Principal Distribution Amount: For any Distribution Date and for
each Certificate Group, the sum of the following amounts:
(i) the applicable AP Percentage of the principal
portion of each Scheduled Payment (without giving effect to any Debt
Service Reduction occurring prior to the Bankruptcy Coverage
Termination Date) on a Mortgage Loan in the related Mortgage Pool due
during the related Due Period;
(ii) the applicable AP Percentage of each of the
following amounts: (1) each Principal Prepayment in the related
Mortgage Pool collected during the applicable Prepayment Period, (2)
each other unscheduled collection for the related Mortgage Pool,
including Insurance Proceeds and Liquidation Proceeds (other than
with respect to any Mortgage Loan in the related Mortgage Pool that
was finally liquidated during the applicable Prepayment Period),
representing or allocable to recoveries of principal received during
the applicable Prepayment Period and (3) the principal portion of all
proceeds of the purchase of any Mortgage Loan in the related Mortgage
Pool (or, in the case of a permitted substitution, amounts
representing a principal adjustment) actually received by the Trustee
with respect to the applicable Prepayment Period;
(iii) with respect to unscheduled recoveries allocable
to principal of any Mortgage Loan in the related Mortgage Pool that
was finally liquidated during the related Prepayment Period, the
applicable AP Percentage of the related net Liquidation Proceeds
allocable to principal; and
(iv) any amounts described in clauses (i) through (iii)
for any previous Distribution Date that remain unpaid.
Appraised Value: With respect to any Mortgage Loan, the amount set
forth in an appraisal made in connection with the origination of such Mortgage
Loan as the value of the related Mortgaged Property.
Assignment of Mortgage: An assignment of the Mortgage, notice of
transfer or equivalent instrument, in recordable form, sufficient under the
laws of the jurisdiction wherein the related Mortgaged Property is located to
reflect the sale of the Mortgage to the Trustee, which assignment, notice of
transfer or equivalent instrument may be in the form of one or more blanket
assignments covering the Mortgage Loans secured by Mortgaged Properties
located in the same jurisdiction, if permitted by law; provided, however, that
the Trustee shall not be responsible for determining whether any such
assignment is in recordable form.
Authenticating Agent: Any authenticating agent appointed by the
Trustee pursuant to Section 6.10.
Authorized Officer: Any Person who may execute an Officer's
Certificate on behalf of the Depositor.
Available Distribution Amount: On any Distribution Date and in
respect of each Mortgage Pool, the sum of the following amounts:
(1) the total amount of all cash received by the Servicer
through the related Collection Period (or, the related Prepayment
Period, in the case of Principal Prepayments) with respect to the
Mortgage Loans in the related Mortgage Pool and remitted to the
Trustee on the Remittance Date (including proceeds of any Insurance
Policy and any other credit support relating to the Mortgage Loans),
plus all Advances made by the Servicer (or Trustee) for such
Distribution Date and any Compensating Interest Payment for such
date, but not including:
(a) all amounts distributed pursuant to Section 5.02 on prior
Distribution Dates;
(b) all Scheduled Payments of principal and interest collected but
due on a date subsequent to the related Due Period;
(c) all Principal Prepayments received or identified by the Servicer
after the related Prepayment Period (together with any interest payments
received with such prepayments to the extent that they represent the payment
of interest accrued on the related Mortgage Loans for the period subsequent to
the related Prepayment Period);
(d) any other unscheduled recovery, including Liquidation Proceeds
and Insurance Proceeds received by the Servicer after the related Prepayment
Period; and
(e) all amounts due or reimbursable to the Trustee or the Servicer
pursuant to the terms of this Agreement or to First Nationwide Mortgage, as
originator of the Mortgage Loans, pursuant to the Seller's Warranties and
Servicing Agreement, including but not limited to any prepayment penalties on
the Mortgage Loans and the Retained Yield; and
(2) any other payment made by the Servicer or the Depositor
or any other Person with respect to such Distribution Date (including
the Purchase Price with respect to any Mortgage Loan repurchased by
the Servicer, the Depositor, Xxxxxx Capital or any other Person).
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 United States
Bankruptcy Code of 1986, as amended, or any other similar state laws.
Bankruptcy Coverage Termination Date: As to both Mortgage Pools, the
Distribution Date on which the Bankruptcy Loss Limit has been reduced to zero
(or less than zero).
Bankruptcy Loss Limit: $217,773.00, which amount shall be reduced
from time to time by the amount of Bankruptcy Losses allocated to either
Certificate Group.
Bankruptcy Losses: (i) with respect to the Mortgage Loans in the
related Mortgage Pool, losses (as reported by the Servicer to the Trustee)
arising from a proceeding under the United States Bankruptcy Code or any other
similar state law or other proceeding with respect to the Mortgagor of or
Mortgaged Property under a Mortgage Loan in the related Mortgage Pool,
including without limitation any such loss arising from (a) the difference
between (i) the principal amount that would have been due under the original
scheduled payments of principal and interest due on the related Mortgage Loan
and (ii) the value established in the relevant court with respect to such
Mortgaged Property, including without limitation a Deficient Valuation, or (b)
a Debt Service Reduction.
Benefit Plan Opinion: An Opinion of Counsel satisfactory to the
Trustee to the effect that any proposed transfer will not (i) cause the assets
of the Trust Fund to be regarded as plan assets for purposes of the Plan Asset
Regulations or (ii) give rise to any fiduciary duty on the part of the
Depositor or the Trustee.
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 condition 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." As of the Closing Date, the following Classes of
Certificates constitute Book-Entry Certificates: Class 1-A, Class 2-A1, Class
2-A2, Class 2-A3, Class 2-A4, Class 2-A5, Class 2-A6, Class 2-A7, Class 2-A8,
Class AP, Class AX, Class 1-B1, Class 2-B1, Class 1-B2, Class 2-B2, Class 1-B3
and Class 2-B3 Certificates.
Breach: As defined in Section 3.03 of the Seller's Warranties and
Servicing Agreement.
Business Day: In the case of the Group 2 Certificates, any day other
than (i) a Saturday or a Sunday, or (ii) a day on which the Certificate
Insurer, 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 State of Maryland, are authorized or obligated by law or executive
order to be closed. In the case of the Group 1 Certificates, the same
definition will apply, but disregarding the reference above to the Certificate
Insurer.
Certificate: Any one of the certificates signed and countersigned by
the Trustee in substantially the forms attached hereto as Exhibit A.
Certificate Account: The account maintained by the Trustee in
accordance with the provisions of Section 4.04.
Certificate Group: The Group 1 Certificates or the Group 2
Certificates, as applicable.
Certificate Interest Rate: With respect to each Class of Certificates
(other than the Class AP or Class AX Certificates), the applicable per annum
rate set forth or described in the Preliminary Statement hereto.
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 Principal Amount: With respect to any Certificate other
than a Notional Certificate, at the time of determination, the maximum
specified dollar amount of principal to which the Holder thereof is then
entitled hereunder, such amount being equal to the initial principal amount
set forth on the face of such Certificate (plus, in the case of any Negative
Amortization Certificate, any Deferred Interest allocated thereto on previous
Distribution Dates, and plus, in the case of any Accrual Certificate, its
Percentage Interest of any related Accrual Amount for each previous
Distribution Date), less the amount of all principal distributions previously
made with respect to such Certificate, all Realized Losses previously
allocated to such Certificate, and, in the case of a Subordinate Certificate,
any Subordinate Certificate Writedown Amount previously allocated to such
Certificate. For purposes of Article V hereof, unless specifically provided to
the contrary, Certificate Principal Amounts shall be determined as of the
close of business of the immediately preceding Distribution Date, after giving
effect to all distributions made on such date. Notional Certificates are
issued without Certificate Principal Amounts.
Certificate Register and Certificate Registrar: The register
maintained and the registrar appointed pursuant to Section 3.02.
Certificateholder: The meaning provided in the definition of "Holder."
Class: All Certificates bearing the same class designation.
Class 2-A2 Accretion Termination Date: The Distribution Date on which
the Class Certificate Principal Amount of the Class 2-A6 Certificates has been
reduced to zero.
Class 2-A2 Accrual Amount: As to the Class 2-A2 Certificates and each
Distribution Date through the Class 2-A2 Accretion Termination Date, the sum
of (x) any amount of Accrued Certificate Interest allocable to the Class 2-A2
Certificates pursuant to Section 5.02(a)(ii) on such Distribution Date and (y)
any Interest Shortfall allocable to the Class 2-A2 Certificates pursuant to
Section 5.02(a)(iii) on such Distribution Date. As to the Class 2-A2
Certificates and each Distribution Date after the Class 2-A2 Accretion
Termination Date, zero.
Class 2-A3 Certificate Insurance Policy: The Certificate Guaranty
Insurance Policy No. 28644 dated the Closing Date issued by the Class 2-A3
Certificate Insurer to the Trustee for the benefit of the Holders of the Class
2-A3 Certificates.
Class 2-A3 Certificate Insurance Premium: With respect to any
Distribution Date and with respect to the Class 2-A3 Certificate Insurance
Policy, an amount equal to 1/12th of the product of (a) the Class Certificate
Principal Amount of the Class 2-A3 Certificates as of such Distribution Date
(prior to giving effect to any distribution thereon on such Distribution Date)
and (b) the Premium Percentage.
Class 2-A3 Certificate Insurer: MBIA Insurance Corporation, or any
successor thereto, as issuer of the Class 2-A3 Certificate Insurance Policy.
Class 2-A3 Certificate Insurer Default: The occurrence and
continuance of any of the following events:
(a) the Class 2-A3 Certificate Insurer shall have failed to make a
payment required to be made under the Class 2-A3 Certificate Insurance Policy
in accordance with its terms;
(b) the Class 2-A3 Certificate Insurer shall have (i) filed a
petition or commenced a case or proceeding under any provision or chapter of
the United States Bankruptcy Code or any other similar federal or state law
relating to insolvency, bankruptcy, rehabilitation, liquidation or
reorganization, (ii) made a general assignment for the benefit of its
creditors, or (iii) had an order for relief entered against it under the
United States Bankruptcy Code or any other similar federal or state law
relating to insolvency, bankruptcy, rehabilitation, liquidation or
reorganization that is final and nonappealable; or
(c) a court of competent jurisdiction, the Office of the Commissioner
of Insurance of the State of New York or other competent regulatory authority
shall have entered a final and nonappealable order, judgment or decree (i)
appointing a custodian, trustee, agent or receiver for the Class 2-A3
Certificate Insurer or for all or any material portion of its property or (ii)
authorizing the taking of possession by a custodian, trustee, agent or
receiver of the Class 2-A3 Certificate Insurer (or the taking of possession of
all or any material portion of the property of the Class 2-A3 Certificate
Insurer).
Class 2-A3 Policy Payments Account: The separate Eligible Account
created and maintained by the Trustee pursuant to Section 5.06(c) in the name
of the Trustee for the benefit of the Class 2-A3 Certificateholders and
designated "U.S. Bank National Association, Class 2-A3 Policy Payments Account
in trust for registered holders of First Nationwide Trust 1999-1, Structured
Asset Securities Corporation Mortgage Pass-Through Certificates, Series
1999-1, Class 2-A3." Funds in the Class 2-A3 Policy Payments Account shall be
held in trust for the benefit of the Class 2-A3 Certificateholders for the
uses and purposes set forth in this Agreement.
Class 2-A3 Reserve Fund: The separate, interest-bearing Eligible
Account created and maintained by the Trustee pursuant to Section 4.06 with a
depository institution in the name of the Trustee for the benefit of the Class
2-A3 Certificateholders and designated "U.S. Bank National Association, Class
2-A3 Reserve Fund in trust for registered holders of First Nationwide Trust
1999-1 Structured Asset Securities Corporation Mortgage Pass-Through
Certificates, Series 1999-1, Class 2-A3." The Class 2-A3 Reserve Fund will not
be a part of any REMIC and, for all federal and state income tax purposes,
will be beneficially owned by Xxxxxx Brothers Inc.
Class 2-A3 Rounding Account: The separate Eligible Account
established and maintained by the Trustee pursuant to Section 5.05(e) in the
name of the Trustee for the benefit of the Class 2-A3 Certificateholders and
designated "U.S. Bank National Association, Class 2-A3 Rounding Account in
trust for registered holders of First Nationwide Trust 1999-1, Structured
Asset Securities Corporation Mortgage Pass-Through Certificates, Series
1999-1, Class 2-A3." Funds in the Rounding Account shall be held in trust for
the benefit of the Class 2-A3 Certificateholders for the uses and purposes set
forth in this Agreement. The Class 2-A3 Rounding Account will not be a part of
any REMIC and, for all federal and state income tax purposes, will be
beneficially owned by Xxxxxx Brothers Inc.
Class 2-A5 Accretion Termination Date: The Distribution Date on which
the Class Certificate Principal Amount of the Class 2-A1 Certificates has been
reduced to zero.
Class 2-A5 Accrual Amount: As to the Class 2-A5 Certificates and each
Distribution Date through the Class 2-A5 Accretion Termination Date, the sum
of (x) any amount of Accrued Certificate Interest allocable to the Class 2-A5
Certificates pursuant to Section 5.02(a)(ii) on such Distribution Date and (y)
any Interest Shortfall allocable to the Class 2-A5 Certificates pursuant to
Section 5.02(a)(iii) on such Distribution Date. As to the Class 2-A5
Certificates and each Distribution Date after the Class 2-A5 Accretion
Termination Date, zero.
Class 2-A7 Percentage: As to any Distribution Date, the lesser of (i)
100% and (ii) the percentage equivalent of the fraction, the numerator of
which is equal to the sum of (a) the Class Certificate Principal Amount of the
Class 2-A7 Certificates immediately prior to such date and (b) $40,000,000,
and the denominator of which is equal to the sum of the aggregate Certificate
Principal Amount of all Group 2 Certificates other than the Component
Principal Amount of the AP(2) Component immediately prior to such date.
Class 2-A7 Prepayment Shift Percentage: As to any Distribution Date
occurring during the five years beginning on the first Distribution Date, 0%.
As to any Distribution Date occurring on or after the fifth anniversary of the
first Distribution Date, the following percentage for such Distribution Date:
for any Distribution Date in the first year thereafter, 40%; for any
Distribution Date in the second year thereafter, 50%; for any Distribution
Date in the third year thereafter, 60%; for any Distribution Date in the
fourth year thereafter, 90%; and for any subsequent Distribution Date, 100%.
Class 2-A7 Priority Amount: As to any Distribution Date, an amount
equal to the lesser of (i) the sum of (x) the product of the Class 2-A7
Percentage for such date, the Class 2-A7 Scheduled Principal Percentage for
such date and the Scheduled Principal Amount for such date and (y) the product
of the Class 2-A7 Percentage for such date, the Class 2-A7 Prepayment Shift
Percentage for such date and the Unscheduled Principal Amount for such date,
and (ii) the Class Certificate Principal Amount of the Class 2-A7 Certificates
immediately prior to such date.
Class 2-A7 Scheduled Principal Percentage: As to any Distribution
Date occurring during the five years beginning on the first Distribution Date,
0%. As to any Distribution Date occurring on or after the fifth anniversary of
the first Distribution Date, 100%.
Class B Certificate: Any Class 1-B1, Class 2-B1, Class 1-B2, Class
2-B2, Class 1-B3, Class 2-B3, Class 1-B4, Class 2-B4, Class 1-B5, Class 2-B5,
Class 1-B6 and Class 2-B6 Certificate.
Class Certificate Principal Amount: With respect to each Class of
Certificates other than any Class of Notional Certificates, the aggregate of
the Certificate Principal Amounts of all Certificates of such Class at the
date of determination.
Class LT1 Interest: As defined in the Preliminary Statement.
Class LT2 Interest: As defined in the Preliminary Statement.
Class LTR Interest: As defined in the Preliminary Statement.
Class LT1 Rate: As defined in the Preliminary Statement.
Class LT2 Rate: As defined in the Preliminary Statement.
Class Percentage: For each Class of Certificates or Component, for
each Distribution Date, the percentage obtained by dividing the Class
Certificate Principal Amount or Component Principal Amount of such Class or
Component immediately prior to such Distribution Date by the aggregate
Certificate Principal Amount of all Certificates or Component Principal Amount
of all Components of the related Certificate Group immediately prior to such
date.
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: February 25, 1999.
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.
Collection Account: Not applicable.
Collection Period: With respect to each Mortgage Loan and any
Distribution Date, the period beginning immediately following the conclusion
of the next preceding Collection Period (or, in the case of the first
Distribution Date, beginning on the Cut-off Date) and ending at the close of
the Business Day immediately preceding the related Remittance Date.
Compensating Interest Payment: With respect to any Distribution Date,
the amount paid by the Servicer in respect of Prepayment Interest Shortfalls
pursuant to Section 4.04(viii) of the Seller's Warranties and Servicing
Agreement.
Component: Any of the components of the Class AP or Class AX
Certificates having the designations, the initial Component Principal Amounts
(in the case of the Class AP Certificate) or the initial Component Notional
Amounts (in the case of the Class AX Certificates) as follows:
Component Component
Designation Principal Amount Notional Amount
----------- ---------------- ---------------
AP(1) $ 173,294.36
AP(2) 1,484,535.07
AX(1) --- $1,934,706.80
AX(2) --- 2,333,235.17
Component Certificate: Any Class AP or Class AX Certificate.
Component Interest Rate: With respect to any Distribution Date and
(i) the AX(1) Component, the Pool 1 Rate and (ii) the AX(2) Component, the
Pool 2 Rate.
Component Notional Amount: With respect to the AX(1) and AX(2)
Components of the Class AX Certificates and any Distribution Date, the
Component Notional Amount calculated as described in footnote 2 of the table
set forth in the Preliminary Statement.
Component Principal Amount: As of any Distribution Date and with
respect to any Component, other than any Notional Component, the initial
Component Principal Amount thereof as set forth in the definition of Component
(plus, in the case of any Negative Amortization Component, any Deferred
Interest allocated thereto on previous Distribution Dates and plus, in the
case of any Accrual Component, any related Accrual Amount for each previous
Distribution Date), less the sum of (x) all amounts distributed in reduction
thereof on previous Distribution Dates pursuant to Section 5.02, (y) the
amount of all Realized Losses previously allocated thereto pursuant to Section
5.03 and (z) any Subordinate Certificate Writedown Amount previously allocated
to such Component.
Conventional Loan: A Mortgage Loan that is not insured by the United
States Federal Housing Administration or guaranteed by the United States
Veterans Administration.
Converted Mortgage Loan: None.
Convertible Mortgage Loan: None.
Corporate Trust Office: The principal corporate trust office of the
Trustee at which, at any particular time, its corporate trust business shall
be administered, which office at the date hereof is located at 000 Xxxx Xxxxx
Xxxxxx, Xx. Xxxx, Xxxxxxxxx 00000, Attention: Structured Finance (First
Nationwide Trust 1999-1/SASCO 1999-1).
Credit Support Depletion Date: As to each Certificate Group, the
Distribution Date on which, after giving effect to all distributions on such
date, the aggregate Certificate Principal Amount of the Subordinate
Certificates of such Certificate Group have been reduced to zero.
Credit Support Percentage: As to any Class of Subordinate
Certificates and any Distribution Date, the sum of the Class Percentages of
all Subordinate Certificates in the related Certificate Group that rank lower
in priority than such Class.
Custodial Agreement: The Custodial Agreement, dated as of February 1,
1999, between the Custodian and the Trustee.
Custodial Account: An account or accounts maintained by the Servicer
pursuant to the Seller's Warranties and Servicing Agreement into which it will
deposit collections and recoveries with respect to the Mortgage Loans.
Custodian: U.S. Bank Trust National Association or any successor in
interest or assigns, to the Custodian under the Custodial Agreement.
Cut-off Date: February 1, 1999.
Cut-off Date Aggregate Principal Balance: With respect to the
Mortgage Loans in the Trust Fund or in a particular Mortgage Pool, as the
context requires, on the Closing Date, the Aggregate Principal Balance of all
such Mortgage Loans as of the Cut-off Date.
Debt Service Reduction: With respect to any Mortgage Loan, a
reduction of the Scheduled Payment that the related Mortgagor is obligated to
pay on any Due Date thereon as a result of any proceeding under bankruptcy law
or any similar proceeding.
Deceased Holder: With respect to a Holder of a Redemption
Certificate, as defined in Section 5.05(b).
Deferred Interest: With respect to any Class of Negative Amortization
Certificates and any Distribution Date, the aggregate Mortgage Loan Negative
Amortization, if any, for the related Collection Period.
Deficiency Amount: The meaning assigned to such term in the Class
2-A3 Certificate Insurance Policy.
Deficient Valuation: With respect to any Mortgage Loan, a valuation
by a court of competent jurisdiction of the Mortgaged Property in an amount
less than the then outstanding indebtedness under such Mortgage Loan, which
valuation results from a proceeding under bankruptcy law or any similar
proceeding.
Definitive Certificate: A Certificate of any Class issued in
definitive, fully registered, certificated form.
Deleted Mortgage Loan: A Mortgage Loan that is repurchased from the
Trust Fund pursuant to the terms hereof or as to which one or more Qualifying
Substitute Mortgage Loans are substituted therefor.
Depositor: Structured Asset Securities Corporation, a Delaware
corporation, having its principal place of business in New York, or its
successors in interest.
Determination Date: With respect to each Distribution Date, the 18th
day of the month in which such Distribution Date occurs, or, if such 18th day
is not a Business Day, the immediately preceding Business Day.
Disqualified Organization: Either (i) the United States, (ii) any
state or political subdivision thereof, (iii) any foreign government, (iv) any
international organization, (v) any agency or instrumentality of any of the
foregoing, (vi) any tax-exempt organization (other than a cooperative
described in section 521 of the Code) which is exempt from the tax imposed by
Chapter 1 of the Code unless such organization is subject to the tax imposed
by section 511 of the Code, (vii) any organization described in section
1381(a)(2)(C) of the Code, or (viii) any other entity designated as a
Disqualified Organization by relevant legislation amending the REMIC
Provisions and in effect at or proposed to be effective as of the time of the
determination. In addition, a corporation will not be treated as an
instrumentality of the United States or of any state or political subdivision
thereof if all of its activities are subject to tax and, with the exception of
the Federal Home Loan Mortgage Corporation, a majority of its board of
directors is not selected by such governmental unit.
Distribution Date: The 25th day of each month or, if such day is not
a Business Day, the next succeeding Business Day, commencing in March 1999.
Due Date: With respect to any Mortgage Loan, the date on which a
Scheduled Payment is due under the related Mortgage Note.
Due Period: With respect to any Distribution Date, the period
commencing on the second day of the month immediately preceding the month in
which such Distribution Date occurs and ending on the first day of the month
in which such Distribution Date occurs.
Eligible Account: Either (i) an account or accounts maintained with a
federal or state chartered depository institution or trust company acceptable
to the Rating Agencies or (ii) an account or accounts the deposits in which
are insured by the FDIC to the limits established by such corporation,
provided that any such deposits not so insured shall be maintained in an
account at a depository institution or trust company whose commercial paper or
other short term debt obligations (or, in the case of a depository institution
or trust company which is the principal subsidiary of a holding company, the
commercial paper or other short term debt or deposit obligations of such
holding company or depository institution, as the case may be) have been rated
by each Rating Agency in its highest short-term rating category, or (iii) a
segregated trust account or accounts (which shall be a "special deposit
account") maintained with the Trustee or any other federal or state chartered
depository institution or trust company, acting in its fiduciary capacity, in
a manner acceptable to the Trustee and the Rating Agencies. Eligible Accounts
may bear interest.
Eligible Investments: Any one or more of the following obligations or
securities:
(i) direct obligations of, and obligations fully
guaranteed as to timely payment of principal and interest by, the
United States of America or any agency or instrumentality of the
United States of America the obligations of which are backed by the
full faith and credit of the United States of America ("Direct
Obligations");
(ii) federal funds, or demand and time deposits in,
certificates of deposits of, or bankers' acceptances issued by, any
depository institution or trust company (including U.S. subsidiaries
of foreign depositories and the Trustee or any agent of the Trustee,
acting in its respective commercial capacity) incorporated or
organized under the laws of the United States of America or any state
thereof and subject to supervision and examination by federal or
state banking authorities, so long as at the time of investment or
the contractual commitment providing for such investment the
commercial paper or other short-term debt obligations of such
depository institution or trust company (or, in the case of a
depository institution or trust company which is the principal
subsidiary of a holding company, the commercial paper or other
short-term debt or deposit obligations of such holding company or
deposit institution, as the case may be) have been rated by each
Rating Agency in its highest short-term rating category or one of its
two highest long-term rating categories;
(iii) repurchase agreements collateralized by Direct
Obligations or securities guaranteed by GNMA, FNMA or FHLMC with any
registered broker/dealer subject to Securities Investors' Protection
Corporation jurisdiction or any commercial bank insured by the FDIC,
if such broker/dealer or bank has an uninsured, unsecured and
unguaranteed obligation rated by each Rating Agency in its highest
short-term rating category;
(iv) securities bearing interest or sold at a discount
issued by any corporation incorporated under the laws of the United
States of America or any state thereof which have a credit rating
from each Rating Agency, at the time of investment or the contractual
commitment providing for such investment, at least equal to one of
the two highest long-term credit rating categories of each Rating
Agency; provided, however, that securities issued by any particular
corporation will not be Eligible Investments to the extent that
investment therein will cause the then outstanding principal amount
of securities issued by such corporation and held as part of the
Trust Fund to exceed 20% of the sum of the Aggregate Principal
Balance and the aggregate principal amount of all Eligible
Investments in the Certificate Account; provided, further, that such
securities will not be Eligible Investments if they are published as
being under review with negative implications from either Rating
Agency;
(v) commercial paper (including both noninterest-bearing
discount obligations and interest-bearing obligations payable on
demand or on a specified date not more than 180 days after the date
of issuance thereof) rated by each Rating Agency in its highest
short-term rating category;
(vi) a Qualified GIC;
(vii) certificates or receipts representing direct
ownership interests in future interest or principal payments on
obligations of the United States of America or its agencies or
instrumentalities (which obligations are backed by the full faith and
credit of the United States of America) held by a custodian in
safekeeping on behalf of the holders of such receipts; and
(viii) any other demand, money market, common trust fund
or time deposit or obligation, or interest-bearing or other security
or investment, (A) rated in the highest rating category by each
Rating Agency or (B) that would not adversely affect the then current
rating by either Rating Agency of any of the Certificates (in the
case of the Class 2-A3 Certificates, determined without regard to the
Class 2-A3 Certificate Insurance Policy);
provided, however, that no such instrument shall be an Eligible Investment if
such instrument evidences either (i) a right to receive only interest payments
with respect to the obligations underlying such instrument, or (ii) both
principal and interest payments derived from obligations underlying such
instrument and the principal and interest payments with respect to such
instrument provide a yield to maturity of greater than 120% of the yield to
maturity at par of such underlying obligations, provided that any such
investment will be a "permitted investment" within the meaning of Section
860G(a)(5) of the Code.
ERISA-Restricted Certificate: Any Subordinate Certificate.
Event of Default: An event described in Section 10.01 of the Seller's
Warranties and Servicing Agreement, which pursuant to such agreement is a
default by the Servicer and entitles the Trustee to terminate such Servicer.
Excess Loss: With respect to each Mortgage Pool, any Bankruptcy Loss,
or portion thereof, in excess of the then-applicable Bankruptcy Loss Limit,
any Fraud Loss, or portion thereof, in excess of the then-applicable Fraud
Loss Limit, and any Special Hazard Loss, or portion thereof, in excess of the
then-applicable Special Hazard Loss Limit.
FDIC: The Federal Deposit Insurance Corporation or any successor
thereto.
FHLMC: The Federal Home Loan Mortgage Corporation, a corporate
instrumentality of the United States created and existing under Title III of
the Emergency Home Finance Act of 1970, as amended, or any successor thereto.
Final Scheduled Distribution Date: In the case of the Group 1
Certificates, February 25, 2014 and, in the case of the Group 2 Certificates,
March 25, 2029.
Financial Intermediary: A broker, dealer, bank or other financial
institution or other Person that clears through or maintains a custodial
relationship with a Clearing Agency Participant.
First Nationwide Mortgage: First Nationwide Mortgage Corporation, a
Delaware corporation and a wholly owned subsidiary of California Federal Bank,
FSB, or any successor in interest.
Fitch: Fitch IBCA, Inc., or any successor in interest.
FNMA: 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.
Fraud Loss: With respect to each Mortgage Pool, any Realized Loss on
a Mortgage Loan in such Mortgage Pool sustained by reason of a default arising
from fraud, dishonesty or misrepresentation in connection with the related
Mortgage Loan.
Fraud Loss Limit: As of the Cut-off Date, $8,339,367. The Fraud Loss
Limit shall be reduced by the amount of Fraud Losses allocated to the
Certificates (or Components thereof), (i) on the first and second
anniversaries of the Cut-off Date, to an amount equal to the excess of 1.00%
of the Cut-off Date Balance of the Mortgage Loans over the cumulative amount
of Fraud Losses allocated to the Certificates (or Components thereof), (ii) on
the third and fourth anniversaries of the Cut-off Date, to an amount equal to
the excess of 0.50% of the Cut-off Date Balance of the Mortgage Loans over the
cumulative amount of Fraud Losses allocated to the Certificates (or Components
thereof), and (iii) on the fifth anniversary of the Cut-off Date, to zero. All
such calculations of the Fraud Loss Limit will be determined on an aggregate
basis rather than by Mortgage Pool or Certificate Group.
GNMA: The Government National Mortgage Association, a wholly owned
corporate instrumentality of the United States within HUD.
Group 1: All of the Group 1 Certificates.
Group 1 Certificate: Any Class 1-A, Class 1-B1, Class 1-B2, Class
1-B3 or Class 1-B4, Class 1-B5, Class 1-B6 or any of the Group 1 Components.
Group 1 Component: The AX(1) Component and the AP(1) Component.
Group 1 Senior Certificate: Any Class 1-A Certificate or the Group 1
Components of the Class AP and Class AX Certificates.
Group 1 Subordinate Certificate: Any of the Class 1-B1, Class 1-B2,
Class 1-B3, Class 1-B4, Class 1-B5 or Class 1-B6 Certificates.
Group 2: All of the Group 2 Certificates.
Group 2 Certificate: Any Class 2-A1, Class 2-A2, Class 2-A3, Class
2-A4, Class 2-A5, Class 2-A6, Class 2-A7, Class 2-A8, Class R, Class 2-B1,
Class 2-B2, Class 2-B3, Class 2-B4, Class 2-B5, Class 2-B6 or any of the Group
2 Components.
Group 2 Component: The AX(2) Component and the AP(2) Component.
Group 2 Senior Certificate: Any Class 2-A1, Class 2-A2, Class 2-A3,
Class 2-A4, Class 2-A5, Class 2-A6, Class 2-A7, Class 2-A8, Class R or any of
the Group 2 Components of the Class AX and Class AP Certificates.
Group 2 Subordinate Certificate: Any Class 2-B1, Class 2-B2, Class
2-B3, Class 2-B4, Class 2-B5 or Class 2-B6 Certificates.
Guaranteed Distributions: (a) With respect to any Distribution Date,
(i) the Accrued Certificate Interest for the Class 2-A3 Certificates for such
Distribution Date, including the amount of any Net Prepayment Interest
Shortfalls allocable to the Class 2-A3 Certificates on such Distribution Date
that are not covered by the Class 2-A3 Reserve Fund, net of any Relief Act
Reduction allocable to such Class on such date and (ii) the amount of any
Realized Loss, including any Excess Loss, allocated to the Class 2-A3
Certificates on such Distribution Date and (b) for the Final Scheduled
Distribution Date, the Class Certificate Principal Amount of the Class 2-A3
Certificates to the extent unpaid on the Final Scheduled Distribution Date.
Holder or Certificateholder: 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
Servicer, the Trustee 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 shall be protected in relying upon any such consent, only
Certificates which a Responsible Officer of the Trustee knows to be so owned
shall be disregarded. The Trustee may request and conclusively rely on
certifications by the Depositor or the Servicer in determining whether any
Certificates are registered to an Affiliate of the Depositor or the 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.
Individual Redemption Certificate: A Redemption Certificate with a
$1,000 Certificate Principal Amount.
Initial LIBOR Rate: None.
Insurance Agreement: The Insurance Agreement, dated as of February 1,
1999, among the Depositor, the Seller, the Trustee and the Class 2-A3
Certificate Insurer, a copy of which is attached as Exhibit L hereto.
Insurance Policy: Any Primary Mortgage Insurance Policy and any
standard hazard insurance policy, flood insurance policy, earthquake insurance
policy or title insurance policy relating to the Mortgage Loans or the
Mortgaged Properties, to be in effect as of the Closing Date or thereafter
during the term of this Agreement.
Insurance Proceeds: Amounts paid by the insurer under any Insurance
Policy, other than (i) amounts to be applied to restoration or repair of the
related Mortgaged Property, (ii) required to be paid over to the Mortgagor
pursuant to law or the related Mortgage Note or (iii) amounts applied toward
payment of the Retained Yield.
Insured Payment: The meaning assigned to such term in the Class 2-A3
Certificate Insurance Policy.
Interest Accrual Period: With respect to any Distribution Date and
any Class of Certificates (other than any Principal Only Certificates) or
Component, the one-month period beginning immediately following the end of the
preceding Interest Accrual Period (or from the Cut-off Date, in the case of
the first Interest Accrual Period) and ending on the last day of the month
preceding the month in which such Distribution Date occurs.
Interest Distribution Amount: Not applicable.
Interest Shortfall: With respect to any Class of Certificates and any
Distribution Date, any Accrued Certificate Interest (net of any Net Prepayment
Interest Shortfalls allocable to such Class) not paid with respect to a
previous Distribution Date.
Intervening Assignments: The original intervening assignments of the
Mortgage, notice of transfer or equivalent instrument.
Latest Possible Maturity Date: March 25, 2031.
Xxxxxx Capital: Xxxxxx Capital, A Division of Xxxxxx Brothers
Holdings Inc., or any successor in interest.
LIBOR: Not Applicable.
LIBOR Certificate: None.
LIBOR Determination Date: Not Applicable.
Liquidated Mortgage Loan: Any defaulted Mortgage Loan as to which the
Servicer has determined that all amounts that it expects to recover on behalf
of the Trust Fund from or on account of such Mortgage Loan have been
recovered.
Liquidation Proceeds: As defined in the Seller's Warranties and
Servicing Agreement but excluding any amounts applied toward payment of the
Retained Yield.
Living Holder: Any Holder of a Redemption Certificate other than a
Deceased Holder.
Loan-to-Value Ratio: With respect to any Mortgage Loan, the ratio of
the principal balance of such Mortgage Loan at origination, or such other date
as is specified, to the Original Value thereof.
London Business Day: Not Applicable.
Lower Tier Interest: Any one of the Class LT1, Class LT2, or Class
LTR Interests as described in the Preliminary Statement.
Lower Tier Interest Rate: The Class LT1 Interest Rate and the Class
LT2 Interest Rate as described in the Preliminary Statement.
Lower Tier REMIC: As described in the Preliminary Statement.
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 File: The mortgage documents listed in Exhibit B-1 to the
Seller's Warranties and Servicing Agreement pertaining to a particular
Mortgage Loan required to be delivered to the Trustee pursuant to this
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 or Section
2.05, including without limitation, each Mortgage Loan listed on the Mortgage
Loan Schedule, as amended from time to time.
Mortgage Loan Negative Amortization: Not Applicable.
Mortgage Loan Sale and Assignment Agreement: The agreement for the
sale of the Mortgage Loans by Xxxxxx Capital to the Depositor and the
assignment to the Depositor of the rights of Xxxxxx Capital under the Seller's
Warranties and Servicing Agreement, between Xxxxxx Capital, as seller and
assignor, and the Depositor, as purchaser and assignee.
Mortgage Loan Schedule: The schedule attached hereto as Schedule A,
which shall identify each Mortgage Loan in either Pool 1 or Pool 2, as such
schedule may be amended from time to time to reflect the addition of Mortgage
Loans to, or the deletion of Mortgage Loans from, the Trust Fund.
Mortgage Note: The note or other evidence of the indebtedness of a
Mortgagor secured by a Mortgage under a Mortgage Loan.
Mortgage Pool: Either of Pool 1 or Pool 2.
Mortgage Rate: As to any Mortgage Loan, the per annum rate at which
interest accrues on such Mortgage Loan.
Mortgaged Property: The fee simple interest in real property,
together with improvements thereto including any exterior improvements to be
completed within 120 days of disbursement of the related Mortgage Loan
proceeds.
Mortgagor: The obligor on a Mortgage Note.
Negative Amortization Certificate: None.
Negative Amortization Component: None.
Net Mortgage Rate: With respect to any Mortgage Loan, the Mortgage
Rate thereof reduced by the sum of the Servicing Fee Rate and the applicable
Retained Yield Rate.
Net Prepayment Interest Shortfall: With respect to any Distribution
Date, the excess, if any, of any Prepayment Interest Shortfalls for such date
over any amount that is required under the Seller's Warranties and Servicing
Agreement to be paid by the Servicer in respect of such shortfalls. Any Net
Prepayment Interest Shortfall shall be allocated among all Classes of
Certificates (other than any Class of Principal Only Certificates) and among
the Components (other than any Principal Only Component) of any Component
Certificate in proportion to the respective amounts of Accrued Certificate
Interest otherwise distributable thereon.
Non-AP Percentage: As to any Pool 1 Discount Mortgage Loan, the
percentage equivalent of the fraction, the numerator of which is the Net
Mortgage Rate of such Pool 1 Discount Mortgage Loan and the denominator of
which is 6.25%. As to any Pool 1 Non-Discount Mortgage Loan, 100%. As to any
Pool 2 Discount Mortgage Loan, the percentage equivalent of the fraction, the
numerator of which is the Net Mortgage Rate of such Pool 2 Discount Mortgage
Loan and the denominator of which is 6.50%. As to any Pool 2 Non-Discount
Mortgage Loan, 100%.
Non-permitted Foreign Holder: As defined in Section 3.03(f).
Non-U.S. Person: Any individual, corporation, partnership or other
person other than a citizen or resident of the United States; 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; an estate that is subject to U.S. federal income tax regardless of
the source of its income; or 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.
Non-Book-Entry Certificate: Any Certificate other than a Book-Entry
Certificate.
Notice of Nonpayment: The notice to be delivered by the Trustee to
the Class 2-A3 Certificate Insurer with respect to any Distribution Date
pursuant to Section 5.06(a), which shall be in the form attached to the Class
2-A3 Certificate Insurance Policy.
Notional Amount: With respect to any Notional Certificate (or
Component thereof) and any Distribution Date, such Certificate's or
Component's Percentage Interest of the Aggregate Notional Amount of such Class
of Certificates for such Distribution Date.
Notional Certificate: The Class AX Certificates.
Notional Component: The AX(1) Component and the AX(2) Component of
the Class AX Certificates.
Offering Document: Either the Prospectus relating to the
publicly-offered Certificates or the private placement memorandum relating to
the Restricted Certificates.
Officer's Certificate: A certificate signed by the Chairman of the
Board, any Vice Chairman, the President, any Vice President or any Assistant
Vice President of a Person, and in each case delivered to the Trustee.
Opinion of Counsel: A written opinion of counsel, reasonably
acceptable in form and substance to the Trustee, and who may be in-house or
outside counsel to the Depositor or the Servicer 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 the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), or the taxation, or the federal income tax status, of each REMIC.
Original Credit Support Percentage: With respect to each Class of
Subordinate Certificates, the Credit Support Percentage for such Class on the
Closing Date.
Original Group Subordinate Principal Amount: With respect to each
Certificate Group, the sum of the Class Certificate Principal Amount of each
related Subordinate Certificate as of the Closing Date.
Original Value: The lesser of (a) the Appraised Value of a Mortgaged
Property at the time the related Mortgage Loan was originated and (b) if the
Mortgage Loan was made to finance the acquisition of the related Mortgaged
Property, the purchase price paid for the Mortgaged Property by the Mortgagor
at the time the related Mortgage Loan was originated.
PAC Amount: Not Applicable.
PAC Certificate: None.
PAC Component: None.
Paying Agent: Any paying agent appointed pursuant to Section 3.08.
Percentage Interest: With respect to any Certificate, its percentage
interest in the undivided beneficial ownership interest in the Trust Fund
evidenced by all Certificates of the same Class as such Certificate. With
respect to any Certificate (other than a Class AX Certificate), the Percentage
Interest evidenced thereby shall equal the initial Certificate Principal
Amount (or, in the case of a Class AX Certificate, the initial Notional
Amount) thereof divided by the initial Class Certificate Principal Amount (or,
in the case of a Class AX Certificate, the initial Aggregate Notional Amount)
of all Certificates of the same Class. With respect to any Class AX
Certificate, the Percentage Interest evidenced thereby shall be specified on
the face thereof.
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.
Placement Agent: Xxxxxx Brothers Inc.
Plan Asset Regulations: The Department of Labor regulations set forth
in 29 C.F.R. 2510.3-101.
Pool 1: The aggregate of the fully amortizing Mortgage Loans having
original terms to maturity not greater than 15 years as identified on the
Mortgage Loan Schedule.
Pool 1 Discount Mortgage Loan: Any Pool 1 Mortgage Loan with a Net
Mortgage Rate less than 6.25% per annum.
Pool 1 Non-Discount Mortgage Loan: Any Pool 1 Mortgage Loan with a
Net Mortgage Rate greater than or equal to 6.25% per annum.
Pool 1 Premium Mortgage Loan. Any Pool 1 Mortgage Loan with a Net
Mortgage Rate greater than 6.25% per annum.
Pool 1 Rate: 6.25% per annum.
Pool 1 Trust Rate: With respect to a Pool 1 Mortgage Loan, the sum of
the Pool 1 Rate and (b) the Servicing Fee Rate.
Pool 2: The aggregate of the fully amortizing Mortgage Loans having
original terms to maturity not less than 15 years or greater than 30 years as
identified on the Mortgage Loan Schedule.
Pool 2 Discount Mortgage Loan: Any Pool 2 Mortgage Loan with a Net
Mortgage Rate less than 6.50% per annum.
Pool 2 Non-Discount Mortgage Loan: Any Pool 2 Mortgage Loan with a
Net Mortgage Rate greater than or equal to 6.50% per annum.
Pool 2 Premium Mortgage Loan. Any Pool 2 Mortgage Loan with a Net
Mortgage Rate greater than 6.50% per annum.
Pool 2 Rate: 6.50% per annum.
Pool 2 Trust Rate: With respect to a Pool 2 Mortgage Loan, the sum of
the Pool 2 Rate and (b) the Servicing Fee Rate.
Pool Rate: Either of the Pool 1 Rate or the Pool 2 Rate.
Preference Amount: The meaning assigned to such term in the Class
2-A3 Certificate Insurance Policy.
Premium Percentage: The meaning assigned to such term in the
Insurance Agreement.
Prepayment Interest Shortfall: With respect to any full or partial
Principal Prepayment of a Mortgage Loan, the difference between (i) one full
month's interest at the applicable Mortgage Rate (giving effect to any
applicable Relief Act Reduction), as reduced by the Servicing Fee Rate, on the
Scheduled Principal Balance of such Mortgage Loan immediately prior to such
prepayment and (ii) the amount of interest actually received with respect to
such Mortgage Loan in connection with such Principal Prepayment.
Prepayment Period: With respect to any Distribution Date, the
calendar month preceding the month in which such Distribution Date occurs.
Primary Mortgage Insurance Policy: Mortgage guaranty insurance, if
any, on an individual Mortgage Loan, as evidenced by a policy or certificate.
Principal Amount Schedule: The principal amount schedule attached
hereto as Schedule B setting forth the TAC Amounts of the TAC Certificates.
Principal Distribution Amount: With respect to any Distribution Date
and any Certificate Group, the sum of the related Senior Principal
Distribution Amount, the related Subordinate Distribution Amount and the
related AP Principal Distribution Amount.
Principal Only Certificate: Any Class AP Certificate or Class 2-A4
Certificate.
Principal Only Component: The AP(1) Component and the AP(2) Component.
Principal Prepayment: Any Mortgagor payment of principal or other
recovery of principal on a Mortgage Loan that is recognized as having been
received or recovered in advance of its scheduled Due Date and applied to
reduce the principal balance of the Mortgage Loan in accordance with the terms
of the Mortgage Note or Accepted Servicing Practices.
Proceeding: Any suit in equity, action at law or other judicial or
administrative proceeding.
Prospectus: The prospectus supplement dated February 18, 1999
relating to the Group 2 Senior Certificates and the Group 2 Subordinate
Certificates (other than the Class 2-B4, Class 2-B5 and Class 2-B6
Certificates) and the prospectus supplement dated February 23, 1999 relating
to the Group 1 Senior Certificates and the Group 1 Subordinate Certificates
(other than the Class 1-B4, Class 1-B5 and Class 1-B6 Certificates), in each
case together with the accompanying prospectus dated January 15, 1999.
Purchase Price: With respect to the repurchase of a Mortgage Loan
pursuant to Article II of this Agreement, an amount equal to the sum of (a)
100% of the unpaid principal balance of such Mortgage Loan and (b) accrued
interest thereon at the Mortgage Rate, from the date as to which interest was
last paid to (but not including) the Due Date immediately preceding the
related Distribution Date and (c) any amounts advanced by the Servicer (or the
Trustee) not previously reimbursed, together with any unpaid Reimbursement
Amounts due to the Certificate Insurer, and any unpaid amounts due to the
Servicer, in each case with respect to such Mortgage Loan. The Servicer (or
the Trustee, if applicable) shall be reimbursed from the Purchase Price for
any Mortgage Loan or relate REO Property for any Advances made with respect to
such Mortgage Loan or related Mortgage Property that are reimbursable to the
Servicer under the Seller's Warranties and Servicing Agreement (or to the
Trustee hereunder).
Qualified GIC: A guaranteed investment contract or surety bond
providing for the investment of funds in the Collection Account or the
Certificate Account and insuring a minimum, fixed or floating rate of return
on investments of such funds, which contract or surety bond shall:
(a) be an obligation of an insurance company or other corporation
whose long-term debt is rated by each Rating Agency in one of its two highest
rating categories or, if such insurance company has no long-term debt, whose
claims paying ability is rated by each Rating Agency in one of its two highest
rating categories, and whose short-term debt is rated by each Rating Agency in
its highest rating category;
(b) provide that the Trustee may exercise all of the rights under
such contract or surety bond without the necessity of taking any action by any
other Person;
(c) provide that if at any time the then current credit standing of
the obligor under such guaranteed investment contract is such that continued
investment pursuant to such contract of funds would result in a downgrading of
any rating of the Certificates, the Trustee shall terminate such contract
without penalty and be entitled to the return of all funds previously invested
thereunder, together with accrued interest thereon at the interest rate
provided under such contract to the date of delivery of such funds to the
Trustee;
(d) provide that the Trustee's interest therein shall be transferable
to any successor trustee hereunder: and
(e) provide that the funds reinvested thereunder and accrued interest
thereon be returnable to the Collection Account or the Certificate Account, as
the case may be, not later than the Business Day prior to any Distribution
Date.
Qualified Insurer: An insurance company duly qualified as such under
the laws of the states in which the related Mortgaged Properties are located,
duly authorized and licensed in such states to transact the applicable
insurance business and to write the insurance provided and whose claims paying
ability is rated by each Rating Agency in its highest rating category or whose
selection as an insurer will not adversely affect the rating of the
Certificates.
Qualifying Substitute Mortgage Loan: A "Qualified Substitute Mortgage
Loan" as defined in the Seller's Warranties and Servicing Agreement. Whenever
a Qualifying Substitute Mortgage Loan is substituted for a Deleted Mortgage
Loan pursuant to this Agreement, the party effecting such substitution shall
certify such qualification in writing to the Trustee.
Rating Agency: Each of Fitch and S&P; provided, that with respect to
the Group 1 Subordinate Certificates and the Group 2 Subordinate Certificates,
Fitch will be the sole Rating Agency.
Realized Loss: (a) with respect to each Liquidated Mortgage Loan, an
amount equal to (i) the unpaid principal balance of such Mortgage Loan as of
the date of liquidation, plus (ii) interest at the applicable Net Mortgage
Rate from the date as to which interest was last paid up to the last day of
the month of such liquidation, minus (iii) Liquidation Proceeds received, net
of amounts that are reimbursable to the Servicer with respect to such Mortgage
Loan (other than Advances of principal and interest), including expenses of
liquidation, and (b) with respect to each Mortgage Loan that has become the
subject of a Deficient Valuation, the difference between the unpaid principal
balance of such Mortgage Loan immediately prior to such Deficient Valuation
and the unpaid principal balance of such Mortgage Loan as reduced by such
Deficient Valuation. In determining whether a Realized Loss is a Realized Loss
of interest or principal, Liquidation Proceeds shall be allocated, first, to
payment of expenses related to such Liquidated Mortgage Loan (including
payment of any Retained Yield), then to accrued unpaid interest and finally to
reduce the principal balance of the Mortgage Loan.
Record Date: With respect to any Distribution Date, the close of
business on the last Business Day of the month immediately preceding the month
in which such Distribution Date occurs.
Redemption Certificate: Any Class 2-A3 Certificate.
Reference Banks: Not Applicable.
Reimbursement Amount: The meaning assigned to such term in Section
5.02(a)(vi).
Relief Act Reduction: With respect to any Mortgage Loan as to which
there has been a reduction in the amount of interest collectible thereon as a
result of application of the Solders' and Sailors' Civil Relief Act of 1940,
as amended, any amount by which interest collectible on such Mortgage Loan for
the Due Date in the related Collection Period is less than interest accrued
thereon for the applicable one-month period at the Mortgage Rate without
giving effect to such reduction.
REMIC: The Lower Tier REMIC and the Upper Tier 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 86OG of Subchapter M of Chapter 1 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.
Remittance Date: The day in each month on which the Servicer is
required to remit payments to the account maintained by the Trustee, which
shall be the 18th day of each month (or the immediately following Business
Day, if such 18th day is not a Business Day).
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.
Reserve Interest Rate: Not Applicable.
Residual Certificate: Any Class R Certificate.
Responsible Officer: When used with respect to the Trustee, any Vice
President, Assistant Vice President, the Secretary, any assistant secretary,
the Treasurer, or any assistant treasurer, working in its corporate trust
department, or any other officer of the Trustee to whom a matter is referred
because of such officer's knowledge of and familiarity with the particular
subject.
Restricted Certificate: Any Class 1-B4, Class 2-B4, Class 1-B5, Class
2-B5, Class 1-B6 or Class 2-B6 Certificate.
Retained Yield: The meaning assigned to such term in the Seller's
Warranties and Servicing Agreement.
Retained Yield Rate: With respect to any Pool 1 Mortgage Loan which
contains prepayment penalty provisions, a percentage per annum equal to the
lesser of (a) the related Mortgage Rate minus the Pool 1 Trust Rate and (b)
0.50% per annum. With respect to any Pool 1 Mortgage Loan which does not
contain prepayment penalty provisions, a percentage per annum equal to the
lesser of (a) the related Mortgage Rate minus the Pool 1 Trust Rate and (b)
0.25% per annum. With respect to any Pool 2 Mortgage Loan, a percentage per
annum equal to the lesser of (a) the related Mortgage Rate minus the Pool 2
Trust Rate and (b) 0.50% per annum.
Rounding Account: The Class 2-A3 Rounding Account.
S&P: Standard & Poor's Rating Services, a division of The XxXxxx-Xxxx
Companies, Inc., or any successor in interest.
Scheduled Amount: As to any Distribution Date and any Class of
Scheduled Certificates and any Scheduled Component, the amount designated as
such for such Distribution Date and such Class or Component as set forth in
the Principal Amount Schedules.
Scheduled Certificate: None.
Scheduled Component: None.
Scheduled Payment: Each scheduled payment of principal and interest
(or of interest only, if applicable) to be paid by the Mortgagor on a Mortgage
Loan, as reduced (except where otherwise specified herein) by the amount of
any related Debt Service Reduction (excluding all amounts of principal and
interest that were due on or before the Cut-off Date whenever received) and,
in the case of an REO Property, an amount equivalent to the Scheduled Payment
with respect to interest that would have been due on the related Mortgage Loan
if such Mortgage Loan had remained in existence.
Scheduled Principal Amount: As to any Distribution Date, an amount
equal to the amount described in clause (i)(b) of the definition of Senior
Principal Distribution Amount (without application of the related Senior
Percentage).
Scheduled Principal Balance: With respect to (i) any Mortgage Loan as
of any Distribution Date, the principal balance of such Mortgage Loan at the
close of business on the Cut-off Date, after giving effect to principal
payments due on or before the Cut-off Date, whether or not received, less an
amount equal to principal payments due after the Cut-off Date and on or before
the Due Date in the related Due Period, whether or not received from the
Mortgagor or advanced by the Servicer, and all amounts allocable to
unscheduled principal payments (including Principal Prepayments, Liquidation
Proceeds, Insurance Proceeds and condemnation proceeds, in each case to the
extent identified and applied prior to or during the Prepayment Period ending
in the month prior to the month of such Distribution Date) and (ii) with
respect to any REO Property as of any Distribution Date, the Scheduled
Principal Balance of the related Mortgage Loan on the Due Date immediately
preceding the date of acquisition of such REO Property by or on behalf of the
Trustee (reduced by any amount applied as a reduction of principal on the
Mortgage Loan). With respect to any Pool 1 or Pool 2 Mortgage Loan and the
Cut-off Date, a specified in the Mortgage Loan Schedule.
Seller's Warranties and Servicing Agreement: The Seller's Warranties
and Servicing Agreement between First Nationwide Mortgage, as seller and
servicer, and Xxxxxx Capital, as purchaser, dated as of February 1, 1999,
attached hereto as Exhibit E.
Seller: Xxxxxx Capital, a division of Xxxxxx Brothers Holding's Inc.,
or any successor in interest.
Senior Certificate: Any Group 1 Senior Certificate or Group 2 Senior
Certificate.
Senior Percentage: With respect to each Certificate Group and any
Distribution Date, the percentage equivalent of the fraction, the numerator of
which is the aggregate Class Certificate Principal Amount of the related
Senior Certificates (other than, in the case of Group 1, the AP(1) Component
and, in the case of Group 2, the AP(2) Component) immediately prior to such
date and the denominator of which is the sum of the aggregate Class
Certificate Principal Amount of all Classes of related Senior Certificates
(other than, in the case of Group 1, the AP(1) Component and, in the case of
Group 2, the AP(2) Component) and the Class Certificate Principal Amounts of
the related Class of Subordinate Certificates immediately prior to such date.
Senior Prepayment Percentage: With respect to each Certificate Group
and any Distribution Date occurring during the five years beginning on the
first Distribution Date, 100%. The Senior Prepayment Percentage for each
Certificate Group and any Distribution Date occurring on or after the fifth
anniversary of the first Distribution Date will be the related Senior
Percentage plus the following percentage of the related Subordinate Percentage
for such Distribution Date: for any Distribution Date in the first year
thereafter, 70%; for any Distribution Date in the second year thereafter, 60%;
for any Distribution Date in the third year thereafter, 40%; for any
Distribution Date in the fourth year thereafter, 20%; and for any subsequent
Distribution Date, 0%; provided, however, that if on any of the foregoing
Distribution Dates the Senior Percentage for any Certificate Group exceeds the
initial Senior Percentage for such Certificate Group, the Senior Prepayment
Percentage for such Certificate Group for such Distribution Date will once
again equal 100% for such Distribution Date.
Notwithstanding the foregoing, except as provided in the next
succeeding paragraph, no decrease in the Senior Prepayment Percentage below
the level in effect for the most recent prior period set forth in the
paragraph above shall be effective on any Distribution Date if, as of the
first Distribution Date as to which any such decrease applies, (i) the average
outstanding principal balance on such Distribution Date and for the preceding
five Distribution Dates of all Mortgage Loans in the related Mortgage Pool
that were delinquent 60 days or more (including for this purpose any Mortgage
Loans in foreclosure and the Scheduled Payments that would have been due on
Mortgage Loans with respect to which the related Mortgaged Property has been
acquired by the Trust Fund if the related Mortgage Loan had remained in
existence) is greater than or equal to 50% of the sum of (x) the Class
Certificate Principal Amount of the Subordinate Certificates relating to the
Certificate Group immediately prior to such Distribution Date or (ii)
cumulative Realized Losses with respect to the Mortgage Loans in the related
Mortgage Pool exceed (a) with respect to the Distribution Date on the fifth
anniversary of the first Distribution Date, 30% of the Original Group
Subordinate Principal Balance, (b) with respect to the Distribution Date on
the sixth anniversary of the first Distribution Date, 35% of the Original
Group Subordinate Principal Amount, (c) with respect to the Distribution Date
on the seventh anniversary of the first Distribution Date, 40% of the Original
Group Subordinate Principal Amount, (d) with respect to the Distribution Date
on the eighth anniversary of the first Distribution Date, 45% of the Original
Group Subordinate Principal Amount, and (e) with respect to the Distribution
Date on the ninth anniversary of the first Distribution Date, 50% of the
Original Group Subordinate Principal Amount.
Senior Principal Distribution Amount: For any Distribution Date and
each Certificate Group, the sum of the following amounts:
(i) the product of (a) the related Senior Percentage for
such date and (b) the principal portion (multiplied by the applicable
Non-AP Percentage) of each Scheduled Payment (without giving effect
to any Debt Service Reduction occurring prior to the applicable
Bankruptcy Coverage Termination Date), on a Mortgage Loan in the
related Mortgage Pool due during the related Due Period;
(ii) the product of (a) the related Senior Prepayment
Percentage for such date and (b) each of the following amounts
(multiplied by the applicable Non-AP Percentage): (1) each Principal
Prepayment on the Mortgage Loans in the related Mortgage Pool
collected during the related Prepayment Period, (2) each other
unscheduled collection, including Insurance Proceeds and Liquidation
Proceeds (other than with respect to any Mortgage Loan in the related
Mortgage Pool that was finally liquidated during the related
Prepayment Period), representing or allocable to recoveries of
principal received during the related Prepayment Period, and (3) the
principal portion of all proceeds of the purchase of any Mortgage
Loan in the related Mortgage Pool (or, in the case of a permitted
substitution, amounts representing a principal adjustment) actually
received by the Trustee during the related Prepayment Period;
(iii) with respect to unscheduled recoveries allocable
to principal of any Mortgage Loan in the related Mortgage Pool that
was finally liquidated during the related Prepayment Period, the
lesser of (a) the related net Liquidation Proceeds allocable to
principal (multiplied by the applicable Non-AP Percentage) and (b)
the product of the related Senior Prepayment Percentage for such date
and the Scheduled Principal Balance (multiplied by the applicable
Non-AP Percentage) of such related Mortgage Loan at the time of
liquidation; and
(iv) any amounts described in clauses (i) through (iii)
for any previous Distribution Date that remain unpaid.
Servicer: First Nationwide Mortgage, as servicer under the Seller's
Warranties and Servicing Agreement, or any successor in interest.
Servicing Advance: As defined in the Seller's Warranties and
Servicing Agreement.
Servicing Fee: As defined in the Seller's Warranties and Servicing
Agreement.
Servicing Fee Rate: A rate per annum equal to 0.25%.
Servicing Officer: Any officer of the Servicer involved in or
responsible for the administration and servicing of the Mortgage Loans whose
name appears on a list of servicing officers furnished by the Servicer to the
Trustee, as such list may be amended from time to time.
Special Hazard Loss: With respect to the Mortgage Loans, (x) any
Realized Loss arising out of any direct physical loss or damage to a Mortgaged
Property which is caused by or results from any cause, exclusive of any loss
covered by a hazard policy or a flood insurance policy required to be
maintained in respect of such Mortgaged Property and any loss caused by or
resulting from (i) normal wear and tear, (ii) conversion or other dishonest
act on the part of the Trustee, the Servicer or any of their agents or
employees, or (iii) errors in design, faulty workmanship or faulty materials,
unless the collapse of the property or a part thereof ensues, or (y) any
Realized Loss arising from or related to the presence or suspected presence of
hazardous wastes or hazardous substances on a Mortgaged Property unless such
loss is covered by a hazard policy or flood insurance policy required to be
maintained in respect of such Mortgaged Property.
Special Hazard Loss Limit: As of the Cut-off Date, $13,828,944.00,
which amount shall be reduced from time to time to an amount equal on any
Distribution Date to the lesser of (a) the greatest of (i) 1% of the aggregate
of the Scheduled Principal Balances of the Mortgage Loans; (ii) twice the
Scheduled Principal Balance of the Mortgage Loan having the highest Scheduled
Principal Balance, and (iii) the aggregate Scheduled Principal Balances of the
Mortgage Loans secured by Mortgaged Properties located in the single
California postal zip code area having the highest aggregate Scheduled
Principal Balance of Mortgage Loans of any such postal zip code area and (b)
the applicable Special Hazard Loss Limit as of the Closing Date less the
amount, if any, of Special Hazard Losses incurred with respect to the Mortgage
Loans since the Closing Date. All the foregoing calculations shall be
determined on an aggregate basis rather than by Mortgage Pool.
Startup Day: The day designated as such pursuant to Section 10.01(b)
hereof.
Subordinate Certificate: Any Group 1 Subordinate Certificate or Group
2 Subordinate Certificate.
Subordinate Certificate Writedown Amount: With respect to the
Certificate Group and as to any Distribution Date, the amount by which (i) the
sum of the Class Certificate Principal Amounts of all the Certificates in the
related Certificate Group (after giving effect to the distribution of
principal and the application of Realized Losses in reduction of the
Certificate Principal Amounts of the related Certificates on such Distribution
Date) exceeds (ii) the aggregate Scheduled Principal Balance of the Mortgage
Loans on the first day of the month of such Distribution Date.
Subordinate Class Percentage: With respect to any Distribution Date
and any Class of Subordinate Certificates, the percentage obtained by dividing
the Class Certificate Principal Amount of such Class immediately prior to such
Distribution Date by the sum of the Certificate Principal Amounts of all
Subordinate Certificates in the related Certificate Group immediately prior to
such date.
Subordinate Percentage: With respect to any Distribution Date and
each Certificate Group, the difference between 100% and the related Senior
Percentage for such Distribution Date.
Subordinate Prepayment Percentage: With respect to any Distribution
Date and each Certificate Group, the difference between 100% and the Senior
Prepayment Percentage for such Distribution Date.
Subordinate Principal Distribution Amount: For any Distribution Date
and each Certificate Group, the sum of the following:
(i) the product of (a) the related Subordinate
Percentage for such date and (b) the principal portion (multiplied by
the applicable Non-AP percentage) of each Scheduled Payment (without
giving effect to any Debt Service Reduction occurring prior to the
applicable Bankruptcy Coverage Termination Date) on a Mortgage Loan
due during the related Due Period;
(ii) the product of (a) the related Subordinate
Prepayment Percentage for such date and (b) each of the following
amounts (multiplied by the applicable Non-AP percentage): (1) each
Principal Prepayment on the Mortgage Loans in the related Mortgage
Pool collected during the related Prepayment Period, (2) each other
unscheduled collection, including Insurance Proceeds and Net
Liquidation Proceeds (other than with respect to any Mortgage Loan in
the related Mortgage Pool that was finally liquidated during the
related Prepayment Period), representing or allocable to recoveries
of principal received during the related Prepayment Period, and (3)
the principal portion of all proceeds of the purchase of any Mortgage
Loan in the related Mortgage Pool (or, in the case of a permitted
substitution, amounts representing a principal adjustment) actually
received by the Trustee during the related Prepayment Period;
(iii) with respect to unscheduled recoveries allocable
to principal of any Mortgage Loan in the related Mortgage Pool that
was finally liquidated during the related Prepayment Period, the
related Net Liquidation Proceeds allocable to principal (multiplied
by the applicable Non-AP Percentage) less any related amount paid
pursuant to subsection (iii) of the definition of Senior Principal
Distribution Amount for the related Certificate Group; and
(iv) any amounts described in clauses (i) through (iii)
for any previous Distribution Date that remain unpaid.
TAC Amount: As to any Distribution Date and any Class of TAC
Certificates and any TAC Component, the amount designated as such for such
Distribution Date and such Class as set forth in the Principal Amount
Schedule.
TAC Certificate: Any Class 2-A6 Certificates.
TAC Component: None.
Tax Matters Person: The "tax matters person" as defined in the REMIC
Provisions.
Termination Price: As defined in Section 7.01 hereof.
Title Insurance Policy: A title insurance policy maintained with
respect to a Mortgage Loan.
Trust Fund: The corpus of the trust created pursuant to this
Agreement, consisting of the Mortgage Loans, the assignment of the Depositor's
rights under the Mortgage Loan Sale and Assignment Agreement, such amounts as
shall from time to time be held in the Custodial Accounts, the Certificate
Account, the Insurance Policies, any REO Property, the Class 2-A3 Certificate
Insurance Policy, the Class 2-A3 Reserve Fund and the other items referred to
in, and conveyed to the Trustee under, Section 2.01(a).
Trustee: U.S. Bank National Association, or any successor in
interest, 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 Fee: None. (The Trustee's compensation is described in
Section 4.04(c).)
Unscheduled Principal Amount: As to any Distribution Date and for
each Pool 2 Mortgage Loan, the sum of the amounts described in clauses (ii)
and (iii) (without regard to the reference in clause (iii) to the "Senior
Prepayment Percentage") of the definition of Senior Principal Distribution
Amount.
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,
99% of all Voting Interests shall be allocated to the Certificates other than
the Class AX Certificates and 1% of all Voting Interests shall be allocated to
the Class AX Certificates. Voting Interests allocated to the Class AX
Certificates shall be allocated among the Certificates of such Class in
proportion to their respective Percentage Interests. Voting Interests shall be
allocated among the other Classes of Certificates (and among the Certificates
within each such Class) in proportion to their Class Certificate Principal
Amounts (or Certificate Principal Amounts); provided, however, that on and
after the date, if any, on which the Class 2-A3 Certificate Insurer has paid a
claim under the Class 2-A3 Certificate Insurance Policy in respect of the
Class 2-A3 Certificates, the Class 2-A3 Certificate Insurer will be entitled
to exercise all consent, voting and related rights of such class.
Weighted Average Rate: With respect to any Distribution Date, the per
annum variable rate equal to the weighted average of the Net Mortgage Rates of
the Mortgage Loans as of the first day of the calendar month immediately
preceding such Distribution Date.
Section 1.02. Calculations Respecting Mortgage Loans. Calculations
required to be made pursuant to this Agreement with respect to any Mortgage
Loan in the Trust Fund shall be made based upon current information as to the
terms of the Mortgage Loans and reports of payments received from the
Mortgagor on such Mortgage Loans and payments to be made to the Trustee as
supplied to the Trustee by the Servicer. The Trustee shall not be required to
recompute, verify or recalculate the information supplied to it by the
Servicer.
Section 1.03. Calculations Respecting Accrued Interest. Accrued
interest, if any, on any Certificate shall be calculated based upon a 360-day
year consisting of twelve 30-day months.
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, in trust, all the
right, title and interest of the Depositor in and to the Mortgage Loans. Such
conveyance includes, without limitation, the right to all distributions of
principal and interest due with respect to the Mortgage Loans after the
Cut-off Date (exclusive of any Retained Yield), together with all of the
Depositor's right, title and interest in and to the Certificate Account and
all amounts from time to time credited to and the proceeds of the Custodial
Accounts, the Certificate Account, any REO Property and the proceeds thereof,
the Depositor's rights under any Insurance Policies related to the Mortgage
Loans, and the Depositor's security interest in any collateral pledged to
secure the Mortgage Loans, including the Mortgaged Properties, to have and to
hold, in trust; and the Trustee declares that, subject to the review provided
for in the Seller's Warranties and Servicing Agreement, 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. In
addition, the Depositor has caused the Class 2-A3 Certificate Insurer to
deliver the Class 2-A3 Certificate Insurance Policy for the benefit of the
Class 2-A3 Certificateholders and has made an initial deposit to the Class
2-A3 Reserve Fund of $2,000.
Concurrently with the execution and delivery of this agreement, the
Depositor does hereby (i) assign to the Trustee all of its rights and interest
under the Mortgage Loan Sale and Assignment Agreement, which include all of
Xxxxxx Capital's rights and interests under the Seller's Warranties and
Servicing Agreement, and (ii) delegates its obligations under the Mortgage
Loan Sale and Assignment Agreement, which include the obligations of Xxxxxx
Capital under the Seller's Warranties and Servicing Agreement, (which rights
and interests have been assigned and which obligations have been delegated to
the Depositor by Xxxxxx Capital pursuant to the Mortgage Loan Sale and
Assignment Agreement) to the Trustee. The Trustee hereby accepts such
assignment and delegation, and shall be entitled to exercise all such rights,
and obligated to fulfill such obligations, of the Depositor under the Mortgage
Loan Sale and Assignment Agreement and the Seller's Warranties and Servicing
Agreement as if, for such purpose, it were the Depositor.
(b) In connection with such transfer and assignment, the Depositor
does hereby deliver to, and deposit with, or cause to be delivered to and
deposited with, the Custodian, acting on behalf of the Trustee, the documents
or instruments with respect to each Mortgage Loan (each a "Mortgage File") so
transferred and assigned as are specified in the Seller's Warranties and
Servicing Agreement.
The parties hereto acknowledge and agree that the form of endorsement
attached hereto as Exhibit B-2 is intended to effect the transfer to the
Trustee, for the benefit of the Certificateholders, of the Mortgage Notes and
the Mortgages.
(c) Assignments of Mortgage shall be recorded; provided, however,
that such Assignments need not be recorded if, in the Opinion of Counsel
(which must be Independent counsel) acceptable to the Trustee and the Rating
Agencies, recording in such states is not required to protect the Trustee's
interest in the related Mortgage Loans. Subject to the preceding sentence, as
soon as practicable after the Closing Date, the Trustee shall, or shall cause
the Custodian, at the expense of the Depositor, to cause to be properly
recorded in each public recording office where the Mortgages are recorded each
Assignment of Mortgage.
(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-referenced documents, herewith delivers or causes to be
delivered to the Trustee 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 Custodial Account
maintained by the Servicer pursuant to the Seller's Warranties and Servicing
Agreement have been so deposited.
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 or by the Custodian) of the Mortgage Files
pertaining to the Mortgage Loans listed on the Mortgage Loan Schedule, subject
to the review thereof by the Custodian in its capacity as designee of the
Purchaser under the Seller's Warranties and Servicing Agreement and to the
Trustee's review thereof as specified herein. The Custodian has executed and
delivered on or before the Closing Date an initial certification (the "Initial
Certification") certifying as to its receipt of the documents required to be
delivered pursuant to the Seller's Warranties and Servicing Agreement and
identifying any defects in such documents, and delivered such certification to
the Depositor and to First Nationwide Mortgage. Pursuant to Section 3.03 of
the Seller's Warranties and Servicing Agreement, First Nationwide Mortgage is
obligated to cure any Breach (as defined in Section 3.03 of the Seller's
Warranties and Servicing Agreement) identified in such Initial Certification,
or to repurchase the related Mortgage Loan or substitute another mortgage loan
therefor, within 60 days of receipt of such Initial Certification or other
notice of such Breach.
(b) Prior to the first anniversary of the Closing Date, the Trustee
shall deliver (or cause the Custodian to deliver) to the Depositor a Final
Certification substantially in the form annexed hereto as Exhibit B-1
evidencing the completeness of the Mortgage Files in its possession or
control.
(c) Nothing in this Agreement shall be construed to constitute an
assumption by the Trust Fund, the Trustee, the Certificateholders or the Class
2-A3 Certificate Insurer of any unsatisfied duty, claim or other liability on
any Mortgage Loan or to any Mortgagor.
Section 2.03. Representations and Warranties of the Depositor. (a)
The Depositor hereby represents and warrants to the Trustee, for the benefit
of Certificateholders, and to the Class 2-A3 Certificate Insurer, 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, 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, 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;
(b) The representations and warranties of First Nationwide Mortgage
with respect to the Mortgage Loans in the Seller's Warranties and Servicing
Agreement, which have been assigned to the Trustee hereunder, were made as of
February 11, 1999. To the extent that any fact, condition or event with
respect to a Mortgage Loan constitutes a breach of both (i) a representation
or warranty of First Nationwide Mortgage under the Seller's Warranties and
Servicing Agreement and (ii) a representation or warranty of Xxxxxx Capital
under the Mortgage Loan Sale and Assignment Agreement, the only right or
remedy of the Trustee or of any Certificateholder shall be the Trustee's right
to enforce the obligations of First Nationwide Mortgage under any applicable
representation or warranty made by it. The Trustee acknowledges that the
representations and warranties of Xxxxxx Capital in Section 1.04(b) of the
Mortgage Loan Sale and Assignment Agreement are applicable only to facts or
conditions that arise or events that occur subsequent to February 11, 1999,
and which do not constitute a breach of any representation or warranty made by
First Nationwide Mortgage in Section 3.02 of the Seller's Warranties and
Servicing Agreement. The Trustee acknowledges that Xxxxxx Capital shall have
no obligation or liability with respect to any breach of a representation or
warranty made by it with respect to the Mortgage Loans if the fact, condition
or event constituting such breach also constitutes a breach of a
representation or warranty made by First Nationwide Mortgage in Section 3.02
of the Seller's Warranties and Servicing Agreement, without regard to whether
First Nationwide Mortgage fulfills its contractual obligations in respect of
such representation or warranty. The Trustee further acknowledges that the
Depositor shall have no obligation or liability with respect to any breach of
any representation or warranty with respect to the Mortgage Loans under any
circumstances.
Section 2.04. Discovery of Breach. It is understood and agreed that
the representations and warranties set forth in Section 2.03 and the
representations and warranties of First Nationwide Mortgage and Xxxxxx Capital
assigned to the Trustee hereunder survive delivery of the Mortgage Files and
the Assignment of Mortgage of each Mortgage Loan to the Trustee and shall
continue throughout the term of this Agreement. Upon discovery by either the
Depositor, the Trustee or the Class 2-A3 Certificate Insurer of a breach of
any of the representations and warranties set forth in Section 2.03 that
adversely and materially affects the value of the related Mortgage Loan, the
party discovering such breach shall give prompt written notice to the other
parties. Within 90 days of the discovery of such a breach with respect to the
representations and warranties given to the Trustee and the Certificate
Insurer by the Depositor or given by Xxxxxx Capital to the Depositor and
assigned to the Trustee, the Depositor or Xxxxxx Capital, as applicable, shall
either (a) cure such breach in all material respects, (b) repurchase such
Mortgage Loan or any property acquired in respect thereof from the Trustee at
the Purchase Price or (c) within the two year period following the Closing
Date, substitute a Qualifying Substitute Mortgage Loan for the affected
Mortgage Loan.
Section 2.05. Repurchase, Purchase or Substitution of Mortgage Loans.
(a) With respect to any Mortgage Loan repurchased by the Depositor pursuant to
this Article II, by First Nationwide Mortgage pursuant to the Seller's
Warranties and Servicing Agreement or by Xxxxxx Capital pursuant to the
Mortgage Loan Sale and Assignment Agreement, the principal portion of the
funds received by the Trustee in respect of such repurchase of a Mortgage Loan
will be considered a Principal Prepayment and shall be deposited in the
Certificate Account. The Trustee, upon receipt of the full amount of the
Purchase Price for a Deleted Mortgage Loan, or upon receipt of the Mortgage
File for a Qualifying Substitute Mortgage Loan substituted for a Deleted
Mortgage Loan, shall release or cause to be released and reassign to the
Depositor, First Nationwide Mortgage or Xxxxxx Capital, as applicable, the
related Mortgage File for the Deleted Mortgage Loan and shall execute and
deliver such instruments of transfer or assignment, in each case without
recourse, representation or warranty, as shall be necessary to vest in such
party or its designee or assignee title to any Deleted Mortgage Loan released
pursuant hereto, free and clear of all security interests, liens and other
encumbrances created by this Agreement, which instruments shall be prepared by
the Trustee (or the Custodian) at the Depositor's expense, and the Trustee
shall have no further responsibility with respect to the Mortgage File
relating to such Deleted Mortgage Loan.
(b) With respect to each Qualifying Substitute Mortgage Loan to be
delivered to the Trustee (or the Custodian) by the Depositor pursuant to the
terms of this Article II in exchange for a Deleted Mortgage Loan: (i) the
Depositor must deliver to the Trustee (or its custodian) the Mortgage File for
the Qualifying Substitute Mortgage Loan containing the documents set forth in
Section 2.01(b) along with a written certification certifying as to the
delivery of such Mortgage File and containing the granting language set forth
in Section 2.01(a); and (ii) the Depositor or Xxxxxx Capital, as applicable,
will be deemed to have made with respect to such Qualifying Substitute
Mortgage Loan each of the representations made by it with respect to the
Deleted Mortgage Loan. As soon as practicable after the delivery of any
Qualifying Substitute Mortgage Loan hereunder, the Trustee, at the expense of
Xxxxxx Capital and with the cooperation of the Servicer, shall cause the
Assignment of Mortgage with respect to such Qualifying Substitute Mortgage
Loan to be recorded if required pursuant to the first sentence of Section
2.01(c).
(c) Notwithstanding any other provision of this Agreement, the right
to substitute Mortgage Loans pursuant to this Article II shall be subject to
the additional limitations that no substitution of a Qualifying Substitute
Mortgage Loan for a Deleted Mortgage Loan shall be made unless the Trustee has
received an Opinion of Counsel (at the expense of the party seeking to make
the substitution) that, under current law, such substitution will not (A)
affect adversely the status of any REMIC established hereunder as a REMIC, or
of the related "regular interests" as "regular interests" in any such REMIC,
or (B) cause any such REMIC to engage in a "prohibited transaction" or
prohibited contribution pursuant to the REMIC Provisions.
Section 2.06. Grant Clause. 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 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 and
the Class 2-A3 Certificate Insurer 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.
ARTICLE III
THE CERTIFICATES
Section 3.01. The Certificates. (a) The Certificates shall be
issuable in registered form only. 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 Principal Amount or Notional
Amount, as applicable, specified in this paragraph. Each Class of Book-Entry
Certificates other than the Class AX Certificates will be issued in the
minimum denominations in Certificate Principal Amount specified in the
Preliminary Statement hereto and in integral multiples of $1.00 in excess
thereof, except in the case of the Class 2-A2 and the Class 2-A5 Certificates
which may be issued in integral multiples of $1,000 in excess thereof, and the
Class 2-A4 Certificate which will be issued in an amount equal to the initial
Class Certificate Principal Amount for such Class. The Class AX Certificates
will be issued in minimum denominations in Notional Amount of $100,000 and in
multiples of $1,000 in excess thereof. Each Class of Non-Book Entry
Certificates other than the Residual Certificates will be issued in
definitive, fully registered form in the minimum denominations in Certificate
Principal Amount specified in the Preliminary Statement hereto and in integral
multiples of $1.00 in excess thereof. The Residual Certificate will be issued
as a single Certificate and maintained in definitive, fully registered form in
a minimum denomination equal to 100% of the Percentage Interest of such Class.
The Certificates may be issued in the form of typewritten certificates. One
Certificate of each Class of Certificates other than the Residual Certificates
may be issued in any denomination in excess of the minimum denomination.
(b) The Certificates shall be executed by manual or facsimile
signature on behalf of the Trustee by an authorized officer. Each Certificate
shall, on original issue, be authenticated by the Trustee upon the order of
the Depositor upon receipt by the Trustee of the 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 Trustee or the
Authenticating Agent, if any, by manual signature, and such certification upon
any Certificate shall be conclusive evidence, and the only evidence, that such
Certificate has been duly authenticated and delivered hereunder. All
Certificates shall be dated the date of their authentication. At any time and
from time to time after the execution and delivery of this Agreement, the
Depositor may deliver Certificates executed by the Depositor to the Trustee or
the Authenticating Agent for authentication and the Trustee or the
Authenticating Agent shall authenticate and deliver such Certificates as in
this Agreement provided and not otherwise.
Section 3.02. Registration. The Trustee is hereby appointed, and
hereby accepts its appointment as, 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 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 Trustee and the appointment of a successor Trustee. The
Certificate Registrar may appoint, by a written instrument delivered to the
Holders, 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 Trustee shall
execute, and the Trustee or any 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 Principal 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 Principal Amount (or
Notional Amount) as the Certificate surrendered, upon surrender of the
Certificate to be exchanged at the office of the Certificate Registrar duly
endorsed or accompanied by a written instrument of transfer duly executed by
such Holder or his duly authorized attorney in such form as is satisfactory to
the Certificate Registrar. Certificates delivered upon any such exchange will
evidence the same obligations, and will be entitled to the 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
Trustee shall execute, and the Trustee or 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 the Placement Agent, an affiliate (as defined in
Rule 144(a)(1) under the 0000 Xxx) of the Depositor or the Placement
Agent or (y) being made to a "qualified institutional buyer" as
defined in Rule 144A under the Securities Act of 1933, as amended
(the "Act") by a transferor who has provided the Trustee with a
certificate in the form of Exhibit F 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 by a transferor who furnishes to the Trustee a
letter of the transferee substantially in the form of Exhibit G
hereto.
(d) (i) No transfer of an ERISA-Restricted Certificate in the form of
a Definitive Certificate shall be made to any Person unless the Trustee has
received (A) a certificate substantially in the form of Exhibit H hereto from
such transferee or (B) an Opinion of Counsel satisfactory to the Trustee and
the Depositor to the effect that the purchase and holding of such a
Certificate will not constitute or result in the assets of the Trust Fund
being deemed to be "plan assets" subject to the prohibited transactions
provisions of ERISA or Section 4975 of the Code and will not subject the
Trustee or the Depositor to any obligation in addition to those undertaken in
the Agreement; provided, however, that the Trustee 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 Trustee has rendered an opinion to the
effect that the purchase and holding of an ERISA-Restricted Certificate by a
Plan or a Person that is purchasing or holding such a Certificate with the
assets of a Plan will not constitute or result in a prohibited transaction
under ERISA or Section 4975 of the Code. The preparation and delivery of the
certificate and opinions referred to above shall not be an expense of the
Trust Fund, the Trustee or the Depositor. Notwithstanding the foregoing, no
opinion or certificate shall be required for the initial issuance of the
ERISA-Restricted Certificates.
(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 Certificate.
(f) Notwithstanding anything to the contrary contained herein, no
Residual Certificate may be owned, pledged or transferred, directly or
indirectly, by or to a Disqualified Organization or (ii) an individual,
corporation or partnership or other person unless such person is (A) not a
Non-U.S. Person or (B) is a Non-U.S. Person that holds a Residual Certificate
in connection with a trade or business within the United States and has
furnished the transferor and the Trustee with an effective Internal Revenue
Service Form 4224 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 as a "Non-permitted Foreign Holder").
Prior to and as a condition of the registration of any transfer, sale
or other disposition of a Residual Certificate, the proposed transferee shall
deliver to the Trustee an affidavit in substantially the form attached hereto
as Exhibit D-1 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 an affidavit in substantially the form attached
hereto as Exhibit D-2. In addition, the Trustee 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
Depositor and the Trustee satisfactory in form and substance to the Depositor,
that such proposed transferee or, if the proposed transferee is an agent or
nominee, the proposed beneficial owner, is neither a Disqualified
Organization, agent or nominee thereof, nor 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 a 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 Trustee shall not be under any 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 maturity of 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 Trustee 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, agent or
nominee thereof, or Non-permitted Foreign Holder. The Trustee 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 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 Trustee 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 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 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), for making any payment due
on such Certificate to the registered Holder thereof or for taking any other
action with respect to such Holder under the provisions of this Agreement so
long as the transfer was registered upon receipt of the affidavit described in
the preceding paragraph of this Section 3.03(f).
(g) Each Holder of a Residual Certificate, by such Holder'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 Trustee or the Certificate Registrar.
Section 3.05. Replacement of Certificates. If (i) any Certificate is
mutilated and is surrendered to the Trustee or any Authenticating Agent or
(ii) the Trustee or any Authenticating Agent receives evidence to its
satisfaction of the destruction, loss or theft of any Certificate, and there
is delivered to the Trustee or the Authenticating Agent 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 and any Authenticating Agent that such
destroyed, lost or stolen Certificate has been acquired by a bona fide
purchaser, the Trustee shall execute and the Trustee or any 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 Principal Amount. Upon the issuance of any new
Certificate under this Section 3.05, the Trustee and Authenticating Agent 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 or the Authenticating Agent)
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.
Section 3.06. Persons Deemed Owners. Subject to the provisions of
Section 3.09 with respect to Book-Entry Certificates, the Depositor, the
Trustee, the Certificate Registrar and any agent of any of them may 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 Trustee, the Certificate
Registrar nor any agent of any of them shall be affected by notice to the
contrary.
Section 3.07. Temporary Certificates. (a) Pending the preparation of
definitive Certificates, upon the order of the Depositor, the Trustee shall
execute and 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 Trustee without charge to the
Holder. Upon surrender for cancellation of any one or more temporary
Certificates, the Trustee shall execute and authenticate and deliver in
exchange therefor a like aggregate Certificate Principal Amount 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 Certificateholders hereunder. The Trustee shall cause such
Paying Agent (other than Trustee) 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
Certificateholders in an Eligible 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 Trustee to any such Paying Agent
for the purpose of making distributions shall be paid to Certificateholders on
each Distribution Date and any amounts not so paid shall be returned on such
Distribution Date to the Trustee. If the Paying Agent is not the Trustee, the
Trustee 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, to be
delivered to The Depository Trust Company, the initial Clearing Agency, by, or
on behalf of, the Depositor. The Book-Entry Certificates shall initially be
registered on the Certificate Register in the name of the nominee of the
Clearing Agency, and no Certificate Owner will receive a definitive
certificate representing such Certificate Owner's interest in the Book-Entry
Certificates, except as provided in Section 3.09(c). Unless Definitive
Certificates have been issued to Certificate Owners of Book-Entry Certificates
pursuant to Section 3.09(c):
(i) the provisions of this Section 3.09 shall be in full
force and effect;
(ii) the Depositor, the Paying Agent, the Registrar and
the Trustee may 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 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
Trustee 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 Depositor advises the Trustee 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
Trustee or the Depositor is unable to locate a qualified successor, (ii) the
Depositor, at its option, advises the Trustee in writing that it elects to
terminate the book-entry system through the Clearing Agency or (iii) after the
occurrence of an Event of Default, Certificate Owners representing beneficial
interests aggregating not less than 50% of the Class Certificate Principal
Amount of a Class of Book-Entry Certificates identified as such to the Trustee
by an Officer's Certificate from the Clearing Agency advise the Trustee 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 Trustee shall notify or cause the Certificate
Registrar to 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 Trustee of the Book-Entry
Certificates by the Clearing Agency, accompanied by registration instructions
from the Clearing Agency for registration, the Trustee shall issue the
Definitive Certificates. Neither the Transferor nor the Trustee shall be
liable for any delay in delivery of such instructions and may conclusively
rely on, and shall be protected in relying on, such instructions. Upon the
issuance of Definitive Certificates all references herein to obligations
imposed upon or to be performed by the Clearing Agency shall be deemed to be
imposed upon and performed by the Trustee, to the extent applicable, with
respect to such Definitive Certificates and the Trustee shall recognize the
holders of the Definitive Certificates as Certificateholders hereunder.
ARTICLE IV
ADMINISTRATION OF THE TRUST FUND
Section 4.01. [Omitted].
Section 4.02. [Omitted].
Section 4.03. Reports to Certificateholders. (a) On each Distribution
Date, the Trustee shall deliver or cause to be delivered by first class mail
to each Certificateholder and the Class 2-A3 Certificate Insurer a written
report setting forth the following information, by Mortgage Pool and
Certificate Group, which information the Trustee will determine on the basis
of, with respect to the Mortgage Loans, data which the Servicer will provide
to the Trustee or its designee prior to the Remittance Date:
(i) the aggregate amount of the distribution to be made
on such Distribution Date to the Holders of each Class of
Certificates (and in respect of any Component), other than any Class
of Notional Certificates (or any Notional Component), allocable to
principal on the Mortgage Loans, including Liquidation Proceeds and
Insurance Proceeds, stating separately the amount attributable to
scheduled principal payments and unscheduled payments in the nature
of principal in each Mortgage Pool;
(ii) the aggregate amount of the distribution to be made
on such Distribution Date to the Holders of each Class of
Certificates (other than any Class of Principal Only Certificates)
allocable to interest, including any Accrual Amount added to the
Class Certificate Principal Amount of any Class of Accrual
Certificates;
(iii) the amount, if any, of any distribution to the
Holder of the Residual Certificates;
(iv) the aggregate amount of any Advances in respect of
the Mortgage Loans in each Mortgage Pool made by or on behalf of the
Servicer (or the Trustee) included in the amounts actually
distributed to the Certificateholders;
(v) the aggregate Scheduled Principal Balance of the
Mortgage Loans in each Mortgage Pool as of the close of business on
the last day of the related Due Period, after giving effect to
payments allocated to principal reported under clause (i) above;
(vi) the Class Certificate Principal Amount (or
Aggregate Notional Amount) of each Class of Certificates as of such
Distribution Date after giving effect to payments allocated to
principal reported under clause (i) above (and to the addition of any
Accrual Amount in the case of any Class of Accrual Certificates),
separately identifying any reduction of any of the foregoing
Certificate Principal Amounts due to Realized Losses:
(vii) any Realized Losses realized with respect to the
Mortgage Loans (x) in the related Prepayment Period and (y) in the
aggregate since the Cut-off Date, stating separately the amount of
Special Hazard Losses, Fraud Losses and Bankruptcy Losses and the
aggregate amount of such Realized Losses, and the remaining Special
Hazard Loss Amount, Fraud Loss Amount and Bankruptcy Loss Amount;
(viii) the amount of the Servicing Fees paid during the
Due Period to which such distribution relates;
(ix) the number and aggregate Scheduled Principal
Balance of Mortgage Loans, as reported to the Trustee by the
Servicer, (a) remaining outstanding (b) delinquent one month, (c)
delinquent two months, (d) delinquent three or more months, and (e)
as to which foreclosure proceedings have been commenced as of the
close of business on the last Business Day of the calendar month
immediately preceding the month in which such Distribution Date
occurs;
(x) the deemed principal balance of each REO Property as
of the close of business on the last Business Day of the calendar
month immediately preceding the month in which such Distribution Date
occurs;
(xi) with respect to any Mortgage Loan that became an
REO Property during the preceding calendar month, the principal
balance of such Mortgage Loan and the number of such Mortgage Loans
as of the close of business on the Distribution Date in such
preceding month;
(xii) with respect to substitution of Mortgage Loans in
the preceding calendar month, the Scheduled Principal Balance of each
Deleted Mortgage Loan, and of each Qualifying Substitute Mortgage
Loan;
(xiii) the aggregate outstanding Interest Shortfalls and
Net Prepayment Interest Shortfalls, if any, for each Class of
Certificates, after giving effect to the distribution made on such
Distribution Date;
(xiv) the Certificate Interest Rate applicable to such
Distribution Date with respect to each Class of Certificates;
(xv) if applicable, the amount of any shortfall (i.e.,
the difference between the aggregate amounts of principal and
interest which Certificateholders would have received if there were
sufficient available amounts in the Certificate Account and the
amounts actually distributed);
(xvi) any other "loan-level" information for any
Mortgage Loans that are delinquent three or more months and any REO
Property held by the Trust that is reported by the Servicer to the
Trustee;
(xvii) The Purchase Price of any Mortgage Loan
repurchased pursuant to Section 2.05; and
(xviii) any Insured Payments made in respect of
Guaranteed Distributions paid under the Class 2-A4 Certificate
Insurance Policy.
In the case of information furnished pursuant to subclauses (i), (ii)
and (viii) above, the amounts shall be expressed as a dollar amount per $1,000
of original principal amount of Certificates.
On each Distribution Date, the Trustee shall also deliver or cause to
be delivered by first class mail to the Depositor a copy of the
above-described written report, to the following address: Mortgage Finance
Group, Xxxxxx Brothers Inc., Three World Financial Center, 000 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxx X. Xxxxx, Vice President, or to
such other address as the Depositor may designate.
(b) Upon the reasonable advance written request of any
Certificateholder that is a savings and loan, bank or insurance company, the
Trustee shall, to the extent that such information has been provided to the
Trustee by the Servicer, provide, or cause to be provided (or, to the extent
that such information or documentation is not required to be provided by the
Servicer under the Seller's Warrants and Servicing Agreement, shall use
reasonable efforts to obtain such information and documentation from the
Servicer and provide), to such Certificateholder such reports and access to
information and documentation regarding the Mortgage Loans as such
Certificateholder 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 investment in the Certificates;
provided, however, that the Trustee shall be entitled to be reimbursed by such
Certificateholder for such Trustee's actual expenses incurred in providing
such reports and access.
(c) Within 90 days, or such shorter period as may be required by
statute or regulation, after the end of each calendar year, the Trustee shall
send to each Person who at any time during the calendar year was a
Certificateholder of record, and make available to Certificate Owners
(identified as such by the Clearing Agency) in accordance with applicable
regulations, a report summarizing the items provided to Certificateholders
pursuant to Section 4.03(a) on an annual basis as may be required to enable
such Holders to prepare their federal income tax returns. Such information
shall include the amount of original issue discount accrued on each Class of
Certificates and information regarding the expenses of the Trust Fund.
(d) Not later than two days following each Distribution Date, the
Trustee shall deliver to the Persons designated by the Depositor, in the
format provided by the Servicer, "loan level" information with respect to the
Mortgage Loans as of the related Determination Date, to the extent that such
information has been provided in electronic format to the Trustee by the
Servicer.
Section 4.04. Certificate Account. (a) The Trustee shall establish
and maintain in its name, as trustee, a special deposit trust account (the
"Certificate Account"), to be held in trust for the benefit of the
Certificateholders and the Class 2-A3 Certificate Insurer until disbursed
pursuant to the terms of this Agreement. The Certificate Account shall be an
Eligible Account. If the existing Certificate Account ceases to be an Eligible
Account, the Trustee shall establish a new Certificate Account that is an
Eligible Account within 20 Business Days and transfer all funds on deposit in
such existing Certificate Account into such new Certificate Account. The
Certificate Account shall relate solely to the Certificates issued hereunder
and funds in the Certificate Account shall be held separate and apart from and
shall not be commingled with any other monies including, without limitation,
other monies of the Trustee held under this Agreement.
(b) The Trustee shall cause to be deposited into the Certificate
Account on the day on which, or, if such day is not a Business Day, the
Business Day immediately following the day on which, any monies are remitted
by the Servicer to the Trustee, all such amounts. The Trustee shall make
withdrawals from the Certificate Account only for the following purposes:
(i) to withdraw amounts deposited in the Certificate
Account in error;
(ii) to pay itself any investment income earned with
respect to funds in the Certificate Account invested in Eligible
Investments as set forth in subsection (c) below, and to make payment
to itself and others pursuant to any provision of this Agreement;
(iii) to make distributions to the Certificateholders
and the Class 2-A3 Certificate Insurer pursuant to Article V; and
(iv) to clear and terminate the Certificate Account
pursuant to Section 7.02.
(c) The Trustee may invest, or cause to be invested, funds held in
the Certificate Account in Eligible Investments (which may be obligations of
the Trustee). All such investments must mature no later than the next
Distribution Date, and shall not be sold or disposed of prior to their
maturity. All such Eligible Investments will be made in the name of the
Trustee (in its capacity as such) or its nominee. All income and gain realized
from any such investment shall be compensation for the Trustee and shall be
subject to its withdrawal on order from time to time. The amount of any losses
incurred in respect of any such investments shall be paid by the Trustee for
deposit in the Certificate Account out of its own funds immediately as
realized.
Section 4.05. Determination of LIBOR. [RESERVED]
Section 4.06. The Class 2-A3 Reserve Fund. (a) The Trustee shall
establish and maintain the Class 2-A3 Reserve Fund, which shall be an
interest-bearing Eligible Account into which there shall have been deposited
the amount of $2,000 on the Closing Date. No additional funds will be
deposited in the Class 2-A3 Reserve Fund after the Closing Date. All funds
deposited in the Class 2-A3 Reserve Fund, other than investment earnings
thereon which shall be released by the Trustee to the Depositor, shall be held
in trust for the benefit of the Holders of the Class 2-A3 Certificates until
withdrawn in accordance with Section 5.02(d). The Class 2-A3 Reserve Fund
shall be an "outside reserve fund" under the REMIC Provisions. Xxxxxx Brothers
Inc. will be the beneficial owner of the Class 2-A3 Reserve Fund for federal
and state income tax purposes. The Trustee, upon the instructions of the
Depositor, may invest, or cause to be invested, funds in the Class 2-A4
Reserve Fund in Eligible Investments (which may be the obligation of the
Trustee).
(b) The Trustee shall from time to time make withdrawals from the
Class 2-A3 Reserve Fund on behalf of the Trust Fund for the following
purposes:
(i) prior to each Distribution Date, to withdraw from
the Class 2-A3 Reserve Fund an amount equal to the lesser of (a) any
Net Prepayment Interest Shortfalls for Pool 2 allocable to the Class
2-A3 Certificates for the related Distribution Date, and (b) the
amount on deposit in the Class 2-A3 Reserve Fund, and remit such
amount to the Certificate Account for distribution to the Class 2-A3
Certificateholders on such Distribution Date; and
(ii) on the earlier of (a) the Distribution Date on
which the Class Certificate Principal Amount of the Class 2-A3
Certificates is reduced to zero and (b) the termination of this
Agreement pursuant to Section 7.01, to clear and terminate the Class
2-A3 Reserve Fund and to pay all amounts on deposit therein to Xxxxxx
Brothers Inc. at the address supplied by it to the Trustee for such
purpose.
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 Trustee or the Paying Agent shall make 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 (which shall initially be the Trustee) or, upon written
request made to the Trustee at least three Business Days prior to the related
Distribution Date by (x) any Certificateholder owning the entire interest in
the Class 2-A4, Class 1-B1, Class 1-B2 or Class 1-B3 Certificates, (y) any
Certificateholder owning an aggregate initial Certificate Principal Amount of
at least $2,500,000, (or, in the case of the Class AX Certificates, a
Percentage Interest of not less than 50%) 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 Corporate Trust Office. 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, the Residual Certificates 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 Certificates will be made
only upon presentation and surrender of such Certificate at the Corporate
Trust Office of the Trustee or at the office of the Trustee's New York
presenting agent. 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. Payments to the Class 2-A3 Certificate
Insurer shall in all cases be made by wire transfer of immediately available
funds.
(b) All distributions or allocations made with respect to
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 Certificate Principal Amounts (or
initial Notional Amounts).
Section 5.02. Distributions from the Certificate Account. (a) On each
Distribution Date the Trustee (or the Paying Agent on behalf of the Trustee)
shall withdraw from the Certificate Account the Available Distribution Amount
with respect to each Mortgage Pool, and shall distribute such amount to the
Class 2-A3 Certificate Insurer in payment of the Aggregate Class 2-A3
Certificate Insurance Premium and to the Holders of record of each Class of
Certificates in the related Certificate Group in the following order of
priority:
(i) from the Available Distribution Amount for Pool 2,
to the Class 2-A3 Certificate Insurer, the Aggregate Class 2-A3
Certificate Insurance Premium;
(ii) from the Available Distribution Amount for the
related Mortgage Pool, to each Class of Senior Certificates (or
Component thereof) in the related Certificate Group (other than any
Class of Principal Only Certificates or Component thereof), the
Accrued Certificate Interest thereon for such Distribution Date, as
reduced by such Class's or Component's pro rata share (determined on
the basis of Accrued Certificate Interest otherwise distributable
thereon) of any Net Prepayment Interest Shortfalls for the related
Mortgage Pool for such Distribution Date; provided, however, that any
shortfall in available amounts shall be allocated among such Classes
or Components in proportion to the amount of Accrued Certificate
Interest (as so reduced) that would otherwise be distributable
thereon; provided, further, that on each Distribution Date through
the Class 2-A2 Accretion Termination Date, such amounts otherwise
distributable with respect to the Class 2-A2 Certificates shall not
be distributed under this priority (ii), but shall instead be added
to the Class Certificate Principal Amount thereof and distributed in
accordance with subparagraph d(i) below; and provided further, on
each Distribution Date through the Class 2-A5 Accretion Termination
Date, such amounts otherwise distributable with respect to the Class
2-A5 Certificates will not be distributed under this priority (ii),
but will instead be added to the Class Certificate Principal Amount
thereof and distributed in accordance with subparagraph (d)(ii)
below.
(iii) from the remaining Available Distribution Amount
for the related Mortgage Pool, to each Class of Senior Certificates
(or Component thereof) in the related Certificate Group (other than
any Class of Principal Only Certificates), any related Interest
Shortfall for such Distribution Date; provided, however, that any
shortfall in available amounts shall be allocated among such Classes
or Components in proportion to the Interest Shortfall for each such
Class or Component on such Distribution Date; provided, further, that
through the Class 2-A2 Accretion Termination Date, in the case of the
Class 2-A2 Certificate, or the Class 2-A5 Accretion Termination, in
the case of the Class 2-A5 Certificate, such amounts with respect to
such Certificates will not be distributed to either such Class under
this priority (iii), but will instead be added to the Class
Certificate Principal Amounts of such Class and distributed in
accordance with subparagraphs (d)(i) and (d)(ii) below.
(iv) from the remaining Available Distribution Amount
for the related Mortgage Pool, to the Senior Certificates of each
Certificate Group, as follows:
(A) to the payment of principal on the Group 1
Senior Certificates (other than the Notional Certificates or
the Components thereof), in reduction of their respective
Class Certificate Principal Amounts (or Component Principal
Amounts), concurrently, as follows:
(1) to the Class 1-A Certificates, the
Senior Principal Distribution Amount for Pool 1 for
such Distribution Date until the Class Certificate
Principal Amount thereof has been reduced to zero;
and
(2) to the AP(1) Component of the Class AP
Certificates, the AP Principal Distribution Amount
for Pool 1 for such Distribution Date, until the
Component Principal Amount thereof has been reduced
to zero; and
(B) to the payment of principal on the Group 2
Senior Certificates (other than the Notional Certificates or
the Components thereof), in reduction of their Class
Certificate Principal Amounts (or Component Principal
Amounts), concurrently as follows:
(1) to the Group 2 Senior Certificates
(other than the AX(2) Component and the AP(2)
Component) in the following order of priority:
(x) to the Class 2-A7
Certificates, the lesser of (i) the Class
2-A7 Priority Amount for such Distribution
Date and (ii) 98.6% of the Senior
Principal Distribution Amount for Group 2
until the Class Certificate Principal
Amount thereof has been reduced to zero;
(y) to the Group 2 Senior
Certificates (other than the AX(2)
Component and the AP(2) Component),
concurrently as follows:
(I) to the Class 2-A2, Class A3, Class
2-A4, Class 2-A6 and Class 2-A8 Certificates,
53.0000000000% of the Senior Principal Distribution
Amount for Group 2 for such Distribution Date
(after application of priority (iv)(B)(1)(x)), in
the following order of priority:
(a) if such Distribution Date
occurs on or after the Distribution Date
in March 2002, to the Class 2-A3
Certificates and Class 2-A4 Certificates,
pro rata in proportion to their respective
Class Certificate Principal Amounts
outstanding, an amount on each
Distribution Date up to $21,589.10, until
the Class Certificate Principal Amounts of
each such Class has been reduced to zero;
(b) to the Class 2-A8
Certificates, 58.0611936524% of the
remaining Senior Principal Distribution
Amount for Group 2 (after application of
the priorities through
(iv)(B)(1)(y)(I)(a)), until the Class
Certificate Principal Amount thereof has
been reduced to zero;
(c) to the Class 2-A2 and Class
2-A6 Certificates, the remaining Senior
Principal Distribution Amount for Group 2
(after application of the priorities
through (iv)(B)(I)(y)(1)(b)) in the
following order of priority:
(i) to the Class 2-A6 Certificates,
up to an amount necessary to reduce the
Class Certificate Principal Amount thereof
to its TAC Amount for such Distribution
Date;
(ii) to the Class 2-A2 Certificates,
until the Class Certificate Principal
Amount thereof has been reduced to zero;
(iii) to the Class 2-A6 Certificates
without regard to its TAC Amount, until
the Class Certificate Principal Amount
thereof has been reduced to zero; and
(d) to the Class 2-A3 and Class 2-A4
Certificates, pro rata in proportion to their
respective Class Certificate Principal Amounts
outstanding, until the Class Certificate Principal
Amount of each such Class has been reduced to zero;
and
(II) to the Class 2-Al, Class 2-A5, Class R and
Class 2-A7 Certificates, sequentially, in that order, the
remaining Senior Principal Distribution Amount for Group 2
until the Class Certificate Principal Amount of each such
Class has been reduced to zero; and
(2) to the AP(2) Component of the Class AP
Certificates, the AP Principal Distribution Amount for such
Distribution Date, until the Component Principal Amount
thereof has been reduced to zero;
(v) to the AP(1) Component and AP(2) Component of the
Class AP Certificates, to the extent of the remaining Available
Distribution Amount for Group 1 (in the case of the AP(1) Component)
and Group 2 (in the case of the AP(2) Component), concurrently as
follows:
(A) to the AP(1) Component of the Class AP
Certificates, from the Available Distribution Amount for
Pool 1 for such Distribution Date, the AP(1) Deferred Amount
for such Distribution Date, until the Component Principal
Amount thereof has been reduced to zero; provided, that
distributions pursuant to this priority (v) (A) shall not
exceed the Subordinate Principal Distribution Amount for
Group 1 for such Distribution Date, and such distributions
shall not reduce the Component Principal Amount of such
AP(1) Component;
(B) to the AP(2) Component of the Class AP
Certificates, from the Available Distribution Amount for
Pool 2 for such Distribution Date, the AP(2) Deferred Amount
for such Distribution Date, until the Component Principal
Amount thereof has been reduced to zero; provided, that
distributions pursuant to this priority (v)(B) shall not
exceed the Subordinate Principal Distribution Amount for
Group 2 for such Distribution Date, and such distributions
shall not reduce the Component Principal Amount of such
AP(2) Component; and
(vi) to the Class 2-A3 Certificate Insurer, payment of
any unreimbursed Insured Payments, plus all amounts due to the Class
2-A3 Certificate Insurer under the Insurance Agreement, together with
interest thereon at the rate specified in the Insurance Agreement
(collectively, the "Reimbursement Amounts"); and
(vii) from the remaining Available Distribution Amount
for the related Mortgage Pool, to the Subordinate Certificates of
each Certificate Group, as follows:
(A) to the Class 1-B1 and Class 2-B1 Certificates,
the Accrued Certificate Interest thereon for such
Distribution Date, as reduced by such Class's pro rata share
(determined on the basis of Accrued Certificate Interest
otherwise distributable thereon) of any Net Prepayment
Interest Shortfalls for the related Mortgage Pool for such
Distribution Date;
(B) to the Class 1-B1 and Class 2-B1 Certificates,
any Interest Shortfall for such Class on such Distribution
Date;
(C) to the Class 1-B1 and Class 2-B1 Certificates,
in reduction of their respective Class Certificate Principal
Amounts, such Class's Subordinate Class Percentage of the
Subordinate Principal Distribution Amount for the related
Certificate Group for such Distribution Date, except as
provided in Section 5.02(c), until the Class Certificate
Principal Amount of each such Class has been reduced to
zero;
(D) to the Class 1-B2 and Class 2-B2 Certificates,
the Accrued Certificate Interest thereon for such
Distribution Date, as reduced by such Class's pro rata share
(determined on the basis of Accrued Certificate Interest
otherwise distributable thereon) of any Net Prepayment
Interest Shortfalls for the related Mortgage Pool for such
Distribution Date;
(E) to the Class 1-B2 and Class 2-B2 Certificates,
any Interest Shortfall for such Class on such Distribution
Date;
(F) to the Class 1-B2 and Class 2-B2 Certificates,
in reduction of the their respective Class Certificate
Principal Amounts, such Class's Subordinate Class Percentage
of the Subordinate Principal Distribution Amount for the
related Certificate Group for such Distribution Date, except
as provided in Section 5.02(c), until the Class Certificate
Principal Amount of each such Class has been reduced to
zero;
(G) to the Class 1-B3 and Class 2-B3 Certificates,
the Accrued Certificate Interest thereon for such
Distribution Date, as reduced by such Class's pro rata share
(determined on the basis of Accrued Certificate Interest
otherwise distributable thereon) of any Net Prepayment
Interest Shortfalls for the related Mortgage Pool for such
Distribution Date;
(H) to the Class 1-B2 and Class 2-B3 Certificates,
any Interest Shortfall for such Class on such Distribution
Date;
(I) to the Class 1-B3 and Class 2-B3 Certificates,
in reduction of their respective Class Certificate Principal
Amounts, such Class's Subordinate Class Percentage of the
Subordinate Principal Distribution Amount for the related
Certificate Group for such Distribution Date, except as
provided in Section 5.02(c), until the Class Certificate
Principal Amount of each such Class has been reduced to
zero;
(J) to the Class 1-B4 and Class 2-B4 Certificates,
the Accrued Certificate Interest thereon for such
Distribution Date, as reduced by such Class's pro rata share
(determined on the basis of Accrued Certificate Interest
otherwise distributable thereon) of any Net Prepayment
Interest Shortfalls for the related Mortgage Pool for such
Distribution Date;
(K) to the Class 1-B4 and Class 2-B4 Certificates,
any Interest Shortfall for such Class on such Distribution
Date;
(L) to the Class 1-B4 and Class 2-B4 Certificates,
in reduction of their respective Class Certificate Principal
Amounts, such Class's Subordinate Class Percentage of the
Subordinate Principal Distribution Amount for the related
Certificate Group for such Distribution Date, except as
provided in Section 5.02(c), until the Class Certificate
Principal Amount of each such Class has been reduced to
zero;
(M) to the Class 1-B5 and Class 2-B5 Certificates,
the Accrued Certificate Interest thereon for such
Distribution Date, as reduced by such Class's pro rata share
(determined on the basis of Accrued Certificate Interest
otherwise distributable thereon) of any Net Prepayment
Interest Shortfalls for the related Mortgage Pool for such
Distribution Date;
(N) to the Class 1-B5 and Class 2-B5 Certificates,
any Interest Shortfall for such Class on such Distribution
Date;
(O) to the Class 1-B5 and Class 2-B5 Certificates,
in reduction of their respective Class Certificate Principal
Amounts, such Class's Subordinate Class Percentage of the
Subordinate Principal Distribution Amount for the related
Certificate Group for such Distribution Date, except as
provided in Section 5.02(c), until the Class Certificate
Principal Amount of each such Class has been reduced to
zero;
(P) to the Class 1-B6 and Class 2-B6 Certificates,
the Accrued Certificate Interest thereon for such
Distribution Date, as reduced by such Class's pro rata share
(determined on the basis of Accrued Certificate Interest
otherwise distributable thereon) of any Net Prepayment
Interest Shortfalls for the related Mortgage Pool for such
Distribution Date;
(Q) to the Class 1-B6 and Class 2-B6 Certificates,
any Interest Shortfall for such Class on such Distribution
Date; and
(R) to the Class 1-B6 and Class 2-B6 Certificates,
in reduction of their respective Class Certificate Principal
Amounts, such Class's Subordinate Class Percentage of the
Subordinate Principal Distribution Amount for the related
Certificate Group for such Distribution Date, except as
provided in Section 5.02(c), until the Class Certificate
Principal Amount of each such Class has been reduced to
zero.
(b) If on any Distribution Date (i) the aggregate Class Certificate
Principal Amounts of the Subordinate Certificates of a Certificate Group have
been reduced to zero, the Available Distribution Amount with respect to the
related Mortgage Pool remaining after distribution of interest to the related
Senior Certificates on such date shall be distributed among the related
Classes of Senior Certificates pro rata, on the basis of their respective
Class Certificate Principal Amounts immediately prior to such Distribution
Date, regardless of the priorities and amounts set forth in Sections
5.02(a)(iv)(A) and (B).
(c) (i) If on any Distribution Date the Credit Support Percentage for
the Class 1-B1 or Class 2-B1 Certificates is less than the Original Credit
Support Percentage for such Class, then, notwithstanding anything to the
contrary in Section 5.02(a), no distribution of amounts described in clauses
(ii) and (iii) of the definition of Subordinate Principal Distribution Amount
will be made in respect of the Class B2, Class B3, Class B4, Class B5 or Class
B6 Certificates in the related Certificate Group on such Distribution Date.
(ii) If on any Distribution Date the Credit Support Percentage for the Class
1-B2 and Class 2-B2 Certificates is less than the Original Credit Support
Percentage for such Class, then, notwithstanding anything to the contrary in
Section 5.02(a), no distribution of amounts described in clauses (ii) and
(iii) of the definition of Subordinate Principal Distribution Amount will be
made in respect of the Class B3, Class B4, Class B5 or Class B6 Certificates
in the related Certificate Group on such Distribution Date. (iii) If on any
Distribution Date the Credit Support Percentage for the Class 1-B3 and Class
2-B3 Certificates is less than the Original Credit Support Percentage for such
Class, then, notwithstanding anything to the contrary in Section 5.02(a), no
distribution of amounts described in clauses (ii) and (iii) of the definition
of Subordinate Principal Distribution Amount will be made in respect of the
Class B4, Class B5 or Class B6 Certificates in the related Certificate Group
on such Distribution Date. (iv) If on any Distribution Date the Credit Support
Percentage for the Class 1-B4 and Class 2-B4 Certificates is less than the
Original Credit Support Percentage for such Class, then, notwithstanding
anything to the contrary in Section 5.02(a), no distribution of amounts
described in clauses (ii) and (iii) of the definition of Subordinate Principal
Distribution Amount will be made in respect of the Class B5 or Class B6
Certificates in the related Certificate Group on such Distribution Date. (v)
If on any Distribution Date the Credit Support Percentage for the Class 1-B5
or Class 2-B5 Certificates is less than the Original Credit Support Percentage
for such Class, then, notwithstanding anything to the contrary in Section
5.02(a), no distribution of amounts described in clauses (ii) and (iii) of the
definition of Subordinate Principal Distribution Amount will be made in
respect of the Class B6 Certificates in the related Certificate Group on such
Distribution Date.
Any amount not distributed in respect of any Class of Subordinate
Certificates on any Distribution Date pursuant to the immediately preceding
paragraph will be allocated among the remaining Classes or Components of the
related Certificate Group in proportion to their respective Class Certificate
Principal Amounts, as applicable.
(d)(i) On each Distribution Date through the Class 2-A2 Accretion
Termination Date, before distribution of any amounts pursuant to priority
(iv)(B)(1)(y)(I)(c) above, an amount equal to the Class 2-A2 Accrual Amount
for such Distribution Date will be distributed in the following order of
priority:
first, to the Class 2-A6 Certificates, in an amount
necessary to reduce the Class Certificate Principal Amount thereof to
its TAC Amount for such Distribution Date, until the Class
Certificate Principal Amount thereof has been reduced to zero; and
second, to the Class 2-A2 Certificates, in reduction of the
Class Certificate Principal Amount thereof, until the Class
Certificate Principal Amount thereof has been reduced to zero.
On each Distribution Date after the Class 2-A2 Accretion Termination
Date, the Accrued Certificate Interest allocable to the Class 2-A2
Certificates pursuant to priorities (ii) and (iii) above will be distributable
as interest thereon and not be added to the Class Certificate Principal Amount
thereof.
(d)(ii) On each Distribution Date through the Class 2-A5 Accretion
Termination Date, before distribution of any amounts pursuant to priority
(iv)(B)(1)(y)(II) above, an amount equal to the Class 2-A5 Accrual Amount for
such date will be distributed in the following order of priority:
first, to the Class 2-A1 Certificates, in reduction of the
Class Certificate Principal Amount thereof, until the Class
Certificate Principal Amount thereof has been reduced to zero; and
second, to the Class 2-A5 Certificates, in reduction of the
Class Certificate Principal Amount thereof, until the Class
Certificate Principal Amount thereof has been reduced to zero.
On each Distribution Date after the Class 2-A5 Accretion Termination
Date, Accrued Certificate Interest allocable to the Class 2-A5 Certificates
pursuant to priorities (ii) and (iii) above will be distributable as interest
thereon and will not be added to the Class Certificate Principal Amount
thereof.
(e) On each Distribution Date, the Trustee shall distribute the
amount withdrawn from the Class 2-A3 Reserve Fund with respect to such
Distribution Date pursuant to Section 4.06, to the extent of funds on deposit
in the Class 2-A3 Reserve Fund, and shall apply such funds to distributions on
the Class 2-A3 Certificates, as interest thereon, in the amount of any Net
Prepayment Interest Shortfalls for Pool 2 with respect to such Distribution
Date.
(f) On each Distribution Date, the Trustee shall distribute to the
Holder of the Class R Certificate any amounts remaining in the Upper Tier
REMIC for such Distribution Date after application of all amounts described in
paragraph (a) of this Section 5.02. Any distribution pursuant to this
paragraph (f) should not reduce the Class Certificate Principal Amount of the
Class R Certificate.
Section 5.03. Allocation of Realized Losses. (a) On any Distribution
Date, the principal portion of each Realized Loss (other than any Excess Loss)
in respect of a Mortgage Loan in either Mortgage Pool shall be allocated as
follows:
(i) The applicable AP Percentage of the principal
portion of any such Realized Loss in Pool 1 shall be allocated to the
AP(1) Component and the principal portion of any Realized Loss in
Pool 2 shall be allocated to the AP(2) Component until their
respective Component Principal Amounts have been reduced to zero; and
(ii) The applicable Non-AP Percentage of the principal
portion of any such Realized Loss from either Mortgage Pool shall be
allocated in the following order of priority:
first, to the Class Certificate Principal Amounts
of the Class B-6 Certificates of the related Certificates
Group, until the Class Certificate Principal Amount of each
such Class has been reduced to zero;
second, to the Class Certificate Principal Amounts
of the Class B5 Certificates of the related Certificate
Group, as applicable, until the Class Certificate Principal
Amount of each such Class has been reduced to zero;
third, to the Class Certificate Principal Amounts
of the Class B4 Certificates of the related Certificate
Group, until the Class Certificate Principal Amount of each
such Class has been reduced to zero;
fourth, to the Class Certificate Principal Amounts
of the Class B3 Certificates of the related Certificate
Group, until the Class Certificate Principal Amount of each
such Class has been reduced to zero;
fifth, to the Class Certificate Principal Amounts
of the Class B2 Certificates of the related Certificate
Group, until the Class Certificate Principal Amount of each
such Class has been reduced to zero;
sixth, to the Class Certificate Principal Amounts
of the Class B1 Certificates of the related Certificate
Group, until the Class Certificate Principal Amount of each
such Class has been reduced to zero; and
seventh, to the Classes of Senior Certificates of
the related Certificate Group pro rata, in accordance with
their Class Certificate Principal Amounts (or Component
Principal Amounts); provided, however, that any such loss
allocated to any Class of Accrual Certificates (and any
Accrual Component) shall be allocated (subject to Section
5.03(c)) on the basis of the lesser of (x) the Class
Certificate Principal Amount (or Component Principal Amount)
thereof immediately prior to the applicable Distribution
Date and (y) the Class Certificate Principal Amount (or
Component Principal Amount) thereof on the Closing Date (as
reduced by any Realized Losses previously allocated
thereto).
(b) With respect to any Distribution Date, the principal portion of
any Excess Loss in respect of a Mortgage Loan in either Mortgage Pool shall be
allocated as follows: (1) the AP Percentage of any such loss shall be
allocated to the AP(1) Component and AP(2) Component, as applicable, and (2)
the Non-AP Percentage of any such loss shall be allocated among the Classes of
the related Certificate Group, other than the Class AP Certificates, pro rata,
based on the respective Class Certificate Principal Amounts thereof; provided,
however, that any such loss allocated to any Class of Accrual Certificates
shall be allocated (subject to Section 5.03(c)) on the basis of the lesser of
(x) the Class Principal Amount thereof immediately prior to the applicable
Distribution Date and (y) the Class Principal Amount thereof on the Closing
Date (as reduced by any Realized Losses previously allocated thereto).
(c) Any Realized Losses allocated to a Class of Certificates pursuant
to Section 5.03(a) or (b) shall be allocated among the Certificates of such
Class in proportion to their respective Certificate Principal Amounts. Any
allocation of Realized Losses pursuant to this paragraph (c) shall be
accomplished by reducing the Certificate Principal Amount of the related
Certificates on the related Distribution Date in accordance with Section
5.03(d).
(d) Realized Losses allocated in accordance with this Section 5.03
shall be allocated on the Distribution Date in the month following the month
in which such loss was incurred and, in the case of the principal portion
thereof, after giving effect to distributions made on such Distribution Date,
except that the aggregate amount of Realized Losses to be allocated to the
AP(1) Component and the AP(2) Component on such Distribution Date will be
taken into account in determining distributions in respect of any AP(1)
Deferred Amount or AP(2) Deferred Amount, as applicable for such date.
(e) On each Distribution Date, the Subordinate Certificate Writedown
Amount for such date shall effect a corresponding reduction in the Certificate
Principal Amount of the lowest ranking Class of outstanding Subordinate
Certificates, which reduction shall occur on such Distribution Date after
giving effect to distributions made on such Distribution Date.
(f) In the event that there is a recovery of an amount in respect of
principal of a Mortgage Loan, which amount had previously been allocated as a
Realized Loss to one or more Classes of Certificates and, if applicable, to
one or more Components, each outstanding Class or Component to which any
portion of such Realized Loss had previously been allocated shall be entitled
to receive, on the Distribution Date in the month following the month in which
such recovery is received, its pro rata share (based on the Class Certificate
Principal Amount or Component Principal Amount thereof) of such recovery, up
to the amount of the portion of such Realized Loss previously allocated to
such Class. A Class of Certificates that is no longer outstanding shall not be
entitled to any share of such recovery. In the event that the total amount of
such recovery exceeds the amount of such recovery allocated to the outstanding
Classes in accordance with the preceding provisions, each outstanding Class of
Certificates or Component shall be entitled to receive its pro rata share of
the amount of such excess, up to the amount of any unrecovered Realized Loss
previously allocated to such Class. Any such recovery allocated to a Class of
Certificates shall not further reduce the Certificate Principal Amount of such
Certificate. Any such amounts not otherwise allocated to any Class of
Certificates pursuant to this subsection shall be treated as Principal
Prepayments for purposes of this Agreement.
Section 5.04. Trustee Advances. In the event that the Servicer fails
for any reason to make an Advance required to be made by it pursuant to the
Seller's Warranties and Servicing Agreement on or before the Remittance Date,
the Trustee shall, on or before the related Distribution Date, deposit in the
Certificate Account an amount equal to the excess of (a) Advances required to
be made by the Servicer that would have been deposited in such Certificate
Account over (b) the amount of any Advance made by the Servicer with respect
to such Distribution Date; provided, however, that the Trustee shall be
required to make such Advance only if it is not prohibited by law from doing
so and it has determined that such Advance would be recoverable from amounts
to be received with respect to such Mortgage Loan, including Liquidation
Proceeds, Insurance Proceeds, or otherwise. The Trustee shall be entitled to
be reimbursed from the Certificate Account for Advances made by it pursuant to
this Section 5.04 as if it were the Servicer. In no event will the Trustee be
required to make an Advance of the Retained Yield.
Section 5.05. Distributions of Principal on Redemption Certificates.
(a) Except as provided in subclauses (d) and (f) below, on each Distribution
Date on which distributions in reduction of the Class Certificate Principal
Amount of a Class of Redemption Certificates are made, such distributions will
be made in the following order of priority:
(i) any request by the personal representative of a
Deceased Holder or by a surviving tenant by the entirety, by a
surviving joint tenant or by a surviving tenant in common or other
Person empowered to act on behalf of such Deceased Holder upon his or
her death, in an amount up to but not exceeding $100,000 per request;
and
(ii) any request by a Living Holder, in an amount up to
but not exceeding $10,000 per request.
Thereafter, distributions will be made as provided in clauses (i) and
(ii) above up to a second $100,000 and $10,000 per request, respectively. This
sequence of priorities will be repeated for each request for principal
distributions made by the Certificate Owners of a Class of Redemption
Certificates until all such requests have been honored.
Requests for distributions in reduction of the Certificate Principal
Amounts of Redemption Certificates presented on behalf of Deceased Holders in
accordance with the provisions of clause (i) above will be accepted in the
order of their receipt by the Clearing Agency. Requests for distributions in
reduction of the Certificate Principal Amounts of Redemption Certificates
presented in accordance with the provisions of clause (ii) above will be
accepted in the order of priority established by the random lot procedures of
the Clearing Agency after all requests with respect to such Class presented in
accordance with clause (i) have been honored. All requests for distributions
in reduction of the Class Certificate Principal Amount of a Class of
Redemption Certificates with respect to any Distribution Date shall be made in
accordance with Section 5.05(c) below and must be received by the Clearing
Agency and forwarded to, and received by, the Trustee no later than the close
of business on the related Record Date. Requests for distributions that are
received by the Clearing Agency and forwarded to the Trustee after the related
Record Date and requests, in either case, for distributions timely received
but not accepted with respect to any Distribution Date, will be treated as
requests for distributions in reduction of the Class Certificate Principal
Amount of the applicable Class of Redemption Certificates on the next
succeeding Distribution Date, and each succeeding Distribution Date
thereafter, until each such request is accepted or is withdrawn as provided in
Section 5.05(c). Such requests as are not so withdrawn shall retain their
order of priority without the need for any further action on the part of the
appropriate Certificate Owner of the related Redemption Certificate, all in
accordance with the procedures of the Clearing Agency and the Trustee. Upon
the transfer of beneficial ownership of any Redemption Certificate, any
distribution request previously submitted with respect to such Certificate
will be deemed to have been withdrawn only upon the receipt by the Trustee of
notification of such withdrawal using a form required by the Clearing Agency.
Distributions in reduction of the Certificate Principal Amounts of
Redemption Certificates will be applied, in the aggregate, to such
Certificates in an amount equal to the portion of the Available Distribution
Amount distributable to the Redemption Certificates pursuant to Section
5.02(a)(iv), plus any amounts available for distribution from the applicable
Rounding Account pursuant to Section 5.05(e), provided that the aggregate
distribution in reduction of the Class Certificate Principal Amount of any
Class of Redemption Certificates on any Distribution Date is made in an
integral multiple of $1,000.
(b) A "Deceased Holder" is a Certificate Owner of a Redemption
Certificate who was living at the time such interest was acquired and whose
authorized personal representative, surviving tenant by the entirety,
surviving joint tenant or surviving tenant in common or other Person empowered
to act on behalf of such Certificate Owner upon his or her death, causes to be
furnished to the Trustee a certified copy of the death certificate of such
Certificate Owner and any additional evidence of death required by and
satisfactory to the Trustee and any tax waivers requested by the Trustee.
Redemption Certificates beneficially owned by tenants by the entirety, joint
tenants or tenants in common will be considered to be beneficially owned by a
single owner. The death of a tenant by the entirety, joint tenant or tenant in
common will be deemed to be the death of the Certificate Owner, and any
Redemption Certificates so beneficially owned will be eligible for priority
with respect to distributions in reduction of the Class Certificate Principal
Amount of such Class of Redemption Certificates, subject to the limitations
stated above. Redemption Certificates beneficially owned by a trust will be
considered to be beneficially owned by each beneficiary of the trust to the
extent of such beneficiary's beneficial interest therein, but in no event will
a trust's beneficiaries collectively be deemed to be Certificate Owners of a
number of Individual Redemption Certificates greater than the number of
Individual Redemption Certificates of which such trust is the beneficial
owner. The death of a beneficiary of a trust will be deemed to be the death of
a Certificate Owner of the Redemption Certificates beneficially owned by the
trust to the extent of such beneficiary's beneficial interest in such trust.
The death of an individual who was a tenant by the entirety, joint tenant or
tenant in common in a tenancy that is the beneficiary of a trust will be
deemed to be the death of the beneficiary of the trust. The death of a person
who, during his or her lifetime, was entitled to substantially all of the
beneficial ownership interests in Redemption Certificates will be deemed to be
the death of the Certificate Owner of such Redemption Certificates regardless
of the registration of ownership of such Redemption Certificates, if such
beneficial interest can be established to the satisfaction of the Trustee.
Such beneficial interest will be deemed to exist in typical cases of street
name or nominee ownership, ownership by a trustee, ownership under the Uniform
Gifts to Minors Act and community property or other joint ownership
arrangements between a husband and wife. Beneficial interests shall include
the power to sell, transfer or otherwise dispose of a Redemption Certificate
and the right to receive the proceeds therefrom, as well as interest and
distributions in reduction of the Certificate Principal Amounts of the
Redemption Certificates payable with respect thereto. The Trustee shall not be
under any duty to determine independently the occurrence of the death of any
deceased Certificate Owner. The Trustee may rely entirely upon documentation
delivered to it pursuant to Section 5.05(a) in establishing the eligibility of
any Certificate Owner to receive the priority accorded Deceased Holders in
Section 5.05(a).
(c) Requests for distributions in reduction of the Certificate
Principal Amount of a Redemption Certificate must be made by delivering a
written request therefor to the Clearing Agency Participant or Financial
Intermediary that maintains the account evidencing the Certificate Owner's
interest in such Redemption Certificate. Such Clearing Agency Participant or
Financial Intermediary should in turn make the request of the Clearing Agency
(or, in the case of an Financial Intermediary, such Financial Intermediary
should notify the related Clearing Agency Participant of such request, which
Clearing Agency Participant should make the request of the Clearing Agency) on
a form required by the Clearing Agency and provided to the Clearing Agency
Participant. Upon receipt of such request, the Clearing Agency will date and
time stamp such request and forward such request to the Trustee. The Clearing
Agency may establish such procedures as it deems fair and equitable to
establish the order of receipt of requests for such distributions received by
it on the same day. The Trustee shall not be liable for any delay in delivery
of requests for distributions or withdrawals of such requests by the Clearing
Agency, a Clearing Agency Participant or any Financial Intermediary.
In the event that any requests for distributions in
reduction of the Certificate Principal Amount of Redemption Certificates are
rejected by the Trustee for failure to comply with the requirements of this
Section 5.05, the Trustee shall return such requests to the appropriate
Clearing Agency Participant with a copy to the Clearing Agency with an
explanation as to the reason for such rejection.
The Trustee shall maintain a list of those Clearing Agency
Participants representing the Certificate Owners of Redemption Certificates
that have submitted requests for distributions in reduction of the Certificate
Principal Amount of such Redemption Certificates, together with the order of
receipt and the amounts of such requests. The Trustee shall notify the
Clearing Agency and the appropriate Clearing Agency Participants as to which
requests should be honored on each Distribution Date. Requests shall be
honored by the Clearing Agency in accordance with the procedures, and subject
to the priorities and limitations, described in this Section 5.05. The exact
procedures to be followed by the Trustee and the Clearing Agency for purposes
of determining such priorities and limitations shall be those established from
time to time by the Trustee or the Clearing Agency, as the case may be. The
decisions of the Trustee and the Clearing Agency concerning such matters shall
be final and binding on all affected Persons.
Payments in reduction of the Certificate Principal Amounts
of Redemption Certificates shall be made on the applicable Distribution Date
and the Certificate Balances as to which such payments are made shall cease to
bear interest after the last day of the month preceding the month in which
such Distribution Date occurs.
Any Certificate Owner of a Redemption Certificate that has
requested a distribution may withdraw its request by so notifying in writing
the Clearing Agency Participant or Financial Intermediary that maintains such
Certificate Owner's account. In the event that such account is maintained by a
Financial Intermediary, such Financial Intermediary should notify the related
Clearing Agency Participant which in turn should forward the withdrawal of
such request, on a form required by the Clearing Agency, to the Trustee. If
such notice of withdrawal of a request for distribution has not been received
by the Clearing Agency and forwarded to the Trustee on or before the Record
Date for the next Distribution Date, the previously made request for
distribution will be irrevocable with respect to the making of distributions
in reduction of the Certificate Principal Amount of such Redemption
Certificate on such Distribution Date.
(d) To the extent, if any, that amounts available for distribution in
reduction of the Class Certificate Principal Amount of any Class of Redemption
Certificates on a Distribution Date exceed the dollar amount of requests for
distributions with respect to such Class that have been received by the
related Record Date, as provided in Section 5.05(c) above, distributions in
reduction of the Class Certificate Principal Amount of such Class of
Redemption Certificates will be made by mandatory distributions in reduction
thereof. The Trustee shall notify the Clearing Agency of the aggregate amount
of the mandatory distribution in reduction of the Class Certificate Principal
Amount of such Class of Redemption Certificates to be made on the next
Distribution Date. The Clearing Agency shall then allocate such aggregate
amount among its Clearing Agency Participants on a random lot basis. Each
Clearing Agency Participant and, in turn, each Financial Intermediary, will
then select, in accordance with its own procedures, Individual Redemption
Certificates from among those held in its accounts to receive mandatory
distributions in reduction of the Class Certificate Principal Amount of such
Class of Redemption Certificates, such that the total amount so selected is
equal to the aggregate amount of such mandatory distributions allocated to
such Clearing Agency Participant by the Clearing Agency and to such Financial
Intermediary by its related Clearing Agency Participant, as the case may be.
Clearing Agency Participants and Financial Intermediaries that hold Redemption
Certificates selected for mandatory distributions in reduction of the Class
Certificate Principal Amount thereof should provide notice of such mandatory
distributions to the affected Certificate Owners.
(e) On the Closing Date, a Rounding Account shall be established with
the Trustee for each Class of Redemption Certificates, and Xxxxxx Brothers
Inc. shall cause to be initially deposited the sum of $999.99 in each Rounding
Account. On each Distribution Date on which a distribution is made in
reduction of the Class Certificate Principal Amount of a Class of Redemption
Certificates, funds on deposit in the applicable Rounding Account shall be, to
the extent needed, withdrawn by the Trustee and applied to round upward to an
integral multiple of $1,000 the aggregate distribution in reduction of the
Class Certificate Principal Amount to be made on such Redemption Certificates.
Rounding of such distribution on such Redemption Certificates shall be
accomplished, on the first such Distribution Date, by withdrawing from the
applicable Rounding Account the amount of funds, if any, needed to round the
amount otherwise available for such distribution in reduction of the Class
Certificate Principal Amount of such Class of Redemption Certificates upward
to the next integral multiple of $1,000. On each succeeding Distribution Date
on which distributions in reduction of the Class Certificate Principal Amount
of such Class of Redemption Certificates are to be made, the aggregate amount
of such distributions allocable to such Class of Redemption Certificates shall
be applied first to repay any funds withdrawn from the applicable Rounding
Account and not previously repaid, and then the remainder of such allocable
amount, if any, shall be similarly rounded upward and applied as distributions
in reduction of the Class Certificate Principal Amount of such Class of
Redemption Certificates; this process shall continue on succeeding
Distribution Dates until the Class Certificate Principal Amount of such Class
of Redemption Certificates has been reduced to zero. Each Rounding Account
shall be an "outside reserve fund" under the REMIC Provisions that is
beneficially owned for all federal income tax purposes by Xxxxxx Brothers Inc.
Xxxxxx Brothers Inc. will report all income, gain, deduction or loss with
respect thereto. The Trustee, upon the instructions of the Depositor, may
invest, or cause to be invested funds in the Class 2-A3 Reserve Fund in
Eligible Investments (which may be obligations of the Trustee). The Trustee
shall distribute interest earnings, if any, on amounts held in any Rounding
Account as such interest is earned pursuant to written instructions from
Xxxxxx Brothers Inc. to the Trustee.
Notwithstanding anything herein to the contrary, on the Distribution
Date on which distributions in reduction of the Class Certificate Principal
Amount of any Class of Redemption Certificates will reduce the Class
Certificate Principal Amount thereof to zero or in the event that
distributions in reduction of the Class Certificate Principal Amount of such
Class of Redemption Certificates are made in accordance with the provisions
set forth in Section 5.05(f), an amount equal to the difference between
$999.99 and the sum then held in the applicable Rounding Account shall be paid
from the Available Distribution Amount for such Distribution Date to such
Rounding Account. Any funds then on deposit in such Rounding Account shall be
distributed to Xxxxxx Brothers Inc.
(f) Notwithstanding any provisions herein to the contrary, on each
Distribution Date following the first Distribution Date on or after the Credit
Support Depletion Date, all distributions in reduction of the Class
Certificate Principal Amount of any Class of Redemption Certificates will be
made among the Holders of such Class of Certificates, pro rata, based on their
Certificate Principal Amounts, and will not be made in integral multiples of
$1,000 or pursuant to requested distributions or mandatory distributions by
random lot.
(g) In the event that Definitive Certificates representing any Class
of Redemption Certificates are issued pursuant to Section 3.09(c), all
requests for distributions or withdrawals of such requests relating to such
Class must be submitted to the Trustee, and the Trustee shall perform the
functions described in Section 5.05(a) through (c) using its own procedures,
which procedures shall, to the extent practicable, be consistent with the
procedures described in Section 5.05(a) through (c).
Section 5.06. The Class 2-A3 Certificate Insurance Policy. (a) If, on
the second Business Day before any Distribution Date, the Trustee determines
that an Insured Payment is required to be made by the Certificate Insurer on
such Distribution Date, the Trustee shall determine the amount of any such
Insured Payment and shall give notice to the Class 2-A3 Certificate Insurer by
completing a Notice of Nonpayment in the form of Exhibit A to the Certificate
Insurance Policy and submitting such Notice of Nonpayment by 12:00 noon, New
York City time on such second Business Day as a claim for an Insured Payment.
The Trustee's responsibility for delivering a Notice of Nonpayment to the
Class 2-A3 Certificate Insurer, as provided in the preceding sentence, is
limited to the availability, timeliness and accuracy of the information
provided by the Servicer.
(b) In the event the Trustee receives a certified copy of an order of
the appropriate court that any scheduled payment of principal or interest on a
Class 2-A3 Certificate has been voided in whole or in part as a preference
payment under applicable bankruptcy law, the Trustee shall (i) promptly notify
the Class 2-A3 Certificate Insurer, as appropriate, and the Fiscal Agent, if
any, and (ii) comply with the provisions of the Class 2-A3 Certificate
Insurance Policy to obtain payment by the Class 2-A3 Certificate Insurer of
such voided scheduled payment. In addition, the Trustee shall mail notice to
all Holders of the Class 2-A3 Certificates so affected that, in the event that
any such Holder's scheduled payment is so recovered, such Holder will be
entitled to payment pursuant to the terms of the Class 2-A3 Certificate
Insurance Policy, a copy of which shall be made available to such Holders by
the Trustee. The Trustee shall furnish to the Class 2-A3 Certificate Insurer
and the appropriate Fiscal Agent, if any, its records listing the payments on
the affected Class 2-A3 Certificates, if any, that have been made by the
Trustee and subsequently recovered from the affected Holders, and the dates on
which such payments were made by the Trustee.
(c) At the time of the execution hereof, and for the purposes hereof,
the Trustee shall establish a separate special purpose trust account in the
name of the Trustee for the benefit of Holders of the Class 2-A3 Certificates
(the "Class 2-A3 Policy Payments Account") over which the Trustee shall have
exclusive control and sole right of withdrawal. The Class 2-A3 Policy Payments
Account shall be an Eligible Account. The Trustee shall deposit any amount
paid under the Class 2-A3 Certificate Insurance Policy into the Class 2-A3
Policy Payments Account and distribute such amount only for the purposes of
making payments to Holders of the Class 2-A3 Certificates in respect of the
Guaranteed Distributions (or other amounts payable pursuant to paragraph (b)
above on the Class 2-A3 Certificates by the Class 2-A3 Certificate Insurer
pursuant to the Class 2-A3 Certificate Insurance Policy) for which the related
claim was made under the Policy. Such amounts shall be allocated by the
Trustee to Holders of Class 2-A3 Certificates affected by such shortfalls in
the same manner as principal and interest distributions are to be allocated
with respect to such Certificates pursuant to Section 5.02. It shall not be
necessary for such payments to be made by checks or wire transfers separate
from the checks or wire transfers used to make regular payments hereunder with
funds withdrawn from the Certificate Account. However, any payments made on
the Class 2-A3 Certificates from funds in the Class 2-A3 Policy Payments
Account shall be noted as provided in subsection (e) below. Funds held in the
Class 2-A3 Policy Payments Account shall not be invested by the Trustee.
(d) Any funds received from the Class 2-A3 Certificate Insurer for
deposit into the Class 2-A3 Policy Payments Account pursuant to the Class 2-A3
Certificate Insurance Policy in respect of a Distribution Date or otherwise as
a result of any claim under such Class 2-A3 Certificate Insurance Policy shall
be applied by the Trustee directly to the payment in full (i) of the Insured
Payments due on such Distribution Date on the Class 2-A3 Certificates, or (ii)
of other amounts to which payments under the Class 2-A3 Certificate Insurance
Policy are to be applied. Funds received by the Trustee as a result of any
claim under the Class 2-A3 Certificate Insurance Policy shall be used solely
for payment to the Holders of the Class 2-A3 Certificates, respectively, and
may not be applied for any other purpose, including, without limitation,
satisfaction of any costs, expenses or liabilities of the Trustee or the Trust
Fund. Any funds remaining in the Class 2-A3 Policy Payments Account on the
first Business Day after each Distribution Date shall be remitted promptly to
the Class 2-A3 Certificate Insurer pursuant to the written instruction of the
Class 2-A3 Certificate Insurer.
(e) The Trustee shall keep complete and accurate records in respect
of (i) all funds remitted to it by the Class 2-A3 Certificate Insurer and
deposited into the Class 2-A3 Policy Payments Account and (ii) the allocation
of such funds to (A) payments of interest on and principal in respect of any
Class 2-A3 Certificates, (B) Realized Losses allocated to the Class 2-A3
Certificates, (C) Net Prepayment Interest Shortfalls allocated to the Class
2-A3 Certificates, and (D) payments in respect of Preference Amounts. The
Class 2-A3 Certificate Insurer shall have the right to inspect such records at
reasonable times during normal business hours upon three Business Days' prior
notice to the Trustee. Any Insured Payments disbursed by the Trustee from
proceeds of the Class 2-A3 Certificate Insurance Policy shall be considered
payment by the Class 2-A3 Certificate Insurer and not by the Trust Fund with
respect to the Class 2-A3 Certificates and the Class 2-A3 Certificates Insurer
will be entitled to receive the related Reimbursement Amount pursuant to
Section 5.02(a)(vi.
(f) The Trustee acknowledges, and each Holder of a Class 2-A3
Certificate by its acceptance of such Class 2-A3 Certificate agrees, that,
without the need for any further action on the part of the Class 2-A3
Certificate Insurer or the Trustee, to the extent the Class 2-A3 Certificate
Insurer makes Insured Payments, directly or indirectly, on account of
principal of or interest on any Class 2-A3 Certificates, the Class 2-A3
Certificate Insurer will be fully subrogated to the rights of the Holders of
such Class 2-A3 Certificates to receive the related Reimbursement Amount
pursuant to Section 5.02(a)(vi). The Class 2-A3 Certificateholders, by
acceptance of the Class 2-A3 Certificates, assign their rights as Holders of
the Class 2-A3 Certificates to the extent of the Class 2-A3 Certificate
Insurer's interest with respect to amounts paid under the Class 2-A3
Certificate Insurance Policy. Each of the Depositor and Trustee agrees to such
subrogation and, further agrees to execute such instruments and to take such
actions as, in the sole judgment of the Class 2-A3 Certificate Insurer are
necessary to evidence such subrogation and, subject to the priority of payment
provisions of this Agreement, to perfect the rights of the Class 2-A3
Certificate Insurer to receive any moneys paid or payable in respect of the
Class 2-A3 Certificates under this Agreement or otherwise. Anything herein to
the contrary notwithstanding, solely for purposes of determining the Class
2-A3 Certificate Insurer's rights as subrogee for payments distributable
pursuant to Section 5.02, any payment with respect to distributions to the
Class 2-A3 Certificates that is made with funds received pursuant to the terms
of the Class 2-A3 Certificate Insurance Policy shall not be considered payment
of the Class 2-A3 Certificates from the Trust Fund and shall not result in the
distribution or the provision for the distribution in reduction of the Class
Certificate Principal Amount of the Class 2-A3 Certificates or Accrued
Certificate Interest thereon, within the meaning of Article V.
(g) Upon its becoming aware of the occurrence of an Event of Default,
the Trustee shall promptly notify the Class 2-A3 Certificate Insurer of such
Event of Default.
(h) The Trustee shall promptly notify the Class 2-A3 Certificate
Insurer of either of the following as to which it has actual knowledge: (A)
the commencement of any proceeding by or against the Depositor commenced under
the United States bankruptcy code or any other applicable bankruptcy,
insolvency, receivership, rehabilitation or similar law (an "Insolvency
Proceeding") and (B) the making of any claim in connection with any Insolvency
Proceeding seeking the avoidance as a preferential transfer (a "Preference
Claim") of any distribution made with respect to the Class 2-A3 Certificates.
Each Holder of a Class 2-A3 Certificate, by its purchase of Class 2-A3
Certificates, and the Trustee hereby agree that the Class 2-A3 Certificate
Insurer (so long as no the Class 2-A3 Certificate Insurer Default exists) may
at any time during the continuation of any proceeding relating to a Preference
Claim direct all matters relating to such Preference Claim, including, without
limitation, (i) the direction of any appeal of any order relating to any
Preference Claim and (ii) the posting of any surety, supersedeas or
performance bond pending any such appeal. In addition and without limitation
of the foregoing, the Class 2-A3 Certificate Insurer shall be subrogated to
the rights of the Trustee and each Holder of a Class 2-A3 Certificate in the
conduct of any Preference Claim, including, without limitation, all rights of
any party to an adversary proceeding action with respect to any court order
issued in connection with any such Preference Claim.
(i) The Trustee shall surrender the Class 2-A3 Certificate Insurance
Policy to the Class 2-A3 Certificate Insurer for cancellation upon the
termination of the Trust Fund pursuant to Section 7.01 hereof.
ARTICLE VI
CONCERNING THE TRUSTEE; EVENTS OF DEFAULT
Section 6.01. Duties of Trustee. (a) The Trustee, except during the
continuance of an Event of Default, undertakes to perform such duties and only
such duties as are specifically set forth in this Agreement. Any permissive
right of the Trustee provided for in this Agreement shall not be construed as
a duty of the Trustee. If an Event of Default has occurred and has not
otherwise been cured or waived, the Trustee shall exercise such of the rights
and powers vested in it by this Agreement and use the same degree of care and
skill in their exercise as a prudent Person would exercise or use under the
circumstances in the conduct of such Person's own affairs unless the Trustee
is acting as Servicer, in which case it shall use the same degree of care and
skill as the Servicer under the Seller's Warranties and Servicing Agreement.
The Trustee may appoint a custodian to maintain custody of the
Mortgage Loans and to perform certain administrative functions on behalf of
the Trustee, to the extent provided herein. The reasonable compensation of any
such custodian shall be paid by the Trustee, and shall be reimbursable to the
Trustee from the Certificate Account.
(b) The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments
furnished to the Trustee which are specifically required to be furnished
pursuant to any provision of this Agreement, shall examine them to determine
whether they are in the form required by this Agreement; provided, however,
that the Trustee shall not be responsible for the accuracy or content of any
such resolution, certificate, statement, opinion, report, document, order or
other instrument furnished by the Servicer, to the Trustee pursuant to this
Agreement.
(c) The Trustee shall not have any liability arising out of or in
connection with this Agreement, except for its negligence or willful
misconduct. No provision of this Agreement shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own willful misconduct; provided, however, that:
(i) The Trustee shall not be personally liable with
respect to any action taken, suffered or omitted to be taken by it in
good faith in accordance with the direction of Holders of
Certificates as provided in Section 6.19 hereof;
(ii) For all purposes under this Agreement, the Trustee
shall not be deemed to have notice of any Event of Default (other
than resulting from a failure by the Servicer (i) to remit funds (or
to make Servicing Advances) or (ii) to furnish information to the
Trustee when required to do so by the Seller's Warranties and
Servicing Agreement) 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, and such notice references the Holders of the
Certificates and this Agreement;
(iii) No provision of this Agreement shall require the
Trustee 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 adequate indemnity against such risk or liability is not
reasonably assured to it; and
(iv) The Trustee shall not be responsible for any act or
omission of the Servicer.
(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 use its best efforts to remit to the 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.
(e) 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 Certificateholders of any Class holding
Certificates which evidence, as to such Class, Percentage Interests
aggregating not less than 25% as to the time, method and place of conducting
any proceeding for any remedy available to the Trustee, or exercising any
trust or power conferred upon the Trustee, under this Agreement.
(f) As assignee of the rights and delegee of the obligations of the
Depositor under the Mortgage Loan Sale and Assignment Agreement and the
Seller's Warranties and Servicing Agreement, the Trustee shall have the rights
and obligations of the "Purchaser" under the Seller's Warranties and Servicing
Agreement. Notwithstanding anything in the Seller's Warranties and Servicing
Agreement, the Trustee shall:
(i) under Section 4.02 of the Seller's Warranties and
Servicing Agreement, in any case in a Mortgaged Property has been
determined to be contaminated by hazardous or toxic substances,
direct the Servicer not to proceed with foreclosure or acceptance of
a deed in lieu of foreclosure;
(ii) not consent under Section 9.04 of the Seller's
Warranties and Servicing Agreement to any transfer or delegation by
the Servicer of its rights or duties under the Seller's Warranties
and Servicing Agreement to other than a subservicer unless the
Servicer complies with the provisions of items (i) through (iv) of
the last paragraph of such Section;
(iii) not terminate the rights of the Servicer under the
Seller's Warranties and Servicing Agreement without cause under
Section 11.02 of the Seller's Warranties and Servicing Agreement; and
(iv) not agree to any amendment of the Seller's
Warranties and Servicing Agreement except pursuant to the same
limitations and requirements as are applicable to amendments of this
Agreement pursuant to Section 11.03 hereof.
Section 6.02. Certain Matters Affecting the Trustee. Except as
otherwise provided in Section 6.01:
(i) The Trustee 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) The Trustee 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) The Trustee shall not 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, the Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
consent, order, approval, bond or other paper or document (provided
the same appears regular on its face), unless requested in writing to
do so by Holders of at least a majority in Class Certificate
Principal Amount (or Aggregate Notional Amount) of each Class of
Certificates; provided, however, that, if the payment within a
reasonable time to the Trustee of the costs, expenses or liabilities
likely to be incurred by it in the making of such investigation is,
in the opinion of the Trustee, not reasonably assured to the Trustee
by the security afforded to it by the terms of this Agreement, the
Trustee may require reasonable indemnity against such expense or
liability or payment of such estimated expenses as a condition to
proceeding. The reasonable expense thereof shall be paid by the
Holders requesting such investigation; and
(v) The Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents or attorneys, which agents or attorneys shall have any
or all of the rights, powers, duties and obligations of the Trustee
conferred on them by such appointment provided that the Trustee shall
continue to be responsible for its duties and obligations hereunder.
Section 6.03. Trustee Not Liable for Certificates. The Trustee makes
no representations as to the validity or sufficiency of this Agreement or of
the Certificates (other than the certificate of authentication on the
Certificates) or of any Mortgage Loan, or related document save that the
Trustee represents 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 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 Certificate Account or any other fund or account maintained
with respect to the Certificates.
Section 6.04. Trustee May Own Certificates. The Trustee and any
Affiliate or agent of the Trustee in its individual or any other capacity may
become the owner or pledgee of Certificates and may transact banking and trust
with the other parties hereto with the same rights it would have if it were
not Trustee or such agent.
Section 6.05. Eligibility Requirements for Trustee. The Trustee
hereunder shall at all times be (i) an institution insured by the FDIC and
(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. 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. (a) The Trustee may
at any time resign and be discharged from the trust hereby created by giving
written notice thereof to the Depositor. 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, and one copy to the successor trustee. 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 or of its property shall be appointed, or any public
officer shall take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or liquidation, (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, or (iv)
the continued use of the Trustee would result in a downgrading of the rating
by the Rating Agencies of any Class of Certificates with a rating (in the case
of the Class 2-A3 Certificates, determined without regard to the Class 2-A3
Certificate Insurance Policy), then the Depositor may remove the Trustee and
appoint a successor trustee by written instrument, one copy of which
instrument shall be delivered to the Trustee so removed and one copy to the
successor trustee.
(c) The Holders of more than 50% of the Class Certificate Principal
Amount (or Aggregate Notional Amount) 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 and one copy to the Trustee so removed; the
Depositor shall thereupon use its best efforts to appoint a mutually
acceptable 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.
Section 6.07. Successor Trustee. (a) Any successor trustee appointed
as provided in Section 6.06 shall execute, acknowledge and deliver to the
Depositor and to its predecessor trustee an instrument accepting such
appointment hereunder, and thereupon the resignation or removal of the
predecessor trustee shall become effective and such successor trustee, 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 herein. The predecessor trustee shall
deliver to the successor trustee all Mortgage Files and documents and
statements related to each Mortgage Files 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 record 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 predecessor trustee shall execute and deliver such
other instruments and do such other things as may reasonably be required to
more fully and certainly vest and confirm in the successor trustee 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 as provided
in this Section, the Depositor shall mail notice of the succession of such
trustee hereunder to all Holders of Certificates at their addresses as shown
in the Certificate Register and to the Rating Agencies. The expenses of such
mailing shall be borne by the Depositor.
Section 6.08. Merger or Consolidation of Trustee. Any Person into
which the Trustee may be merged or with which it may be consolidated, or any
Person resulting from any merger, conversion or consolidation to which the
Trustee shall be a party, or any Persons succeeding to the business of the
Trustee, shall be the successor of the Trustee 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
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 Certificate Principal Amount (or Aggregate Notional Amount) of each
Class of Certificates shall each have the power from time to time to appoint
one or more Persons 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 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 Trustee to make Advances pursuant to Section 5.04 and 6.14 hereof shall
not be affected or assigned by the appointment of a co-trustee.
(b) Every separate trustee, co-trustee, and custodian shall, to the
extent permitted by law, be appointed and act subject to the following
provisions and conditions:
(i) all powers, duties, obligations and rights conferred
upon the Trustee in respect of the receipt, custody and payment of
moneys shall be exercised solely by the Trustee;
(ii) all other rights, powers, duties and obligations
conferred or imposed upon the Trustee shall be conferred or imposed
upon and exercised or performed by the Trustee and such separate
trustee, co-trustee, or custodian jointly, except to the extent that
under any law of any jurisdiction in which any particular act or acts
are to be performed the Trustee shall be incompetent or unqualified
to perform such act or acts, in which event such rights, powers,
duties and obligations, including the holding of title to the Trust
Fund or any portion thereof in any such jurisdiction, shall be
exercised and performed by such separate trustee, co-trustee, or
custodian;
(iii) no trustee or custodian hereunder shall be
personally liable by reason of any act or omission of any other
trustee or custodian hereunder; and
(iv) the Trustee or the Certificateholders evidencing
more than 50% of the Aggregate Voting Interests of the Certificates
may at any time 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.
(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 Certificateholders of the appointment shall be
required under Section 6.07 hereof.
(f) The Trustee agrees to instruct the co-trustees, if any, to the
extent necessary to fulfill the Trustee's obligations hereunder.
(g) The Trustee shall pay the reasonable compensation of the
co-trustees to the extent, and in accordance with the standards, specified in
Section 6.12 hereof (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. 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. Any Authenticating Agent shall be entitled to
reasonable compensation for its services and, if paid by the Trustee, it shall
be a reimbursable expense pursuant to Section 6.12.
Section 6.11. Indemnification of Trustee. The Trustee and its
directors, officers, employees and agents shall be entitled to indemnification
from the Trust Fund, to the extent that indemnification is not provided by the
Servicer pursuant to the Seller's Warranties and Servicing Agreement, for any
loss, liability or expense incurred in connection with any legal proceeding
and 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, 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, provided that:
(i) to the extent that the indemnification provisions of
the Seller's Warranties and Servicing Agreement indemnify the
Trustee, as assignee of the "Purchaser" thereunder, for such loss,
liability or expense, the Trustee has first made reasonable efforts
to enforce any applicable provisions in the Seller's Warranties and
Servicing Agreement for indemnification or reimbursement of the
Trustee (as "Purchaser") by the Servicer (it being understood and
agreed that "reasonable efforts" shall, without limitation, (A) not
require that the Trustee have brought suit against the Servicer to
enforce such indemnification provisions before making a claim against
the assets of the Trust Fund and (B) have been satisfied if the
Trustee shall have made demand on the Servicer for such
indemnification, but the Servicer is unable to satisfy such demand
due to its insolvency);
(ii) with respect to any such claim, the Trustee shall
have given the Depositor and the Holders written notice thereof
promptly after the Trustee shall have knowledge thereof;
(iii) while maintaining control over its own defense,
the Trustee shall cooperate and consult fully with the Depositor in
preparing such defense; and
(iv) 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 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 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 Trustee. The Trustee shall be
entitled to receive, and is authorized to pay to itself, the amount of income
or gain earned from the investment of funds in the Certificate Account. The
Trustee shall be entitled to reimbursement of reasonable disbursements and
expenses made or incurred by the Trustee in accordance with the provisions of
this Agreement, but not for (i) any such expense, disbursement or advance as
may arise from the Trustee's negligence or willful misconduct or (ii) any
amount expressly required under this Agreement to be paid by the Trustee from
its own funds.
Section 6.13. Collection of Monies. Except as otherwise expressly
provided in this Agreement, the Trustee may demand payment or delivery of, and
shall receive and collect, all money and other property payable to or
receivable by the Trustee pursuant to this Agreement. 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. If the Trustee shall not have
timely received amounts to be remitted with respect to the Mortgage Loans from
the Servicer, the Trustee shall request the Servicer to make such distribution
as promptly as practicable or legally permitted. If the Trustee shall
subsequently receive any such amount, it may withdraw such request.
Section 6.14. Trustee To Act; Appointment of Successor. (a) If an
Event of Default shall occur, 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 the Seller's Warranties and
Servicing Agreement, the Trustee by notice in writing to the Servicer may, and
shall, if so directed by Certificateholders evidencing more than 50% of the
Class Certificate Principal Amount (or Aggregate Notional Amount) of each
Class of Certificates, terminate all of the rights and obligations of the
Servicer under the Seller's Warranties and Servicing Agreement and in and to
the Mortgage Loans and the proceeds thereof. On or after the receipt by the
Servicer of such written notice, all authority and power of the Servicer, and
only in its capacity as Servicer under the Seller's Warranties and Servicing
Agreement, whether with respect to the Mortgage Loans or otherwise, shall pass
to and be vested in the Trustee pursuant to and under the terms of the
Seller's Warranties and Servicing Agreement; and the Trustee is hereby
authorized and empowered to execute and deliver, on behalf of the defaulting
Servicer as attorney-in-fact or otherwise, any and all documents and other
instruments, and to do or accomplish all other acts or things necessary or
appropriate to effect the purposes of such notice of termination, whether to
complete the transfer and endorsement or assignment of the Mortgage Loans and
related documents or otherwise.
If any Event of Default shall occur, the Trustee shall promptly
notify the Rating Agencies and the Class 2-A3 Certificate Insurer of the
nature and extent of such Event of Default. The Trustee shall immediately give
written notice to the Servicer upon such Servicer's failure to remit funds on
the Remittance Date.
(b) On and after the time the Servicer receives a notice of
termination from the Trustee pursuant to Section 6.14(a) or the Trustee
receives the resignation of the Servicer evidenced by an Opinion of Counsel
pursuant to the applicable provision of the Seller's Warranties and Servicing
Agreement, the Trustee, unless another servicer shall have been appointed,
shall be the successor in all respects to the 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 Servicer under the Seller's Warranties and Servicing
Agreement, including the obligation to make Advances pursuant to this
Agreement, but in no event will the Trustee have the obligation to make
Advances of the Retained Yield; provided, however, that any failure to perform
such duties or responsibilities caused by the Servicer's failure to provide
information required by the Seller's Warranties and Servicing Agreement shall
not be considered a default by the Trustee hereunder. In addition, the Trustee
shall have no responsibility for any act or omission of the Servicer prior to
the issuance of any notice of termination. In the Trustee's capacity as such
successor, the Trustee shall have the same limitations on liability herein
granted to the Servicer. As compensation therefor, the Trustee shall be
entitled to receive all compensation payable to the Servicer under the
Seller's Warranties and Servicing Agreement, including the applicable portion
of the related Servicing Fee.
(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, appoint,
or petition a court of competent jurisdiction to appoint, any established
housing and home finance institution servicer, master servicer, servicer or
mortgage servicing institution having a net worth of not less than $15,000,000
and meeting such other standards for a successor servicer as are set forth in
the Seller's Warranties and Servicing Agreement, as the successor to such
Servicer in the assumption of all of the responsibilities, duties or
liabilities of a servicer, like the Servicer. Any entity designated by the
Trustee as a successor Servicer 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 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 Mortgage Loans as it and such successor
shall agree; provided, however, that no such compensation shall be in excess
of that permitted to the Servicer. 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 servicing to be conducted hereunder which are not inconsistent herewith.
The Servicer shall cooperate with the Trustee and any successor servicer in
effecting the termination of the Servicer's responsibilities and rights
hereunder including, without limitation, notifying Mortgagors of the
assignment of the servicing functions and providing the Trustee and successor
servicer, as applicable, all documents and records in electronic or other form
reasonably requested by it to enable it to assume the Servicer's functions
hereunder and the transfer to the Trustee or such successor servicer, as
applicable, all amounts which shall at the time be or should have been
deposited by the Servicer in the Certificate Account and 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 any other
successor servicer shall be deemed to be in default hereunder by reason of any
failure to make, or any delay in making, any distribution hereunder or any
portion thereof caused by (i) the failure of the Servicer to deliver, or any
delay in delivering, cash, documents or records to it, (ii) to cooperate as
required by the Seller's Warranties and Servicing Agreement, (iii) to deliver
the Mortgage Loan data to the Trustee as required by the Seller's Warranties
and Servicing Agreement or (iv) restrictions imposed by any regulatory
authority having jurisdiction over the Servicer.
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 an express trust, 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
and the Class 2-A3 Certificate Insurer (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. 35% or more of the Aggregate Voting
Interests of Certificateholders may waive any default or Event of Default by
the Servicer in the performance of its obligations under the Seller's
Warranties and Servicing Agreement except that a default in the making of any
required deposit to the Certificate Account that would result in a failure of
the Trustee 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, any Event of Default arising therefrom shall be deemed to have
been remedied for every purpose of this Agreement, and, to the extent that
such default related to the Servicer's obligation to make any Advance, the
Trustee shall not be obligated to make such Advance, notwithstanding anything
to the contrary in 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
Servicer or appointment of a successor Servicer, in each case as provided
herein, the Trustee shall promptly mail notice thereof by first class mail to
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 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 Certificate Principal Amount (or
Aggregate Notional Amount) of each Class of Certificates may direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee, or exercising any trust or power conferred upon the Trustee, under
this Agreement; provided, however, that the Trustee shall be under no
obligation to pursue any such remedy, or to exercise any of the trusts or
powers vested in it by this Agreement (including, without limitation, (i) the
conducting or defending of any administrative action or litigation hereunder
or in relation hereto and (ii) the terminating of the Servicer or any
successor servicer from its rights and duties as servicer hereunder) at the
request, order or direction of any of the Certificateholders, unless such
Certificateholders shall have offered to the Trustee reasonable security or
indemnity 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 or be unjustly prejudicial to the
non-assenting Certificateholders.
Section 6.19. Action Upon Certain Failures of the Servicer and Upon
Event of Default. In the event that the Trustee shall have actual knowledge of
any action or inaction of the Servicer, which would become an Event of Default
upon the Servicer's failure to remedy the same after notice, the Trustee shall
give notice thereof to the Servicer. For all purposes of this Agreement, in
the absence of actual knowledge by a Responsible Officer of the Trustee, the
Trustee shall not be deemed to have knowledge of any failure of the Servicer
or any other Event of Default unless notified thereof in writing by the
Servicer or by a Certificateholder.
ARTICLE VII
PURCHASE AND TERMINATION
OF THE TRUST FUND
Section 7.01. Termination of Trust Fund Upon Repurchase or
Liquidation of All Mortgage Loans. (a) The obligations and responsibilities of
the Trustee created hereby (other than the obligation of the Trustee to make
payments to Certificateholders as set forth in Section 7.02), shall terminate
on the earlier 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 and (ii) the sale of the property held by the Trust Fund in
accordance with Section 7.01(b); provided, however, that in no event shall the
Trust Fund created hereby continue beyond the earlier of (i) 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, and (ii) the Latest Possible Maturity Date. Any
termination of the Trust Fund shall be carried out in such a manner so that
the termination of each REMIC included therein shall qualify as a "qualified
liquidation" under the REMIC Provisions.
(b) On any Distribution Date occurring after the date on which the
aggregate Scheduled Principal Balance of the Mortgage Loans in either Mortgage
Pool is less than 5% of the Cut-off Date Aggregate Principal Balance of the
Mortgage Loans in such Pool, the Depositor will have the option to cause the
sale of the Mortgage Loans, any REO property and any other property remaining
in such Pool. The property of such Pool shall be sold at a price equal to: (i)
100% of the unpaid principal balance of each Mortgage Loan on the day of such
purchase plus interest accrued thereon at the applicable Mortgage Rate with
respect to any Mortgage Loan to the Due Date in the Due Period immediately
preceding the related Distribution Date to the date of such repurchase, (ii)
the fair market value of any REO Property and any other property held by such
Pool, such fair market value to be determined by an appraiser or appraisers
mutually agreed upon by the Servicer and the Trustee, (iii) any unreimbursed
Advances made by the Servicer or the Trustee, including Servicing Advances,
and (iv) in the case of the termination of Pool 2, any Reimbursement Amounts
due to the Class 2-A3 Certificate Insurer. The termination of both Mortgage
Pools pursuant to this Section 7.01(b) shall be deemed an adoption by the
Trust Fund of a plan of complete liquidation pursuant to Section 7.03.
Section 7.02. Procedure Upon 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 with respect
to the Certificate Group, shall be given promptly by the Trustee by first
class mail to the applicable Certificateholders mailed no later than the later
of five Business Days after the Trustee has received notice from the Depositor
of its intent to exercise its right to cause the termination of a Mortgage
Pool pursuant to Section 7.01(b) or the final payment or other liquidation of
the last Mortgage Loan or REO Property in the Trust Fund. Such notice shall
specify (A) the Distribution Date upon which final distribution on the
Certificates of the Certificate Group will be made upon presentation and
surrender of the Certificates at the 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 such
Certificates at the office or agency of the Trustee therein specified. The
Trustee shall give such notice to the Certificate Registrar at the time such
notice is given to Holders of the Certificates. Upon termination of both
Mortgage Pools, the duties of the Certificate Registrar with respect to the
Certificates shall terminate and the Trustee shall terminate the Certificate
Account and any other account or fund maintained with respect to the
Certificates, subject to the Trustee's obligation hereunder to hold all
amounts payable to Certificateholders in trust without interest pending such
payment.
(b) In the event that all of the Holders do not surrender their
Certificates for cancellation within three months after the time specified in
the above-mentioned written notice, the Trustee shall give a second written
notice to the remaining Certificateholders to surrender their Certificates for
cancellation and receive the final distribution with respect thereto. If
within one year after the second notice any Certificates shall not have been
surrendered for cancellation, the Trustee 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 Trustee
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 Trustee and not distributed to
a Certificateholder due to such Mortgage Certificateholder's failure to
surrender its Certificate(s) for payment of the final distribution thereon in
accordance with this Section.
Section 7.03. Additional Trust Fund Termination Requirements. (a) The
Trust Fund shall be terminated in accordance with the following additional
requirements, unless the Trustee seeks, and subsequently receives, an Opinion
of Counsel, addressed to the Trustee to the effect that the failure of the
Trust Fund to comply with the requirements of this Section 7.03 will not (i)
result in the imposition of taxes on any REMIC under the REMIC Provisions or
(ii) cause any REMIC established hereunder to fail to qualify as a REMIC at
any time that any Certificates are outstanding:
(i) Within 89 days prior to the time of the making of
the final payment on the Certificates, the Trustee (upon notification
by the Depositor that it intends to exercise its option to cause the
termination of the Trust Fund) shall adopt a plan of complete
liquidation of the Trust Fund on behalf of each REMIC, meeting the
requirements of a qualified liquidation under the REMIC Provisions;
(ii) The sale of the assets of the Trust Fund pursuant
to Section 7.02 shall be a sale for cash and shall occur at or after
the time of adoption of such a plan of complete liquidation and prior
to the time of making of the final payment on the Certificates;
(iii) On the date specified for final payment of the
Certificates, the Trustee shall make final distributions of principal
and interest on the 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
Trust Fund (and each REMIC) shall terminate at that time; and
(iv) In no event may the final payment on the
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 (i) authorizes the Trustee to take such action as may be necessary to
adopt a plan of complete liquidation of the related REMIC and (ii) agrees to
take such other action as may be necessary to adopt a plan of complete
liquidation of the related REMIC, which authorization shall be binding upon
all successor Residual Certificateholders.
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 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 Certificate Principal Amount (or Aggregate Notional Amount) of
Certificates of each Class shall have made written request upon the Trustee to
institute such action, suit or proceeding in its own name as Trustee hereunder
and shall have offered to the Trustee such reasonable indemnity as it may
require against the cost, expenses and liabilities to be incurred therein or
thereby, and the Trustee, for sixty days after its receipt of such notice,
request and offer of indemnity, shall have neglected or refused to institute
any such action, suit or proceeding and no direction inconsistent with such
written request has been given such Trustee during such sixty-day period by
such Certificateholders; it being understood and intended, and being expressly
covenanted by each Certificateholder with every other Certificateholder 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 Trustee, 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 Trustee shall, within five Business
Days after the receipt of such application, afford such Applicants reasonable
access during the normal business hours of the Trustee to the most recent list
of Certificateholders held by the Trustee 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
Certificate Registrar and the Trustee that neither the Depositor, 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
Owner, if the Holder is a Clearing Agency, may be embodied in and evidenced by
one or more instruments of substantially similar tenor signed by such Holders
in person or by agent duly appointed in writing; and, except as herein
otherwise expressly provided, such action shall become effective when such
instrument or instruments are delivered to the Trustee. 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, if made in the manner
provided in this Section.
(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 neither the Trustee nor 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 in reliance thereon, whether or not notation of such action is
made upon such Certificate.
ARTICLE IX
ADMINISTRATION AND SERVICING OF MORTGAGE LOANS
Section 9.01. Trustee To Retain Possession of Certain Documents.
Until all amounts distributable in respect of the Certificates have been
distributed in full, the Trustee (or its custodian) shall retain possession
and custody of each Mortgage File in accordance with and subject to the terms
and conditions of this Agreement; provided, that documents relating to any
Additional Collateral may be held by Custodian on behalf of the Trustee.
Section 9.02. Preparation of Tax Returns and Other Reports. (a) The
Trustee shall prepare or cause to be prepared on behalf of the Trust Fund,
based upon the information furnished by the Servicer or calculated by the
Trustee in accordance with this Agreement pursuant to instructions given by
the Depositor, and shall file federal tax returns and appropriate state income
tax returns and such other returns as may be required by applicable law
relating to the Trust Fund and shall forward copies to the Depositor of all
such returns and Form 1099 information and such other information within the
control of the Trustee 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 Trustee as are required by the Code and
the REMIC Provisions to be furnished to them, and will prepare and disseminate
to Certificateholders Form 1099s (or otherwise furnish information within the
control of the Trustee) to the extent required by applicable law.
(b) The Trustee shall prepare and file with the Internal Revenue
Service ("IRS"), on behalf of the Trust Fund, an application on IRS Form SS-4.
(c) The Depositor will prepare or cause to be prepared the initial
current report on Form 8-K and thereafter the Trustee will prepare or cause to
be prepared Forms 10-K and 10-Q (if necessary), or monthly current reports on
Form 8-K, on behalf of the Trust Fund, as may be required by applicable law or
regulation, and will file such reports electronically with the Securities and
Exchange Commission (the "SEC"). The Trustee will sign each such report on
behalf of the Trust Fund, and will forward a copy of each such report to the
Depositor promptly after such report has been filed with the SEC. The
Depositor agrees to use its best efforts to seek to terminate such filing
obligation after the period during which such filings are required under the
Securities Exchange Act of 1934.
Section 9.03. Release of Mortgage Files. (a) Upon becoming aware of
the payment in full of any Mortgage Loan, or upon receipt by the Servicer of a
notification that payment in full has been escrowed in a manner customary for
payment to the Trustee on the next Remittance Date, the Servicer will
immediately notify the Trustee (or the Custodian) by a certification (which
certification shall include a statement to the effect that all amounts
received in connection with such payment that are required to be remitted to
the Trustee have been or will be so remitted) of a Servicing Officer and shall
request the Trustee (or the Custodian) to deliver to the Servicer the related
Mortgage File. Upon receipt of such certification and request, the Trustee (or
the Custodian) shall promptly release the related Mortgage File to the
Servicer and the Trustee shall have no further responsibility with regard to
such Mortgage File. Upon any such payment in full, the Trustee authorizes the
Servicer to give, as agent for the Trustee, as the mortgagee under the
Mortgage that secured the Mortgage Loan, an instrument of satisfaction (or
assignment of mortgage without recourse) regarding the Mortgaged Property
subject to the Mortgage, which instrument of satisfaction or assignment, as
the case may be, shall be delivered to the Person or Persons entitled thereto
against receipt therefor of such payment, it being understood and agreed that
no expenses incurred in connection with such instrument of satisfaction or
assignment, as the case may be, shall be chargeable to the Certificate
Account.
(b) From time to time and as appropriate for the servicing or
foreclosure of any Mortgage Loan and in accordance with Accepted Servicing
Practices, the Trustee (or the Custodian) shall execute such documents as
shall be prepared and furnished to the Trustee by the Servicer (in form
reasonably acceptable to the Trustee) and as are necessary to the prosecution
of any such proceedings. The Trustee (or the Custodian) shall, upon request of
the Servicer and delivery to the Trustee (or the Custodian) of a trust receipt
signed by a Servicing Officer substantially in the form of Exhibit C (or in
the form acceptable to FNMA or FHLMC), release the related Mortgage File held
in its possession or control to the Servicer. Such trust receipt shall
obligate the Servicer to return the Mortgage File to the Trustee (or the
Custodian) when the need therefor by the Servicer no longer exists unless the
Mortgage Loan shall be liquidated, in which case, upon receipt of a
certificate of a Servicing Officer similar to that specified above, the trust
receipt shall be released by the Trustee (or the Custodian) to the Servicer.
(c) The Trustee covenants and agrees that it will comply with all
relevant laws and regulations governing the custody, processing, release and
delivery of the Mortgage Loan documents within its possession or control.
ARTICLE X
REMIC ADMINISTRATION*
Section 10.01. REMIC Administration. As set forth in the Preliminary
Statement, the Trustee shall elect REMIC status in accordance with the REMIC
Provisions with respect to each of the Lower Tier REMIC and the Upper Tier
REMIC. The Trustee shall make such elections 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. For
purposes of such elections, the Class LT1 Interest and the Class LT2 Interest
are designated as regular interests in the Lower Tier REMIC. The Certificates,
other than the Class R Certificate, the Class AX Certificate, and the Class AP
Certificate, and each Component of the Class AX Certificate and the Class AP
Certificate, are designated as regular interests in the Upper Tier REMIC. The
Class LTR Interest and the Class R Certificate, are hereby designated as
representing ownership of the residual interest in each of the Lower Tier
REMIC and the Upper Tier REMIC.
(a) The Closing Date is hereby designated as the "Startup Day" of
each REMIC within the meaning of section 86OG(a)(9) of the Code.
(b) The Trustee 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 Trustee in fulfilling its
duties hereunder (including its duties as tax return preparer).
(c) The Trustee shall prepare, sign, and file all of each REMIC's
federal and state tax and information returns as such REMIC's direct
representative. The expenses of preparing and filing such returns shall be
borne by the Trustee.
(d) The Trustee or its designee shall perform on behalf of each REMIC
all reporting and other tax compliance duties that are the responsibility of
each REMIC under the Code, the REMIC Provisions, or other compliance guidance
issued by the Internal Revenue Service or any state or local taxing authority.
Among its other duties, if required by the Code, the REMIC Provisions, or
other such guidance, the Trustee shall provide (i) to the Treasury or other
governmental authority such information as is necessary for the application of
any tax relating to the transfer of a Residual Certificate to any disqualified
person or organization and (ii) to the Certificateholders such information or
reports as are required by the Code or REMIC Provisions.
----------------------------
* Subject to change after review by Xxxxx & Xxxx tax department.
(e) The Trustee and the Holders of Certificates shall take any action
or cause each REMIC to take any action necessary to create or maintain the
status of such REMIC as a REMIC under the REMIC Provisions and shall assist
each other as necessary to create or maintain such status. Neither the Trustee
nor the Holder of any Residual Certificate shall 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 (i) endanger the status of such REMIC as a REMIC or (ii) result
in the imposition of a tax upon such REMIC (including but not limited to the
tax on prohibited transactions as defined in Code Section 860F(a)(2) and the
tax on prohibited contributions set forth on Section 860G(d) of the Code)
(either such event, an "Adverse REMIC Event") unless the Trustee has 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 a REMIC or the assets therein, or causing such
REMIC to take any action, which is not expressly permitted under the terms of
this Agreement, any Holder of a Residual Certificate will consult with the
Trustee or its designee, in writing, with respect to whether such action could
cause an Adverse REMIC Event to occur with respect to such REMIC, and no such
Person shall take any such action or cause such REMIC to take any such action
as to which the Trustee has advised it in writing that an Adverse REMIC Event
could occur.
(f) 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 Trust taxes are not paid by a Residual
Certificateholder, the Trustee shall pay any remaining REMIC taxes out of
current or future amounts otherwise distributable to the Holder of the
Residual Certificate in such REMIC or, if no such amounts are available, out
of other amounts held in the Certificate Account, and shall reduce amounts
otherwise payable to holders of regular interests in such REMIC, as the case
may be.
(g) The Trustee 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 with respect to eligible
substitute mortgage loans if permitted by the Seller's Warranties and
Servicing Agreement.
(h) The Trustee shall not enter into any arrangement by which any
REMIC will receive a fee or other compensation for services.
Section 10.02. Prohibited Transactions and Activities. Neither the
Depositor 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 Certificate 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, or substitution) that such disposition, acquisition,
substitution, or acceptance will not (a) affect adversely the status of such
REMIC as a REMIC or of the Certificates other than the Residual Certificates
as the regular interests therein, (b) affect the distribution of interest or
principal on the Certificates, (c) result in the encumbrance of the assets
transferred or assigned to the Trust Fund (except pursuant to the provisions
of this Agreement) or (d) cause such REMIC to be subject to a tax on
prohibited transactions or prohibited contributions pursuant to the REMIC
Provisions.
The Trustee shall not consent to any modification of any material
term of any Mortgage Loan unless it has received an Opinion of Counsel (at the
expense of the party requesting such modification) to the effect that such
modification would not cause the Trust Fund to fail to qualify as a REMIC or
result in the imposition of any tax under Section 860(F)(a) or Section
860(G)(d) of the Code.
Section 10.03. Indemnification with Respect to Certain Taxes and Loss
of REMIC Status. In the event that any REMIC fails to qualify as a REMIC,
loses its status as a REMIC, or incurs federal, state or local taxes as a
result of a prohibited transaction or prohibited contribution under the REMIC
Provisions due to the negligent performance by the Trustee of its duties and
obligations set forth herein, the Trustee shall indemnify the Holder of the
related Residual Certificate against any and all losses, claims, damages,
liabilities or expenses ("Losses") resulting from such negligence; provided,
however, that the Trustee shall not be liable for any such Losses attributable
to the action or inaction of the Depositor, or the Holder of such Residual
Certificate, as applicable, nor for any such Losses resulting from
misinformation provided by the Holder of such Residual Certificate on which
the Trustee has relied. The foregoing shall not be deemed to limit or restrict
the rights and remedies of the Holder of such Residual Certificate now or
hereafter existing at law or in equity. Notwithstanding the foregoing,
however, in no event shall the Trustee have any liability (1) for any action
or omission that is taken in accordance with and in compliance with the
express terms of, or which is expressly permitted by the terms of, this
Agreement, (2) for any losses other than arising out of a negligent
performance by the Trustee of its duties and obligations set forth herein, and
(3) for any special or consequential damages to Certificateholders (in
addition to payment of principal and interest on the Certificates).
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 and the Trustee, without notice to or the
consent of any of the Holders, (i) to cure any ambiguity, (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, (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, adversely affect the
status of any REMIC created pursuant to this Agreement, nor shall such
amendment effected pursuant to clause (iii) of such sentence adversely affect
in any material respect the interests of any Holder without regard to the
Class 2-A3 Certificate Insurance Policy. Prior to entering into any amendment
without the consent of Holders pursuant to this paragraph, the Trustee may
require an Opinion of Counsel (at the expense of the party requesting such
amendment) to the effect that such amendment is permitted under this
paragraph. 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 (in
the case of the Class 2-A3 Certificates, determined without regard to the
Class 2-A3 Certificate Insurance Policy) to reduce the then current rating
assigned to the Certificates (and any Opinion of Counsel requested by the
Trustee in connection with any such amendment may rely expressly on such
confirmation as the basis therefor).
(b) This Agreement may also be amended from time to time by the
Depositor and the Trustee with the consent of the Holders of not less than
66-2/3% of the Class Certificate Principal Amount (or Aggregate Notional
Amount) 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 adversely affect the status of any REMIC
as a REMIC or cause a tax to be imposed on such REMIC; 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 Certificate
Principal Amount (or Aggregate Notional Amount) 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 Certificate Principal Amount (or
Aggregate Notional Amount) of each Class of Certificates affected thereby. For
purposes of this paragraph, references to "Holder" or "Holders" shall be
deemed to include, the case of any Class of Book-Entry Certificates, the
related Certificate Owners.
(c) Promptly after the execution of any such amendment, the Trustee
shall furnish written notification of the substance of such amendment to each
Holder, the Depositor and to 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 Principal Amount (or Notional Amount), Certificates owned by the
Depositor, the Trustee or the Servicer or Affiliates thereof are not to be
counted so long as such Certificates are owned by the Depositor, the Trustee
or the Servicer or Affiliates thereof.
Section 11.05. Provision of Information. (a) For so long as any of
the Certificates of any Series or Class are "restricted securities" within the
meaning of Rule 144(a)(3) under the Act, each of the Depositor and the Trustee
agree to cooperate with each other to provide to any Certificateholders and to
any prospective purchaser of Certificates designated by such
Certificateholder, upon the request of such Certificateholder 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
in providing such information shall be reimbursed by the Depositor.
(b) The Trustee will provide to any person to whom a Prospectus was
delivered, upon the request of such person specifying the document or
documents requested, (i) 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 9.02(c) and (ii) a copy of any document incorporated by reference in
the Prospectus. Any reasonable out-of-pocket expenses incurred by the Trustee
in providing copies of such documents shall be reimbursed by the Depositor.
(c) On each Distribution Date the Trustee shall deliver or cause to
be delivered by first class mail to the Depositor, Attention: Contract
Finance, a copy of the report delivered to Certificateholders pursuant to
Section 4.03.
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.
Section 11.07. Notices. All demands, notices 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, Structured Asset Securities
Corporation, 000 Xxxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Xxxx Xxxx, (b) in the case of the Trustee, U.S. Bank National
Association, 000 Xxxx Xxxxx Xxxxxx, Xx. Xxxx, Xxxxxxxxx 00000 Attention:
Structured Finance (First Nationwide Trust 1999-1/ SASCO 1999-1) and (c) in
the case of the Class 2-A3 Certificate Insurer, MBIA Insurance Corporation,
000 Xxxx Xxxxxx, Xxxxxx, Xxx Xxxx 00000, Attention: Insured Portfolio
Management - Structured Finance (IMP-SF), First Nationwide Trust
1999-1/Structured Asset Securities Corporation Mortgage Pass-Through
Certificates, Series 1999-1, Class 2-A3 Certificates, or as to each party such
other address as may hereafter be furnished by such Party to the other parties
in writing. Any notice required or permitted to be mailed to a Holder shall be
given by first class mail, postage prepaid, at the address of such Holder as
shown in the Certificate Register. Any notice so mailed within the time
prescribed in this Agreement shall be conclusively presumed to have been duly
given, whether or not the Holder receives such notice.
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. (a) Subject to Section 11.14,
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 paragraph (b) of this Section 11.11.
(b) Notwithstanding any provision herein to the contrary, the parties
to this Agreement agree that it is appropriate, in furtherance of the intent
of such parties as set forth herein, that the Servicer receive the benefit of
the provisions of Section 9.03 hereof and of this Section 11.11 as an intended
third party beneficiary of this Agreement to the extent of such provisions.
The Trustee shall have the same obligations to the Servicer under Section 9.03
hereof as if the Servicer were a party to this Agreement, and the Servicer
shall have the same rights and remedies to enforce the provisions of Section
9.03 hereof and this Section 11.11 as if the Servicer were a party to this
Agreement.
Section 11.12. Special Notices to the Rating Agencies. (a) The
Depositor shall give, prompt notice to the Rating Agencies and to the Class
2-A3 Certificate Insurer 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) the appointment of any successor to the Servicer
pursuant to Section 6.14;
(iii) the making of a final payment on the Group 2
Certificates pursuant to Section 7.02;
(iv) the occurrence of an Event of Default under the
Seller's Warranties and Servicing Agreement;
(v) the termination of the rights and obligations of the
Servicer pursuant to the Seller's Warranties and Servicing Agreement;
and
(vi) the appointment of any successor Servicer under the
Seller's Warranties and Servicing Agreement.
(b) All notices to the Rating Agencies provided for in this Section
shall be in writing and sent by first class mail, telecopy or overnight
courier, as follows:
If to Fitch to:
Xxx Xxxxx Xxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
If to S&P, to:
Standard & Poor's Ratings Services,
A division of The XxXxxx-Xxxx Companies, Inc.
00 Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Residential Mortgages
(c) The Trustee shall deliver to the Rating Agencies reports prepared
pursuant to Section 4.03.
Section 11.13. 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 11.14. Matters Relating to the Class 2-A3 Certificate
Insurance Policy. (a) All notices, statements, reports, certificates or
opinions required by this Agreement to be sent to any other party hereto or to
the Class 2-A3 Certificateholders shall also be sent, and any report or
statement sent by the Servicer to the Trustee in accordance with the Seller's
Warranties and Servicing Agreement shall be sent by the Trustee, to the Class
2-A3 Certificate Insurer at the following address:
MBIA Insurance Corporation
000 Xxxx Xxxxxx
Xxxxxx, Xxx Xxxx 00000
Attention: Insured Portfolio Management - Structured Finance
Re: First Nationwide Trust 1999-1/Structured Asset Securities
Corporation Mortgage Pass-Through Certificates, Series
1999-1, Class 2-A3 Certificates
or such other address as the Class 2-A3 Certificate Insurer may hereafter
furnish to the Depositor and the Trustee.
(b) Notwithstanding any provision to the contrary, the parties to
this Agreement agree that it is appropriate, in furtherance of the interest of
such parties as set forth herein, the Class 2-A3 Certificate Insurer receive
the benefit of Sections 4.03, 5.02, 5.06 and 11.14 as an intended third party
beneficiary of this Agreement to the extent of such provisions.
(c) No purchase of the property of the Trust Fund pursuant to Section
7.01(b) shall occur if such purchase would result in a draw on the Class 2-A3
Certificate Insurance Policy, unless the Class 2-A3 Certificate Insurer has
consented to such purchase.
(d) All references herein to the rating of the Certificates shall be
without regard to the Class 2-A3 Certificate Insurance Policy.
IN WITNESS WHEREOF, the Depositor and the Trustee have caused their
names to be signed hereto by their respective officers hereunto duly
authorized as of the day and year first above written.
STRUCTURED ASSET SECURITIES
CORPORATION, as Depositor
By:/s/ Xxxxxx X. Xxxxx
-------------------------
Name: Xxxxxx X. Xxxxx
Title: Vice President
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By:/s/ Xxx X. Xxxxxx
-------------------------
Name: Xxx X. Xxxxxx
Title: Vice President
For Purposes of Section 9.03 and 11.11,
accepted and agreed to by:
FIRST NATIONWIDE MORTGAGE CORPORATION
By:/s/ Xxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Executive Vice President
EXHIBIT A
---------
FORMS OF CERTIFICATES
Exhibit B-1
-----------
FORM OF FINAL CERTIFICATION
------------
[Date]
Structured Asset Securities Corporation
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Trust Agreement (the "Trust Agreement"), dated as of
February 1, 1999 between Structured Asset Securities Corporation,
as Depositor and U.S. Bank National Association, as Trustee,
with respect to First Nationwide Trust 1999-1/Structured Asset
Securities Corporation Mortgage Pass-Through Certificates, Series 1999-1
Ladies and Gentlemen:
In accordance with Section 2.02(b) of the Trust Agreement, the
undersigned hereby certifies that as to each Mortgage Loan listed in the
Mortgage Loan Schedule (other than any Mortgage Loan paid in full or listed on
the attachment hereto) it (or the Custodian) has received:
(i) the original Mortgage Note endorsed without recourse in proper
form to the order of the Trustee;
(ii) a duly executed Assignment of Mortgage or assignment of security
agreement;
(iii) with respect to any Mortgage Loan other than a Cooperative
Mortgage Loan, the original recorded Mortgage, and with respect to any
Cooperative Mortgage Loan, the original recorded pledge and security
agreement, with evidence of recording indicated thereon; or, if, in connection
with any Mortgage Loan, the Depositor (or the Servicer or any of its
correspondents, at the direction of the Seller and the Depositor) cannot
deliver the Mortgage or pledge and security agreement with evidence of
recording thereon because such document has been lost, the Depositor (or the
Servicer or its correspondents, at the direction of the Seller and Depositor)
shall deliver or cause to be delivered to the Trustee, a photocopy of such
document (certified by the Servicer or its correspondents to be a true and
correct copy) together with a written Opinion of Counsel acceptable to the
Trustee and the Depositor that an original recorded Mortgage or pledge and
security agreement is not required to enforce the Trustee's interest in the
Mortgage Loan;
(iv) if applicable, such original intervening assignments
("Intervening Assignments"), as may be necessary to show a complete chain of
title to the Mortgage from the originator to the Trustee at the direction of
the Seller and the Depositor; or, as to any such Intervening Assignment which
cannot be delivered because such Intervening Assignment has been lost, a
photocopy of such Intervening Assignment and a certificate of the Servicer as
specified in Exhibit C-1 of the Seller's Warranties and Servicing Agreement.
(v) with respect to any Mortgage Loan other than a Cooperative Loan,
the original lender's Title Insurance Policy or a written commitment to issue
such Title Insurance Policy or, in lieu thereof, a copy of such Title
Insurance Policy;
(vi) the original of each assumption, modification or substitution
agreement, if any, relating to the Mortgage Loans (as and to the extent of
those Mortgage Loans specifically identified by the Servicer to be subject to
any assumption, modification or substitution;
(vii) with respect to any Cooperative Mortgage Loan, the original
Cooperative Loan Documents; and
(viii) the original additional collateral pledge and security
agreement executed in connection with each pledge of Additional Collateral,
assigned to the Trustee.
The undersigned hereby certifies that as to each Mortgage Loan
identified on the Mortgage Loan Schedule, other than any Mortgage Loan listed
on the attachment hereto, it has reviewed the documents listed above and has
determined that each such document appears to be complete and, based on an
examination of such documents, the information set forth in the Mortgage Loan
Schedule is correct.
Capitalized words and phrases used herein shall have the respective
meanings assigned to them in the Trust Agreement. This Certificate is
qualified in all respects by the terms of said Trust Agreement.
[Custodian]
[[ ],
as Trustee]
By:________________________________
Name:
Title:
Exhibit B-2
-----------
FORM OF ENDORSEMENT
Pay to the order of U.S. Bank National Association, as trustee (the
"Trustee") under a Trust Agreement dated as of February 1, 1999, between
Structured Asset Securities Corporation, as Depositor, and the Trustee
relating to First Nationwide Trust 1999-1/Structured Asset Securities
Corporation Mortgage Pass-Through Certificates, Series 1999-1, without
recourse.
----------------------------------
[current signatory on note]
By:_______________________________
Name:
Title:
EXHIBIT C
---------
REQUEST FOR RELEASE OF DOCUMENTS AND RECEIPT
---------
[Date]
[Addressed to Trustee
or, if applicable, custodian]
In connection with the administration of the mortgages held by you as
Trustee under a certain Trust Agreement dated as of _________________ 1, 199
____ between Structured Asset Securities Corporation, as Depositor, and you,
as Trustee (the "Trust Agreement"), the undersigned Servicer hereby requests a
release of the Mortgage File held by you as Trustee with respect to the
following described Mortgage Loan for the reason indicated below.
Mortgagor's Name:
Address:
Loan No.:
Reason for requesting file:
1. Mortgage Loan paid in full. (The Servicer hereby certifies that
all amounts received in connection with the loan have been or will be credited
to the Collection Account or the Certificate Account (whichever is applicable)
pursuant to the Trust Agreement.)
2. Mortgage Loan repurchased. (The Servicer hereby certifies that the
Purchase Price has been credited to the Collection Account or the Certificate
Account (whichever is applicable) pursuant to the Trust Agreement.)
3. Mortgage Loan substituted. (The Servicer hereby certifies that a
Qualifying Substitute Mortgage Loan has been assigned and delivered to you
along with the related Mortgage File pursuant to the Trust Agreement.)
4. The Mortgage Loan is being foreclosed.
5. Other. (Describe)
The undersigned acknowledges that the above Mortgage File will be
held by the undersigned in accordance with the provisions of the Trust
Agreement and will be returned to you within ten (10) days of our receipt of
the Mortgage File, except if the Mortgage Loan has been paid in full, or
repurchased or substituted for a Qualifying Substitute Mortgage Loan (in which
case the Mortgage File will be retained by us permanently) and except if the
Mortgage Loan is being foreclosed (in which case the Mortgage File will be
returned when no longer required by us for such purpose).
Capitalized terms used herein shall have the meanings ascribed to
them in the Trust Agreement.
----------------------------------
[Name of Servicer]
By:_______________________________
Name:
Title: Servicing Officer
EXHIBIT D-1
------------
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), 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 is not, and on ___________________
[insert date of transfer of Residual Certificate to Purchaser] will not be,
and is not and on such date will not be investing the assets of, an employee
benefit plan subject to the Employee Retirement Income Security Act of 1974,
as amended ("ERISA"), or a plan subject to Code Section 4975 or a person or
entity that is using the assets of any employee benefit plan or other plan to
acquire a Residual Certificate.
5. That the Purchaser hereby acknowledges that under
the terms of the Trust Agreement (the "Agreement") between Structured Asset
Securities Corporation and U.S. Bank National Association, as Trustee, dated
as of February 1, 1999, no transfer of the Residual Certificates shall be
permitted to be made to any person unless the Trustee has received a
certificate from such transferee to the effect that such transferee is not an
employee benefit plan subject to ERISA or a plan subject to Section 4975 of
the Code and is not using the assets of any employee benefit plan or other
plan to acquire Residual Certificates.
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 Trustee a written statement
substantially in the form of Exhibit G 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 and the Trustee with an effective Internal Revenue
Service Form 4224 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 both the
transferor and the Trustee 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 a citizen or
resident of the United States, a corporation, partnership or other entity
created or organized in or under the laws of the United States or any
political subdivision thereof, or an estate that is subject to U.S. federal
income tax regardless of the source of its income, or 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.
11. That the Purchaser agrees to such amendments of
the Trust 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.
12. That the Purchaser consents to the designation of
the Trustee as its agent to act as "tax matters person" of the Trust Fund
pursuant to the Trust Agreement.
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 __________, 19__.
---------------------------------
[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 __________,
19__.
NOTARY PUBLIC
------------------------------
COUNTY OF_____________________
STATE OF______________________
My commission expires the _____ day of __________, 19__.
EXHIBIT D-2
-----------
RESIDUAL CERTIFICATE TRANSFER AFFIDAVIT (TRANSFEROR)
-------------------
Date
Re: Structured Asset Securities Corporation
Mortgage Pass-Through Certificates Series 1999-1
_______________________ (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:
EXHIBIT E
---------
SELLER'S WARRANTIES AND SERVICING AGREEMENT
EXHIBIT F
---------
FORM OF RULE 144A TRANSFER CERTIFICATE
Re: First Nationwide Trust 1999-1/Structured
Asset Securities Corporation
Mortgage Pass-Through Certificates
Series 1999-1
----------------------------------
Reference is hereby made to the Trust Agreement dated as of
___________ 1, 199 (the "Trust Agreement") between Structured Asset Securities
Corporation, as Depositor, and [ __________________________ ], as Trustee.
Capitalized terms used but not defined herein shall have the meanings given to
them in the Trust 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
Trust 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 Placement Agent and the
Depositor.
---------------------------------
[Name of Transferor]
By:______________________________
Name:
Title:
Dated: ___________, ____
EXHIBIT G
---------
FORM OF PURCHASER'S LETTER FOR
INSTITUTIONAL ACCREDITED INVESTOR
-----------
[Date]
Dear Sirs:
In connection with our proposed purchase of $______________ principal
amount of Mortgage Pass-Through Certificates, Series 1999-1 (the "Privately
Offered Certificates") of Structured Asset Securities Corporation (the
"Depositor"), we confirm that:
(1) We have received a copy of the Private Placement Memorandum dated
______________ , 199 relating to the Privately Offered Certificates
(the "Private Placement Memorandum"), and 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 three 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 (which includes the Placement Agent) 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 an
exemption from registration in accordance with Rule 904 of Regulation
S under the Securities Act, (D) pursuant to the exemption from
registration provided by Rule 144 under the Securities Act, or (E) 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 Trustee under the Trust
Agreement dated as of February 1, 1999 between the Depositor and U.S.
Bank National Association, as Trustee (the "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 Trustee and the
Depositor a certification from such transferee in the form hereof to
confirm that the proposed sale is being made pursuant to an exemption
from, or in a transaction not subject to, the registration
requirements of the Securities Act. We further understand that the
Privately Offered Certificates purchased by us will bear a legend to
the foregoing effect.
(3) We are acquiring the Privately Offered Certificates for investment
purposes and not with a view to, or for offer or sale in connection
with, any distribution in violation of the 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 as to
which the Purchaser, the Depositor, any Servicer or Master Servicer
or the Trustee is a party in interest or disqualified person, and no
person acting on behalf of such a Plan may acquire such Certificate
unless the acquisition would constitute an exempt transaction under a
statutory exemption or any of the administrative exemptions issued by
the U.S. Department of Labor.
Terms used in this letter which are not otherwise defined herein have
the respective meanings assigned thereto in the Trust Agreement.
You and the Depositor 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:
EXHIBIT H
---------
[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 an employee
benefit plan subject to Section 406 or Section 407 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"), the Trustee of any
such plan or a person acting on behalf of any such plan nor a person using the
assets of any such plan or (2) if the Investor is an insurance company, such
Investor is purchasing such Certificates with funds contained in an "Insurance
Company General Account" (as such term is defined in Section v(e) of the
Prohibited Transaction Class Exemption 95-60 ("PTCE 95-60")) and that the
purchase and holding of such Certificates are covered under PTCE 95-60; or (y)
shall deliver to the Trustee and the Depositor an opinion of counsel (a
"Benefit Plan Opinion") satisfactory to the Trustee and the Depositor, and
upon which the Trustee and the Depositor shall be entitled to rely, to the
effect that the purchase or holding of such Certificate by the Investor will
not result in the assets of the Trust Fund being deemed to be plan assets and
subject to the prohibited transaction provisions of ERISA or the Code and will
not subject the Trustee or the Depositor to any obligation in addition to
those undertaken by such entities in the Trust Agreement, which opinion of
counsel shall not be an expense of the Trustee or the Depositor.
3. The Investor hereby acknowledges that under the terms of
the Trust Agreement (the "Agreement") between Structured Asset Securities
Corporation, as Depositor, and U.S. Bank National Association, as Trustee,
dated February 1, 1999, no transfer of the ERISA-Restricted Certificates shall
be permitted to be made to any person unless the Depositor and Trustee have
received a certificate from such transferee in the form hereof.
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 _______________, 199 .
---------------------------------
[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 ___________
199__.
----------------------------------
NOTARY PUBLIC
My commission expires the
____ day of __________, 19__.
EXHIBIT K
---------
CUSTODIAL AGREEMENT
SCHEDULE A
----------
MORTGAGE LOAN SCHEDULE
SCHEDULE B
----------
PRINCIPAL AMOUNT SCHEDULE
